Power & Market

Your Check Is In the Mail: How "Stimulus" Checks Are Spent

04/27/2021Robert Aro

More than $379 billion has been sent out across the country in the form of stimulus checks over the last two months. CNBC reported on Thursday:

A sixth batch of $1,400 stimulus checks has gone out, bringing the total number of payments sent to date to about 161 million.

One report, by the Peter G. Peterson Foundation noted that if we combine the last three stimulus bills:

The federal government has provided over $850 billion of direct payments to taxpayers.

It raises an interesting question: What did everyone do with their stimulus money?

NBC attempted to answer this question. Yet, in doing so illustrated the problem with the question and policy itself, finding:

the majority of that money continues to be spent on groceries, rent and other monthly bills…

Vague. So here are more details:

nonessential spending (13 percent), paying down debt (32 percent) and investing (11 percent) since January, the number one reason for stimulus spending among all income brackets is monthly bills (45 percent).

It’s curious to see what spending is considered essential and which is not. Still, the bigger issue is the idea spending can be adequately tracked in order to illustrate where the stimulus checks have gone.

But there’s an interesting thing about money: once received or added to one’s existing supply of savings (or credit), how can one allocate where the newly received money goes afterwards? Does it matter if the person has savings or not? Consider two scenarios:

Someone with $5,000 in their checking account receives a $1,400 stimulus check. They immediately purchase a hunting rifle for $1,400 then invest $1,400 in the stock market. After receipt of the check and the two purchases, they now have $3,600 in their account. Was the stimulus check used for savings, as it was saved in the checking account first? Did it go to the firearm as it was the first purchase made after receipt of funds? Or was it used to invest in the stock market?

And what if someone is in a debt position? Consider the same scenario above, except they had $5,000 balance owing on their line of credit, and stocks and the rifle are bought in the reverse order. Do we say the stimulus check went to pay down the line of credit (debt), the stocks (investing), or the rifle (nonessential or essential spending)?

There are various combinations which involved the timing of payments and whether the check contributed to existing savings or reduction of debt; but it illustrates the difficulty in allocating the whereabouts of the stimulus checks.

In addition to being unable to allocate the funds, we cannot prove the checks were a “good idea,” for the country. Any such criteria would be arbitrarily based on the value judgments of the decider. Nor can we say nearly $1 trillion in stimulus payment to households was “the correct” amount, as it could have easily been $500 million or $2 trillion. Since stimulus checks are devoid of economic calculation, any stimulus amount is equally as valid as any other. 

One might prefer if exactly zero dollars of stimulus money was given. That would have saved another $1 trillion off the national debt and reduced future interest expenses. It would also mean less unpredictable price distortion in the market as the 161 million recipients would not have to decide whether they should spend or save this newly created money.

But what does it matter anyway? Per NBC:

There may be hope on the horizon for the millions who continue to struggle financially: Almost two dozen senators have urged the Biden administration to include recurring relief payments…

Unfortunately, when it comes to economic policy matters, it seems economics continues to take a back seat to policy matters.

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YouTube Attempts to Silence the Mises Institute

11/25/2020Jeff Deist

YouTube, the dominant video platform owned by Google, decided yesterday to remove a Mises Institute video. This decision apparently lasts for all eternity, cannot be appealed to an actual human, and comes with this friendly admonition: "Because it’s the first time, this is just a warning. If it happens again, your channel will get a strike and you won’t be able to do things like upload, post, or live stream for 1 week." 

The video, a talk by Tom Woods titled "The Covid Cult" with more than 1.5 million views, was recorded at our live event in Texas two weeks ago. It offered challenges to the official narrative surrounding the coronavirus, particularly with respect to mask mandates. Woods's talk featured several charts showing rises in Covid "cases" across multiple cities and countries not long after imposing mask rules, demonstrating how such rules apparently have little effect on slowing transmission of the virus.

YouTube

The speech was nothing less than a heartfelt tour de force against the terrible lockdowns and pseudoscience plaguing the debate over Covid, and a call to reexamine tradeoffs and priorities. It was, as you might imagine, a mix of unassailable data combined with our friend Tom's strong prescription for liberty and personal choice rather than centralized state edicts.

In other words, YouTube had no earthly business removing it. This kind of discourse seems to me the best and highest use for YouTube, its most important function.  

"Big Digital," as Professor Michael Rectenwald terms tech companies, have become "governmentalities": supposedly private enterprises turned into instruments of state power and state narratives. This sordid process is different for each company, (some are more complicit than others, a few are heroically non-compliant) but it involves a mix of early start-up funding; connections and contracts with state agencies, particularly relating to defense and surveillance; and propaganda campaigns in service of state narratives. Rectenwald explains this phenomenon in his own recent talk titled "The Google Election":

In short, Google, Facebook and others are not strictly private sector entities; they are governmentalities in the sense that I have given to the term. They are extensions and apparatuses of the state. Furthermore, these platforms are governmentalities with a particular interest in the growth and extension of governmentality itself. This includes championing every kind of “subordinated” and newly created identity class that they can find or create, because such “endangered” categories require state acknowledgement and protection. Thus, the state’s circumference continues to expand. Big Digital is partial to the interests and growth of the state. It not only does business with statists but also shares their values. This helps makes sense of its leftist bent and their preference for the deep state Democrats. Leftism is statism.

We encourage readers to consider the entirety of Rectenwald's talk, and his sobering book Google Archipelago for his thorough treatment of the facts and realities behind tech companies and the US state. This is not alarmism or conspiracies, but documented examples of how Google, Facebook, YouTube, Twitter, Instagram, LinkedIn and others actively participate—including financially—in a melding of corporate and state power. 

This, then, is real fascism. Big Digital—what writer Ilana Mercer calls "Deep Tech"— is not a collection of private companies in the sense we think of such. They are partners of the federal government, committed to ideological service as part and parcel of their own bottom line.

Thankfully,  the sneering call to "build your own platforms" is being answered. Companies like Bitchute and LBRY (its video platform is Odysee) continue to host Mises Institute content, and promise to continue doing so. In fact, you can view Dr. Woods's forbidden talk at those respective source here and here.

Truth tellers matter more than ever. It's time for our own institutions and platforms, which is precisely why the Mises Institute exists.

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You Can't Defund the Police without Defunding the Government

06/16/2020Todd Seavey

The slogan Defund the Police sounds milder than the previously popular F— the Police. Though viewed as radical at the moment, the newer slogan might turn out to be only an intermediate step on a path to some tepid reform plan such as “Modest Budget Cuts for the Police in the Next Fiscal Year.”

You misunderstand if you think I’m unwilling to think more radically than that. But even if you’re a fellow libertarian, the odds are that you’re easily confused by radical resistance strategies, confused about which ones are most compatible with liberty.

For instance, those libertarians who’ve lately jumped on the fashionably left-liberal bandwagon on various “intersectional” and “ethnic sensitivity” issues are usually, in my experience, the same ones who would’ve fainted a decade or so earlier if you had told them, logically enough, that you thought President Lincoln did some terrible, warlike things but that you also thought John Brown’s rebellion, in which slaves rose up and slaughtered slave owners, was completely justified.

This simple extrapolation from the principle of self-defense is one that I’ve found that the unfashionable, un-PC “right-wing” libertarians, including the ones at the Mises Institute, have usually been happy to make, as they should be. (Mises Institute cofounder Murray Rothbard even had a soft spot for some Latin American leftist revolutionary groups, because they were fighting coercive, essentially aristocratic landowners.)

So, let’s hear no nonsense about how those libertarians who condemn recent riots and looting in harsh terms must be racist or apathetic about police brutality. You can denounce moblike brigandage as an imminent threat to civilization and simultaneously denounce the routine abuses by, as they say, “the gang in blue.”

Minorities will likely be hit hardest by the looting’s economic aftermath, since it’s their neighborhoods burning. When that becomes apparent, recall all the evil, sociopathic leftists you know who kept saying, “It’s only property. Property can be replaced.” What arrogant, vicious, entitled little quasi-Marxist zombies they are. But I condemned them in an earlier column.

The corollary point is that there may be times when there’s more reason to fear the looters and other criminals than the police, but saying so doesn’t mean ruling out radical, more long-term changes in policing. All government is violence, telling people to do things they don’t want to do and preventing them from doing things that they do want to do. That violence should end, and police—except in those narrowly defined instances when they prevent greater violence, as from rapists and burglars—are the point of the evil spear that is the state.

If people really want to “defund the police,” I’m all for it—but you’d better do this the right way.

That means recognizing that people, all people, will still have a right to defend themselves against violence and theft. In a postpolice world, there should be no pretense that one’s right to carry a gun can be restricted. There should be no limit on the right to form private, voluntary police services, from militias to arbitration firms, so long as they in turn respect others’ rights. People will still need to settle disputes, after all, and I’d hope that your desire if you say “defund the police” isn’t to just leave innocents at the mercy of violent people, who inevitably will still exist.

Some people chanting that mantra—even one on the Minneapolis City Council, in the case of Lisa Bender under questioning by CNN—seem to have thought no farther than the defunding. Asked what happens if someone’s home is attacked in the night after the police are defunded, her main reply was that that question comes from a place of “privilege.” Well, be that as it may, the practical problem is not going to go away.

Nor do the mountains of articles and books from anticop and antiprison leftists purporting to answer the question really seem to get the job done, despite the exasperation and anger you can evoke from the readers of such materials by suggesting that they don’t have good answers. They’ll use the word “community.” And they usually seem to imply that people are going to keep paying their taxes even if they can no longer be put in jail for failure to do so, since there seem to be many tax-funded programs that the activists like more than they like police departments. Good luck with that.

But the truth is that all government programs and all laws cease to be enforceable if police truly go away—and that’s fine with me (aside from wanting laws against assault, theft, and fraud). Just recognize that the practical answers about how to provide services, including eternally necessary police services, after the Great Defunding will have to come from libertarian thinking (specifically anarcho-capitalist thinking) and not from the big government–assuming, tax-sucking left.

No, not even from left anarchists, who look down their noses at anarcho-capitalists but are quickly reduced to incoherence if asked for details about how they’ll spontaneously yet collectively deal with dissenters and violence—except by making rules that recognize people’s right to defend their bodies and property, which sound like anarcho-capitalist laws to me.

Say goodbye, then, to the looters, the government cops, the welfare state, the violent street gangs, the tax-funded military, and the whole coercive system. But don’t say hello to some ludicrous socialist fantasy in which government is somehow still there to cater to you. Say hello to efficient private security guards and all the other wonders the market has to offer when it’s being neither regulated nor burned down.

This article originally appeared at Splice Today.

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Yes, College Professors Are Almost All Left-Wing

01/21/2020Jeff Deist

Sean Stevens of Heterodox Academy and Professor Mitchell Langbert of Brooklyn College have a new article published by the National Association of Scholars. They examined professors' self-identified political views, party affiliation, voter registrations, and FEC (Federal Election Commission) records of political donations. Their research appears to confirm that college professors in fact skew overwhelmingly left-wing in their political views, even more than many of us thought. If they are even mostly correct, the (left) liberal professor stereotype is absolutely grounded in reality rather than caricature. 

Professor Langbert writes:

Sean Stevens and I have been working on a study of 12,372 professors in the two leading private and two leading public colleges in 31 states (incl. DC) that make registration public (mostly closed-primary states).  The National Association of Scholars has posted our initial findings on their blog. We cross-checked the registration against the political donations.  For party registration, we find a D:R ratio of 8.5:1, which varies by rank of institution and region.  For federal donations (from the FEC data base) we find a D:R ratio of 95:1, with only 22 Republican donors (compared to 2,081 Democratic donors) out of 12,372 professors.  Federal donations among all categories of party registration, including Republican, favor the Democrats: D:R donation ratios for Democratic-registered professors are 251:1; for Republican-registered professors 4.6:1; for minor-party-registered professors 10:0; for unaffiliated professors 50:1; for non-registered professors 105:1. We include a school-by-school table that facilitates comparisons.

These ongoing revelations about the reality of higher education in the US should give pause to every parent writing big checks for elite school tuition so Johnny or Jenny can fulfill their dreams. Think twice before blindly sending your children (or yourself) to ideological indoctrination centers. A university education may well be worthwhile, but only if students and parents alike have their eyes wide open.

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You'll Soon Be 3-D Printing Guns at Home

07/26/2018Ryan McMaken

Remember Cody Wilson? In 2013, he's the guy who successfully tested a fully-3-D-printed gun. Shortly thereafter, he posted information on how to make the guns online.

Shortly after that, as many predicted, the federal government took steps to shut the whole thing down.

Recent developments, however, mean that the guns and plans on how to make them, will soon be seeing the light of day again.

Last week, Wired reported:

Two months ago, the Department of Justice quietly offered Wilson a settlement to end a lawsuit he and a group of co-plaintiffs have pursued since 2015 against the United States government . Wilson and his team of lawyers focused their legal argument on a free speech claim: They pointed out that by forbidding Wilson from posting his 3-D-printable data, the State Department was not only violating his right to bear arms but his right to freely share information. By blurring the line between a gun and a digital file, Wilson had also successfully blurred the lines between the Second Amendment and the First.

The Department of Justice's surprising settlement, confirmed in court documents earlier this month, essentially surrenders to that argument. It promises to change the export control rules surrounding any firearm below .50 caliber—with a few exceptions like fully automatic weapons and rare gun designs that use caseless ammunition—and move their regulation to the Commerce Department, which won't try to police technical data about the guns posted on the public internet. In the meantime, it gives Wilson a unique license to publish data about those weapons anywhere he chooses.

This isn't exactly a total victory for laissez-faire, of course. The federal government is hardly abandoning any attempts to regulate firearms — including those created by Wilson. But, the recent court settlement does signal the political and legal realities that make it difficult for the federal government to arbitrarily decide what sort of information is legal to share.

The effect of the settlement will soon be felt, it seems:

Now Wilson is making up for lost time. Later this month, he and the nonprofit he founded, Defense Distributed, are relaunching their website Defcad.com as a repository of firearm blueprints they've been privately creating and collecting, from the original one-shot 3-D-printable pistol he fired in 2013 to AR-15 frames and more exotic DIY semi-automatic weapons. The relaunched site will be open to user contributions, too; Wilson hopes it will soon serve as a searchable, user-generated database of practically any firearm imaginable.

All of that will be available to anyone anywhere in the world with an uncensored internet connection, to download, alter, remix, and fabricate into lethal weapons with tools like 3-D printers and computer-controlled milling machines. “We’re doing the encyclopedic work of collecting this data and putting it into the commons,” Wilson says. “What’s about to happen is a Cambrian explosion of the digital content related to firearms.” He intends that database, and the inexorable evolution of homemade weapons it helps make possible, to serve as a kind of bulwark against all future gun control, demonstrating its futility by making access to weapons as ubiquitous as the internet.

The triumphalist response to all this, voiced by some libertarians is that gun control will "end" as soon as Wilson's operation goes online. They're not totally wrong, although history suggests we're really just about to head down a long road of quasi-legality and court battles over these sorts of weapons. 

After all, the US government has not said it has no role in regulating guns. It still says it can prohibit publication of information on how to make fully automatic weapons, for example.

Nevertheless, the court settlement does suggest the federal government, for now, has been forced to admit that it is at least somewhat constrained in just how much it can prohibit the spread of information — even if that information involves the manufacture of firearms.

Over the next decade as this issue further works its way through the courts and legislatures — as is sure to happen — we will nevertheless see here a true decentralization of both the information and the tools necessary to make guns.

Historically, this has always posed a threat to states, and decentralized distribution and ownership of weapons has long been a hallmark of guerrilla warfare.

RELATED: When Guerrilla Warfare Can Succeed — And When It Will Fail by Ryan McMaken

The US state, of course, is as well aware as any state that the ability to manufacture guns at home — at relatively low cost — does indeed change the landscape.

But what will the state do in response? States, to be successful, must be able to maintain a monopoly on the means of coercion. The US state is no different, and it will be interesting to see what steps the US government takes to restrict the ability to crank out guns with a 3-D printer. Will the US government simply tell itself that it can easily overpower any challenge to its monopoly that might arise from the proliferation of homemade guns? After all, it's still not possible to churn out tanks or rocket launchers or Apache helicopters with any equipment one might have in one's basement.

To some extent, this strategy of relying on better firepower will depend partially on just how much gun ownership might proliferate in an age of DIY guns. After all, it's easy enough the deal with a small number of angry gunmen with superior firepower. This advantage becomes smaller, however, the more gun owners there are. Even today, when many types of guns can still be easily bought, only 42 percent of Americans say they live in a home with guns. I happen to be of the opinion that these numbers tend to understate the probable real ownership rate. But by how much? Even if the 42-percent figure gets it wrong by 10 percent, we're still talking about only half the population with an apparent interest in having guns. And even fewer of these are likely skilled in the usage of firearms. Ownership rates, are important, though, because someone who owns guns is less likely to support efforts to confiscate them. 

The fact that guns are easy to come by,however, doesn't mean every one will want one. Of course, things could change substantially in a crisis situation that would significantly undermine public opinions of the state. This could arise from a serious economic crisis or from a surge in crime and civil unrest. Or all of the above. Then we might see a lot more interest in private gun ownership.

And Cody Wilson's gun operation might make it much harder for governments to assert control in such a situation.

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You May Run From It, But Disruption Is Going to Occur All the Same

07/24/2018Per Bylund

Elon Musk has a reputation for blazing trails. Whether it's electric cars, a cave rescue or space travel, the billionaire business mogul has no problem doing things his own way.

Education is no exception. Since 2014, Musk has operated Ad Astra, a nonprofit school at SpaceX headquarters. Students explore everything from AI to robotics without any set class structures or grades. They can even opt out of subjects they don't enjoy.

This sort of innovation is, sadly, absent from many areas of our education system. Education technology companies have transformed classroom experiences, but layers of bureaucracy have made it a challenge to explore truly new and innovative methods of teaching students. As is the case in most industries, it’s easier to rely on the way we’ve always done things than to try to reinvent the wheel.

When entrepreneurs observe this sort of static situation, they begin to dream up ways they might be able to disrupt a marketplace. A lack of innovation presents an incredible opportunity for individuals who are able to see things differently.

Entrepreneurs will find ways to disrupt every industry -- it’s simply a matter of time. The lingering question is whether organizations will embrace the evolution or fight tooth and nail to avoid change. Disruption might be an inevitability, but industries that stubbornly stick to the old way of doing things are only making the process more painful.

Read the full article at Entrepreneur.
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Yellen Raises Interest Rates One Last Time

12/13/2017Tho Bishop

​Today Janet Yellen announced that the Federal Reserve is following through with its planned third rate, moving the effective federal funds rate to 1.25-1.5%. This move was widely expected, and considered to be “priced in”. As I noted in October, one of the most surprising winners of Trump’s presidency has been Yellen. Prior to 2017, Yellen’s Fed had consistently whiffed on its projections, eliminating the usefulness of its forward guidance.

As far as the rate hike itself goes, it’s worth noting that the Federal funds rate remains historically low, on par with Greenspan’s policies the mid-2000s.

While today was Yellen’s last FOMC meeting, we should expect to see little change in ideology under Jay Taylor

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Yellen Announces She Will Leave Fed Next Year

11/20/2017Tho Bishop

Today Janet Yellen announced that she will be leave the Fed entirely when Jay Powell is confirmed as the next Federal Reserve Chairman, she had the option of staying on as a governor. It was widely expected that Yellen would stay on, though there was some thought that her ideological similarity with Powell made it possible she could have stayed on the Federal Reserve Board.

This move gives Trump yet another spot to fill at the Fed, which will make five total during his presidency. He filled one of those spots earlier this year when Randal Quarles, a former Bush Treasury official, was confirmed by the Senate. 

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