Category Archives: Non-Aggression Principle

>The Forgotten Right

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>“The moment the idea is admitted into society that property is not as sacred as the laws of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence. If ‘Thou shalt not covet’ and ‘Thou shalt not steal’ were not commandments of Heaven, they must be made inviolable precepts in every society before it can be civilized or made free.”

– John Adams (1787)[1]

It is starting to become apparent to even the most disinterested observer that something much bigger than even a worldwide recession is happening. The seeds of revolution have taken root. Iceland led the way by taking to the streets to force regime change through peaceful demonstration. The French are currently protesting en masse against their government’s bailout of the banking system. One would be naïve to think that these are isolated incidents. It is apparent that these are just early warning signs of a worldwide cauldron that is about to boil over, catalyzed by the financial and economic cataclysm that will plunge untold millions into poverty and desperation.

While I applaud the peaceful demonstrations going on in France and Iceland, I also recognize that they are premature. As did Americans in the last election cycle, these Europeans are demanding “change.” However, also like Americans in the last election cycle, they have failed to first answer the crucial questions, “From what? To what?” They have not looked within to assess who they are, what their society is, and what they want it to be. Therefore, they run the risk of simply replacing one oppressive tyranny for another.

Likewise, we will never regain our freedom in America until we address the fundamental problem in our society. I say “the problem,” because at the root of all of what we perceive as a myriad of problems, including the police state, the welfare state, the warfare state, the military industrial complex, the Wall Street oligopoly, the high cost of healthcare and education – everything – there is one philosophical problem that ultimately leads to them all: the repudiation of property rights.

It is likely difficult for most 21st century Americans to absorb this statement, based upon the fact that they have been told now for generations that property is about greed, that accumulating property is oppression, or even that “property is theft.” However, let us look back at the philosophers who inspired our founders and see what they have to say about property. Of course, as I have written here, the primary philosophical basis for the American Revolution came from Locke. What did Locke have to say about the purpose of government?

““The great and chief end, therefore, of men’s uniting into commonwealths, and putting themselves under government, is the preservation of their property.”[2]

Certainly this statement must be startling to most 21st century Americans, who believe that they are supposed to look to their government to fight unemployment, manage the economy, ensure access to healthcare, promote democracy abroad, and pursue a myriad of other ends outside of protecting property. Surely, Locke has over-emphasized property rights here, has he not? Certainly he is alone in his simplistic assessment of the role of government, is he not?

He is not. In seeking guidance on how to construct our government, the American founders also looked to the ancients, particularly the Roman Republic. There, we find Cicero writing,

“For the chief purpose in the establishment of constitutional state and municipal governments was that individual property rights might be secured. For, although it was by Nature’s guidance that men were drawn together into communities, it was in the hope of safeguarding their possessions that they sought the protection of cities.”[3] [emphasis added]

The conditioned response of Americans today is to view these ideas as a defense of one class of people at the expense of another. We have been trained to associate “property” as a concern of the “property class,” or in more common American terms, “the haves,” as opposed to the “have nots.” This is a great deception that has lead directly to our ruin. In fact, it is the poor and those of modest means for whom property rights are most important. It is they who, not possessing significant material wealth, must all the more jealously guard the property that they do have. In the end, however, we are all property owners when one considers the most fundamental, most important property of all: our labor itself.

We learn from Locke that all property has its roots in labor. In order to survive, man must work to produce the means of his survival. This is true for people no matter what their financial circumstances. The doctor, the lawyer, the construction worker, the janitor – yes, even the Wall Street financier – must sell his efforts to his fellow man in order to acquire the means of his survival. Therefore, whoever has control over the individual’s labor has control over the individual’s life, and control over the individual’s future. If I steal all of your possessions, you can acquire more. However, if I appropriate your labor, I own all of the property you can ever or will ever acquire. This is an undeniable reality that we have lost sight of, to our peril.

America was founded upon the idea that each individual had an unqualified right to the fruits of his labor.[4] This more than anything was what the founders meant when they spoke the word “liberty.” It was the extent to which this right was respected that made America different than every other society in history, before or since. This was the great secret that made America the engine of prosperity and innovation that it was. This is what made America the land of opportunity to change one’s lot in life. It was this right that gave birth to the American dream.

However, we no longer hold this right up above all others. Instead, we have become a society that is based upon competing groups seeking to plunder each other via the force of government. The rich plunder their neighbors with corporate bailouts, subsidies, and regulatory fascism. The middle class plunder their neighbors with Social Security, Medicare, and criminal unions. The poor are forced to accept legal plunder that they do not want and which provides them with the most miserable quality of life, when the stolen capital that underwrites it could employ them all if it weren’t seized from its rightful owners. Of course, these examples are only the tip of the iceberg; there is much, much more. Virtually every political movement in America is based upon a promise to provide its followers with other people’s property.

This scenario is neither unprecedented nor has it been unrecognized by the great lights of liberty. Bastiat wrote,

“Men naturally rebel against the injustice of which they are victims. Thus, when plunder is organized by law for the profit of those who make the law, all the plundered classes try somehow to enter — by peaceful or revolutionary means — into the making of laws. According to their degree of enlightenment, these plundered classes may propose one of two entirely different purposes when they attempt to attain political power: Either they may wish to stop lawful plunder, or they may wish to share in it.”[5]

This vision of Bastiat’s has become reality in America. However, it cannot go on forever. Fortunately for humanity, a society based upon legal plunder is ultimately unsustainable. Just as respect for property rights provides the means to prosperity, violation of them leads to poverty and want. As force replaces voluntary exchange, productivity decreases, and subsequently more force is required to plunder even more. This cycle repeats until society is reduced to an authoritarian nightmare, the first signs of which are becoming apparent in the former “land of the free.” If the people wake up, the nightmare can end. If they continue to slumber, the nightmare can get much, much worse.

This is the great truth that we must rediscover before any revolution can be successful. Before we commit to “change,” we must answer the questions, “From what? To What?” The answers to those questions must be “from a nation of looters to a nation of free individuals who acquire property in the only civilized manner: via voluntary exchange.” We must reject the use of force as the means to pursue our happiness, and renew our faith in freedom. Once this great work has been accomplished, let the revolution begin.

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Check out Tom Mullen’s new book, A Return to Common Sense: Reawakening Liberty in the Inhabitants of America. Right Here!

[1] Adams, John A Defense of the Constitutions of Government of the United States of America (1787)
[2] Locke Second Treatise Ch. IX, Sec. 124
[3]Cicero, Marcus Tullius De Officiis Book II Chapter XXI
[4] “Individuals” who were included in the system. Of course, the founders recognized but did not remedy the obvious contradiction to this inherent in slavery.
[5] Bastiat, Frederic, The Law

The Lost Philosopher

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John_Locke_by_Richard_WestmacottFor high school or undergraduate college students, it is probably difficult to imagine how the dusty old books they are forced to read are relevant to their lives. Who can blame the average teenager for caring little about what lights up the face of his eccentric professor, regardless of the passion said professor may exhibit for Aristotle, Cicero, Aquinas, or Locke? Yet, despite the understandable lack of interest in the worldview of philosophers of several hundred years past, this is probably the last real chance the young student will have to consider them. Once out of school and faced with the realities of life and making a living, there is little time or motivation for one to go back and explore the world of ideas. Ideas and philosophy are for dreamers. This is how a society forgets what it is trying to do.

The enlightenment that inspired our founding fathers was a period of explosive creativity and learning. Newton, Bacon, Sidney, Hobbes, Locke, Rousseau, Smith – these giants were all children of the enlightenment that inspired Jefferson, Adams, Franklin, and the rest to create a society based upon reason which recognized that all men were created equal. Today, we tend to think about both the enlightenment and our founders as if they all shared one, homogenous philosophy and one vision of man and society. However, this is far from true.

“The enlightenmnet” did not produce one archetypal philosophy, but three. They were all quite well known to our founders, but only one of them informed the philosophy of liberty that made America the freest, most prosperous nation in history.  It has been the gradual erosion of those founding principles and their replacement by tenets of the rejected philosophies that has led America to the edge of ruin.

The first to talk about “the social contract” during the enlightenment was Thomas Hobbes. Hobbes believed that man in the state of nature (the absence of government or any higher authority) was in a state of perpetual war, or as he put it, “war of everyone against everyone.” This was the result of Hobbes assertion that in that state, man had “a right to everything,” following from his opinion that reason dictated only that man is restricted from doing anything to harm himself. Thus, for Hobbes man was ultimately a depraved creature who needed a strong government – an absolute ruler – to save him from himself. While for Hobbes the law of nature dictated that man should seek peace, man would never find it by employing reason, which would only ensure that he tried to preserve his own life against the “violent death” that threatened his every living moment. The purpose of government, then, was to protect man from his own depraved nature and that of his neighbors with a strong, paternal hand, sanctioned by God.

Jean-Jacques Rousseau’s vision of man and the purpose of government was quite different from that of Hobbes. Rousseau asserted that the idea of a “state of nature” was a purely academic one, having likely never actually occurred in human history. However, he did use the idea of a state of nature as a philosophical tool to develop his ideas about man in society and the purpose of government. For Rousseau, man had to give up his natural rights when entering society, and while society granted him individual rights, they could be set aside when the needs of society outweighed them. In his own words,

“Each of us puts his person and all his power in common under the supreme direction of the general will, and, in our coporate capacity, we receive each member as an indivisible part of the whole.”

Therefore, government’s purpose for Rousseau was to accomplish the “general will” and achieve the common good, which included economic equality, as Rousseau recognized man’s property rights to end at what he needed to survive. “Having his share, he ought to keep it, and can have no further right against the community.”

John Locke represented yet a third philosophy of man and society. Locke’s view of man in the state of nature was vastly different from that of Hobbes, as was his definition of reason. As he said,

“The state of nature has a law of nature to govern it, which obliges every one: and reason, which is that law, teaches all mankind, who will but consult it, that being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions.”

So, for Locke, reason did not merely dictate self-preservation, but the Non-Aggression Principle as well. While Locke recognized that man was not safe from harm from other people in the state of nature, he believed that the laws of nature preceded man and society, and thus individual rights were inalienable. Man did not give up those rights when entering society, but instead entered society solely for the purpose of defending them. He had a right to as much property as he could legitimately acquire, whether that resulted in more property than possessed by his neighbor or not. So long as he did not harm another in their “life, health, liberty, or possessions,” he was free to “order his actions as he pleased.” The purpose of government for Locke was to protect life, liberty, and property as the societal extension of the individual right of self defense.  This was also government’s strict limit.

It is interesting to consider how these three philosophies played out during the 18th century. In America, our founders chose the philosophy of Locke, specifically excluding the other two in writing our Declaration of Independence. However, our founders were not of one united mind on their vision of the most effective form of government. In fact, there was a deep divide between two factions, led by Alexander Hamilton and Thomas Jefferson, respectively.  Jefferson believed in the philosophy of Locke, whom he on more than one occasion named (along with Newton and Bacon) “one of the three greatest men who ever lived.”

Hamilton’s view of man and society was much more Hobbesian. As Jefferson put it, Hamilton was “honest as a man, but, as a politician, believing in the necessity of either force or corruption to govern man.” To Jefferson’s assertion that Locke, Bacon, and Newton were the greatest men the world had ever produced, Hamilton replied, “the greatest man that ever lived was Julius Caesar.” While Jefferson asserted that the power of the government was limited to defense against aggression, Hamilton advocated a “more vigorous government,” with the ultimate instrument of control at its disposal – a central bank.

This was the great struggle of ideas in early America. Very generally, it was a struggle between Hobbes and Locke. While Hamilton was able to accomplish many of his goals while serving in Washington’s cabinet, Jefferson’s vision ultimately prevailed by he and his successors winning the presidency, paying down the national debt, and eliminating the central bank (an accomplishment that had to be repeated by Jackson a few decades later). It was his Lockean vision that dominated, albeit under constant challenge, during the great century of innovation and prosperity that followed.

Rousseau’s philosophy did not find footing in early America, but did in France. While America’s revolution was based upon Life, Liberty, and the Pursuit of Happiness, drawn from Locke’s Life, Liberty, and Property[1], France’s revolution was based upon Liberty, Fraternity, Equality. It is no accident that one revolution was wildly successful and the other devolved into a bloody reign of terror and eventual despotism. The French had the same results trying to achieve economic equality through the force of government that later collectivist societies would under communism.[2]

While America lived by Locke’s principles, she enjoyed a meteoric ascent, leading the industrial revolution and creating much of what we now call the modern world. The explosion of prosperity for common people that occurred during America’s first century has been unequaled in human history. Indeed, while many are quick to point out that mass production was invented in America, let us not forget mass consumption – the enjoyment by the common people of the bounty that living by Locke’s principles of freedom and individual rights had provided.

By now, the relevance of these three philosophies should have jumped off the page. While all three competed during the enlightenment, only two have informed the political parties in America for the past century. It is no coincidence that today virtually all Americans feel that they must vote for “the lesser of two evils” when choosing representatives in their government. It is because they are choosing between the Hobbesian Republicans, with their strong, central government, sanctioned by God to save people from themselves, and the Rousseaian Democrats, still striving to use the force of government to achieve their perverse vision of economic equality, despite the tens of millions that have died as a result of that same vision. Gone are the individual rights, liberty, and Non-Aggression Principle of Locke, and with Locke’s philosophy has gone America’s greatness.

Most ominously, the two parties that previously followed either Hobbes or Rousseau are now merging together into a terrifying hybrid, finding common ground in their mutual belief in the absolute sovereignty of the state over the individual. While they may have appeared radically different in decades or centuries past, these two philosophies have always had this in common. In the end, that makes them for all practical purposes the same.

However, all is not lost. While Locke has completely disappeared from the American ethos, his philosophy can never really die. Very soon, the artificial society created by the Hobbes/Rousseau hybrid is going to collapse upon itself, a victim of its own systemic flaws. The supreme justice in the universe is that society cannot violate natural rights indefinitely. Just as market forces eventually reassert themselves in economics, natural law eventually does so in the organization of society as a whole. When the use of force can no longer sustain society, as it ultimately never can, voluntary exchange will take its place. As the illusion of legitimacy disappears from the present paternal state, the Non-Aggression Principle will reemerge to replace it. Do not fear the coming collapse. Embrace it. When the moment comes, let us seize it and shout joyously, not for equality or security, but for liberty.

[1] Property being implicit in “the Pursuit of Happiness”
[2] Tragically, the cause and effect relationship between the economic policies that accompany a government striving to achieve economic equality (at the point of the sword) and the subsequent famine, war, and destruction that result still eludes us. It was demonstrated in France in the 18th century, Russia in the early 20th and China later in the 20th, yet history seems to have taught us nothing. The voices crying for government-enforced equality, perhaps this time under the guise of “spreading the wealth,” are louder than ever.

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

>A New Declaration of Independence? No You Can’t!

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>I knew that there would come a day when I would not just roll my eyes at something our new president said, but instead would be gripped by genuine, cold fear. I thought that at least the traditional honeymoon period would go by (the first 100 days in office – when we would be treated to meeting the new president’s dog, watching him wave during cornball photo ops, and generally doing nothing of real substance) before he said something that truly terrified me. However, if I have to find something good to say about “the savior,” it is that he has certainly hit the ground running. The only problem is that he is trying to get us all running toward our mutual destruction.

In a speech on Saturday in Baltimore, he said words that should be sparking mass protests all over the United States. President Obama has called for “A New Declaration of Independence,” which of course would provide the ideological backdrop for his plans to try to “perfect our union.” So that I am not taking his words out of context, I will quote him verbatim based upon the official transcript provided by his staff.

“And yet while our problems may be new, what is required to overcome them is not. What is required is the same perseverance and idealism that those first patriots displayed. What is required is a new declaration of independence, not just in our nation, but in our own lives – from ideology and small thinking, prejudice and bigotry – an appeal not to our easy instincts but to our better angels.” [emphasis added]

It will certainly be argued that this was just a rhetorical figure of speech, as Obama did not actually call for the drafting of a document. The dreaded words are certainly watered down by what follows them, making the statement seem more like an appeal to each person to make some sort of personal commitment to help make a better world. However, I here and now warn the reader not to write this statement off as just another speech. During his campaign, Obama repeated the words “service and sacrifice” so many times that it is likely that most Americans now feel that service and sacrifice are now required of them. Of course, the questions, “Serve whom?” “Sacrifice what?” and “For whom?” were never answered, but they certainly will be when our new emperor begins dictating policy to his rubber stamp Congress.

It should come as no surprise when we hear these new words from Obama again and again, until one day a story breaks that someone is actually working on a new declaration. Likely we will be told that this person – maybe a Congressman, maybe some other servant of the empire – was “so inspired” by Obama’s ideas that he decided to take him up on this one. It will of course be served up as the spontaneous action of this inspired person, and will be lauded as one of many wonderful results of Obama’s “transformative presidency.” Whether the official story is true or not will not change the disastrous results.

Most Americans reading this would probably wonder why a new declaration would be such a big deal. After all, the original Declaration does not have the force of law. Why would a new one constitute any substantive change?

While it does not have the force of law, the Declaration of Independence is monumentally important. It is not law itself, but the declaration of what the purpose of every law passed is supposed to be. As that document says, our government only exists to secure our individual, unalienable rights. Therefore, we declare in that document that we shall only pass laws whose purpose is “to secure these rights.” Implicit in “the Pursuit of Happiness” is the central, most important right: the right of each individual to the fruits of his labor.

As I argue in my book, this is the right without which no other rights can exist. This was the central theme in Locke’s Second Treatise of Civil Government, which was the direct source for our Declaration by Jefferson’s own (repeated) admission. This was the true reason that our American Revolution was fought. We have ignored this plain fact for too long, as our increasing loss of liberty proves.

Unlike our last president, President Obama does not have the dubious freedom that a more limited intellect can provide. He knows how troublesome the original Declaration is to his agenda. While it still stands as our declaration of what our government is supposed to be doing, it stands in the way of what he wants our government to be doing, regardless of the fact that our government already violates its principles in so many ways.

Like the United Nations “Universal Declaration of Human Rights,” I would anticipate that Obama’s new declaration would grant additional rights to everyone, including a minimum standard of living, healthcare, unemployment benefits, and the rest of the entitlements granted in Article 25 and beyond in the U.N. document. At first, that might seem like a great idea. How can more rights be bad?

The answer is that the price of these new “rights” is the surrender of the most important of the true natural rights – the right to the fruits of your labor. For example, “healthcare” is nothing more than the fruits of the labor of healthcare providers: doctors, nurses, technicians, hospitals, etc. Therefore, no one can have a right to healthcare. If the doctor has a right to the fruits of his own labor, then other people cannot have a right to that same labor. It is a logical contradiction. In order for everyone to have a right to the doctor’s labor, either the doctor – or whoever is forced to pay the doctor’s bills for “everyone” – must give up the right to their labor. No one can have a right to something that someone else must be forced to provide – at least not in a society that wishes to be “the land of the free.”

Of course, I am certainly not the first to point out that the U.N. Universal Declaration of Human Rights was modeled on the Soviet Union’s Constitution, not ours. That is why it grants the “non-rights” that it grants – because it is based upon communist philosophy. Granting everyone a right to the fruits of everyone else’s labor is the definition of communism, and almost all of President Obama’s rhetoric is consistent with it. He never talks about protecting the individual. Instead, he says “out of many, we are one.” We all have a responsibility of service (to the collective) and sacrifice (for the collective). We have no protection from the collective, no matter what they demand out of our labor or out of our hides.

However, our Declaration of Independence stands in the way of all of that. Unlike his predecessor, President Obama is an intellectual and he knows that the Declaration can still provide an impregnable defense against his monstrous plans, if only the American people would rediscover its meaning. Once a new declaration is in place, he can make the argument that the old one is outdated and that “we have all agreed” that “the challenges of the 21st century” demand a different role for our government.” While rights are unalienable and therefore cannot be taken away, they can certainly be violated. A house resolution recognizing a new declaration of independence would provide strong support for just that.

This is a line that our government must not be allowed to cross. From this day forward, each time President Obama mentions a new declaration of independence, our voices must be raised together in deafening unison: No You Can’t! No You Can’t! No You Can’t! (I can’t hear you) No You Can’t!

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>Liberty’s Greatest Commandment

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>“Our legislators are not sufficiently apprised of the rightful limits of their powers; that their true office is to declare and enforce only our natural rights and duties, and to take none of them from us. No man has a natural right to commit aggression on the equal rights of another; and this is all from which the laws ought to restrain him.”

– Thomas Jefferson (1816)[1]

The great spiritual movements of history have imparted spiritual truth to those who “had ears to hear.” Inevitably, religions have commandeered those movements and replaced that spiritual truth with authoritarianism. The great spiritual masters (real and legendary), such as Krishna, Paul, Jesus, Mohammad, and Buddha (just to name a few), have all offered their followers the chance to live a better life, to become more than they were, and to set themselves free from the physical bonds that limit their mortal lives and spiritual growth. Too often, those who have come after the masters have replaced their sublime wisdom with a myriad of rules, rituals, and mysticism that ultimately confuses or even contradicts the original message.

As just one example, Jesus was able to condense all of the laws and commandments of the Hebrew Scripture into two simple principles, recognizable at once to most Christians,

“The first is this: ‘Hear, O Israel! The Lord our God is one Lord. You shall love the Lord your God with all your heart, with all your soul, with all your mind, and with all your strength. The second is this: ‘You shall love your neighbor as yourself.’ There is no other commandment greater than these.”[2]

This short passage contains all that Jesus thought necessary in instructing his followers on how to live. Indeed, the scribe that asked him which commandment was the greatest is so impressed by what Jesus says, that he replies that following these two precepts “is worth more than all burnt offerings and sacrifices.”[3] Unfortunately, the Catholic Church that evolved from this movement did not adhere to this philosophy, as it became one of the most oppressive in history in the ensuing centuries. While the gospels depict small groups of seekers gathered around an enlightened master, the Catholic Church organized itself into an authoritarian hierarchy, often using the threat of eternal damnation to gather earthly wealth or power. While Jesus instructed his followers to break the rules when the rules stood in the way of virtue,[4] the Christian religions, like so many others, have confused the rules with the intentions behind them, and the dogma for the spiritual truth. In fact, the edifice of ritual built up by the various Christian churches arguably impede their followers from finding God, and one need not look far for examples of those churches violating the second great commandment over and over again. Unfortunately, the Christian churches are in no way unique in this respect.

Liberty, too, has suffered this fate. Like the great religions, Liberty was a movement that once set people free. It was founded by an enlightened group of masters, named Locke, Jefferson, Adams, and Paine. Like the great religions, Liberty also had a central principle – a greatest commandment – that could inform its followers in every aspect of their lives. We have come to know this precept as the Non-Aggression Principle, which is the principle that each individual has the right to do whatever he or she wishes, as long as he or she does not violate the equal rights of others. Today we mistakenly associate this principle exclusively with libertarians or objectivists.[5] However, as the quote from the subtitle of this passage demonstrates, the Non Aggression Principle did not originate with either of these 20th century movements. In fact, not only is the Non Aggression Principle explicit in the writings of Jefferson and Locke, it is actually the definition of Liberty itself.

Like Christianity, Judaism, and the ancient spiritual movements that came before them, Liberty was a great spark of light in its infancy. Never before had men in society proclaimed to the world that all men are created equal, and that they are endowed by their Creator with unalienable rights. Never before had people actually put the Non Aggression Principle into practice, and attempted to limit the laws of society to its standard. Never before had people attempted to truly live together as equals, and come so close to true freedom and justice.

Jesus gave two greatest commandments, because he was instructing his followers in living two different lives. His first commandment applies to the inner life – the spiritual life. His second commandment applies to the outer life – life on earth and among men. While Liberty’s great commandment only explicitly speaks to the latter, it is consistent with not only both of Jesus’ two greatest commandments, but with the spiritual and moral teachings of all spiritual movements. In this way, the Non Aggression Principle transcends religion, as it excludes none and supports the moral teachings of all.

Religious freedom is implicit in the Non Aggression Principle. As the thoughts, prayers, and beliefs of one person can of themselves do no harm to anyone else, following the Non Aggression Principle necessarily grants religious freedom to all. As Jefferson put it,

“The legitimate powers of government extend so such acts only as are injurious to others. But it does me no injury for my neighbor to say there are twenty gods or no God. It neither picks my pocket nor breaks my leg.”[6]

Here Jefferson both succinctly restates the Non Aggression Principle and draws its obvious conclusion about religion: no man’s inner life can harm another, and thus is outside the reach of government. Therefore, the Non Aggression Principle allows everyone to follow the spiritual teachings of any religion he wishes, or no religion at all. His inner life belongs to him and to no one else.

Regarding man’s outer life, the Non Aggression Principle is consistent with Jesus’ second commandment, and with the moral teachings of virtually all religions. It is not a very far reach to say that to “love your neighbor as yourself” is substantively the same as “to grant your neighbor the freedom to do what he pleases, as long as he harms no one else.” Nor is this message much different from those of the great masters of the other religions. Despite the outwardly different (and often antagonistic toward each other) institutions that have grown up around the other great spiritual movements, the great masters behind all of them exhorted us to love our neighbors (even our enemies), to do charitable works, and to respect each other’s property.

Unfortunately, Liberty has follwed the same trend as these movements. Those who came after the great masters have forgotten the true meaning of Liberty, and have instead built up a great, authoritarian hierarchy, complete with its own labyrinthine set of rules and dogma that consistently violates Liberty’s central principle. As the Catholic Church of late antiquity and the Dark Ages routinely violated Christianity’s central axioms, the greatest crimes in history are now committed under the sacred name of Liberty. None are more egregious than the current wars of aggression that purport to be “liberating” their victims, just as the Inquisition purported to be “saving” the victims of its sadistic tortures.

At home, the government of the so-called “land of the free” grows more authoritarian each day, routinely violating Liberty’s great commandment by seizing property to protect privileged financiers, to realize its perverse vision of forced economic equality, to punish victimless “crimes” that the members of a small, wealthy oligarchy find distasteful, and to tighten its control over every aspect of our lives.

As has been the case with religions throughout history, the time has come for the true believers in Liberty to reject the false teachings of the established clergy and resurrect the true message of the founding masters. While our own Sadducees and Pharisees (Republicans and Democrats) would have us believe that our problems are terribly complicated, they are not. They can be solved one and all by applying one simple principle: the principle of Liberty. If we were to at least limit the government to the limits set by Jefferson and Locke, every problem we currently consider paramount would disappear. For example:

Legal tender laws force U.S. citizens to accept U.S. dollars as payment, and forbid contracts to be denominated in gold. Using alternative currencies doesn’t represent aggression against anyone, so according to the Non Aggression Principle those laws would have to be repealed. This would immediately break the hold of the Federal Reserve over the economy, and would quickly end the problem of inflation. Prices would begin falling again, as they did throughout the 19th century. 100 years from now, the general price level would be half what it is today, as it was half what it was in 1800 by 1912. Can you imagine a world in which you could tell your grandchildren, “I used to have to pay twice that much for what you just bought?”

Applying the Non Aggression Princple means ending Medicare, Medicaid, Social Security, and the rest of the wealth redistribution programs, because the money is forcibly taken from taxpayers to fund them. This would solve a myriad of problems. First, it would return $1.5 trillion in savings/capital to the economy, taking the United States from a negative savings rate to an over 11% savings rate. In addition, the artificial demand created by government in the healthcare sector would disappear, allowing prices to fall back to their natural levels. Healthcare would be affordable without insurance, as it would be subject to the same market forces that keep the prices of more necessary products like food and shelter affordable (to the extent that they too are not distorted by government).

This also means cutting at least 70% of our military expenditures, as we would have no business stationing troops anywhere but at our own borders. Without our military presence antagonizing the dispossessed overseas, the motivation for terrorism would quickly fade. We would add another $400 billion or so in savings/capital to the economy which is currently being devoured by government. Most importantly, hundreds of thousands of people, including over 4,000 of our own brave men and women, would be alive today to celebrate the holidays with us.

The Non Aggression Principle forbids laws against drug use, freeing about 2/3 of our prison population. Contrary to government propaganda-induced public opinion, this would not set off a crime wave, as the vast majority of these people have never committed a violent crime. In addition, the funding source for most of our criminal gangs would dry up, making it impossible for them to arm themselves the way they currently do. Like the prohibition of the 1920’s, the Drug War has resulted in a huge black market and criminal industry to supply the outlawed contraband. Without the Drug War, drug dealers and criminal gangs would go the way of the bootlegger. Last but not least, add 41 billion more to the savings/capital column.

In addition to not allowing the government to seize property from one person and give it to another, the Non Aggression Principle would not allow government to use taxpayer money as collateral for loans, as it does with Fannie Mae mortgage loans and student loan programs. This would eliminate two more huge bubbles caused by government-created artificial demand. We have already seen the housing bubble burst. The next big bubble to burst will be student loans.[7] Only because of government distorting the market with artificial demand – and in violation of the Non Aggression Principle – could tuition prices ever have risen so high. Both students and their parents are now going deep into debt in order to finance college tuition, which students at one time could finance with summer and part time jobs. If government was not allowed to guarantee the loans with taxpayer money (by force), the prices would be limited to what the market could bear.

One could write volumes on government’s violations of the Non Aggression Principle, and the wonders that could be achieved simply by adhering to it. However, solving the problems of inflation, healthcare costs, housing, education, war, terrorism, and recessions is a pretty good start. If you take the time to think it through, you will find that this principle – Liberty – can solve every societal problem we face, no matter how insoluble our politicians try to make them seem. Only our refusal to reason through them allows these problems to persist.

So, as we enter another holiday season, let us look past ritual and custom to the true meaning behind the spiritual movements we follow, and may each of us find our own inner path to salvation. Outwardly, let us revive the true meaning of Liberty. Let us cast the money changers out of our American temple, and put our swords back in their sheaths, both in dealing with our neighbors in other countries and here at home. Let us reject the false teachings of our political priesthood and return to the lessons of Liberty’s great masters, who warned us of the evils that presently afflict us but taught us the secret wisdom that can defeat them all. It is within our ability to make this New Year a rebirth of our American spirit, our freedom, and our prosperity. For this transformation to occur, we merely need to keep one New Year’s resolution: to live by Liberty’s Greatest Commandment. Free people need nothing more than this.

Check out Tom Mullen’s new book, A Return to Common Sense: Reawakening Liberty in the Inhabitants of America. Right Here!

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[1] Jefferson, Thomas Letter to Francis Walker Gilmer June 7, 1816
[2] Mark 12:29-31
[3] Mark 12:33
[4] Luke 6:9
[5] Followers of Ayn Rand’s philosophy of Objectivism
[6] Thomas Jefferson, Notes on Virginia, Query XVII 1782
[7] With the unemployment that will accompany the coming depression, it is inevitable that a much larger percentage of these loans will begin defaulting, creating a new leg to the crisis. The positive consequence of this would be the necessary adjustment in tuition prices that would take place if the market were left alone by the government. Unfortunately, government has repeatedly shown that it will do everything in its power to fight these necessary price adjustments, which only serves to prolong the crisis.

The Bill Clinton Myth Finally Debunked

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clintonWhether you are watching the stock market, the headlines, or merely your 401K account balance, there is not much positive about the economic collapse just getting underway in the United States. With each new negative earnings report, bankruptcy, and ominous unemployment report, it gets a little harder to see any silver lining around the black cloud. However, there is one positive consequence of the economic debacle: The Bill Clinton Myth has finally been debunked.

Most people are familiar with the Myth, but mistake it for history. It’s a wonderful story if you are a Democrat or other variety of government-worshipper. For those who practice that religion, the Bill Clinton years serve as a Golden Age to talk about, write about, maybe even pray about, hoping for their return.

Unforunately, this myth does not even offer the benefits of its more interesting ancient predecessors. While the ancient myths of gods and monsters contained spiritual and philosophical truth underneath their obviously fictional storylines, the Bill Clinton Myth contains no truth at all. Perhaps “myth” is the wrong word, because it gives good myths a bad name.

The Bill Clinton Myth goes something like this. After “mismanagement” of the economy by President George H.W. Bush, which resulted in the recession that coincided with the 1992 election, Clinton took office and “managed the economy” wisely during his eight year presidency. Clinton’s “centrist policies” were just what the economy needed at a time of technological revolution, and his wise stewardship resulted in not only unprecedented growth and low unemployment for the economy, but balanced budgets and even surpluses for the federal government. By the time Clinton left office, the United States was more powerful economically than it had been at any time in its history.

Like the Populist Myth of the 19th Century, this one is a great story, but none of it is true. While even some Republicans begrudgingly credit Clinton with the mythical budget surpluses or the equally mythical prosperity in the 1990’s, they do themselves a disservice in regard to their quest to discredit every Democrat who ever (or will ever) lived.

In reality, there were no federal government surpluses. The lion’s share of the prosperity was a Federal Reserve-created bubble (the dot com bubble) and what real economic growth there was occurred despite Clinton’s policies, not because of them.

It might be necessary to go back and read that last sentence again. It is heresy, as surely as Galileo’s heliocentrism was to the Inquisition. It’s also just as true.

First, the so-called “surpluses” were bogus. As Craig Steiner explains, the appearance of a surplus was merely increased tax revenues from the dot com bubble allowing the Clinton administration to borrow more money from Social Security. While the public debt went down in the last four years of the Clinton presidency, the intergovernmental debt (mostly to Social Security) went up by an even greater amount, resulting in an increase in the national debt in each of those years. These are easily verifiable facts out of the published federal government budgets for those years. Anyone who doubts this can simply look up the budgets from 1997- 2001 and see the deficits for themselves.

Certainly, there were astounding developments in technology in the late 1980’s and throughout the 1990’s. One could look at this decade as a mild version of the technological revolution that occurred at the turn of the 20th century, although the breakthroughs, mostly in computing, were not as paradigm-shifting as the invention of the steam engine or the automobile, much less the telephone or the computer itself. These advances resulted in vast increases in productivity. A whole industry  was born, employing people in higher paying jobs and revolutionizing communication, commerce, and production.

All of this happened during Bill Clinton’s presidency, although its roots go back at least as far as the Reagan years, possibly even Carter. But what did Bill Clinton do to cause this technological revolution? Nothing. Microsoft, Oracle, Apple, and the rest of the real new companies that emerged during this technological revolution were children of the free market. Gates, Ellison, Jobs and the rest were all entrepreneurs who took enormous risks based on their superior vision of where breakthroughs in technology could take commerce.

Anyone old enough to remember knows the government had very little understanding of the tech sector and frequently complained it didn’t know how to regulate the new types of products or business processes the tech sector presented. In other words, much of the reason for the explosive growth was the absence of government involvement. Until the lumbering machinations of government caught up, a free market in technology existed that allowed for spectacular innovation and growth.

The most significant action undertaken by the Clinton administration regarding the tech revolution was its anti-trust case against Microsoft. Here, Clinton’s contempt for free markets and property rights came shining through. This particular anti-trust case had a bizarre twist, as it was based upon the ludicrous assertion that Microsoft had some responsibility to build opportunity for its competitors into its own product. As usual, the government tried to “ensure competition” by using its coercive power to cripple the leader, rather than protect the property rights of all.

There was another side to the tech revolution that wasn’t the natural result of free markets: the dot com bubble. This was Pets.com, online supermarkets, and other hare-brained schemes that only got capitalized due to the reckless monetary policy pursued by the bubble-maestro himself, Alan Greenspan.

To be fair, Clinton doesn’t deserve much blame for this bubble. Most politicians demonstrate little understanding of monetary policy, beyond their belief that lower interest rates raises stock prices and higher stock prices equals votes. At one point, Clinton actually made a speech in which he claimed the business cycle had been eliminated.[1] That shows his understanding was as limited as most other presidents’.

Regardless, the dot com bubble had nothing to do with Clinton. It was merely the Fed doing what the Fed does, inflate and distort the economy, regardless of who happens to occupy the White House.

Finally, in addition to the false credit Clinton receives for his imaginary role in the perceived prosperity of the 1990’s, he has somehow escaped all blame for his very real hand in the problems we are facing now. Remember, it was Clinton who appointed FDR II (Franklin Delano Raines) as CEO of Fannie Mae, and then pressured the GSE to significantly increase its loans to riskier sub-prime borrowers.

The Clinton administration bragged it had not only had a hand in the first black CEO of a Fortune 500 company,[2] but also that it had made home ownership possible for millions of Americans that otherwise could not have obtained mortgages. Raines is now the subject of over 100 civil lawsuits and a huge percentage of those mortgages are defaulting. As usual, the government’s results when interfering in markets are exactly the opposite of its intentions.

Contrary to the Clinton Myth, the Clinton presidency had nothing to do with what real prosperity there was in the 1990’s. The Clinton administration was as clueless and impotent as most others while the Federal Reserve blew up an enormous bubble on its watch, sowing the seeds for the mortgage crisis that started the present economic disaster. Economically, the Clinton presidency was an unmitigated disaster, and hopefully it is clear to all but the most fervent believers that his “stewardship of the economy” is a myth.

Lest this be seen as partisan, let me clear the air. There have been two presidents credited with prosperity that seemed to coincide with their years in office during the past 40 years. One was Reagan, a Republican, and the other, Clinton, a Democrat. In both cases, they were falsely credited with prosperity that was mostly an illusion caused by the Federal Reserve. Their policies otherwise failed miserably.[3]

With the Clinton Myth exposed as a fraud, perhaps we can get rid of the entire government religion. Centuries ago, most people of the earth ceased sacrificing animals to bring rain, better crops, or good fortune hunting. They had finally realized there is no cause-effect relationship between killing a goat and the end of a drought. We need to likewise recognize that no politician has ever had any more to do with prosperity than those unfortunate goats had to do with the weather.[4] Freed from this superstition, it becomes clear that only free markets, individual effort, and creativity can create wealth and prosperity.

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.

 

[1] I recall him making this ludicrous statement, but have not been able to reference it. Perhaps someone can provide the citation in a comment.
[2] The focus by both the Clinton administration and the media on Raines, a political hack who took over a Government Sponsored Entity, was a disservice in that it distracted attention from REAL black executives, like Kenneth Chenault, and Richard Nanula, who had risen to their positions based upon their talent and hard work.
[3] To be fair, Reagan’s rhetoric was admirable. He talked constantly about lower taxes, smaller government, and more personal liberty. However, he failed to implement this ideology to any significant degree, possibly because of a Democratic Congress. More importantly, he ran huge deficits due to defense spending and the growth of entitlement programs on his watch that constituted bigger government rather than smaller.
[4] Actually, the government religion is far more harmful than the ancient religious cults. When the ancients sacrificed a goat, they neither benefitted nor harmed anyone (other than the goat). When government tries to “create prosperity,” it harms everyone in society.

 

>The Crusade Against Greed: Government’s Scapegoat

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>Despite the fact that this economic crisis is unfolding exactly the way that the Austrian economists predicted it would, along with the impending police state that Hayek predicted over 60 years ago, the American people show absolutely no sign of figuring out the CAUSE of this crisis. The most discouraging aspect of the whole debacle is the propensity of the American people to take the government bait by blaming this financial and economic collapse on “greed.” This plays right into the government’s hands.

As platitudes go, those warning against greed are the ones that people should be most suspicious of. Anyone that seems overly interested in making you feel guilty about accumulating too much property probably has an interest in acquiring what you leave behind. If nothing else, the fact that both Republicans and Democrats are vilifying greed should make people think twice about whether they may be burning the wrong witch when they seek to blame greed for our present troubles.

Webster’s defines greed as “a selfish and excessive desire for more of something (as money) than is needed.”[1] Any student of economics should be suspicious of this vice. While “selfish and excessive” certainly conjures up distasteful emotions, those are little more than prejudicial adjectives accompanying the real substance of the definition: desire for more of something than is needed. Does this mean that anyone with a savings account is greedy?

While one could counter that some savings are actually “needed,” a moment’s reflection should have one questioning what the real motivation for vilifying greed might be. Who do we find denouncing greed the most vehemently? The rich and powerful. Does this bother anyone besides me?

Let me be clear. Greed had nothing to do with causing this financial crisis, no matter how many times you are told that it did by the media and politicians looking for votes. In economics, the goal of every market participant is to acquire “more than is needed.” If the truth be told, acquiring more than is needed is what Jefferson really meant when he talked about the “Pursuit of Happiness.” Property – the fruits of your labor – is the means by which you sustain your existence and provide opportunity for intellectual and spiritual enrichment. Those who must work every waking hour just to provide the basic necessities of life have time for neither quiet meditation nor for reading Dostoevsky. By acquiring more than you need, you create leisure time to pursue your other interests and enable yourself to provide for your children or to give to charity. In this life on earth, acquiring more than you need is the means to happiness and security for yourself and those that you love. It is also your unalienable right, as our founders repeatedly told us.

The whole point of participating in a free market is to acquire as much property as you possibly can. Not only is there nothing wrong with this, it is actually vital to the health of the market. With every participant acting in their rational self interest to maximize their wealth, the minds of all participants are leveraged and society as a whole reaps enormous benefits.

One of the key mistakes that critics of free market capitalism make is failing to understand that there is only one way to acquire great value in that system: to offer great value in return. Listening to the proponents of socialism, one might be led to believe that one can only gain at another’s expense. This is not true. In a laissez faire capitalist system, economic agents trade to their mutual benefit. Every exchange is perceived by both parties to be an EQUAL exchange, or it does not occur. That is the nature of VOLUNTARY exchange. No one deliberately causes themselves harm. While they may not always trade wisely, more often than not they do, and in every case they make an exchange that they believe is in their best interests. One can only consume great wealth by producing great wealth.[2]

Thus, it should be clear that there is no such thing as acquiring “too much” in a free market. Only by supplying enormous value can any economic agent acquire enormous value. Acquiring property in a voluntary trade by offering equal value in return is the essence of “earning.” In a free market, all transactions are voluntary. Therefore, all wealth must be earned.

A second reason for wrongly perceiving a threat from greed in a free market is the failure to acknowledge the role played by risk. There is always some amount of wealth that can be acquired with very little risk. However, in order to achieve greater amounts of wealth, economic agents must accept greater amounts of risk. Risk acts as a counterbalance to what is commonly referred to as greed. If an economic agent seeks to acquire value far beyond the value he is offering in return, he can only do so by taking inordinate risk, and will virtually always fail. While the attempt to acquire value with this type of speculation might not be admirable, others certainly have no right to forcefully stop him from doing so. The risk is his, as are the gains or losses he realizes as a result. In a free market, there is no moral or economic justification for attacking “the speculator.”

That brings us to our present crisis and its real cause. It was not greed – the desire to accumulate more than one needs – that caused the crisis. What caused the crisis was government removing the risk of lending to sub-prime borrowers by guaranteeing mortgages through Fannie Mae and Freddie Mac. With no fear of losing their investment, lenders had no reason not to take inordinate risk in lending to sub-prime borrowers. In fact, Fannie Mae CEO Daniel Mudd told the New York Times that he was actually pressured by the government to continue increasing the risk that Fannie was exposed to. According to Times reporter Charles Duhigg,

“Capitol Hill bore down on Mr. Mudd as well. The same year he took the top position, regulators sharply increased Fannie’s affordable-housing goals. Democratic lawmakers demanded that the company buy more loans that had been made to low-income and minority homebuyers.”[3]

Whatever the true intentions behind creating these government-sponsored enterprises (GSE’s), they violated moral and economic law with predictable – and predicted – results. This intervention into the market and suspension of market forces was the direct cause of the sub-prime crisis, not greed.

This was more than just a bone-headed mistake by government. It was a crime. Governments are instituted to secure individual rights, including property rights. Instead of protecting the property of its citizens, government stole it to guaranty sub-prime loans. Now that its ill-advised program has failed, government is looking for a scapegoat. Enter “the greedy financier,” and the real culprit walks.

None of this is meant to absolve the lenders, who knowingly made loans to people who could not pay them back. However, the guilt should be shared equally between the lenders, the borrowers, and the government. It was not greed that they were guilty of, it was stealing. They stole money from the taxpayers to make the loans possible. All three parties benefitted by passing risk onto taxpayers without their consent. The problem was not the desire for too much wealth. It was the desire for wealth that they did not earn.

This is an important distinction, because we will soon be subject to a government “solution” to this supposed problem of excessive greed. Blaming greed for the crisis plays right into the government’s hands, as it allows government to respond with measures that will limit the amount of money that can be earned, even legitimately. Already we are hearing calls for more regulation. This amounts to a further violation of our rights and will continue the destruction of our markets. On the other hand, if we recognize the true cause of the crisis, we can demand less regulation and an end to government intervention into the marketplace, which is what our markets actually need. One cannot prescribe the medicine until one has accurately diagnosed the disease. Don’t let the government off the hook by buying into their crusade against greed. Instead of free markets, let’s punish the truly guilty for once.

[1] https://www.merriam-webster.com/dictionary/greed
[2] It should be noted that this applies to truly free markets. In the U.S. mixed economy, government privilege allows some to accumulate great wealth because of that privilege, rather than any great value they offer the marketplace in return. Of course, the solution to this is to eliminate government privilege, not restrict the market further.
[3] Duhigg, Charles “The Reckoning: Pressured to Take More Risk, Fannie Reached Tipping Point” The New York Times Oct. 4, 2008 https://www.nytimes.com/2008/10/05/business/05fannie.html?pagewanted=1&sq=mudd&st=cse&scp=1

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>The Bursting of the Socialism Bubble

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>In the midst of what “debate” there has been about the eventual bailout of the financial sector, it is clear that even most of those opposed to the bailout do not understand what is happening. The unfortunate aspect of some of the commentary is that there is a faction arguing that without the bailout, the stock market will not crash. Thus, the debate is shifted to “which course of action can best protect stock market values?” They cannot be protected. The government argues that the credit squeeze could result in unemployment, while the other side argues that unemployment will not necessarily result if the bailout is not passed. Another position blames the crisis on too little regulation. All of these positions are wrong. There will be a painful adjustment in the stock market and massive unemployment, whether the government bails out the financials or not. The only question is how long it will last. That is reality when any bubble deflates.

The most unfortunate result of all of this misunderstanding would be for the American people to reverse their position and support the bailout just because there are severe market losses if it does not pass. Their initial instinct was correct, whether for the right reasons or not. The losses that these companies suffered due to massive malinvestment are real, and that must eventually be reflected in the value of their stocks.

Similarly, it will be unfortunate if the American people are convinced that more regulation is needed to prevent this from happening again. More regulation will not prevent a problem that was in part caused by too much regulation.

We have heard about the “tech bubble,” the “housing bubble,” and even the “dollar bubble.” All of these are real. The dollar bubble is about to burst, with global catastrophic consequences, but even that is not the biggest bubble that is out there. The biggest bubble, which has been building literally for the past century, is what I will call “the socialism bubble.”

What is the socialism bubble? Let’s define “bubble” first. The term “bubble” is used in economics to describe a large misallocation of resources (malinvestment). Anyone with even a passing familiarity with economics knows the basics: the central bank artificially infuses money and credit into the economy, that money flows toward projects that appear to be profitable under the artificially created conditions, but aren’t, and those projects ultimately fail, causing the bursting of the bubble. The worst part of the bursting of a bubble is that the greatest misallocation of resources has been human resources, and those people now have to find new jobs. They have to be reemployed elsewhere, in more profitable ventures, just like the capital goods that were misallocated to the projects. That is why unemployment accompanies recessions.

Like any other bubble, the socialism bubble is also a misallocation of resources. It has just taken longer to form and is much huger in scope. The principles behind it are the same, however. It represents government intervening into the economy to create artificial conditions that misallocate resources. Under these artificial conditions, the entire economy appears to be profitable, but isn’t. When the inevitable bubble bursts, all of the resources, including human resources, that were misallocated, become unemployed. We are about to experience the massive correction following this socialism bubble.

How did it happen? One must look back to before it started to understand it completely. It started at the turn of the last century. The United States of the 19th century had the closest thing to laissez faire capitalism ever achieved in history, arguably followed next by Great Britain. The defining principle of laissez faire capitalism is VOLUNTARY EXCHANGE. With everyone acting in their rational self interest, the minds of all participants were leveraged by the system to consistently produce optimal results.

In the laissez faire marketplace of the 19th century, wages generally declined over time. A pitiable lack of understanding of economics caused social reformers to condemn the free market for this.[1] They ignored the fact that the general price level fell faster than wages, making workers richer in real terms. They attempted to improve on the results that laissez faire capitalism had produced with government policy.

However, there is only one alternative to voluntary exchange: INVOLUNTARY EXCHANGE. Government economic policies FORCE economic agents to make choices that they otherwise would not make. No matter how one tries to euphemize socialism, that is what it is. By attacking voluntary exchange, socialism attacks the mechanism that creates wealth. That is the true root of the problem.

One way in which this manifests itself is in the cost of production. Government cannot come to a company that makes automobiles and force them to pay their employees more, provide them healthcare or pensions, pile one regulation on top of the next in terms of how the company operates its business, and then expect the company’s cost of making that automobile not to rise. As the cost of production rises, the company must find a way to keep the cost of producing their product below the market retail price. They might decide to manufacture SUV’s, which have larger margins, even though a spike in gasoline prices could put them out of business. See General Motors. The truth is that none of the American auto manufacturers are able to produce an automobile that is competitive in the market. Government will come up with a host of villains to blame for this, but look at the balance sheets of the Big Three and you will see why they are not viable. Concessions to labor unions (mandated by government) have made it too expensive for them to operate.

Similar government intervention is behind virtually all of America’s loss of manufacturing infrastructure. It is simply not economically viable to manufacture anything in the United States anymore. This is not a natural result of free markets. As previously noted, wages and other costs of production fell under the laissez faire system. Falling prices are a natural result of economic growth and innovation. Only the artificial conditions created by government intervention – the use of force to coerce economic agents – have made it more expensive to make things in America.

The cost of production is not the only pressure that socialism has put on the American economy. The welfare programs currently consume 11% of GDP. Keynesians would say that this is ok, because the recipients spend that money and increase demand. Hopefully, the coming calamity will discredit this economic school of charlatans once and for all. Wealth is created by production, not consumption. This redistribution destroys voluntary savings and ultimately capital. It also eliminates the other conditions that accompany a period of voluntary savings that facilitate natural expansion of the productive structure.

In any case, increasing socialism has put artificial pressures on the American economy for almost a century, and those pressures have accumulated to make America profoundly less productive. Like the communist countries, we have lived in a dream world in which government could use coercion to change economic reality. We have pretended that a business venture can spend more than it takes in and continue to survive. For a time, the free market aspects of America’s “mixed economy” allowed her to overcome these negative pressures, but that time has passed. Economic reality is about to assert itself in devastating fashion.

For at least two decades now, America has been producing far less than she consumes. All things being equal, this would not have gone on for long. However, all things have not been equal. The United States has a central bank, and the privilege of printing the world’s reserve currency. This is why the socialism bubble has been become so enormous.

Instead of a drop in consumption and a rise in unemployment[2] as its manufacturing sector migrated overseas, America went right on consuming, and those employees found new jobs in the “service economy.” With the Federal Reserve providing an unlimited supply of fiat currency, and with the ability to ultimately export that inflation overseas by importing foreign goods in exchange for U.S. dollars, America has been able to maintain the same standard of living as it enjoyed in its productive days. As long as foreigners accepted U.S. dollars, the dream world could persist. The bubble continued to inflate.

The ominous part of this is that today a large percentage of the American labor force is now misallocated by this bubble. There are tens of millions of American workers that are employed in ventures that will cease to exist once the socialism bubble bursts. We have seen the beginning of this with the failures of large retailers and restaurant chains, but that is only the tip of the iceberg. Worse yet, unlike previous recessions, there are no manufacturing jobs for these displaced workers to redeploy to. The productive structure must be rebuilt, and that doesn’t happen overnight.

Therefore, Americans must realize that a stock market crash[3] and mass unemployment are inevitable, whether government intervenes or not. The only question now is how long those undesirable conditions will last. There is no “solution,” government or otherwise, that will allow us to avoid this correction. If the government does not intervene, the stock markets will crash faster and the layoffs will begin sooner, but the total period of adjustment will be far shorter. If the government intervenes, no matter how they do it (including by allowing the Federal Reserve to massively inflate the currency), the adjustment period will be stretched out, with continued new malinvestment even as liquidation of current malinvestment occurs. That was the story of the Great Depression.

The only course of action that can speed up the recovery is a return to the laissez faire capitalism that made America great in the first place. This would include eliminating unnecessary regulation, abolishing the central bank and restoring sound money, eliminating minimum wages and other artificial price controls, capping and eventually phasing out the entitlement programs, eliminating other massive government spending like military welfare for other countries and unnecessary war, and restoring protections of property rights. In other words, Freedom. Don’t you think it’s time we tried it again?

[1] The lack of understanding of “real wages” was certainly not the only misconception of the social reformers, but it was a major misconception and representative of others.
[2] The European mixed economies have already experienced this adjustment, debased their currencies, regrouped under the European Union and an new currency, and are presently pursuing the same failed ideology to destroy this new economy as well.
[3] It is conceivable that the Federal Reserve could inflate the currency so much that the stock market remains at $11,000. However, if $11,000 only buys 10 loaves of bread at that point, it would still represent the same devaluation as a crash.

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>Be Careful What You Fight For

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>There is one positive consequence of the economic collapse that is occurring, and the futile attempt by the government to stop it with money stolen from its constituents: the American public has woken up. Despite the best efforts of the major media outlets to spin this the way the government would like, it is apparent that mainstream America is mighty angry that they are being fleeced to prop up the financial system. I hope that anger does not fade with the passage of time – at least not until after November 4th. While wholesale changes are unlikely, it would be nice to see a few incumbents packing after this election and replaced by non-Republicrats. It would be an encouraging sign of things to come.

However, as good as it is to finally see some outrage over the destruction of our Republic, there is still a long way to go. Listening closely to the cries of anger, it is apparent that the majority of Americans still haven’t found their way to actually demanding their freedom. While they are angry, it seems that government has successfully channeled their anger in the wrong direction. Generally, Americans are mad at Wall Street, and are blaming this crisis on “greed.” To the extent that they fault government, they are blaming the crisis on “not enough regulation on Wall Street” and even (ugh) “too much laissez faire capitalism.” This of course plays right into the government’s hands, because the answer to “too much laissez faire capitalism” is more government intervention into the marketplace – which was the REAL cause of this problem in the first place.

If anything, the number one clue that it was not free enterprise that caused this debacle is that the government says it was. By now, every American should know to listen carefully to everything that the Bush Administration says and assume that exactly the opposite is true. However, decades of conditioning to mistrust the free market is paying off for the government, at least for the time being. They have turned this into a class war, instead of an ideological one. They have Americans indiscriminately resenting the wealthy, whether they earned their money legitimately or not. They have Americans condemning corporations, whether they achieved their place in the market legitimately or not. While Americans are mad at their government, they have been convinced, for the moment, that government’s failure was not protecting the average American from the evils of capitalism.

Of course, the truth is that this crisis was a failure of socialism, not capitalism. It was the socialist idea that every American was entitled to a house, and that taxpayers must pay for them, that led to the creation of Fannie Mae and Freddie Mac. Those companies guaranteed mortgages to people that would not have received them in a free market. Only the ability of the government to forcibly collect taxes to back those mortgages allowed the lenders to offer them. If there was any doubt that the government was backing Fannie and Freddie with taxpayer money, that doubt was removed when the government took over the companies when their inevitable failure occurred.

Even with the GSE’s in place, it took another socialist institution, the Federal Reserve, to supply the imaginary money needed to lend to all of those “sub-prime” borrowers. Without the imaginary “liquidity” provided by the Fed, the loans could never have been made and the home prices could never have been bid up so far. The Fed merely blew up another bubble, as it has been doing since the day it opened its doors in 1913.

What these interventions into the marketplace do is create artificial demand. Everyone knows that an increase in demand, while supply remains equal (or when the increase in demand outpaces an increase in supply), results in an increase in price levels. However, demand is not merely the desire to purchase a product, but also the ability to do so. If demand were merely the desire to have something, there would be unlimited demand for all products and services, taking most of the challenge out of running a successful business! The Fed and Fannie Mae certainly didn’t increase the number of people who desired to have a house, but it dramatically increased their purchasing power. In fact, the combination of easy money and credit by the Fed and the incentive for lax lending standards represented a massive increase in demand over the entire housing market, with the predictable dramatic increase in home prices. None of this represents free market forces at work. It is textbook socialist central planning and wealth redistribution.

That brings us to the government “solution,” and what Americans should really be mad about. Our government is now going to forcibly extort trillions of dollars from us in a misguided attempt to maintain the artificial conditions it created in the market. It won’t work. They have tried it many times, and it has never worked. The artificial demand drove prices far above their natural level, and natural market forces are now pushing them back down. Borrowers were lent money that they were never going to be able to pay back. What is worse, a large percentage took the artificial equity caused by the rise in price of their homes in home equity loans and spent it. That money is gone, and the borrowers can’t pay it back. Government taking possession of the mortgages isn’t going to change that. Those borrowers are still going to default, and the home prices are eventually going to go where they naturally must go. Economic forces are like forces of nature. In the end they cannot be stopped.

This intervention is practically identical to the interventions attempted during the Roosevelt administration in the 1930’s, which turned a severe 2-year recession into a crushing, 10-year depression. This bailout will have devastatingly similar results. It doesn’t matter whether a CEO gets away with a $10 million dollar bonus or not. What matters is tens of millions of Americans unemployed for a very, very long time. THAT will be the result of government’s attempts to maintain the artificial conditions in the economy that GOVERNMENT created in the first place.

Since the Austrian economists predicted all of this, while the Keynesians did not, it might pay to listen to what the Austrians suggest as a solution to these government-created crises. While their first advice was always not to create the problems in the first place, they certainly were clear about what to do when the inevitable bubble bursts occurred. Not surprisingly, they advised us to do EXACTLY THE OPPOSITE of what the government proposes. The cure for the recession, according to the Austrians, was to EASE regulation on business, especially in the labor market, and allow the quickest, smoothest reallocation of resources (including human resources) that was possible. As government intervention had created the problem, more government intervention was not going to solve it. In fact, any intervention could only make it worse, no matter what form it took. That is because the wealth creating mechanism of capitalism depends upon the participants making their decisions voluntarily, and government intervention represents forcing people to make different choices. This is really what most Americans are demanding from their government right now – for government to force market participants to choose differently than they otherwise would. Be careful what you fight for, Mr. and Mrs. America, you will probably get even more than you asked for.

I do have hope, however. Sooner or later, Americans will figure this out. At least they’re screaming about something now, which is a lot better than the docile slumber they’ve exhibited over the past several decades as we’ve marched toward oblivion. The government would much rather have them keep on sleeping than to have to divert their anger towards scapegoats and imaginary boogeymen. They will succeed in doing just that this time, but their system is nearing its end. The inevitable economic debacle will occur, and hopefully that will be the final straw. Americans have put their faith in government control and central planning of their lives for almost a century, and it has consistently let them down. Perhaps this last calamity will finally make them see the socialist lie for what it is. Then, they will finally stop walking down the road to serfdom.

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The Populist Myth of the 19th Century

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1024px-Mill_Children_in_Macon_2Spending too much time talking with people that share your views can skew your perception of public opinion. Once you are close to any subject, there are certain conclusions that you accept as self evident because their validity has been proven over and over again. As time goes by, and you have discussions with people that are equally convinced of the validity of those conclusions, it is easy to begin assuming that everyone recognizes them. It is only by talking with people outside your group that you realize that, however valid your beliefs may be, the vast majority of people are either ignorant of them or remain unconvinced. This is undeniably true for me regarding the 19th century.

Despite irrefutable evidence to the contrary, there is a popular view of that period that I call The Populist Myth of the 19th Century. Before dismissing its relevance, consider the fact that this myth has been and remains the driving force behind most public policy from the turn of the 20th century to the present day. Belief in this myth has been behind the gravest errors made by government, not only in domestic policy, but in foreign policy as well. The great wars of the 20th century may well have been avoided and the defeat of poverty might be within our grasp had this Myth not gained acceptance with the great majority of people. These are extraordinary claims, to be sure. However, not only are they provable with diligent research, they can be proven theoretically as well. However, before getting to the proof, let us first define our terms. What is the Populist Myth of the 19th Century? It goes something like this.

After the United States won its independence from Great Britain, it established a system of government that placed priority of individual rights over all others. As a natural result of its system of laws, an economic system of unprecedented free trade, or laissez faire capitalism, naturally emerged. As a result, the Industrial Revolution came to America and flourished even more so than it had in Great Britain. Unencumbered by government control, America became a great wealth-producing engine and hotbed of innovation that resulted in a reshaping of the way human beings lived their lives and made great fortunes for captains of industry that lead the way in this period of explosive progress.

However, the price of this unencumbered freedom was oppression of the working and poorer classes by these same captains of industry. Unrestricted by government regulation, large corporations were free to drive down the price of labor, cut their costs by skimping on safety and other protections in the work environment, and increase their vast fortunes at the expense of misery for the working class, which was reduced to virtual slavery. Eventually, even the children of working class families were sent into the factories to help families on the brink of starvation try to earn enough to survive.

By the turn of the 20th century, it was apparent that reform was needed to save the working class from the victimization inherent in laissez faire capitalism. The social reform movement began, establishing social programs for those left behind, imposing tighter regulation on business, giving a fair chance to workers to unionize, and preventing the natural inclination towards monopoly that was also apparently inherent in capitalism. The fight for the common man had begun, with its champions Woodrow Wilson, Teddy Roosevelt, Franklin Roosevelt, and other bright lights of the 20th century. That fight goes on to this day, championed by the “liberal” or “progressive” parties in politics, with the goal of someday achieving the economic equality that a free society desires.

This is a compelling story. It appeals to the natural instinct in humans to pull for the underdog and fight against injustice. The basic tenets of this myth have inspired great works of literature and iconic films over the past century. It remains the core belief of most celebrities in America, an assumption of the media when looking for compelling news or attempting to appear “on your side” to the average reader/viewer, and most importantly, a fundamental assumption of government in making the laws which determine what we can and cannot do. There is only one problem. None of it is true.

Certainly, the general “solutions” alluded to occurred, but the problems did not exist. This may seem ridiculous to most 21st century Americans. EVERYBODY knows that working conditions were poor in the 19th century, workers were economically oppressed, that unrestricted capitalism naturally results in monopolies, and that, however distasteful it might seem, some government control of the economy is necessary or most of society’s wealth ends up in the hands of the wealthy few at the expense of the starving masses. Let us take a look at the fallacies of the Myth one at a time.

First, the quality of life of the working class did not deteriorate as the industrial revolution progressed, it rose dramatically. Pictures of what we would consider today squalid living conditions and relative poverty are extremely misleading when viewed in a vacuum. When one considers the quality of life for the working classes – the peasants of the old world – for all of history before the Industrial Revolution, it is apparent that the quality of life during the 19th century was much better. More importantly, IT WAS CONSTANTLY IMPROVING. This was the natural result of innovations like mass production. A simple understanding of supply and demand dictates that when the supply of goods and services is increased, their prices go down. The supply of goods and services, especially manufactured goods, exploded in the 19th century. Products that had previously been only available to the rich were now available to everyone, and their prices had dropped low enough that even those on an average income could afford them. For the first time in history, the primary market for the output of society’s production was the common people themselves, rather than the rich.

Detractors of capitalism often point to periods of decline in average wages as “proof” of the inherent oppression of the worker in laissez faire capitalism. This argument demonstrates either an attempt at deliberate distortion or a pitiable lack of understanding of basic economics. While wages sometimes did go down, prices declined at a much faster rate, resulting in a dramatic rise in “real wages” for the average working class American. Money is only the medium of exchange, and its nominal value is irrelevant without considering its corresponding purchasing power. If one had the power to cut all wages by 10%, but also to cut all prices by 50%, one would have the power of making everyone much, much richer. That is exactly what laissez faire capitalism did during the 19th century. It not only made the captains of industry richer, it made the working class richer. This trend was still continuing when the social reform movement started. Had it not been interrupted, one can only imagine how much better off the working class might be today.

There is also the myth that laissez faire capitalism naturally results in monopolies for large corporations, which then use their advantage in the market to raise prices for consumers and drive down wages, resulting in a general impoverishment of the working class. Again, the most basic understanding of economics (or even simple logic) refutes this claim easily. First, one must consider that there are two kinds of monopolies. One certainly can result from laissez faire capitalism. The other kind is a government created monopoly. The first kind of monopoly actually benefits society, while the second harms it.

Monopolies occur naturally in a laissez faire system only one way: when one company is able to deliver better products at lower prices than any of its competitors. Contrary to the Myth, this type of monopolist cannot then use its advantage to drive up prices and drive down wages. It must continue to keep its quality higher and prices below that of its competitors, or its monopoly status will cease to exist. Similarly, it is also competing with other firms for quality labor. If it offers lower pay or poorer working conditions than its competitors, its labor force will naturally migrate to the higher pay and better conditions of the competitors. While it might be argued that neither of these can happen once the monopolist’s competition has been eliminated, competition is NEVER eliminated. If there are no active firms competing at the moment, the possibility of investors entering the market is always present, and new firms enter the market the minute that a monopolist shows signs of vulnerability in its domination of a particular industry. Thus, the possibility of competition hangs over the head of the natural monopolist like an economic sword of Damocles.

A government-imposed monopoly, on the other hand, suffers from none of these pressures. Since no other firms are ALLOWED to compete, the monopolist is free to set prices wherever it sees fit. For any workers that desire to work in that particular industry, they must accept the wages offered by the monopolist or not work in that industry at all. It is within the government-imposed monopoly that all of the evils associated with monopolies exist.

Government-imposed monopolies can occur in two ways. One is where the government simply passes a law saying that a particular firm will be the sole provider of a particular good or service. This was common in the 20th century for public utilities. The flawed logic that inspired these policies was rooted in the Myth. It was thought that for basic necessities, which everyone was entitled to, businesses should not be allowed to profit from providing them. Therefore, government would allow one company to sell those services to the public, with strict control over their prices. The obvious failure of this logic resulted in the deregulation movement later in the 20th century. Detractors of this will point to power shortages and blackouts such as those experienced in California earlier in this decade. However, analysis of those crises consistently reveals that they were caused by those government controls left in place after deregulation, rather than the deregulation itself. For example, in California, the mass blackouts of 2001 were the result of price ceilings left in place in the supply chain. A free market makes no compromises.

The other, more common type of government monopoly results from excessive regulation. This is the unforeseen result of copious regulations imposed on industry in trying to solve the imaginary problems of the Myth. When it becomes so expensive to comply with regulation that only the largest firms can operate in a given industry, you have a trend toward government-created monopoly. More often than an outright monopoly by one firm, a few large firms emerge and do compete with each other, but they are insulated from new competition by the cost-prohibitive aspect of complying with regulations. While competition amongst themselves brings some of the forces of capitalism to bear, a status quo emerges in how the industry does business and what the limits on price and wages are. The economic sword of Damocles does not hang over the heads of these protected firms, other than to the extent that they compete with each other. Only a new competitor can shake the industry up, and government has insured that new competition is unlikely.

John D. Rockefeller’s Standard Oil was an example of a natural monopoly. It resulted in oil being delivered to the market at higher quality and lower prices than any other company could compete with. Standard Oil’s monopoly was maintained by CONTINUING to deliver that high quality and those low prices. Rockefeller was later a major player in creating the Federal Reserve and other government interventions into the economy, which are harmful to the market. However, he attained his vast wealth and eventual monopoly in oil by benefitting customers, not harming them.

In contrast, the government-created monopolies in the public utilities sector resulted in poorer service and higher prices for consumers. This is the reason that deregulation was eventually pursued. Immediately upon introducing competition and a FREER MARKET, supply and quality rose, while prices fell dramatically. Only in cases where government controls were left in place did adverse results occur, as previously noted.

One more aspect of the Myth that immediately comes to mind is the specter of child labor. The Myth says that child labor was a natural result of the Industrial Revolution, and that only government intervention ended it. Again, a compelling story, but completely untrue. As Andrew Bernstein insightfully points out in his book, The Capitalist Manifesto, the Industrial Revolution didn’t create the practice of child labor, IT ENDED IT. Child labor had been a fact of life for the working class throughout history. Indeed, one of the reasons (and there were many) for the migration of people away from the country and into the factory jobs in the city was the fact that the jobs their children would do in the factories were far easier than the back-breaking work they did on the farm. After less than a century of industrialization, real wages rose to the point that most families did not have to send their children to work at all. Thus, government did not end the practice of child labor, laissez faire capitalism did. This is a verifiable fact of history.[1]

This is only a brief and incomplete critique of the Myth. It has many other components, each of which can be shown to be equally false. The Myth is based upon a core misunderstanding of capitalism. Today, capitalism is wrongly characterized as a system that gives an advantage to the rich, or to employers. It is no such thing. Capitalism is the system of freedom, where every transaction between buyer and seller is undertaken by mutual, voluntary consent. In this system, all participants make the best decision that they can based upon their rational self interest. Sellers attempt to sell at the highest price that their goods or services will fetch on the market, while buyers attempt to buy at the lowest prices that they can. Buyers seek the highest quality for their dollar, while sellers seek to provide higher quality for the same money in order to win business away from their competitors. The sum total of all of these voluntary transactions results in the economy becoming a wealth-generating engine. The secret is the ability of all participants to choose freely. By acting in their rational self interest they benefit both themselves and society as a whole. Without this free choice, the wealth-creating mechanism breaks down.

Many might argue that “buyer and seller” immediately excludes “worker,” but that is a tragic misunderstanding as well. In a capitalist system, labor is a market like everything else. “Workers” are really SELLERS. They are selling their services to employers. They compete with each other for the best jobs, and employers compete with each other for the best employees. When not disrupted by government, all of the benefits that accompany the free market for other goods and services occur in the labor market as well. Detractors of capitalism attempt to portray workers as servants that must be protected from their oppressive masters. They are no such thing. They are sellers that require no more protection from their customers than a car dealer requires protection from its customer shopping for the best car at the lowest price. By offering higher quality work, workers can demand higher prices for their services. They are free to accept an offer of employment or turn it down, or to leave their present employment for a better offer. In a truly free market, workers are empowered as the owners of the original means of production that they are.

There is even a benefit to the worker of this free buying and selling relationship when it results in lower wages. Remember that in a laissez faire capitalist system, the workers are also the chief market of the mass supply of goods that results. Thus, if the market lowers the price of labor, the corresponding price of consumer goods also falls. Therefore, even if the worker is earning less money, his purchasing power increases. His real wages go up. He becomes wealthier. Just as wages never rise nearly as rapidly as the general price level of consumer goods in an inflationary pattern (making workers poorer over time), wages never fall as quickly as the decrease in the general price level that is the result of natural economic growth (making workers wealthier over time). That real wages went up during the 19th century is a verifiable fact, and is not in dispute.

At the turn of the 20th century, even the proponents of the social reform movement recognized that capitalism was making the working class wealthier and eliminating poverty. They did not start the reform movement because capitalism was not helping the lower classes, they started it because they did not feel the improvements were occurring fast enough. This fact, too, has faded from memory, but a little research will bear it out. With all of the achievements of the century behind them, and the marvelous innovations that mankind had accomplished, they felt that there was no reason that anyone should ever want for anything again. Within 50 short years, the telephone, the moving picture, the automobile, and most of the rest of what we think of as the modern world had been invented, mostly in America. Surely, they thought, poverty could be eliminated as well. They attempted to use the power of government to ACCELERATE the progress that laissez faire had resulted in.

However, there was a fundamental flaw in their thinking. They failed to understand the mechanism that made all of that wealth creation and innovation possible. The mechanism relies on the choices between buyers and sellers being VOLUNTARY. Once the introduction of force is introduced, the process is disrupted. Detractors of capitalism consistently fail to recognize or are able to ignore the reality of what “social reform” is. It is GOVERNMENT USING THE THREAT OF VIOLENCE TO SEIZE AND REDISTRIBUTE PROPERTY, AND TO FORCE BUYERS AND SELLERS TO MAKE CHOICES THAT THEY OTHERWISE WOULDN’T MAKE. However they try to euphemize it, THIS is the alternative to laissez faire capitalism that they offer. Most non-economists probably do not realize this when they advocate for most government economic policies. They would probably find them morally repugnant if they understood them properly. However, this is the REALITY of even the “mixed economy.”

This use of force is not without consequences, however. By disrupting the voluntary nature of the transactions, capitalism’s wealth-creating mechanism breaks down. The more property is stolen for welfare programs, the less capital is left to expand production. The more government intervention there is, the less wealth is created. Productivity and innovation cannot be forced. That is the reason that free people are more productive than slaves. It is the reason that communism has failed wherever it has been practiced. Russia had a larger population and more natural resources than the United States, but tens of millions of their people died amidst those vast resources because they were practicing an economic system that did not allow the wealth-creating mechanism of capitalism to function. The same can be said of China, Viet Nam, and every other country that practiced communism. As they have moved toward a free market economy, they have become more and more prosperous. As America has moved toward a less free market economy, it has declined.

Today, the United States practices a “mixed economy” because of the persistent belief in the Myth. Refusal to recognize the plain facts of history, that the working class was becoming richer under laissez faire, rather than poorer, is the only reason that laissez faire is not still the economic system of the United States. It is also the reason for the socialist movement throughout the world, which directly led to the World Wars and the ensuing Cold War. Despite the fact that both economic systems have been taken to their logical extremes, and socialism produced mass starvation while capitalism produced mass prosperity, America continues to try to mix socialism with capitalism. After a century of “government reform” of capitalism, the gap between rich and poor is far wider than it was under laissez faire capitalism, the quality of life of the working class is declining, and a much greater concentration of wealth in the hands of the very few is occurring. Everything that the social reformers set out to do has not only failed, but resulted in the exact opposite of what their intention was. It is not a matter that the reform was not done skillfully or completely enough. It is a matter of the “reform” being the use of coercion to force people to make choices against their will. It is morally repugnant, and it does not work.

Politicians are naturally disposed to believe and promote the Myth. It gives them a reason to do a whole lot more than they would be allowed to do otherwise. Promoters of the Myth cite their “heroes” of the 20th century. Only by believing the Myth can you admire the policies of Woodrow Wilson, Teddy Roosevelt, or FDR. These men were great destroyers of prosperity and violators of individual rights, not heroes. They attacked capitalism under the pretense of solving the imaginary problems of the Myth. When crises occur in our “mixed economy,” politicians consistently blame the capitalist aspect of our society rather than the socialist aspect, and suggest more socialism as a solution. “Coincidentally,” this results in more power for the politician.

The Myth is pervading our current presidential election campaigns. McCain claims Teddy Roosevelt as his hero. Obama has invoked FDR. Both agree that more regulation is needed to solve the current financial crisis. Popular acceptance of the Myth allows them to frame the debate where only less freedom can solve our problems. It is up to the American people to choose. The proof that the Myth is false is everywhere, even in public records maintained by the government itself. However, there will never be a large movement to truly solve our problems until Americans learn accurate history and stop believing in the Myth. Once they do, they will see that the great experiment has been completed, and the results are indisputable. Only laissez faire capitalism – the economics of freedom – can restore America’s prosperity. It is the only moral and practical choice.

[1] Bernstein, Andrew The Capitalist Manifesto: The Historic, Economic, and Philosophic Case for Laissez Faire. University Press of America 2005

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

The Hypocrisy of Civil Discourse

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“…nor suffer yourselves to be wheedled out of your liberty by any pretences of politeness, delicacy, or decency. These, as they are often used, are but three different names for hypocrisy, chicanery, and cowardice.”

John Adams (1765)[1]

There is a politeness, a delicacy, a decency – perhaps what might today be called a “political correctness” – that is nothing more than the hypocrisy, chicanery, and cowardice that Adams warned of. It is both mistakenly practiced by the innocent and maliciously utilized by the guilty. It is an evil falsehood masquerading as a noble truth. It is a rotten vice disguised as an exalted virtue. It is one more device of the tyrant used to persuade the people to enslave themselves. Like so many of the mantras repeated ad nauseum by our political machine, it is universally accepted as wisdom when in fact it is the most ludicrous logical fallacy.

It is the erroneous axiom that all opinions should be respected.

Already the reader is experiencing a conditioned repulsion similar to that felt by the religious fanatic when confronted with what he believes to be some great heresy. From the time we are old enough to understand (perhaps before), we are taught that it is the ultimate ignorance, arrogance, or stubbornness not to respect all opinions. Our minds are enriched and our reasoning powers sharpened by considering different perspectives. It is only the fascist or the despot that does not grant to all people that they are “entitled to their opinion.” Often polite adversaries will conclude that they “agree to disagree.” Other costumes that this fraud may don are “civil discourse,” “spirited debate,” and “diverse perspectives.” In the well-mannered company of yuppie pseudo-intellectuals, it is at the very least impolite and may even approach grotesqueness to deny anyone the right to their opinion, no matter what that opinion may be.

Having been raised Cheektowaga, N.Y., I am grateful that I have been provided with no more manners than the bare minimum that I need to survive. Therefore, I will speak the unspeakable and let the reader either confront the truth or retreat in horror. As a warning to the politically correct, what follows is not suitable for the overly accommodating or the timidly polite.

There are some opinions to which you are not entitled.

You are not entitled to the opinion that you may use the threat of violence (government) to prevent me from doing what I please, provided that I harm no one else.

You are not entitled to the opinion that the government may use my tax money and risk my life to prosecute wars of aggression.

You are not entitled to the opinion that you may extort the fruits of my labor in order to provide yourself or someone else with healthcare, retirement benefits, or other stolen property.

You are not entitled to the opinion that you may use the threat of violence to prevent voluntary exchanges of property between free individuals (a.k.a. “economic policy”).

You are not entitled to the opinion that the coercive power of government can be used for anything other than the protection of my life, liberty, and property.

To put the above statements more succinctly, you are not entitled to the opinion that you have the right to make me a slave, whether fully or by some degree. THIS is the underlying assumption supporting all of these opinions.

I suppose that you could answer this entire argument with the sickeningly passive-aggressive refrain, “we will just have to agree to disagree.” I do not agree to disagree. You are either ignorant of our relationship or trying to obfuscate it, so let me make it perfectly clear. If you hold one of the aforementioned opinions, you have openly declared a state of war to exist between us. You have become an aggressor and have given me every right to defend myself by whatever means necessary in order to prevent the crimes which you have stated that you intend to perpetrate against me. You have made a threat of violence which I have no reason to believe that you will not carry out if I do not take immediate action to prevent it.

There are only two reasons why I respond with words at all, instead of action. One, I have a genuine wish to resolve differences peacefully, if they can be resolved in such a manner. I do not wish for nor condone violence, nor do I condone any violent rebellions against our American government. However, these principles do not eliminate my own instinct for self-preservation, nor will they prevent me from defending myself. Two, since the triumph of democracy over republicanism has given tyrannical power to your majority; it has occurred to me that the odds are too great against me in defending my rights against your acts of aggression, however justifiably. Therefore, I may have to capitulate to your tyranny until such time as I have a more reasonable hope of success in defending myself.

However, let there be no mistake about what our relationship is. You are the criminal and I am the victim. You are openly engaged in acts of armed theft, violence, and enslavement against me. I will no longer allow you to hide behind quaint sophistries to characterize this relationship as a mere “difference of opinion.” Do not insult my intelligence by misrepresenting your declaration of war as “civil discourse” or “spirited debate.” Perpetrate your crimes if you feel you must, but at least have the decency to acknowledge them. Be warned of the risks that accompany your actions.

[1] Adams, John A Dissertation on the Canon and Feudal Law 1765

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