Not-a-Lemming : socialism

Mr. Obama, Don't Build That Wall!

FutbolGuru — Tue, 10 Nov 2009 14:44:00 GMT

This week we are celebrating the 20th Anniversary of one of the 20th Century's most shining moments - the Fall of the Berlin Wall. A barrier that represented far more than an edifice of concrete and steel. The Berlin Wall represented a rift across Europe and a major ideological divide between East and West. And as long as that wall remained, so loomed the specter of war. And when it fell, though it signaled the beginning of much work, it also spelled a major victory for the democracies of the West.

The Berlin Wall separated not just familes in a city but an entire nation. And as I mentioned in the preceeding paragraph, it also represented, in a much broader sense, an ideological gulf. A gulf in how cultures had decided to treat the human condition. The Soviets on the east side of that wall were led by the Russians and the philosophy of Marx which claimed it could elevate the common man to his rightful place in society while punishing the greed of the wealthy. In this philosophy the State was represented by the Communist Party which viewed human rights as secondary to the needs and aspirations of the State. In the Soviet Union humans were granted rights at the whim of the State.

Opposing this philosophy, The West, spearheaded by the United States, was armed with a much different view of human rights that was backed up by a unique Constitution. In America's Constitution it is the State that derives its power from the People and there is no sanctioned Party. The west, for the first time in history, viewed human rights as the center of our world view, codified in the precepts of freedom and liberty, and indeed superceding the wishes of the State. The State, in fact, was granted power from the people. These two governments had evolved along much different paths and by 1989 had arrived at vastly different places.

The Soviets, in their attempt to place the entire service and manufacturing sectors under the authority of their government in the hopes of being 'fair', had reached an unsustainable level of corruption and inefficiency. While their government promised retirement and health care to every citizen, both were services in name only. The fastest way to die in the Soviet Union was to check yourself into a state hospital - the only legitimate hospitals in the country. And pensioners had become paupers, living out their 'golden' years in crumbling tenements, entirely reliant on increasingly slim government subsidies. The only people with access to useful services were Communist Party members who used technically illegal private hospitals and doctors. And with their hands in the government coffer Party officials skimmed enough funds to fuel private Swiss accounts that ensured their golden years would indeed be golden.

In contrast, across the sea In America, hard work was being rewarded with stability and security. Wise investment resulted, over time, in net return. Those with the energy and tenacity to pursue the American dream nearly always found it. Sure, there was no free lunch, but Americans knew that a free lunch wasn't worth eating. There was, and remains, a poor class with little desire to work. And as a reward for their laziness they received little. Those putting in the time and energy were not punished for their achievements but rose to the middle and upper classes. Perks for fortitude were comfortable retirement, quality health care, and security. It was understood by many and for the most part, backed up by laws, that if you didn't work, you were going to pay the price. The result was a vibrant growing nation whose philosophy spread to the far corners of the globe and elevated those nations it touched with booming economies and strong middle classes.

And those behind the wall could only look across and dream. Little did they know that their dreams would soon become reality, and with the fall of the Wall in 1989 their own economies exploded. Nations like Poland, Germany (East), Hungary, The Czech Republic, and others have experienced unprecedented growth and affluence in the last 20 years. Sure, their people don't have the promise of free retirement and health care, but at least they now have the opportunity to pursue these goals since the promise was never anything more than a cruel lie. The fall of that Wall, more than any other event in history, proves the wisdom of the Founding Fathers and their vision of limited government.

So why, 20 years later, is the United States, brick by brick, rebuilding that Wall? The ideologies of the East proved the greatest social failure of all time. Never had so many people been so oppressed and deprived for so long, relative to their neighbors, throughout all of recorded history! And the very country that paved the way for the destruction of that heinous barrier is now adopting the ideologies that smothered those trapped behind it. If anything proves that health care, retirement, manufacturing, banking, and economic planning have no business in government, the Berlin Wall is it. Yet the United States, after spending trillions of dollars to first halt the expansion of that Wall, and then ultimately see its destruction, is step by irrevocable step, taking over health care, retirement, manufacturing, banking, and economic planning! We are building that Wall. And the two major political parties, neither of which is endorsed in our Constitution, are making it happen. The Democrats (aided by their willing accomplices in the media) through direct action and the Republicans (aided by their willing accomplices in the upper class) through direct inaction. And once that Wall is in place, as the one in Berlin showed us, it is incredibly difficult to dismantle and often comes at great pain and only after generations of oppression.

Will we as Americans be the next generation of oppressors? Will we make the Soviet mistake even while those crushed by that terror, and those who corrected it are still alive? Many of whom are still in power? Will we doom ten generations of Americans to misery and corruption? Or is the mass suicide of the lemmings unavoidable? Lemmings, lacking a written word, a spoken language, and a culture, can be forgiven for their gullibility. Even if a lemming manages to survive being herded over a cliff by an overeager film maker, it can't warn its kin of the danger the next time around. But humans. Humans have no excuse. And should we decide to codify this path in law, not even our children - much less history - will remember us kindly. "You had a golden age and you threw it away." That's not me. Is it you?

Futbol Guru - www.not-a-lemming.com

"Any man who will trade liberty for security deserves neither." - Benjamin Franklin

Obama and California Health Care

FutbolGuru — Fri, 16 Oct 2009 13:18:00 GMT

In his article in The Observer on October 4th, Paul Harris asks the question, "Will California Become America's First Failed State?" Governor Schwarzenegger's specious California Vacation commercials notwithstanding, this is a question that needs asking. Indeed, in a scene reminescent of the post-Soviet collapse in Russia, the California state government was paying its employees in IOUs this summer and unemployment is over 12% - the highest in 70 years. (Do grocery stores take IOUs?) Regardless the situation is dire and one wonders how much Federal Stimulus money will go to prop up that teetering socialist state?

California, among its many socialist programs, has a health care program called Healthy Families that is intended to provide medical care for millions of the state's poorest residents. Over the years people have become dependent on this program. And why should they not? People tend to form dependencies on free services very quickly. The danger is when these free services fail. At present Healthy Families is failing due to the drop in tax revenue resulting from the recession. A recent scene at the Inglewood Forum near downtown Los Angeles, recounted in Harris' article, sounds more like a UN aid mission to Somalia than something happening in an American city. A travelling medical and dental clinic had set up shop outside the forum that promised free services to the first 1,000 people. The line stared forming at 1:00 AM and before the clinic had opened there were far more people in line than could be treated. Some had travelled hours to attend only to be turned away. Those who had become dependent on the state were being treated by volunteer workers. Americans used to travel to foreign countries to do this. Now we're doing it here.

This is the danger of socialist programs: It can not be assumed that tax revenues are going to be constant or that the economy is always going to grow. At some point the economy is going to contract and where does that leave the socialist programs? Introduction of a socialist medical system, even if it is a competing system and doesn't take over the private system, will spell disaster if not for everyone, then at least for those who grow dependent on it.

Consider the recent economic woes that have swept the nation - indeed, the world. To 'save' the global monetary system U.S. tax payers are forking over $750,000,000,000. Actually I should say, will be forking over $750,000,000,000 because the money is borrowed. And since jobs have dried up, the business sector has shrunk, and investment is down, the tax rolls are down, too. Way down. This is the problem in California and is why they can't pay for their socialist medical care program and people are resorting to volunteer run clinics. If we institute a socialist health care system at a national scale the same thing will eventually happen on a national scale. And when it does, not if - when it does, the non-existent private medical care industry won't be there to fill in with volunteer workers. Not to mention that the economy is down right now and talk of a HUGE new program is irresponsible at best and simply ludicrous at worst. It is tantamount to signing a contract for an expensive new gym membership when you just received word you're being laid off.

Before we adopt a socialist health care system, even if it isn't single payer, we had better look at California and ask what we're going to do the next time the economy shrinks. Except the next time it won't be just the monetary system or the mortgage industry that fails, you can pile health care on top of that. (Note: the health care system WAS NOT affected by this latest recession.) And it won't be tens of thousands as in California. It will be tens of millions. That's a lot of people angry at broken promises that should have never been made. It is simply amazing that Diane Feinstein and Barbara Boxer, both senators from California, are both such strong proponents for a national system when they are from a state where the system is failing. Are we simply going to borrow more to pay for it like California will have to do?

Will we borrow over $1,000,000,000,000 next time? How many zeroes are too many? How much of our progeny's future do we want to bargain away to feed the poor's insatiable, self-indulgent appetite for warmth and a full belly? This isn't a conservative or liberal question. It's a question asked by anyone who understands the danger of having more cash going out than you have coming in. Asked by anyone in an underpowered airplane or an overloaded ship. Asked by anyone who can't find enough food to replace the day's calories. It is a question ignored only by lemmings who will run any direction they are herded until they hurtle over a cliff and into the sea. Watch the film White Wilderness. Once those lemmings go over the cliff it's too late. See them try to scurry back up the slope? They can't and fall to their death. The narrator sounds really nice but he's the very guy driving them over the edge. And he got an Academy Award for it! I'm not a lemming. You're not a lemming. Anyone who doesn't want to go out and get a job like you and me doesn't deserve health care, much less FREE health care. Or free internet. Or a free cell phone. What kind of a nut is coming up with these ideas?

Futbol Guru

The Economy of Scale: Why European-style Health Care CAN'T Work in America

FutbolGuru — Wed, 19 Aug 2009 13:24:00 GMT

Dinosaurs were big. They were the largest land creatures to ever walk the Earth. The largest were nearly a hundred feet long. But as large as they were there is a good reason they didn't get any bigger. In fact, there is an absolute limit to the size an Earth-bound creature can grow without collapsing under its own weight.

Complex organisms like humans, bears, and dinosaurs are muscles hung on a skeleton. The skeleton supports the structure and the muscles make it move. As you'd expect, as the animal becomes larger the skeleton and muscles must become larger as well. While creatures can become large and strong, much larger than humans, the proportions at which they scale are not linear.

For example, if an animal evolves into a similar creature that is twice as tall, you might think that the bones would have to be twice as large. In fact, this doesn't hold. The strength of a bone is related to the cross-sectional area of the bone. However, weight of the bone is related to volume, and volume increases much faster than cross-sectional area. A bone twice as large will weigh four times as much. This means the bones get heavier faster than they get larger and stronger. Eventually, the bone will simply break. Bridges, skyscrapers, and other structures have similar limitations.

Economics is much like this. England has a population 51 million. A healthcare system large enough to service 51 million people won't necessarily scale to a country like the United States which has a population of 330 million; six times larger. This is true because the system won't necessarily have to be just six times larger, it may well have to be 36 times larger. Consider this example as you recall the previous example of the bone.

I build cabinets. I don't do this for a living but it is something I enjoy and we occasionally need cabinets at my house. And the scientist inside me likes holding tolerances to 1/64 of an inch. Regardless, I have a 12' x 20' shop in my backyard that is large enough to build one cabinet at a time. I can store the wood and the tools in the shop. Move the partially completed structure around in the shop at various stages of construction. Then, when I don't building it I can clean the shop thoroughly and move on to the finishing phase - which must be as dust free as possible. While I also use my shop to fix my trials motorcycles, clean guns, and do other odd jobs, I can pretty much only do one thing at a time in there.

Suppose I wanted to start a business building cabinets, something I've thought about from time to time. What would it take? At a minimum I'd have to build another building for the finishing because I can't finish and build at the same time. And finishing takes time as the paint, stain, and varnish cure. Time that I could use to start other projects.

As business picked up I'd have to build another building to store more wood or I'd be wasting all my time at Lowe's. And then increases the size of my small shop so I could work on multiple projects at one time. At some point I'd have to invest in larger tools that I wouldn't have to wheel around. Eventually I'd have to hire more people. While some of them would build cabinets, others would have to maintain the machinery and keep the shop clean or we'd be knee deep in sawdust. Others would go out and buy wood, sandpaper, glue, nails, stain, and deliver and install the completed units. Which means I'd also have to buy some trucks. Which would need more people for maintenance.

At this point I have enough employees that I need specialized employees to manage the employees and computers to streamline the workflow. Now I need IT guys to keep the computers working. And someone to keep track of the books. And people to keep tabs on them. My stain supply has gone from a gallon a year to a hundred gallons a month and Lowe's doesn't support that so I have to get someone to go out and find a supplier, then lawyers to draw up the contracts. And now I'm also sponsoring golf tournaments to keep the lawyers and executives happy - yes, people are part of this equation. Never forget that personal appetites are a part of EVERY equation.

Taking this example to the absurd, suppose I get so big that I become the supplier for every cabinet built in the country. I would now have to have a huge distribution system requiring thousands of people to maintain equipment, buy wood, transport raw materials and completed products, manage the people, manage the managers, and schmooze government officials who are breathing down my neck about where I'm going to dispose of the thousands of tons of sawdust and scrap wood. And just the buildings to house all the equipment and cabinet makers will cover hundreds of acres. I've got labor managers, facility managers, machinery managers, utility managers, benefits managers, administrative managers, environmental managers, manager managers, and an entire executive structure that now wants golf tournaments in Dubai. My business is a thousand times larger but the structure has grown much, much more than that, and is now full of corporate climbers, greedy executives, and self-serving lawyers who have multiplied the bureaucracy for their own ends. And everybody wonders why my cabinets suck now.

Healthcare is barking up the same tree. The bureaucracy that will be necessary to support this government acquisition will produce the same waste, inefficiency, complacency, and largesse that would obviously come from World Cabinet Makers International. That is why European-style healthcare can't work on a US scale. Sure it is great, I guess, that everybody gets to go to the doctor for free. But the best parts about these systems will scale far less quickly than the worst parts about these systems simply because of the law of Entropy. Everything in life is like this and you learn it in your gut by the time you're twelve years old. Don't ignore this simple fact of life now or we'll wind up with a huge, ravenous dinosaur that that will roar for more, and more, and more food but never be full. It won't be able to move because its bones are too large, nor can we let it die because it'd take a hundred years to rot, so we just have to keep bringing it more, and more, and more of our resources until the basic service it was born to serve will be so deeply buried in bureaucracy that you won't even be able to find it. There is no European healthcare system. There are separate, much smaller completelyt separate systems, in each of the various contries in Europe.

Obama knows this. So do the Capitol Hill morons who are pushing it. But they're not really interested in what the dinosaur will do for us. They're interested in what the dinosaur will do for them. For they are the dinosaur and it is their appetite for power and control that we'll be feeding. And once we've taken that step towards creating the paradise of Vol, there is no turning back.

Below is a brief list of Western European nations whose healthcare people like Obama and Barney Frank want to emulate, followed by their populations. Some of these countries actually have decent systems. The only free healthcare country I know of with a population close to the size of the United States was the former Soviet Union and NOBODY went there for healthcare unless they wanted to be dead.

Germany - 82 million

France - 65 million

Italy - 60 million

England - 51 million

Spain - 46 million

Canada - 33 million

Netherlands - 16 million

Belgium - 10 million

Portugal - 10 million

Sweden - 9 million

Austria - 8 million

Switzerland - 7 million

Denmark - 5 million

Norway - 4 million

Iceland - 319 thousand

United States - 330 million

Soviet Union - 293 million

Futbol Guru, http://mises.org/community/blogs/not-a-lemming

The Three Dirty Words

FutbolGuru — Tue, 17 Mar 2009 15:34:00 GMT

The late George Carlin had seven dirty words. Seven words that you weren’t allowed to say on TV. The list is probably larger now, but you can also say them on TV. At least I hear them on TV regularly. If you are intersted in what they are you can look here.

A dirty word is a strange thing. In the end it is nothing more than a sound, usually but not always, made with the mouth. And when our brains hear this sound they go into a spasm. For social, racial, religious, or other reasons, as we integrate into a society, we are conditioned against certain noises.

These taboo noises can change over time. The N-word wasn’t taboo when I was a child though it was headed that way. When my father was a child it was simply a word. But the F-word was taboo when I was a child. It isn’t anymore, partly because it no longer refers to the sexual act but more than anything infers extreme hatred – or in some cases between friends, fraternal bond. It still isn’t dinner table language, and I don’t feel particularly comfortable using it in mixed language or around children, but by the time my kids are grown, that will probably have changed, too, and there’s no reason it shouldn’t.

Sometimes in politics there are dirty words too. Americans have some. And unlike the N-word or the F-word, I can write them on a blog and not feel… dirty. These words are socialism, communism, and nationalization. The S-word, the C-word, and the N-word. Interestingly, these all have direct parallels with actual, dirty words. Few words, over the last century, have conjured up more intense emotions than when leaders throw around the S, C, and N words. Whether the talk is directed at evil nations that use these dirty words, or domestic leaders thinking about them, the response is always explosive – just like with actual dirty words.

But like actual dirty words, these political dirty words aren’t dirty everywhere. Certainly in the Soviet Union the C-word wasn’t communism, but capitalism. And much of Europe is quite proud of its socialism. Much of the Middle East nationalized their oil industries in the last century, basically taking over the capital investments of foreign countries then contracting them to run the equipment.

Why the differences? Europe wasn’t always socialist. Prior to the October Revolution Russia was capitalist. China has a long capitalist history. And for a long time the Middle East was quite happy with foreign owned oil enterprises. What changed?

What changed was the same thing that is changing here. What is happening with AIG is why words like socialism, communism, and nationalism lose their dirty feel and are replaced on the taboo list by words like capitalism, profit, and speculation. What the west forgets is that the 1917 Revolution in the Soviet Union was economic as much as it was political. The wealthy industrialists in league with the White government had run the Russian economy into the ground through the same shenanigans that AIG is up to now. The public, the working class, the struggling masses, had been completely screwed and had had enough.

One of the most hated ‘classes’ of the Bolshevik Revolution were people they referred to as ‘speculators.’ Those who through their market speculation, drove the market in ways that benefited them financially, while contributing nothing yet causing extensive damage elsewhere. They then carried off their winnings on expensive European vacations or to summer homes on the Black Sea where they ate cavier and drove around in their cars and boats as if everything were completely normal. When the market finally collapsed the government tried to protect the business owners at the expense of the working class. By the time the communists took power the people were only too glad to have them! Of course the rest is history and we don’t want to repeat that though I fear we have already begun to.

I, personally, am enraged at what I am seeing. My own ‘wonderful’ company gave me a bonus of $450 this year – an insult and an outrage. I did some damn good work last year. A single bonus being given to one of these failed AIG speculators would allow me to retire my debt – including my mortgage – and take a couple of years off to pursue my (desired) writing career. And it is my tax dollars that are paying them! This malfeasance of government is the kind of irresponsibility that drives people to redefine their dirty words. I’m just about mad enough to kill. Put me in a mob and I might. President Obama knows this. He also knows he can’t do anything to stop AIG, but by using his bully pulpit to excoriate them he at least is tempering the rage. Will it be enough?

I’m a conservative and a capitalist at heart because I believe that what a man works for, and invests in, should come back to him. Cast your bread on the waters. In America today nothing could be farther from reality. Even the people I know who have become wealthy have used government money to do it. Modern industrialists have basically locked out the common man. To many of us ‘capitalism’ has already become a dirty word. And since we’ve already become socialist because the government is taking huge stakes in private firms, I would rather have the social services I have to pay for than have nothing. Especially since our retirement is also gone. Socialism, suddenly, is not such a bad word either. I can't even believe I'm writing this.

Nationalism? We’re already doing it. And why? Because American businessmen have become so insanely greedy that even government could do a better job. And that is saying a lot because government doesn’t do anything well except kill people and break things. Despite the illusion created by the movie Armageddon, NASA is in reality a complete joke. Contractors do and build everything at NASA. NASA engineers just go to meetings all day and talk about requirements and CDRLs. Health care is headed that way, too. The entire industry from the doctors to the manufacturers of cotton swabs is completely focused on profit, which is why you get terrible service at hospitals and offices.

Dirty words. They change from one generation to the next. They change through intense social upheaval. Where is the tipping point? How far can companies like AIG push before words that used to be 'bad' become 'good' and things start burning down. I hope we don’t find out because I like the old dirty words just fine.

-Futbol Guru, http://mises.org/community/blogs/not-a-lemming

The Religious Right and the Republican Revolution

FutbolGuru — Fri, 13 Mar 2009 14:48:00 GMT

Since the election of Ronald Reagan as President in 1980 the United States has seen a monumental shift of political power.

Prior to this the South had been a Democratic stronghold as a result of the Civil War. Even a hundred years after, it had not been forgotten that Lincoln, a Republican, had invaded and decimated the South over what is still claimed by Southerners as primarily an issue of states rights.

Following the Civil War, reconstruction policy, shaped by the victorious Republicans and enacted by unscrupulous carpetbaggers, stymied economic recovery of the south for generations. Mistrust of Republicans was widespread by the Democratic white population even as the Party of Lincoln was embraced by emancipated Republican-voting blacks.

This general separation of race and party affiliation held until the election of Franklin D. Roosevelt in 1932 when his New Deal provided social programs to which the black population had access. While blacks did not leave the Republican Party en masse immediately, this was the beginning of the exodus. And even though it was the Republican Eisenhower administration that formally began the civil rights movement, it was Kennedy and particularly Johnson who parlayed it into a full-fledged welfare program complete with public housing and direct monetary disbursements. Seen by many blacks as directly benefiting them, the migration to the Democratic Party accelerated greatly.

What resulted, especially in the south, was a tense mix of politics that persisted throughout the sixties and seventies, with local Democratic Parties run exclusively by white men but supported by the vast majority of the Black population. This took time to correct and today we see these parties having become well integrated with a mix of leadership all the way to the top. For this reason it is generally believed that the rise of the religious right was in response to racial pressures when in fact, it was not.

As Blacks were leaving the Republican Party and flocking to the Democrats for economic reasons there were other very important social changes taking place. Most notably the counter-culture of the sixties that embraced faux-peace, tolerance, and came to symbolize the anti-war movement. Because the Democratic Party consisted primarily of liberals, who are less resistant to change, these counter-culture individuals found a much more comfortable home with than with the more traditional, conservative, Republicans irrespective of the changing racial makeup of the party.

But not only did these hippies, as they were called, bring their faux-peace-and-love agenda to the Democratic Party, they also brought high-profile drug use, widespread promiscuity, homosexuality, and other radical notions. Even a cursory examination of the Bible, however, shows that these thoughts and ideas are highly counter to Christian doctrine. Moreover, pro-welfare policies were seen by traditionalists as 'communist' leaning, and part of the tradition of the traditionalists is to reject anything that resembled policies of our sworn enemy, the Soviet Union. Over time these new arrivals to the Democratic Party, with their free-love, drug use, and social rebellion came into conflict with the old guard who still went to church and espoused capitalism. And as they began to infiltrate the leadership of the Party, their ideas started showing up on the platform, first in the North and steadily moving Southward.

This movement progressed and by the late seventies the Democratic Party had, among other liberal changes, become aligned with homosexuality, abortion, and socialism. It was becoming difficult to be a conscientious Christian and retain a Democratic affiliation. That is when the shift occurred. As the Democrat party moved more and more to the left, the Christian constituency of the Democrat Party rebelled and began leaving in droves. So many in fact that the majority of Southern Whites are now Republicans and the majority of Southern Blacks are now Democrats. A reversal of the situation less than 100 years ago.

While this was most pronounced in the south it happened across the nation and the result was what came to be known as “The Religious Right,” a class of religiously affiliated people who were literally forced out of the Democratic Party for ideological reasons. Its peak was probably during the Clinton Administration when numerous government figures changed party affiliation in response to well-known behavior of the then Commander in Chief. The result for the country was a huge displacement of Democrats in the 1994 election with both houses of Congress coming under Republican control.

In recent years it has become convenient for socio-political figures such as Jessie Jackson, Al Sharpton, Jerry Falwell, and George II to solidify their party base (and prolong their personal income engine) by playing race cards only adding to the myth of racially-motivated separation. And since this myth favors the Democratic Party, the Democrats have been more than willing to let it persist. The media, which also leans to the left, has completed the revision of history until it has come to be ‘fact.’ And like lemmings, the majority of the American public has dutifully joined their march towards the sea and the long drop that precedes it.

NEXT: The Religious Wrong and the Republican Retreat

Futbol Guru, http://mises.org/Community/blogs/not-a-lemming

To be, or not to be... In Touch With Reality

FutbolGuru — Mon, 09 Feb 2009 17:02:00 GMT

One of the selling points of Mr. Obama as leader of the ‘free’ world was that he was/is in touch with reality. By this, of course, it is meant that his struggles have been similar to ours so he shares our values, ideals, and sensibilities. Naturally we assume this about him because he did not grow up the privileged son of a wealthy, decorated, World War II pilot. Or the son of an Admiral. He wasn’t a movie-star. He hadn’t been in elected office his entire professional life. The spoon in President Obama’s mouth was not silver but more like the spoons in our own humble mouths; stainless steel or plastic.

But is this assumption valid? For one thing there are many examples of people who came from humble beginnings only to have their world view twisted into something very different from that held by the common man. The easiest example of course has to be Bill Gates. He rose from nothing to become the wealthiest man in the world, and while his philanthropic efforts are laudable, a cursory look at his lifestyle leaves little doubt that he shares few sensibilities with you or I. Another excellent example is nearly every actor in Hollywood. The majority came from humble beginnings but it is far more difficult to find those with feet on the ground than their colleagues who’ve left planet Earth. Of course there are also examples of people who rise far above their origins yet retain their pragmatic view of life. Sam Walton comes to mind, who throughout his life continued to dress as he always had, drove pickup trucks, and visited his stores incognito. Doubtless he enjoyed his wealth and deservedly so, but those how knew him well always maintained that he was respectful and understanding of the average citizen. We all know examples from each group. We hold those in the former in disdain, and those in the latter in high regard.

Now back to Mr. Obama. It was difficult not to be swayed by the notion that his humble beginnings, which were played at length during the campaign, provided him with a world view consistent with prudence, frugality, and pragmatism. In other words, he wasn’t going to be irresponsible and wasteful and would try to reign in those who were. But I’m beginning to wonder if I may have missed the mark, or even been lied to. While Mr. Obama talked a lot about being in touch with reality, his actions since taking office speak a very different language. Most notably his decision to limit the bonuses paid to executives of failing banks.

Mr. Obama has proposed to limit the bonuses paid to executives of failing banks to $500,000. A half-million dollars. Let’s get this straight. These executives work for FAILING BANKS. They drove their business into the ground through greed and took your money with them. It got so bad in fact that they came to the government and begged – BEGGED – for more money. Your money. And for that we’re going to limit their bonus to $500,000? So last year the executive got $1,200,000 and $500,000 is a punishment? And Mr. Obama claims to be in touch with reality? What reality does he claim to be in touch with, because that decision doesn’t exist in my world view.

A half-million dollars. $500,000. How many of us could eliminate our lifetime debt, have money left over for college for our kids, and still knock ten years off our retirement age with $500,000? I’m talking mortgage, cars, credit, everything, wiped clean, and still not have to work for two or three years. Money is time. How much of your life is $500,000 worth. And that’s what he’s limiting as bonuses to failed executives? On top of their base, six-figure pay?

Perhaps it is just because $500,000 is so much less than $750,000,000,000 that he thought it would be okay. Or that it wouldn’t matter. Or that we wouldn’t notice. But this isn’t a matter of degree. The Nazis murdered 6,000,000 Jews during World War II. Does that mean we’re not supposed to prosecute people who only murder one person? What these executives deserve is to be fired, like would happen to you or I if we failed even far less spectacularly. What they should do, if they had a shred of honor and decency, is volunteer to work for free until the problem they created is fixed. Then maybe they can start drawing an hourly wage like the rest of us. But for some reason they, and our politicians, think they are entitled to a standard of living far above our own. And the most amazing thing about it all is that they’re using our money to get it! When they say this, what they really mean is, our lives aren’t important when it come to their standard of living. Feudalism.

In touch with reality. I think he needs a reality check.

-Futbol Guru, http://mises.org/community/blogs/not-a-lemming

The Return of Feudalism

FutbolGuru — Fri, 06 Feb 2009 16:09:00 GMT

They say things come to you in the shower. That doesn’t usually happen with me. More often, during the act of climbing into bed. Then I have to get up and write the idea down, for experience has taught me if I don’t write it down, no matter how Earth-shattering the thought, it will be gone the next morning. But this morning while I was shaving a light bulb went off.

There used to be something called a ‘Retirement Plan.’ You’d go to work for a company and they would begin a retirement plan. Basically they’d put a little money aside each month and when you were old and gray, they’d start siphoning it back to you. It would come agonizingly slow but at least it was there. Sort of like serfdom in the old Feudal systems of Europe. In exchange for work, the Lord provides care and protection.

But retirement plans became expensive. And people clamored about not having any personal control over ‘their’ money. Companies took the opportunity to eliminate the costly retirement plans in favor of giving executives larger bonuses. But our government, always looking out for the little guy, said there had to be something for the workers. (They must have known even then that Social Security wasn’t going to be there.) So they came up with the 401K. You have the option to place a portion of your income, pre-tax, into an investment vehicle over which you have ‘control.’ Some companies even put money in there for you. How nice. It can then grow with the market. Sounds good on paper. Or does it?

Think about what’s actually going on here. The portion of 401K provided by your employer isn’t a gift. It is money that could have just as well come to you in the form of compensation. Sort of like FICA which the government takes for your retirement plan. You pay 7.5% and your employer picks up the other 7.5%. Of course they don’t ‘pick it up.’ They pull it out of funds you earned for a total of 15%. So 15% of your income goes to FICA retirement. Then your company, or you, puts some money into your 401K, in my case 15% for your, uh, retirement. That’s 30% of my income for retirement. Keep in mind that all this cash is flowing monthly into the stock market, continuously, like a river. Even now.

I can’t get to any of this - my - money right now. The Social Security System has no ‘fund’ so there’s nothing there to get. And my 401K isn’t available until I’m too old to use it. I can take it out but I pay a huge penalty, close to half. So it isn’t available to use in my productive life for things like, starting a business, paying for college, or stimulating the economy. So while you can’t use your money to grow your life, there are others who can use your money to grow their lives. This may seem like swindling, but this system was set up by laws.

Yes, you heard me right. While your income isn’t available to you, it is made available to other private citizens in a process protected by U.S. law. Consider the following argument.

Keeping your 401K in a ‘safe’ money market account produces virtually no growth so isn’t a viable retirement plan. So you move it into mutual funds. Mutual funds then make the money available to companies to use as investment capital through the purchase of stocks. These mutual funds are administered by investment banks and other institutions which, as we have all seen, almost without exception, pay their executives ridiculously huge bonuses even though they lost all the money you had been forced to put aside for retirement. So while the money your earned can’t do you any good, it supports a lavish lifestyle for others.

That’s bad enough, but there’s an even more chilling revelation hidden in this web of deceit. One of the strongest arguments against socialism is always the exorbitantly high taxes needed to pay for social services. On the order of forty to fifty percent in some countries. But we’re already paying upwards of 30% for retirement alone! Add income tax and that jumps to 45%. Health care comes out of our checks too, which easily pushes the rate to 50%. State and local taxes drive it north of 60%. In California it’s more like 70%.

Friends, we’re socialist already. But it gets worse. Far worse, because for most of us, there are no social services to be had! The hallmark of the socialist state – the safety net – is missing. While other socialist countries provide retirement and health care – even if it isn’t the best – the middle class in this country has neither. Social Security is insolvent and our 401K’s are worthless. Health care is only available while you’re working. So while we’re socialist, we’re not. We have the high taxes, but not the services. Where did the money go? I hear some Wall Street execs took home in excess of 2 billion dollars in compensation last year.

In fact, we’ve come full circle. We’re back to feudalism. Bad feudalism. In a good feudal relationship, the Lord expected work but provided protection. As long as he wasn’t a cruel, greedy bastard, the system worked surprisingly well. When he was a cruel, greedy bastard the Lord rolled in lavish excess, stopped providing protection, yet demanded the serfs continue to work. The serfs starved and complained but the Lords had lost the fundamental human element of compassion so simply shut the gates on their castles.

The question is, what are we going to do about it? America isn’t feudal Europe. In feudal Europe the people had no rights and the wealthy class had no accountability. We still have rights and there is still accountability. For now. But for how much longer? Those in power have already shown their disdain for good government and good business in favor of hoarding wealth and land. They passed laws which made your money available to them and not to you. They know they have swindled us and that we’ve done nothing about it. When people behave badly without consequence they grow only more bold. Why should they not feel that they are fundamentally entitled just because the masses are still restrained by the concepts of law and ethics? Concepts which they have found to be inconvenient or never had in the first place. Will they win in their latest ruse to increase their fortunes by asking us to buy things we don’t need, made in a country not ours, to ‘jumpstart’ the economy and get money they don’t need flowing back into their coffers?

I’m not a fan of socialism, but it is better than what we have now. And unless we the people take back not only our government, but our economy, we’ll wind up with even less. What is that going to take? There are those who say that the Tree of Liberty requires blood and sometimes they are right. But it hasn’t gone that far yet. Not even close. And in fact, the solution is much simpler, won’t cost a thing, and would actually save us money.

All that in between lifting the razor to my face and pulling it down my cheek. I guess you can have a thought in the shower.

-Futbol Guru, http://mises.org/community/blogs/not-a-lemming

I'm Not One of Those

FutbolGuru — Fri, 02 Jan 2009 03:17:00 GMT

It has become unfashionable in some circles to speak out against the rich. Of course it is a hobby on the left, and it is not at all uncommon for a wealthy congressman or actor to rail against excess, such as former South Carolina Senator Ernest Hollings’, famous statement that, “There’s too much consumin’ goin’ on.” Whether he’s right or wrong, his statement smacks of pandering, and for the most part middle-class Americans have been conditioned against openly criticizing the rich. We are free in this country and part of being free is the freedom to make tons of money and live the way we want. Who’s business is it to question how much money another person makes, even if it rises into the billions betting against our own economy and helping raise oil prices? In fact, speaking out against the rich is generally considered a sign of envy or jealousy and the speaker is often cast as less ambitious/intelligent/or otherwise lucky as the one he’s attacking. Across a large segment of society it has become un-American to speak out against wealth. It is even labeled as communist or socialist.

But it is exactly what I’ve been doing on Not-a-Lemming. Especially in my previous post. And I’m no communist or socialist. Most people who know me would call me a conservative. So how can I claim to be a conservative while at the same time bashing the rich in the land of rugged individualism? Can a conservative do that? And please don’t confuse the term ‘Conservative’ with the party ‘Republican’ or the orientation, ‘Right’. They are not now, nor have they ever been congruent even if their intersection is not the empty set. I can do it because I’m not bashing the rich. I am a staunch capitalist and am strongly in favor of innovation and the entrepreneurial spirit.

I got an iPod shuffle for Christmas. Actually I bought it for myself when I was shopping for my kids. It is one of the most amazing little devices I’ve ever seen. I’m no technophobe and have been aware of, and owned, iPods since their inception. But I remember a world before iPods. A world of transistor radios that rarely worked and clunky cassette and CD Walkmans that chewed through batteries like a teenage druggy burning through an inheritance. I now have a tiny device just a little larger than a postage stamp that can deliver hours of crystal clear music. That is innovation! That is legitimate wealth. Kudos to you Mr. Jobs. Live however you like. You’ve earned it, sir. And you’ve given back.

On the other hand, I live in a town supported primarily by government money. If our spigot ever dries up, this place with shrivel like lettuce in Palm Springs. A lot of people in this town start businesses, grow them, sell them, and get rich. Then they walk around with their heads in the air, literally, and puff about their innovation, sacrifice, and entrepreneurial skill. Except they built their businesses entirely on government money. Sure there were some long days writing proposals for government contracts, but for the most part their was no real personal investment, and the seed product of the business was almost always taken (some say stolen) from a competing company when the new business owner quit and took it with him. And these business owners invariably feel they earned it entirely through their own hard work and rarely give any of it back. Choosing rather to spend their windfall of fancy cars, second homes, and glitzy vacations.

Now Mr. Jobs has a pretty nice home, and I’ll wager that he’s got some nice cars too. And maybe even vacations from time to time, but there is a fundamental difference between what he does, and what these tax-suckers do. And now we’ve taken it to an entirely different level. A level which makes government contractors look like Mother Teresa. I’ll say it again as I’ve said it before, $750,000,000,000. And who acted like we were obligated to give it to them? Banks! Banks that took trillions (that’s $1e12 for you geeks out there) of investor money and evaporated it on bad loans in get-rich-quick schemes. They literally held the international monetary system hostage when they adopted an attitude that said, “Okay, don’t give it to us and see what happens.” How dare those bastards! And after losing our money!

This isn’t capitalism. It’s bad socialism. Perhaps even closer to Hitler’s fascism where the government propped up major industries to keep the war going. Yes, it is banks getting the money, but what about the executives that got them into that position? The failed executives. Did they give back their six-figure+ bonuses? Did they lose their mansions and second homes and personal bank accounts? Did their children have to drop out of the Ivy League schools they are attending? Will they be going on vacation this summer? Are their garages still filled with Mercedes and BMWs? Are their pension plans empty?

These people remained rich, and that is wrong. It is wrong because I’m NOT a communist. It is wrong because I’m NOT a socialist. In Soviet Russia party members became fabulously wealthy by diverting public rubles to their own accounts. All it required was a law. In socialist nations, the upper-class administrates public concerns which pay their salary out of the till. The same people who happen to run the government. And now that is America, too. I'm not saying they aren't entitled to it if they have worked for it. I'm just saying they aren't entitled to 14% of the GNP if they haven't worked for it. Especially after it was their poor management and lack of fiscal responsibility that got us into this mess in the first place.

Furthermore, I can think of no greater depressing effect on innovation and entrepreneurship than the bank bailout and the likely auto bailout. It has gazed straight into the eyes of the middle class and said, “fuck you.” I don’t apologize for the expletive. Expletives have their place, and this is it. This isn’t railing against the rich. This is railing against thievery. This is railing against communism and socialism at its worst. What incentive do I have to continue working night after night on actual products I hope to one day sell to actual people, when those who have figured out how to put their hand in the public till and pull out a dollar seem to have such a higher success rate? America was the land of innovation because innovation was rewarded. But how much longer will that be true in this climate? Especially when it is noted that those who actually earned money are far more willing to capitalize others than those who stole it. As the ratio of earners to thieves tips ever more in favor of the thieves, who for some reason feel they deserve their privileged lifestyle, actual seed money will become less, and less available. Innovators will leave for other places with fewer regulation and more favorable populations, and America’s monopoly on innovation will wither.

It is already happening. Europe, as it emerges from the effects of two world wars is gaining momentum. China, momentarily set back by the economic downturn, will regain her feet. And America, with capitol tied up in the hands of thieves, will seem increasingly less attractive to the talented and ambitious. It’s happened before.

So I reject any and all assertions that I am un-American, or communist, or socialist, or even jealous. I am a capitalist American who believes in fair play, equality of opportunity, and reward for innovation. You want to find a communist, go to an investment bank. He’ll be hiding in the closet under a pile of taxpayer money.

Next: Partners in Crime

-Futbol Guru, http://mises.org/Community/blogs/not-a-lemming

The Tree of Liberty Needs Watering

FutbolGuru — Wed, 17 Dec 2008 16:12:00 GMT

I work in the defense industry. As many may know this industry is funded by the government, which means the money comes from tax-payer dollars. Many towns and cities across this nation survive and in some cases thrive off of these tax dollars. Some people get really, really rich and our military is second to none.

Regardless of ones feelings on this subject, it should come as a comfort that the government keeps pretty close track of this funding. Are there abuses? Certainly. And there is even fraud. But for the most part, a strict accounting system set in place by Federal Law ensures that the government’s money, your taxes and mine, are actually going to produce something, even if that something is pork. At my company we have weekly meetings on virtually every program where government employees charged with tracking spending do exactly that. Individual sessions are even more frequent. By and large the government people are polite and professional, our program managers are kind and professional, and everything slides along in greased grooves.

So what the hell is going on with the bailout? $750,000,000,000 has simply been handed over to banks with zero accountability. 14% of our Gross National Product. 14 cents of every dollar you spent this year. There are no auditors. No accounting. Not even any agency with oversight on how the money is spent. That’s 44 times larger than NASA’s budget request for next year. One and-a-half times larger than the entire military. Army, Navy, Air Force, and Marines, tanks, ships, planes, submarines, salaries, wars, etc. Everything it takes to run the military, including the money that goes to slimy contractors for R&D. With virtually no debate, and no control over how the money will be spent, or even the authority to ask, 14% of our GNP was transferred to banks; the same banks that hit you with a $50 fee for bouncing a check then repossess your car for missing a payment. I would sum this up in a single sentence but it would include the words ‘revolution’ and ‘violent overthrow’ and that would be against the law.

Tomorrow: A Reasonable Solution for the Problem We Have.

Futbol Guru, http://mises.org/Community/blogs/not-a-lemming