Friday, 11 May 2012

FRIDAY MORNING RAMBLE: It’s the ‘Gay Marriage’ edition

Big news of the week appears to be the issue that Dick Cheney and Joe Biden got to before Barack Obama: agreeing that same-sex marriage will not end civilisation as we know it. Or in Obama’s case: realising that same-sex marriage might be the only electoral issue on which he can separate himself and his 2012 Republican presidential opponent.
As such, it’s the first “real” salvo of the 2012 campaign.
One decision, many ripples – Steve Benen, M A D D O W   B L O G
Gays/Lesbians Should Not Fall for Barack's Gay Marriage B.S. – Michael Hurd,  D R   H U R D . C O M
MiSDiReCTioN... – Z E R O   H E D G E
Gary Johnson on Obama's Gay Marriage Remarks: "I guess the President is still more worried about losing Ohio, Colorado, North Carolina and Virginia than he is in doing the right thing" – R E A S O N
"It is good to see that after intense political pressure that President Obama has finally come around to the Dick Cheney position on marriage equality." -  R E A S O N
Gay 'Marriage' vs. 'Civil Unions': What's in a Name? – R E A S O N
Should same-sex marriage be legalized across the nation? – Tibor Machan, F R E E D O M  P O L I T I C S
President Obama Gets His Groove Back -  C A T O @ L I B E R T Y
Guest Post: Louisa Wall – Louisa Wall,  W H A L E   O I L
Major nz party leaders all support same sex marriage – David Farrar,  K I W I B L O G
When gay marriages are not being recognized it isn’t just that one is opposed to them 
– Tibor Machan, C L O V I S   N E W S   J O U R N A L

More important news this morning:
Survey shows porn habits start early -  N E W S T A L K   Z B

It’s odd there should any controversy about this: Of course people should take some responsibility for investing with schmucks.  And of course Brian Gaynor would disagree.
Missing the point on financial literacy – V I S I B L E   H A N D   I N  E C O N O M I C S

Government is the great fiction through which everybody
endeavours to live at the expense of everybody else.

               - Frédéric Bastiat

Q: Why does the entitlement state grow despite its obvious unaffordability? A: Because no one is willing to challenge the altruistic notion that we are our brother’s keeper. The only way to stop its growth is to reject this notion.
Why Making Altruism Voluntary Can’t End The Entitlement State – Don Watkins, L A I S S E Z   F A I R E

The latest concerted onslaught on the freedom of competition is licensing laws—laws “for your own good” that make goods and services less good, less available and more expensive. The American-based Institute for Justice summarises the he effects and requirements of licensing laws in all 50 states of the US.

TIME magazine has just given Ben Bernanke the kiss of death. They’ve put him on their cover.  (Be ready with your sick bag when you click the link.)
The men who caused the Great Recession  - P R A C T I C E   G O O D  T H E O R Y

Russ Roberts on Europe’s non-existent “austerity experiment”: “I’d like some facts. I have seen many articles on austerity. I can’t remember seeing any that suggest that government spending in any European country has actually fallen. Yes, there is talk of spending cuts or cuts in growth rates. But I’d like to see the data that shows the cuts have actually been implemented.
” How can a thoughtful journalist at a serious publication write that the Europeans have ‘carried out that experiment?’”
The austerity experiment – Russ Roberts,  C A F E  H A Y E K
Alternatives to austerity - Russ Roberts, C A F E    H A Y E K

Even mainstream economists aren’t impressed by government over-spending.
Robert Barro: Stimulus Spending Keeps Failing – W S J


He wasn’t just a beloved children’s author, you know. But here’s what happened when he wrote a book for adults…
Dr. Seuss's Little-Known Book of Nudes – A T L A N T I C

Australian Alan Moran says history suggests we have nothing to fear from China. “The implications of [China’s transition towards property rights and the rule of law] are that no longer will countries seize other countries’ resources. They, or their firms, can buy everything they want from willing sellers and such voluntary exchange has been central to achieving success. This respect for existing property rights means we have little reason to fear that the Chinese, if their march to world leadership is inevitable, will seek to project that leadership and use military means to impose unwanted economic outcomes.”
Which means we are at the end of history again?
End of History again – Alan Moran,  C A T A L L A X Y  F I L E S

“Bribery is made possible and necessary only by government interference in the marketplace.” Discuss, with reference to this case.
Don’t Blame Walmart for Bribery in Mexico – O B J E C T I V   S T A N D A R D

If this is Britain in 2020, is it NZ in 2025?
A Vision Of Future Britain? – D I C K  P U D D L E C O T E

The US is about to post a budget surplus you say? Come on, who are you kidding.
US Posts First Budget Surplus In 42 Months, And It Is Less Than Meets The Eye 
– Z E R O   H E D G E

Yes, they’re trying the same fiddles in the Australian budget. (Don’t think a struggling Bill English won’t be taking notes so he can try them all himself!)
The (Australian) Budget – C A T A L L A X Y  F I L E S

Should We Drop The Term “Capitalism”?

Interesting news for warmists relying on the argument from authority: more than 1000 dissenting scientists have now signed a report challenging man-made global warming claims made by the United Nations Intergovernmental Panel on Climate Change (IPCC) -- almost 20 times the number of UN scientists who authored the media-hyped IPCC 2007 Summary for Policymakers. Time for independent thinking, you think?
More Than 1000 International Scientists Dissent Over Man-Made Global Warming Claims 
- C L I M A T E   D E P O T

Man cannot exist without some form of philosophy, i.e., some comprehensive
view of life. Most men are not intellectual innovators, but they are receptive
to ideas, are able to judge them critically and to choose the right course, when
and if it is offered. There are also a great many men who are indifferent to
ideas and to anything beyond the concrete-bound range of the immediate
moment; such men accept subconsciously whatever is offered by the culture
of their time, and swing blindly with any chance current. They are merely social
ballast—be they day laborers or company presidents—and, by their own
choice, irrelevant to the fate of the world.
          - Ayn Rand, “What Can One Do?” in Philosophy: Who Needs It

Obama’s election campaign started with a flip flop on gay marriage, and was continued by the release a cartoon-based eulogy to cradle-to-grave government programmes and what they will do for a “composite” woman called “Julia.” The Iowahawk couldn’t help himself, however, and had to make a few changes…
Julia's Circle of Life: The continuing adventures of Barack Obama's favorite eyeless, mouthless government dependent – I O W A H A W K
Who the hell is "Julia," and why am I paying for her whole life? -   David Harsanyi, H U M A N  E V E N T S

Mitt Romney is “down wiv da kidz?” Uh, maybe not.
Mitt Romney Completely Misreads the Hopes and Dreams of Youth Voters
– Patrick Michaels,  F O R B E S

No, no, no, not that Julia – not our next-door neighbour’s PM. Mind you, her “composite cabinet” is a piece of work!

A group of concerned citizens is taking on the fight against fake pharmaceuticals. Is it a group of government bureaucrats? No, silly, it’s a group of entrepreneurs.
How entrepreneurs are leading the fight against fake pharmaceuticals  - A . E . I .

I’ll give you three guesses why you never heard about Steve Jobs’ Willy Wonka routine.
Steve Jobs, Willy Wonka, and Good Reason for a Torrent of Expletives – O B J E C T I V E  S T A N D A R D

Is Apple exploiting Chinese workers?

A question every youngster needs to ask and answer at some point in their lives:
What does one owe one’s parents? – A P P L Y I N G   P H I L O S O P H Y   T O   L I F E

A few tips here on how to develop your own Bullshit Detector.  Basic tip, tread cleanly and keep your shoes clean…
Tread Cleanly! -  G U S   V A N  H O R N

Did I just see another batch of graduates undergoing capping? Here’s some advice.
'Don't Go To Law School,' 'Move To Asia,' And 28 Other Pearls Of Wisdom For 2012 Grads -  F O R B E S

And if you’re staying on in academia, these are the degrees you should have taken.
World class delusions  – Eric Crampton,  O F F S E T T I N G   B E H A V I O U R

imageNow for the really important news: techie-friendly seating so you can cuddle up better with your tablet.
21st-Century Reading Chairs – W S J

It’s true:
25 YouTube Comments That Are Actually Funny – B U Z Z F E E D

This looks like a free event to bookmark for the weekend: A presentation by Barbara Arrowsmith on her Canadian Arrowsmith Program, founded on the philosophy that it is possible to treat learning disabilities by identifying and strengthening cognitive capacities.  If only someone could tell her how the Montessori system could underpin her work…
Helping Children with Learning Disabilities: Saturday 12 May, 10.00am - 11.00am – T H E  E D G E
The Woman who Changed her Brain: Sunday 13 May, 4.00pm - 5.00pm – T H E   E D G E
Interview [audio] – R A D I O   N E W   Z EA L A N D

And finally, if you haven’t yet been up Auckland’s North-Western motorway to the Hallertau brewery, you really haven’t lived.
NZ Craft Beer TV – Hallertau. Awesome. - B E E R   R E V O L U T I O N

Cheers, and thanks for reading
Peter Cresswell

[Hat tips and thank yous to Don Watkins, Yaron Brook, Maria Montessori Education Foundation, Practice Good Theory, Eric Crampton, Geek Press)


Thursday, 10 May 2012

Czar Sutton strangling Chch home-owners [update 4]

For months the bureaucrats destroying Cantabrians’ spirits “managing” Christchurch’s recovery have successfully avoided addressing the growing elephant in the room: there is simply not enough residential-zoned land in Christchurch.

There is not enough residential-zoned land in Christchurch because the planners have zoned the city that way—ring-fenced,  locked down tight, build only where you’re told—and won’t be letting anything like an earthquake change their tiny minds.

It was bad enough before the earthquake. But at a time when good houses and safe residential land in Christchurch have never been more in demand, it has now become disastrous. So disastrous that folk with good houses on bad land in red-zoned areas of Christchurch face demolishing their good houses--or trucking them to Dunedin or Timaru—instead of being able to relocate them on the good land that exists in abundance around Christchurch, but which the planning arseholes have deemed off limits.

All this would be thuggish and incompetent enough. The truly bizarre thing here however is that this is not news to anyone but Roger Sutton, i.e., the uber-bureaucrat appointed by Earthquake Czar Gerry Brownlee precisely to “coordinate” and cut through regulatory restrictions on recovery like this.

It turns out however that Brownlee’s favourite uber-bureaucrat wouldn’t know his arse from his elbow—or at least, claims to have never heard of problems like this. “The first I heard of [these] difficulties was today,” he told TV1’s Close Up yesterday.

The man is either incompetent or uncaring.

Get the hell out of the way.

PS: Eric Crampton has more, and in a much more measured tone. I can only commend him for his restraint.

UPDATE 1: At the Cantabrians Unite Facebook page Hugh Pavletich invites us to

compare the Roger Sutton on the Close Up clip  with the same guy back February 2011 getting those overhead powerlines through to New Brighton when he was CEO of Orion. The sad reality is that Sutton is having a very hard time indeed under Bruiser Brownlee, who has turned the CERA exercise in to a bureaucratic shambles. The focus of CERA with Sutton leading it from the outset with a small competent team (say around 6) should have been to sort out the Christchurch Council. Sadly the low wattage guys Key and Brownlee were never bright enough to see that. To understand why - one needs to read the Vanity Fair article on the failed Merrill Lynch "The Blundering Herd" - which shaped Key. Key is in essence a corporate bureaucrat himself, who couldn't solve a problem if he tried.

UPDATE 2: Yes, let’s be honest, bozos like these bastards are making every city in the country unaffordable—even without our own earthquakes! As developer Olly Newland says today, “building reasonably priced housing is a dying business, strangled by regulation.”

UPDATE 3: Bill English knows this. He told a Christchurch audience last week:

having affordable housing in Christchurch will be the single biggest determinant of the population of this city in the next 10 years because housing affordability in New Zealand is way out of line ...
    "In Christchurch we have an opportunity to create affordable housing and that will certainly attract people.
    "With respect to the business community, the planning processes, in particular up until recently, have lacked a strong focus on who actually rebuilds the city.
    "It's not the planners ... what rebuilds cities are investors who will take risks….”

He knows it. But he and his colleagues are doing nothing about it.

UPDATE 4: Commenter Mark, who I know knows the field, reckons I’ve been unfairly harsh about Roger Sutton, and misdirecting my anger about high land costs and restrictions on relocating homes:

Lack of subdividable land is not a huge problem in Christchurch. There is a significant amount of relatively cheap land around. If you took away all zoning rules overnight, it might decrease prices a little, but not significantly.
    What drives the cost up is a complex and lengthy resource consenting process, high engineering standards in terms of stormwater treatment etc, not to mention new (very conservative) seismic requirements for land and foundations…   

Not to mention consent costs, reserve contributions, development levies etc., ad nauseum…

I think the "problem" Sutton was professing ignorance of was not lack of land (because I too am unaware of that problem), but the covenants that private developers have against relocating homes.

On this, Eric responds:

I agree that the covenants are what some people want, and they shouldn't be interfered with. But I can't see how we'd have covenants on pretty much all new sections if we had easier processes for opening up new sections for development.

More in the comments.

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Portrait of a bureaucrat [updated]

“The ultimate basis of an all around bureaucratic system is violence.”
Ludwig Von Mises, On Bureaucracy

There are two kinds 0f bureaucrats: the Jobsworths and the Born-Agains. 

And frankly, I prefer the Jobsworths. They’re less dangerous.

As today’s example, let’s look at American bureaucrat Al Armendarize, regional head of the U.S.’s Environmental Protection Agency—in other words, the top environmental official for America’s oil-rich South and Southwest region in the organisation that inspired National’s Nick Smith to start his own EPA.

This was a guy with power and a passion to use it. A guy who saw his job as shutting down, or at least emasculating, the oil-rich producers in his region.

His "philosophy of enforcement," he told his staff, went like this:

It was kind of like how the Romans used to, you know, conquer villages in the Mediterranean. They’d go in to a little Turkish town somewhere, they’d find the first five guys they saw, and they’d crucify them. And then, you know, that town was really easy to manage for the next few years.

It’s the same "philosophy of enforcement” followed by every government department worldwide, isn’t it, from our own IRD to America’s TSA. “Crucify them!”

At least the Jobsworths just shuffle paper. But pricks like this can kill—as the family of New Zealander Paul Jenkins recently discovered to their horror.

Now I say this “was”  a guy with power because this particular arsehole has just lost his job. Not for telling the truth, i.e., telling his staff about how things are, but because a video of him telling his staff the truth eventually found its way onto the internet—posted by someone in approval of Armedarize’s power lust.

His crime was not being too honest. It was being found out.

But worry not.  As Kimberley Strassel notes,

Al “Crucify Them” Armendariz resigned from the Environmental Protection Agency this week, for the mistake of telling it like it is. All he leaves behind is an entire administration of Al Armendarizes.

Actually, that should read “entire administrations full of Al Armendarizes.” Because they’re everywhere. 


imageimageUPDATE: In case you’ve forgotten what the local variety of thug bureaucrat is like, shown here are genuine cartoons collected from a variety of Inland Revenue offices back when they were killing Ian Mutton.image

And just in case you can’t see clearly, or you think your eyes might be deceiving you, yes, that is a newsletter banner above showing a courageous IRD agent running a taxpayer through with a lance. And, yes, that is a picture of a taxpayer being hung from a meat hook.


Wednesday, 9 May 2012

Beautiful British bridges

“Beautiful British bridges,” a photo gallery appearing in today’s Telegraph, might sound like an oxymoronic title (something like “Australian culture” or “nomadic urban planning”), but remember Britain is where the Industrial Revolution started. And it started and was carried forward by engineers like Isambard Kingdom Brunel…


And you have gorgeous constructions like this one, the ingenious Firth of Forth Bridge in Edinburgh.





See the whole series here.


Recipe for a safe city = more immigrants [updated]

Picture a city full of immigrants, mostly illegal, the majority dirt poor, with easy access to guns and a town just over the river torn apart by drug wars and brutal killings.

What do you think: Safe, or not safe?

The answer, of course, is safe.  Very safe. In fact, the city I described—El Paso in the south-western American state of New Mexico Texas and just over the border from a city that plays host to around 160o murders a years—is among the safest big cities in North America, and also the happiest.

For the better part of the last decade, only Honolulu has had a lower violent crime rate (El Paso slipped to third last year, behind New York). Men's Health magazine recently ranked El Paso the second "happiest" city in America, right after Laredo, Texas—another border town, where the Hispanic population is approaching 95 percent.
    So how has this city of poor immigrants become such an anomaly? Actually, it may not be an anomaly at all. Many criminologists say El Paso isn't safe despite its high proportion of immigrants, it's safe because of them.
    "If you want to find a safe city, first determine the size of the immigrant population," says Jack Levin, a criminologist at Northeastern University in Massachusetts. "If the immigrant community represents a large proportion of the population, you're likely in one of the country's safer cities. San Diego, Laredo, El Paso—these cities are teeming with immigrants, and they're some of the safest places in the country."

Take that xenophobes. And understand this is no accident.

What's happening with Latinos is true of most immigrant groups throughout U.S. history. "Overall, immigrants have a stake in this country, and they recognize it," Northeastern University's Levin says. "They're really an exceptional sort of American. They come here having left their family and friends back home. They come at some cost to themselves in terms of security and social relationships. They are extremely success-oriented, and adjust very well to the competitive circumstances in the United States." Economists Kristin Butcher and Anne Morrison Piehl argue that the very process of migration tends to select for people with a low potential for criminality.

And outside a few talkback hosts and their callers, it seems most Americans welcome them.

You don't see "Latinos Need Not Apply" or "No Mexicans" signs posted on public buildings the way you did with the Italians and the Irish, two groups who actually were disproportionately likely to turn to crime. The implication makes sense: An immigrant group's propensity for criminality may be partly determined by how they're received in their new country.

Which has lessons for Europe, famously poor at integrating new migrants*.

"Look at Arab-Americans in the Midwest, especially in the Detroit area," Levin says. "The U.S. and Canada have traditionally been very willing to welcome and integrate them. They're a success story, with high average incomes and very little crime. That's not the case in Europe. Countries like France and Germany are openly hostile to Arabs. They marginalize them. And they've seen waves of crime and rioting."

A welcoming melting pot with a confident culture. That’s just another thing of which Europe is running very short.

* * * * *

* “Famously poor” does not however mean “completely disastrous.” News stories on rioting and crime make good headlines, and “good data on immigration and crime are hard to come by,” admit researchers, but suggest for a number of reasons the fact is “immigrants on the whole may not be more likely to commit crimes, but some immigrant groups seem more likely than others to be punished for crimes.”

[Hat tip Julian Pistorius]

UPDATE:  Oops, corrected my mis-located geography! “El Paso is in Texas, not New Mexico. Right on the border, though!”  (Thanks to that commenter.)


“What ‘savage’ spending cuts?”

The Eurozone monetary ‘Titanic’ sails blithely on, with new political leaders and old prancing around the decks unaware their hull is already cracked.

Meanwhile, old leaders and new—and the media who still take them seriously—talk of “austerity” as if austerity is being practiced, as if there have been dramatic reductions in spending, as if a swathe of cuts were being made across Europe to the state budgets that are sinking the Eurozone.

Take a look at this graph. Do you see anything like that at all? 


Is it “austerity” to keep adding to your ballooning bar bill, while promising yourself that this round you will drink slower?

The chart above comes from Veronique de Rugy of the Mercatus Centre, who notes that while European voters are said to have rejected their governments’ “savage” spending cuts, the overwhelming question must surely be “What “savage” spending cuts?”:

    Spain, the United Kingdom, France, and Greece — countries widely cited for adopting austerity measures — haven’t significantly reduced spending since 2008. As you can see on this chart:

  • These countries still spend more than pre-recession levels
  • France and the U.K. did not cut spending.
  • In Greece, and Spain, when spending was actually reduced — between 2009–2011 — the cuts have been relatively small compared to what is needed. Also, meaningful structural reforms were seldom implemented.
  • As for Italy, the country reduced spending between 2009 and 2010 but the data shows and uptick in spending 2011. The increase in spending represents more than the previous reduction.

    The most important point to keep in mind is that whenever cuts took place, they were always overwhelmed by large counterproductive tax increases. Unfortunately, that point is often overlooked. This  approach to austerity — some spending cuts with large tax increases — is what President Obama has called the “balanced approach.”
However, as I have mentioned previously, while this balanced approach may sound good and appeals to our sense of fairness and moderation, but it can be a recipe for disaster. That’s because it fails to stabilize the debt, and it is more likely to cause economic contractions…

Sam Bowman at the Adam Smith Insitute [hat tip Liberty Scott] observes of de Rugy’s chart:

It tells a different story to the popular narrative that European voters have tried and rejected austerity. In fact, they have hardly tried it at all, returning generally to 2008 levels of government spending. France has not cut at all, yet it has just elected the patron saint of mediocrity, Francois Hollande. Not that Sarkozy was much better. De Rugy comments:

First, I wish we would stop being surprised by what’s happening in Europe right now. Second, I wish anti-austerity critics would start acknowledging that taxes have gone up too–in most cases more than the spending has been cut. third, I wish that we would stop assuming that gigantic “savage” cuts are the source of the EU’s problems. Some spending cuts have been implemented in a few countries … [but] the overwhelming take away from the European experience is that a majority of governments haven’t really implemented spending cuts, large or small, and some have even continued to grow.

What European voters have rejected is the idea of austerity. The very suggestion that their governments should live within their means is, apparently, unacceptable to the majority of voters in France, Greece and, as seems likely, the Netherlands. Hollande may be a nonentity, but the National Front candidate, Marine Le Pen, polled 18%, and the far-left Jean-Luc Melenchon 11%. Both seem likely to do well in next month's parliamentary elections. Golden Dawn, Greece's Nazi Party, has just polled 7%, the Communists 8.5%.

This is worrying stuff.

Isn’t it just.

The Greek government will be out of money in June—whoever decides to take power there, with whatever resulting chaos and (let’s hope not) bloodshed. Popular wisdom (which to be fair, is usually neither wise nor popular) has it overnight that Greece will be out of the Eurozone in a month. In any case, it must either leave or be left. Others will and must follow.

Will popular wisdom ever, do you think, realise that the shoehorning together in a monetary union of countries as disparate as the PIIGS and the Germans was never going to work?  (In terms of economic freedom, the Heritage Foundation ranks Greece for example as "mostly unfree" and one of the most heavily stultified economies in Europe. Germany on the other hand is ranked as “mostly free” and is picking up the tab for the all the Euroweenies. See pic right.) Will the folk who matter realise that if you spun a globe and stopped your finger 12 times on 12 random countries, they just might make more sense for a monetary union than the euro zone?image

Sure, the classical gold standard operated smoothly for nearly six decades before being blown apart by war, benevolently distributing price signals and the necessary capital around a world experiencing its first industrial revolution—tying together in effective monetary union countries that changed so much over those six decades they wouldn’t even recognise themselves!

But the monetary union of the classical gold standard was not the straitjacket of the Eurozone.  Its set up allowed economies to breathe and grow. The settings of  the Eurozone on the other hand seemed designed only to encourage bad behaviour and to make them choke. On debt.


Tuesday, 8 May 2012

European ‘Titanic’ sails blithely on [updated]

"Despots and democratic majorities are drunk with power. They must reluctantly
admit that they are subject to the laws of nature. But they reject the very notion of
economic law . . . economic history is a long record of government policies that
failed because they were designed with a bold disregard for the laws of economics."
                           - Ludwig Von Mises

The economic future of Europe is now certain. It looks like this:

The sinking of the Titanic, commemorated in recent weeks, has parallels with the sinking of Europe—a process that has only accelerated in recent days with the election of governments promising voters they can eat their cake and have it too.

The Titanic hit an iceberg, took on water, and sank.  Nothing could save it--not pumps, not bailing, not wishing the huge hole in the side would go away. One by one its non-watertight bulkheads filled up with water, the great ship broke in half, and it went to the bottom taking thousands of souls with it.

The parallels should be obvious: European economies hit an iceberg and are now sinking because of the inrushing waters of their governments’ debts—debts accumulated in part because of decades of welfare and years of overspending, and in part because of a futile attempt to prop up all the bad positions exposed in the crash. They wished the reasons for the crash would go away, and hoped a mountain of government debt would fend off reality.

They were mistaken. It is the inrushing tide of government debt that will now sink them.

It has been said that in rejecting the ruling parties this weekend French and Greek and British voters were protesting the “austerity” measures adopted by their governments. But not one of these governments had even bothered to cut their over-spending (which might be defined as spending more than you take in). None had elected to begin what might have been the life-saving process of cutting their coat according to their cloth; none  had chosen to spend less than it took in.  In all these places, and in places with even greater reason to face reality rather than fake it, the most that was ever done was just to reduce the rate at which their overspending  was allowed to accelerate.

This was and is insane. When your boat is sinking by an incoming tsunami of government overspending, it is not “austerity” to begin bailing out your ship with a teaspoon.

Yet this is all those governments had ever agreed to do. And now Europeans have voted for parties promising to to take away even the teaspoons, and to effectively rip an even bigger hole in their hull.

Which means the end will be even closer than before. Because the newly elected democratic majorities’ commitment to overspending will deliver the coup de grâce to any hope of .  This is the moment when—like the Titanic—the back of the Leviathan is broken and the Eurozone splits into two and sinks..

It is still argued that the overspending was necessary. That without government borrowing and spending taking up the slack,  European countries would have faced economic disaster. Yet because the government spending allowed the malinvestments exposed in the crash to continue—allowed all the bad positions to survive—the response has effectively guaranteed that recovery will not happen (recession being loosely defined as the period whereby bad positions are extinguished and the economy exposed as being “out of whack” begins to rebalanced and re-start), and bad government over-spending has effectively crowded out what could have been good private capital spending, i.e., the type of spending that must precede any genuine recovery. The result has been a sinking ship of stagnating economies, zombie companies, and huge and increasing unemployment

This is not despite the governments’ “stimulus,” but because of it.  The governments’ responses ensured recovery could not happen—and it invited the debt tsunami that is now going to sink them.

What they were relying on—and by “they” I mean every overspending Eurozone government, whether elected in or elected out—what they were all relying on (they hoped) is that they could eat their cake and have it too.  And they hoped this  could happen because the Eurozone arrangements virtually guaranteed (they thought) that while they were eating their cake the Germans would carry on baking it for them.

But even a guilt-ridden Germany can only shoulder so much. In what Peter Schiff calls "a startlingly frank assessment of the current problems in Europe", Dr. Andreas Dombret of the Executive Board of the Deutsche Bundesbank (the German central bank) makes the problem plain:

...Exchange rate movements are usually an important channel through which unsustainable current account positions are corrected....In a monetary union, however, this is obviously no longer an option. Spain no longer has a peseta to devalue; Germany no longer has a deutsche mark to revalue. Other things must therefore give instead: prices, wages, employment and output.

The question now is which countries have to shoulder the adjustment burden. Naturally, this is where opinions start to differ. The German position could be described as follows: the deficit countries must adjust. They must address their structural problems, reduce domestic demand, become more competitive and increase their exports.

In banker speak, that means he sees no appetite for Germany to carry on baking the Southern Europeans’ cake for them unless they intend to adjust.

And since European voters are making plain they would rather sink than make any adjustment at all, that makes what happens next all but inevitable.

Glug, glug, glug.


Europe’s election results remind Don Watkins of a scene near the end of Atlas Shrugged.

“…Sure, I could pretend—and I wouldn’t save your economy or your system, nothing will save them now—but I’d perish and what you’d win would be what you’ve always won in the past: a postponement, one more stay of execution, for another year—or month—bought at the price of whatever hope and effort might still be squeezed out of the best of the human remnants left around you, including me. That’s all you’re after and that is the length of your range. A month? You’d settle for a week—on the unchallenged absolute that there will always be another victim to find.”

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Is this state control of reproduction? [updated]

Welfare Minister Paul Bennett has announced beneficiaries already taking the Domestic Purposes Benefit will be “encouraged” to take contraceptives to avoid having further children while sucking on the state tit—to the extent, apparently, of giving them free contraceptives which they will of course be expected to use.

It’s as if women are too dim to realise, if the state didn’t point it out to them, that having sex without protection invites impregnation—as if all that’s needed to lower the birth rate of beneficiaries is for contraceptives to fall fortuitously into their hands.

As if those women weren’t getting pregnant by choice.

So is this state control of reproduction? Well, yes it is: rest assured that those employed by the state will be offering “incentives” to beneficiaries  to cooperate with the plan—and when bureaucrats begin “strongly suggesting” to beneficiaries they should take up an “offer,” they expect their “suggestions” to be obeyed. (As former minister Marian Hobbs once explained the state’s view of “encouraging” behaviour the stale likes, “we start with encouraging, but there’s always the big stick.)

Every beneficiary is aware of the big stick.

So it is state control of reproduction.

But that’s the deal you make when you accept government as your senior charity provider, isn’t it. Whatever they do by definition involves coercion.

Because when private charity providers can and do offer whatever incentives they are able to contrive to encourage the recipients of their charity to become more independent, those incentives are offered by private organisations in the context of offering voluntary charity. But when the state doles out charity not only is it given begrudgingly, but every incentive imposed to change or improve behaviour comes with accusation of the state meddling in people’s affairs.

Like I said, this is the deal you make when private charity is crowded out by the state. And why incentives to get off state welfare are so rarely introduced.

Because as the kerfuffle around the introduction of even this very mild form of incentivisation indicates, the very real fear of coercion in private affairs is enough to make everybody queasy. Which is just one more reason the state is not the right organisation to distribute charity.

UPDATE:  “As pathetic as it is, Paula Bennett’s attempts to encourage mothers on the DPB to use contraceptives is a classic example of the state trying to fix a problem that was caused squarely by the state,”  says Peter Osborne, Libertarianz spokesman for Social Welfare. “Ms Bennett would do better handing out her condoms to her fellow politicians, so we would no longer have to endure the next generation of their ilk.”


Monday, 7 May 2012

DOWN TO THE DOCTOR'S: More Lessons From Britain

_McGrath001This week,  Libertarianz leader Dr Richard McGrath has been watching the demise of British politics.

Watching the machinations of UK politics is often instructive, as they so often pre-empt events here. The weekend’s local body election result is a case in point, in which the Conservative Party lost hundreds of seat and ended up eight "percentage points" behind Labour. Their Liberal Democrat coalition partners also lost a lot of ground, and there is now serious doubt whether they should still be regarded as a major political party.

There have been already been calls after this disaster for Lib Dem leader Nick Clegg to stand down—and Tory leader David Cameron will be wondering what he can do to avoid a rout at the next general election.


It was heartening too to see the still youthful UK Independence Party (UKIP) attract 14% of the vote in the constituencies it contested.  Its leader, Nigel Farage, is a charismatic, intelligent man whose speechesin the European Parliament are always entertaining, and in national polling, they recently overtook the Lib Dems as Britain's third party.That a party calling itself "a libertarian, non-racist [political] party seeking Britain's withdrawal from the European Union" can attract support like this without either the money or profile of the other parties is highly encouraging.

But the most stunning statistic from the UK’s local elections was the overall percentage turnout of voters: a miserable thirty-two percent.

Thirty-two percent!

Yep: just sixty eight percent of voters–more than two-thirds of the electorate—refused to dignify the political process or the pygmies on offer with their participation.

This is a real milestone. To dismiss it as apathy or laziness, as many have, is nothing less than arrogance and contempt for the intelligence of voters. There are plenty of opportunities to cast early votes at an election, but when voters decide to become non-voters because the parties represented are seen as undeserving of sanction, why bother?

_GorgonBRownIt is now apparent (as if it wasn't previously) that the UK’s change of government in 2010 was due to rejection of ghastly Gorgon Brown rather than any identification with out-of-touch upper class twat David Cameron. Now that the British public are fully aware of Cameron's betrayal of conservative principles, many of them have abandoned the Tories and thrown their support behind UKIP.

And with so many parties betraying what they claim to stand for, many of them have abandoned voting altogether as a waste of time. And who can blame them?

Typical of the ignorance and arrogance of the Conservative Party is the suggestion by its chairman, the egregious Baroness Warsi, that UKIP have picked up the votes of former BNP voters. In fact, you could hardly find two political parties more diametrically opposed in outlook and policy. The BNP are a bunch of socialist xenophobic racists (though, commendably, in 2009 their leader described Islam as a cancer); the UKIP are a team of non-racist libertarian individualists who want Britain to exit the European Soviet Union. Warsi's appalling ignorance is a symptom of the malaise which has has crippled the British Conservative Party and will hopefully destroy it.

There are many lessons from the stay-at-home vote, or should be.  For one, some honesty from the research companies conducting political polls is long overdue: The number of people who decline to offer preference for any candidate or political party should be listed, and percentage results for parties and candidates should be adjusted accordingly.

And when 'None of The Above' is the second highest polling option, the makeup of parliament should reflect this.  (Wouldn’t any parliament be improved if the chamber was permanently two-thirds empty. Ditto for the press gallery.)

Which sets me to thinking. Nature abhors a vacuum. So perhaps it is time for a 'None of The Above' political party to emerge here, to represent the 27% of New Zealanders completely disenfranchised by the current parliamentary composition...

See you next week!
Doc McGrath

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