I caught myself being contradictory

I caught myself being contradictory, so I deleted the following sentence out of a blog-in-process:

But being pro-peace means being anti-violence; and that includes violence from the state against individuals. You can't have a fully-orbed pro-peace philosophy if you are pro-violence somewhere down the line in your thinking.

This means I can never be fully libertarian in the Rothbardian sense of the word.

The truth is that I do believe in government force, but only where it is legitimate.

As one high-level person in the Libertarian Party once told me, under the Libertarian Party, 90 percent of government would shrink at all levels.

That's pretty much what biblical law would do as well.

Video: The Truth About Bernie Sanders

Get a free E-book on Bernie Sanders here.

[Editor's Note: Regular readers of this blog should this is part of the"Why You Should Not Vote For Bernie Sanders" series. 

The reason I am doing this is because a number of my (young) friends are falling for the rhetoric and promise of Democratic Socialism. It (often rightly) rails against big business.  It (almost) never rails against the government framework which made big business possible. 

It is embodied in the persons of Elizabeth Warren and Bernie Sanders. Unfortunately, they're both wrong.

My posts will be informed by the Thomas Woods' new E-book Bernie Sanders is Wrong, other informed economic articles, and my personal reflection, except in cases where I find good videos, as was the case with the second post above.

This is Part 2 of many…and I mean many.]

On Free Water, Free Tuition, Free Healthcare, Bernie Sanders, and Rand Paul

Get a free E-book on Bernie Sanders here.

I was at an event last night and a speaker said something to the effect of "Only in America" -- or let's say under capitalism -- do they make you pay for something free like water, as she sipped her bottled water... 

… bottled water that has been contained with machinery, filtered, and bottled -- among a host of other things -- by human beings.

…bottled water that was at one time in a river, or lake, or mountain, or spring, or wherever they get water from (the beauty of the division of labor in free-market capitalism is that I don't have to know that stuff).

In part, she wanted specialized knowledge to be free.

Deer Park employees, among the many other water companies' employees, are people who wake up every day provide a vital product to the billions of people who chose not to be in the water business. Numbers of trucks which run on un-free gasoline deliver this vital source for life every single day to the market place.

Gone are the days of carrying a pail of water to the river, scooping up as much water as you can, and carrying it back to the hut village. Gone are the days of getting water from the well.

The water companies have gotten so good at this that they provide water in different sizes -- from little bottles that can fit in your palm, to bigger bottles that be put on water coolers; these bottles come in size swig, saturate, and submerge. Gone are the days of size pail and bucket.

They have gotten so good at it that water comes with flavor.

And yet they want this to be free.

Fine, I'll grant you, but only for the sake of the argument, that water is free. What I won't grant you is that the labor should be free. Further, I know that you won't either.

Much of that was my immediate thought but I didn't say anything. It wasn't the right forum. It would have taken the event over the allotted time. The only thing I thought in addition to that is that working for free involuntarily is what we used to call slavery. 

But I know what they mean: Whether it is free school or free water, advocates will say workers will get paid through taxes. But that only pushes the involuntary labor to the taxpayers.

Why should I involuntarily use my labor to pay for someone else's stuff?

That is an ethical problem for Democratic Socialists.

But I want to put another thorn in the side of Democratic Socialists.

Going back to the subject of water companies, why should someone like Coca-Cola, the Dasani water owners, be mandated by the government to operate a large part of their company for F-R-E-E.

Am I shifting definitions? Don't I know that Democratic Socialists would, through taxpayer dollars, pay a company to operate their water business.

Oh, so you want to get into subsidizing big businesses and corporations. Gee, I thought that was what you were protesting in the first place.

But let's take it one step further. Why should we think of only existing businesses as free providers of this vital product? Why not apply our thinking to future entrepreneurs? The little guy. Should the little guy provide this service F-R-E-E?

Should we subsidize the little guys future water business? Should he not operate by profit-and-loss to judge the success of his business?

Rand Paul had a similar experience.

He was asked a question about Bernie Sanders' solution to Social Security.

I like Rand Paul's answer. He admits up front that you are not going to like his solution. Furthermore, he gives the alternative: He can pretend like everything is okay and promise you everything you want and destroy the country in the process.

By destroying the country, he probably means destroying our dollar through hyperinflation. The Federal Reserve would have to create so much money that our dollar would become worthless.

Democratic socialists, like Bernie Sanders, would solidify our economic doom.

[Editor's Note: Regular readers of this blog should know that I was coming up with a "Why You Should Not Vote For Bernie Sanders" series. 

The reason I am doing this is because a number of my (young) friends are falling for the rhetoric and promise of Democratic Socialism. It (often rightly) rails against big business.  It (almost) never rails against the government framework which made big business possible. 

It is embodied in the persons of Elizabeth Warren and Bernie Sanders. Unfortunately, they're both wrong.

My posts will be informed by the Thomas Woods' new E-book Bernie Sanders is Wrong, other informed economic articles, and my personal reflection, as was the case with the first post above.

This is Part 1 of many…and I mean many.]

Put the economic crisis in perspective

Put the economic crisis in perspective:

The government has been using stimulus to thwart a recession since I was 13.

I'm 27 now. They've been pushing off a recession for over half of my lifetime.

They've been using stimulus since 2001 and what do have they to show for it?

If stimulus worked so well, then why are there 2 million breadwinner jobs -- $50k a year -- less than 2000? Why are wages still declining?

By pushing off the recession with stimulus, they make the inevitable correction even worse.

What if we had one bad recession in 2001 and then that was it? What if we all had to toughen it out for one bad year when the economy was much stronger?

What happens now that the crisis is still forthcoming and people don't have the incomes and savings to brace for it?

Imagine if all of the people who went to college from 2001 to 2015 -- including myself -- had to make decisions to go to school based upon real price sensitivity, based upon what they could actually afford, versus enrolling in federal student loan programs? How financial freer would those people be?

The solution is to drastically cut spending, preferably Ron Paul 2012 presidential platform style by $1 trillion, end local, state, and federal bureaucracies, drastically lower taxes (no regressive flat tax, conservatives), and end the American Empire overseas and at home. Oh, and of course, End the Fed.

There's also other things that could be done but that's for another blog post. But for starters, we could legalize capitalism.

Big businesses are "fine" with Minimum wage; Mom and Pops struggle with compliance in Seattle

“The business owners are delaying new construction, suffering losses, and raising prices to comply with Seattle’s new $15 minimum wage.” ~The Bastiat Institute

Main Points

• Higher prices are the symptoms of a much bigger problem: the expansion of the money supply by the U.S. central bank, the Federal Reserve, and the subsequent lower purchasing power of the U.S. dollar.
• The states are laboratories of democracy.
• Mainly the Democratic Party, and a few Republicans support the minimum wage. In fact, raising the minimum wage was on the Democratic Party's 2012 Platform.
• This is a traditionally “progressive” policy.
• Corporations like McDonalds and Walmart have already admitted they can cope with this policy.
• Smaller businesses however will have a much harder time coping with this, such as those in Seattle, Washington where a $15 minimum wage has been implemented and took effect this week. 

Summary

Republicans claim the minimum wage hurts businesses.

But McDonald's CEO supports the minimum wage. Why?

Because it will squeeze out the competition. The truth about the minimum wage is that it won't hurt the biggest businesses as much as it will hurt their smaller Mom-and-Pop size competitors.

In other words, "progressive" support for the minimum wage harms the "weak and the vulnerable" and benefits big corporations -- the very opposite of what they intend.

Cities, counties and states are “laboratories of democracy.” We are supposed to see what doesn’t work in this city and that city and learn from them – not turn around and advocate the same thing nationwide.

Higher costs of living are due to inflation and a declining currency. Declining currency comes from the expansion of the money supply (inflation).  Inflation comes from the Federal Reserve.

If you need any proof of the decline of the U.S. dollar, then play around with this inflation calculator from the Bureau of Labor Statistics and see how much a dollar was worth in 1914 versus what it is now.

As an example, $100 in 1913 is $2,394.67 in 2014 money. But the opposite is true: $2,394.67 in 2014 is $100 in 1913 money. In other words, it takes a lot more of today's cash to match the purchasing power of our American ancestors.

In short, higher prices are the symptoms. The Federal Reserve’s monetary policies are the cause. We should not be going after symptoms with legislative medicine because they, like real corporate medicine, have all different kinds of harmful side effects, namely, unemployment, higher prices, and a delay in business expansion by entrepreneurs.

The people who will see this and support this idea anyway will stop us and say “no, we just wanted to slowly increase the minimum wage just a few cents or dollars more each year.” But all that really does is price out the jobs below that price floor incrementally, and delays the inevitable.

The fact that the law provides an exception to businesses with under 500 employees proves my point.

According to a CNNmoney article:

"One point of controversy prompted the International Franchise Association to threaten to sue the city within hours of the bill's passage.

Under the law, businesses with fewer than 500 workers are given more time to comply. That would be fine with the franchisees, if they were considered one of those smaller businesses.

Instead, the law states that a business owner has to count all employees in the U.S., likely putting those affiliated with a national franchisor in the large-business category."

How in the world do the people who passed this law know what time individual business owners will be able to afford the minimum wage increase?

Companies such as Walmart and McDonald’s say that they are fine with the increase. That’s because they have the structure in place to do so unlike small mom and pop shops.


Watch the wonderful explanation of this point here.

So yes, year over year legislators will have worked to bump up the minimum wage and to price out jobs below $0.50, $1.40, $4.50, $6.25, $7.25, $10.25, and $15.00.

Those kinds of jobs aren’t meant for anyone to “live” on. They’re usually reserved for teens, children, and low-skilled adults. At that age, they’re not getting paid in money alone but also in skill, responsibility and reputation.  Kids and teens could use jobs in the summertime and all year round.

Adults, on the other hand, need higher wage jobs to take care of themselves and their children. But the jobs and wages they desire are being squandered on a massive federal debt and are confiscated through taxes.

Let it be known that this is a policy that has the Democratic Party’s, including President Obama himself, and even a few Republicans’, hands on it and they should be held accountable.

Review - Lessons for the Young Economist - Lesson 9

Entreprenuers are considered to be the "driving force" of the market economy because they see things that others do not and then use their resources to offer goods and services to fill in that gap. As someone who wants to be an entrepreneur, I see that there is an opportunity, a gap, in the education system in my county. In turn, I can offer my tutoring services (my product) to potential customers (consumers), which are students and parents.

In the real world, all capitalists are entrepreneurs.  This is because capitalists, or people who control financial wealth, and often large amounts of financial wealth, put their money to use to produce goods and services that consumers will benefit from using. The classic example of Bill Gates or Warren Buffett will serve us here. They both had to acquire their wealth offering consumers things that they wanted. Also, capitalists serve their fellow entrepreneurs by offering them goods and services that will make their business run smoothly.

Xerox sells machines that make corporate office life easier. The huge machines that you see on the television shows Ax Men and American Loggers aren't -- to my knowledge -- made by those companies that chop down and move trees. But the entrepreneur that made them also had to have a large amount of money (savings, borrowed capital) to produce their machinery.

Competition regulates and motivates entrepreneurs to be honest, to offer quality products at the lowest price. When a competitor enters the market  -- let us take our Xerox example -- and begins to offer $800 copy machines that does exactly what the $1,000 Xerox machine does and more, Xerox will have to figure out how to offer a better product at a reasonable price. Otherwise, Xerox will find itself bleeding revenue, which will be going to the new market participant that's selling the $800 copy machines. This accounts for the regulation side because the product costs are regulated.

The competitive process unfolds through "imitation and innovation," as the book puts it, through various ways. Let's say I am the owner of a Chop't salad restaurant that's located next to an Olive Garden. We both sell similar products, namely salads. The reason I set up shop was because I thought I could offer better tasting salads at a faster rate and a better price. And to my credit, my vision paid off. I begin to attract customers to my shop. Olive Garden in return sets up a "to go" service in response to our competition to give customers great tasting salads "on the go." This back and forth keeps going and in the process the customer is ultimately the one who benefits.

Because of the competition between the two salad sellers, customers are getting healthy greens at a much faster pace than they were before and at a lower cost (both in terms of dollar value and time "time is money").

In short, as the Teacher's Manual puts it, "no entrepreneur starts from scratch.  He or shoe first sees what others are doing, and then tries to make improvements in order to attract customers from others."

But there is another beneficiary of all of this: the worker. Workers who apply for jobs in this competitive market will find that one employer offers a wage for one job, and the other employer offers a wage for the other job. Workers have the choice between what kind of work that they want to do and at what price.

If a worker finds that Chop't is offering a job at $10/an hour and Olive Garden is offering work at $8 dollars an hour for similar work, that worker will probably choose the higher paying job.  What can't happen though is Chop't paying $10/an hour and Olive Garden paying their workers $4/an hour. Olive Garden workers will tend to care that they are getting, subjectively speaking, "underpaid" for such work and have the option of leaving for higher paying work -- which will benefit Chop't.

Again, as the Teacher's Manual puts it, "if a particular worker is being paid less than his or her marginal product, there is an opportunity for a competing entrepreneur to offer a higher wage and pocket the (smaller) gap.


This is an ongoing review of books. Look for reviews of chapters or entire books in various topics ranging from theology, English literature, philosophy, monetary policy, black history, economics, political history, American history, philosophy of religion, self-improvement, and poetry. Basically, I'll cover whatever I feel like reviewing at the time.

Like after Fukushima, after 2014 snowstorms financial "experts" are blaming the weather for bad economy

There has been an increasing trend among financial "experts," TV talking heads, and economists to blame the weather on our crappy economy.

I first began to notice this trend in 2011 after the Fukushima Daiichi nuclear disaster when then Federal Reserve Chairman Ben Bernanke, testifying before Congress, attributed part of our slow growth to that earthquake caused event.

But now this explanation is back in full force, and we are supposed to believe that snow is the reason for the bleeding (Reason for the season? Christmas? Snow? Get it lol).

And we are supposed to believe this in spite of the fact that where the weather was arguably the worst, the chilly Northeast, house sales performed the best in the country. The NE saw a 12.5% increase in February, which was awful weather wise, to March. Meanwhile, the mid-West (-21.5%), the south (-14.4%), and the west (-16.7%), all received negative growth.

According to their line of reasoning, the rest of the states are need in some snow right now; and the ones that did get snow, they need more.

Vladimir Putin learns the wrong lesson from the Soviet Union's collapse

As I was watching the opening ceremony for the 2014 Winter Olympics in Sochi, a commentator said that Vladimir Putin thought the collapse and break-up of the Soviet Union was devastating, or something to that effect, and that Russia lost a lot of "good Russians." 

Bizarreness of that statement put aside, it deflects from real analysis of the Soviet Union's collapse in 1991.

What we should make of the Soviet Union's collapse was that we saw the complete and utter collapse of a nation based on an idea: Socialism. 

The "former glory of the Soviet Union" was no glory at all because socialism -- no matter how many years and decades it will take -- always plants the seeds for economic destruction. So going back to it would be like a "dog going back to its vomit" (Proverbs 26:11), and fool repeating his folly.

One other point here.

We are not unlike the Soviet Union.

As Thomas Woods explained in his 2009 book "Meltdown": "[the U.S. Federal Reserve System] is dedicated to central economic planning, the great discredited idea of the twentieth century. Except instead of planning the production of steel and concrete, as in the Old Soviet Union, it plans money and interest rates, with consequences that necessarily reverberate throughout the economy."

We are in the midst of a grand experiment that will end in nothing less than devastation for a lot of people. As I explained in previous statuses**, the time for a "soft landing" was over a decade ago. We should end our foolishness now to avoid an even harder landing later.

**Originally written as a Facebook status

The Books I Used To Write the Second-Longest Paper I Ever Wrote

When I was a senior in college, I wrote the second-longest essay of my life -- and it wasn't for a class. It was for a cash prize of $5,000.

In December 2009, I heard about the Atlas Sound Money Project Essay and, broke as the economy, I jumped for the cash prize. I did not win the first prize. A kid from Dartmouth did, if my memory serves me correctly. I also did not win the one of the two second prizes ($1,000), or one of the three third prizes ($500).

I had to choose between the following topics:

Essay Topics:

- “Money and the Free Society: Can Money Exist Outside of the State?”
- “The Ethical Implications of Monetary Manipulation”
- “Monetary Policy and the Rule of Law in the United States”

I choose the last one.

But cleaning up my desk this evening (how it surfaced to my desk 4 years later, I have no idea), I decided to discard the paper I had notes on and preserve the memory through this blog post.

Here are the books I used to write the 20-page essay, which was supposed to be "accessible to the educated laymen, but rigorous enough as to be used in college and university courses." That had my writing style written all over it.

Economics Reading List for Sound Money Essay 

-The Alpha Strategy

-How the Fed Works (50 pages)

-Essentials of Economics

-Gold Wars

-Honest Money (Esp. Biblical Monetary System)

-Housing Boom and Bust

These aren't the only sources I used. I also completed Robert P. Murphy's "Politically Incorrect Guide to Capitalism," some excerpts from some newsletters I was receiving at the time, and more. Besides the Murphy book, only other books I read in their entirety for this essay was "The Alpha Strategy" (which I have offered free of charge since November 2009), "Gold Wars," "Honest Money." I skimmed through the Sowell Book. I probably didn't cite the Faustino Ballve book nor the How the Fed Works book.

I also have some handwritten notes on this paper, such as "banks are good - fractional reserve isn't," "sell back gold to the public," "FDIC out of commission," "FED = Insurance Agency," "prevent recessions," "prices of goods will fall," "gov = tax in gold," " = pay in gold," and "no government mandate for gold-only. Gold is standard, but other metals are usuable (sic)." Corresponding page numbers were in parentheses next to these notes.

The Atlas Foundation's original blog post announcing the competition was published on December 2, 2009. The deadline to submit the essay was January 15, 2010.  You can read the blog description here.

I'll publish the essay on a later date.