Friday, February 27, 2015

Watch out, there are more music thieves about

Conventional wisdom says that as you make online music easier to buy rather than steal1, then buy-rather-than-steal becomes more preferred.

Turns out this is bullshit.  As the number of legal downloading, streaming and listening opportunities continues to expand, the number of US uni students (the stealingest bunch there is) who steal rather than buy is increasing, not decreasing.

image

Increasing a lot:

The percentage of college students in our survey that DO NOT buy digital music has risen from 26.5%  in 2014 to 36.7% in 2015.  This corresponds to reports of drops in sales of digital music elsewhere.

So that’s (let me just calculate here, hold on…) a whole shitload more musicians this year not getting paid for their work than last year.

Nice.

What was the last piece of music you bought legally?


1. Yes, I know there are arguments that downloading someone else’s music without paying for it and without their permission not to pay for it is not stealing. It’s just that those arguments are ludicrously self-serving, and wrong.

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Getting people out of the shit

Welfare dependence in New Zealand is intergenerational.  There’s around a million or more New Zealanders who depend on welfare for their weekly wedge. And, as Lindsay Mitchell reports, new research shows conclusively that, and I quote, “three quarters of the forward cost of welfare rests with those who go on welfare under twenty.”

Got that? Three quarters of the forward cost of welfare rests with those who go on welfare under twenty.

And of that number under twenty,

(9 in 10) were from beneficiary families, the majority of whom received a main benefit for most of their teen years.

And

51% were in beneficiary families for 80% or more of their teen years.

So it surely looks as though entitle-itis is born, not made.

As Lindsay says, “this gets to the crux of welfare dependence. For the most past, welfare is not helping helping folk get out of a bad situation. Instead, it is encouraging bad situations to remain, and to become intergenerational. 

It is not helping people out of the shit. It is creating generation after generation of folk who see shit as their permanent station in life – as suckers on the state tit for life.

Call it the soft bigotry of low expectations.

Only the people who created this system could be happy.

It’s not just unaffordable – government debt increasing every year to pay for it. It’s not just unsustainable – the experiment is only decades long, and already beyond the means of most countries to sustain it. It’s destructive all round, for no real fruit.

So how do we get welfare out of the shit?

How about start by removing welfare at the margins.

What are the margins?

Well, there’s a list you can make, from most- to least-deserving of your coin:

  1. Individuals and families who are in the shit
  2. Businesses and sports teams who are in the shit
  3. Businesses and sports teams who want a favour

Then, use  the Old-White-Haired Mother test created by PJ O’Rourke: recognise that all welfare is paid for out of somebody else’s pocket, extracted at the barrel of a gun. So ask yourself, does this particular measure justify putting a gun to the head of my kindly white-haired old mother.

Unless you’re a Sky City director you’d have to agree at getting rid of #3. And unless you’re a beneficiary of South Canterbury Finance, or Grant Dalton, you’d surely agree there’s little justification for #2.

See how easy it is? Already we’ve slashed away some big margins.

How about the people in item 1: individuals and families who are in the shit. What do we do about them.

Here’s another kind of list that cuts through the fog:

  1. People who through no choice of their own are in the shit; and
  2. People who’ve made choices that turned into shit; and finally
  3. People who’ve chosen to stay in the shit.

It’s fairly clear that in any kind of quest for coin, it’s not number 3 who are the most deserving of your white-haired old mother’s mugging.

And those  #2 folk can, at best, only justify mugging her temporarily, by making their stay on the state tit temporary.

So #1 folk are the only ones with any kind of moral claim on my mother’s mugging – people who through no choice of their own, and through either disability, illness or severe quadriplegia are in the shit for life, with no parole.

And, well, really, there’s hardly a million in that boat, is there. Let’s be fair, hardly even 10,000.

Not so many, in fact, that they couldn’t all be helped out by voluntary charity…

Think about it.

Intergenerational state welfare has delivered unsustainable debt and an all-but permanent underclass.

If you can save those permanently enmired and your white-haired old mother at the same time, why wouldn’t you?

If we’re going to help – you know, like actually help, with actual positive outcomes and all that -- then let’s help people out of the shit they’re in, not lock them (and us) in there permanently.

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‘Audit the Fed’ gains ground as the left (re) discovers its inner Love of central banking

Guest post by Nick Sorrentino

Eccles building cc

The American Federal Reserve, as we have noted before, is the world’s Prime Mover of crony capitalism. It is a politburo. It is a central planning committee. It is a tool by which the big banks are backstopped with the wealth of the American people. It should be audited. It should be opened.

This is what the U.S. dollar has done under the Fed:

dollar graph  c                          c

In fairness it’s not JUST the Fed. Other central banks1, like NZ’s Reserve Bank, have done their part for other currencies as well.

Fed advocates like Paul Krugman (featured in the attached article, below) fear fundamentally that the citizenry will one day lose confidence in a dollar which is conjured out of nothing. So long as the major media, the big banks, Keynesian economists like himself, and the politicians are all singing from the same song sheet then the game can continue. If however someone was to really get through to the American people, and was to effectively highlight the insanity of the Fed system, well then all bets are off for the crony capitalists. Krugman would have to spend the rest of his life cuddling his cat in disgrace. Which would be just fine.

The anti-audit-the-Fed stuff we’ve seen in recent weeks is coming because the Federal Reserve is scared. All the flak being shot isn’t because the Fed’s friends are actually afraid that an audit would somehow throw the economy off the rails. No, they are afraid of an audit because they’ve bought completely into a dishonest fiat money system and they are afraid that they will have to stand naked before history. That’s what they fear.

Audit the Fed and then end it. Make ‘em stand naked.

(From Forbes)

An empirical review published in 2011 by the Bank of England — not exactly a “fever swamp” — of the performance of the fiduciary currency standard relative to the performance of the Bretton Woods gold-exchange standard and the classical gold standard, found, as then summarized by Forbes.com contributor Charles Kadlec:

  • Economic growth is a full percentage point slower, with an average annual increase in real per-capita GDP of only 1.8%

  • World inflation of 4.8% a year is 1.5 percentage point higher;

  • Downturns for the median countries have more than tripled to 13% of the total period;

  • The number of banking crises per year has soared to 2.6 per year, compared to only one every ten years under Bretton Woods;

  • The number of currency crises has increased to 3.7 per year from 1.7 per year;

  • Current account deficits have nearly tripled to 2.2% of world GDP from only 0.8% of GDP under Bretton Woods.

Click here for the article.

1. Other central banks, like the Bank of England, for example,

From 1989 to now CPI has averaged just 2.8 per cent per year.
   
But the amount of money circulating in the UK has been ‘inflated’ at an average annual rate of 11.5 per cent over the same period.
   
In 1971 there was £31bn in circulation. Now there is just under £2,100bn (that’s £2.1 trillion). That is a 67-fold inflation (see, I’m using the word correctly and suddenly it makes sense) of the supply of money.
   
There are very few families, however, that are 67-times richer. I know mine isn’t.
   
That’s largely because wages have not kept up with the 67-fold increase in money supply. They’ve gone from about £2,000 in 1971 to around £25,000 today. So many families now find themselves having to work longer hours, with both spouses in the workplace, taking on larger debts and having fewer children just to maintain an ordinary middle class lifestyle. Their children face unprecedented levels of debt and, in many parts of the country, will never be able to buy a house.


This post originally appeared at Against Crony Capitalism

Thursday, February 26, 2015

Mercy to the guilty is injustice to Jeremy Frew

“Pity for the guilty is treason to the innocent.”
- Ayn Rand

“’Mercy’ means an unearned forgiveness.”
- Leonard Peikoff

So a dickhead who helped kill someone apparently appears on a TV show, and the producers don’t even bother to give the audience the full context of the crime for which he was jailed – a "rampage of violence" said the judge who convicted him; a “commotion” says the YV show -- nor warn the parents of the young man he killed that a thug who helped kill their son will soon be singing on their TV screen.

But it’s all okay, says the producer, because the thug has “paid his debt to society”  and everyone should move on.

Bullshit.

You see, this is just one more problem with having so many victimless crimes: when so many crimes are victimless, it’s so easy to forget that real crimes do have real victims. Your “debt,” as a criminal, is not to a collective; it is to those people whom you’ve harmed – those very real victims of your actions.

And dead victims can’t move on.

Mercy to the guilty is an injustice to the innocent. The producers of X Factor have committed an enduring injustice to Jeremy Frew and his family.

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A “target”?

It’s said that taking part in the war against IS barbarians will make New Zealanders a “target.”

Because, supposedly, people are only a “target” for Islamic barbarians if the barbarians are attacked by the people’s governments.

Really?

Then why was a Japanese journalist executed by Islamic State thugs, when Japanese armies hadn’t left their shores since 1945?

Why is Islamic State calling for their followers to launch attacks against famously neutral Switzerland?

Why were New Zealanders in Bali a target for Jemaah Islamiyah fully a year before New Zealanders joined the war in Iraq?

Why were Australians, a year before that same war?

Not to mention several thousand entirely innocent bus and train riders in London and Madrid and office workers in New York.

You can keep asking questions like that, but the truth is non-Islamic countries and non-aggressive non-Islamic folk are not targets because they’re going to war with Islamists. Because they’re not.  And because the truth is much, much simpler, which is this: Islamists are going to war with us because we are non-Islamist.

That’s it. That’s it right there.

Because that’s the real message of their “religion of peace” – a message evident from the history of Islam, from its birth to its Barbary Coast bandits and right up to its modern-day barbarians --  that “peace” in their eyes is only possible after all who don’t follow their prophet are subdued.

Understand that, and you’ll understand you’re already a target anyway.

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Quote of the morning: It’s easier for demagogues

"It is often sadly remarked that the bad economists present their errors to the public better than the good economists present their truths. It is often complained that demagogues can be more plausible in putting forward economic nonsense from the platform than the honest men who try to show what is wrong with it. But the basic reason for this ought not to be mysterious. The reason is that the demagogues and bad economists are presenting half-truths. They are speaking only of the immediate effect of a proposed policy or its effect upon a single group. As far as they go they may often be right. In these cases the answer consists in showing that the proposed policy would also have longer and less desirable effects, or that it could benefit one group only at the expense of all other groups." -- Henry Hazlitt in Economics in One Lesson

[Hat tip Lawrence Reed]

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It’s nice to be the gatekeeper.

“…there's no place for pure capitalism, unregulated capitalism,” says the CEO of Goldman Sachs. “We have a regulated system."

It’s certainly true there’s no place for unregulated capitalism at the entity often called Government Sachs. Not when the regulators, and the government, are in your back pocket -- and you’re the gatekeeper for their sluice.

[Hat tip Drew Taggart,

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Wednesday, February 25, 2015

“Turning to social liberalism, the issue I would suggest ACT focuses on is voluntary euthanasia.”

David Farrar was asked to talk to last weekend’s ACT conference on how ACT might gain more voters to increase their representation in parliament and decrease their reliance on the Epsom electorate?

Mark Hubbard will be pleased…

…I think a clear message of opposition to most forms of corporate welfare has potential appeal to not just economic liberals on the right, but also to many on the left. It would make it hard for the left to paint ACT as the party of big business, if they are signing up to your campaigns against corporate welfare.

Turning to social liberalism, the issue I would suggest ACT focuses on is [voluntary] euthanasia. Is anything a more fundamental human right than being able to choose between quantity of life and quality of life?
    This is not some abstract issue. Sadly for many families, they have been through the horrors of a loved one who was unable to make an informed choice to reduce their suffering.  I actually used to be against euthanasia until I listened to the speech Rodney Hide made in 2003 about the death of Martin Hames. It reduced me to tears and made me realise how harmful the current law can be, and converted me to favouring a law change.
    It is an issue that is both very real to many, but also very popular. The last public poll on this issue saw 61% in favour of terminally ill people being able to choose when to end their lives and only 18% opposed. A 3:1 ratio in favour is about as good as it gets.
    Labour has banned their MPs from advancing this issue, because it may distract them from their core mission of getting more people to join a union. National MPs are discouraged from doing bills on conscience issues. In fact I think National discourages their MPs from doing any bills that haven’t been written by Chris Finlayson for them. The highlight was the West Coast MP’s bill on reforming the law of habeas corpus.
    NZ First are generally against euthanasia, except for immigrants. The Greens are admirably supportive, but the suspicion is they see it as a way to reduce carbon emissions. 
    More seriously there is an opportunity for ACT here to lead on this issue, and connect to New Zealanders on an issue that resonates, as well as clearly position themselves as the only party not wanting the state to interfere in decisions that belong to individuals.

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Quote of the afternoon: Menger on economic progress

“The quantities of consumption goods at human disposal are limited only by the
extent of human knowledge of the causal connections between things, and by the
extent of human control over these things. Increasing understanding of the causal connections between things and human welfare, and increasing control of the less proximate conditions responsible for human welfare, have led mankind, therefore,
from a state of barbarism and the deepest misery to its present stage of civilisation
and well-being, and have changed vast regions inhabited by a few miserable,
excessively poor, men into densely populated civilised countries. Nothing is more
certain than that the degree of economic progress of mankind will still, in future
epochs, be commensurate with the degree of progress of human knowledge.”

- Carl Menger, founder of Austrian economics, from 
his Principles of Economics (1870)

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“The Earth Is Not a God: The false theology of radical environmentalists”

Some quotes from a superb review of Alex Epstein’s book The Moral Case for Fossil Fuels:

Epstein makes a compelling “big picture” case that the interaction of technology and fossil fuels provides everything we take for granted today. He also reminds us of earlier hysterical predictions of doom concerning fossil-fuel use. In the late 1960s and early 1970s, environmentalists such as Paul Ehrlich predicted mass starvation by the year 2000 because “world food production could not keep up with the galloping growth of population.” Flat wrong: the world’s population doubled, and the average person today is far better fed than when the starvation apocalypse was announced. That’s because the other apocalypse proclaimed back then—the depletion of oil and natural gas by 1992 and 1993, respectively—also proved wrong. Since 1980, worldwide usage of fossil fuels increased massively, yet both oil and natural gas supplies have more than doubled, and we have enough coal to last 3,000 years.
    Epstein explains what the environmental doomsayers could not or would not see: first, that “fossil fuel energy is the fuel of food”; and second, that the human mind is as powerful as [Benjamin] Franklin and [Francis] Bacon said it was.

Why do hysterical warnings about sustainability and depletion persist despite the failure of the crackpot 1960s and 1970s predictions? Because the non-impact standard—conceiving of the environment as a loving but finite God—sees the environment as having a limited “carrying capacity” of gifts, such as arable land, water, and crucial minerals, in addition to fossil fuels. The more people on the planet, the closer we are to maxing out that carrying capacity, the thinking goes. … This notion of a finite carrying capacity discounts the powerful role of human ingenuity in finding natural resources. …
    Epstein argues brilliantly that the carrying-capacity superstition amounts to a “backward understanding of resources.” The fact is that nature by itself gives us very few directly supplied energy resources: most resources “are not taken from nature, but created from nature,” he maintains. Every raw material in nature is but a “potential resource, with unlimited potential to be to be rendered valuable by the human mind.” Right now we have enough fossil fuels and nuclear power to last us thousands of years. “The amount of raw matter and energy on this planet,” Epstein writes, “is so incomprehensibly vast that it is nonsensical to speculate about running out of it. Telling us that there is only so much matter and energy to create resources from is like telling us that there is only so much galaxy to visit for the first time. True, but irrelevant.”

Until the Industrial Revolution, the climate was dangerous for all human beings. Since then, we have marched steadily toward “climate mastery.” Fewer people die today from the weather than at any time in history. “We don’t take a safe climate and make it dangerous,” according to Epstein. “We take a dangerous climate and make it safe.”

Alex Epstein’s book is a breath of fresh air in this polluted opinion climate. The Moral Case for Fossil Fuels shows why fossil fuels are good for human flourishing in general and good for the world’s poor in particular. Epstein is a true friend of the earth—an earth inhabited and made better by human beings.

Read the whole review here: The Earth Is Not a God: The false theology of radical environmentalists – Jerry Weinberger, CITY JOURNAL

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Quote of the morning: “You’ve heard it said that the science is settled. And it’s true.”

“You’ve heard it said that the science is settled. And it’s true. It is settled–settled
beyond the possibility of any dispute. A fundamental, inescapable, indubitable
bedrock scientific principle is that lousy theories make lousy predictions.”

- William Briggs, ‘Left Panics Over Peer-Reviewed Climate Paper's Threat to Global Warming Alarmism

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The problem with karaoke

Comedian Toby Acton has a problem with the words. Just wot in ‘eck are they all singing about?!

[Hat tip Alice J.]

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Tuesday, February 24, 2015

And the results of Christchurch’s four-year scientific experiment are …

The Press, Christchurch’s newspaper, says investors are losing confidence in Christchurch.

Is it any bloody wonder?

For four years now your government has been carrying out a multi-year scientific experiment in central planning. And outside their centrally-planned “core,” the city is thriving. Inside, not so much. Indeed, not at all. Investors and everyone else don’t want anything to do with anything there.

Inside the former central area, central government, Christchurch Council and Canterbury Earthquake Recovery Authority ( CERA ) bureaucrats foolishly locked it all down for over 2 years, before putting on a further head lock with a top-down plan delivering only uncertainty and unrealism. What the earthquake couldn’t do, they did themselves, “with blissfully ignorant and romantic planning, divorced from reality, deliberately forcing unaffordable and unsustainable new rentals.”1

Between lock-outs, throw-outs and the associated uncertainties of a centrally-planned fantasy, business owners and would-be investors just can’t be bothered trying anymore.  Now, says the Press, the 100-day blueprint was 935 days ago

To stand in central Christchurch, you could be forgiven for thinking that you were in a city which had lost its soul. Of course, what we all learned in Christchurch’s magnificent response to its tragedy was that the soul of a city lay in its people. But relatively few people come to the middle of town any more. They won’t until normal human everyday activity returns in force – and this is not wholly the sort of activity that is provided by a convention centre or a stadium. The suspicion is growing that the sort of Christchurch that we all want cannot be legislated for by Cera or its central city blueprint. The privately-funded labour of love that has returned the Isaac Theatre Royal to us in this past year has done more for central city vibrancy, so far, than has come out of the blueprint.

There are several puzzling things in all this.

The first is analysts like ASB’s Nick Tuffley who sees “no clear reason” why confidence in the region should have dropped so much, and Wealth general manager Jonathan Beale who says the result was "a big surprise." The only puzzling thing is that these analysts are puzzled. They should check their premises about where and how wealth is generated.

The second is the central planners, who after four years of Fortress Christchurch refuse to concede they are the problem, not the solution, insisting instead on carrying out  a replay of the scientific experiment of Joplin and Tuscaloosa – or of East and West Berlin.

The third is your central government, who watch all this happening only to continue ordering up more of the same.

And the fourth is you folk in Christchurch who, despite living with the results every day, and suffering all the health and economic problems because of it, continue to vote for and support your destroyers.

So who are the really stupid ones?

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Happy birthday Carl Menger, founder of causal-realist economics

Principles of Economics by Carl MengerI nearly forgot to mark the birthday of one of the greatest economists who ever lived, Carl Menger.

He was the man who explained economic value.

Who brought Aristotle into modern economics.

Who brought causality into economic reasoning.

Who started a school of economics that still relies on his implicit causal-realist methodology, whatever explicit denials might say.

Unlike his contemporaries, Menger was not interested in in creating artificial, stylised representations of reality, but in explaining the real world actions of real people.

Economics, for Carl Menger, is not the study of rarefied aggregates but of purposeful human choice -- Menger's student Boehm-Bawerk declaring "that Menger's system had spanned the chasm between microeconomics and macroeconomics, finally establishing economics as a true science."

No wonder he is largely ignored today. Except by some of New Zealand’s most entrepreneurial billionaires.

As the founder of what became known as “Austrian economics,” Menger established its base as “causal realist,” declaring in the preface of his 1870 book that launched an intellectual revolution:

I have devoted special attention to the investigation of the causal connections between economic phenomena involving products and the corresponding agents of production, not only for the purpose of establishing a price theory based upon reality and placing all price phenomena (including interest, wages, ground rent, etc.) together under one unified point of view, but also because of the insights we thereby gain into many other economic processes heretofore completely misunderstood. [Emphases are mine]

As astute readers will have picked up, Menger was an explicit Aristotelian out to create a rational foundation for economics, and on that to build an integrated view of the nature and value of human economic life.

His causal-genetic method is rooted in Aristotelian metaphysics and epistemology. Menger thereby destroyed the existing structures of economic thought and established economics’ legitimacy as a theoretical science…
    Menger’s understanding of economic theory is essentialist and grounded in Aristotelian metaphysics. His causal-realistic economic method is a search for laws about actual, observable events. It follows that Menger’s economics is actually a theory of reality. Menger is concerned with essences and laws manifested in this world. For Menger, as well as Aristotle, what is general does not exist in isolation from what is particular.

imageHe explained that economic activity is all about values – that economic activity itself is inherently value-laden. It requires recognition not just of individuals’ own differing valuations of goods, but the understanding that the job of production begins with the realisation that goods have objective value. in his “General Theory of the Good,” he all but makes this point explicit. (He of course assumed he wouldn’t have morons in his wake for whom everything would need to be spelled out.

This theory of the good is where his seminal book and theory begins, and illustrates something of his method. He describes how four things must be simultaneously present in order for a thing to become a good, or, as he often puts it, to attain “goods-character”:

Things that can be placed in a causal connection with the satisfaction of human needs we term useful things[“Nützlichkeiten”]. If, however, we both recognize this causal connection, and have the power actually to direct the useful things to the satisfaction of our needs, we call them goods.
I
f a thing is to become a good, or in other words, if it is to acquire goods-character, all four of the following prerequisites must be simultaneously present:
    1. A human need.
    2. Such properties as render the thing capable of being brought into a causal connection with
       the   satisfaction of this need.
    3. Human knowledge of this causal connection.
    4. Command of the thing sufficient to direct it to the satisfaction of the need.

Given that “Our well-being at any given time, to the extent that it depends upon the satisfaction of our needs, is assured if we have at our disposal the goods required for their direct satisfaction,” what Menger is describing here is the very stuff of value creation1.

Menger in other words understood that economic activity itself recognises and is undertaken in pursuit of human values--specifically the value and prosperity of human life. This is what needs explaining. 

For him, life is the standard and final cause of all economic activity.

Don’t accept cheap imitations. Menger is the pre-eminent Aristotelian economist. He’s the real thing.

It is Menger’s birthday. The pleasure is all yours for the reading.


1. …and the beginning of a fully-blown defence of property rights.

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Dear Fellow Submissives: The State Is Our Christian Grey

http://d268xzw51cyeyg.cloudfront.net/wp-content/uploads/sites/5/2015/02/first-look-at-fifty-shades-of-grey-trailer_4upr.1920.jpg

Guest post by Jeffrey Tucker

The cultural panic about the enormous commercial success of 50 Shades of Grey has gone on for years, and, from that, you might get the impression that the story romanticises unspeakable things.

Though I’ve not read the book, my impression from the movie was entirely opposite. It is not a hymn to the secret glories of BDSM. It is a sophisticated allegory that takes apart, and ultimately condemns in the strongest terms, the psychological foundations of seemingly consensual human relationships that are actually based on dependency, abuse, and power.

For the already scandalized, here is a brief synopsis as I see it. Christian Grey is a good looking and rich owner of his own company who doesn’t actually seem to do any real work. He is interviewed by the naive Anastasia Steele, who fills in as a substitute reporter for her friend.

Grey is intrigued by her and he begins the seduction. He is ridiculously wealthy and generous, which impresses her, and he makes a huge fuss about Anastasia’s mysterious wonderfulness, which delights her. He proposes a relationship of a special kind.

But there is a catch, in the form of a contract. Grey, a victim of childhood sexual abuse who admits to being “50 shades of [effed] up,” wants her to agree to a master-slave relationship in which she must do all he tells her, and she must submit or be punished. He wants her consent to this relationship dynamic, on paper, but she understandably resists. The remainder of the story consists of his trying to persuade her to sign up for the deal, and he does this through more gifts, spending, time, attention, and small demonstrations of the dominant-submissive relationship to come.

imageYes, Anastasia likes Christian even though he intimidates her. Why is she drawn to him? It is not about the bondage and abuse. These are the downsides, the price she is being asked to pay for the relationship that she desperately wants to be normal and healthy. She is drawn to him because he is beautiful and rather epic, and because of the time and attention he gives her. He values her and she feels valued because of this, even though she is aware that his valuation is contingent on her agreeing to do things that disgust her.

The truly inspiring moment comes near the end. Anastasia decides to put Christian to the test, to see how far he is willing to go in inflicting pain and suffering on her. Once she experiences this, the scales fall from her eyes. The beauty of Christian, his money and his larger-than-life persona, no longer matter. She now sees him for what he is, a degenerate parasite who cares nothing about her as a person but rather only wants to use her to feed his maniacal power lust. She says no, and walks away. Blessed free will!

As with most pop culture hits (the movie is still #1 at the box office as I write), the story says something important about our times.

And yes, that means politics.

Power and abuse can take many forms: parents, teachers, bosses, ministers, anyone in authority. But the single largest, costliest, most aggressive, and persistently abusive relationship in our lives is with government. Our Christian Grey is the ruling elite in the deep structures of the state.

Like Mr. Grey, government can appear to be beautiful, prestigious, and enormously wealthy even though the source of its status and riches are unclear. Its goal is absolute power over us, and the opportunity to punish us when we don’t comply. But the direct use of force is not the best way to get there.

What government desires is that we sign the social contract. Only in this way is the state in a position to claim that it rules us only through our own willingness to submit. The very legitimacy of the state depends on it.

imageHow does the state go about getting us to sign? It offers gifts. It shows us glorious possibilities. In the movie, Mr. Grey takes Anastasia for rides in cool cars, helicopters, and gliders. Government does the same, giving us a chance to experience things that we could not otherwise access: huge rallies, parades that show off military might, grand monuments, national parks, trips to space, the power to print money, and so on.

And what does government promise us will come at the end? We will have security, safety, prosperity, an end to the exigencies of life’s uncertainties, and so on. In fact, we can pretty much have everything we want, all our heart’s desires, but only once we consent to allowing government to be the dominant and we agree to be the submissives. Also, if we make the deal, we enjoy the special satisfaction that comes with pleasing our benefactor, who will be very happy indeed.

There is a sense in which the state is devilishly clever, just like Mr. Grey. He sought to isolate and monitor Anastasia’s every move: her comings and goings, her social contacts, her business associations, what she ate and what she drank. It’s all about control. Government does this to us every day through attempted censorship, surveillance, prohibitions, and regulations, always with the claim that it is for our own good. Do we like it? Not entirely, but what is the alternative? The promised benefits of this relationship are impossible to ignore.

Mr. Grey was careful throughout his perverse courtship only to give hints at the abuse that was to come, and these samples that he revealed were not entirely intolerable. So it is with the state’s plunderings of our property, at least at first, and the state’s regulations of our lives, at least at first, and the state’s prohibitions, at least at first. Even its small skirmishes with its enemies (all bad guys) seem justifiable at some level.

What the state does not show us — but wants us to agree to in advance so that it can avoid moral culpability — is its mass confiscations, conscription, internment camps, wars, and even mass murders. By the time these horrors arrive, the state wants us thoroughly socialised into its ways, to judge its actions outside conventional moral frameworks — our relationship is very special indeed — so that we not only do not regret them but rather celebrate them as the very embodiment of our highest ideals.

Look how magnificent the achievements of this perfect romance!

What is this contract that the state wants us to sign? What are the signs and symbols of our consent? This is where elections, representative government, and the illusions of democracy come into play. Through these institutions we are assured that no matter how egregious things seem to get, we are all really just governing ourselves: it is of, by, and for the people. No one is ultimately forcing anyone to do anything.

We have, after all, agreed to our submissive state of being and we have permitted the dominant partner in our relationship to enjoy this status. What’s more, because of the social contract, if the state runs up debt, we really just owe it to ourselves. If it kills innocents abroad, “we” are only doing it to prevent a possible attack. If it bankrupts business with regulations and taxes, “we” are only bringing rationality to the commercial sector.

Power relationships are complex like this. They are not usually about conquest and sudden impositions against our will. To maximize longevity and minimize the chance of revolt, power relationships involve seductions to overcome our innate resistance to the idea of being ruled by others. Freedom is not usually taken away; it is given up in exchange for something that we temporarily find even more appealing. That was Mr. Grey’s goal. It is also the goal of the nation state as we know it.

This is why this film is so important. It complexifies and deepens our understanding of the nature of power and reveals the psychological foundations of our relationship with the political order — and does this better than any film I’ve ever seen in a long while.

I mentioned earlier that glorious moment in the film when Anastasia develops a new consciousness of the ghastly pathology that animates the heart and soul of her very dangerous partner. She realizes that he only has power if she is willing to grant it to him. She stands up, covers herself in protection, tells him he will never touch her again, gets dressed and heads to the elevator. He calls for her but she interrupts with one strong word: NO!

“How does he have any power over you except through you?” asked the Renaissance political thinker Etienne de La Boétie. “From all these indignities, such as the very beasts of the field would not endure, you can deliver yourselves if you try, not by taking action, but merely by willing to be free. Resolve to serve no more, and you are at once freed. I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer; then you will behold him, like a great Colossus whose pedestal has been pulled away, fall of his own weight and break in pieces.”


Profile pictureJeffrey Tucker is Chief Liberty Officer of Liberty.me (http://liberty.me/join), a subscription-based, action-focused social and publishing platform for the liberty minded. He is also distinguished fellow Foundation for Economic Education  (http://fee.org), executive editor of Laissez-Faire Books, research fellow Acton Institute, founder CryptoCurrency Conference, and author six books.

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Monday, February 23, 2015

‘Net neutrality’ in a cartoon or two…

So how does it work?

Because "nothing says forward-looking for the 21st century like a regulated utility."

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[Pics by Nate Beeler, Dana Summers. Hat tips A.J. Ellis, Scott Powell]

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Meet the bureaucrat who had the courage to tell the truth

Guest post by Simon Black

It’s not very often that you hear a senior government official refer to their economic situation using the word ‘crisis.’

Yet with uncharacteristic bluntness of any government official anywhere, at least one senior Chinese government official is sounding the alarm bells.

And he would know.

Guan Tao oversees the foreign exchange of China’s $4 trillion stockpile of reserves, so he has an incredibly unique view of capital flows and currency movements in and out of the country.

Currency movements and capital flows are extremely interesting indicators.

They don’t necessarily tell you that there’s a problem. They tell you that people have figured out there’s a problem.

Look at Greece, for example.

The government is bankrupt, another default is looming, and the country is literally about to run out of money. It’s pretty obvious that there’s been a problem for a very long time.

But the central bank data in Greece now shows that roughly 8% of all customer deposits have vanished from the Greek banking system so far this year.

That’s an astonishing figure.

Again, a currency movement like this doesn’t tell you that there’s a problem. All the other data can tell us that.

The currency movements out of the banking system tell us that the people of Greece have figured it out; that they’ve lost confidence in the system.

This is extremely important, because the entire global financial system is only held together by a very thin layer of confidence.

Nearly every western government is bankrupt. Central banks are borderline insolvent. Banking systems are extremely illiquid.

Everything about this system is fundamentally weak. And the only reason that people aren’t panicking is because no one else is panicking.

Like a very thin piece of glass, the tiniest chip can turn into a crack -- and ultimately shatter the confidence in this system. That’s exactly what happened in 2008.

Major currency movement and capital flows tell us that people are starting to panic.

It’s happening in Greece. And it’s happening in China.

Mr. Tao informed the audience that the capital flight from China in December alone amounted to $20 billion, and that was just from official channels. The true amount could be four times greater.

This is significant for a number of reasons:

a) It’s happening.

Tens of billions of dollars are fleeing China, which is arguably the largest economy in the world. This does not bode well at all for the global economy.

b) They’re admitting it.

Again, it’s ridiculously unusual for a senior government official, ESPECIALLY IN CHINA, to admit to an audience, “yeah, people are taking their money and getting the hell out of dodge.”

Moreover, Tao even told his audience that China’s financial conditions “looks more and more like the Asian financial crisis” of the 1990s, and that we can “sense the atmosphere of the Asian financial crisis is getting closer and closer to us.”

(Our Chief Investment Strategist said the exact same thing last year.)

Such brutal honesty is certainly welcome. But it’s akin to career suicide.

c) If people are taking their money out of China, with all of its growth and savings, what does that say about other bankrupt nations?

Europe is a complete basket case and will likely go from bad (Greece) to worse (Italy).

Japan is a terminal failure, currently spending over 25% of its tax revenue just to pay interest.

And, perhaps just due to process of elimination, everyone seems to be looking to the United States as the beacon of growth and stability right now.

I’m sorry but this just doesn’t compute.

The US Federal Reserve on a mark-to-market basis is borderline insolvent. The US Federal government actually IS insolvent (based on their own financial statements).

The US banking system is EXTREMELY illiquid and has once again loaded up on risky loan packages (more on this in another letter).

How exactly is this safe?

It’s not. In fact, it’s downright ugly. And not even less ugly than the others.

Bottom line, there are very few safe places out there. Each of the governments has royally screwed up, and at this point, they’re all interconnected.

Greece and Italy cannot fail without devastating much of Europe. Europe cannot suffer without causing problems in China. China cannot slow down without causing major problems in the rest of the world.

Everything is connected.

So it’s simply wishful (and foolish) thinking to simply presume that the US, with its $18 trillion debt level and nearly insolvent central bank, can somehow be ‘all good’ while other nations are haemorrhaging cash….


20100202-simonSimon Black is is an international investor, entrepreneur, permanent traveller, free man, and founder of Sovereign Man. His free daily e-letter and crash course is about using the experiences from his life and travels to help you achieve more freedom.
This post first appeared at his website Sovereign Man.

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Open letter to Ron Paul: Reclaim Mises and true liberalism

This open letter to Ron Paul written by three Students for Liberty campus coordinators has got tongues wagging, because it points out uncomfortable truths apparent to young freedom lovers that older ones have brushed under the rug --- i.e., racism and bigotry in the writings of Ron Paul and other libertarians, including an Institute using the name of Ludwig Von Mises advocating some ideas Mises himself would find repugnant.1 Issues that must be addressed, they say, as “we sit here on the verge of a changing libertarian movement.

Dear Dr. Ron Paul,

We would like to preface this letter by pointing out it is written with the utmost respect and appreciation for all you have done to contribute to the freedom philosophy and human liberty. However, as principled supporters of liberty, we find your appearance at the International Students For Liberty Conference troubling for a few reasons. Most of which relate to your past and current associations with certain individuals and organizations that we find un-libertarian.

We believe many of the people you have aligned yourself with and continue to align yourself with are libertarians only in name and their true ideology is one more akin to a bigoted and authoritarian paleo-conservatism. Your appearance at Mises Circle in Houston, Texas just a few weeks ago is a prime example of this.

The prevalence of an age gap in the libertarian movement has been underscored by the ideas discussed in conferences such as the Mises Circle and put forth by the Mises Institute itself. “Millennial” or “Second-wave” libertarianism is not going away and there seems to be irreconcilable differences between these new libertarians and the old guard, which includes figures such as Lew Rockwell, Hans Herman-Hoppe, Walter Block, Gary North, and yourself. In this letter, we would like to highlight the downright absurdity promoted by this obsolete style of thinking, as delineated in the racist, homophobic, and sexist undertones present in these thinkers’ writings.

The themes of bigotry at the Mises Circle and in many of your colleague’s writings are obvious. At the Mises Circle, Lew Rockwell, founder and chairman of the Mises Institute, compared the life of people under modern nation states to literal chattel slavery. We admit the state is a gang of thieves writ large. But this analogy is downright offensive to people have suffered actual chattel slavery as well as people who have relatively great living standards under modern states. Libertarians can expose the evils of statism without resorting to bad metaphors with blatantly obvious racist undertones.

Hans Herman-Hoppe, distinguished fellow of the Mises Institute, wrote just last year that,
 
       “it is societies dominated by white heterosexual males, and in particular by the most successful
        among them, which have produced and accumulated the greatest amount of capital goods and achieved
         the highest average living standards.”
Hoppe has also advocated violence against homosexuals and other people who live lifestyles he doesn’t approve of,
  
     “There can be no tolerance toward those habitually promoting lifestyles incompatible with this goal.
         They-the advocates of alternative, non-family-centred lifestyles such as, for instance, individual
         hedonism, parasitism, nature-environment worship, homosexuality, or communism-will have to
        be physically removed from society, too, if one is to maintain a libertarian order.” 
The racist and homophobic themes in these passages speak for themselves.

Walter Block, senior fellow at the Mises Institute, has argued, “Feminists and gays aren’t libertarians.” Also on the topic of homosexuals, Block has written,
        “If a seventeen year old is an adult, and voluntarily wants to have sex with an adult homosexual man,
        I may not like it. I may be revolted by it.”
If that wasn’t clear enough, Block has made his bigoted views explicit,
        “I am a cultural conservative. This means that I abhor homosexuality, bestiality, and sadomasochism,
        as well as pimping, prostituting, drugging, and other such degenerate behaviour.”
In addition, he has put forth the idea that “lower black IQs” could explain productivity differences between blacks and whites. Again, the arguments speak for themselves.

Gary North, an associated scholar at the Mises Institute, is an outspoken Christian Reconstructionist and supporter of biblical theocracy. North advocates capital punishment by means of stoning for women who lie about their virginity, blasphemers, nonbelievers, children who curse their parents, male homosexuals, and other people who commit acts deemed capital offense in the Old Testament. These views are certainly not representative of the libertarianism we’ve come to know and love.

And then there’s you. The now infamous newsletters that had your signature several years ago contained rhetoric referring to people of colour as “animals”, asserted that homosexuals with HIV “enjoy the pity and attention that comes with being sick,” and went so far as to sanction anti-semitic views.

When questioned about these newsletters in 1996, you told the Dallas Morning News,2
        “Given the inefficiencies of what DC laughingly calls the criminal justice system, I think we can
        safely assume that 95 percent of the black males in that city are semi-criminal or entirely criminal.”

You didn’t dispute the newsletters and you certainly never condemned this: “If you have ever been robbed by a black teenaged male, you know how unbelievably fleet of foot they can be,” which appeared along with your signature.

Bigoted subtext has consistently been condoned by so-called “pro-liberty” individuals; a contradiction of the most offensive degree. Liberty cannot exist if individuals of any group are viewed as inferior, whether it is outright, or merely in the connotations of an argument. Suppression means the absence of liberty; something the founding fathers of Libertarianism built up a wealth of rhetoric against. Hypocrisy to this extent cannot be permitted any longer in the libertarian movement.

In Ludwig von Mises’ classic work, Liberalism, he identified tolerance as a fundamental value of a free society, “Liberalism demands tolerance as a matter of principle, not from opportunism. It demands toleration even of obviously nonsensical teachings, absurd forms of heterodoxy, and childishly silly superstitions. It demands toleration for doctrines and opinions that it deems detrimental and ruinous to society and even for movements that it indefatigably combats. For what impels liberalism to demand and accord toleration is not consideration for the content of the doctrine to be tolerated, but the knowledge that only tolerance can create and preserve the condition of social peace without which humanity must relapse into the barbarism and penury of centuries long past.”

This isn’t about guilt by association. It’s about condemning evil, illiberal ideas and being clear about your principles. You continue to hide behind your prestige, refusing to admit this intolerance exists, although it was your name signed on the papers, and you who allowed this bigoted mentality to perpetuate by being closely associated with the Mises Institute. As the icon of the libertarian movement, you have a duty to eliminate this intolerance, not sit back and let it destroy the cause you helped create.

Do you think the Ludwig von Mises Institute has really embraced its namesake’s crucial insight here?  Do you think you have? If not, then tell us. Condemn all forms of bigotry and intolerance as un-libertarian. Denounce these connections and the ideas of sexism, homophobia, and racism that have infected the Mises Institute and by extension the libertarian movement. Reclaim Mises and true liberalism. If libertarianism is to advance in the coming century, we must continue to build a community of peace, acceptance, and tolerance and whether you like it or not, it starts with you.

Sincerely and For Liberty and Tolerance,
Aarón Shelby Baca, Mackenzie Holst, and Cory Massimino

These three youngsters are asking the questions their oldsters should have been asking before them.

For my part, since I regularly recommend that readers head to the Mises Institute for rational writing in economics, I share Baca’s, Holst’s and Massimo’s serious reservations about their non-economic writing.

That is to say that when the economists of the Mises Institute write about economics, using the insights of the Austrian tradition of economics, there are few better – as last year’s much-needed Bailout Reader should demonstrate. When the Institute’s economists write outside their field however, they are universally awful. Specifically, they are awful on intellectual property, on foreign policy, on religion, on anarchy, and on how the South will rise again.  (On morning drinking, of course, they’re fundamentally sound.)
    And they’re not just awful: their writings on these subjects are in opposition to Ludwig von Mises’s own writings on these subjects – or the first four subjects, anyway.  So as a “Mises Institute” it’s only on economics (and morning drinking) they can be taken seriously on “what Mises would have said.”
    Just thought you should know. In my view, for all their heroic work in resuscitating
the economic thoughts and writing of Ludwig von Mises and his colleagues in the Austrian tradition, the Mises Institute should more accurately be re-named the Rothbard Institute, with all that implies.

Perhaps the problem comes from the notion that you can sever libertarianism and economics from philosophy itself, something Ayn Rand warned against. Here, for example, in 1946, discussing Leonard Read’s new organisation, the Foundation for Economic Education:

"The great mistake here is in assuming that economics is a science which can be isolated from moral, philosophical and political principles, and considered as a subject in itself, without relation to them. It can't be done.
The best example of that is Von Mises' book Omnipotent Government. That is precisely what he attempted to do, in a very objective, conscientious, scholarly way. And he failed dismally, even though his economic facts and conclusions were for the most part unimpeachable. He failed to present a convincing case because at the crucial points, where his economics came to touch upon moral issues (as all economics must), he went into thin air, into contradictions, into nonsense. He did prove, all right, that collectivist economics don't work. And he failed to convert a single collectivist.
The organisation desperately needed at present is one for EDUCATION IN INDIVIDUALISM, in every aspect of it: philosophical, moral, political, economic—in that order. (That is the actual order in which men's thinking proceeds on these subjects.) As part of such a program, an education in sound economics would be essential and valuable. Without it, it is a wasted effort.

True that.


1. Hat tip to and loan of much this description from Keith Weiner.
2. Actually, the quotes are from Paul’s newsletters, but he didn’t dispute the newsletters and certainly never condemned them.

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