The Fable of the Bungling Firemen

The Fable of the Bungling Firemen

02/04/2020Gary Galles

From the time I was an undergraduate, I can remember reading many articles by Leonard Read, founder of the Foundation for Economic Education (FEE). I found his insights valuable enough that I eventually wrote a book, The Apostle of Peace, about what I considered were his best sustained arguments. Many of his shorter arguments were not included. But every so often, I go back and read one or two of his books in search of overlooked inspiration. I did this recently with his 1980 book Seeds of Progress, free online at Mises.org, for its fortieth anniversary.

There, I found a fireman analogy I thought was worth sharing.

Bungling Firemen

  • Imagine this fictitious situation—the firemen of a community answering an alarm and rushing to a burning home. Failing to extinguish the fire immediately, they spray the home with kerosene. The fire worsens. The remedy? Spray it with gasoline! Still worse! On and on with “remedies” galore, each more moronic than the former. These imaginary firemen resemble the millions of political bunglers whose actions lead to “the misery and ruin of many thousands and millions of people.”
  • How do our political bunglers resemble the fictitious firemen[?]…First and foremost, they have no more understanding of how freedom works its wonders….Thus blinded to reality, they see what to them appears as a societal flaw, and then employ coercion to correct it. Their remedy does not work. They then double their coercions. Worse than ever: more flaws appear! Deeper into the mire of our present mess! Their cure? More and more of their foolish interventions!
  • Those who do little if any thinking for themselves are inclined to follow the millions of bunglers who loudly proclaim their know-it-all-ness and promise a heaven on earth.

What Do Bungling Firemen Miss?

  • The keynote to the good life is freedom….To pare over-extended government down to its proper role is to maximize liberty…that heavenly power which releases human creativity.
  • When the free and unfettered market prevails, there is a race for excellence.
  • Each of us should do our little creative things and let everyone else—no exceptions—do theirs. These trillions times trillions of little things are, indeed, the seeds of all human progress and are founded on liberty for one and all.

Living with Bungling Firemen

  • We are living under government by unwise men. And the reason is that many of the wise men among us…fail to see what they could and should be doing to limit government to its principled role of keeping the peace with justice to all.
  • The most bothersome, frustrating and destructive of all are the millions of dictocrats who…sincerely believe that it is their duty to solve your and my problems.
  • Ever so many seekers of political office…actually “think” that we know not how to run our lives; but they never doubt that we are wise enough to select them as our masters!
  • Limiting bungling firemen.
  • Individual liberty depends on the general observance of the principle of equality before the law.
  • Liberty and justice are inseparably associated.
  • An ideal government…is where no one “rules” another! Government is an agency of defense…keeping the peace and invoking a common justice. Period!
  • What, in all good conscience, should be inhibited? The moral codes give the answer: fraud, violence, misrepresentation—thou shalt not steal or kill or do any evil. And government cannot perform this role when over-stepping its proper bounds.

In millions of words over many decades, Leonard Read spent his life trying to “advance freedom by an improved phrasing of its truths.” Those efforts yield those of us who wish to advance freedom today much wisdom, in small as well as large ways. Seeds of Progress is just one example of how even a small investment can yield us substantial returns to that project.

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Colorado Voters Vote for Democrats—and for Tax Cuts

11/05/2020Ryan McMaken

The Colorado Republican Party is the very definition of "sadsack." Over the past fifteen years or so, the party has repeatedly nominated candidates for office that were so inept and so uninspiring that even a population that wanted tax cuts couldn't bring itself to vote for the GOP. How do we know a majority of the voters want tax cuts, even if they keep voting for Democratic governors and legislators? We know this because even when a majority of the voters repeatedly vote Democrat, they simultaneously vote for statewide referenda that lower taxes. 

We saw this in 2016 when a majority of the voters cast ballots for Democrat Jared Polis while at the same time voting down proposals for new taxes and new regulations against businesses.

A similar thing happened this year. A majority of voters went with the Democratic candidate for the US Senate (John Hickenlooper) but simultaneously voted for a cut to the state's income tax. Voters also passed a new law requiring a vote on future attempts to raise fees for state "enterprises" like state parks.

The requirement for a statewide vote has proven to be a significant barrier. Voters in the state have overwhelmingly voted down attempts at raising statewide taxes. At the local level, taxpayers have proven much more tolerant, especially when new taxes are earmarked for specific purposes.  

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What Will It Take for Americans to Consider Breaking Up?

11/04/2020Jeff Deist

Listen to the Audio Mises Wire version of this article.

It’s one thing for mass democracy to produce bad results, in the form of elected politicians or enacted policies. It’s another when the democratic process itself breaks down because nobody trusts the vote or the people who count it. But that’s precisely where we are.

As things stand at this writing, last night’s presidential election remains undecided and looking ugly. At least six states are still uncalled, and both the Trump and Biden camps have their legal teams claiming victory. We may be in for days, weeks, or even months of legal skirmishes, all of which can only add to our intense political (or more accurately cultural) breakdown. 

Today, perhaps 140 million American voters are in purgatory, fearfully wondering what will happen to them if the other guy wins. This is nothing short of a national psychosis, absurd yet deadly real. And it gets worse every four years, despite the narrowing of any “policy” differences between the two parties over recent decades. If anything, presidential votes are overwhelmingly about tribal affiliations with our kind of person, not substantive ideology.

Yes, this is unhealthy. And yes, the psychosis manifests because the stakes are so high. It manifests because government is far too big and rapacious; lawmaking and jurisprudence too centralized in DC; the unitary executive presidency too powerful; and society too politicized. But these are unhelpful truisms. Plenty of Americans abjectly support more government, more centralized political power, an omnipotent president and Supreme Court, and the sharp politicization of every facet of life.

In Nation, State, and Economy Mises talks about a “liberal nationalism” and explains what a confident nation requires:

A nation that believes in itself and its future, a nation that means to stress the sure feeling that its members are bound to one another not merely by accident of birth but also by the common possession of a culture that is valuable above all to each of them.

What, then, is the common culture Americans possess?  What binds us together as a unifying principle? Is it language? Religion? Constitutionalism? Love of country? (What country?) Markets? It certainly is not obvious, and few of us feel optimistic about America’s future. Worse still, covid lockdowns have attenuated the ostensibly nonpolitical spheres of life—from family and work to sports, dining, movies, and travel. When we stare ourselves in the mirror all day, and read everyone’s innermost thoughts on social media, we find familiarity breeds contempt. 

Regardless of how the election turns out, it’s obvious America is not much of a country anymore, much less a nation. The sooner we accept this, the sooner we can get to work asserting the principles of federalism, subsidiarity, nullification, and even secession. None of the current frictions will get better over time, but they can get much worse—and our most important task must be to avoid any movement toward outright civil war. 

There are workable baby steps toward this. Law professor Frank Buckley writes about “secession lite” in his sober and reasoned book on the subject of a national breakup. Buckley sees a third-way approach between our current disfunction and an outright breakup into new political entities, primarily through aggressive federalism and state nullification. This echoes sentiments from Professor Angelo Codevilla, who similarly argues that the feds simply lack the manpower to enforce federal laws and edicts on recalcitrant states. Just as blue states declared sanctuary cities as havens from Trump’s immigration policies, red states could restrict all manner of federal dictates (abortion and gun control come to mind) while simply daring the feds to interfere. At the end of the day, Codevilla reminds us, there are only a few million of them and many millions of us. And progressives too share this sentiment; even if Biden prevails, they remain shaken by the degree of Trump support. In fact the 2016 election saw the New Republic advocate nothing short of a renunciation of the hated red states.

Things don’t have to be this way. Americans are lovely people—generous, open. But politics divides them in the worst and most unnecessary ways. It’s time to break up, and millions of us sense this instinctively. So what’s stopping us?

For one, secession remains bound up with the Civil War and Confederate slavery in the American psyche, distant in time as they are. Manifest Destiny and the westward expansion resulted in a nice, round number of fifty states, a nice, big American number. Throw in a few specious Supreme Court decisions like Texas v. White, and it’s no surprise many Americans still have concrete between their ears on the subject.

But Trump may have changed all that. And if you want political liberty to retain a foothold in the US, if you want Misesian liberalism to show a heartbeat in the West, you should cheer this. 

Americans by and large are lovely people—open, generous, friendly, and quick to forgive. A hyperpoliticized environment, where everything is existential and rooted in race, sex, and sexuality, is deeply at odds with our character and well-being. We deserve to live peaceably as neighbors, even if that means breaking up and creating new political entities. Addressing the reality of our dysfunction is not divisive; the divide already exists. Our task is to apprehend this and end the charade of one nation.

Image source:
Getty
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The Fed Is Still Trying to Understand Inflation

11/04/2020Robert Aro

It’s been over a hundred years since Mises wrote The Theory of Money and Credit and since the inception of the Federal Reserve. Yet the Fed is still trying to figure out inflation, so much so that the Reserve Bank of Cleveland operates the Center for Inflation Research (CFIR) in order to:

improve the understanding of policymakers, researchers, and the public about inflation and the factors that influence its behavior.

The research center’s Inflation 101 infographic makes their understanding quite clear:

Have you ever been shopping and noticed that the prices of things you buy have gone up? If the same things in your shopping basket cost $100 last year and now they cost $105, at a very basic level, that’s “inflation.”

To mainstream economists, mainstream media, and the academic community, the word “inflation” means the increase in prices of consumer goods or services, as measured by the Consumer Price Index (CPI) or other inflation calculators. Using this definition, if the government imposes minimum wage laws or tariffs, if OPEC cuts oil production, or if toilet paper shortages occur due to panic, all which lead to price increases, it constitutes “inflation.” But this definition does not add up. When prices increase, it becomes nearly impossible to say if it was due to the Fed or some other factor. How, then, is the Fed supposed to control inflation, when countless factors contribute to it?

Those familiar with Austrian economics acknowledge this usage of “inflation,” and may use it in conversation, but the Austrian also understands the history and significance of using the term “inflation” to denote the increase in supply of money and credit. Contrast this to the Fed’s research center, which does not even acknowledge inflation’s history or the effects of using its original definition.

Perhaps, since their definition is unclear, they rephrase it:

Explained another way, inflation is ongoing increases in the general price level for goods and services in an economy over time.

This further convolutes understanding, as it introduces the notion of a “price level.” Central planner estimates, we are told:

Statistical agencies start by collecting the prices of a very large number of goods and services. In the case of households, they create a “basket” of goods and services that reflects the items consumed by households. The basket does not contain every good or service…

Once the basket of goods is decided they determine:

the current value of the basket by calculating how much the basket would cost at today’s prices (multiplying each item’s quantity by its price today and summing up). Next, they determine the value of the basket by calculating how much the basket would cost in a base period (multiplying each item’s quantity by its base period price). 

They fail to mention that the items and quantities in the basket can change from period to period, but they go on to explain “relative weights”:

In the case of a price index for consumers, statistical agencies derive the relative weights from consumers’ expenditure patterns using information from consumer surveys and business surveys.

Thus, the Fed understands inflation only when statisticians create a basket of goods and assign a relative weight of importance to each item. Between each period of comparison, the items, their quantities, and the relative weight of importance may be adjusted. Once complete, the Fed has their “data,” used to justify their policies. Nowhere does anyone seem to ask what the harm to society would be if their data is incorrect, or worse, inherently flawed.

Austrian economists have been vocal about the latter, saying there is an inherent problem of “measuring inflation,” for many generations, yet a research center which claims to be dedicated to inflation research somehow remains unaware. And even as recently as last year, Frank Shostak wrote a concise essay on the price level, concluding that:

Contrary to popular thinking, there is no such thing as price level that should be stabilized by the central bank in order to promote economic prosperity. Conceptually, the price level cannot be ascertained notwithstanding the most sophisticated mathematics.

Whether it’s the price level, defining inflation, or expansion of the money supply and its side effects, the Austrian school has written against these interventions for over a century. It would benefit society if an economic research center run by the Fed would consider these ideas; unfortunately, it seems they either don’t know or don’t care.

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In Praise of the Cynical Voter

11/04/2020Ryan McMaken

I don’t subscribe to the rather strained arguments some libertarians make about voting. I don’t think casting a vote implies the voter is tacitly endorsing the political system. I don’t think a vote means the voter implicitly agrees to blithely accept the outcome.  I don’t even think a voter necessarily likes the candidate for which he or she has voted.

Many of these ideas date back to the libertarian anarchists of the late nineteenth century, during which Benjamin Tucker, for example, wrote “[e]very man who casts a ballot necessarily uses it in offense against American liberty, it being the chief instrument of American slavery.”

And then there was Francis D. Tandy, who concluded, "Political methods must be condemned without even these qualifications. The ballot is only a bullet in another form."

The problem with these claims is that they tend to rest on the assumption that the voter and the regime both agree on what a vote means.

As far as the regime is concerned, of course, a vote should mean the voter agrees to peacefully abide by the result of a free election. The regime also believes a vote means the voter endorses whatever laws or policies are adopted by the voter's “representative.” This is why the regime wants high voter turnout and why it claims that democratic elections provide the regime with a voter “mandate.” 

[RELATED: "No, Voting Doesn't Mean You 'Support the System'" by Ryan McMaken]

But do voters agree that this is what a vote means? Perhaps some voters do. But more likely, many voters attribute no such meaning to their votes. There is no reason to assume, for example, that a voter thinks a vote for a certain candidate is an endorsement of every monstrous piece of legislation handed down by the regime. Nor can we assume voters believe their vote grants a mandate to the regime in general. This is especially true when the voter’s preferred candidate loses. Any number of  “not my president” memes in recent years would suggest this is the case.

It’s just as likely that a great many voters view voting as a means of playing defense against a state apparatus they view as threatening. That is, the voters may view the act of voting as merely one means of objecting to certain candidates or policies. Whether or not the voter’s intent is accurately interpreted by the regime, of course, is another matter.

Rather, a voter’s actions could be likened to those of prisoner who is given the option of voting on which prison guard he prefers. Prison guard A beats the inmates ten times per day. But prison guard B beats them only five times a day. Clearly, it would be a stretch to assert that a vote for prison guard B implies that the voter approves the whole prison guard apparatus and that the voter therefore endorses beatings. Rather, the situation is simply one in which the voter was given a chance to try to slightly improve his situation and acted accordingly.

[RELATED: “"The Will of the People" Is a Myth“ by Ryan McMaken]

This type of voting we might call “cynical voting.” The cynical voter casts a vote with the belief that it might improve his situation, or at least throw some obstacles in front of a regime that is bent on inflicting greater damage on the voters.  But the cynical voter also understands that his vote might do very little to change the situation and that his preferred candidates may also all lose. 

In our prisoner analogy, let’s assume a voter casts his ballot in favor of fewer beatings. But then a week later that same voter gets his hands on a contraband machine gun with enough ammo to kill every prison guard. Does an earlier vote for fewer beatings somehow preclude the voter from later using that machine gun? There’s no reason to assume so.  Nonetheless, the “voting implies consent” argument rather strangely seems to assume that the voter views his vote as the end-all be-all of political action. 

The cynical voter doesn’t believe the act of voting limits his range of options in other areas. He doesn’t think, "golly, my candidate lost, but I voted, so I guess every horrible thing the government does to me in the next two (or four or six) years is a-okay!" If other methods of fighting the regime present themselves, the cynical voter is not afraid to use them. Only someone who has fully and utterly bought into propaganda would accept the notion that a vote precludes other possibly-more-effective forms of political resistance.

Moreover, the ideal cynical voter rejects all the myths underlying the proregime philosophy of voting. The cynical voter understands, for example, that elected representatives do not actually represent the voter. Given the diversity of voters, this is an impossibility. The problem gets worse as the jurisdiction gets larger.

[RELATED: “No Matter How You Vote, Politicians Don't Represent You“ by Ryan McMaken]

The well-informed cynical voter also understands that voting does not grant a mandate to the winning side. This is especially true if the winning side wins with anything less than 100 percent. What if the winner receives only 90 percent of the vote? Does that make the wishes and preferences of the other 10 percent null and void? In reality, of course, few politicians ever win a race by 90 percent. Many of them win with less than 55 percent of the vote. Some win with only a plurality of less than 50 percent. Clearly, such a situation cannot honestly be said to provide the winner with any sort of mandate. More naïve observers—exactly the sorts of people who think a ballot is just like a bullet—may believe this, however. 

Essentially, the voting-is-violence crowd is buying into the regime's preferred view of voting. But in reality, it is likely that countless ordinary voters take a far more cynical and sophisticated view of voting than their detractors think. Many by voting are simply trying to rid themselves of the most dangerous threats they face. It's hard to fault them for this.

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Three States Libertarian Voters May Decide

11/02/2020Tho Bishop

For a short period of time, America’s libertarian moment was a go-to topic for political pundits in a variety of publications. Since 2016, the role of libertarians in political discourse has tended to devolve away from a relevant political demographic into a weird scapegoat for the Left and Right. From the left, pundits—assisted by a certain clique of Beltway-dwelling libertarians—have focused on an alleged “libertarian to alt-right pipeline.” Interestingly, a group that often mocked “conspiracy theorists” in the movement suddenly found Nazis behind every speech promoting political decentralization and social cooperation.

Meanwhile, a new generation of right thought leaders, including Tucker Carlson and Steve Bannon, identified libertarians and “Austrian economics” as a major driver in what they saw as a corporate takeover of American government. While both Carlson and Bannon deserve credit for helping normalize a noninterventionist foreign policy in the mainstream of Republican Party politics, their woefully misinformed attacked on Austrians actively undermines many of their own objectives. While it’s possible their choice of language was intended to target a certain group of billionaire libertarian benefactors, reading Mises, Rothbard, and Hoppe would assist both of them in properly identifying their actual enemy: fiat money and central banking.

Still, while the libertarian electorate is not as popular a topic as it once was, it could actually be a very important demographic this year. In particular, there are three states where Gary Johnson voters could flip enough delegates to give one party an electoral college victory.

Nevada

The largest of these states is Nevada, with six electoral votes. Home of FreedomFest, a libertarian event and one of Donald Trump’s first official campaign events as a candidate in 2015, the state is dominated by the population centers of Las Vegas and Reno.

In 2016, Donald Trump lost the state to Hillary Clinton by around 2,700 votes. Gary Johnson surpassed the difference with 37,000 voters. As was the case for the Libertarian Party as a whole, Governor Johnson’s 3 percent advantage was historically high for America’s largest third party (Johnson came in with just shy of 11,000 votes in 2012).

What makes Nevada interesting is the state’s obvious reliance on the tourism industry. While much media attention has been paid to Joe Biden’s comments about fracking and its impact on Pennsylvania workers dependent upon that industry, less attention has been paid to how tourist-dependent economies may view stark differences in covid.

Nevada’s prolockdown Democratic governor has become increasingly unpopular with independents in the state. A recent poll showed 56 percent of independents disapproving of the response. Perhaps a sign of the political unpopularity of lockdowns is decreased turnout among Democratic voters. According to TargetSmart, Democrats had 42 percent of the turnout the day before the election in 2016. In 2020, that’s dropped by 2 percent. This is particularly telling given the Biden campaign’s focus on VBM (vote by mail), which pushed dependable Democratic votes earlier into the election cycle.

Meanwhile, Las Vegas’s Clark County has seen a 2 percent increase in independent voters. The question is, Are independent voters motivated more by an anti-Trump narrative or concerns about the potential of executive action on future covid lockdowns?

If so, this could be an unexpected Trump victory.

One additional variable that could lead to an extra messy election? Nevada is a state that went to a universal vote-by-mail model, with ballots sent to every registered voter. We’ve already seen the state’s turnout surpass 2016. This is assumed to be a major advantage for Democrats, but perhaps the true “silent majority” may be more complex than pundits assume.

New Hampshire

The most iconic libertarian state in the Union continues to be New Hampshire, which has largely remained a beacon of sanity relative to its fellow New England states during the age of covid. In 2016, some polls saw Hillary Clinton going into the election with as much as an 11 percent advantage, though Trump ended up losing by just above three thousand votes.

This year, polls have shown a consistently large lead for Joe Biden since May. Without any in-person early voting, there is little voter data that would point to a surprise outcome. Should the results play out as prognosticated, it perhaps highlights missed opportunities by the Trump administration to deliver on some of 2016’s more libertarian promises.

If Donald Trump ends up losing by fewer than New Hampshire’s four electoral votes, the defeat may be the direct result of the administration’s inability to end any of the various wars unpopular with voters. While the president has promised to withdraw from Afghanistan and Iraq in the near future and has paid lip service to a federal end to the war on marijuana, the lack of follow-through may have alienated many Live Free or Die state voters.

Kind tweets to Ron Paul will only go so far with proudly ideological voters.

New Mexico

One of the major narratives of the 2016 campaign has been President Trump’s success with Hispanic voters. While the Left often makes the mistake of seeing Hispanic voters as a homogenous voting block, significant differences exist between Hispanic populations across the country. Miami’s Cubans vote very differently from Mexicans living in Texas.

That being said, organic Spanish-language content created by Trump supporters is the closest this election cycle has seen to the meme magic of 2016. If Trump is able to improve his performance with Hispanic voters, this is one state that could become interesting—and this has become reflected in the coinciding Senate race.

In 2016, Donald Trump lost to Hillary Clinton by just over 8 percent. The same year, Gary Johnson earned over 9 percent of voters. If we acknowledge the possibility that Jo Jorgenson lacks the same relationship with New Mexico voters that its former governor did, where might these 74,000+ voters land?

Like Nevada, New Mexico has a Democrat governor who has taken a strong government hand in the face of the coronavirus. While business owners have pushed back against some of the enforcement, the public as a whole has seemed to be more supportive of Governor Grisham’s actions.

The only potential lifeline to the Trump campaign may be the concerns about what Democrats could do to the fracking industry, which is a major economic driver in the state. Still, this looks like the least likely of the three to be in play.

Image source:
Pixabay
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Can Incumbent Trump Win with an Anti-establishment Message?

10/30/2020Alice Salles

Tuesday is the last chance for (most) Americans to cast their vote for president. What will make the difference in attaining victory? When it comes to messaging, Team Biden relies on elite news outlets for assurances of victory, while Team Trump’s preferred sources are blacklisted by social media and ignored by broadcast news organization.

But what does recent history tell us about which voice is most likely to prevail?

In 2016, Trump’s unusual and unrefined demeanor brought him closer to those who had long been left out of the political discourse.

But despite his apparent popular appeal, pundits and major cable news outlets all but gave former secretary of state Hillary Clinton the victory. On Election Day, however, things didn't go as the Democrats planned. Few predicted the outcome.

After four years, his anti-establishment rhetoric has continued to cause many to see him as the antipolitician candidate, even though he has ultimately failed to deliver on many of his promises.

Can the populist strategy work again?

Maybe. The lessons of 2016—taking a stand against the status quo—don’t seem to have stuck with Democratic activists. The party has remained energized by its long dedication to exploiting identity politics and pushing ideological concepts that often don’t resonate with its own base.

From promising to maintain the US's failed foreign policy strategy in the Middle East to pushing the already debunked “Russia did it” talking point to exhaustion, the Democrats have stuck with what has been used to shore up the base in recent years, while ignoring much of the center. Instead, they have chosen to double down, even threatening with physical violence those who oppose their message.

Consider Biden’s running mate, Kamala Harris, who went as far as promising that the violent riots that followed the death of George Floyd “were not going to stop” until “there are people in the system who are willing or pushing” to make a difference.

Biden, meanwhile has hurled threats at much of the population by promising “nationalization” of mask wearing and vaccine distribution. Presumably, such measures would require enforcement by armed agents of the state.

Many voters are likely to find Trump to be relatively laissez-faire in comparison. Yet that remains a low bar. Trump promises to downsize the US military’s presence in Afghanistan but has not done so. But in practice, his approach to fighting the pandemic has been far less reliant on mandates and state coercion than what Biden proposes.

When it comes down to the main differences between the two candidates, many voters may ultimately conclude it’s clear that Biden is the professional politician whereas Trump remains the loudmouthed, anti-establishment guy. This may help Trump with some voters. Moreover, although Trump is now an incumbent, he is nonetheless running against lifelong politicians like Biden. As Trump was careful to note during the first debate: “If I thought [Biden] did a good job, I never would have run.”

The other difference is that now, compared to 2016, Americans are likely to be even more weary of politics thanks to the coronavirus lockdowns, BLM riots, and the destruction of businesses by both the mob and state governments. Whatever the motivation, Trump stands to benefit so long as he can cultivate the image of being the candidate fighting against the madness while Biden and Harris stand stoically as the candidates willing to legitimize the mob.

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A Collection of Bovardian Epigrams

10/29/2020James Bovard

Election Day can be the longest day of the year. Especially if the presidential race remains undecided late into the evening, neither Xanax nor vodka may be enough to kill the pain. In lieu of other sedatives, following are some cheerful lines which might blunt the impact of the prattling on CNN or MSNBC, though there is no known antidote to PBS’s piety.

Voting

  • The most dangerous political illusion is that votes limit politicians’ power.
  • Nowadays, we have elections in lieu of freedom.
  • The defects in any system of choosing rulers outweigh the risks of letting people run their own lives.
  • People are entitled to far more information when testing baldness cures than when casting votes that could lead to war.
  • What’s the point of voting if “government under the law” is not a choice on Election Day?
  • Having a vote does nothing to prevent a person from being molested by the TSA, spied on by the NSA, or harassed by the IRS.
  • Politicians are increasingly dividing Americans into two classes—those who work for a living and those who vote for a living.
  • Voting for lesser evils makes Washington no less odious.
  • Politicians have mandated warning labels for almost everything except voting booths.
  • On Election Day, Americans are more likely to be deluded by their own government than by foreigners.
  • Politicians talk as if voting magically protects the rights of everyone within a fifty-mile radius of the polling booth.
  • Political consent is defined these days as rape was defined a generation or two ago: people consent to anything which they do not forcibly resist.

Democracy

  • Modern democracy pretends that people can control what they do not understand.
  • We have a drive-by democracy where politicians wave to voters every few years and otherwise do as they please.
  • The more power politicians capture, the more illusory democracy becomes.
  • A democratic government that respects no limits on its own power is a ticking time bomb, waiting to destroy the rights it was created to protect.
  • The surest effect of exalting democracy is to make it easier for politicians to drag everyone else down.
  • The Washington Post’s motto is “Democracy Dies in Darkness.” But democracy also dies from too many Iron Fists.
  • The phrases which consecrate democracy seep into Americans’ minds like buried hazardous waste.
  • Rather than a democracy, we increasingly have an elective dictatorship. Voters merely designate who will violate the laws and the Constitution.
  • Democracy unleashes the State in the name of the people.
  • The more that democracy is presumed to be inevitable, the more likely it will self-destruct.
  • America is now an Attention Deficit Democracy where citizens’ ignorance and apathy entitle politicians to do as they damn well please.
  • Democracy must be something more than two wolves and a sheep voting on what to have for dinner.
  • Americans now embrace the same myths about democracy that downtrodden European peasants formerly swallowed about monarchy.
  • Instead of revealing the “will of the people,” election results are often only a one-day snapshot of transient mass delusions.
  • Nothing happens after Election Day to make politicians less venal.

Lying

  • A lie that is accepted by a sufficient number of ignorant voters becomes a political truth.
  • America is increasingly a “Garbage In, Garbage Out” democracy. Politicians dupe citizens and then invoke deluded votes to stretch their power.
  • Promising to “speak truth to power” is the favorite vow in the most deceitful city in America.
  • Truth delayed is truth defused.
  •  A successful politician is often merely someone who bamboozled more voters than the other liar running for office.
  • The biggest election frauds usually occur before the voting booths open.
  • Politicians nowadays treat Americans like medical orderlies treat Alzheimer’s patients, telling them anything that will keep them subdued. It doesn’t matter what untruths the people are fed because they will quickly forget.
  • When people blindly trust politicians, the biggest liars win.
  • Secrecy and lying are often two sides of the same political coin.
  • The more powerful government becomes, the more abuses it commits, and the more lies it must tell.

Government et Cetera

  • America is rapidly becoming a two-tier society: those whom the law fails to restrain, and those whom the law fails to protect.
  • Idealism these days is often only positive thinking about growing servitude.
  • It is naïve to expect governments to descend step-by-step into barbarism—as if there is a train schedule to political hell with easy exits along the way.
  • The first duty of today's citizen is to assume the best of government, while federal agents assume the worst of him.
  • America needs fewer laws, not more prisons.
  • Every recent American commander in chief has expanded and exploited the dictatorial potential of the presidency.
  • Many people reason about political power like sheep who ignore the wolf until they feel its teeth.
  • Political saviors almost always cost more than they deliver.
  • There is no such thing as retroactive self-government.
  • The arrogance of power is the best hope for the survival of freedom.
  • Washingtonians view individual freedom like an ancient superstition they must pretend to respect.
  • Paternalism is a desperate gamble that lying politicians will honestly care for those who fall under their sway.
  • Citizens should distrust politicians who distrust freedom.
  • The Night Watchman State has been replaced by Highway Robber States in which no asset or right is safe from marauding politicians.
  • P.T. Barnum may have been thinking of Washington journalists when he said there’s a sucker born every minute.
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Will a Nonpolitical "Silent Majority" Stop the Left?

10/28/2020Tho Bishop

The 2020 campaign is down to its final week, with each party and pundit preparing the ammo they need to either take a victory lap or explain away their defeat. In the age of covid, the Democratic Party has pushed heavily a vote-by-mail campaign that places their successes in the hands of the ability of voters to successfully negotiate the postal system, while Trump’s team is relying on MAGA rallies to motivate in-person early voting. The combination of the two has the race projected to be the largest projected voter turnout in over a century.

According to conventional wisdom, this is a major win for Joe Biden’s team. In fact, strong voter turnout in states like Texas and Georgia has anxious pundits questioning whether this is finally the year these red state stalwarts flip blue. But is conventional wisdom correct?

If we do in fact see a major surge of voter behavior, it’s useful to consider the sort of voter who may be turning out to cast a vote for the first time. Both sides have their own preferred narrative here: Democrats see a nation of politically oppressed groups that can be activated by tapping into their sense of injustice, while Republicans see a “silent majority” that wants, to quote @realDonaldtrump, “LAW AND ORDER!”

Historically, the demonstrated preference of American voters has firmly been political apathy. In 2016, if Did Not Vote had been a candidate, it would have won with an impressive 471 votes. As such, to the extent that the “silent majority” exists, we can perhaps view it as “antipolitical.”

The question, then, is which candidate makes the best appeal to the “antipolitical”?

If you were to listen to the corporate press, the obvious answer would be that President Trump is so uniquely bad that any decent person would be motivated to fire him. Helping this argument is general disapproval of the president’s handling of covid (though specific criticisms are not made clear in the poll), as well as the fact his favorability rating is below 50 percent (though no worse than in 2016). Working against this narrative is the fact that, in spite of what 2020 has brought, 56 percent of voters told Gallup that they are better off now than where they were four years ago.

Considering the amount of money that was spent in 2016 unsuccessfully making the case that Donald Trump was a uniquely unacceptable outcome for American democracy, it’s fair to question whether four years of “Orange Man Bad” is a political message that would electrify new votes.

So what has changed in four years?

Well, one obvious change is social media and the willingness of Big Tech to leverage their platforms for purely partisan purposes. In 2016, Americans were able to find and read and share materials such as leaked campaign emails, or episodes of The Alex Jones Show. American democracy allowed for voters to make their own judgments on these matters.

Now we're told that American democracy depends on protecting voters from potential “disinformation.” The most obvious example is social media’s treatment of files allegedly found on a lost laptop, which Big Tech has desperately tried to hide from American voters. The New York Post, one of America’s oldest newspapers, remains locked out of their Twitter account for daring to publish the content.

While this episode highlights important questions about the relationship between Big Tech and society, this is simply an example of a larger trend of the progressive left pushing politics beyond elections. While the political agenda of Facebook and Twitter may have a more direct impact on how we use the product than how Gillette targets its advertising or what the next woke flavor of Ben and Jerry’s is, the Left and its corporate allies have made the decision that politics is too important to not be talked about.

But what if normal Americans do not want to be lectured to? Particularly when those lectures come from the people who engage in such performative hypocrisy as celebrating massive protests in the name of “social justice” while scolding you for going to church?

If “bread and circuses” really are all that is needed to keep the masses content, what happens when you pervert pastimes into “soy and political lectures”?

What if there is a large section of the country that did not vote for Trump in 2016, sees plenty of faults with the man and his policies, but sees him and his tweets as far less dangerous than self-righteous lefties who use their social media to get random people fired? If polling trends are accurate, we've already seen President Trump greatly enhance his position with minority voters, whose communities tend to be the most hostile to the Left's fetish for political correctness. In particular, Biden may win 100 percent of the self-identified Latinx demographic, but Trump appears set to perform significantly better with Hispanic voters in both Florida and the Sun Belt.

Perhaps real populism in America is simply letting people raise a family and grill in peace?

If so, maybe Murray Rothbard was right about the potential for a uniquely libertarian brand of populism in America.

One thing is for sure if this theory holds: political pundits in New York and Washington, DC will find themselves looking foolish in 2020. Again.

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Goldman Sachs Bribes a Foreign Government

10/27/2020Robert Aro

Goldman Sachs was fined $2.9 Billion while pleading guilty to bribery charges involving the Malaysian government, breaking a record for the largest penalty under the Foreign Corrupt Practices Act. Under US law it is illegal to bribe foreign leaders, as reported by CNN. They quoted Goldman’s CEO who is “pleased to be putting the matter behind us.” Widely recognized as one of the most important financial institutions in the world, Goldman will survive, as the firm has approximately $153 Billion in cash and will likely claw back executive bonuses.

It could have been worse, considering the case centers around $4.5 Billion that was stolen from Malaysia’s Sovereign Wealth Fund, in which:

The money was used to buy New York condos, hotels, yachts and a jet, and to fund movies such as "The Wolf of Wall Street." 

The fine is less than the money allegedly stolen! Even more serendipitous for shareholders, Forbes notes:

The settlement amount is lower than the $3.2 billion Goldman set aside for ongoing regulatory and legal matters as of Sept. 30 and was largely accounted for in its 2020 financial results.

As far as continual compliance is concerned:

Goldman is not mandated to hire a compliance monitor… which would be costly and could have been long-term.

Is this an isolated incident? Or does it reflect systemic issues of power, corruption and theft? And what, if anything, does this have to do with the Federal Reserve?

On Thursday the Fed announced a fine:

$154 million for the firm's failure to maintain appropriate oversight, internal controls, and risk management with respect to Goldman's involvement in a far-reaching scheme to defraud a Malaysian state-owned investment and development company…

We know the Fed “conducts the nation’s monetary policy to promote maximum employment, stable prices, and moderate long-term interest rates,” but there are additional functions beyond what the central bank is charged, including regulation and supervision of financial institutions. Per the 10th edition of The Federal Reserve System Purposes & Functions:

Regulation entails establishing the rules within which financial institutions must operate… Once the rules and regulations are established, supervision… seeks to ensure that an institution complies with those rules and regulations, and that it operates in a safe and sound manner.

The Federal Reserve is one of the few, or only, regulators who literally pays the entity which it regulates! Under section 7 of the Federal Reserve Act:

Dividend Amount. After all necessary expenses of a Federal reserve bank have been paid or provided for, the stockholders of the bank shall be entitled to receive an annual dividend on paid-in capital stock…

Typically when an entity is mandated to be regulated by the government, that entity must pay the government (or its agency) an annual fee to cover the costs associated with the regulatory burden on the taxpayers. This is not true for the Fed. Despite having free reign on money creation, it is also funded via paid-in capital stock. The list of stockholders remains an elusive find, but it is well understood to be the very banks in which the Fed regulates. There is no secret nor conspiracy to this, as seen on the 2019 KPMG annual audit report, showing “Dividends on Capital Stock” was $999 million for 2018 and $714 million for 2019. Per the Act, this dividend is cumulative and paid out before the US Treasury receives its surplus payout. Perhaps an act of Congress will one day change the payment structure of the Fed. Until then, it’s the Fed’s world, taxpayers are just footing the bill.

…As for Goldman Sachs, they’ll be okay. Luck for them, it appears no jail time will be served for what could be a billion dollar theft.

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The Fed Is Now Fighting Housing Inequality?

10/27/2020Robert Aro

While not explicitly defined, the “housing challenge” invokes an idea of “inequality,” and the Fed aims to fight it. Like all problems, we must find the root cause should we wish to find resolution. If housing unaffordability is an issue the Fed chooses to combat, perhaps they should look into their own monetary policies first. Should their interventions be the cause of the problem, refraining from intervention becomes the viable solution. Nevertheless, when the Fed champions a cause, even beyond the scope of their mandate, there is little anyone can do to stop it.

At the National Housing Conference on Tuesday, Governor Lael Brainard harkened back to days of the last financial crisis:

During the mortgage foreclosure crisis, many families around the country suffered the devastating loss of their home through no fault of their own, and homeownership rates have not recovered to pre-crisis levels for the affected groups. 

She likens the current crisis to the previous, where, through no fault of the public or the Fed, external events caused financial hardship, targeting minorities and those in the lowest income bracket the most. Due to COVID, we are told, rents and home prices have continued to rise while the supply of “affordable housing” has decreased. Brainard mentions several interventions such as unemployment benefits and various subsidies in an attempt to fight unaffordability. Of course, it’s easy for a Governor to place the blame of a housing crisis on everything except the Fed and propose more intervention. But when interest rate manipulation and inflationist policies are considered, it becomes a tough sell.

Beginning with the Effective Federal Funds Rate, since 2008 rates have stayed near zero. In this time, these abnormally low rates contributed to the perpetual rise in asset prices. For anyone in a low to middle income, the last thing they’d want is for housing prices to continually increase as it makes life that much more expensive. Rising house prices are even addressed in her speech:

Many households have been unable to purchase a home since the last financial crisis due to a confluence of factors, including higher home prices and stricter lending standards. For those who have purchased a home, higher home prices have translated into higher debt levels relative to household income.

Few seem to ask why housing prices are inexplicably increasing and what effect artificially low interest rates have on fueling this housing boom (bubble). As for lending standards, as higher home prices require a greater debt burden, it’s not surprising lending has become tighter than the decade prior.

What of increases to the money supply and how does this affect housing? The Fed’s balance sheet currently sits north of $7 Trillion, with no promise to decrease it any time soon. This was reiterated by Vice Chair Clarida a day before Brainard’s speech, who promised to “maintain an accommodative stance of monetary policy until these outcomes” are achieved; the outcomes being maximum employment and:

until inflation has risen to 2 percent, and until inflation is on track to moderately exceed 2 percent for some time.

In other words, expect continual asset purchases for a very long time. Yet no one at the Fed seems to consider the disconnect in perpetually claiming low consumer prices despite balance sheet expansion, while household debt levels and those dependent on financial aid appear to be increasing.

The failure to understand money supply vis-a-vis the unaffordability of life is displayed by Brainard who notes that “22 percent of renters pay more than half of their income toward rent.” This leaves little room for families to save. It’s debatable whether rent should be half of the average person’s income and it’s the price of consumer goods that are too high, or whether goods are priced “just right” but rents are too high.

Either way, any mention of inequality requires citing the $7 Trillion of money created since the last crisis. Of this amount, we know the overwhelming majority did not go to the disenfranchised. Not to say this money should have been better allocated, but to say this money should have never been created at all. If inequality is a problem in America, then look to see who received the $7 Trillion first and how their lives were bettered at the expense of the masses. Only then can we have a serious discussion about inequality in this country.

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