Category Archives: Economics

Business, Economics, Philosophy, Political Commentary

The Legacy Of Bankruptcy

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…of “progressives.”

The Founders’ understanding of the origin of government, in turn, proceeds from a recognition of the difficulty many individuals have in honoring the obligations that flow from the equality principle. Government is formed, in other words, for the express purpose of better enforcing this duty among men, thereby better securing the freedom of all. “If men were angels,” as Madison famously wrote in Federalist 51, “no government would be necessary.” Precisely because men are not angels, because many are strongly inclined to violate the rights of others when it is in their interest to do so, individuals consent to enter into the social compact, and establish government on the understanding it will use its powers to restrain those domestically and internationally who would violate their freedom. In principle, then, the power of government is not absolute but is limited to whatever actions are necessary to secure the natural rights of its members.

By rejecting the existence of natural rights, accordingly, the Progressives consciously repealed this limit: “It is not admitted that there are no limits to the action of the state,” Merriam observed, “but on the other hand it is fully conceded that there are no ‘natural rights’ which bar the way. The question is now one of expediency rather than of principle. . . . Each specific question must be decided on its own merits, and each action of the state justified, if at all, by the relative advantages of the proposed line of conduct.” In devising the content of the law, legislators need not worry about respecting the individual’s natural right to rule himself, because “there are no ‘natural rights’ which bar the way.”

In principle, accordingly, all of the rights previously believed to inhere in the individual — e.g., the rights to life, to physical liberty, to decide whom to marry, to enjoy the fruits of his labor, to speak freely, etc. — were now subject to public disposal. Whether and to what extent government allows individuals to control any aspect of their personal concerns was now purely a matter of how it viewed the consequences of doing so. To illustrate just how far the Progressives were willing to take this, Merriam, in drawing the foreign-policy implications of this change, declared: “Barbaric races, if incapable, may be swept away; and such action ‘violates no rights of these populations which are not petty and trifling in comparison with its [the Teutonic race’s] transcendent right and duty to establish legal order everywhere.’” As Progressive economist and New Republic editor Walter Weyl summed up this shift in 1912, America was now “emphasizing the overlordship of the public over property and rights formerly held to be private.”

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Business, Economics, Media Criticism, Political Commentary

Now I’ll Have To Rethink My Position

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Are the elite starting to turn against Obama?

“If you’re asking if the United States is about to become a socialist state, I’d say it’s actually about to become a European state, with the expansiveness of the welfare system and the progressive tax system like what we’ve already experienced in Western Europe,” Harvard business and history professor Niall Ferguson declared during Monday’s kickoff session, offering a withering critique of Obama’s economic policies, which he claimed were encouraging laziness.

“The curse of longterm unemployment is that if you pay people to do nothing, they’ll find themselves doing nothing for very long periods of time,” Ferguson said. “Long-term unemployment is at an all-time high in the United States, and it is a direct consequence of a misconceived public policy.”

But…but…Nancy said that paying people unemployment was the fastest and best way to create jobs!

Ferguson was joined in his harsh attack by billionaire real estate mogul and New York Daily News owner Mort Zuckerman. Both lambasted Obama’s trillion-dollar deficit spending program—in the name of economic stimulus to cushion the impact of the 2008 financial meltdown—as fiscally ruinous, potentially turning America into a second-rate power.

“We are, without question, in a period of decline, particularly in the business world,” Zuckerman said. “The real problem we have…are some of the worst economic policies in place today that, in my judgment, go directly against the long-term interests of this country.”

Gee, Mort, I could have told you that two frickin’ years ago. Why did it take you so long to catch on that you were one of the rubes?

And I loved this:

Ferguson warned: “Do you want to be a kind of implicit part of the European Union? I’d advise you against it.”

This was greeted by hearty applause from a crowd that included Barbra Streisand and her husband James Brolin. “Depressing, but fantastic,” Streisand told me afterward, rendering her verdict on the session. “So exciting. Wonderful!”

Brolin’s assessment: “Mind-blowing.”

To be fair, though, I suspect that you could blow Brolin’s mind with a butterfly wing.

This can’t be good for his renomination prospects. The long knives will be out on November 3rd, I suspect.

Economics, Political Commentary

I’m With Them

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Most Americans don’t want to pay higher taxes to bail out public employees and entitlements:

The latest Rasmussen Reports national telephone survey of Adults shows that only 19% would be willing to pay higher taxes to avoid layoffs of state employees. Sixty-nine percent (69%) say they would not be willing to pay more in taxes for this reason. Another 11% are undecided.

Adults feel similarly when it comes to funding entitlement programs. Twenty-two percent (22%) would pay higher taxes to prevent cuts in entitlement programs for low-income Americans. Sixty-three percent (63%) say they would not pay more to keep these programs afloat. Another 15% are undecided.

Americans are slightly less opposed to paying higher taxes for education. Thirty-four percent (34%) say they are willing to pay higher taxes to provide funding for public education, but 54% say they are not. Another 12% aren’t sure.

Of course, it’s already too late, since a large part of Porkulus went to exactly this, and at some point, we’ll have to pay for it (not to mention the interest on it). What I find the most interesting about this poll is that (unlike most Rasmussen polls) it’s of adults. I wonder what likely voters think?

This will be a potent campaign issue (among many) against Democrats this fall.

Business, Economics, Political Commentary

The Argument Never Ends

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Keynes versus Hayek. Of course, it’s never an argument about how best to revive an economy — it’s an argument about how to either maximize government power, or to liberate the people from an overspending, overtaxing tyrant.

[Update a few minutes later]

Lynne Kiesling has more thoughts:

This theme of “economic control becomes political control” is crucial to making sense of the corporatist nature of political activity, and why regulation is so pernicious for individual well-being and liberty.

Hayek is, if not one of the first to make this connection, certainly the most prominent early proponent.

Business, Economics, Political Commentary

The Coming Depression

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A cheery interview with Vox Day:

The dirty little secret of politics is that most politicians are of barely above average intelligence and possess very narrow educations. They’re mostly people with IQs of around 120 and a law degree. So, they know literally nothing about economics and lack the capacity to see that what the experts are telling them doesn’t add up. Given those circumstances, it should come as no surprise that they so readily embrace the economic theory that tells them exactly what they want to hear. “Go, thou, and spend, and thus shalt the economy be saved. And lo, thou shalt be the savior of thy people!” That’s a lot more palatable than being told that the nation is in dire straits and their careers are in jeopardy due to the actions of their predecessors, and that there’s not much they can do about it. So, they listen to the self-interested parties and blindly go about making the situation worse.

I think that he overestimates the intelligence of the narrowly educated lawyer/politicians. Particularly the one in the White House.

Business, Economics, Political Commentary

An Oil-Spill To-Do List

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I’m sure that the president will get right on it, just as soon as he finishes his latest round of golf.

You know, I’ll bet that Bobby Jindal hasn’t hit the links once in the past couple months.

One of the most insane things is the EPA not allowing the ships to clean the water, because they only remove ninety-plus percent of the oil. This is bureaucracy run amok. The president could fix it with the stroke of a pen. I wonder why he doesn’t?