Two little things

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How do these things happen? You turn your back for 5 minutes and just because the odd bank has fallen over people decide to raise up again two of the more scabrous ideas from the horrors of human history. What is it about testing times that makes people suggest that we give up civilisation?

The first of these little things is the fuss over the pension arrangements for Sir Fred Goodwin. Yes, it's a huge pension, yes he was at the helm when the bank ran aground and no, I'm not all that chuffed with the idea that he'll get just shy of £700,000 a year for life either. But it is a contract. Perhaps it's a contract that shouldn't have been signed, that we wish hadn't been signed, that if there's a legal loophole in it we might exploit such, but as matters stand as I write it's a legal contract which was, amongst others along the way, signed off by a Government Minister.

To repudiate it because the populace, or the more populist of the votestealers in Parliament, desire such is simply the rule of the mob. The antithesis of one of the things that makes up civilisation, the rule of law, the sanctity of contract, call it what you will. We are not and should not be ruled by the whims of men but by the arrangements which we have signed up to beforehand and if we regress from that to doing whatever tricks the jeering crowd would call for inbetween their Hogarthian quaffs of gin and window breaking then we might as well give the whole thing up and go back and live in the trees.

The second is this extremely strange idea about compulsory national volunteering. Leaving aside the oxymoronic nature of the phrase I suppose we can at least use it as proof that there's none so illiberal as liberals imposing their pet schemes upon the hoi polloi. Other than that it's a nonsense, a truly horrendous idea that any civilised being should be ashamed of even considering, let alone publicly advocating.

Whether it's the melanin enhanced being shipped across oceans to pick cotton for Massa, the men of the country being impressed to die in the wars of their elders or the young being forced into servitude to the state by wiping said elders' bottoms there's a very simple reason why such things are repugnant. They're slavery. They are, in the end, the use of the power of the gun to force people to labour as you would wish rather than as they would wish, that they should spend some or all of their lives satisfying your desires rather than their own, something which has no place at all under even the farthest penumbra of a civilised society.

What is it with these people? At the moment it looks like the economy might return us to the living standards of 2006 and the truly pessimistic are suggesting 1990 or even 1980. So the suggestion is that we should regress in moral and legal terms to somewhere around 1800 to compensate? Seriously, what is going on?

Lost liberties

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“Our society is based on liberty and democracy. I do not want to see excessive surveillance hardwired into British society." So said Mr Richard Thomas the Information Commissioner for the UK in an article in The Times. His remit is to safeguard privacy and freedom of information, so he spoke out this past week by heavily criticising the fact that data the government has collected can be shared between departments and the private sector and that the communications database ‘risked turning everyone into a suspect’.

In an article on First Post, the author draws a line under the illusion that we have perhaps fallen back on over these past 12 years: that the UK is a bastion of liberty. Indeed, if we look at the past and the comments of Mr Thomas then it is clear we have done little to alter the progression New Labour has made towards a surveillance state. Thankfully though, some have remained stoic in the face of this anti-liberty agenda; Henry Porter is a fine example, and he along with many others has established the Convention on Modern Liberty that meets for the first time this weekend in London. Hopefully this will raise the profile of what we have lost and how we can regain it.

The excuse of terrorism has oft been used by those in power to extinguish our privacy, we should hold this up as short-sighted, short-termist idiocy of our elected tyrants MPs. Their own political survival is what we trade our freedoms for. If we value our freedoms highly then we should rid ourselves of the legislation and of the politicians. Until such a time the state will continue to see us all as being guilty and we can only prove our innocence by succumbing to their unquestioning will.

ISOS: Economic and Social Policy: What Next?

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Attracting Sixth form students from across the UK, on Tuesday the 24th February we held the first ISOS of 2009.

Starting the day with a speech about the dangers of the predominant constructivist ideology in European institutions, Westminster City Councilor JP Floru brought strong points against how its continuation could hold back Britain’s economy. Following JP was Douglas Carswell MP, who spoke on his plan to renew Britain in twelve months. He drew excellently upon his influential book co-authored with Dan Hannan on the same subject. 

After the first break, the ASI’s own Dr Eamonn Butler gave a speech on his excellent new book The Rotten State of Britain. Eamonn’s presentation considered how over the past decade New Labour has instituted by stealth a type of government more oppressive, arrogant, and authoritarian than what Margaret Thatcher was ever accused of. Following Eamonn, Kendra Okonski, Communications Director of the International Policy Network discussed with verve how a market-based approach is best suited for protecting the environment.

Jeremy Browne MP spoke superbly after lunch on the recent boom years and whether they were just an illusion. He argued that although the UK’s citizens are better off now than they were, this does not excuse the fact that much of the current financial crisis was caused largely by a government induced credit boom. Steve Rolles’ from Transform was up next tackling the controversial topic of drug reform. He argued convincingly that the legalization of recreational drugs and the medicalization of harder drugs would benefit the country through a lower rate of crime and tax receipts from their sales.

Dr Madsen Pirie spoke next on how to save Britain. The ideas presented were a synthesis of different necessary reforms to rebuild Britain after the recession; if only we had a government radical enough to institute them. Up last was Oxford Professor Martin Cox. He talked consummately on the bailout’s effects on the economy, considering who will pay for it in the end. Sadly the answer was of course the sixth form students listening. 

The Independent Seminar on the Open Society was once again a great success, with thought-provoking speakers and excellent questions from the students for which we are grateful. We would also like to thank Total Politics, Prospect and Standpoint who kindly provided magazines for the students.

 

Blog Review 884

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blog-review-884

We really do need to take a closer look at what is being taught in schools. Property is theft?

Obama's making sure that it sure ain't the neo-liberals making use of the "Shock Doctrine".

Governments involve social injustice. They sure do.

Are you ready for pessimism porn?

Back in the days when Paul Krugman was an economist.

What's Greek to you?

And finally, this is what stimulus means.

Royal Mail: the cost of failure

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In The Guardian yesterday, Lord Mandleson raised his head above the parapet and set out why the government needs to go ahead with a partial privatization of Royal Mail.

Mandleson is of course right that reform is needed. As he pointed out: “Royal Mail has a pension deficit larger than that of any FTSE 100 company. This deficit was last valued at £3.4bn, but the pension trustees warned this week that it will now be much larger, and even more unsustainable".

Given that this government was elected on a manifesto commitment to keep Royal Mail in public ownership, this compromise sails close to the wind of Labour breaking its promise. For this reason it is probably proper that they have not gone any further than this. Yet in truth it is a band-aid solution to a more fundamental problem, one in which the founding principles of the UK postal service need to be overhauled.

In the same piece, Lord Mandleson made the statement that: “Nobody would disagree that a universal postal service is more than just a business." Well I for one would. The standard argument against true liberalization of the postal service is that it would be costly for those in remote locations. There is some validity to this argument, but more importantly why shouldn’t people pay for the cost of the service they get? A postal service should never be a right that an individual burdens his fellow man with. Indeed, with the rise of competing technologies to post, such arguments will look increasingly anachronistic.

At present we have a socialistic model for our postal service. As such it costs much more than it could and should. Many of the costs are unseen in the price of a stamp, as governments have subsidized Royal Mail at the cost of billions of pounds to the taxpayer. One cannot expect any party to endorse this position, but as with all collectivist failures, history will prove this side of the argument right.

Recycling authoritarianism

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In a brilliant review of a number of recently published books on the politics of climate change, Steven F. Hayward considers the radical and apocalyptic concepts contained within them.

The arguments are similar to the ideas expressed by Vaclav Klaus: that many greens are disguised totalitarians. Of course, many leftist greens are recognizing that the present financial crisis could dismantle the policies that they want put into force. As such, to compete their visions are getting worse.

A large number of radical environmentalists are putting forward arguments for the eradication of the human species. This Malthusian panic scenario often spirals from the simple fact that human breathing has a carbon footprint. The argument follows that the earth would be better off if all humankind stopped breathing, and so we have such books as The World Without Us by Alan Weisman.

The greens are re-emerging as full-scale authoritarians. The good news is that these ideologues are running out of new ideas and are now recycling old ones, the problem is that these recycled ideas are the kind that many had hoped the US and Western Europe had put in their dustbins of history.

Brussels Dispatch: Through the looking glass

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If you don’t follow what is going on in Brussels, I envy you. The FT carries an astonishing interview this week with Joaquín Almunia, the Spanish European Commissioner for Monetary Affairs. Sadly, Mr. Almunia’s job title is the nearest we get to monetarism. Here is some dirigiste ‘almunition’ with my comments added:

“I’m convinced that financial regulation will be broader [more pervasive] and stronger [more punitive]. The financial system will be more regulated [more bloated parasites living off fewer wealth creators and more coercion in instructing entrepreneurs in what way they are to create wealth - which will then be confiscated by the State anyway].

This will mean less leverage [Mr. Almunia can perhaps take a look at the Member States’ track record of carrying debt larger than their assets, with their off-balance sheet accounting practices which would be illegal for any commercial enterprise, and redirect his cant in a  more needed direction], less flexibility in the financial system [I honestly have no idea what the man is talking about – unless he is ignorant enough to believe that less responsiveness in the financial markets is a good thing], and less influence for the financial system in the aggregated results of our economy [that’s right – he wants less wealth generation in the economy to come from investment]...

Either we accept that our growth will be lower than in the past because the stimulus [obviously, he’s been reading the New York Times too much, the word he really needed was ‘contribution’] from the financial sector will be smaller, or we find more engines of growth in the non-financial side of the economy. [Oh yes, look at all these engines of growth that we never knew existed just turning over happily in the Retezat hinterland. Good old Romania]. 

Never forget, you pay his salary.

Take a look around you, at what little liberty you still possess, O free market, because this is as good as it gets.

But there is one small sector I am still prepared to invest in – the lamppost industry.  Because when the revolution hits the streets we are going to need a lot of them.  Now a Commissioner for Lamppost and Rope Provision – that would fulfil a useful need…

Has Keynes trumped Adam Smith?

In this think piece, Mark Skousen considers Marxist, Keynesian and Smithian economics, and their comparative importance to contemporary academic and political culture.

The problem today is Keynesian-style policy, the darling of the establishment politicos and media giants:  big government solutions, deficit spending, easy money, bailouts. Keynes has suddenly trumped Adam Smith. And that’s dangerous.

One day last week, I walked into the largest Barnes & Noble bookstore in New York and saw a big display table up front with all kinds of books on John Maynard Keynes and Keynesian economics. One book, The Return of Depression Economics, was written by Paul Krugman, the caustic New York Times columnist who just won the Nobel Prize.

Another book was called The Case for Big Government by Jeff Madrick, the editor of Challenge magazine. I can understand writing a book in support of good, efficient, strong, and productive government, but “big” alone? Most Americans prefer the motto “cheaper and better.”

The biggest surprise at Barnes & Noble was to see my own book, The Big Three in Economics, prominently displayed along side all the Keynesian and Marxist books. It has suddenly become my most successful book.

But mine was the only book there that took a dim view of Keynes and Marx and their solutions to the financial crisis (always more government, more taxes, and more regulations). For my money, Adam Smith and his followers (Ludwig von Mises, Friedrich Hayek, Milton Friedman, Murray Rothbard) deserve to be on top of the Totem Pole of Economics.

Unfortunately, Keynes is all the rage now. The British economist became famous in the 1930s for advocating going off the gold standard, running deficits and bailing out troubled banks with easy money as a way to end the Great Depression.

Today’s politicians, from George Bush to Barack Obama, have suddenly become Keynesians during this financial crisis, spending money they don’t have in a vain effort to right the ship. Even Newsweek has gone so far to say, “We are all socialists now.”  Alan Greenspan, the ex-student of Ayn Rand, now favors nationalization of the big American banks Citibank and Bank of America.

Every investor and gold bug should know the enemy: Keynes, the advocate of big government and the welfare state, and Karl Marx, the radical who advocated outright state socialism and total central control of the means of production.

After World War I, Randolph Bourne observed, “War is the health of the state.” Today he might say, “A financial crisis is the health of the state.”

It looks like modern-day statists are getting their wish. We’re getting big government, good and hard. Adam Smith and Milton Friedman are out of favor, while John Maynard Keynes, the patron saint of bailouts, inflation, and the welfare state, is making a comeback with a vengeance.

The tentacles of the leviathan state are growing by leaps and bounds. In 2009, global governments will be the largest shareholders in commercial banks, reversing 20 years of retreat by the state. The costs of entitlements are exploding upwards, and Congress hasn’t had the courage to address future liabilities. Social Security and Medicare are government-sponsored Ponzi schemes that will make Bernie Madoff’s embezzlement look like a picnic.

The late management guru Peter Drucker said, “Government is better at creating problems than solving them.” In fact, wrote a cynical Ducker, government has gotten bigger, not stronger, and can only do three things well — taxation, inflation, and making war. According to Drucker, the state has become a “swollen monstrosity….Indeed, government is sick — and just at a time when we need a strong, healthy, and vigorous government.” (He said all this in 1969.) If you want to solve problems, he counseled, you must turn to business and the private sector.

But where does one get the straight scoop on Keynes, Marx, and their nemesis, Adam Smith and the followers of free-market capitalism?

I have no apologies for where I stand on the issue. In writing The Big Three, I commissioned a Florida woodcarver, James Sagui, to create “The Totem Pole of Economics.” (The Tolem Pole of Economics is shown on the back cover of the book.) Clearly, my hero is Adam Smith, the author of The Wealth of Nations, published in 1776, a declaration of economic independence.

Adam Smith, the 18th century philosopher, is on top of the Totem Pole for his advocacy of a revolutionary new doctrine which he called a “system of natural liberty,” what we might call laissez faire or free-market capitalism. He used the “invisible hand” to symbolized how the private actions of individual entrepreneurs would lead to the public good.

Today’s advocates of Smithian economics have real solutions to the crisis, as I’ve outlined in previous HUMAN EVENTS columns:  suspend “mark to market” accounting rules, make the Bush tax cuts permanent, slash the corporate tax rate, and mostly importantly “do no harm.” Also, it wouldn’t hurt to take a look at the Canadian banking system, ranked #1 in the world in soundness (US is #40) for its conservative reserve requirements and nationwide branching. (Not a single Canadian bank has failed in either the Great Depression or now.)

Keynes is ranked below Adam Smith, because he supported big government and the welfare state as a way to stabilize the crisis-prone capitalist economy, the “middle ground” between laissez faire and totalitarian socialism. But as we have seen, Keynesian activism has led to much mischief in the world today, and countries that have adopted his bureaucratic, regulated mindset have witnessed “slow growth” and “stagflation” style economies.

And Marx is the “low man” on the Totem Pole. His radical solution, government ownership and control of the production, distribution and consumption of goods and services, would be, as Hayek says, “the road to serfdom.”

Adam Smith and his “system of natural liberty” have come under attack many times by his arch enemies, the Marxists and Keynesians. But Smithian economics has nine lives, and has always managed a comeback. With your help, Adam Smith will return.

Click here for a copy of The Big Three in Economics.