Category Archives: Economics

>Housing in the New America

>Lest it fade from memory amidst almost daily violations of our rights by the federal government, let us consider some possible implications of the housing bill passed almost one month ago. Since then, the shares of Fannie Mae and Freddie Mac have plummeted yet again, and at this point, the “bazooka” that Treasury Secretary Paulson said he would likely never have to use is certainly loaded and ready for firing. In case you have forgotten, the urgency behind passing the housing bill, and the stated reason for President Bush withdrawing his veto threat, was the need to keep the two Government Sponsored Entities (GSE’s) from imminent bankruptcy. Paulson said that he needed vast powers at his disposal (the bazooka), including the statutory authority for the federal government to buy shares in Fannie and Freddie. He said at that time that he didn’t anticipate ever having to use the bazooka, but needed to have it to “boost confidence.” He was either lying or a fool.

It is apparent by now that the bazooka is not going to inspire investors to buy back into Freddie and Fannie. Shares have been as low as $3 and $4, respectively, in the past week, down from highs of $69 and $68 over the past year. They literally have trillions of dollars worth of bad mortgages on their books and no way to cover their obligations. While there is some justifiable outrage over the use of public funds to backstop these firms (although not enough), it doesn’t seem that the great majority of people see where this scenario is likely headed.

The U.S. government is going to have to buy a substantial portion of Fannie and Freddie, because no one else will. Of course, that will push up the price of their shares artificially, as the market has decided (rightly) that these companies are worthless. It is not out of the question that the federal government will acquire a controlling interest or all of the shares of the two GSE’s, perhaps with the stated intention of selling them back into the public sector after they have stabilized under the federal government’s “astute management.”

What happens then? Well, the tsunami of mortgage defaults continues, and another 2 million people walk away from their homes. However, these homes are not now owned by private sector banks, who must sell them at pennies on the dollar, if necessary, to recoup as much of their losses as they can. No, these houses are now owned by the federal government, for whom market forces do not apply. Of course, the government would want to get what they could out of these assets, but they have another alternative that is not available to the mortgage lenders, who cannot lose money indefinitely (in theory).

Before considering the government’s “other option,” let us take a step back and consider the bigger picture for a moment. It is obvious that the bursting of the housing bubble is symptomatic of a much bigger, more systemic problem for the U.S. economy. After decades of consuming more than it produces, its productive structure decimated by an increasingly predatory and parasitic government, the U.S. consumer economy itself is poised to collapse. Already, retailers are going bankrupt at an alarming rate, and despite the stock markets’ refusal to face reality, the U.S. economy no longer has the productive means to mount a recovery. The Federal Reserve has done everything it can do other than inflate further, which is what it will do, further destroying the U.S. currency. By this time next year, Americans will be looking into the abyss of an unprecedented economic disaster. We have had double digit unemployment before – this time it could be worse.

Of course, if government has proven one thing, it is that they will never learn that intervention into the marketplace never helps. After some inspiring speeches, our new, first-term president will declare war on the problem. That’s when things may really get ugly.

Just what could the federal government do with 30 million unemployed people and 7 million empty homes? Enter the Public Housing Administration and Section 8. Of course, there will need to be a “catchy” new government name to spin the new program to not sound like welfare. Perhaps “America Lives Together,” or “Communities in Progress” or some such nonsense. What is important is that the federal government will REALLY be in the housing business now, and not just for those below the poverty line. Average Americans will now be living in government-owned homes and paying rent directly to the government. Eventually, the rent payments could be incorporated into their payroll withholdings. One thing is for sure, once a federal government program is started, there is one thing it always does and one thing it never does. What it never does is go away. What it always does is grow larger.

Of course, this is not meant as a prediction, but merely one possible scenario among many that could result from America’s economic day of reckoning. However, while 40 years ago average citizens living in government housing was confined to the dark visions of Orwell and Burgess, today the unthinkable shouldn’t surprise us when it comes to any aspect of our society. We are presently giving serious consideration –in “the land of the free” – to socializing medicine, nationalizing the oil industry, and ending the rights of inheritance forever. A nation of socialized housing would complete that picture very well. Perhaps that America is still a few years off. On the other hand, we have been promised “change” during this next presidential term by a candidate with the most socialist platform we’ve seen in decades. Let’s hope it doesn’t look like this.

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>False Prophets of Freedom

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>One might be tempted to celebrate the “growing” number of people here in America that associate themselves with the “freedom movement.” As encouraging as it may be to see a loss of confidence in the present “neo-con” ruling class, there is certainly no reason to think that what most people would replace them with would result in any more liberty. Sadly, as was the case in Germany in the early 1930’s, the opposition to the present tyranny simply thinks their form of tyranny is better. Using Bastiat’s terms, they don’t object to legal plunder, they just have a different idea of how to divide up the loot.

While professing to be staunchly against tyranny, it is apparent that most people don’t seem to understand what tyranny is, and most importantly don’t understand its motivation. Perhaps many do not WANT to understand, because their solution may not be substantively different. Let me clear the air in the hopes that the 800 pound gorilla hiding in the corner of this tea party we call the “freedom movement” can cease to be politely ignored. In all of human history, there has only been one motivation for tyranny: plunder.

No conqueror in history has gone to the expense and trouble of raising, training, and feeding an army, marching them across vast distances, and risked his own position and wealth for the purposes of suppressing free speech. Neither has he done so to suppress freedom of religion, the writ of habeas corpus, or the right of the people to freely assemble. While he may have attacked all of these rights, he did so only as a means to one end: plunder. Every tyrant that ever lived has violated the rights of his own people and of those he has conquered for no other reason than to gather wealth that he did not earn.

The reason that most people don’t understand tyranny or its sole motivation is that they don’t truly understand liberty, either. If your understanding of liberty ends at freedom of speech, freedom of religion, freedom of association, and the right to due process, then you are omitting the heart and soul of liberty – property rights. Without a right to keep the fruits of your labor, there can be no liberty, no matter how fiercely the other “civil liberties” are protected. The right to the fruits of your labor is the central right, the foundation of liberty. Without controlling the fruits of your labor, you have no control over your life. Whether you have nothing to eat, a little to eat, enough to eat, or enough to save for another day all depends upon your control over the product of your work. However, it is the violation of precisely THIS right that is the sole desire of the tyrant.

This is why Jefferson said that “’the guarantee to every one of a free exercise of his industry and the fruits acquired by it” is the “first rule of association.”[1] Samuel Adams called it “self-preservation, commonly called the first law of nature.”[2] It is the reason that John Locke devoted an entire chapter of his 2nd Treastise on Civil Government to property, and the reason he said that “The great and chief end, therefore, of men’s uniting into commonwealths, and putting themselves under government, is the preservation of their property.”[3]

Plunder is the violation of this central right. Plunder is the use of force to divest people of the fruits of their labor without their consent. When it is done by individuals or groups outside of the law, it is recognized as a crime. When it is done by government, it becomes what Bastiat called “legal plunder.” Legal plunder by government generally falls into two categories: welfare and warfare. While cosmetically different, these two practices are essentially one and the same. They represent the use of government force to plunder the property of the individual. One merely does so farther away than the other – a relatively minor difference.

Recognizing that the right to property is the most important civil liberty (without which there can be no liberty), and recognizing also that plunder is the only true threat to liberty, Bastiat devoted much of his brilliant essay “The Law” to the subject of legal plunder. Like Locke, our founding fathers, and all philosophers in the liberal tradition, he recognized that government in a free society has only one purpose, beyond which it may not be permitted to go. Its sole purpose is to protect life, liberty, and property. According to Bastiat, the minute that government goes beyond fulfilling this role, it must necessarily attack life, liberty, and property. This is the fundamental principle of government which must be understood before one can begin answering questions of liberty.

Bastiat correctly concluded that there are only three alternatives for a society in determining how to address the question of plunder. Only by choosing the last of these can a society be free. It is not surprising that our two political parties generally align themselves with one of the other two. I will take the “liberty” of inserting their names in parenthesis next to the alternative they advocate:

1. The few plunder the many. (Republicans)
2. Everybody plunders everybody (Democrats)
3. Nobody plunders anybody (Freedom – the position of neither party)[4]

Like the unfortunate child in the middle of a game of “pickle in the middle,” Americans have been running back and forth between the first two alternatives offered by their political parties for decades. It has never occurred to the great majority of people that NEITHER ONE can benefit them in the end. There are only two possible reasons for this. Either the great majority of people do not understand the true nature of liberty and tyranny – that they both revolve around property rights – or the great majority of people DO NOT WANT TO UNDERSTAND. This may be because they secretly do not want to let go of the possibility that THEY ALSO might benefit from legal plunder. This second possibility is even more pathetic than the first. Like the gamblers in Las Vegas, they should know by now that the House always wins.

Rather than objecting to legal plunder itself, false prophets of freedom frame the debate into organizing opposition to the present ruling class on the assumption that the loot should merely be divided up differently. At the moment, the Democrats position themselves as against the war in Iraq, not because it is wrong, but because the Republicans started it. Their position is no more the position of liberty than was the Republicans’ in objecting to President Clinton’s war in Kosovo, or their ludicrous impeachment of him over a sex scandal. They are merely looking to divide up the loot differently.

However, politicians will be politicians, and I am much more concerned about the average American than I am about them. In the end, politicians can be bought with votes. If the vast majority of voters demand liberty, liberty is what they will get. However, when the vast majority of voters are persuaded to demand legal plunder, then it becomes clear why Madison described democracy as “the most vile form of government.”[5]

For those interested in finding their way through this maze of false assumptions, I offer the following examples of common arguments made on current issues and their implications for true liberty.

If you are (rightly) against the war in Iraq, but go on to say that the money we are spending on that war should instead be spent on providing healthcare to uninsured Americans, you are not against legal plunder. You merely want to divide up the loot differently.

If you are opposed to the recent bailouts of the banks during the mortgage crisis, but like False Prophet of Freedom Lou Dobbs go on to say that the government should instead help average Americans that are in danger of losing their homes, you are not against legal plunder. You merely want to divide up the loot differently.

If you are against the fascist alliance being formed between large corporations and government, but suggest taxing the profits of corporations more heavily to fund some public redistribution of wealth, you are not against legal plunder. You merely want to divide up the loot differently.

If you are concerned that Social Security and Medicare are imminently insolvent, and go on to argue that they must be “reformed,” rather than abolished (or at least phased out), then you are not against legal plunder. You are merely concerned that you won’t get your share of the loot.

These are only a few examples of the lapses in reason so common even among those who claim to be part of the “freedom movement.” Presently, average Americans are running from the Republicans (the few plunder the many) to the Democrats (everybody plunders everybody) in their perennial game of pickle in the middle. They still haven’t noticed that no matter which side they’ve run to over the past century, they never actually get to catch the ball. However, the implications are more ominous than this.

After at least a century of practicing legal plunder in one form or another, the inevitable end to which such a society comes is now in sight. Having given up the central civil liberty – property rights – Americans now see that the government monster they have built is coming to gather up the rest of the rights that people have deluded themselves that they retain. It is vital to realize that the police state measures and the perpetual war that we now find ourselves confronted with are not an aberration of the Bush administration BUT THE LOGICAL END OF DECADES OF LEGAL PLUNDER. This was Hayek’s central point in his classic The Road to Serfdom – that Naziism was the natural result of socialism, and that England’s and America’s socialism of the 1940’s would eventually lead to the same results in decades to come as Germany’s socialism of the 1870’s had led to by 1933. He was not only correct in theory, but seems to have correctly predicted the duration.

In conclusion, there will be no “freedom movement” until Americans recognize and understand the nature of freedom and tyranny. Until Americans cease to marginalize or ignore property rights, and again recognize them as the MOST important rights, as our founding fathers did, we will not move one inch toward freedom. In fact, even if we were able to completely end warfare for several presidential administrations in a row, our practice of welfare would lead us right back to our present circumstances.

Do not look to your politicians to offer you Bastiat’s third alternative. They have seduced free people throughout history with the prospect of sharing in legal plunder, while keeping the majority of the loot for themselves. It is left up to every American to reject the notion of legal plunder on their own, to reject the false prophets of freedom, be they named McCain, Obama, Clinton, Dobbs, Paulson, Bernanke, or Roosevelt, and again take responsibility for their own self preservation, and thus regain the right to determine it themselves. This is the ONLY path to freedom.

Tom Mullen

[1] Jefferson, Thomas Note in Destutt de Tracy’s “A Treatise on Political Economy,” 1816. ME 14:466
[2] Samuel Adams The Rights of the Colonists (1772) The Report of the Committee of Correspondence to the Boston Town Meeting, Nov. 20, 1772 Old South Leaflets no. 173 (Boston: Directors of the Old South Work, 1906) 7: 417-428.
[3] Locke Second Treatise Ch. IX, Sec. 124
[4] Bastiat, Frederic The Law (1850) (words in parenthesis inserted by the author of this article)
[5] Madison, James Federalist #10

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>So Many Rights…

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>When looking for wisdom in the wilds of western New York, one might be surprised how often it can be found on the airwaves, listening to the legendary hockey announcer, Rick Jeanerette. Over the years, Buffalo Sabres fans have cheered while Jeanerette has boisterously called their teams triumphs with jingles like “Wowee Housley,” “This building is bedlam!” and the immortal “La-la-la-la Fontaine!” One night, after calling the action during a particularly one-sided fight, Jeanerette dryly remarked of the loser,

“He got hit with so many rights he was begging for a left.”

How prophetic.

After eight years of Republican rule (the barely noticeable change in power in Congress being largely irrelevant), most Americans have been reduced to the same circumstances. They may not love what the Democrats have to offer if they ever really take a moment to think about it, but as long as it’s not more of George Bush’s Republicans, they’ll take it. Like the hapless forward in that forgotten hockey brawl, they too have been hit with so many rights that they are begging for a left.

Left is just what they are going to get, and it’s going to hurt just as much – maybe more.
I don’t think that I’m alone in being astonished at how unabashedly socialist the rhetoric was during the Democratic presidential primary debates earlier this year. While Bill Clinton positioned himself as relatively centrist – sometimes almost Republican – while seeking to succeed what was perceived as relatively successful Republican administrations of the 1980’s and early 1990’s, the shift is quite startling now that today’s Democrats smell the blood of a Republican administration with approval ratings down around parking level 3. During the primary season, Democrats have suggested nationalizing the oil industry, nationalizing the healthcare system, and have even promised to “end poverty in one generation.”

Now that the primaries are over and Barack Obama has emerged as the party’s presidential candidate, one would expect that the rhetoric might ease a bit. Normally, candidates appeal more directly to the base during primary contests, but must play to independents and even voters of the opposing party when campaigning for the general election. In a way, Obama’s rhetoric is less inflammatory. However, having taken the time to sit down and listen to his speech in Berlin on July 24, I wasn’t, annoyed, disgusted, or outraged. I was terrified. I was terrified at the things that a man that is presently being cheered wildly by crowds of tens of thousands of Americans at a time was saying. Now, granted, he was speaking to the Germans, who practically invented socialism (no offense, monsieurs). However, the words he spoke were undoubtedly HIS words. Let’s take a close look at some of them.

““…that Europeans today are bearing new burdens and taking more responsibility in critical parts of the world, and that just as American bases built in the last century still help to defend the security of this continent, so does our country still sacrifice greatly for freedom around the globe.”

Well, there is a mouthful. It seems that Europeans now have responsibility for critical parts of the world, which I assume are outside of Europe. They are bearing burdens. Somehow, both of these things seem good to Mr. Obama. Of course, Americans are all too aware of the SACRIFICE they are making. Whether or not that sacrifice is really for “freedom” is very open to debate.

A few moments later, Mr. Obama tells the Germans that “the burdens of global citizenship continue to bind us together.” Not only that, but he warns that “A change of leadership in Washington will not lift this burden. In this new century, Americans and Europeans alike will be required to do more, not less.”

Would it be paranoid to suggest that someone wants us to get used to the idea of “burdens?” Of course, the word “sacrifice” has already appeared one time. It will not be the last.

““True partnership and true progress requires constant work and sustained sacrifice. They require sharing the burdens of development and diplomacy, of peace and progress, they require allies that will listen to each other, learn from each other, and most of all, trust each other.”

Now, someone will be bearing burdens AND sacrificing. Mr. Obama goes on to say, ““Now is the time to join together, through constant cooperation and strong institutions and shared sacrifice, and a global commitment to progress to meet the challenges of the 21st century.

Ok, Ok, I get it. Burden and sacrifice. Mr. Obama obviously wants us to get used to the idea. Of course, the best way to do that is to say the words over and over again. Once people are used to hearing the words, the ideas behind them are soon to follow. Mr. Obama’s intentions seem quite clear. In HIS 21st century, there are burdens to bear and sacrifices to be made.

Merriam-Webster’s dictionary defines sacrifice as “destruction or surrender of something for the sake of something else.” I think that it is safe to say that Mr. Obama is not talking here about destroying anything (although that is also part of his 21st century). No, the “sacrifice” that Mr. Obama refers to is definitely more in the “surrender” category, namely more of the fruits of your labor. However, the definition of sacrifice says that the surrender is made “for the sake of something else.” What does Mr. Obama have in mind?

Near the end of the speech, Mr. Obama tells us.

“This is our moment, this is our time. I know my country has not been perfect itself. At times, we struggled to keep the promise of liberty and equality of all people.”

Here we finally have it, the age old socialist oxymoron, liberty and equality. Certainly, those producing more than they consume will have to sacrifice quite a bit if equality is to be achieved with all of those consuming more than they produce, not to mention those producing nothing at all (including Mr. Obama – although I suspect he will end up in the “more equal than others” category). However, it need not be pointed out that government cannot try to achieve equality and protect liberty at the same time. Liberty recognizes equal rights, but it NEVER results in equality. That’s one of the great things about liberty.

As the Democrats often claim to be “the party of Jefferson,” I will remind Mr. Obama of the words of his party’s patron,

“…that our wish, as well as theirs, is, that the public efforts may be directed honestly to the public good, that peace be cultivated, civil and religious liberty unassailed, law and order preserved; equality of rights maintained, and that state of property, equal or unequal, which results to every man from his own industry, or that of his fathers.”[1]

For those who might not be getting the point, or think that it will be somehow noble or civic-minded to “bear the burdens” of Mr. Obama’s quest for equality, allow me to point out Merriam-Webster’s definition of “burden.”

“the bearing of a load —usually used in the phrase beast of burden.”

How does it sound now?

I do have a question for Barack Obama. It is this: What sacrifices will you make for liberty and equality in the 21st century, Mr. Obama? What burdens will YOU and YOUR family bear?
That’s what I thought.

I know those rights have hurt over the last eight years, Mr. and Mrs. American, but watch out for that left. It may be the knockout blow.

Tom Mullen

[1] Jefferson, Thomas 2nd Inaugural Address (1805)

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The Future of a Destructive Species

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Nature is often characterized as a delicate balance of plant and animal, predator and prey, land and waterway, forest and plain. While our world is probably more accurately viewed as an evolving environment, marked by constant change rather than balance, and certainly has periods of violent disruption (ice ages, etc.), for the most part, there are many long millennia between these disruptions during which Nature provides an environment of plenty for her creatures. The lion hunts the antelope, catching the slowest and weakest, and therefore culling the herd to make it stronger. The deer take what they need from the forest, leaving the forest intact to house the millions of other species which depend on its shelter. Even the lowly worm plays a part, consuming the very earth itself, and leaving behind nutrients that replenish the soil and make possible new life.

Of all of the species that have evolved on this planet, the mammals are among the most intelligent and most resourceful. While they enjoy many advantages over other species, they also have found their place in the great scheme of things, neither multiplying beyond the number their environment can support nor harming that environment in living out their lives and raising their families.

However, there is one mammal for whom this is not true. This species has developed an industriousness far beyond that of the others. Since its earliest history, this species of mammal has disrupted its environment and displaced other species, often wiping them out completely wherever it has made its home. It has destroyed forests both for the timber to build its homes and as collateral damage resulting from the expanse of its communities. It has destroyed the nesting habitats of countless endangered species of birds, interrupted the course of deer runs vital to the health of the herd, displaced fox, wolf, and squirrel, and destroyed countless ecosystems without hesitation, merely to expand its never-ending quest to subdue Nature herself in its own selfish interests.

It is long past the time to try to bring this species under some control before it succeeds in disrupting the environment any further. Its relentless need to widen its own habitat at the expense of every other species it shares a given locale with must be curbed before the earth as we know it becomes barren forever.

While some would argue that education or behavior modification could be successful in changing the habits of this ambitious species, the problem is now too urgent to wait several decades for such remedies to have an effect. A direct intervention is needed to prevent catastrophic consequences to the environment, including further deforestation, pollution of the water, and destruction of countless more ecosystems. Only the force of law can justly protect what we have left of the world we were born into.

Despite the urgent need of legislation and the immediate need to change the behavior of this species, it should be remembered that this species also has a right to exist, as long as it does not have any effect on its environment. Therefore, this new legislation must consist of just laws that will promote both the long-term sustainability of the environment and the long-term health of this species within it. Unlike so many failed efforts in the past, these laws should not amount to volumes of minute regulations that are difficult to enforce and impossible to fully understand. These new laws must represent a new way for this species to think about itself and its part in the world, and must be written so that obeying them is the only logical conclusion that a species not bent on suicide can come to. We must finally have laws written in words that this species can understand and accept.

We will need someone who can translate English into beaver.

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.

Exxon Mobil Profits Continue to Sag

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The recession the federal government is just admitting we are in is obviously taking its toll on Exxon Mobil, whose profits sagged in the 2nd quarter of 2008. What? Didn’t Exxon post record profits of $11.7 billion, kicking us all when we’re down fighting high gas and food prices? That was certainly the headline today in most newspapers and periodicals (https://biz.yahoo.com/ap/080731/earns_oil.html).

As usual, however, the “record profits” are measured nominally in U.S. dollars, which are literally losing value before the ink is dry on these financial articles. A careful read of the article reveals that Exxon made these record profits on about $138 billion in revenue, giving them a profit margin of 8.48% That’s down from the 1st quarter of 2008 when profits were 9.32%, which was also significantly lower than their 3 year average of 10.08% from 2005-2007.

Considering that the Federal Reserve has embarked on the most inflationary binge in its 95-year history, it is a little disingenuous to characterize a company as making “record profits” by measuring those profits nominally, instead of as a percentage of revenue. While the media is almost as anxious as the government to label “Big Oil” as the villain that is profiting on the hardship of the average American, those Americans would be best served to look in the opposite direction when the media points its finger – especially when it is pointing in the same direction as our federal government.

Just to put things in perspective, Campbell Soup Company had a similar profit margin over the same three-year period, 2005-2007. During that time, Campbell averaged a 10.22% profit margin on about $22.7 billion in revenue. However, unlike Exxon Mobile, whose profits have sagged during the past two quarters, Campbell Soup’s profits exploded – more than doubling – in its last reported quarter. After rising to 13% on $2.1 billion during the quarter ending January 27, 2008, Campbell posted a 28% profit on lower revenues of $1.8 billion during the quarter ending April 27, 2008.

28% profits while food prices are skyrocketing? Outrageous! Children are going without while Campbell’s executives laugh and say “mm-mm good!” Congressional hearings are in order. Perhaps we should seriously consider nationalizing the soup industry. I know Maxine Waters has kindly offered to take over Big Oil for us, which would undoubtedly result in lower gas prices, improving emissions results, and a white Christmas in South Beach. However, before we worry about filling up our gas-guzzling SUV’s, we need to do something about Big Soup.

>Letter to President Bush Regarding the Housing Bill

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>Mr. President,

I am writing to express my wishes in the strongest terms that you veto the housing bill that is likely to pass in the U.S. Senate tomorrow (Saturday July 26, 2008). This bill is an outright violation of the most basic property rights that our society is founded upon, redistributing tax monies paid by me and other citizens (who have no choice but to pay them) to those who either borrowed or lent in poor judgment. I am a homeowner that most likely paid too much for my own home, but would not consider using the force of government to extort “relief” from my fellow citizens. I deny their right to do likewise to me.

I have received a letter from U.S. Senator Mel Martinez stating that “we must use the resources of the federal government in a reasonable and responsible manner in order to mitigate future losses and put our housing market on the pathway to recovery.” I remind you, Mr. President, that those “federal funds” are nothing more than my property, paid in taxes for no other purpose than the protection of the rest of my property. My government, even by majority vote, does not have the right to dispose of my property to fund “grants for communities to purchase and renovate abandoned properties,” nor to “assist families facing foreclosure,” nor to prevent the bankruptcy of Fannie Mae or Freddie Mac, lending institutions that should never have been sponsored by government in the first place.

We were once a country where each individual was guaranteed unalienable rights. Now, it seems that our rights can be voted away whenever the legislature believes it will win favor with an uninformed electorate. I remind you of your oath to the Constitution, Mr. President, and beseech you, as the last line of defense of my rights, to veto this bill. Thank you for your time and kind consideration.

Regards,

A Farmer

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>A Crossroads

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“Among the natural rights of the Colonists are these: First, a right to life; Secondly, to liberty; Thirdly, to property; together with the right to support and defend them in the best manner they can. These are evident branches of, rather than deductions from, the duty of self-preservation, commonly called the first law of nature.”

– Samuel Adams The Rights of The Colonists (1772)[1]

Although the United States has the reputation as the most capitalist nation on earth, she is fast moving away from the principles of laissez faire capitalism, while formerly communist countries like China and Russia are moving closer to those principles. This is not surprising, given the 20th century history of China and Russia. Each rejected capitalism for communism, and each have already seen where the end of that road leads: poverty, starvation, mass murder, and totalitarianism. Russia and China have already had to face the fact that communism doesn’t work and reject it for a more free market economy, or face collapse and annihilation. To the extent that they have become freer, they have become more prosperous. To the extent that they still cling to the old ideals of communism or socialism, their progress is retarded.

The United States has not yet faced economic calamity on the scale of that faced by Russia or China, and that is due to the far lesser degree to which the United States has embraced socialism. Along with the western European countries that stood against communism throughout most of the last century, the United States has chosen the path of the “mixed economy,” attempting to mix elements of free market capitalism and socialism in an effort to more “equally” distribute the fruits of production, and to build a “social safety net” for those who at some point in their lives are unable to produce enough to meet their own needs.

However, if there is one common characteristic to the mixed economies of the west during the past century, it is economic decline. Certainly, there are temporary recoveries here and there by one country in relation to the others, but the overall quality of life for people in the mixed economies has been diminishing almost from the moment that they have decided to try to mix socialism with capitalism. Most people do not see the European Union for what it is: a temporary solution for a group of countries that became unable to sustain themselves economically on their own. This was not a result of new competition from emerging nations as much as the natural result of plundering the more productive members of society to support the less productive. Combining their economies under one currency and centrally planned economy merely allows the European Union to pool the productive capabilities of all of their societies, in order to create a larger surplus to plunder. However, the same forces that caused those nations to fail economically on their own will eventually overcome the group of nations together, as will be the result for the United States.

The United States has been able to avoid the economic collapses of the European economies largely due to the fact that it has “mixed” its economy with less outright socialism, at least in decades past. However, the compromises it did make with socialism were the cracks in America’s economic foundation, and as it has moved farther and farther toward socialism in recent decades, those cracks have begun to widen. Now America sits on the edge of the same economic precipice that overcame the economies of Europe. Those realities will become apparent within the next presidential term, possibly under dire circumstances.

Why doesn’t a mixed economy work? The answer is that even a mixed economy violates a fundamental moral and economic principle: property rights. While some might argue that a mixed economy attempts to combine a moral solution (economic equality) with a pragmatic one (productivity), a clear understanding of property rights shatters this fallacy. Violating property rights even for the purposes of achieving what some might regard as more “just” distribution of wealth is both ineffective AND immoral. If there is some transcendent justice in the world, it is that the practice of violating property rights is never successful in creating a sustainable economy.

It takes no monumental exercise of reasoning to see why capitalism has produced such enormous wealth so quickly wherever it has been practiced. In a complex society of millions of people, with each person making the most advantageous exchanges of property that they can, and with an incentive to consume less than they produce in order to realize savings for either capital or future retirement, productivity soars. Productivity in excess of what is consumed produces savings, or capital, which increases the means of production and results in even greater productivity. This was the system that made the United States the wealthiest nation on earth in one short century.

Thus, in economic terms, we have two identifiable extremes. Freedom is defined by the universal recognition of an unalienable right to the fruits of your labor. In contrast, slavery is the complete absence of ownership of the fruits of your labor. More than anything else, it is where a society falls between these two extremes that determines whether or not a society is free. The United States was once as close to the freedom extreme as may be possible for a society of flawed human beings.

Socialism does not recognize a person’s ownership over the fruits of his labor, nor his right to freely exchange those fruits with others. In a socialist system, the fruits of labor are distributed by the state as the state deems fit, not by the free exchanges between their citizens. Thus, their citizens do not enjoy the most basic right that makes them free, nor does the economy benefit from the fundamental building block of productivity.

Even in a mixed economy, where citizens retain some property rights, some of the fruits of their labor are still taken by government and redistributed without their consent. In the United States, this occurs through massive social programs like Medicare, Medicaid, Social Security, and Public Welfare. While Social Security and Medicare are funded partially by the contributions of the beneficiaries, there is no effective controlling mechanism to distribute benefits proportionately according to contribution, although Social Security has a crude methodology attempting to do so. More importantly, these programs violate the vital principle of consent. The participants in the programs do not participate voluntarily, but under the coercive power of government. Thus, ownership of the fruits of their labor is not respected in terms of the monies taken from them to fund the programs.

The violation of property rights does not stop with providing for the poor or elderly, but for corporate welfare as well. In an attempt to “manage the economy,” public funds are also used by the government to bail out failed corporations that are deemed “too big” or “too important” to be allowed to go bankrupt. This not only violates the rights of the people whose property is confiscated in order to underwrite these bailouts, but also causes distortions in the economy.
Rather than some type of compromise between freedom and slavery, which sounds bad enough, the mixed economy makes a more fundamental break with the principles of liberty. In a mixed economy, the citizens no longer have an unalienable right to the fruits of their labor, or property rights, but rather have the privilege of keeping that property that the government does not choose to take. Changing property from a right to a privilege is a monumental change in the principles that a society is founded upon. It crosses the majority of the divide between freedom and slavery. The moral argument against socialism or even a mixed economy is that they both violate property rights: the most important, most basic right that people have.

It is also easy to see why even a mixed economy is not sustainable economically. As it violates those property rights on a regular basis, it is siphoning off the surplus productivity from those producing more than they consume and distributing those savings to those consuming more than they produce. Thus, savings and capital are diminished at first, and eventually destroyed when the incentive to save is eroded. In practical terms, the laborer of today no longer saves for his retirement, partly because he is unable to due to the sizeable portion of his property that is seized to pay the benefits of present beneficiaries, and partly because he knows (or at least believes) that future generations will pay those benefits for him.

One need look no further than the present state of the American economy to see this argument proven out. After decades of growth of socialist programs like Social Security and Medicare, the United States has gone from being the world’s largest creditor to the world’s largest debtor. Its people and its government are mired in debt, and its economy has a negative savings rate. No longer is the American worker the highest paid or most productive in the world. One by one, the United States has lost its dominance in almost every economic sector, no longer producing the majority of goods and services it consumes. While our politicians may try to lead us to believe that economic cycles “just happen,” a sober look at the departure we’ve made away from our founding principles reveal the true reason for our economic decline. The foundation of this departure has been our violation of property rights.

We are now at a crossroads. Socialism, even “diluted” in our mixed economy, has lead us to where it always leads: to the verge of economic collapse. During the next presidential term, the United States is going to face an economic crisis that will startle even the most disinterested and apathetic of its citizens. The question is not so much “what is to be done?” as it is “who will you believe?” Already, politicians and the media are framing the debate on the assumption that it was capitalism and too little regulation over “greedy speculators” that caused our problems. False prophets of freedom, like Lou Dobbs, are masquerading as champions of the people while emphatically calling for more government regulation, and not denouncing wealth redistribution, but merely criticizing the way the loot is split. A new edifice is being built in the capital of the empire of lies.

No matter who gets elected, no matter what policies are made, an economic crisis is coming, and it will be painful. The only way for America to recover from it will be to rebuild its awesome productive capacity that once made it the greatest, wealthiest nation on earth. That cannot be done without rejecting the socialism – even the mixed economy variety – that has ruined her. She must again be an example to the world that liberty and individual rights are the only sustainable economic and political system. It will not be easy for America to choose this path. The voices of liberty have grown few and those advocating socialism have the media, the politicians, and the guns. However, as difficult as it may now seem, we must convince the American people that this calamity was not a failure of capitalism, regardless of what they are told. Economic upheavals spawn revolutions. In Russia and Germany during the early 20th century, those revolutions ended badly. We must educate our neighbors so that we choose a wiser path. Make no mistake; the danger is real. Lies and ignorance in the midst of this crisis can enslave us for generations, but the truth can surely set us free.

Tom Mullen

[1] Samuel Adams The Rights of the Colonists (1772) The Report of the Committee of Correspondence to the Boston Town Meeting, Nov. 20, 1772 Old South Leaflets no. 173 (Boston: Directors of the Old South Work, 1906) 7: 417-428.

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Can Individual Liberty Be Cool?

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While the big decisions about government and how our money is spent are made by the “over thirty crowd,” what is and is not cool belongs to the young. They are the ones that decide what clothes are cool, what music is cool, what movies are cool, and even what ideas are cool. Then they become adults, and before they know it, they have imperceptibly become uncool. Tragically, those who were coolest when they were young are the last to realize this when they are older.

What is cool is always what is new. Rock and roll was cool in the 1950’s, rock in the 1960’s, Disco in the 1970’s, new wave in the 1980’s, and grunge and rap in the 1990’s. What is old is never cool until it is so old that it has been forgotten. Then, it can become new all over again and have a new chance to be cool. Such is the fate of music, clothing, hairstyles, and ideas.

At no time in the past four decades has individual liberty been cool. During the 1960’s, the counterculture started a social revolution that still dominates American society. Some of it was good. The civil rights movement finally won equal rights for blacks and other minorities. Half the nation protested an immoral and terribly destructive war. Both of these movements had overwhelming support from the cool people – the young. The artist class of the time – the rock musicians and movie stars – united in support of these causes. College campuses protested. Anyone not for these programs was “not with it,” or what we would today call totally uncool.
However, the other far-reaching aspect of this revolution was its socialism. Certainly, socialism had been making inroads into American society since Woodrow Wilson, and had taken great strides under FDR. However, at the beginning of the 1960’s, America still held on to many of its values of individual liberty, free markets, self reliance, and property rights. That changed drastically with the advent of the Great Society, bringing in huge federal government spending programs like Medicare, Medicaid, the Department of Education, and various programs under “The War on Poverty.”

With the institution of these new social programs, which today combine with the New Deal programs to account for over half of all federal spending, the United States effectively shifted from a constitutional republic based upon individual liberty to a social democracy, devoted to economic equality. This shift was helped immensely by the fact that anyone who was remotely cool was behind it. Those same musicians and celebrities that correctly recognized the gross injustice of violating the civil liberties of blacks and other minorities somehow reconciled themselves with violating the most important civil rights of all – property rights. The same people that condemned the unjustified use of force against the Vietnamese had no problem initiating force against their fellow citizens to pay for the social programs. At least in popular culture, you had to be schizophrenic to be cool.

When I was a teenager in the early 1980’s, there was both a renewed interest in 60’s music and a new style of rock, called New Wave. Like any other teenager, my favorite bands were my heroes, and certainly the coolest people I knew about. While I rediscovered the Beatles, idolized John Lennon, and struggled to learn the guitar riff in “Shakin’ All Over,” I was electrified by the new sounds of R.E.M., U2, the Alarm, and The Housemartins. To the young and naïve, the haughty arrogance with which they contemptuously rebuffed the establishment and rebelled against authority was enough to create the illusion of intellectual superiority. Once someone is cool, you automatically think that they “get it.” Anyone that disagrees with them “doesn’t get it.” This is the message we get from our idols, and it is hard-coded into us by the time we’re old enough to drive. Such has been what is cool for several generations.

I consider myself lucky to have attended Canisius College in Buffalo, NY and had the professors I had in both economics and philosophy. Whatever the rest of the world was being taught then or is being taught today, my economics professors in 1984 were teaching me that Keynsian economics were on the way out, and that, among other things, monetary policy was an idea whose time had passed. At the same time, a philosophy teacher introduced me to John Locke’s Treatises on Civil Government. We spent weeks discussing those essays, dissecting them and discussing their importance to everything that our country was founded upon. I remember being completely enthralled with Locke, his ideas truly “making my heart beat faster.” I’m not sure if it was possible in 1690, but if it was, Locke was way cool.

It certainly didn’t sink in right away, but as I got out into the real world and got a little experience, I began to realize that there were some major problems with the philosophy that the cool people were promoting. Cool or not, their message seemed incompatible with the philosophy of liberty that I had come to believe in so deeply. It certainly came as quite a shock to me, when I finally LISTENED to the lyrics of John Lennon’s “Imagine,” that the song was actually a call for world communism. Although Michael Stipe has admitted that even HE didn’t know what he was saying on those early R.E.M. records, he is clear enough in his interviews about where he stands on politics. Similarly, “The World’s on Fire” is still one of my all-time favorite songs, but when I became aware of the Housemartins’ political beliefs, I realized that here again was the same socialist message.

Until Ron Paul’s presidential campaign, I had given up on individual liberty. Neither political party was championing it anymore – the Republicans said some nice things in 2000 and then increased entitlement spending more than any administration and Congress in 40 years. In addition, the Republicans had gradually become the pro-war party, contrary to their non-interventionalist stance throughout most of the 20th century. However, the lack of a choice in politics was not what made me abandon hope. It was the fact that for as long as I could remember, anyone that young people considered remotely cool were, for all practical purposes, socialists. With no political party taking a strong stance on individual liberty and the school system deteriorating so that no one seemed to be learning these principles, I had resigned myself that the individual liberty of Locke, the unalienable rights of Jefferson, and the self reliance of Emerson were now relegated to a dusty spot on my bookshelf. Freedom had been forgotten.

However, what was forgotten has become new again. I was quite surprised by the fact that so many college students were electrified by Ron Paul’s message. On no college campus that I can remember has the “cool crowd” ever rallied for individual liberty. Friends told me that Ron Paul’s anti-war message was what attracted young people, but that when they found out that his government was going to stop “giving them things,” that they would turn their backs in a second. I’m not so sure. Dr. Paul has said himself that he was surprised at how many young people focused upon his message about eliminating the Federal Reserve and the income tax, two of the “Ten Planks of the Communist Manifesto.”

As encouraging as that might be, individual liberty is never really going to catch on again until it finds a way to be cool – and let’s face it, all of the cool people are liberals. However, there is now a coalition forming between supporters of Ron Paul and disenfranchised Democrats to oppose civil liberties violations and wars of aggression. If together we can overcome these huge threats to our freedom, that alone will be a great victory. However, I wonder if we can agree that the social programs must go as well? While the wars are immoral and the police state is terrifying, it is the social programs that have destroyed the fabric of our productive society and eaten up all of our wealth. Will the same schizophrenia persist? Will we fight side by side to oppose the initiation of force abroad, but clash over ending it against our own citizens? Will we be united against violations of our rights by law enforcement, but divided when it comes to the most important right of all, the right to the fruits of our labor?

I have hope. Against a common enemy, former rivals often discover that the gulf between them is not that wide. Sometimes, they even find that they like each other. Libertarians agree with liberals on so many issues – war, tolerance, civil rights, free speech, freedom of the press. It is only property rights on which we differ. I humbly make one request of my new allies: consider the idea that voluntary exchange is a better way for us to deal with one another than coercion. I respect your passion to help those in need, but we cannot fund those efforts by force. If we can bridge this one gap, I believe we can form a coalition that will be unstoppable in restoring our republic to peace and freedom. By eliminating legal plunder, we can realize the dream of eliminating poverty and ignorance that seemed within reach a century ago. With the fruits of our labor restored to us, we can revive the private charities that once astonished de Tocqueville and inspired the world. Our nation can again be an engine of prosperity, not for the rich, but for all Americans, rich, poor, and middle class. If we can take this one leap of faith together and believe in freedom once again, there are no bounds to the heights we can reach.

Is that cool?

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The Nazis: Right Wing Extremists or National Socialists?

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It has become conventional wisdom to characterize Nazi Germany as an extreme “right wing” or “conservative” reaction against communism. There is no doubt that Hitler hated communism, which he saw as a Jewish conspiracy. Hitler blamed the Reichstag fire, which most historians suspect him of orchestrating himself, on Jewish communists. Hitler’s book, Mein Kampf (My Struggle), contains page after page of Hitler railing against the lies and the evils of communism. Does that make Hitler a “right wing conservative?” If by “right wing conservative,” we mean that he was an advocate of free markets, property rights, low taxes, and low regulation, then definitely he was not. The name “National Socialist” should be some indication of what Hitler’s economic policies were, and the plain facts of history bear that name out. Nevertheless, the Nazis are almost universally regarded as “right wing conservative extremism,” a misconception with more ominous ramifications than are obvious at first glance.

Investigation and analysis are not really needed to determine whether Nazi Germany operated under a capitalist, free market system or a socialist one. The economy was centrally planned, with wage and price controls imposed by the Goering, under the threat of concentration camp imprisonment.[1] Hitler sought foreign investment in manufacturing the Volkswagen, but because he sought companies that would not seek to make profits on the “people’s products,” American manufacturers GM and Ford dropped out of the project.[2]

When the Nazi’s came to power, unemployment was nearly 30%.[3] One of Hitler’s stated goals was to eliminate unemployment by 1939, a goal he proclaimed he met when the official unemployment rate fell under 1% that year. However, those statistics are somewhat deceiving when you consider that the Nazi’s forced women and Jews to quit their jobs and were subsequently not counted as unemployed, while unemployed German men replaced them.[4] The balance of the unemployed were absorbed into massive new government works projects to build steel plants, rubber factories, and other capital goods projects, funded by inflating the German currency that was now off the gold standard.[5]

The central planning and control did not stop at the macro level, but reached down into the life of each individual German. The right to quit your job was abolished in 1935, with consent from your previous employer required to accept another job. Trade unions were abolished, and investment was heavily regulated to serve the needs of the state rather than to encourage profit. Heavy taxes on profits made private ownership of companies virtually impossible. While the largest companies were not taxed on profits, they were so heavily controlled that they were privately-owned in name only.[6]

While the unemployment rate was made to look low by simply excluding the people that didn’t have jobs, nothing about the Nazi economy was truly sustainable. You can manipulate statistics for a while, but sooner or later reality will prevail. However, like the languishing American economy (itself suffering from the effects of the socialist New Deal), the German economy found temporary new life in building its war machine. The last of the recognized unemployed were now put to work, with the printing press of Germany’s central bank ready to provide whatever liquidity was needed. The inevitable consequences of inflating the currency were postponed once the war began, as Germany merely plundered the gold to back at least a portion of this new money from the countries they conquered.

In The Road to Serfdom, Friedrich Hayek addressed the very issue of whether the Nazis were a right wing or left wing movement. His thesis was that not only were the National Socialists every bit as socialist as their name, but that they were the natural result of socialism itself. Hayek warned his present-day England that they were traveling down the same “road to serfdom” that Germany had traveled decades before, and that he feared that socialism in England would lead to the same horrors there that it had lead to in Germany – that socialism MUST lead to wherever it is practiced.[7]

So, in terms of economic policy, the Nazis were every bit the “National Socialists” that their name suggested. However, they were also militaristic. Hitler launched aggressive, unprovoked wars against Czechoslovakia and Poland. Doesn’t that make him a “right wing conservative?”

Again, it is not “conservative” or “right wing” by any definition that we have ever used here in America until very recently. As Ron Paul pointed out time and again in his presidential campaign, the conservative position has always been anti-war and non-interventionist. Prior to the “neo-conservative” Republicans, the Republican Party always ran on an anti-war platform. It was a Democratic President that took us into every conflict we fought in the 20th century: Woodrow Wilson in WWI, Franklin Roosevelt in WWII[8], Truman in Korea, Johnson in Viet Nam.[9] Conversely, it was conservative, right wing Republicans that opposed each of these wars. “Mr. Conservative” Robert Taft actually opposed the U.S. joining NATO. Even the “right wing extremist” Barry Goldwater ran in 1964 on ending U.S. involvement in Viet Nam. Despite the Democrats’ success in characterizing Goldwater as a “nuke the commies” nutcase, the plain facts are that Goldwater campaigned against the war in Viet Nam and Johnson campaigned for it.

Nazi Germany was arguably the most horrible totalitarian society in history. By characterizing the Nazis as “right wing,” socialists proceed to make the argument that “conservative, right wing” philosophy – i.e. individual liberty, free markets, low taxes, less regulation – spawns a brutal totalitarianism when taken to the extreme. Therefore, any society built upon these principles has to be carefully guarded and imbued with the virtues of socialism to protect against the horrors of another Nazi Germany. In other words, too much freedom leads to totalitarianism, while government control protects us against it. To borrow my favorite line from Ron Paul’s Revolution, “If you think this sounds fishy, then you understand it just fine.”[10]

Welfare and warfare have always gone hand in hand in political ideology. Wherever you have found one, you have usually found the other. We have lost sight of the fact that the two are not merely related, they are actually siblings, or at least first cousins. Welfare is the use of government force to loot individuals and redistribute their wealth. Warfare is the use of government force to loot foreign nations (and their individuals) and redistribute their wealth. They are really one and the same ideology. Both are the antithesis of individual liberty. The only question one must ask in determining what is “right wing conservatism” and what is not is this: Does this policy support individuals dealing with each other by mutual, voluntary consent, or is the initiation of force involved? If the answer is mutual, voluntary consent, the policy is “right wing conservative.” If the answer is the initiation of force, it isn’t.

Ron Paul has been called by some a “right wing extremist.” He is. Ron Paul rejects the initiation of force without compromise or moderation. He is truly the last “right wing conservative” in American politics. This is not an encouraging sign. Already, the terms are being redefined once again.[11] A recent news story on the presidential election characterized Barack Obama’s recent support of the changes to FISA as a move “toward the center,” as was his support of AIPAC and strong rhetoric regarding defense of Israel. It is fair to say that economically, Obama is as far left as we have seen in a presidential candidate in decades. John McCain is considered “conservative” because of his strong support for the war and his support for government encroachment on civil liberties in the name of “security” against terrorism. Neither Obama nor McCain question the need for Medicaid, Medicare, Social Security, or Welfare. Property rights and free markets are completely off the table. Where are the right wing conservatives?

I wrote at the beginning of this article that the misconception of the Nazis as an extreme right wing, conservative movement had ominous ramifications. Let us look back at history in Germany and speculate for a moment about our own future. Before the Nazis came to power, there was a socialist government in place that is best known for the most famous currency destruction in history. In the last days of the Weimar Republic, pictures of citizens carrying the near worthless currency to the supermarket in wheelbarrows illustrated the economic state of the nation. It was this crisis that allowed the Nazis to come to power.

We now have a nation that is thoroughly fed up with the Republican administration of the past eight years. The Republicans lost Congress in the previous mid-term election. Obama has a double-digit lead over John McCain. The public has become confused into thinking that the debate is between “right” and “left,” when in fact there is no “right” in this debate. Why is this ominous?

Let us suppose that Obama wins a landslide victory. It will be hailed as a mandate from the people for all of his policies. While Obama is still officially against the Iraq War, he is not against the rest of the American Empire. So, financially speaking, Obama may cut defense spending by about $150 billion dollars. That would not erase the federal deficit. In fact, the federal government currently spends more on providing the poor and elderly with healthcare than it does on its entire defense budget, and Obama wants to cover EVERYBODY. His positions on other forms of welfare, both direct wealth redistribution and the more covert brand via government intervention in the marketplace, are for much, much more.

America already has a crisis on its hands due to decades of inflating its currency. By comparing its $1.5 trillion entitlement spending to its $650 billion defense spending, it becomes obvious that a 20% decrease in defense spending combined with even a 10% increase in entitlement spending is going to ADD to the deficits, not decrease them. Such an entitlement increase may actually be very conservative when converting some of Obama’s rhetoric to U.S. dollars. Imagine a U.S. in much worse economic crisis four years from now, with inflation that makes today’s problem look mild, and with a citizenry that now blames “the liberal left” for everything. Where will they turn?

An Obama presidency accompanied by a Democratic House and Senate could accelerate an economic cataclysm that, fairly stated, is coming, no matter which party is in power. However, with most Americans considering the neo-con Republicans as the “right wing,” it will be this brand of Republican that America turns to four years from now. With economic decline accelerating, the so-called “neo-cons” could be swept into power in four years with a stronger mandate than the Democrats had in this election. This is a party that has demonstrated its unrestrained desire for war at any cost, its utter disregard for individual liberty, its record-setting government spending, its policy of spying on its citizens, and its policy of unwarranted arrest, imprisonment, and torture. At what time in history have we seen such a unanimous mandate from the people for a political party like this? Do we really think that it couldn’t happen here?

Tom Mullen

[1] https://en.wikipedia.org/wiki/Nazi_Germany#Economy
[2] https://en.citizendium.org/wiki/Adolf_Hitler
[3] https://www.historylearningsite.co.uk/nazis_and_the_german_economy.htm
[4] https://www.search.com/reference/Nazi_Germany#Economic_policy
[5] https://www.search.com/reference/Nazi_Germany#Economic_policy
[6] https://en.wikipedia.org/wiki/Nazi_Germany#Economy
[7] F.A. Hayek The Road to Serfdom (rather than cite specific passages, the reader is encourage to read the entire book, as this topic is its central thesis
[8] It is only fair to point out that after the attack on Pearl Harbor, FDR had unanimous support for a declaration of war on Japan. However, if you examine FDR’s foreign policy before the attack, which many historians regard as having provoked Japan unnecessarily, you will find that it was “conservatives” that were opposed to it.
[9] While the United States had “advisors” in Viet Nam as early as the Eisenhower administration, Viet Nam did not become anywhere near a full scale war until Johnson’s first full term –after the 1964 election. Kennedy has planned to get the U.S. out of Viet Nam while the commitment was still minimal enough to do so.
[10] Ron Paul The Revolution: A Manifesto pg. 141
[11] Remember that the term “liberal” was used 100 years ago to describe what later became the “conservative” position of the 1950’s and 1960’s. In 2008, neither “conservative” nor “liberal” mean what they have in the past.

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>Moderation: A Virtue or Tyranny’s Secret Weapon?

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>“Don’t go to extremes.” What could be sounder, more reasonable advice? Moderation is extolled everywhere as one of the highest virtues. Drink in moderation. Enjoy good food in moderation. Take an interest in your favorite hobby – in moderation. Too much of a good thing can be just as bad for you as poison, right? “Moderation is the silken string running through the pearl chain of all virtues,” said Joseph Hall.

In civics classes, we are taught that “democracy” functions based upon compromise. Compromise brings people together. Compromise is the only way that conflicting interests can exist together peacefully. Moderation is unselfish. It respects the interest of all parties, and is willing to “give and take.” Moderation is fairness.

On the website https://moderaterepublican.net/, Moderate Republicans are described as believing:

“…that government does have a basic social responsibility to help those in need; a belief that the nation does have international responsibilities.”
“Moderate lawmakers are consensus builders. But then again the art of legislating is that of compromise, negotiation, and recognition that other views have merit. This does not mean Moderates compromise core values, but rather they understand the complexities of passing intelligent legislation that benefits the greater good.”
“Moderates were the first internationalists. The nation, they contended, had a critical role to play in advancing democracy in the world.”

I’m not sure how this platform would be considered substantially different than that of Woodrow Wilson’s in 1912. Yet, this is without question the platform of George W. Bush and the present Republican party, their 2000 campaign promises notwithstanding. The so-called “neo-conservatives” are nothing more than moderate Republicans. What could be wrong with that?

The media often describes American politics in 2008 as “extremely polarized.” Yet, any sober analysis of American politics would conclude that the debate is now between centrist, moderate Republicans and ultra-liberal, socialist Democrats. A Republican president and Congress have passed increases in entitlement spending greater than any since the 1960’s. A Democratic congresswoman has threatened to nationalize the oil industry, scarcely eliciting a mention in the media, much less a cry for her censure or impeachment. Individual liberty is so far off the table in political debate that it produces almost no results when searched on major news sites (besides the occasional article on Ron Paul). How did we get here?

I suggest that extolling the virtues of moderation has played a major role. In political debate, we are given the impression that a range of issues constitute moral dilemmas where competing but equally worthy interests must be considered and an equitable compromise reached. How do we enact legislation that supports labor while not constricting economic growth? How do we fight hate crimes while preserving free speech? How do we support Israel without inflaming further hatred among Muslims? How do we ensure healthcare to all Americans while maintaining fiscal responsibility?

None of these dilemmas are real. A government limited to its proper role faces no conflict. The litmus test in any political debate is simple: Whose liberty is being threatened? By whom? The only proper answer for the government is to defend liberty.

Using this standard, all of the so-called dilemmas evaporate. How do we provide healthcare? Government does not. It has no way to provide anything without attacking liberty. How do we support Israel without incurring more terrorism? We don’t. We take no sides and try to be friends with both. If they attack each other, we mind our own business. Our liberty is not threatened by age-old, regional conflicts on the other side of the world. How do we support both labor and management? We do neither. We enforce the sanctity of contracts and otherwise keep government out of it.

When it comes to wine, women, and song, a little moderation is a very healthy thing. When it comes to questions of liberty, I suggest that it is a deadly poison. If liberty is one extreme and slavery the other, how could we ever benefit from a compromise? Reflecting on the choices we’ve been offered over the past 100 years, we have constantly had to choose between giving up a little liberty or giving up a great deal. Government never proposes to get smaller or surrender any control. When a new government program or initiative is proposed, the choices never include more liberty. In the best case scenario, moderation carries the day, a compromise is reached, and only a little liberty is lost. However, the next debate starts from there.

Seen in this light, it is clear why an establishment bent on socialism or more government control would extol the virtues of moderation and compromise. When it comes to issues of liberty, moderation is like the old saying, “heads I win, tails you lose.” Extremism is an easy position to vilify – nobody likes an extremist. Even John McCain’s rhetoric (when he remembers his lines correctly) has shifted imperceptibly from “terrorists” to “extremists” when talking about threats in the Middle East.

I have a friend that is a few years younger than me that has always been a Democrat. Often, when we’ve debated politics, he has argued that the Republicans are crooks, the party of ignorance and religious fundamentalism. Our age difference is small but critical in that he has never known a Republican party that could be described any differently. A few months ago, he called me very excited about a television special he saw about Barry Goldwater. He went on for several minutes telling me what I already knew, that Goldwater was “a real American,” “a true patriot,” and that “there is no one in politics that is anything like him.” My friend does not remember a Republican party that would nominate such a man.

It was the present “neo-con” platform of the moderate Republicans that Goldwater defeated in 1964, although he lost the general election by a landslide. Why did he lose? He was characterized as an extremist, a label he welcomed, saying,

“Let me remind you that extremism in the defense of liberty is no vice, and let me remind you also that moderation in the pursuit of justice is no virtue.”

Critics of libertarianism often label the movement “extremist.” The most common obfuscation of the debate is to argue that “liberty doesn’t mean that you can do anything you want,” or that “liberty doesn’t mean no government at all,” as if either of these represented the true positions of libertarians. However, these arguments are effective because they use the buzz word “extremism” and count on a public that will hear that word and accept the rest without critical analysis. They certainly would not consider that perhaps extremism in the defense of liberty is a virtue.

Perhaps the only way to truly ensure liberty is to banish moderation and compromise completely. As crazy as that may sound at first, a little reflection reveals otherwise. If liberty means never to initiate the use of force, what is the moderate position? Initiating a little force? If liberty says that taking the fruits of someone’s labor without their consent is stealing, what is an acceptable compromise? Stealing a little? If liberty says that a person’s life is his own to do with as he wishes, so long as he does not violate the rights of others, what does the moderate say? Is his life only partly his own? Before rejecting extremism in the defense of liberty, revisit these questions and ask yourself this: Do we really want liberty in moderation?

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