Power & Market

Two Problems with the Nonaggression Principle

03/04/2021Scott Sehon

Libertarians typically favor reducing government to a minimal or night-watchman state, one limited to police, courts, and national defense. (For example, the Libertarian Party platform says that “the protection of individual rights is the only proper purpose of government.”) Some libertarians argue for this minimal state by appealing to the nonaggression principle. This is a mistake.

The nonaggression principle (NAP) prohibits initiatory force. Adapting a formulation by philosopher Roderick Long, it can be cast as follows:

NAP: Any act of forcible interference (or threat thereof) with another individual’s person or property is a violation of rights, unless the act is a response to forcible interference (or threat thereof) by that person.

I will argue that the NAP has unacceptable consequences. We can modify the principle to avoid those consequences, but this comes at a severe cost: the principle will then no longer do any real work in the argument for the minimal state.

First Problem for NAP: Past Injustices

Suppose I steal a priceless painting from you and then give it to Bob, a friend of mine. Even if Bob knows the painting was stolen, he did not use or threaten force. According to the NAP, this means that forcing Bob to give the painting back would be a violation of his rights. Putting this point more generally: the NAP prevents rectification of past crimes or injustices, so long as the original criminal has transferred the proceeds of his iniquity to someone else.

We could avoid this unpalatable consequence by revising the NAP:

NAP: any act of forcible interference (or threat thereof) with another individual’s person or legitimately acquired property is a violation of rights, unless the act is a response to forcible interference (or threat thereof) by that person.

The libertarian could then claim that Bob did not legitimately acquire the painting, since it was stolen; thus we are allowed to use forcible interference to get it back.

However, adding “legitimately acquired” to the NAP opens up a huge can of worms. Which properties count as legitimately acquired? A stringent, Nozick-inspired answer to that question: my property was legitimately acquired if I got it through a sequence of transfers each of which was free and uncoerced, and where this sequence goes back to an original acquisition of property that was just and fair.

Even if we suppose, rather improbably, that there was a just initial acquisition of property, it beggars belief to claim that the current distribution resulted from a sequence of free and uncoerced transfers through the subsequent centuries. To see this, we need merely point out that the distribution of wealth in the United States was hugely affected by the slavery and blatant oppression of black Americans, not to mention the slaughter of Native Americans and theft of the land they occupied in the early days of the republic.

On the stringent view of legitimate acquisition, even a democratic socialist who wants a big welfare state could simply agree with the NAP: the socialist will just add that, since almost no currently owned property was legitimately acquired, and since the NAP only applies to legitimately acquired property, the NAP imposes no real restrictions.

Perhaps libertarians can come up with a less stringent theory of the legitimate acquisition of property. Perhaps, as suggested by David Gordon in a related context, the notion of convention will play a role. Perhaps this theory, when added to the NAP, will imply that most acts of initiatory force are still forbidden; and, finally, perhaps this can in turn be used to argue that only the minimal night-watchman state is justifiable. 

But observe: even with such a theory in place, the dispute between the libertarian and the socialist would then have nothing to do with the revised NAP, which they can both accept. The NAP, which was originally put forward as the basis for the libertarian position, no longer plays any role in the argument. All the real work would be done by the yet-to-be-provided ancillary theory about what counts as legitimately acquired property. (Sandy Ikeda made a related point about the NAP.)

Second Problem for NAP: Taxation

When the government sends me a tax bill, it comes with a threat: they can garnish my wages or even throw me in jail. This threat is not in response to any act of forcible interference on my part; I was just sitting here not paying taxes. But this implies that the tax bill is, according to NAP, a violation of my rights.

However, if taxes themselves are a violation of rights, then even the minimal state is forbidden, insofar as the minimal state funds courts, law enforcement, and national defense by levying taxes.

Some libertarians might accept this and conclude that even the minimal state is too much state. These libertarians, like the 2020 vice presidential candidate Spike Cohen, may become anarchists.

But this goes beyond what most libertarians advocate. The Libertarian Party platform calls for extremely limited government but does not demand the end of compulsory taxation. Similarly, Libertarian presidential candidate Jo Jorgensen advocated eliminating the federal income tax but did not suggest getting rid of all taxes.

Libertarians might try to avoid the anarchist suggestions of NAP by modifying the principle so as to allow just enough taxation to support the minimal state:

NAP: any act of forcible interference (or threat thereof) with another individual’s person or property is a violation of rights, unless either the act is a response to forcible interference (or threat thereof) by that person or the act is an instance of the government collecting taxes for a legitimate purpose.

But the libertarian will now need another ancillary theory explaining which governmental purposes are legitimate and why. After all, the socialist could fully agree with the revised NAP, so long as the socialist also claims that a large welfare state is a legitimate purpose for government taxation. 

The libertarian will no doubt dispute the socialist claim and propose instead that anything beyond the minimal state is not legitimate. However, once again, the dispute between the libertarian and the proponent of big government will have nothing to do with the revised NAP, which both sides can accept. The nonaggression principle, which was supposed to ground the claim that only the minimal state is legitimate, now does no work at all.

Conclusion

When faced with the extreme consequences of NAP, one cannot reply by simply saying, “Well, I don’t want to push it that far.” Principles are not like buses that you can take as far as you want and then get off; they imply what they imply. If you don’t accept the implications of the principle, you don’t really accept the principle; you must reject it or at least qualify it. However, the obvious attempts to qualify or hedge the NAP to avoid such consequences would mean that the principle no longer does any real work in supporting the minimal state.

Of course, none of this implies that libertarians are wrong in advocating only the minimal state; it only means that they would need to support this view on other grounds. Libertarians might, for example, follow Mises in saying that “social utility is the only standard of justice.” In other words, instead of the rights-based talk of NAP, one might try to defend the night-watchman state on broadly utilitarian grounds, claiming that such a state will lead to greater happiness and human flourishing.

Image source:
When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Fed Sets the Tone for 2021

02/25/2021Robert Aro

The Federal Reserve set the tone for 2021 with the release of the year’s first Federal Open Market Committee (FOMC) meeting minutes last Wednesday. With the national debt approaching $28 trillion and covid still not eradicated, there appears to be no intention of ending accommodative policies any time soon. However, the Fed still has a way of never disappointing when it comes to what is discussed behind closed doors. As the minutes reveal, they found:

The emergence of a narrow Democratic majority in the Senate bolstered investor expectations for additional fiscal stimulus, prompting upward revisions to forecasts for economic growth this year.

This logic naïvely assumes a Republican-controlled Senate wouldn’t have the same or similar “additional fiscal stimulus” as the Democrats. It also assumes fiscal stimulus leads to economic growth. Should we continue along this train of thought, we may conclude that any Senate that favors perpetual fiscal stimulus is best since it creates perpetual growth!

We also see the usual Fedspeak, surprising only in its inventiveness:

The Committee’s employment and inflation objectives are generally complementary. However, under circumstances in which the Committee judges that the objectives are not complementary…

This is difficult because it falls back to the idea of a tradeoff between inflation and unemployment. Of course, the problem with this “theory” is that sometimes it works and sometimes it doesn’t. How such an inconsistent theory can ever be relied upon, much less used as a planning tool to form the Fed’s primary mandate, remains a mystery.

And for those unaware, the Fed undertakes desk surveys ahead of its FOMC meetings. The surveys are carried out by the New York Fed; they ask a variety of primary dealers, i.e., those firms able to trade directly with the Fed, questions. Then, a survey is conducted with market participants, comprised of institutional investment firms. According to their expert opinion:

The Desk survey results indicated that a majority of market participants anticipated that the pace of net asset purchases would remain stable for the remainder of the year and slow around the first quarter of 2022.

According to plan, the Fed will continue its $120 billion of asset purchases for twelve more months, meaning we can expect at least an extra $1.44 trillion of US Treasurys and mortgage-backed securities added to the balance sheet a year from now. This assumes there will be no more “additional fiscal stimulus” packages or any surprises which warrant the Fed to take on more forceful actions. The only thing more troubling than the best-case scenario of adding another trillion to the balance sheet is the erroneous widespread belief that the Fed will slow down its purchases ever again.

Last, but not least, the issue of inequality as it pertains to the black and Hispanic communities was addressed:

Many participants stressed that sustained support from fiscal policy would help address the hardships faced by these groups and that monetary policy could also help by promoting the economy's return to maximum employment and price stability.

Here they suggest that the solution to poverty and living in an unfair society revolves around asking politicians and central bankers to intervene even more in the lives of those in need. Naturally, this requires the bureaucracy to get paid for its interference. The public is then left to hope that planners will apply the appropriate amount of intervention, calculating the incalculable and doing whatever it takes to make society more prosperous.

Targets like “maximum employment” and “price stability,” are used, because they show that the Fed is goal oriented. The Fed will claim to fight racial inequality through their support, but their support can only amount to increasing the supply of money and credit, and deciding who gets access to this new money first. If these money creation schemes actually work, one would think the Fed’s goals would have been met by now. Can we really trust that by Q2 2022, as the survey says, the expansion will slow once the Fed finally hits its targets?

What the FOMC meeting ultimately fails to recognize is that by the time we get to March 2022 the only things to change will be the size of the Fed’s balance sheet, the money supply, and the increase in hardships faced by the very same groups the Fed is trying to help.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Failure of Britain's Railway "Privatization"

02/23/2021Paulo Ferreira

It is no surprise to the daily English commuter that British Railway has always fallen short of providing adequate services to it’s customers. Dissatisfaction is at an all-time high, with high ticket fares and poor timing schedules. Rail user satisfaction at 10-year low. To avoid bankruptcy, the state provides subsidies and security bonds to prevent job losses – albeit bonds incur debt that will have to be paid off - and there has been a conscious effort on successive governments in terms of pushing up ticket fares, so that the burden of taxation does not fall entirely on the taxpayer.

This disaster is the offspring of the botched "privatization" of rail which has since evolved into a monopoly of the railway system in Britain. Privatization is only effective if there are other players on the market competing against each other—or at least the possibility of entry for other firms into the market. This helps to keep prices down as the possibility of competition drives providers to better serve customer needs and wants.

With the introduction of the 1993 Railway Act, the Conservative government at the time initiated the privatization of rail by establishing Railtrack, becoming the sole owner of infrastructure in the entire country, laying out the rules for train operating companies. Train companies – national or international – would own and deploy various rail franchises. Rolling stock operating companies provide the necessary locomotives, and freight operating companies, whose primary responsibilities include transporting cargo across the national network.

The main problem holding the industry back however is the lack of competitive infrastructure, for not only does a geographic monopoly exist, but also an overly complex, fragmented system interdependent on a myriad of factors, a tight, bureaucratic labyrinth that drowns out competition. All signals, levels crossings, bridges and tunnels are held on a leash by the Leviathan of rapid transit: Network Rail – the successor to the unsuccessful Railtrack - a public company answerable to the Department for Transport, financing and maintaining the rail tracks by redirecting profits and dividends earned during the year for reinvestment. Strictly speaking, despite privatization, the state reversed their decision and have a final say on how British tracks should be run. The dictum “meet the new owners, same as the old ones” can justly be applied here.

Trains in less dense routes and stations are split into various rail franchises, beginning with a private company placing a bid to secure contracts that allow them to operate on specific routes, as stipulated by the contracts complying with public law regulations. The government takes into consideration each candidate in terms of which company can provide the best passenger satisfaction, as well as optimistic projections of future revenue. The winner, before being awarded the contract, must pay a premium to the government and the projections forecast for the future also increases the premium. Each area has different routes and varying government specifications laying out the ground rules, including train services and station upgrades. However, many of these contracts end up becoming unprofitable due to a lack of demand in certain regions of the country, and private companies owning the rail franchises default, being liquidated as a result. In areas of a less dense population, local monopolies are born, giving the companies a bargaining chip on the region.

It should be noted that various foreign governments dominate several UK rail franchises. For example, Deutsch Bahn (the franchises in question include Arriva Trains Wales, Chiltern Railways, CrossCountry, Grand Central and Northern) is financed by the German government, being the sole shareholder. Therefore, should they cut their investment on Deutsch Bahn would have the detrimental consequence of cutting down the number of trains available for usage to the British public. Other foreign governments too own majority stakes in railway companies, owning nearly all rail franchises in the UK.

Before privatization, economic liberal think tanks such as The Centre for Policy Studies and the Adam Smith institute put forward several proposals. The one eventually adopted by the Conservatives was the one put forward by the Adam Smith institute: different companies running trains. It would have been wiser had the State instead decided to heed the advice put forward by the Centre for Policy Studies, proposing that Britain should go back to the Victorian era structure of a dozen private companies controlling railway.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Fed and "Maximum Employment"

02/11/2021Robert Aro

Keep the definition of “maximum employment,” as explained by the Federal Reserve, forever in mind; and remember it every time an economist or central planner uses it to justify their interventions in your life:

Maximum employment is the highest level of employment or lowest level of unemployment that the economy can sustain while maintaining a stable inflation rate.

However, the Fed cannot reach this lofty goal, as they are unable to articulate exactly what the goal is. This is concerning. Maximum employment is one of the primary mandates of the Federal Reserve. However, they make no apologies. They explicitly state that the Fed

seeks to judge how far the economy is from maximum employment, the Fed will assess a wide range of information on the labor market and not rely too much on any single estimate of a sustainable longer-run unemployment rate.

Jerome Powell told the Economic Club of New York on Wednesday:

maximum employment will require more than supportive monetary policy….It will require a society-wide commitment, with contributions from across government and the private sector.

For us to attain this goal, supposedly, we need more than “supportive monetary policy” (from the Fed). Therefore, it will require more threats of violence, theft, and coercion by the government. Although Powell did not explicitly state these methods, there is no other way to implement a national policy other than with a certain degree of force.

It seems odd to build a society around such vague ideas. But this is the society we live in. It comes as no surprise that Powell’s speech includes a subtitle called: "The Broad Responsibility for Achieving Maximum Employment." He refers to the wake of World War II, seventy-five years ago:

Congress's response was the Employment Act of 1946, which states that "it is the continuing policy and responsibility of the federal government to use all practicable means…to promote maximum employment." As later amended in the Humphrey-Hawkins Act, this provision formed the basis of the employment side of the Fed's dual mandate.

Alarmingly, he is suggesting the quest to attain maximum employment will require sacrifices not seen since World War II! Of course, anytime someone refers to the wartime era as an economic model, we must also consider that higher taxes, tariffs, subsidies, grants, loan programs and even make-work programs will soon follow.

It was Powell who first invoked wartime economics, and he even finished his speech with a national appeal, saying:

I am confident that with our collective efforts across the government and the private sector, our nation will make sustained progress toward our national goal of maximum employment.

While on the subject, it would be a disservice to ignore the central planning schemes of other countries during that time, as dutifully noted by the BBC:

Hitler aimed for full employment and by 1939 there was virtually no official unemployment in Germany.

Unfortunately, even the BBC succumbs to shining a positive light on collectivism:

Despite the loss of freedom, some aspects life improved in Germany for many ordinary people if they were prepared to conform in order to have a job and a wage.

We already see Biden and Yellen working tirelessly on a $1.9 trillion stimulus plan, while the Fed is now aiming for an “inflation at the rate of over 2 percent over the long run.” The Fed continues to increase the money supply, adding over $100 billion of new money to the system with each passing month, while the question of “asset bubbles” continues to be on everyone’s radar except our central bank's. It becomes difficult to imagine just how many more sacrifices society must make for something scarcely articulated.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Swiss National Bank: Negative Rates and Legal Counterfeiting

02/11/2021Robert Aro

Last week, Thomas Jordan, the chairman of the Swiss National Bank (SNB) appeared on national television, stating:

The SNB still regards both foreign currency interventions and negative interest rates as vital to stem appreciation pressure on the Swiss franc…

The significance of these policies may be lost on many. Other than the US Treasury labeling Switzerland as a currency manipulator, no one at any level of government nor any prominent economist seems to have spoken out against the SNB. Luckily, several news articles explain the problem.

On February 2, Reuters released the following statement regarding negative interest rates:

The benefits of negative Swiss rates outweigh the disadvantages, Swiss National Bank policymaker Andrea Maechler said on Tuesday.

She told a panel discussion sponsored by the NZZ newspaper that the safe-haven Swiss franc’s strength would put Switzerland in a much worse position if not for negative rates.

This policymaker's statements cannot constitute “economics.” To claim things would be worse if not for negative interest rates in no way can be proven. Like the US dollar, the Swiss franc is highly sought. But unlike the Americans, the Swiss have been managing their currency for a very long time. Forgetting that negative rates defy logic, we find this notion of the Swiss franc acting as a “safe-haven” to be a problem the SNB decided to tackle. As Chairman Jordan claims:

If the SNB were to raise its policy rate from the current level of minus 0.75%, the franc would rise massively in value and the Swiss economy would be crippled.

The bank has somehow determined a strong currency is bad and that therefore negative rates help keep currency weaker, as to not “cripple” the economy with strong purchasing power and low prices. While negative rates punish savers in Switzerland, the continuation of these market interventions eventually impacts America and explains the vast holdings of US equities.

Another Reuters article on January 29 gets to why currency intervention is problematic:

The SNB makes a profit from its vast holdings of foreign currency investments built up during its long campaign to slow the rise of the safe-haven Swiss franc.

The SNB claims the objective is to devalue its currency, therefore, like the Federal Reserve, it expands its balance sheet (i.e., creates money). This newly created money is exchanged for US dollars then US equities are purchased. The countless dividends and billions in capital gains received is nothing more than a by-product of being compelled to devalue the Swiss franc.

By year-end 2020, their ongoing currency management had incidentally led to ownership of a $140.7 billion US equity portfolio. This is a $13 billion gain from last quarter. Given how lucrative foreign equity purchases can be, why every other central bank in the world doesn’t jump into the stock market remains a mystery. As reported:

The Swiss National Bank has agreed to a new deal with the Swiss government which could see the central bank increase its annual payments to Bern and the country’s local governments to 6 billion Swiss francs ($6.7 billion).

This makes for an increase of 2 billion from the previous year, which seems reasonable as:

The SNB said earlier this month it expected to make a profit of around 21 billion francs for 2020 as soaring gold and stock markets boosted the value of its foreign currency assets.

Also keep in mind that from Q1 to Q3 of 2020 the bank increased the size of its currency intervention total

to just over 100 billion francs, well above the 13.2 billion francs it spent for all of 2019 to buy foreign currency.

The curious case of the currency too strong for its own good is one to watch in 2021. If we look beyond the vague belief about how to best manage a currency or find an ideal exchange rate, there really is no mystery.

It’s one thing for a central bank to hold its own interest rates negative, but quite another to create digital francs, exchange them for digital dollars, then buy US stocks at virtually zero cost; all for the stated purpose of weakening the franc. But let’s be honest, if you owned your very own central bank, wouldn’t you do exactly what Switzerland is doing?

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The NBA's National Anthem Mandate: Another Political Ploy from Pro Sports

02/10/2021Ryan McMaken

Listen to the Audio Mises Wire version of this article.

Dallas Mavericks owner Mark Cuban is under fire for neglecting to play the national anthem (i.e., "The Star-Spangled Banner") at his team's home games. According to NBC News

The anthem has not been played at any of the 13 preseason and regular season games played so far at American Airlines Center at the direction of Mavs owner Mark Cuban….

Cuban confirmed to The Athletic and ESPN that he had altered the pregame ritual, but declined to explain further.

In response, the NBA quickly issued an edict that all NBA teams must play the anthem before every game.

Ridiculously, the Mavericks organization was forced to clarify that "the decision to not play the anthem before games wasn't because the franchise lacks love for the United States."

This is a song and dance we Americans should be accustomed to by now. During the early twentieth and late nineteenth centuries, Americans adopted a variety of new progovernment rituals designed to inculcate an ideological preference for political unity, uniformity, and obeisance to the regime. Most notable among these was the introduction of the "Pledge of Allegiance," written by a socialist and designed to inculcate into Americans the idea that the United State was forever "indivisible." (It was also part of a business scheme to sell American flags.) 

By the 1920s, the national anthem was growing in popularity as well. 

This was all in contradiction to earlier nineteenth-century values of Jacksonian republicanism, which valued localism and a suspicion of national rituals. Andrew Jackson, for example, had refused to go along with the customary political declarations of days of prayer and "Thanksgiving." The Jacksonian view was that Americans can manage their own cultural affairs at the local level without any need for quasi-religious national rituals of "unity." 

Thanks to the Civil War and the First World War, though, local cultural autonomy gave way to new cultural expectations that Americans stand around pledging allegiance to the state and singing secular hymns extolling the wonders of "the land of the free." Any dissent from these "traditions" was to be condemned as acts of "hating America."

This politicization of pro sports has continued to today, even if it has taken a bit of a left-wing turn in recent years. 

The Rise of the Sports-Anthem Connection

The fact that participation in these rituals at sports games has become almost mandatory—at the risk of being punched in the nose by some red-faced "patriot"—would have struck most nineteenth-century Americans as rather odd. 

Indeed, the connection between the national anthem and professional sports games appears to have not begun until the end of the First World War. Before the First World War, playing the national anthem at sporting events was quite rare. No one expected it to be done, and hiring a band was expensive. 

According to mlb.com, the most conspicuous early use of the national anthem was at game 1 of the 1918 World Series during World War I. Unexpectedly, during the seventh-inning stretch, a military band played the national anthem in an effort to liven up a reportedly surly and war-wearied group of spectators.

Use of the anthem spread from there. The anthem's use expanded even more during the Second World War, as Matt Soniak notes: 

During World War II, baseball games again became venues for large-scale displays of patriotism, and technological advances in public address systems allowed songs to be played without a band. "The Star-Spangled Banner" was played before games throughout the course of the war, and by the time the war was over, the pregame singing of the national anthem had become cemented as a baseball ritual, after which it spread to other sports.

But even after the war, the habit of playing the anthem at every game was not firmly in place until the Vietnam War. 

It was during the Vietnam War, however, that the spread of the national anthem's use finally met with some resistance. Historian Marc Ferris, in his book Star Spangled Banner, notes that similar protests took place in the NFL during the late 1960s and early 1970s. Ferris recounts how "[r]esponding to [protests during the playing of the anthem at the 1968 Olympics,] the league's commissioner, Pete Rozelle, required players to hold their helmets in their left hands and salute the flag during the anthem." But, This was not without its detractors within the NFL, and, Ferris notes, "Anthem controversies [during the 1970s] helped institute and increased analysis of sports, which turned into the primary battleground over the beleaguered national anthem and its meaning." 

By the Obama era, however, not even this grassroots spread of the anthem was sufficient for the federal government. 

By 2009, the Pentagon was actively using taxpayer money to pay the National Football League to expand "patriotic" displays:

In 2009, Barack Obama's Department of Defense began paying hundreds of thousands towards teams in a marketing strategy designed to show support for the troops and increase recruitments. The NFL then required all players and personnel to be on the sidelines during the national anthem, in exchange for taxpayers dollars. Prior, the national anthem was played in the stadium but players had the option of staying in the locker room before heading out to the field. 

Furthermore, teams that showed "Veteran's Salutes" during games were paid upwards of $5.1 million dollars.

In total, $6.8 million in taxpayer money was doled out to sports teams—mostly NFL teams—for so-called paid patriotism.

A Marketing Gimmick

In most cases, the use of the anthem was not directly subsidized, however. Usually, team owners quite voluntarily employed the anthem as a marketing gimmick. In times of war, team owners were happy to use the anthem as a type of advertising to make an emotional connection between the customers—i.e., the spectators—and the team's product. Wrapping a commercial product in the flag and apple pie to increase sales is hardly unique to professional sports. But pro sports may have used this tactic more successfully than any other industry.

Prior to its use in sporting events, the national anthem had been cunningly used by Vaudeville acts "when the management would bring out the flag to win applause for a poor act." This fact, related by Baltimore Orioles general manager—and World War I veteran—Arthur Ehlers was presented as a reason why Ehlers opposed playing the national anthem at every game. Ehlers felt that overuse of the anthem could be done cynically and would "cheapen" the song.

Ehlers, it turns out, remembered things correctly. In an article in Collier's magazine in 1914, the amused author notes the widespread use of the anthem to elicit a positive response from audiences at performances: 

[N]othing is more destructive to gravity than to watch a small oppressed poodle dog walking a tight wire in a vaudeville show with the United States flag hanging from his mouth, while the orchestra plays "The Star-Spangled Banner" and some stout, earnest woman, standing in solitary grandeur in the middle of the house, glares at the sodden mass of humanity which declines to do reverence to the anthem or the flag or the dog….If encouraged in this sort of business, some clog dancer may yet do the Doxology in ragtime while the audience stands with bowed and contrite heads.1

Apparently, by 1914, it had already become fashionable to use the anthem to browbeat spectators into assigning deep meaning to what was clearly—like NBA basketball—never anything more than trivial lowbrow entertainment. The author, with his sarcastic reference to the anthem as a doxology knew when he was being manipulated.

Decades after the Collier's writer observed the anthem's value as a commercial strategy, Ehlers, it seems, was attempting to actually preserve some dignity for the anthem.

Everything Is Political

The NBA's new mandate that every team must play the anthem is the sort of thing we've come to expect from organizations like the NBA and the NFL. Although the NBA has spent much of its time in recent years trying to appeal to Chinese nationals, it has apparently decided that it's still in the game of pandering to Americans, with gimmicky displays of "patriotism" on the one hand and "Black Lives Matter" slogans on the other. Of course, pro sports organizations could have elected to simply not have any political content in their games at all. That would have been the smart thing to do. Instead, organizations like the NBA and the NFL have spent the last few decades relying on the national anthem as a cynical ploy. Employing "antiracism" and BLM politics is just the natural evolution of this. The NBA's latest turn toward supporting use of the national anthem shouldn't be read as any sort of move toward right-wing politics. It just a signal that the NBA continues to believe it can easily manipulate its audience with slogans and displays of jingoism. The NBA is probably right. 

  • 1. "We Shy at Vaudeville Patriotism," Collier's, Mar. 14, 1914.
Image source:
When commenting, please post a concise, civil, and informative comment. Full comment policy here

This Impeachment Is Now about More Than Donald Trump

The move to impeach an ex-president is no longer about Donald Trump.

The Democrats’ coming lawless impeachment trial violates the Constitution and libertarian tradition. The Constitution states impeachment can only be used against federal officials, that it doesn’t apply to private citizens. Article II, Section 4, states who can be impeached. “The president, vice president and all civil officers of the United States, shall be removed from Office on Impeachment for, and Convictions of Treason, Bribery and other High Crimes and Misdemeanors.” It doesn’t cover postoffice careers.

So Congress, despite the insistence of Trump’s opponents, lacks the power to impeach someone who is no longer a federal official. And the Constitution also prohibits Congress from enacting “ex post facto law.”

But the law, and even its recent impeachment precedents, the Democratic leadership is saying, doesn’t matter. They are basing their argument on a tenuous report of the Congressional Research Service (CRS) that says ex-officials can possibly be impeached. But, in the case of a president, it has never happened.

Indeed, the report, The Impeachment and Trial of a Former President, does say that “there are textual arguments against Congress’s authority to apply impeachment proceedings against former officials.” Even in arguing that some legal scholars say this unprecedented impeachment is possible, the report must hedge the point.

Still, it says that “the plain text of the Constitution states that ‘the President, Vice President and all Civil Officers of the United States, shall be removed from Office on Impeachment…and Conviction,’ could be read to support the requirement that the process only applies to officials who are holding office during impeachment proceedings.”

The CRS report only cites a nineteenth-century secretary of war who was impeached after he left office. But he was exonerated in the impeachment trial partly because several senators said former officials couldn’t be impeached. And this argument is affirmed by US Supreme Court justice Joseph Story in his Commentaries on the Constitution of the United States.

An irony of this lawlessness is that Democrats are violating their own recent precedents. In their 2020 Trump impeachment they targeted a sitting president. They produced substantial evidence in the House. The trial in the Senate was presided over by the chief justice, as required by the Constitution.

But in this second impeachment, in the one-day snap impeachment in the House, Democrats never produced evidence. They only produced rhetoric.

Comparing this to a trial, one in which evidence is examined and testimony is taken, is a judicial joke. US Supreme Court chief justice John Roberts will not be part of this second impeachment. Instead, this trial will be presided over by one of Trump’s senatorial critics. In a Kafkaesque twist, Senator Patrick Leahy presides but also votes!

The Democrats’ rationale in this unprecedented impeachment of a private citizen is that Trump must not escape criminal penalties for his alleged plotting in the Capitol attack. Without impeachment, Senator Chuck Schumer says, Trump will have “gotten a get out of jail free card.” However, the logic is flawed.

Private citizens, including ex-presidents, are subject to criminal law. Otherwise, why did President Nixon, charged in the Watergate crimes, accept a pardon after leaving office? But these Democrats are setting a precedent that could destroy our nation.

If a Democratic government can impeach a former Republican president, then why can’t a succeeding Republican government impeach a former Democratic government? How about former president Bill Clinton? Could he be impeached? Why not? But this is what Democrats want.

The charges brought by Democrats in a highly charged ex post facto impeachment trial would not be the same as in a regular criminal court. In the latter Trump would face a jury of his peers instead of a congressional jury of mostly people who hate his guts.

The criminal justice process as guaranteed by the Bill of Rights is not the formula most of the congressional Democrats want. This is one reason they prefer to impeach Trump in a political environment and not let him be tried in a criminal court. Courts must have nonbiased jurors and judges.

The Democrats don’t seem to care about constitutional safeguards that extend to everyone, even the most unpopular, controversial of people in a free society. That’s not surprising, since many radical Democrats have already suggested that various parts of the Constitution, such as those guaranteeing free speech and the right to arms, be scrapped.

But are these Democrats, who are forcing us down a constitutional hole that will destroy the law, aware that their malevolent actions could turn on them as well as their opponents?

“He who fights with monsters should be careful lest he thereby becomes a monster,” Nietzsche writes in Beyond Good and Evil.

And, Nietzsche continues, “if thou gaze into an abyss, the abyss will also gaze into thee.”

If the Democrats win, if they distort the Constitution to their political will, we’ll be deep in a constitutional abyss from which we will likely never emerge.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Trump Political Show Trial

02/08/2021Ron Paul

Listen to the Audio Mises Wire version of this article.

The Senate trial for now twice-impeached former president Donald Trump is set to begin this week, with little doubt over the outcome. A procedural vote in the Senate on the constitutionality of “removing from office” someone who is not in office revealed that nowhere near enough Republicans were willing to join their Democrat counterparts in voting to convict.

Supreme Court chief justice John Roberts, who is required by the Constitution to preside, has by refusing to participate made it clear that he does not consider the upcoming action in the Senate to be a legitimate impeachment trial.

So if it is not a legitimate trial, what is it, then? Judging from the House impeachment resolution, it looks more like a banana republic “show trial” than a careful case detailing Trump’s “high crimes and misdemeanors.”

Trump was impeached by the Democrat-controlled US House for “incitement of insurrection” over the January 6 melee at the US Capitol. Telling his supporters they must fight or they’re “not going to have a country any more” was cited in the impeachment resolution as evidence that Trump “gravely endangered the security of the United States and its institutions of Government” and has “demonstrated that he will remain a threat to national security, democracy, and the Constitution if allowed to remain in office.”

Trump also told them to march to the Capitol “peacefully and patriotically” to encourage Congress to consider his claims of election fraud, but Democrats in the House say that he didn’t really mean it.

Why the snap impeachment? Why not, as constitutional law professor Jonathan Turley has written, hold hearings and call witnesses to explore whether the former president actually had insurrection on his mind? Did he call off or delay the National Guard troops from protecting the Capitol, for example?

Or was he simply using heated political rhetoric that his accusers in Congress have also used plenty of times?

Weeks of hearings in the House with dozens of witnesses could have helped make the case for the Senate that Trump was guilty of inciting insurrection. Such hearings could have turned the tide against Trump in the Senate, where he is certainly not universally supported within his own party.

But the House had no interest in such hearings. They wanted a snap impeachment. They wanted no witnesses. They wanted to benefit from the universal mainstream media narrative that the mob who entered the Capitol building was not just unruly Americans angry over what they believed was a rigged election, but was actually trying to overthrow the government to keep Trump in power.

The House Democrats knew that the “insurrection” narrative would not stand the test of time—anyone familiar with “color revolutions” or coups overseas would easily recognize that this was not one. So they rushed through the impeachment not because they wanted to remove him from an office he no longer occupied, but because they wanted to bar him from ever running for office again.

It does raise the question: What are they afraid of? They called their impeachment a victory for democracy, but isn’t preventing Trump from running again a subversion of democracy?

Trump would do well to ignore the Senate proceedings. There is no reason to participate in a show trial. The media has reported that he intends to focus on the “stolen” election in his defense before the Senate. That would be counterproductive. The right question to ask is, “what if they held a show trial and nobody came”?

Reprinted with permission.

Image source:
Joe Flood via Flickr
When commenting, please post a concise, civil, and informative comment. Full comment policy here

Technocrats Everywhere: Central Bankers as Political Saviors

02/05/2021Robert Aro

The word “technocrat” is seldom used by the liberty crowd. It invokes the idea of a bureaucracy using technical experts to somehow make the right decisions on behalf of the entire nation and stands as the antithesis of a free society. Sadly, it captures the essence of central banking as well. This week, news came out of both Italy and Australia showcasing how this works. Starting with Italy, on Tuesday, the New York Times praised the technocrat when announcing that former head of the European Central Bank Mario Draghi was summoned to Italy in hopes of becoming the next prime minister. Described in the paper as the “pie-in-the-sky wish of many of Italy’s European Union-friendly politicians,” Draghi appears to be the man destined to guide the nation out of the current pandemic. As explained:

By officially bringing in Mr. Draghi as a potential leader in a critical moment, Italy seemed poised to return to the model of the technocratic government that has the reputation of bailing out the country when its political forces fail.

The press tells us politics has failed the country, but salvation can be found through electing a better, more skilled and experienced leader. In this case, it becomes the job of one of “Italy’s highest profile international officials,” who it said to have once steered Europe out of crisis almost a decade ago:

He is credited with easing interest rates and proclaiming in 2012 that he would do “whatever it takes” to save the euro as the Central Bank’s president during the eurozone debt crisis.

The value of the technocrat lies in his ability to do “whatever it takes,” especially in time of crisis. Understand, the “whatever it takes” attitude of a central banker will invariably include more debt issuance, making it ironic that the eurozone debt crisis was solved by creating more of the existing problem. As we see, his remedy:

Months later, he promised unlimited purchases of eurozone government bonds to deeply indebted countries, including Italy, effectively relieving crushing financial pressure.

At the moment, high debt levels don’t concern our planners as rates are either low or negative. However, this does not solve any crisis so much as it prolongs it with the inevitability of it being more severe in the future.

In this regard, Europe today resembles the situation in the USA, stuck where keeping rates low forever must eventually meet the reality that rates must rise one day; it is our central planners who must take the credit for this.

On the other side of the globe, in Australia, we see that the explanations given by our leaders are not always true. This was reiterated on Tuesday when the head of the Reserve Bank of Australia, Governor Philip Lowe, announced an additional AUD 100 billion bond buying, in addition to the AUD 300 billion stimulus on the fiscal side. CNBC notes:

The stimulus has ignited a fire in the housing market where prices are at record highs…The resurgence in the property market supports household balance sheets and encourages spending through positive wealth effects, Lowe said.

If true, and the “positive wealth effect” refers to government stimulus which created currency debasement causing asset prices to increase, then it’s hardly a cause for celebration. How this wealth effect can be measured is unknown to even the governor himself. It fails to consider that if everyone’s house increases in price, we cannot then claim we are all better off. Nor are the effects of the debt burden considered as the focus remains on assets, not liabilities, as well as spending over savings. No one seems to consider the repercussions of having the housing market “cool off” after a sustained period of being on “fire.”

Like a young adolescent who wants to be treated as an adult, but who cannot fully comprehend that all actions carry consequences, those charged with planning our future constantly seem incapable of planning beyond the things they find most gratifying in the present. Whether it’s a former central banker on the way to manage the affairs of Italy, or the current head of monetary policy for Australia, the technocrat is paid handsomely to do the impossible; probably due to the manner in which they are trying to make our lives better. It is quite literally, impossible.

When commenting, please post a concise, civil, and informative comment. Full comment policy here

The Cathedral Is in Decay

02/04/2021Mark Metz

One of Robert Greene’s forty-eight laws of power in his book that goes by that same name is to “create compelling spectacles” as a means of creating the aura of power. One can imagine what this sort of thing looks like. Perhaps we think of movies in which an antagonist commits an act of great terror that helps create an aura of power surrounding his image. 

Unfortunately we don’t actually have to resort to movies in order to witness a deliberative attempt at creating a spectacle in order to construct an image of power. One only has to look at what's currently going on in DC, as military personnel remain stationed there a week and a half after the inauguration. It's a military occupation, something that our post–Civil War military typically only does in foreign cities. 

The inauguration came and went, and with no incident. No right-wing riots or acts of terror that we were supposed to beware of. And yet, the rhetoric and actions, regarding these now labeled “domestic terrorists” persists. 

Former CIA director John Brennan has declared who the Biden administration should go after, adding "even libertarians" to the list. An alert for ‘heightened threat’ of a domestic terror attack has recently been issued by the DHS, and persons warned of in this alert include people who are angry about the 2020 election and with the government’s covid-19 restrictions, and those opposed to immigration. And now observe as calls for redditors to be labeled as domestic terrorists will also soon commence. 

All of this is power flex by the deep state and the Left. And what makes this sort of flex seem more legitimate in the eyes of common folks is the manufactured military occupation of Washington, DC. In other words, if the troops are needed, then this problem of right-wing extremism must be a serious issue indeed.

Attempts have been made at pointing out the hypocrisy of these actions: the BLM and Antifa riots of the summer and beyond produced exponentially more damage than the Capitol Hill riot did. The Left for four years claimed Trump was an illegitimate president who stole the 2016 election with help from the Russians. The irony of John Brennan labeling political dissidents terrorists after the CIA armed actual terrorists under his watch. 

All of those points of hypocrisy are factual. However, despite the truth behind the claim of leftist hypocrisy, pointing it all out seems to be falling on deaf ears. And this is no accident. The Left owns popular culture, the corporate press, higher academia, and the deep state, with those last three forming what’s called the Cathedral by writer Curtis Yarvin. Being in possession of all of these entities has allowed the Left to create what seems to be a stranglehold on society. 

But is the hold actually as strong as what it appears? 

Don’t get me wrong, the outlook looks fairly bleak at the moment. Nonconformity being labeled as terrorism is something we only used to read about or watch in movies. People getting deplatformed for questioning the election results or covid-19 restrictions is evident of a heavy-handed State seeking retribution. And unfortunately, things could get even worse; this might just be the start of what we can expect to persist. 

However, consider all that’s going on and think about the people or entities you know that are most in control of themselves and their actions. Do they act in the way the Cathedral is currently acting? Do they become unhinged and feel the need to suppress dissident thought, erase the past, and manipulate language as a way of ridding themselves of their “enemies”?

These are not the actions of people in control of themselves. And they’re certainly not the actions of people who possess a stranglehold upon society. Because the truth is that their grip is slipping, therefore they’re gripping harder, increasing their firmness so as to not lose control altogether. This firmer grip is creating short-term ramifications for those of us on the other end, but the long term ones will be saved for those who are trying so desperately to maintain their hold. 

The hold, though, will not last. 

In the meantime, don’t become demoralized, for that’s what they way want. Demoralization will only help them regain their grip. Instead, look to the cracks in the Cathedral’s foundation. Donald Trump, although no libertarian hero, was a crack, an outsider who was not supposed to attain the highest office. A bunch of reddit users weren’t supposed to outmanipulate Cathedral profiteers—hedge funders deeply tied in with the regulatory state. Look to these as signs of hope, as glimmers of light shining through the dark and seemingly impenetrable walls of the Cathedral. 

Because ingrained within the need for constructing an illusion of power is the projection of an imminent foundational collapse.

When commenting, please post a concise, civil, and informative comment. Full comment policy here
Shield icon power-market-v2