Wednesday, October 22, 2008

The Difference Between Political and Economic Freedom

The notion that economic freedom precedes political freedom is a popular myth amongst academic leftists. Perhaps you have heard "Well who cares about ideology when there is starvation" or the bearded close fisted revolutionary yell of "bread precedes liberty" Ironically ivory tower socialists claim philosophy or ideology "is a middle class term throw away" term without any practical implications because men’s needs are primarily economic and not political or said differently physical instead of intellectual. Declaring man’s needs as material and that the mind is of no importance is not original; it’s an essential tenet of Communism and is rehashed in many alternate forms by contemporary leftists. Believing man’s needs may not move beyond the material until his physical needs are met is naïve at best as it is easily seen to be evidentially false in both historical and logical contexts.


Historically the idea is radically false. Never in history has an increase in economic wealth existed prior to political freedom. Liberty preceded wealth in ancient Greece. Rule of law (rule of law awards liberty because it frees people from being ruled by the unpredictable arbitrary whims of a tyrant. Instead there is an open code of laws which all men, regardless of birth, must adhere to) lead to the prosperity in ancient Rome. Free trade—the Corn laws— led to the industrial revolution in Great Britain, The bill of Right led to America being the most prosperous county in the modern world and freedom preceded wealth in 20’th century South Korea, Hong Kong, And Japan. And in contrast evaluate the economic freedom produced in historically politically un-free countries—China, North Korea, Palestine, Cuba, Iran, Iraq, Sudan and East Germany. This is not a coincidence because individual freedom and limited government are absolutely necessary for obtaining man’s most basic needs and material wealth.


Logically the notion that man can be a slave ruled by force and still be economically prosperous—on any general level— is false and ultimately arbitrary because the assertion refuses to attach itself to any context. It fails to take into account how material wealth is created or how physical requirements are most efficiently met. To claim they both exist separately and independent from one and another is absurd. They are not corollaries but rather they are related causally. Man needs to be free for the very reason of meeting his most basic goals. A moral code that says man has no right to his own life, or to the rewards he produces is antithetical to in every way to economic freedom. To deny man freedom is to condemn him to death for the very reason that on a grand scale he will not be able to meet his physical needs.


Marxists claim that philosophy is a bourgeois pastime of no relevance to the real world yet this philosophical misunderstanding has lead to over 100 million deaths. "Philosophy" and "Freedom" are not unimportant middle class leisure words but rather they are some of the most important concepts man has ever created and without their understanding we doomed to endless misery, slavery, famine and warmongering

Tuesday, October 21, 2008

Greed

The other day I was bemoaning the point that Canadians are the second most taxed people in the world, second only to China. Second to China is only good if we are talking gold medals at the summer Olympics—in terms of taxation it is brutal. I was ranting about 30% of my paycheck, 5% on everything I purchase (recently $25,000 on a house), property taxes on that same house I already own, GST on gasoline taxes….etc. Anyway a co-worker overheard me and quipped triumphantly “Oh I guess I’m not as greedy.”
“What do you mean?”
“Oh well I ma not as concerned about money. I don’t mind doing my fare share.” She smiled. I scowled.

My willingness or unwillingness to pay exuberant taxes is not an issue of greed rather it is an issue of passivity. I have no qualm with someone donating their earned wealth to whatever cause or causes them deem necessary. I support freedom of choice. Philanthropy is a choice and a highly dignified one at that. I support certain charitable activities, and I suppose that that is the norm rather than the exception. People that succeed are usually only more than happy to give back to the country and community that helped give them that chance.

My hatred of over taxation is an issue of liberty and freedom. I don’t believe in a large interventionist government redistributing my wealth for causes that it deems necessary. I can make my own choices on whether I want to support PETA, the Heart and Stroke foundation, the arts, or political think tanks... My issue with over taxation has nothing to do with greed and everything to do with liberty. A free man does not work the first six months of every year to support his feudal bureaucratic masters. A free man is not passive about his freedom. It is his highest value. I am a free man

Thursday, October 16, 2008

Don't Blame Capitalism

Don't Blame Capitalism

This article was written by Peter Schiff
Here is a breakdown of the financial crisis that deals with the real perpetrators

Amid the chaos of recent days, as the federal government has taken gargantuan steps to stabilize the financial markets, realigning the U.S. economic system in the process, comes a nearly universal consensus: This crisis resulted from government reluctance to regulate the unbridled greed of Wall Street. Many economists and market participants who were formerly averse to government interference agree that a more robust regulatory framework must be constructed to cage the destructive forces of capitalism.


Absent from such conclusions is the central role the government played in creating the crisis. Yes, many Wall Street leaders were irresponsible, and they should pay. But they were playing the distorted hand dealt them by government policies. Our leaders irrationally promoted home-buying, discouraged savings, and recklessly encouraged borrowing and lending, which together undermined our markets.


Just as prices in a free market are set by supply and demand, financial and real estate markets are governed by the opposing tension between greed and fear. Everyone wants to make money, but everyone is also afraid of losing what he has. Although few would ascribe their desire for prosperity to greed, it is simply a rose by another name. Greed is the elemental motivation for the economic risk-taking and hard work that are essential to a vibrant economy.

But over the past generation, government has removed the necessary counterbalance of fear from the equation. Policies enacted by the Federal Reserve, the Federal Housing Administration, Fannie Mae and Freddie Mac (which were always government entities in disguise), and others created advantages for home-buying and selling and removed disincentives for lending and borrowing. The result was a credit and real estate bubble that could only grow -- until it could grow no more.

Prominent among these wrongheaded advantages are the mortgage interest tax deduction and the exemption of real estate capital gains from taxable income. These policies create unnatural demand for home purchases and a (tax-free) incentive to speculate in real estate.

Similarly, the FHA, Fannie and Freddie were created to encourage lending by allowing primary lenders to turn their long-term risk over to the government. Absent this implicit guarantee, lenders would probably have been much more conservative in approving borrowers and setting interest terms, and in requiring documentation of incomes and higher down payments. Market forces would have kept out unqualified buyers and prevented home-price appreciation from exceeding the growth in household income.

Interest rates contributed the most to creating the housing boom. After the dot-com crash and the slowdown following the attacks of Sept. 11, 2001, the Federal Reserve took extraordinary steps to prevent a shallow recession from deepening. By slashing interest rates to 1 percent and holding them below the rate of inflation for years, the government discouraged savings and practically distributed free money.

Artificially low interest rates invigorated the market for adjustable-rate mortgages and gave birth to the teaser rate, which made overpriced homes appear affordable. Alan Greenspan himself actively encouraged home buyers to avail themselves of these seeming benefits. As monetary policy caused houses to become more expensive, it also temporarily provided buyers with the means to overpay. Cheap money gave rise to subprime mortgages and the resulting securitization wave that made these loans appear safe for investors.

And even today, as market forces deflate the credit bubble, the government is stepping in to re-inflate it. First came the Treasury's $700 billion plan to purchase mortgage assets that no one in the private sector would buy. Now it has recapitalized banks to the tune of $250 billion, guaranteeing loans between banks and fully insuring non-interest-bearing accounts. Policymakers say that absent these steps, banks would not be able to extend loans. But given our already staggering debt burden, perhaps more loans are not the answer. That's what the free market is telling us. But the government cannot abide solutions that ask for consumer sacrifice.

Real credit can be supplied only by savings, so artificial steps to stimulate lending will only produce inflation. By refusing to allow market forces to rein in excess spending, liquidate bad investments, replenish depleted savings, fund capital investment and help workers transition from the service sector to the manufacturing sector, government is resisting the cure while exacerbating the disease.

The United States reached its economic preeminence on the strength of its free markets. So far, the economic disaster exacerbated by government policies is creating opportunities for further government interference, which will lead to bigger catastrophes. Binding the country to a tangle of socialist ideals will seal our fate as a second-rate economic power.

The writer, who was economic adviser for Ron Paul's 2008 presidential campaign, is president of Euro Pacific Capital. He is the author of "The Little Book of Bull Moves in Bear Markets."

Finally somebody telling the truth

Thursday, October 09, 2008

Popular Leftwing Misconceptions about the Right

After my last post, four Masters Students from Ontario have invited me to critically assess some of their articles they have published on their new blog. They are interested in a counter view point. I can respect that. As Hegel proclaimed higher ideas are born out of the thesis— antithesis=synthesis dialectic. So let’s give it a shot a roughneck against university academics.

The article historically traces ideology in Canada (from Keynes to Neo-conservatism) and offers us the chance to begin to make some conclusions about the consequences of those changes— albeit through a socialist filter. The conclusions are too broad to argue in 500 words, so let’s start with some of the premises. The article is predicated on popular leftwing misconceptions about the movement toward liberal markets and greater freedoms.

“to maximum state involvement of the Keynesian policies and recently back towards a minimalist neo-conservative view.”

Keynsian economics is a monetary policy not a political one. Keynsian monetary policy dictates that the government should inflate the money supply to match the demands of production. In that sense Keynsian economics is still the order of the day. The Austrian economists would never have advised a 700 billion dollar bailout. In fact Austrian economics predicted the financial collapse which we are now witnessing.

Also neo-conservatism is hardly the Stephen Harper Conservative model. Neo-conservatism believes in world building, big military and are hardly opposed to deficit spending—see George Bush.

“and more specifically Ontario, the reigning political ideology favours minimal state involvement in economic life.”

I don’t consider the Canadian government to be anything near “minimalist intervention”. Powerful unions, crown corporations, wealth transfer payments, some of the highest tax rates in the world… the list could go on, but the point being that any interpretations that are to be made about the Canadian standard of living/economy should be made with the understanding that Canada is closer to socialism than it is to truly capitalist world.

This ideology (free market) rests on the theory that everyone will benefit from free market societies as wealth tends to have a trickle down effect.

Not exactly, the higher premise is that a free individual living in a free world will be better suited to produce wealth without the interfering of a distant bureaucrat. People are better left to making their own decisions than being led about by a powerful government. See the difference between Russia and North America.

"The social spending that is under greatest attack in Ontario is income maintenance programs….This program subsequently works to maintain inequalities, not lessen them."

All socialist schemes entrench class rigidity. Since the Paris Union man has been limited in the wealth he can produce he has none to pass onto his children, instead he passes on his title (job status), and his rent controlled apartment. This is all well and good, but what about the immigrants, the youngster with no nepotistic connections? Government control and high taxes have limited the private sphere and the public sphere/ and unions are being blocked by the third and fourth generation workers so what are the options for outsiders?

Wednesday, October 08, 2008

Circular Reasoning

At last week’s debate Jack Layton and Elizabeth May were clamouring for a “buy Canadian” policy. Jack said something to the effect that we shouldn’t be cutting down our pine trees and letting someone else build the tables. We should be building the tables too! Forget about the sound economic principle of Comparative Advantage and lets dig a little deeper into the rhetoric.

A few minutes later good ol’Liza remarked that Canada needs to do its part to help the developing world and pledged her support of 0.7 of Canada’s GDP on a yearly basis for this pet project of hers. Never mind the how. And then before the how could be asked Jack nodded in affirmation.

Let me get this straight Jack and Liza don’t want to let countries like Mexico and the Dominican Republic buy our lumber so they can develop their own secondary manufacturing industries, but at the same time supports a plan to extort Canadian money to hand over in the form of massive welfare packages to the very same people. Brilliant? Does anyone else have trouble with this type of circular reasoning?

The real difference lies in the results. Where international welfare encourages idleness, corruption (the emphasis shifts from productivity to creating a perception of neediness), and subordination (most aid money ends up in the hands of tyrants who use it to support their own agendas), while trade on the other hand, encourages technological advance, cooperation, independence, responsibility, and dignity and equality between countries.

Leftism has never been about goodwill, instead it is about power. Sure you may claim that we can all break close to even on wealth redistribution schemes but the point is that the government is now picking who wins and who loses, and it also gives them the ability to reward their friends and punish their enemies, in other words maintain control over their populations—by destroying the independence of the people over which they govern.

The new Amero currency

Let't take a look at some quotes about the banking system

"Let me issue and control a nation's money and I care not who writes the laws."--Mayer Amschel Bauer Rothschild (1744-1812), founder of the private International Banking House of Rothschild.

"The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in inequity and born in sin. Bankers own the Earth. Take it away from them but leave them the power to create money, and with a flick of a pen, they will create enough money to buy it back again. Take this great power away from them and all great fortunes like mine will disappear, for then this would be a better and happier world to live in. But if you want to continue to be the slaves of bankers and pay the cost of your own slavery, then let bankers continue to create money and control credit."--Sir Josiah Stamp, president of the Rothschild Bank of England and the second richest man in Britain in the 1920s, speaking at the University of Texas in 1927.

"If the American people ever allow private banks to control issue of their currency, first by inflation, then by deflation, the banks and the corporations that will grow up around them, will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."--Thomas Jefferson in the debate over his opposition to the Re-charter of the Private Bank Bill (1809).

"I sincerely believe that banking establishments are more dangerous than standing armies..."--Thomas Jefferson to John Taylor, 1816.

"The Federal Reserve banks are one of the most corrupt institutions the world has ever seen. There is not a man within the sound of my voice who does not know that this nation is run by the International Bankers.--Congressman Louis T. McFadden (Rep. Pa)

"The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests."--The Rothschild brothers of London writing to associates in New York, 1863, laying the groundwork for the eventual passage of their catastrophic Federal Reserve Act on December 23, 1913

"... You are a den of vipers and thieves. I intend to rout you out, and by the grace of the Eternal God, I will rout you out."--President Andrew Jackson, upon evicting a delegation of International Bankers from the Oval Office

"The real truth of the matter is, and you and I know, that a financial element in the large centers has owned the government of the U.S. since the days of Andrew Jackson. History depicts Andrew Jackson as the last truly honorable and incorruptible American president."--President Franklin Delano Roosevelt, November 23, 1933 in a letter to Colonel Edward Mandell House

"We have, in this country, one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This evil institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the moneyed vultures who control it."--Congressman Louis T. McFadden in 1932

"It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."--Henry Ford inventor and founder of the Ford Motor Company.

"Some [most] people think the Federal Reserve Banks are U.S. government institutions. They are not ... they are private credit monopolies which prey upon the people of the U.S. for the benefit of themselves and their foreign and domestic swindlers, and rich and predatory money lenders. The sack of the United States by the Fed is the greatest crime in history. Every effort has been made by the Fed to conceal its powers, but the truth is the Fed has usurped the government. It controls everything here and it controls all our foreign relations. It makes and breaks governments at will."--Congressional Record 12595-12603 -- Louis T. McFadden, Chairman of the Committee on Banking and Currency (12 years) June 10, 1932

"History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance."--President James Madison

"... we conclude that the [Federal] Reserve Banks are not federal ... but are independent, privately owned and locally controlled corporations ... without day-to-day direction from the federal government.."--9th Circuit Court in Lewis vs. United States, 680 F. 2d 1239 June 24, 1982

"People [private Federal Reserve Corporation stockholders] who will not turn a shovel full of dirt on the project (Muscle Shoals Dam) nor contribute a pound of material, will collect more money [usury] from the United States than will the People who supply all the material and do all the work. This is the terrible thing about interest ...But here is the point: If the Nation can issue a dollar bond, it can issue a dollar bill [U.S. Note]. The element that makes the bond good makes the bill good also. The difference between the bond and the bill is that the bond lets the money broker collect twice the amount of the bond and an additional 20%. Whereas the currency, the honest sort provided by the Constitution pays nobody but those who contribute in some useful way. It is absurd to say our Country can issue bonds and cannot issue currency. Both are promises to pay, but one [Federal Reserve Notes] fattens the usurer and the other [U.S. Notes] helps the People. If the currency issued by the People were no good, then the bonds would be no good, either. It is a terrible situation when the Government, to insure the National Wealth, must go in debt and submit to ruinous interest charges at the hands of men [International Bankers] who control the fictitious value of gold. Interest is the invention of Satan".--Thomas A. Edison

Still not convinced check out this clip

http://www.youtube.com/watch?v=ge2J2lNusJs

Saturday, October 04, 2008

The Debate and Proportional Representation

The debate was pretty typical. The minority parties claiming Harper is a wannabe Bush and Harper trying to convince them that he is also in favor of government intervention and wealth redistrobution so they have nothing too worry about. Some things never change. Seriously, Harper wants to shower us with small five and dime tax cuts that amount to squat. You want to help a family stay independent of the proverbial teat then Why not income splitting? Reduce the overspending so we can have some meaningful tax reform. Then there is Layton who, as usual wants to completely regulate the economy-- buy Canadian (see principle of Comparative Advantage). Dion was Dion-- the Liberals only agenda is power, hence fearmongering and an all over the map plan for the country. These guys hate intellectual consistency. And Elizabeth May was a shrill harping thing, not really concerned with things green, but instead political funding. Once again a minority party clamouring for political funding-- proportional representation. I am staunchly against proportional representation.

Here are the top 8 reasons Canada should never have Proportional representation.


1)Minority party votes are constantly sold for funding towards whatever special interest the selling party represents.

2)The proportional representation methodology increases voter apathy as it quickly becomes a system where votes must be bought in order to form a coalition government which has consequences.

3)It validates the public’s sense of government corruption as it’s an electoral system that favors and demands political deals.

4)The ridiculous amount of compromise eradicates ideology and makes long term vision impossible

5)Essentially you move from an electoral system where the majority party determines policy into one in which the party with the fewest votes does.

6)The proportional system is in fact less proportional as it has the uncanny ability to lock old political hacks into their position.
When a party receives 10 percent of the vote they allowed to choose which members of their party will represent their party in legislature, which is good for longtime serving senior party faithful, but is counterproductive to getting new blood and ideas into government.

7)Proportional representation is inherently against principles making it range of the moment pragmatic whim worship. Long range vision requires principle

8)Once Proportional Representation has been legislated further electoral form becomes next to impossible. Picture Canada’s attempt at negotiating a charter between three regionalized interests, and the endless amounts of stalling, compromise and redundancy, and ultimately futility involved that process. Imagine trying to agree on similar monumental reform with over 100 special interest groups being represented. Change would only happen through revolution. Reason would be invalidated as a political tool and thus parties world switch to force when trying to mandate change.