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Sunday, December 11, 2011

Stop Trying to Create Jobs!

I know this heading sounds crazy. After all, everyone wants more jobs. All of the presidential hopefuls have their own jobs plan, and President Obama even created a new “Jobs Czar” position in his cabinet and appointed General Electric's CEO, Jeffrey Immelt, to the post.

But is job creation really a proper government policy goal? To answer this question, we need to ask what we want the economy to do for us. How about this: The economy should create as much wealth as possible with as little human effort as necessary.

Really, isn’t this just good common sense? Why would you want to expend any more human effort than necessary to create the products and services that people want and need? Obviously, labor-saving devices and increased worker productivity are good things, yet you might think they are bad things if you are too focused on jobs.

Too bad so many people in government make exactly that mistake. They are so motivated to protect existing jobs that they do so at the expense of job creation and wealth creation. It causes them to pursue such wrong-headed policies as import barriers, export subsidies, government make-work projects, a large standing army, a complex tax code, and burdensome regulations that divert valuable resources.

This is not to say that government is helpless to cure unemployment. It can do so by ending government policies which make it less profitable to hire workers; policies like minimum wage laws, the payroll tax, and laws making it difficult to dismiss workers or easy to be sued by workers. Also, a lower corporate tax rate would help.

Lately we have had some severe job-killing new policies, specifically, the threat of Obama-Care, restrictions on domestic energy production, impending EPA greenhouse gas regulations, the re-regulation of business accounting guidelines (Sarbanes-Oxley), and the reform of financial practices (Dodd-Frank). Maybe that’s why companies have become reluctant to hire (well duh).

According to the insight of von Mises, a free economy naturally produces low unemployment because human capital is the scarcest of all resources. That’s why excessive unemployment is always a government failure, never a market failure. Remember that next time someone complains that the economy isn’t producing enough jobs.

Wednesday, April 13, 2011


Murray Rothbard's CONSPIRACY THEORY OF HISTORY – by Dan Fernandes

(From a talk by Alan Pyeatt at the Libertarian Party of East San Gabriel Valley Dinner Club in February of 2011)

How do you react when someone tells you that an event in history was the result of a conspiracy? Do you lean toward immediate doubt, thinking conspiracies are rare and unlikely? That reaction may be common, but according to Murray Rothbard (1926-1995), it is not justified. In Rothbard's view of history, a conspiracy by the parasitical ruling class perpetually exists to maintain and extend power over the majority productive class.

The conspiratorial ruling class inside government receives help from many co-conspirators outside government, people Rothbard refers to as “Court Intellectuals”. In the past, it was the clergy who filled this role. In modern times, people like college professors, media commentators, and business leaders are the co-conspirators.
A perpetual conspiracy by these advocates of big government is absolutely necessary because the people must be persuaded, against their own best interests, to donate wealth, and to eschew liberty, in order to support an intrusive, burdensome, and ever-expanding government. The conspirators do this by continuously conjuring up new “threats” to society, both real and imagined, that only the government can theoretically resolve. These perceived threats include foreign enemies, market failures, cultural failings, and most recently, environmental concerns. The conspirators also must conspire to cover up government failures, so that the people do not lose faith in their big government.

It is important to point out that a conspiratorial view of history provided much of the impetus for the natural rights theory found in the Cato Letters, which sparked the American Revolution. So it is likely that our country's founders would have agreed with Murray Rothbard's conspiratorial views. By conspiracy, we don't mean that a large number of people necessarily get together in the same room and agree to conspire. Rather, we mean all conspirators are aware that they themselves are falsifying or suppressing information and that many other like-minded people are doing the same, for some common purpose which would be considered evil by the people being deceived.

How can you tell if any specific conspiracy theory is true? Rothbard suggests that you strongly consider motives. That includes the power motives of the ruling class and their advisors, the power and economic motives of people such as bureaucrats and business leaders, and the ideological motives of people such as academic intellectuals and the news media. When motives to conspire are strong, a conspiracy is the most likely explanation of human action.

The proof of any theory is in how well it explains the real world. According to Rothbard, his conspiracy theory of history explains many historic events. For example, it explains how participants were drawn into World Wars I and II, and how U.S. foreign policy during that period was transformed from one of benign neutrality to one of becoming world policeman. I would add that it certainly explains climate change alarmism.

How can we best defend ourselves from conspiracies to expand government power? According to Rothbard, our best defense is the ideological ammunition supplied by people he calls radicals, or opposition intellectuals. And one of their best tools is to expose government conspiracies, not only in the present, but also through revisionist accounts of history. Rothbard himself was one such radical. Of course, an important element of pro-government propaganda is to discredit conspiracy theories, and to marginalize people who espouse them.

So the next time someone offers you a conspiracy theory, keep an open mind. Certainly, there are some unlikely conspiracy theories, but then again, many conspiracies have actually occurred. Truth is not so easy to determine, and there is no substitute for good judgment.

Wednesday, February 16, 2011

It’s Illegal Not to Do That

With the recent passage into law of the National Healthcare Reform Act contemptuously referred to as ObamaCare, people have been expressing their outrage over one particularly offensive feature know as mandatory insurance. This would make it punishable by fine for individuals not having employer-provided coverage to not buy health insurance. A dozen state legislatures have even passed resolutions attempting to nullify this law in their state, claiming it is unconstitutional and unprecedented. But is it really, or are there other existing crimes of inaction (other than the payment of taxes) which could serve as precedents for the ObamaCare individual mandate?

When considering possible crimes of inaction, here are some that come to mind: compulsory school attendance for children; the requirement to serve in the military when the draft is activated; the requirement to report child abuse when observed; the requirement to verify employee legal status when hiring a worker; firearm registration; the requirement to serve on a jury when called; the requirement to purchase automobile liability insurance and to wear a seat belt or a helmet; food nutritional labeling; and coming to your city soon – mandatory recycling! I suspect we could come up with thousands of other examples if we pored through all the federal regulations.

I must regrettably conclude that crimes of inaction have long been with us, although there are no such laws that I would support. Our government apparently has the power to tell us what to do as well as what not to do. To my way of thinking, the power to command behavior is the power to enslave. Maybe we need a constitutional amendment that says something like this: Congress shall make no law mandating any action other than the payment of taxes. What a huge roll-back of the regulatory state, and a tremendous defense for our liberties, that would be! But first, please ask yourself - which of your favorite laws would be nullified, and could you live without them?

As for the constitutionality of ObamaCare, don’t be silly. Where is it stated in the constitution that the federal government shall regulate health care? (Answer: no place.) Lack of constitutionality hasn’t stopped our federal government for decades now, and in spite of recent lower court rulings, I expect that at least five Supreme Court justices will find some lame excuse to justify ObamaCare.