Power & Market

The Economics of Working from Home

Strict lockdowns imposed by governments to slow the spread of COVID-19 continue to force more and more people around the planet into a “work from home” setup. This is problematic for a number of reasons as the citizens of countries around the world have to go about work and entrepreneurial activities under a number of restrictions: Tomas Forgac summarized major problems encountered by people who try to go on with their lives amidst quarantine requirements.

Others have already commented on policies related to government action against COVID-19, so rather than analyze such restrictions directly, this article will focus on insights and lessons learned from applying Austrian perspectives of time coordination to the difficulties present in the global phenomenon of working from home. Theoretically there should be many advantages due to more and more work and business efforts going digital, but in practice, this is not quite the truth.

The Theoretical Pros

The Austrian perspective values time and coordination. Where other economists see things primarily in terms of labor and capital, there is also a value in seeing things in terms of how subjective inferences about the future are made in a particular context, and at particular points in time. In a free market economy, having access to information is a must for things to happen efficiently and smoothly. This would lead to better coordination among individual actors.

In the initial weeks of the lockdowns, many seemed to like the idea of working from home. Similarly, the idea seems attractive to businesses as well: a lot of the troublesome things that come with the daily grind are eliminated entirely as colleagues and employees use their smartphones and computers to react instantly to work matters. With limitations and mandates against going out, it becomes natural to make the most out of the situation and explore better ways of doing things.

That said, when business meetings are no longer made in person, when everything is said in a clearly written email, when people no longer have to spend hours commuting to and from work, then coordination should be easier, and efficiency should be increased, right? Not quite.

The Practical Cons

To illustrate the drawbacks of the work from home setup, we have to consider an important concept in Austrian economics, known as “opportunity cost”. To put it simply, this is not merely the monetary cost of something. Rather, it is the cost of what is given up when pursuing something else. Compatible with this is a concept borrowed from Ivan Illich, the idea of “shadow work”, which is essentially the time spent on the unpaid work one needs to do in order to actually perform paid labor.

A simple example should illustrate these two concepts. Let us say that a person with a 9:00 A.M. to 6:00 P.M. job (an eight hour work day, lunch time excluded) spends an hour commuting to work in the morning and another hour commuting back home at the end of the day. A normal consideration would be to say that this person only works eight hours a day. However, when we use opportunity costs and shadow work to measure time, we see different dimensions instead.

It may well be that a worker would like to shorten their lunch break for various reasons, such as to run an errand or even to finish a task that “cannot wait”. Doing so is a classic example of opportunity cost, as lunch is considered “free” time, but the time isn’t actually free, because that time could be used to do something else instead. The two hour total of daily commuting from home to work and vice-versa, on the other hand, could be called shadow work. This is time not considered part of the working hours per se, but it does take up part of a work day, and it is a necessary task that needs to be done in order to actually do a job. That’s a ten or eleven hour work day in the eyes of the employee, and not just an eight hour one!

In practice, an employee in such a situation might choose to, for personal reasons, forego lunch one day to finish their daily tasks as fast as possible, so that they might leave work early and beat the afternoon rush back home. In this case, the employee is making a subjective and time-based value decision: rather than stay at work until 6:00 P.M., the employee finishes work early by skipping lunch and thus manages to go home as soon as possible, “saving” their time.

This leads to the realities that come with lockdowns. In a work from home scenario there is no need to commute or spend time in traffic. Likewise, the comforts of being able to prepare and eat one’s food at home can tempt people into believing that the new set up is convenient in terms of “saving” time. It is easy to fall into the trap of thinking that opportunity costs and shadow work can be mitigated or eliminated because everything is now done in one place.

One might even be fooled to feel thankful for compulsory regulations that limit movement just because the hassle of distractions and personal costs of time associated with long business meetings, hours stuck in traffic, and so on, are suddenly gone. Poof! Just like that. Yet fast forward to the end of 2020, and we find out that, as with many things in reality, life isn’t that simple.

For example, the distinction between private life and work became blurred in many aspects, which certainly didn’t help the mental health of people coping with the isolation. In cultures where this distinction between work life and leisure is hard to make to begin with, the expectation of being online all the time causes much stress. Agreeing on common times to do work and coordinating effective schedules become difficult as well when one takes individual contexts into consideration.

As it turns out, while some meetings could have been reduced to a simple email, making everything an email isn’t the solution either. Those work spaces that realized this were quick to hold online meetings, which are cumbersome due to connectivity issues, unfamiliarity with the technology, and other aspects that make time coordination difficult. Rather than “save” time and improve efficiency, time is lost. In countries where internet access is already unreliable due to storms and inclement weather, it adds another contextual layer of hardship, exacerbating an already tiresome situation.

Conclusion

That everything is going online from now on due to the pandemic is not to be taken for granted. In theory, many things should become easier for work life as a consequence. In practice, however, and most especially due to a continued lack of coordination, that certainly won’t be the case. 

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How to Join the Alt-Tech Exodus

01/22/2021Horea Christian

So, you've heard that big tech companies have transcended the niggling free market and reached the lofty heights of partisan politics --- and act accordingly. Unlike prominent political figures you might not make the top of the purge list, but it's no secret that censorship is surging. Both to protect your freedom, and to stop providing resources to those who would undermine it, it makes sense to jump ship. Now, when everybody else is also doing it. But how?

Freedom is a Skill

In the world of technology the reeds are tall, and you only get as much freedom as your choices afford you. The taint of political virtue signalling has sadly not left the liberty-minded untouched, and there's plenty of snake-oil salesmen looking for your business. So it's paramount to know how censorship can reliably be stymied.

Freedom by Design Beats Freedom by Convention

Have you heard of this-or-that new platform whose board has “a strong commitment to free speech”? Well, wouldn't you know it, so did “big tech” until there was power to be gained by doing the opposite. A more “virtuous” platform, or a partisan platform “from your side” will not sustainably support your liberty. A platform designed with freedom in mind will.

The Core Concept of Free Design Is Decentralization Over Centralization

There are two tiers for decentralized design. The first and highest standard is p2p (peer-to-peer), which connects users directly and relies on no centralized infrastructure. Sadly, not all content can feasibly be shared p2p (yet), so --- in a wonderful analogy to the offline world --- there is a second tier, federation. Federated services use a common protocol via which anybody can distribute content as long as they have the resources to maintain a server. Everybody could technically run their own server, but more often, a few hundred people maintain servers via which they make access to the protocol easily available to casual users. The emergent framework prevents influence (in the form of a large user base) from coagulating in one instance. Users can easily switch to a new provider (often keeping their data) and competition weeds out of abusive providers.

Tell me What to Use Already

No. The best I can do is share with you the choices I made and provide an example rationale in light of the common priority of sustainable free speech. Your choices might be different.

Text Messaging

Text messaging fortunately is very lightweight and p2p approaches are feasible. Tox is a protocol which allows you and all of your contacts to chat based solely on an open-source client which you can install on your device. There is no middleman who can censor you, no centralized server that can be taken down by malicious actors, and no one company which can go bankrupt or have a change of heart — regarding this whole free speech thing. Yes, it also supports video and audio chat.

The way this works:

You simply pick a client, install it, get an ID, share it with someone, and you're good. For ever.

Social Media

This is a bit more tricky, as the content requirements do not lend themselves to p2p. The biggest federated social network is known as the “fediverse”. You might never have heard of it, but you might have heard of software which uses the protocol (i.e. what an admin would run on his “instance”, i.e. his server), such as Pleroma or Mastodon. Alternatively, you might have heard of the biggest instance on the fediverse, Gab. That sadly doesn't cover it all, since the choice of an instance remains very important. To protect users from spam, or unwanted content (such as pornography) on their feed, the protocol allows instance administrators to block other instances, i.e. refuse to federate with them. While this fulfills the stated purpose, many admins also choose to block “problematic” instances. Instances generally publish a block list, though. You should check the “about” page of an instance you're considering either for a statement that they don't block any other instance, or to ascertain that the block list is compatible with your preferences. I am looking to host my own instance, but barring that, I am considering FSE and liberdon --- good free-speech instances which maintain no block list. You can also give an instance a try on a whim and switch later, though.

The way this works:

Find an instance you like (via web search), and register an account.

Video Content

Creators who have been banned or demonetized by YouTube have congregated around a host of alternative platforms. Most of these platforms, however, are simply imitations of the YouTube model, often with cryptocurrency tacked on for futuristic appeal. There exists however a federated video-sharing protocol, PeerTube. Much of what was said about the fediverse applies here as well, other than it being less common for PeerTube instances to federate with everybody. I enjoy using QOTO and there are even a few search engines which look up all instances for content (e.g. peertube-index and sepiasearch.

The way this works:

As a content consumer, you can use one of the aforementioned search engines to look for content you want to watch. No need to even register unless you want to keep track of favourites on somebody else's server. If so, you can use web search or this page to find interesting instances. Ideally, check how many instances they “follow” (more means access to more content) or how many total videos they give you access to (you can rank instances by either of these metrics here), and you're done.

Web Search

Believe it or not, but there is such a thing as p2p web search: YaCy. YaCy is fairly easy to run on your own personal computer, and does not require you to maintain a server. In a sort of combination between a p2p or federated model, you can run your own YaCy (which is the recommended approach), or use somebody else's in as far as they make it available (e.g. noisytoot). Your mileage may vary, and sadly it will never be as fast as centralized web search, though it could be similarly fast if you install it on your own computer and have a good internet connection.

The way this works:

You can just download and install YaCy, and you're set up to search the web on your own. There are very very many configuration options, but you don't have to use them.

Email

Email is already federated, as it turns out. This might also help you grasp the concept of federation. That the text following “@” differs from contact to contact, is a dead give-away for federation (social media accounts look similar on the fediverse). That most people still go for large-scale providers with questionable involvements in non-market processes, is simply a symptom of good marketing and herd mentality. Many email providers will offer you more censorship-robust services. I particularly enjoy smaller providers, as they tend to have low running costs and can actually finance the service fully through donations. Further, you can host your own email server, as I do.

The way this works:

If you are concerned about your current provider, you can simply run a web-search for alternative providers, the process is much the same.

Some of these options look daunting

Apathy and comfort are the enemies of freedom and very good bait to incentivize you to give it up. After all, that's how we got here. On a more gentle note, you don't have to go for all of the above, but if there is one particular service — such as social media or messaging — where you feel the cold breath of censorship down your back, it would be a good idea to give that a very serious try right now. None of these options require any particular expertise in technology, though, so it's rather a question of stepping out of your comfort zone than of studying anything at any great length. Not least of all, people are happy to help. Most of these technologies have support chats linked on their websites, and their support is considerably better than what you might have become used to from your current provider's help desk. Though it may not be overt of partisan, the spirit of freedom runs deep in the world of alt-tech, and people are more interested in empowering human action, than in corralling you into their service. Be wary of “alternatives” which behave otherwise.

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Don't Worry, "the Economists" Have Everything Under Control

01/22/2021Robert Aro

At Tuesday’s Senate confirmation hearing, former Fed Chair and President Biden’s pick as US Treasury Secretary, Janet Yellen claimed to have an appreciation for the nation’s debt burden, then proceeds to show she clearly doesn’t:

But right now, with interest rates at historic lows, the smartest thing we can do is act big. In the long run, I believe the benefits will far outweigh the costs…

This imprecise term, "act big," is apparently being used to describe economic ideas, mainly, how the government plans to spend $1.9 Trillion. It’s a statement devoid of any calculation, open to an infinite number of interpretations. When she says the benefits outweigh the cost, this claim cannot be substantiated. Unfortunately, we live in an era where few question the expertise of the “economic experts.” As Treasury Secretary, she will be in a tremendous position of power, making decisions on our behalf. It’s in our best interest to consider the rationale behind such “big” ideas.

Yellen expressed some of her rationale supporting the proposed spending bill:

I think there is a consensus now: without further action, we risk a longer, more painful recession now – and long-term scarring of the economy later.

Who are these economists? Where is this consensus? This was not the first time in the past week that “economists” were cited as supporting inflationist policies. Last Thursday’s speech, where the $1.9 Trillion spending plan was initially unveiled, Biden referred to “economists” five times!

Like Yellen, the appeal to a higher economic power is strong. The first of his references mirrored hers, saying:

We have to act and we have to act now. This is what economists are telling us…Our growing chorus of top economists agree that in this moment of crisis, with interest rates at historic lows, we can not afford inaction.

These economists are apparently in favor of borrowing trillions of dollars to fight against the pandemic, forced shutdowns, and a recession. The newly appointed President of the United States of America attempts to make the case for more debt compelling by telling us:

A growing number of top economists have shown, even our debt situation will be more stable, not less stable if we seize this moment with vision and purpose.

In what sounds like Fedspeak, supposedly taking on debt today will make our debt situation “more stable” in the future.

Finally, near the end of Biden’s speech, we are given an inkling as to who these economists could be that advocate spending trillions of dollars. He acknowledges it “does not come cheaply,” however, he urges that failure to act would be a much worse fate. After all:

The consensus among leading economists is we simply can not afford not to do what I’m proposing. Independent, respected institutions from around the world, from the Federal Reserve to the International Monetary Fund have underscored the urgency. Even Wall Street firms have reinforced the logic.

The “economists” providing this information remain unknown. Nevertheless, the Federal Reserve, the International Money Fund and Wall Street firms are said to be on board with the Biden/Yellen spending plan. Perhaps with good reason, as they tend to benefit handsomely from government stimulus bills, and they are paid for by society. As for those who don’t fall into those categories, that remains to be seen, since the threat of currency collapse and national bankruptcy continues to fall outside the purview of the Fed and the world’s leading economists.

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Trump's Potential Legacy: 50 Million+ Enemies of the State

01/22/2021Tho Bishop

Well, they finally got Donald Trump. But he sure scared the bejesus out of them. It took a massive five-year campaign of hysteria, of fear and hate, orchestrated by all wings of the Ruling Elite, from the respectable right to the activist left. The irony, of course, is that the last actions of Trump’s presidency highlighted how little of a threat he, as an individual, truly was to the deep corruption in America’s government. Lil Wayne may be free, but figures like Julian Assange, Edward Snowden, and Ross Ulbricht are not. The Fed’s big fat bubble has only gotten larger as Wall Street has thrived, while American workers continue to be "discriminated against."

If historians look back at simply the Trump administration’s policy legacy, the controversial nature of his tenure may confuse. A record of tax cuts, deregulation, runaway spending, an Israeli-Saudi-focused Middle East policy, criminal justice reform, and stacking the federal court with conservative judges on paper seems firmly aligned with the Republican Party of the modern era. Compromises on gun issues, the inability to replace Obamacare—or even reject its core tenets. His calls for larger stimulus relief would perhaps lead some to believe that he was relatively moderate in the current environment.

Looking back, Trump’s most radical act of governance may be his simple embrace of federalism in the face of the coronavirus. Whether this stemmed from a genuine belief in the limits of practical federal power or a desire to have the flexibility to blame governors if a state’s response became unpopular, the administration’s willingness to allow states to take the leading role in devising a policy response allowed for one of the greatest illustrations of the importance of political centralization in recent American history. Trump allowed Florida to be Florida and New York to be New York. The ability to compare state performance has been essential at a time when "medical experts" were being weaponized in support of covid tyranny.

All of this, however, would miss the true significance of the last four years. Trump’s legacy will be that of a political leader who, at a time when American politics was still adjusting to social media and user-created content, leaned into the polarization of American politics rather than pay lip service to "national unity." A critic would claim this comes from Trump’s unquenchable need to have his ego stoked. A supporter would see a man who understood the need to realign American politics—but the underlying motivations are irrelevant.

Trump’s impact on American politics may result in an even greater impact on the US government than his collaboration with Mitch McConnell on the judiciary.

A variety of polling indicates that as Donald Trump boarded Marine One to retreat to Mar-a-Lago, he does so with most of his voters believing he is the rightful president of the United States. One poll showed almost 80 percent of Republicans "do not trust the results of the 2020 presidential election." If we estimate that 75 percent of all of Trump’s 2020 voters hold this view, that leaves us with over 50 million Americans who believe they now live under an illegitimate federal government.

This reality terrifies Washington’s political class more than anything Donald Trump could have done while occupying the White House.

As Murray Rothbard illustrated in Anatomy of the State, "What the State fears above all, of course, is any fundamental threat to its own power and its own existence." A vital part of the state’s existence is its ability to justify its action with a mantle of "legitimacy"—which in an age of democracy comes from the notion of the "consent of the governed."

The result of 50+ million Americans viewing the next president as a fraud imposed on the people is an inauguration taking place in a Washington, DC, that resembles a warzone, surrounded by soldiers whom the regime does not trust with their own ammo.

The downside of America’s regime acting from a place of fear is that it is likely to ruthlessly lash out like most violent predators tend to do. Since the actions at the Capitol on January 6, the corporate press has elevated a collection of "terrorism experts" who have explicitly called for the tools formed in the war on terror to be turned inward to deal with the growing Trump "insurrectionist threat."

As Glenn Greenwald notes, "No speculation is needed. Those who wield power are demanding it."

The upside is that the tremendous growth of federal powers has always been dependent upon the public’s understanding that such power was being wielded in their own defense. Therefore, democracy has, rather than being a public check against tyranny, more often been a way of peacefully empowering officials to get away with abuses that autocrats could only manage with explicit violence.

To quote Rothbard:

As Bertrand de Jouvenel has sagely pointed out, through the centuries men have formed concepts designed to check and limit the exercise of State rule; and, one after another, the State, using its intellectual allies, has been able to transform these concepts into intellectual rubber stamps of legitimacy and virtue to attach to its decrees and actions. Originally, in Western Europe, the concept of divine sovereignty held that the kings may rule only according to divine law; the kings turned the concept into a rubber stamp of divine approval for any of the kings’ actions. The concept of parliamentary democracy began as a popular check upon absolute monarchical rule; it ended with parliament being the essential part of the State and its every act totally sovereign.

As such, even if aggressive actions by the Biden administration to address the specter of a Trump-inspired insurrection have the explicit support of nominally Republican leaders such as Mitch McConnell or Kevin McCarthy, how would such action be seen by MAGA America? If forced to choose, would someone like Governor Ron DeSantis align himself with a "bipartisan" effort from Washington elites or choose to be a leader of Biden-era resistance? Even if the resistance to a Biden administration is not ideologically libertarian or fundamentally "antistate," an explicit rejection of federal domination would be a vital first step toward the sort of political decentralization and self-governance that any peaceful political order ultimately requires.

Of course, all of this assumes that Trump’s base remains loyal—or at least remains hostile to the new regime. If Biden governs the same way he campaigned, by largely staying out of sight and avoiding making any bold statements and commitments one way or another, perhaps the public can be once again pacified and partisan divisions reduced to largely superficial differences, as has been the case for much of the current era.

If, however, the Biden administration governs more like the corporate press and blue Twitter wants him to—waging war on gender roles, prioritizing transgender issuespushing for job-killing economic policy during a pandemic, acting unilaterally on immigration, penalizing gun owners, "reeducating" Trump supporters, treating MAGA like Al Qaeda, etc.—then the divides between Trump’s America and Biden’s America could become only further entrenched. And that is not even factoring in what happens if America experiences the hardship of an economic crisis.

Trump’s legacy will not be shaped by his actions—or even by how his enemies portray him. Ultimately, it comes down to his base and the movement he inspired. As Lew Rockwell noted in a recent interview with Buck Johnson, "The Jeffersonians were much better than Jefferson. The Taftians were much better than Robert Taft. The Trumpians tend to be much better than Trump."

Should skepticism of the 2020 election, fueled by a new administration's actions, finally convince 50+ million Trump supporters that the barbarians in the Beltway do not represent them and to react accordingly, then Trump’s presidency will be—despite his own actions—the disruption that America’s elites truly feared.

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With Trump out of the Way, Suddenly We're Hearing Good News about Covid

01/21/2021Ryan McMaken

With Donald Trump safely out of the way, it is now safe for politicians and their friends in the media to begin scaling back their panicked hysteria over covid-19.

For example, last week the Democratic mayor of Chicago, Lori Lightfoot, suddenly had a change of heart on the city’s forced lockdowns and announced she’ll work to scale back the state’s covid-19 mandates. The local CBS affiliate reports:

Thursday morning, Lightfoot said she plans to have a conversation with Gov. JB Pritzker about how to begin rolling back virus mitigation efforts ASAP.

“I want to get our restaurants and bars reopened as quickly as possible,” she said.

Meanwhile, in Colorado, the governor announced a few hours before Biden was inaugurated that he was shutting down the state’s never-used emergency hospital. The local Fox affiliate reports:

The Colorado Division of Homeland Security and Emergency Management announced Tuesday evening that the Colorado Convention Center in downtown Denver will be decommissioned as an alternative care site for COVID-19 patients.

A spokesperson for the division confirms the Convention Center never housed any patients.

The Convention Center was prepared to house up to 2,200 patients if hospitals could not handle the demand. The conversion into a makeshift hospital was made in April 2020.

For months, the state’s governor, Jared Polis, insisted that the overflow hospital had to be maintained and that an enormous surge in cases could happen at any time. But then, at virtually the same time Biden was inaugurated, Polis announced these precautions weren’t needed anymore.

Meanwhile, the governor of Massachusetts (a Republican critic of Donald Trump) announced today that he “would begin lifting some coronavirus restrictions” including the stay-at-home advisory and the 9:30 p.m. curfew.

Keep in mind that the regular flu season doesn't peak until March, which means we ought to still be hearing about how we must fear the "twindemic" and how we still have a long, hard winter ahead of us. At least, that's what we were still hearing in December. But now, suddenly, with at least two months of the peak-mortality period to go, we're hearing that everything is headed in the right direction. It could all be a coincidence, but I remain skeptical. 

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A Host of New Programs and Regulations Coming from the Biden Administration

01/20/2021Robert Aro

It’s called the American Rescue Plan! By now everyone has heard about the $1.9 trillion bill which includes a $15 national minimum wage and $1,400 stimulus checks. CNN captures the essence of the rescue package quite well:

Bigger stimulus checks. More aid for the unemployed, the hungry and those facing eviction. Additional support for small businesses, states and local governments. Increased funding for vaccinations and testing.

There’s a lot in the plan, yet it amounts to nothing more than the government allocating resources on our behalf. It requires either central planning for millions of businesses, as is the case with the minimum wage, or giving money to certain people or sectors in society, as we see with stimulus checks. Very few people in charge appear concerned about the rising debt and money supply these actions create. 

Start with the idea of the government setting a national minimum wage. When this happens, it forces the entrepreneur to make a decision: they must either choose to do nothing and accept a lower profit margin and/or inevitable bankruptcy, or make changes to increase profitability. This may include cutting staff or raising prices with the hope consumers will accept the higher prices. It is the instance of “raising prices,” we should take note of.

In 2021, consider who should take credit if the Fed reaches or overshoots its desired price inflation target. How can anyone tell whether it was the result of the Fed’s actions (such as low interest rates) or if it was due to the government’s action of increasing minimum wage laws? Those are just two reasons why prices change, but there are actually countless. The Fed cannot reasonably say they are managing price inflation. They have no idea what actions have contributed to the rise of prices of goods or services.

The other economic fallacy is the idea that money creation will alleviate financial hardship. We saw Trump give $600 last month and Biden wants to give $1,400 this month. This is supposed to help “the hungry,” those in need, etc. Yet very few people have addressed how this adds to the national debt level, debases the US dollar, makes life less affordable for the masses and ultimately makes them poorer. “The poor,” much like the nation itself, will continually require greater amounts of debt to survive. This vicious cycle seems to be of little concern to our planners.

As for how the $1,400 was decided instead of doubling it to $2,800 for twice the potency, no one has explained why. However, we do know where this money comes from. Given that in fiscal year 2020 the US treasury received only $3.42 trillion in tax revenue but spent over $6.5 trillion, it’s apparent the money is not in the Treasury's bank account. Since the money is not with the Treasury, and tax dollars are not enough to cover government spending, the only place left is the debt market.

Many will still lend to the US government. But the issue is at what cost? If the Fed was not going to buy a substantial amount of debt, price discovery would occur and interest rates on US debt would rise. As of today, and for the foreseeable future, this is not the world we live in; as CNBC cited Jerome Powell on Thursday:

The Fed’s benchmark short-term borrowing rate is anchored near zero and it is continuing to buy at least $120 billion in bonds each month.

If the American Rescue Plan is a sign of things to come, we’ll soon learn a lot more about the effects of national minimum wage laws, continuous stimulus checks, government debt, and perpetual increases to the money supply. And this is just the beginning.

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Why They Hate Trump So Deeply

Listen to the Audio Mises Wire version of this article.

In the words of Ronald Reagan, here we go again. The unbelievable hatred that Democrats, liberals, progressives, and the mainstream press have toward President Trump continues to consume them, with the latest manifestation being a second impeachment of President Trump, just a few days before he leaves office.

Isn’t the purpose of an impeachment to remove a public official from power? Trump is out of power on January 20. The impeachment trial won’t even be held until after January 20. What’s the point?

I’ll tell you the point: hatred—deep, unfathomable, all-consuming hatred for Donald Trump.

After all, if Trump committed a criminal offense by “inciting” an insurrection, a rebellion, a revolution, or a Reichstag fire, as his detractors are claiming, there is a remedy for that: a criminal prosecution. The Justice Department under President Biden could secure a criminal indictment against Trump the day he leaves office or afterward.

So, why go the impeachment route?

One big reason is the hope that if they can convict Trump, they can then go one critically important step further by voting to disqualify him from ever running for public office again, especially for the presidency.

Trump, of course, has suggested that he might run again in 2024. He already has many millions of dollars in the bank to finance another run. The last thing the Democrats and the mainstream press want is to have Trump back on the campaign trail spouting “End the steal by electing me again.” Given their obvious aim to forever bury any reference to the possibility of fraud in the 2020 election, including by censoring people or simply labeling them as traitors, to have Trump running again spouting off about a fraudulent election would be their worst nightmare. An impeachment conviction followed by a disqualification vote would end that threat.

What is it about Trump that has engendered so much deep hatred and rage among the Left?

After all, from a libertarian standpoint, Trump’s term has been an absolute disaster. His Berlin Wall along the border, which he promised would be paid for by Mexico but that was actually financed illegally through the use of a Pentagon slush fund. His destructive trade war with China. His continuation of the Pentagon’s and CIA’s forever wars that he promised to end. His deadly and destructive sanctions against Iran. His stoking of a crisis with North Korea, only to fall in love with a Communist dictator. And much more that go against the principles of libertarianism.

Yet, despite all of Trump’s antilibertarian actions, there is no deep visceral hatred among libertarians for the man, as there is among people of the Left. In fact, some libertarians even like or respect the guy.

Why is it so different for those on the left?

After all, it’s not as though there are philosophical differences. Both the Left and the Right, including Trump, favor things like Social Security, Medicare, Medicaid, welfare, the welfare state, farm subsidies, trade restrictions, the Federal Reserve, income taxation, the Pentagon, the CIA, the NSA, the FBI, foreign bases, foreign interventionism, coups, alliances with dictators, foreign aid, the drug wars, and much more socialism, interventionism, regulation, militarism, and empire.

And it’s not like the hatred began with the recent Capitol melee. It actually stretches all the way back to the very beginning of Trump’s administration, when the hatred so consumed the Left and the mainstream press that they spent the first two years convincing themselves, falsely, that Trump was a covert Russian agent, one whose assignment was to deliver America into the clutches of the nation’s Cold War rival. When that investigation went nowhere, it was followed by Impeachment I, which also went nowhere.

Consider Impeachment II. It provides another good example of the deep hatred that absolutely consumes these people. How much time and deliberation went into that vote? Answer: none. It was done immediately, without the careful consideration that should always go into such an important decision.

Blinded by their deep hatred of Trump, the Left and the mainstream press would respond, “What is there to deliberate? It’s clear that Trump is guilty of inciting an insurrection.”

Oh, but it is far from clear. In fact, some legal commentators are saying that Trump’s actual words and the timing of his words do not constitute “incitement” under the law. (See here and here.)

Moreover, it’s not at all clear that what happened at the Capitol was an “insurrection” or “rebellion” or a “revolution” or a “coup” or a “Reichstag fire.” It might actually have been nothing more than a peaceful protest gone awry, as protests and demonstrations sometimes do.

Regardless, if Trump himself didn’t do anything illegal, then why should he be impeached? Is the impeachment process to be used to remove a president simply because he is hated by the opposing party or because they disagree with his words or policies?

Indeed, as a libertarian I’d ask why mere words should ever be used to convict a person for “inciting” another person to act. Don’t people have free will? Those Capitol protestors were not automatons or even military personnel. They were perfectly able to say no to anyone who “incited” them to engage in illegal conduct. Why should a person who “incites” illegal conduct with mere words but doesn’t actually participate in the illegal conduct be liable for criminal behavior willingly committed by others?

But here’s the point: Why shouldn’t these issues have been carefully discussed and deliberated prior to the impeachment vote? Why weren’t there constitutional and legal scholars summoned to testify as part of the impeachment decision to give their legal opinions on whether Trump has done anything to merit removal from office?

Answer: because deep hatred causes people to act in impulsive and irrational ways.

Would you like to know the real reason for the deep, unfathomable, uncontrollable hatred and rage that these people have for Donald Trump?

I’ll tell you what it is.

It is acceptable practice for any politician and bureaucrat to criticize things that happen within the Washington, DC, sandbox in which these people play. But woe to the politician or bureaucrat who challenges the sandbox itself. He is toast.

No president since John Kennedy has dared to do that. Kennedy did it, especially in his famous Peace Speech at American University five months before he was assassinated. He said that the Cold War was a crock and that he was calling an end to it, which, needless to say, constituted a grave threat to the sandbox in which the national-security establishment had been playing and hoped to continue playing for the indefinite future.

We all know what happened to Kennedy, or at least those of us who are not afraid to examine and challenge the dark inner workings of the national security state sandbox. No president since Kennedy has dared to do that…until Donald Trump came along.

No matter his faults and failures and poor policy decisions, there is one indisputable fact about Donald Trump: He is not like the rest of the Republican and Democrat politicians or their followers and supporters in the mainstream press. During his campaign, he called them out all. He challenged their sandbox or, if you will, their swamp. He appeared to be willing to take on the military and its forever wars as well as the intelligence community and its nefarious, dark-side activities. He garnered lots of support and votes for that stance.

That’s why they hate him. No politician or bureaucrat is supposed to do that. And certainly no president is supposed to do that. Trump was a threat to their established order. He had to be smashed. He has to be terminated. That’s why they are trying desperately to ensure that he departs the political scene and is never permitted to return.

Oh sure, it’s true that for some unknown reason Trump ended up caving to the national security establishment. Early on, he surrounded himself with generals and warmongers and decided to continue their forever wars. He also surrendered to the CIA’s demands to keep its fifty-year-old JFK assassination records secret on the false claim that their disclosure would threaten “national security.”

Nonetheless, the die had been cast. Trump had committed the mortal sin of any national-security state—he had questioned the system itself. He had to go. They have to send a message that this type of thing will never be permitted again.

Reprinted from the Future of Freedom Foundation.

Image source:
Tupinicomics via Flickr
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Understanding the Action Axiom

The action axiom can be stated as follows (Cf. Rothbard [1962, 1970] 2004, pp. 1–2, 7–8, 19–20; Rothbard, 2011, pp. 113, 290; Mises, [1949] 1998, pp. 14–16): “Human beings engage in purposive behavior—i.e., they choose which scarce means are to be more fruitfully (or economically, or rationally) employed in order to satisfy their most preferred ends. This behavior—stemming from human free will—is what we call action. As long as means are scarce and wants are not fully satisfied, human beings will keep on intentionally (or purposefully) acting.”

Why is this an axiom? Because you cannot disprove it without either conceding its truth or incurring a self-contradiction (Cf. Rothbard 2011, pp. 6, 10; Rothbard [1982] 2002, p. 32 and 32n6). In fact, anyone trying to disprove the action axiom would indeed engage in purposive behavior—i.e., he would be employing scarce means (his time, his intellectual labor, etc.) in order to achieve a preferred end (trying to disprove the action axiom instead of, say, watching TV or reading Rothbard). Therefore, the action axiom denier would either contradict himself—claiming the untruth of a statement he is instead performatively proving to be true—or be forced to concede the truth of the axiom itself—because otherwise he could not maintain to be acting in the sense we defined above.

The Action Axiom and “Microeconomics”

Generally, microeconomics textbooks frame the main tenets of consumer (and, analogously, producer) theory as follows: “Consumers are supposed to be rational—i.e., they employ scarce means to attain desired ends. Moreover, consumers’ preferences are assumed to feature (at least) the following properties: completeness, transitivity, and non-satiation.” 

As I will briefly explain, it is very easy to derive these properties from the action axiom itself. There are many other properties of human behavior that we could derive from this axiom—such as, e.g., time preferences, the law of diminishing marginal utility, and the law of optimum returns—but those will not be examined here.

First, consider “completeness”—i.e., human beings’ capability of always ranking alternative ends. Since action requires having preferred ends, it also entails that human beings will act if and only if they indeed have ends they want to achieve—i.e., they are willing to act in order to substitute a state of the world with a more desired one. In other words, were human beings not always capable of deciding between at least two possible ends and ranking them (e.g., B is preferred to A, or vice versa), they simply could not act (Cf. Rothbard 2011, pp. 305–07). But, as we saw above, action is an axiomatic truth of human nature—we cannot conceive of nonacting human beings. Therefore, action itself implies complete preferences—i.e., human beings need to be always capable of ranking the various potential states of the world (A, B, C, etc.) they can attain while engaging in action.

Second, consider “transitivity”—i.e., if I prefer A over B and B over C, then I must also prefer A over C. Again, it is straightforward that absent transitivity human beings would not be capable of conclusively ranking preferences—hence, they would not have precisely definable desired ends to struggle for. Consider, for instance, the simplest possible case: Fabrizio is faced with the possibility of employing some means (say, one hour of his labor) in order to attain one among three alternative ends—A, B, and C. However, suppose also that he prefers A to B, B to C, and then C to A; the question now arises: How could he act? In fact, it is obvious that he would face a paradox—not being able to decide which end is to be pursued and which ones are to be foregone. Again, this proves that transitivity is directly—and easily—derived from the action axiom: men with nontransitive preferences would not be able to act—but this would contradict their nature as human beings!

Third, consider nonsatiation. Here, suffice it to say that “a man perfectly content with the state of his affairs [i.e., satiated] would have…neither wishes nor desires; he would be perfectly happy. He would not act; he would simply live free from care” (Mises [1949] 1998, p. 13). Again, denying nonsatiation of preferences would be tantamount to denying the acting nature of human beings. Thus, we proved again (via reductio ad absurdum) that nonsatiation is consistently derived from a true axiom—and must thus be itself true.

There are two other properties that conventional microeconomics textbooks ascribe to economic agents’ preferences—namely, continuity and convexity (i.e., consumers are assumed to love goods’ variety). Suffice it to say that while convexity can be postulated (but need not be, since it is not directly derived from the action axiom), the assumption of continuity is simply wrong—because human action does always involve choices among discrete, noncontinuous units (pounds of bread, gallons of milk, haircuts per year, etc.) (Cf. Rothbard [1962, 1970] 2004, pp. 130n27, 305–07).

The Action Axiom and Ethics

If the fundamental feature of human nature is that human beings act, then what does this (a priori) truth imply for other branches of human sciences? Take, for instance, the task of building a rational (i.e., a priori true) ethics of human liberty.

Starting from the action axiom, we can, for instance, build a rational and cogent argument for human beings’ natural and absolute self-ownership—i.e., any human being shall be the sole owner of his body, his labor, and his mind (namely, his choices, his values, his free will, etc.). In fact, let’s assume the simplest possible case: there are two persons—A and B. Now, there are three possible arrangements (Cf. Rothbard 2011, pp. 353–54).

First, we can assume that A is the owner of B (or vice versa). However, if A is the owner of B, then B is A’s slave—and slaves, by definition, are not free to act as they will. But if B is no longer capable of free-willed action, then he would no longer be a human being as we defined this concept (i.e., acting man) above. But this would imply a paradox—B being a human being in our hypothesis but no longer being one in our conclusion. Hence, this first arrangement is to be discarded as self-contradictory.

Second, we can assume that A owns a share of himself and a share of B (and vice versa). However, this would entail that A cannot act without B’s approval (and vice versa). But, for B to approve A’s action, B is required to purposefully cast a vote approving such an action (and vice versa). But then we reach again a paradox: A cannot act without B’s consent, but B’s consent is itself an action requiring A’s approval, but A’s approval is itself an action requiring B’s consent, et cetera—an infinite regress. But if both A and B’s action is stalled, then neither A nor B can act—and, if they cannot act, they are at odds with their nature as human beings (i.e., acting men). Hence, again, this second arrangement is to be discarded as paradoxical.

Lastly, we are left with the third option, the only consistent—i.e., noncontradictory—solution to our problem of human beings’ ownership: both A and B are to be self-owners. No other arrangement is compatible with human nature—i.e., action as deliberate choices employing scarce means in order to achieve preferred ends.

Conclusion

Economics has conspicuously departed from its Mengerian-Misesian-Rothbardian framework as a purely deductive science. By doing so, mainstream economists have forgotten the epistemological groundwork of economics, abandoning proper praxeological analysis, neglecting the apodictical (a priori) truths of praxeology, and imitating empirical (a posteriori) sciences. In the end, this departure from the Mengerian-Misesian-Rothbardian framework has proved detrimental for (at least) two reasons.

First, it prompted mainstream economists to justify their assumptions as “operational” (or “heuristic”) hypotheses—like empirical scientists do—instead of acknowledging the a priori truth of praxeological tenets. Second, it undermined sound and rational analysis even in other branches of human sciences—such as ethics—thus leaving intellectual room for moral relativism, postmodernism, and collectivistic ideologies.

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Currency Competition May Save the Economy or Even Much More

01/19/2021Gavin Wax

A fifth of all US dollars ever created are just under one year old. In about the same time, bitcoin has quadrupled in value. Currency competition is here, but the blessing for consumers is seen as a serious threat by the oligarchical elite.

Just as our country is reaching a cultural and political crossroads, so too is there an economic rubicon to be crossed. Beyond any other social issue, however, Americans must take a greater interest in their money.

The reason is simply that fiat money systems have always ended up in the dustbin of history. Too often, it’s the same result for a civilization’s freedom and prosperity, even its claim to self-determination. What’s truly frightening is that the whole global economy is now under such a system of fiat, with the US dollar as the world’s reserve currency.

No one can precisely predict the future, but based on what occurred in 2020, the reign of the US dollar as the world’s reserve currency may not be long for this world.

Central banks and other behemoths of government and business have an interest in making any monetary transition as smooth as possible for themselves while also maintaining or increasing their current influence on markets. The solution is likely to be a central bank digital currency, known as a CBDC, portending a cashless future.

Thankfully, there are more free market-oriented innovations that serve the average American consumer’s best interests. Those would hedge against inflation, keep their purchasing power and storage of value long term, and also allow at least some privacy protection against traceability.

The most obvious recent example of the latter is bitcoin, which is not a fiat currency, meaning it is not decreed into existence by government or central bank officials. The cryptocurrency broke a new value record of $42,000 on January 8. Its rise over the last decade reflects deep concerns for the US dollar’s fate.

“Bitcoin definitely created a revolution,” said Daniela Cambone, editor at large and anchor with Stansberry Research, on a recent episode of the Ron Paul Liberty Report. “It is a protest against the US dollar and other currencies.”

“It is giving power back to the people,” Cambone added before noting that the covid-19 lockdowns have “caused a lot of people to have more time to reflect about their money.”

Now, Cambone is no bitcoin booster. She is unsure of its long-term value. However, the undeniable point is that bitcoin is becoming a perceived safe haven for value storage, at least in the short term.

That’s not thanks to any monetary dictator or board of expert economists. It’s a result of free and voluntary exchanges. That process should not only be allowed to continue, but should be further expanded into a truly unhampered market for currency competition.

When he was a congressman, Dr. Ron Paul introduced legislation to legalize currency competition. Paul sought the repeal of legal tender laws, which codify powers not authorized by the Constitution in the first place. His bill also called for a repeal of prohibitions on private mints and laws imposing capital gains and sales taxes on coins.

The last such law proposed was the Free Competition in Currency Act of 2013, introduced by former Representative Paul Broun (R-GA). Hopefully another version of this bill emerges soon; the new Sound Money Caucus, led by Representative Warren Davidson (R-OH), was announced this past summer.

How urgent is this issue for Americans? Well, how stable does the country feel at the moment? In times of uncertainty or even great crisis, money alternatives are essential for many kinds of transactions, especially for politically marginal or oppressed groups.

Take a moment to review human rights activist Alex Gladstein’s Twitter thread documenting more than a dozen situations worldwide where Bitcoin is used to get around arbitrary government obstacles.

Americans are increasingly aware of the control over free speech online, and soon they may also learn of widespread denial of services such as payment processing for anyone deemed too politically incorrect. To protect against that, currency competition should be encouraged.

The takeaway here is not that bitcoin or silver or gold are destined to replace the dollar. They may or may not. No matter what, it should never be illegal to do honest business in America, even if that means a transaction isn’t denominated in US dollars.

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What Defund the Police Gets Right

01/18/2021Andrew Cowley

For all the hullabaloo that surrounds the “Defund the Police” movement, we forget that our fellow citizens have legitimate concerns that must be openly and honestly discussed. Although the defund the police movement is surrounded by controversy, libertarians, conservatives, and liberals alike can find common ground in the sort of law enforcement that is required for a safe and secure neighborhood.

Those who embrace individual freedom and liberty should take the defund the police movement seriously. The driving force behind defunding the police is the thirst to govern our communities, and ourselves, without government coercion. If we defund the police, it must follow that communities are empowered to “police” their own neighborhoods as they see fit. Without government-sponsored police, law enforcement is privatized. And this is a good thing!

Libertarians hold the political philosophy that an individual needs to be recognized as such. Rights can only be applied to the individual, not to a group of individuals. The most supreme right of them all is the guarantee that personal property and individual freedom are never violated, without exception. This means that the rights to life, liberty, and the pursuit of happiness are not just ideals we strive for but actual rights that each individual person has been born with. These rights are not granted, given, or awarded to anyone by anyone. Instead, these rights are inherent in man’s existence and cannot be infringed upon by anyone or anything. The government is not exempt from this truth. No government, or individual, can violate the inherent right each person has to life, liberty, and the pursuit of happiness. Policing our communities is no different.

It is widely accepted that law enforcement is the responsibility of government. However, we must recognize that each community requires a different approach to policing. When considering population size, community diversity, resources available, etc., we can see that the law enforcement needs of places like New York City will necessitate a different approach from the one for Coeur d’Alene, Idaho—no matter how small the nuance. It is hard to deny that each specific community requires a unique approach.

Although the general theory of American individual liberty is recognized as good—life, liberty, and the pursuit of happiness—it is difficult to apply this theory to real-world circumstance. This is why the defund the police movement mistakenly conjoins two contradictory goals: (1) the freedom to police for communities to police themselves as they see fit, and (2) a heavy-handed government to make sure that happens.

The freedom to do what is best for your individual circumstance and a strong authority figure to enforce compliance cannot coexist. Unavoidably, the right to police the community you live in as you see fit will clash with some strong authority figure who wants to decide for you what they think the right way to police is. The ideal of people choosing what’s best for themselves becomes others deciding what’s best for them.

There are as many different opinions about what good policing looks like as there are politicians who lie—we couldn’t begin to count that high, even if we tried! The premise is correct—we must overhaul what policing looks like in practice—but the conclusion is wrong. Replacing one authority figure with another in order to rectify policing issues will not solve the problem.

Surely, the most ardent propolice individual must admit that a community where people feel safe is the prime goal, whether that is achieved through traditional policing or not. If we can offer people a safe community, is it important if that safety is achieved through a private company? Are we to believe that a community would reject a safe neighborhood merely because that safety was provided by a private company, rather than the government? I think not!

The defund the police movement makes a poignant case against the current system of policing and community involvement by the government. By uniting behind the cause of privatizing the police, we will make strides toward a safer and more respectful community.

History has shown that government will prioritize revenue and power over the safety of citizens. Enforcing arbitrary laws (like parking tickets) to generate revenue from fines, government funds bloated pensions and expands union control—and the safety and well-being of citizens takes a back seat. We can see this reality playing out in cities like Chicago, Baltimore, and Detroit. In Baltimore, government spending on police is more than half a billion dollars per year. Such a massive amount of money expended in the name of safety has produced one of the most dangerous cities in the United States.

There is a real, undeniable problem in minority neighborhoods—drugs, violence, and theft—and we must face that problem. The belief that the system (i.e., the police, government, capitalism, etc.) unfairly treats minorities (skin color, sexual preference, sexual identity, etc.) is a mainstay in modern culture and cannot be ignored. There is a prevailing belief that systemic racism has forced minority groups into a life of crime. Because government has a monopoly on law enforcement, there can be no solution that does not include cartel-like control without tearing down the entire system. This is why groups like Black Lives Matter believe that defunding the police is not a mere catchphrase—it is a call to reimagine the “system” in its entirety.

Although some state and local governments have agreed to “cut” law enforcement spending, calls for defunding the police have persisted. Appeals for compromise will go unheard. And this is a good thing!

Defunding the police and revamping law enforcement are legitimate goals that need to be addressed. Libertarians, conservatives, Republicans, and all other members of society should strive to recognize this ubiquitous issue.

The message of “defunding” the police is correct, even if the conclusion on how to fix bad community policing is not. It is true that government-sponsored policing has been, and is, destructive to some communities. We see this destruction nightly on our news channels. Elected officials have used law enforcement for their own protection, rather than for the protection of their constituents. Chicago mayor Lori Lightfoot used police as a personal protection service for her home as buildings burned and protestors looted stores nearby. Politicians claim gun laws are our way to salvation as they are escorted by an armed cadre of bodyguards. The police have been enlisted as a political tool rather than for public safety. It is hypocrisy at its finest!

Without government monopoly on law enforcement, no such abuse by politicians can exist. Why? Because paying customers are given preference, regardless of political standing.

The premise that a community has the right to decide how best to protect their neighborhood is a by-product of individual freedom. The defund the police movement is right: the government should have no say about how to police a neighborhood if that neighborhood doesn’t want the protection the government is offering. Forcing a community to accept whatever solution the government proposes has resulted in distrust of law enforcement personnel, runaway government spending, and the militarization of the police.

The conclusion the defund the police movement has come to—replace one government-controlled police force with another—is unfitting. The answer to creating a safer, more inclusive community is not through more government oversight and political heavy handedness. No! The answer is for the people to establish what works best for them in their individual circumstance. This is accomplished by privatizing law enforcement.

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