Category Archives: Property Rights

The Lost Philosopher

John_Locke_by_Richard_Westmacott For 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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>Housing in the New America II: The Stage is Set

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>“Abolition of private property and the application of all rent to public purpose.”

– Karl Marx and Friedrich Engels (1848)[1]

Just after the abominable housing bill of this past July, I wrote an article about the very real prospect of the government getting into the property management business, due to the nationalization of the mortgage industry that effectively occurred when the government seized Fannie Mae and Freddie Mac. The scenario was admittedly conjectured, but unfortunately it seems to be playing out even worse than I could have imagined (and I can imagine pretty bad from our government). An article in the New York Times put one more piece of the puzzle in place.

Keep in mind that the real devastation of this economic crisis has not really occurred yet. We still don’t have double digit unemployment (at least using the government’s numbers), but that is inevitably what is coming. Right now, we have unemployment that is setting records for one-month growth, but we do not have tens of millions of Americans out of work. That makes today’s news all the more disturbing.

If you have any experience with rental properties, as either a landlord or a renter, you know that when a rental property goes into foreclosure, the tenants are routinely evicted. It is much easier to sell a foreclosure property without tenants, among other reasons because choosing tenants is one of the skills that separate successful landlords from unsuccessful ones. Good landlords also usually want to do some renovation to the property, which is at least inconvenient and to some extent virtually impossible with the property already occupied. The justification for the eviction is, of course, that the property now lawfully belongs to someone else (the bank), who never consented to the rental agreement and has every right to refuse to honor it.

Or do they? According to the Charles Duhigg of the Times, Fannie Mae announced today that it would “sign new leases with renters living in foreclosed properties owned by the company.” Of course “owned by the company” is an ironic choice of words, because “the company” is none other than the U.S. government. While my previous article envisioned Section 8 as the possible vehicle for converting large percentages of the (former) middle class into government tenants, this new policy today goes one step farther. Section 8 uses public funds to subsidize rent payments to private owners of rental properties. This policy represents renters making rent payments directly to the U.S. government, for the “privilege” of living in government-owned[2] homes. While the numbers for homes owned outright by Fannie Mae are small at the moment, it is no less a watershed moment.

Of course the policies of Fannie Mae are not binding upon the so-called “private sector” (is there still one?), at least not yet. As the Duhigg reports,

““We’re not in the business of managing rental properties, and we’re not in the business of being a landlord,” said Thomas Kelly, a spokesman for JPMorgan Chase, which owns about two million loans. “Clearly the renter is caught in the middle in cases like this. When a property is in foreclosure, we follow the law.”[3]

It is somewhat amusing that a representative of J.P. Morgan Chase would speak so reverently about the law, as if it were some bastion of property rights and justice. Having been the beneficiary of the lion’s share of the largesse during the financial sector bailouts, this bank should know better than anyone that the law and justice no longer have much to do with each other. If property rights get in the way of some new government theft, a law is simply passed to eliminate the obstacle. Having eschewed the concept of republican government in exchange for “democracy,” there are now no rights that cannot be violated, as long as a sufficient number of votes can be raised among elected representatives. Indeed, our government does not really recognize “rights,” which transcend government. It grants privileges and erroneously refers to them as rights.

I doubt that private sector banks will retain the privilege of evicting tenants from the properties they acquire in foreclosure for very long, once the new presidential administration and Congress take office. Already, the cries for “fairness” are beginning to be heard. As the Times article reports,

“Some lawmakers and housing advocates say such policies are unjust.
“If your loan is owned by Fannie Mae, you get to stay in your home. If your loan is owned by someone else, you’re on the street,” said Mr. Taylor of the National Community Reinvestment Coalition. “These banks need to realize they’re in the property management business now, whether they like it or not.”[4]

Note the use of 21st century coercion-euphemisms. Any statement beginning with “You need to…” is one that could just as well start with “I ORDER you to…” At least the tyrants in centuries past made such statements with swords drawn and pointed at their victims. Today’s authoritarianism with a smile is actually more horrifying.[5]

With all of the travesties of justice taking place during this blackest of years in our history, one might argue that insisting that banks retain the right to put renters out on the street represents confused priorities. Perhaps so. However, one thing is certain. The line was already blurred regarding the right to own property before this, as the government could seize it from you merely for being unable to pay its property taxes. Now that the banks (and soon anyone buying properties in foreclosure) have no say over who lives in the house that they just bought, that line has become a smudge at best. In reality, there really is no such thing as homeownership. Government merely grants the privilege of stewardship over ITS homes. This latest farce merely makes that fact clearer.

So much for the moral considerations on this issue. I seem to have been far less efficient in confronting them than the government, which breezed right on by them. Who says it can’t get things done quickly?

As far as unintended consequences, this latest bit of idiocy is so ripe with them that it is hard to know where to begin. I am not sure who truly manages these properties, now that they are the property of the government but still occupied. Who does the tenant call when the sink starts leaking? If you think you see a program like Medicare or Medicaid coming, you’re not alone. We could always use another network of overpaid providers rendering sub-par service at a cost of hundreds of billions of dollars to taxpayers. Worse yet, as more and more average Americans wind up in government-owned or subsidized homes, the program to pay handymen to do repairs could grow into an institution, just like the aforementioned medical programs. Among other negative consequences, this will tend to push the prices for these repairs through the roof for everyone, just as government-provided medical care and student loans push up the cost of healthcare and tuition for everyone. Let’s hope the government doesn’t start providing beer – we can’t afford bubble prices for that in times like these!

Of course, the glaring weakness in this latest move has to do with the central issue – selling the foreclosed properties. The whole reason behind lenders taking possession of a property when the borrower defaults is to sell that property and recover some of the losses on the loan. This new policy of Fannie Mae’s, which will almost certainly become a law sometime during the next Congressional term, will only prolong the time that these properties are on the market. Far less buyers will be willing to acquire properties if they are forced to take their chances on a tenant that they haven’t personally vetted, and on a property where their options are limited in terms of what they can do with it after they acquire it. This fits the FDR pattern of intervening into the markets and preventing a needed correction perfectly. The market is trying to liquidate these properties and allow them to be sold at more reasonable prices to more viable customers. The government policy will arrest that process, causing the crisis to take longer resolve itself, if it is allowed to resolve itself at all.[6]

It also goes without saying that the landlords who will buy the homes are more likely to be poorer landlords, as they are by definition landlords who care less about who they rent to. This tends to manifest itself in the appearance and upkeep of the properties, affecting property values throughout the entire neighborhood. Add to that the poor service and quality of work that comes with the government or banks providing the property management and you have the recipe for some scary neighborhoods. Collateral damage certainly isn’t just a military term, once our federal government gets rolling.

So where does this all lead us? I said at the beginning that one of the most disturbing aspects of this story was that an idea like this has been born before the real crisis gets rolling. We have had a market crash and ensuing credit crunch, but everyone seems to be in denial over what inevitably comes next – massive unemployment. Once that starts really manifesting itself (probably as early as next summer), the “state of emergency” mindset will kick in with our government and things could really deteriorate quickly. Right now, loan defaulters are being evicted from the property that they borrowed against and are finding homes in the abundant rental market. However, when the vast majority of them are unemployed, they will need the government to help them, too. It is certainly not hard to imagine a scenario where unemployed loan defaulters are evicted from their homes in foreclosure, only to be “placed” into rental properties that the government owns (but cannot sell), or even into another property that the same bank that just seized their home acquired in foreclosure on somebody else!

For those properties owned by the government, the renters would pay the government directly (eventually it may even be a standard payroll deduction). For those properties owned by a private bank, the Section 8 program will provide the rent subsidies, which the government is now obligated to pay the bank/landlords because they forced them to get into the property management business in the first place. Alternatively, the government may just start buying the houses from the bank, in order to “stablilize” the housing market and because it now has an incentive to grow its new program. The government will certainly have an incentive to put people into the houses that it already owns and cannot sell. This program could realistically feed itself until tens of millions of Americans are in government housing.

On the brighter side, at least this will further solidify the close relationship between our banking institutions and the federal government. We could always use more tight collusion between government and big business. There is no sense in repeating the worst mistakes of the past century without throwing in a little more fascism.

However, the fascist model is more the Republican brand of socialism, at least in this century. The Democrats seems to favor the Marxist variety, as evidenced by their increasingly Marxist rhetoric and their choice of a presidential candidate. Make no mistake, government-provided housing is right in their proverbial wheel house, and you can expect them to jump on the “opportunity” next year’s emergency will afford them to hit this one out of the stadium. The Carter years might look like an economic golden age before this is over. Let’s hope that it is apparent to most Americans in four years that the medicine is killing the patient. Medicare may not be around to cover the catastrophic care needed by 2016.

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[1] Mark, Karl and Engels, Friedrich Manifesto of the Communist Party (The Communist Manifesto) 1848. (This is Plank One of the famous Ten Planks of the Communist Manifesto)
[2] I suppose I should be grateful that the patronizing assertion that “the taxpayers” own Fannie Mae was not made in this particular article. That characterization has been an especially insulting aspect of our conversion to socialism. Ownership can only occur when you CHOOSE to own something, and when you have some control over its disposal. Moreover, it should be evident that even in the unlikely event that our government somehow makes money on this travesty, not one dollar will be coming back to taxpayers, nor should we accept it if it did.
[3] Duhigg, Charles “Fannie Mae Lets Renters Stay Despite Foreclosures” New York Times December 14, 2008
[4] Ibid
[5] Sadly, this expression has become ubiquitous in the private sector as well. Americans brought up under the yoke of coercion know no other way to deal with one another.
[6] Of course, this policy would not by any means be the only factor in houses not selling. Neither will it be the only action government will be taking to block the overall correction and make the depression worse.

>Government’s Old Shell Game

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>Most Americans have seen the hilarious skit on Saturday Night Live, where the CEO’s of the Big Three automakers return to Congress with the “turnaround plan” demanded of them as a condition of receiving (stolen) bailout money. In the skit, the CEO’s drive cars manufactured by their respective companies from Detroit to Washington in order to make amends for flying corporate jets en route to their first appeal for our money. Of course, all three cars break down on the way, making the CEO’s late for their appointment with the (looting) Congressmen. The punch line of the skit is that the only plan that the automakers have come up with is to return to Congress every six weeks to ask for more money. To top it off, the GM CEO promises that by the time that they are ready to accept the December payment – provided that car sales rebound – they would actually need even more money.

It is sometimes said that life imitates art. As funny as the Saturday Night Live skit was, real life proved even funnier. The CEO’s did manage to marshal the resources of their Fortune 500 companies (referencing the 2006 list) and come up with three Detroit-manufactured vehicles that could make it to D.C. However, as in the comedy, the CEO’s show up at Congress three weeks after asking for $25 billion and actually ask for more! Rather than outrage, Americans should really take the opportunity to find some humor in this. As the last vestiges of our Republic are destroyed, one can either laugh or cry. Let’s recognize this ridiculous exercise for what it is – a farce – and have ourselves a good, hearty laugh. We deserve it. Then, let’s stop laughing and turn our attention to the real villains in this immorality play: the United States Congress.

As tempting as it is to focus our attention on the pompous CEO’s of these horribly run companies, let’s not forget why they became so horribly run. It seems to be routinely forgotten that it was Congress that created the labor union problem, with its National Labor Relations Act of 1935 and subsequent violations of property rights. This is why the American auto companies can’t afford to compete. It is also forgotten that Congress created Fannie Mae/Freddie Mac and the Federal Reserve (the three entities entirely responsible for the housing bubble), Medicare and Medicaid (the programs entirely responsible for the both the bubble-prices of healthcare and the lion’s share of our $50 trillion in unfunded entitlement liabilities), the Department of Education (the agency entirely responsible for the next bubble – tuition prices), and every other economic problem that the United States faces. It is no less than tragic that Americans still have not figured out that, left to themselves, with a government limited to enforcing contracts and protecting them against violence, they would trade freely with each other indefinitely to their mutual benefit. Instead, Americans still look to this body of criminals to SOLVE problems that said criminals created. How are they continually fooled?

There are a number of answers to that question, but there is one strategy employed by our ruling class that is particularly frustrating. Students of philosophy may call it the Hegelian Dialectic, while political strategists may call it “framing the debate.” For us plain folks, you might just call it the “heads I win tails you lose” strategy. Every time that Congress wishes to commit some new crime, they present it with a ready-made debate, eagerly facilitated by our so-called journalists. In each case, the issue is presented as if there are only two alternatives, both of which advance government’s purpose to our detriment. Any alternatives beneficial to the people are excluded entirely. It’s the oldest manipulation trick in the book, not much more sophisticated than the old shell game where the pea actually isn’t under any of the shells. Unfortunately, we fall for it hook, line, and sinker, every single time.

This latest farce with the auto companies provides a good example, although there are hundreds (maybe thousands) more. When the idea of stealing our money to give to the failing automakers first came up, there was immediately “fierce debate” in the media about whether the automakers “deserved” the money. Some argued that it was the companies’ own fault that they were in the shape that they were in. Others argued that even if given the money, the automakers would still eventually fail. Congress pompously demanded a turnaround plan from the automakers as a condition of their receiving the money. The media provided (and is still providing) the façade of spirited debate about all of these straw man issues. Every angle to come at this problem is argued, except one: Does Congress have the RIGHT to take our money and give it to somebody else?

Once the deafening silence on this issue is acknowledged, the underlying assumption behind all of the rest of the arguments becomes clear. We no longer have any individual rights. In debating whether or not the bailout money would keep the companies from failing, the obvious assumption is that if the bailout would save the companies, then Congress has the right to forcibly steal our money to save them. In debating whether or not the companies themselves had caused their own demise, you must assume that if they did not, then Congress has the right to steal our money to help them. When demanding that the automakers come up with a turnaround plan to ensure that they do not need taxpayer money again in the future, Congress assumes that they have the right to steal our money as long as the automakers present a reasonable plan.

Not one journalist, not one talk show host, not one panelist – no one anywhere – no matter how liberal, conservative, or even libertarian they claim to be, has made the argument that Congress DOES NOT HAVE THE RIGHT to forcibly take money from one person and give it to another. This argument has been excluded from all debate.

There is a very good reason for this. It is that there is no reasonable argument that can be made on these grounds justifying this theft of our property. The Declaration of Independence tells us that governments are instituted to secure our rights. The Declaration also says that those rights are unalienable, meaning that no government – not even a democratically elected government – can take them away. No majority can vote them away. Foremost among these rights is our unalienable right to the fruits of our labor – our property. THIS was the right that the American Revolution was fought over. Read your history. King George wasn’t denying the colonists free speech, or freedom of the press. The colonists didn’t tar and feather censors. They tarred and feathered TAX COLLECTORS. As I’ve said before, it is your property that tyrants covet, not your right to free speech or freedom of religion. This hasn’t changed in two hundred years, nor will it ever change. Government’s job is to protect our property from theft by other people. There is no circumstance that justifies them committing this crime rather than defending us against it.

Therefore, by stealing our money – for any reason – Congress is contradicting the sole reason for its existence. It doesn’t matter if Congress thinks its actions will save jobs (they won’t), if their actions will save the economy (they won’t), or even if they believe the majority of Americans support their bailout. Even if every American citizen alive save ONE was in favor of giving the auto companies this money, Congress WOULD NOT HAVE A RIGHT to give it. To do so is incompatible with liberty.

Seen in this light, it is obvious why it is imperative that the subject of rights does not come up in any discussion of government bailouts. At all costs, Americans must be distracted away from their rights and lured into arguing about something else. Thus, we argue about CEO bonuses, private jets, energy efficient vehicles (and why Detroit doesn’t make them), and a long list of other unimportant details, while ignoring the one and only issue that matters: that this money is the property of each individual American and that government has no right, under any circumstances, to take it from us. Period.

The automaker bailouts are not unique in this regard. This same parlor trick was played on us with the bailouts of the financial companies. Would the executives keep their golden parachutes? If not, then Congress had the right to steal our money. Would the financial system collapse if Congress did not act? If so, then Congress had the right to steal our money. Would 401K’s and other retirement accounts be decimated without the bailout? If so, then Congress had the right to steal our money (did you notice that they were decimated anyway?).

Over many decades, government has employed this simple subterfuge to bait us into abandoning our impregnable position – our rights – and dupe us into arguing the practical merits (or lack thereof) of their crimes. By taking the bait, we disguise the crimes of our government as ineptitude, and relegate ourselves to complaining about poor results rather than recognizing these usurpations for the crimes that they are.

When the banking bailout was proposed, we objected. For one, brief, shining moment, we were Americans again. We told our representatives that they were NOT to take this money. For one glorious day, our government blinked. Then, they told us that some unimaginable doom awaited us if we did not surrender our property to them. We believed them. They told us that our retirement accounts would be devastated if we did not allow them to violate our rights, so we let them take our money. Our retirement accounts were devastated anyway, and we deserved it. By surrendering our own rights, we violated those of our neighbors. The money we let them take was not theirs OR ours to give.

We have another chance. We can call them again and order them not to give this money to the automakers. Yes, I said ORDER them. Rights are not something that you request of your government. They are something that you DEMAND be respected. Our government is about to once again violate our unalienable right to the fruits of our labor. We must order them not to do so. Do not let them derail you with spurious arguments about what might happen if they don’t steal your money. Stick to your guns and keep bringing the argument back to the only issue that matters: this money belongs to you and they don’t have the right to take it. Make no threats of violence or harassment, but accept no compromise or offer to “agree to disagree” either. Hold their feet to the fire and remind them that this government is YOUR servant. You will be surprised how much power you actually wield.

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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>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

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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>False Prophets of Freedom

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Tom Mullen

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

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