Power & Market
As a black man, this bothers me, and I hope anyone who loves freedom and liberty feels the same.
Last week, in celebration of Black History Month CNBC continued with its “Invest in You” series:
featuring weekly stories from CNBC contributors and members of the Financial Wellness Council, including the lessons they’ve learned growing up, their advice to Black youth, their inspirations and how they are working to close the racial wealth gap.
The definition of the “racial wealth gap” is not provided, but they share a stat from a Federal Reserve study to provide an idea:
The median wealth for a White family was $188,200 in 2019, compared to $24,100 for Black families and $36,100 for Hispanic families.
No one can reasonably say what median wealth should be. However, we can say the median wealth of white families is many more times the median wealth of black families. We are offered solutions as to how to bridge the gap, recommended by several African Americans, presumably experts, whose opinion we should listen to because they are either famous or rich:
Quoting Akbar Gbajabiamila, former NFL Player turned cohost of American Ninja Warrior, who believes financial literacy can help lessen the gap. His solution is:
People in power need to step up and help open up financial advising for everyone.
Higher up the wealth bracket we hear from the first black billionaire, Robert Johnson, who sold Black Entertainment Television (BET) in 2001. He believes powerful business people should be called upon to help black Americans advance. It’s unclear if he means powerful blacks or all powerful people. Either way, the successful people “achieved their success by having opportunity.” He goes on to say that these powerful people should tell black Americans:
“We’re gonna give you equal opportunity that we had, we’re gonna give you access to capital that we had, and we’re gonna ensure that you have a chance and a fair shot at participating in the American dream.”
There were even more people who weighed in on the issue. But the flavor of the article should be apparent by now. Time after time, whether from the mainstream media, politicians, or central bankers, we are told that the answer to our economic problems is for those in power to simply take the right action to help those in need. According to the quote above, if powerful people simply decided to grant more opportunities to those in need, it would allow the marginalized to get their fair shot, therefore achieving The American Dream…
Unfortunately, the opportunity to provide something useful to the black community and anyone else experiencing hardship is lost on CNBC. When we talk of opportunity, many forget it is the government and their central banks that are at the forefront of limiting our ability to succeed. Consider the effect of regulations, free market intervention, and inflationism and refraining from them would help better close this gap between all races.
Regulations. The list is long: the war on drugs, prohibitions on selling goods and/or services, import tariffs, minimum wage laws… to name a few. There are countless rules which govern our lives. Yet these rules are involuntary restrictions placed by the powerful over the masses. Society could find positive economic outcomes if we simply removed laws which limit economic freedom.
Interventionism. Remember, it is the Fed that creates over $100 billion a month to buy government debt, tinkers with interest rates, and creates special programs to assist certain members of society at the expense of other members of society. The powerful tell us these programs are for our own good and that if it weren’t for them society would be much worse.
Inflationism. The long-standing fallacy of money creation for the purpose of wealth creation. However, the same money supply expansion benefits the most powerful members of society first. Ironic how so many people turn to those same powerful people for help when their priority is to preserve their own advantages.
This month, many were given a chance to talk about issues facing African Americans. Sadly, without understanding ideas of liberty and freedom, those who would benefit most from capitalism will continually seek socialism. When most people talk about opportunity, it’s often in the context of getting a handout or a leg up from another. Perhaps the best opportunity is to not limit someone’s opportunity from the start.
The recent blowup of GameStop shares has revealed, if anyone was still doubting, that the center of clown world is not Washington, DC, nor Silicon Valley—but Wall Street. To be clear, this is not meant to refer to the gallant band of redditors from r/wallstreetbets—those few, those happy few, that band of brothers who, as of this writing, may very well be poised to force several hedge funds into bankruptcy. Rather, the clowns are those hedge funds and all those other institutional investors who have been propped up by central bank intervention for decades while congratulating themselves that their seven-figure earnings were all due to their own financial brilliance.
The story of what happened (so far) is briefly told. It was revealed that GameStop was one of the most shorted shares in Wall Street, with the fund Melvin Capital taking the lead in shorting it. While this may or may not be a sound position based on market fundamentals—I have not investigated and think it’s a mug’s game to waste time on fundamentals these days—people did not take kindly to the revelation. Specifically, redditors at the subreddit Wallstreetbets saw that the short sellers were vulnerable, and they organized a campaign to drive them into the ground. Suddenly, retail investors flooded the market, bought up shares and drove GameStop shares, which had been trading below $20, into the stratosphere, topping $365 Wednesday morning (January 27). Melvin Capital suffered huge losses, up to 30 percent, and had to be saved by an infusion of $2.75 billion Tuesday afternoon.
That’s Not the Whole Story, Though…
In a sane market, where market fundamentals actually determine prices, this would not have happened. Short selling would simply be a way of quickly and efficiently determining the market price of stocks, and there would be no special profit to be had from this practice, beyond the arbitrage gain (in the case that the short sellers were correct). Similarly, investors angry at the short sellers could not have driven stock prices sky-high in defiance of reality. Both practices are only possible in a market flooded with ever-increasing amounts of new money freshly printed by the Federal Reserve.
For decades the central banks of the world—chief among them the US Federal Reserve—have had really only one mission: interest rates cannot ever be allowed to rise and everything must be done to prevent even the mildest of corrections in financial markets. They were able to get away with it clandestinely, so to speak—who now remembers the good ol’ days of the Greenspan put?—but after the financial crisis of ‘08 they had to come out into the open. Interest rates were forced lower and lower and markets were flooded with a tsunami of credit. Stocks and bonds responded, as could be expected, by reaching new all-time highs year after year. Of course, there were always economists ready with ever more whacky theories as to why this bare-faced inflationism was really sound policy dictated by the science of modern economics, but the result for anyone to see is financial markets that are completely divorced from reality and whose only purpose seems to be securing cheap funding for the US government and enormous earnings for the financial elites.
Then, of course, came corona, and the government, in its wisdom, chose to destroy the economy. To placate the plebs they offered them a few handouts—first $1,200, then $600—all financed by that incredible machine, the central bank printing press. According to Keynesian orthodoxy, this should have stimulated the economy to no end, ensuring a rapid recovery. Unfortunately, since most of the world was shut down, there were precious few opportunities for people to actually spend their money, and since the man in the street is wiser than most government-employed economists, he probably understood that an unprecedented shutdown of all society is not the best time to engage in a bonanza of consumer spending. So, he saved and invested his money, which thanks to the advances in modern technology he could now do directly, without going through savings banks or brokers.
Yet inflation is still inflation, even if it does not show up in government statistics, and the infusion of such an ocean of liquidity naturally drove stocks, bonds, bitcoin, and now GameStop sky-high. The beneficiaries this time were not the banks or Wall Street investors, however, but the many retail investors who now ganged up on Melvin Capital and the other “sharks” of Wall Street. It is all animal spirits, or rather, it is driven by the desire of those who feel themselves shortchanged to see the high lords of finance come crashing down. This latest round of inflation gave them the means to bring about just that.
Is This the End?
It’s impossible to tell what will happen next. Maybe the flood of liquidity is spent and Wall Street will weather the storm; maybe the Fed will again step in with new credit lines to save them, which seems most likely—again, the prime directive of the Fed has always been to save the big shots in finance. It is possible that financial markets are now so broken, central bank officials so worried about the effects of their money printing, that nothing will be done and we are now seeing the beginning of the end of the Big Bubble of 1980–2020. However, if recent history and mainstream economic orthodoxy are any guide, the Fed will stop at literally nothing to “save” the markets.
As Zero Hedge remarked on Twitter, “What is remarkable is how many people are “surprised” by what is going on in the “market” You throw $20 trillion stimulus at it, you nationalize the bond market, you break all links between price and fundamentals…what do you think happens.” Indeed. It would be wholly fitting in clown world, however, if the Great Stock Market Crash of 2021 were begun by day-trading teenagers, flush with helicopter money (thanks, Uncle Milty!) and with nothing else to do, forming a mob on reddit in order to break a hedge fund.
The first year of this decade has given us time to pause and think about how the world stands in terms of global development. One widely used statistic to examine development, which shall be called the “dollar-a-day” idea, measures the idea of poverty in an all too narrow manner. For this article, we will examine the limitations of this metric, as well as implications of a theoretical notion by John Maynard Keynes that predicted poverty would end by 2030.
A Brief History
In an online lecture series based on his book, The Age of Sustainable Development, author Jeffrey Sachs puts forth the idea that poverty could be a thing of the past by 2030. For this, he draws upon a musing from John Maynard Keynes, where the father of modern macroeconomic theory wrote in 1930 about how poverty would end in the span of a hundred years. This view of poverty is associated with material wealth: John Maynard Keynes was, after all, a privileged Englishman in his day.
In this day and age, Jeffrey Sachs links this to the idea of extreme poverty being eradicated by ensuring that every person in the global population lives over the international poverty line, as dictated by the World Bank. This same poverty line was conceived in the 1990’s as a threshold of living off a dollar a day, or equivalent. There are, however, some problems with using this standard as the single benchmark for ending poverty within the next decade.
The Dangers of This Definition
The first problem is that the dollar-a-day measure is based on an idea that is now three decades old. It is pegged to the currency of one economy, and, as some would argue, is still too low to be contextually appropriate in all cases. Should we still take this measure at face value?
There have been attempts to continue adjusting and salvaging the metric to suit the needs of today, such as drawing other thresholds to factor in inflation at $1.25, $1.90, or even rounding up to $2 a day, or by calculating against purchasing power parity for local currencies.
That said, there have also been great strides made in development studies since the 1990s, especially in the qualitative sense, to get a better and more holistic idea of poverty than by simply having a dollar a day, two dollars a day, or whatever other variation of this idea is being used, to dictate definitions of poverty.
Speaking of simplicity, that is the second problem. One appeal of the basic income approach to development is that it allows for easy, though sometimes arbitrary, ways to set simple standards to determine if someone is in poverty or not, just by picking a threshold and looking at what they earn as income. For example, if you happen to be earning and living off $2.00 a day as your basic income, then you are not considered to be poor by the dollar-a-day metric, end of story.
This idea has also formed the basis for national governments to form and create other simple metrics to set their own standards of poverty, and to enact policies that attempt to raise the standard of living for their citizens. However, the actions of citizens, influenced by local culture, personal subjectivity, and other factors, often reveal to us that such policies are inadequate relative to what people actually perceive as in their needs in life, which necessarily include more than just having money.
As a metric, the dollar-a-day measure is, pardon the pun, quite poor: indeed, it is argued that poverty statistics do suffer from a certain poverty, as posited by Don Mathews. The whole experience of poverty, and even the value of human life itself, cannot simply be captured and depicted in numbers and statistics. This is the third danger of defining poverty in such a manner.
The temptation to define poverty solely by income ignores other, deeper, and more complex issues related to it, such as the need for freedom and inclusion in society. Does having a dollar a day also mean that one's personal rights and liberties are respected? Or that one is happier with life, and not in a fleeting sense, but in a sense of lasting happiness? If not, then one continues to be in poverty and unfree as well, even if the number imposed on them says that they are no longer poor.
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.
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.
The Colorado Republican Party is the very definition of "sadsack." Over the past fifteen years or so, the party has repeatedly nominated candidates for office that were so inept and so uninspiring that even a population that wanted tax cuts couldn't bring itself to vote for the GOP. How do we know a majority of the voters want tax cuts, even if they keep voting for Democratic governors and legislators? We know this because even when a majority of the voters repeatedly vote Democrat, they simultaneously vote for statewide referenda that lower taxes.
A similar thing happened this year. A majority of voters went with the Democratic candidate for the US Senate (John Hickenlooper) but simultaneously voted for a cut to the state's income tax. Voters also passed a new law requiring a vote on future attempts to raise fees for state "enterprises" like state parks.
The requirement for a statewide vote has proven to be a significant barrier. Voters in the state have overwhelmingly voted down attempts at raising statewide taxes. At the local level, taxpayers have proven much more tolerant, especially when new taxes are earmarked for specific purposes.
Tuesday is the last chance for (most) Americans to cast their vote for president. What will make the difference in attaining victory? When it comes to messaging, Team Biden relies on elite news outlets for assurances of victory, while Team Trump’s preferred sources are blacklisted by social media and ignored by broadcast news organization.
But what does recent history tell us about which voice is most likely to prevail?
In 2016, Trump’s unusual and unrefined demeanor brought him closer to those who had long been left out of the political discourse.
But despite his apparent popular appeal, pundits and major cable news outlets all but gave former secretary of state Hillary Clinton the victory. On Election Day, however, things didn't go as the Democrats planned. Few predicted the outcome.
After four years, his anti-establishment rhetoric has continued to cause many to see him as the antipolitician candidate, even though he has ultimately failed to deliver on many of his promises.
Can the populist strategy work again?
Maybe. The lessons of 2016—taking a stand against the status quo—don’t seem to have stuck with Democratic activists. The party has remained energized by its long dedication to exploiting identity politics and pushing ideological concepts that often don’t resonate with its own base.
From promising to maintain the US's failed foreign policy strategy in the Middle East to pushing the already debunked “Russia did it” talking point to exhaustion, the Democrats have stuck with what has been used to shore up the base in recent years, while ignoring much of the center. Instead, they have chosen to double down, even threatening with physical violence those who oppose their message.
Consider Biden’s running mate, Kamala Harris, who went as far as promising that the violent riots that followed the death of George Floyd “were not going to stop” until “there are people in the system who are willing or pushing” to make a difference.
Biden, meanwhile has hurled threats at much of the population by promising “nationalization” of mask wearing and vaccine distribution. Presumably, such measures would require enforcement by armed agents of the state.
Many voters are likely to find Trump to be relatively laissez-faire in comparison. Yet that remains a low bar. Trump promises to downsize the US military’s presence in Afghanistan but has not done so. But in practice, his approach to fighting the pandemic has been far less reliant on mandates and state coercion than what Biden proposes.
When it comes down to the main differences between the two candidates, many voters may ultimately conclude it’s clear that Biden is the professional politician whereas Trump remains the loudmouthed, anti-establishment guy. This may help Trump with some voters. Moreover, although Trump is now an incumbent, he is nonetheless running against lifelong politicians like Biden. As Trump was careful to note during the first debate: “If I thought [Biden] did a good job, I never would have run.”
The other difference is that now, compared to 2016, Americans are likely to be even more weary of politics thanks to the coronavirus lockdowns, BLM riots, and the destruction of businesses by both the mob and state governments. Whatever the motivation, Trump stands to benefit so long as he can cultivate the image of being the candidate fighting against the madness while Biden and Harris stand stoically as the candidates willing to legitimize the mob.
House financial services chair Maxine Waters and Senator Elizabeth Warren have introduced the Federal Reserve Racial and Economic Equity Act. This legislation directs the Federal Reserve to eliminate racial disparities in income, employment, wealth, and access to credit.
Eliminating racial disparities in access to credit is code for forcing banks and other financial institutions to approve loans based on the applicants’ race, instead of based on their income and credit history. Overlooking poor credit history or income below what would normally be required to qualify for a loan results in individuals ending up with ruinous debt. These individuals will end up losing their homes, cars, or businesses, because banks disregarded sound lending practices in an effort to show they are meeting race-based requirements.
Forcing banks to make loans based on political considerations damages the economy by misallocating resources. This reduces economic growth and inflicts more pain on lower-income Americans.
The Carter-era Community Reinvestment Act has already shown what happens when the government forces banks to give loans to unqualified borrowers. This law played a significant role in the housing boom and subsequent economic meltdown. The Federal Reserve Racial and Economic Equity Act will be the Community Reinvestment Act on steroids.
This legislation also requires the Fed to shape monetary policy with an eye toward eliminating racial disparities. This adds a third mandate to the Fed’s current “dual mandate” of promoting a stable dollar and full employment.
Federal Reserve chair Jerome Powell has already publicly committed to using racial disparities as an excuse to continue the Fed’s current policy of perpetual money creation. Since inflation occurs whenever the Fed creates new money, Powell and his supporters want a policy of never-ending inflation.
Supporters of this scheme say that inflation raises wages and creates new job opportunities for those at the bottom of the economic ladder. However, these wage gains are illusory, as wages rarely, if ever, increase as much as prices. So, workers’ real standard of living declines even as their nominal income increases. By contrast, those at the top of the income ladder tend to benefit from inflation, as they receive the new money—and thus an increase in purchasing power—before the Fed’s actions cause a general rise in the price level. The damage done by inflation is hidden and regressive, which is part of why the inflation tax is the most insidious of all taxes.
When the Fed creates new money, it distorts the market signals sent by interest rates, which are the price of money. This leads to a bubble. Many people who find well-paying jobs in bubble industries will lose those jobs when the bubble inevitably bursts. Many of these workers, and others, will struggle because of debt they incurred because they listened to “experts” who said the boom would never end.
The Federal Reserve’s manipulation of the money supply lowers the dollar’s value, creates a boom-and-bust business cycle, facilitates the rise of the welfare-warfare state, and enriches the elites, while impoverishing people in the middle and lower classes. Progressives who want to advance the well-being of people in the middle and lower classes should stop attacking free markets and join libertarians in seeking to restore a sound monetary policy, The first step is to let the people know the full truth about the central bank by passing the Audit the Fed Bill. Once the truth about the Fed is exposed, a critical mass of people will join the liberty movement and force Congress to end the Fed’s money monopoly.
In recent weeks, we've been keeping an eye on weekly total deaths as they are reported by the Centers for Disease Control and Prevention (CDC). Weekly deaths—as opposed to COVID-19 death totals—provide some needed context. This is important, since we now know that doctors and health administrators are encouraged to be—in the words of Deborah Birx—"liberal" with counting COVID-19 deaths.
This week I'm looking at week 16 (the week ending April 18). The CDC says that week 17 data is "100% complete" but experience suggests that it will still be a week or two before we have 90 percent or so of the total.
Even week 16 will continue to adjust upward, but further large adjustments are unlikely at this point. These numbers are CDC estimates.
Looking at the data we do have, there were 67,059 total deaths in the US during the week ending April 18 (week 16). That's up 24 percent (or 13,206 deaths) over the week 16 average (53,852) for 2017–19. Using the average for 2017–19 as the baseline, "excess deaths" number about 13,000 or 0.004 percent of the US population. Interestingly, so far this year, only week 15 (the week ending April 11) has exceeded the total mortality for week 2 of 2018, which was 67,295. The 2017–18 season was a very bad flu year according to the CDC (week 1 is on the left in blue and week 16 is on the right in yellow for each year):
A large portion of this continues to come from New York State. In New York, the week 16 total was 4,056 deaths, which was 2,083 above the 2017–19 average of 1,972. So, about one-sixth of all excess death in week 16 came from New York. Deaths were up 105 percent over the average for week 16, with excess deaths at more than 2,000 for week 16:
Week 15 (the week ending April 11) may have been the peak week, if we assume COVID-19 was the driving factor in total deaths that week. Worldometer data suggests that COVID-19 deaths peaked the week ending April 11 and have fallen since then.
To offer an example of another large state, we can also look at Florida. Florida has not seen nearly the surge in total deaths that we've seen in New York or nationwide.
For week 16, total deaths in Florida were only up 8.4 percent (or 331 deaths) over the 2017–19 average for the week.
On the list of things that the government should not do, there must be a spot for the $750 billion corporate bond buying that is slated to begin this month. Under the Primary Market Corporate Credit Facility (PMCCF) and the Secondary Market Corporate Credit Facility (SMCCF), the Fed will lend money to the US government, which will make the appropriate bond purchases. Whether the Treasury will enlist the help of the best bond traders from Wall Street to actively trade in the market or whether a simple buy-and-hold strategy will be employed has yet to be seen. But this is what we know from this week’s press release, courtesy of the New York Fed:
the SMCCF is expected to begin purchasing eligible ETFs [exchange-traded funds] in early May. The PMCCF is expected to become operational and the SMCCF is expected to begin purchasing eligible corporate bonds soon thereafter.
Per the Federal Reserve, the PMCCF program is supposed to “provide companies access to credit so that they are better able to maintain business operations and capacity during the period of dislocations related to the pandemic,” while the SMCCF program is designed to “support credit to employers by providing liquidity to the market for outstanding corporate bonds.” These explanations sound both nebulous and temporary, so we will continue to monitor their development.
There are consequences to having a government buy and ultimately sell corporate bonds, such as artificially increasing bond prices, increasing the money supply, and effectively subsidizing certain corporations at the expense of taxpayers. An exhaustive list would be a laborious attempt to show what many policymakers appear not to know. Although it is important to factor in the immediate consequences, we must also consider one very important question: When will this end for good?
Whether or not the bonds are repaid or the securities successfully traded is not as important as the fact that once the program starts, it could become a permanent monetary tool for the Fed. Even worse, if the program is considered a success, it may lead to a wider acceptance of government ownership of other assets to be funded by Fed lending facilities.
To gain insight into these asset programs’ potential future, we can look at the European Union, whose central bank interventionism is more advanced. On Tuesday the German Federal Constitutional Court ruled that the European Central Bank (ECB) has three months to carry out a “proportionality assessment” of its now €2 trillion public bond program, known as the Public Sector Purchase Programme (PSPP), which began in 2015. Upon review of the assessment, the German court may block the ECB from buying German bonds due to a potential breach in the constitutionality of the asset program. In what can serve as a sign of things to come, the court said that:
the PSPP lowers general interest rates, it allows economically unviable companies to stay on the market. Finally, the longer the programme continues and the more its total volume increases, the greater the risk that the Eurosystem becomes dependent on Member State politics as it can no longer simply terminate and undo the programme without jeopardising the stability of the monetary union.
Even more inspiring than the ruling is the fact that the complaint was originated, as the Financial Times noted, by 1,750 people, led by German economists and legal professors!
Considering how many economic and legal professors there are in America, one would think that a significant number of them would consistently challenge the Fed and the government on issues such as multitrillion-dollar bailout programs, or at least make a concerted effort to enlighten the public on the government’s anticapitalist endeavors. Sadly, there seems to be little desire for the “experts” to bring this to the public’s attention, even though the public is liable to pay for these programs without ever consenting to them. If not academia, who will stand up against these borderline unconstitutional actions, which are nearly impossible to wind down once they begin?
In a world where the Left has declared everything from abortion to social media to be a human right, it is disheartening, to say the least, that so many who think of themselves as "progressive" have embraced wholesale violations of real human rights: namely, the rights to seek employment, to freely assemble, and to exercise one's religion.
The ban on searching for employment is the most damaging in its immediate effects, and the war against this right looks something like this: in the name of preventing the spread of disease, civil governments have taken to issuing decrees—in many cases without any sort of legal process that allows for appeal or public debate—shutting down businesses and prohibiting the free exercise of one's right to seek employment.
Why Looking for Work Is a Basic Human Right
In other words, individuals have been prohibited from entering into peaceful voluntary agreements with others to sell their labor in exchange for wages. For those who earn a living through independent contracting or selling goods and services, the effect is the same: commerce with others is forbidden, with the result being impoverishment and a loss of one's income.
In the American context, this is violation of several rights outlined in the Bill of Rights, most especially the property rights outlined in the Fifth Amendment. To be cut off from one's own labor and one's own right to enter into contracts is fundamentally a destruction of the basic right to control one's own property. But, of course, these rights are not specifically American. All human beings have these rights, whether recognized by government officials or not. A farm worker in Tanzania has these rights just as much as an insurance agent in Baltimore. To ignore these rights is no less backward than ignoring rights to free speech or the right to not be enslaved. Any governmental attempt to seize property in this way requires—morally speaking—due process.
The Inequality of Shutdowns
Those in favor of lockdowns and impoverishing millions insist that there is no other way. Unless we outlaw employment for millions, we are told, the death toll will be unacceptable. Of course, when pressed for what death toll is "acceptable," no answer is given. Is it six hundred thousand (the number who die from cancer in the US each year)? Sixty thousand (the number who typically die in the US from flu and pneumonia each year)? Some lesser number? One? This figure remains a great mystery. We are only told that human rights are null and void until the "experts" decide otherwise.
Politicians still, begrudgingly, allow some people to exercise their right to work for a living. These people are the ones in so-called essential lines of work. Which types of work are essential? Well, that's up to the arbitrary whims of the state governors who now rule by decree (and collect six-figure paychecks while cosigning others to unemployment). In some places, hardware stores are "essential." In other places, they are not. In some places, diagnostic procedures to find brain tumors are deemed "elective" and therefore verboten. In other places they're allowed.
Should private citizens violate these many prohibitions and limitations, the result is anything but voluntary: the state uses force (or the threat of force) to impose fines, jail time, and to revoke business licenses.
The result, of course, is mass unemployment and the loss of access to a wide variety of goods and services, including housing, transportation, education, insurance, and even basic necessities like food. The newly and forcibly unemployed are expected to be content to sit at home, go on welfare, prepare for bankruptcy, and watch their children go hungry.
Meanwhile, those who complain about the regime's callous and immoral disregard of human rights are denounced by the ruling (and very well-paid) technocrats.
Some especially out-of-touch pro-shutdown "COVID Warriors" rationalize it all by insisting that these prohibitions on earning a living are, as Dr. Anthony Fauci claims, mere inconveniences. It's easy to see why someone like Fauci might think this way. His government salary is $400,000 dollars (not including whatever lucrative contract work he has on the side), and there is little risk he'll be missing any mortgage payments any time soon.
Similarly, lots of white-collar "creative class" types who can work from home delight in lecturing other people about "staying home" and "flattening the curve" while working-class people who work in fields that require human interaction are just out of luck. Some simply can't afford to give up their incomes and wait around for small, inadequate government checks that may take weeks to arrive. At some point in the near future those checks will stop coming, an even in places where the state plans to ramp up welfare spending, the fact is a community must produce wealth before wealth can be distributed. An economy that is in decline will simply be redistributing a smaller and smaller pool of resources.
Not surprisingly, some business owners and contractors will try to open their businesses anyway. And some workers will still try to provide services in the marketplace—which is now a black market thanks to government decree. In these cases, the police—i.e., more government employees with safe jobs and hefty paychecks—intervene and arrest business owners, just to make sure the destitute aren't allowed to bring in a few bucks.
Those who support this systematic use of violence and harassment of peaceful citizens insist they have the moral high ground, and the crusaders for public health contend that they are are the only ones who care about human life while those execrable working-class barbers, hygienists, and front desk receptionists care only about filthy lucre.
The Costs of Unemployment and Isolation
In the real world, however, cutting people off from earning a living comes with many costs indeed. There is a growing mountain of data showing that unemployment leads to more deaths via drug abuse, suicide, and stroke. Other side effects are even more grim, such as the increase in domestic violence and child abuse recorded during these "stay at home" orders. Forcing people into isolation comes with real physchological effects that shorten lives.
But ignoring this reality is to be expected of those who have adopted the tunnel vision of the busybody and the public moralist. In the minds of the COVID Warriors, all that matters is the lives of the people the COVID Warriors have deemed important. Everyone else's life and well-being is of lesser importance. If there's more suicide and more child abuse, that's too bad, but it was all "worth it."
It should not surprise us that this war on human rights—led largely by smug intellectuals, billionaires, and politicians—has come wrapped in the mantle of moral supremacy. But such is the usual m.o. of those who view human rights as an inconvenient impediment to one's agenda. The Soviets insisted that they represented "the workers" and a revolution in favor of a more just world. The slave drivers of the Old South equated slavery with civilization itself. The absolutist monarchs of Renaissance Europe told themselves they were defenders of culture and God and national "honor." Then, as now, moral crusaders justified the destruction of dissidents, traitors, and anyone else who refused to repeat some variation of the slogan "We're all in this together."