I read the other day a commentary regarding Justice Roberts divining what was overtly intended to be a “penalty,” to actually be a tax. As a result, he found an interpretation for the constitutionality of the Affordable Care Act (ACA). It’s not a mandate, only the tax to pay for it is. So, you’re free to buy private health insurance but you are required to pay for the government plan regardless. Sounds a bit like selecting a non-government school for your children. Which brings up the idea of a universal health care tax credit, but I digress. In the context of the aforementioned commentary, one person vomited up the bromides that all one needs to do in this whole matter is to “follow the money” to find out who “they” are. Ostensibly, a very small cabal of characters responsible for all of our ills (including ACA); if we follow this nondescript long trail of money we will eventually discover who the cabal actually is, and find it was a group of greedy, money hungry, cats who stood to make fortunes. Read the rest of this entry »
The 20th century’s most important philosopher, Ayn Rand, advocated for a revolutionary philosophical system she called Objectivism. It is no understatement to note that even today it is widely misunderstood, often misquoted, and all too frequently, patently, and purposefully mis-stated. In short, it is the incredibly visionary and liberating world-view that a person ought to always operate under the premise of rational self-interest. Meaning that one should use one’s best judgement in the achievement of life-serving, long range, values: those things one works to gain and keep that are necessary for the achievement of happiness.
And make no mistake about it, her philosophical system was what was missing in the brilliant work of the Founding Fathers. It is what gives fundamental power to the political system they envisioned. Had they had her then, we would not have Obama nor would we have had the incredible rise of the interventionist state we all are force to live under today. Her admonition was to always keep the long-range in view, and never commit a sacrifice – never “surrender a greater value for the sake of a lesser one”. To Rand this was the essence of morality, and as such a profound virtue.
Today is the anniversary of Ms Rand’s birthday, she would have been 107 years old today.. So, as Harry Binswanger writes:
“February 2nd is the birthday of Ayn Rand, the author of Atlas Shrugged and The Fountainhead. Ayn Rand developed and defended Objectivism, a philosophy that advocates “rational selfishness.”
To celebrate Randsday, you do something not done on any other holiday: you give yourself a present. Randsday is for getting that longed-for luxury you ordinarily would not buy for yourself. Or for doing that long-postponed, self-pampering activity you cannot seem to fit into your chore-packed schedule.
Randsday is for reminding ourselves that pleasure is an actual need, a psychological requirement for a human consciousness. For man, motivation, energy, enthusiasm are not givens. Pathological depression is not only possible but rampant in our duty-preaching, self-denigrating culture. The alternative is not short-range, superficial “fun,” but real, self-rewarding pleasure. On Randsday, if you do something that you ordinarily would think of as “fun,” you do it on a different premise and with a deeper meaning: that you need pleasure, you are entitled to it, and that the purpose and justification of your existence is: getting what you want—what you really want, with full consciousness and dedication.”
Let’s hope it won’t take another 100 years to fully grasp and embrace her profoundly moral philosophical system!
Some time ago I received a newsletter that stated the following as part of a defense of capitalism:
“The capitalist system is messy, imperfect, and does need constraints to enforce contracts impartially, to protect individuals, the weak from the strong and it requires the rule of law to make it work. While the rule of law is not always perfect, the rule of the central planner is subjective and is subject to more corruption. This makes it more unfair to more people.”
Clearly, the gang hanging out doing the Occupy Wall Street shuffle not only believe the above but suspect and decry far far worse of capitalism. Indeed, these folks seem to be implicitly and in most cases tacitly demanding that capitalism either be “perfect,” or utterly abandoned. This is not all too different from the sustainability crowd who argues along the same thesis, if it cannot be sustained it must be untouchable; both views demonstrate abject moral depravity.
I would argue, and I believe it is no small point, that the concept of “perfection” is misplaced in any discussion of the merits of capitalism. In fact, I would take it one step further to suggest that those who have an overt anti-capitalist worldview have worked very hard to implant this notion. A notion that is almost reflexively adopted by those who contend capitalism is preferable, yet begin by conceding this point of imperfection to those who have a diametric worldview. All these defenders are left with then is an argument based upon shades of gray or degrees, and not absolutes.
I took a moment recently to read Bob Cesca’s Huffington Post article. Cesca is no different than many who are taking the oil spill as an opportunity for context dropping smears of capitalism and capitalists; the economic system and the risk takers within that provide them the very means to spew their socialist claptrap, not to mention create the highest standard of living in the history of mankind. Such pot shots at capitalism are clearly not helping matters.
The degree of myopic, out of context, drivel spewed by Cesca seemed to know no end, as he apparently has little or no knowledge of history (one wonders if he ever heard of the Santa Barbara spill of 1969, and what ensued on the heels of reaction to it). Mr. Cesca would like us all to believe, just as the proponents of government controlled health care, that there IS a “free market”…and that this “free market” is the root cause of the current disaster (just plug in one, it doesn’t seem to matter with this crowd). The same lame argument was made regarding the supposed 40 million people without health insurance, that it was the free market supposedly failing by virtue of the fact some people chose not to purchase health insurance, or simply could not afford the premium charges (let alone purchase care out of pocket). Ergo, it must be the free market, capitalism, that is to blame for this social injustice simply because in the present state providers of those services, and the insurance to pay for it, make an accounting profit. In the same convoluted out-of-context way energy companies are now being held up as poster children for the supposed failure of capitalism.
What is wrong with the Federal Reserve? Do we need a different approach? Robert Klein and George Reisman recently wrote an article for Barron’s entitled Central Problem: the Central Bank. While I wholeheartedly agree with the conclusion of the article, it seems to me a fair bit more needs to be said and explained in this matter..
You have heard it uttered over the years by mindless idealists of virtually every stripe that, “money is the root of all evil.” Alternatively, some will take a completely altruistic but similarly mindless stance by saying, flippantly, “it’s only money.” Personally, I make zero attempts to understand the irrational but, and although convoluted, there may be a “reason” some people say these things. What such an attitude or perspective reveals is utter confusion over what money is, fundamentally. To explain this, one needs to have a fundamental grasp of money.
To understand the state of money, one needs to have a basic understanding of its systematic implementation, known as a monetary regime. A monetary regime is any political jurisdiction’s (such as a sovereign nation) legal system of using some other means than barter to facilitate goods and services exchange. This definition also extends to goods and services exchanged between traders from other jurisdictions and those members of the subject jurisdiction. Given a division of labor premise where producers and consumers engage in specialization, yet need a variety of goods and services in order to survive, it makes zero sense, being a coffee bean roaster, to drive out to a farm with your beans (that you obtained by traveling to Costa Rica with a stock of sandals the plantation owner needed to trade locally for drying equipment) and trade for lamb parts so that you can take a leg of a lamb down to the grocery story and barter with the grocer for milk and eggs (who has all the beans he currently needs, but will trade for lamb). One can conjure up a myriad of illogical combinations and permutations of barter that would illustrate just how impossible life would be.
In fact, without some intermediary medium of exchange it should be rather obvious that the very division of labor we have come to rely upon, and which has allowed for light-year leaps in economic efficiency and productivity (and the resultant boom worldwide in standards of living), world-wide would grind to a halt tossing everyone into stark raving poverty and distress. There can be no doubt given the long view of history that is at our fingertips that even the factory worker, garbage collector, or postal mail carrier of today has at his or her disposal a realm of possibilities of action through this medium of exchange to live as a modern Renaissance man. The average worker today can afford both the time and the investment to live a life which the ancient Greeks thought only possible by a slave-owning aristocracy. This fact is due entirely to the economic efficiency brought to human existence by the theory of division of labor.
Therefore, instead of trading cattle parts for milk and eggs we use a device, money, which represents the specialized productivity embedded in the labor of the cattle rancher. When the cattle rancher goes to market, he exchanges his cattle for an amount of money (a medium of exchange) agreed upon either at the moment (on the spot), or a price guarantee agreed upon prior to delivery (futures). All others who, not raising cattle directly, desire it base the amount of money due the cattle rancher upon the current level of demand for beef. Moreover, all of those others in this simplified equation need to eat and consume many other goods and services in order to survive and to engage in similar other trades and transactions with others who themselves specialize in a myriad of goods and services. The sum total of all of this represents “the marketplace” of final goods, raw natural resources, commodities, and services. Very little would happen, as you can easily see, were it not for the ability for the division of labor specialists, in the face of the actual demand for the goods and services they provide, to produce anything unless they can quickly and easily exchange and keep this medium of exchange. Money and its equivalents is the oil in the crankcase of the division of labor engine. An engine which powers the vehicle of freedom and continuously increasing standards of living for humans – capitalism.
The cattle rancher, and the bean roaster, the butcher, baker and candlestick maker take that money only on the clear and unambiguous understanding that they will be able to exchange it for the product of the efforts and production of others who produce things they need and want. Money, then, is your claim upon the labor and work of the mind of others who also produce something, which is of value – of value to someone, somewhere. It is, by definition, the tool of exchange for the men and women of goodwill – it is, in fact, and profoundly, the root of all that is good. It allows for no fraud, and demands the best of our virtues particularly independence, productivity, and pride. In order for our virtues to be reflected in our trading, the mechanism used, the medium itself, must be virtuous. The medium of exchange itself must not be something that can be manipulated at whim, thereby causing its intrinsic value to change independently, or arbitrarily. Traders must be able to trust that when they give up their work (goods, services, etc.) for money the money itself will not loose its ability to hold the value they placed upon it. Therefore, it must be backed by an object whose intrinsic value cannot be subject to the whims of politics, the irrational wishes of the hedonist or the altruist, or the dictates of tyrants. Indeed, a division of labor society enabled by such a medium of exchange is a truly capitalistic society; it is inherently moral and virtuous. It is not the tool of the preachers, the teachers, or the politicians who claim it by mystical revelation, perceived need, or governmental coercion at the point of a gun. It is the fundamental tool of men and women of good faith, good will, and honesty who understand that man can only survive by the productive use of his rational mind and through the honest labor of his hands. The money you acquire, use, and hold is a tacit statement of your conviction that there are others who will not default on that conviction.
The fundamental keys for any such virtuous medium of exchange are that it must be uniformly established and accepted, defended by the rule of law, reliable, relatively scarce, cannot be counterfeited, and must be divisible into logical portions without destroying its fundamental value (each of ten pieces of a single unit, must be worth precisely 1/10th of the original single unit). Moreover, it must also be able to be stored (saved), and when retrieved have a predictable ability to once again facilitate trading and exchange at a level roughly equivalent to the value at the time of saving, adjusted (increased) for any lost value were it to have been used for other, immediate, productive use. In addition, it must be acceptable as a payment for debts when they come due (and the lender who is repaid after the loan period must not be placed in a worse position, in effect, again, a reflection of the time value of the medium). Lastly, as regards the relative scarcity of the medium, the increase in the supply of the medium must be a by-product, or reflection, of the general increase in productivity. This is so because if the medium were not relatively scarce, and not highly valued in and of itself, there would be a distinct tendency for its supply to increase more rapidly than the supply of other commodities; leading to each additional unit being worth relatively less, and therefore take more of them over short periods of time to purchase a fixed basket of goods and services, i.e., inflation.
The basis of a free society-the concepts of individual liberty and freedom-as outlined by not just this country’s foundational principles and documents, but in fact the whole concept of man’s inherent rights, is clearly understood to be optimized by one and only one social and economic system – capitalism. The hallmark of capitalism is the premise of personal (private) property and the inherent right to keep the fruits of ones labor (that in fact you own your own mind). The singular system which maximizes this historical and demonstrated truth is the division of labor enabled by a virtuous medium of exchange. Anything else, any movement away or apart from this enlightened view, I submit, becomes the root of all evil and a return to the primitive tribal mentality that characterized the dark ages. If you doubt this conclusion, please investigate its antithesis. In fact, just look around you! The financial calamity we have just (and are currently experiencing) gone through is the logical outcome of the degree we have moved away from sound money that traders can rely upon – what we presently have is not moral. Klein and Reisman conclude, as do I, that the madness of fiat currency must end. Such a conclusion stands the tests of logic and reason, as well as the demonstrated test over time.
My family has been here in America since the late 1600’s, I love my country and its foundational premise that government at all levels, particularly the federal level, is subordinated to the rights of the individual. Indeed, government at its best is singularly focused on the protection of those individual rights and that unique relation. This is opposed to the tyrannical regimes of the world that have taken it upon themselves to eliminate, or severely restrict, individual rights operating under the flawed notion of collective benefit or, worse, perceived need. That in this land individual rights and self determination trump perceived collective need thus allowing one the opportunity to prosper and to engage in true benevolence. Such is the hallmark and moral keystone of this great country. Yet, I am at an utter loss as to how any rational thinking individual, of any political party, who has any understanding of this unique American idea could possibly vote, as you have, to institute a legislative right to health insurance which turns all such virtue upside down.
You, sir, have voted for a bill which clearly flies in the face of The Constitution (Article 1, Section 8); If not its letter, clearly its unambiguous intention. As you ought to know, Article I, Section 8 establishes an important constitutional right to uniformity with regard to taxation and redistribution. This bill is an abomination with regard to uniformity as it clearly takes by force money from citizens of states such as Colorado, and uses it to pay for the Medicaid expenses of citizens of states such as Nebraska. You claim you do not approve of this, yet you voted for it. You cannot have it both ways. Moreover, this bill includes the requirement (subject to the threat of coercion) that citizens purchase health insurance, whether they need it, or want it. Such overt government intervention and strong arming is the antithesis of our founding principles as noted above for it clearly subordinates the rights of the individual to the state. I would expect this sort of interference by a totalitarian state, not a free country. How dare you vote for this monstrous violation of my rights as an individual and citizen!
Additionally, in your commentaries you have taken unfair and misleading pot shots at the insurance industry. You claim, by extension, that they are the root cause of the problem of the current “high cost” of health insurance and generally make them out to be some mystical boogie man. If what you were truly interested in was reducing this cost then perhaps you would have investigated why it is that insurance companies charge the rates they do. Had you done that, you would have discovered the reality that it is government regulations, anti-trust manipulations, required (mandated) coverage laws, portability restrictions, and tort law issues that impel insurers to charge what they do. And they do so in order to survive and employ the hundreds of thousands of dedicated personnel who try very hard in the face of such government intervention and coercion to act as an efficient means of spreading catastrophic risk.
In short, it is the abject absence of a free market in health insurance which has caused the high cost because it is the government and its interventions that prevent the free market to operate. Those issues could easily have been addressed with targeted legislation freeing up the market. Such would have been an intelligent, insightful, and foundationally coherent approach. Instead, you have voted to go 180 degrees, and 500 miles per hour, in the opposite direction.
Senator Bennet, I am deeply disappointed in you, disheartened, and, in fact, sickened by this initiation of tyranny over the lives of good, decent, hardworking Americans.
Note: Also see the text of the Nelson deal here..(pp 98)