Author Archives: Tom Mullen

It’s not labor unions that destroy the economy; it’s the New Deal and its awful progeny

First_United_States_Labor_Day_Parade,_September_5,_1882_in_New_York_CityTwo small minorities on either end of the political spectrum have strong feelings about Labor Day. One side sees the holiday as a celebration of all the victories hard working folks have won in securing their rights against greedy capitalists who would otherwise have them working twenty-three hours a day in sweat shops. The other side sees it as overt Marxism, so dangerous to all that’s good and holy the holiday should be renamed.

The other 95% are just damned glad to have the day off.

That the right wingers are paranoid doesn’t mean no one is out to get them. There is a very real connection between the holiday, the unions that proposed it and Marxism. American Marxists are firm supporters of unions, as were Marx and Engels themselves.

Neither is there any denying the damage unions appear to have done. Wherever labor unions are firmly entrenched, economic hardship proliferates. Outside the politically correct zone, everyone knows unions destroyed Detroit. If you have any doubt, just look at General Motors’ 2006 balance sheet. Either capitalists mysteriously ceased being greedy for the preceding fifty years or something forced them to be overly generous with pay and benefits, resulting in the bizarre preponderance of legacy benefit costs reflected there.

This would seem to be something of a paradox. How can this free association, an expression of the free market itself, be so harmful to our economic well-being?

The answer is labor unions themselves are not the problem. It’s labor union legislation, starting with the infamous “Wagner Act” (National Labor Relations Act of 1935) and continuing with subsequent legislation in the decades thereafter. These laws transformed the employment contract from a voluntary buyer-seller agreement to an involuntary one for one side.

The Wagner Act didn’t protect the right of sellers (employees) to freely associate and agree upon a minimum level of pay and benefits they would accept. They already had that right. The Wagner Act legalized violation of the buyers’ (employers) right to refuse to purchase their services. Just as sellers have a right to make collective bargaining a condition of the sale, buyers have a right to make individual bargaining a condition of their purchase.

In a free market, exchanges are supposed to happen only when both sides voluntarily agree to the price and the terms. If they can’t agree, they just don’t do business together, with each party free to buy or sell the services in question from and to others, respectively.

The Wagner Act overrides this natural law. It says the sellers are free to bargain collectively, but the buyer is not free to refuse. It makes one side of the agreement involuntary. Apart from the moral repugnancy of the idea, it causes huge economic distortions.

For example, it completely reverses the incentives for the sellers. If the buyers were allowed to negotiate freely with union and non-union members, the union would have to find a way to makes its members more productive than non-union workers to justify the higher price they ask for the same services.

Instead, unions in the present scenario have an incentive to make its workers less productive. Since the employer can’t say no, the union benefits from less productivity per worker, which results in a need for more total workers paying union dues. Anyone who’s been a new employee in a union shop will attest to the pressure from other employees to slow down one’s work in order to strengthen the union’s position at the bargaining table.

The right of buyers to buy from someone else or not buy at all is the most fundamental discipline a free market imposes on sellers. It is the only reason sellers seek to improve the quality and lower the price of their products. When this discipline is removed, prices go up and quality goes down. It’s the same phenomenon playing out in health care.

Ultimately, one shouldn’t blame labor unions for the economic misery they seem to spread. They are merely responding to incentives, just as do crony capitalists who benefit from protectionism. Put the blame squarely where it belongs, on the source of most human misery in this advanced age: government.

Enjoy the Labor Day holiday. Cook some hot dogs, crack open some cold ones and thank the hard workers the holiday is meant to honor under its rightful name. And while you’re at it, burn FDR in effigy for screwing everything up.

 

Tom Mullen is the author of A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

Cop Killings Are Way Down During Obama Presidency

obamaMilwaukee County Sheriff David Clarke told Fox News yesterday, “President Obama has breathed life into this ugly movement,” meaning Black Lives Matter and the “war on cops” Clarke says the president is at least partly responsible for.

This is part of a larger narrative in right-wing media that cop killings are increasing due to Obama’s tacit support for anti-cop activist groups and failure to condemn those who attack or kill police officers.

There’s only one problem with the narrative: Cop killings are way down during Obama’s presidency and on pace this year for the lowest annual total this century.

Read the rest at The Huffington Post…

 

Tom Mullen is the author of A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

Trump’s Protectionist Fallacies Have Been Refuted By Free Market Economists for Hundreds of Years

n-ADAM-SMITH-largeIt’s easy to understand the visceral attraction to Donald Trump’s campaign. My own libertarian heart beats a little stiff when he waves the one finger salute at establishment institutions that crush our freedom, including the Republican Party leadership, the mainstream media and the useless D.C. politicians themselves.

It’s not what Donald Trump is against that bothers me. It’s what he’s for. So much attention has been paid to his immigration stance from a race perspective that no one seems to care how anti-free market his platform is. Trump is running on economic fallacies that have been consistently refuted by free market economists for hundreds of years.

When Adam Smith wrote Wealth of Nations, it wasn’t to refute the “godless socialists” 21st-century Republican voters believe are taking over the world. It was to refute the kinds of protectionist ideas championed by conservatives like Edmund Burke and Alexander Hamilton in Smith’s day, Abraham Lincoln eighty years later, and Trump today.

Read the rest at The Huffington Post…

 

Tom Mullen is the author of A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

 

Job growth in WNY has speed, but does it really have credibility?

Pair_of_2009_SolarCity_Dodge_SprintersA July 26 article in the Buffalo News rejoiced, “Job growth in WNY gains speed, credibility.” There is no doubt about the speed. The credibility may be another story.

Writer David Robinson gave due credit to “high-profile projects, from the Medical Campus to Solar City’s 1,500-employee solar panel factory, that are giving a jolt to the local job market, first because of all the construction associated with those projects, and eventually with the hiring that will take place as those businesses ramp up.”

What he didn’t mention was why those two sectors were enjoying such spectacular growth: tax breaks and other incentives provided by local, state and federal governments.

It has become fashionable to call tax breaks “subsidies,” based on the perverse idea the government not only has a legitimate claim to all wealth you’ve created in the past, but any you may create in the future. Tax breaks aren’t subsidies, but they are part of a larger economic system that has never worked.

Step One is to tax and regulate everyone into a state of complete economic paralysis. Buffalo’s local governments perfected that fifty years ago. They never got around to Step Two until now.

Step Two is to grant limited relief to those businesses who either represent something politicians like or who promise to deliver something politicians need. Solar City does both. They represent the green energy movement, the cause célèbre of politicians everywhere. They have also promised to create a significant number of jobs, which helps politicians get reelected.

This may seem like a win-win for everyone, until that buzzkill called “economic reality” turns on the lights and turns off the music. Growth created by government privilege almost always turns out to be temporary. Viable business plans don’t need government assistance to make a profit and create new jobs. They produce products customers are willing to pay for at a price that supports the company’s costs and profits.

Solar City may or may not have a viable business plan. We don’t know, because it is presently riding government “subsidies” in all its markets, not just in Buffalo. We do know its stock is down over 8% since it reported earnings in May. We’ll get another report later this week.

The risk is Solar City turns out to be another Chevy Volt, a product that never would have made it to market without similar assistance from the government. Despite that assistance, the product’s sales have consistently failed to materialize. The government continues to help keep the product alive, but if jobs were actually dependent upon producing it, they’d cease to exist. Chevy’s sales of viable products are what actually subsidize the Volt.

Not only does this form of central economic planning promote unviable business ventures over viable ones, it encourages businesses to do economically idiotic things, like hire more people than it needs. A June 11, 2015 article in the News lamented, “Billed by officials as creating 400 jobs, FedEx center in Hamburg will fall short of that tally.”

The article attempts to incite outrage that Fedex has reneged on its promise of 400 jobs in return for the tax incentives, although it acknowledges it may have been politicians who made that promise, not Fedex. Lost in all of this is the basic economic principle that a business venture is supposed to produce its product at the lowest cost possible. It’s economically harmful to everyone when it intentionally raises its costs for political reasons.

That the other significant contributor to WNY jobs is the medical sector is ominous for all the same reasons. Medical care was already the most subsidized economic sector in human history before Bush and Obama subsidized it even more. It receives real subsidies, meaning direct cash payments from the government that represent about half of all U.S. health care spending. What happens when those subsidies run out?

Central economic planning doesn’t work. They found that out the hard way in the Soviet Union and China, where tens of millions literally starved to death because of it. Central Economic Planning Lite as practiced in this country doesn’t work, either. If tax breaks stimulate growth, they should simply be granted to all businesses, no strings attached. Then, the market will allow viable businesses to create permanent jobs.

Buffalo should try this approach and lead the nation in demonstrating the power of the free market, instead of following Washington to another disaster.

Tom Mullen is the author of Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty and the Pursuit of Happiness? Part One and A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

A Practical Solution: Run Police Departments Like Fire Departments

n-COP-GUN-large570Do you lie awake at night in constant fear a fire will break out and nothing will be done to put it out?

For the 99% of the population not suffering from pyrophobia or a similar neurosis, the answer to that question is “no,” even though firefighters aren’t patrolling the streets in their big red trucks. They still manage to arrive at the scene of a fire within minutes of an emergency call.

Why can’t police departments be run the same way?

If they were, Walter Scott, Freddie Gray, and Sandra Bland would be alive today. All three encountered police doing what would be considered outlandish for any other institution charged with public safety: roaming the streets, looking for trouble.

No one had called 911 asking for protection from Scott, Gray or Bland. No judges had issued warrants for their arrests. All three were, at least at the time of their arrests, just walking or driving down the street, minding their own business. They were detained in what are generally considered “routine” but are in reality wholly unnecessary encounters with police.

There has been a lot of digital ink and warm air expended on whether these victims of tragedy were treated differently because of their race. There are compelling arguments on both sides of that question, but no practical solutions offered by anyone. At the end of these discussions there is invariably some vague reference to “more training” or bland platitudes. Everyone knows nothing will change.

I’m going to suggest a solution that will sound radical, even in a country that styles itself “the land of free.” Let’s get cops off the streets, unless responding to a 911 call or serving a warrant issued by a judge. Everyone would be freer and safer, including the police officers themselves.

Read the rest at The Huffington Post…

 

Tom Mullen is the author of Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty and the Pursuit of Happiness? Part One and A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

Sandra Bland’s Arrest Wasn’t Racism; It Was Something Even Worse

n-POLICE-CAR-large570It’s easy to assume racism when watching the video footage of Sandra Bland’s arrest. Admittedly, the first question that entered this writer’s mind when watching it was, “Would a white woman have been treated this way during a routine traffic stop?”

I believe the answer is “yes,” if the white woman committed the cardinal sin Sandra Bland committed. It wasn’t her being black that started the tragic chain of events. It was refusing to follow a police officer’s orders.

At some point between ratification of the Fourth Amendment and the death of Sandra Bland, the entire principle underpinning that constitutional protection has been lost. The Fourth Amendment assumes armed agents of the state can’t be trusted to issue their own orders. That’s why we have warrants in the first place. They are permitted only to enforce the orders of an impartial judge, who authorizes them to apprehend suspects upon the judge’s determination of probable cause.

That’s not to say many or most officers aren’t well-intentioned or trustworthy. But their job is to use force. That role must be separated from the issuance of orders.

Read the rest at the Huffington Post…

 

Tom Mullen is the author of A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

 

Trump’s popularity is democracy in action

trump paulIn the past two Republican primary elections, we had a candidate who consistently defied the Establishment by articulately and intelligently telling the truth, remaining firm in his principles even when it cost him politically, and had a well thought out plan to change the political course of this country. He struggled to get 2 million votes.

This year, we have a candidate who consistently defies the Establishment by just “making shit up,” contradicting well-documented positions he’d taken just a few years ago, and delivering his message with all the eloquence of a punchy boxer in his twilight years. He’s leading in the polls.

That’s democracy in action, something the Constitution was designed to protect us from. God help us all.

 

Tom Mullen is the author of A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

 

Greek “no” vote on austerity isn’t remotely heroic or “libertarian”

greece-referendum-_3365507bThe 21st century global banking system based on fiat currencies and redistribution of wealth through inflation is immoral and destructive. That doesn’t mean stiffing your creditors is at all justified, heroic or remotely “libertarian,” as many on my newsfeeds are suggesting.

The Greeks who decided to take two month vacations, vote themselves useless government jobs and then retire at 50, all on someone else’s dime, aren’t the victims today. They are as much the perpetrators as the so-called “banksters.”

Photo: Sakis Mitrolidis/AFP

The real victims are those hardworking Greeks who have hitherto paid for all of this and the honest creditors who lent them money, although the latter have some culpability for bad judgment.

The Greek “no” vote on accepting “austerity” measures in return for additional loans from the European Central Bank (ECB) was more like a childish tantrum than a blow for freedom.

Imagine if you couldn’t pay your rent and asked a friend for a loan. If she agreed, stipulating you must cut your ice cream consumption from $100 to $50 per month, you wouldn’t be considered heroic for defiantly refusing her terms and still not being able to pay your rent or repay the other friend you borrowed from last month.

The Greek vote had nothing to do with liberty, but it was certainly democracy in action. Over two hundred years ago, John Adams wrote,

“Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There never was a democracy yet that did not commit suicide.”

The Greek democracy has the revolver to its head. Time will tell if democracy or common sense will prevail.

 

Tom Mullen is the author of A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

 

Dear Queen Elizabeth: Can we come back?

Dear Queen ElizabethDear Queen Elizabeth,

It’s been 239 years and we’re finally ready to admit we made a mistake. Just as your predecessor warned us, taxes are much higher, the government more oppressive, and liberty more non-existent than they ever were under the British monarchy.

We’re willing to bury the hatchet and rejoin the British Empire with that sweet tax deal you had for us in 1775. Don’t worry about representation. We tried it. Taxes skyrocketed.

Everything else we complained about got worse, too. Representative government issues more general warrants than the king’s officers ever did. In most cases, it doesn’t even bother with warrants. It just vacuums up our electronic data and peruses it at its pleasure.

It calls controlling everything from the food we eat to the amount of water in our toilets “regulating trade,” when all King George meant by that was levying a few tariffs. Our Federal Register is over 80,000 pages long. It’s insane.

In short, we were wrong. Let’s just pretend the whole, silly misunderstanding didn’t happen. I know it’s asking a lot, but you seem even nicer than George III was.

We’re willing to pay next year’s taxes at 1775 rates in advance. What say you?

Sincerely,

Your Prodigal Colonists

Tom Mullen is the author of Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty and the Pursuit of Happiness? Part One and A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.