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.]

'When You Hear the Word “Collapse,” Ignore It,' says Gary North

This advice is so useful. I remember when Gary North first debunked the National Inflation Association on his subscriber-based website a few years ago.

It was a relief.

However, the NIA's fear mongering was useful in a sense because it produced real concerns--the fear of hyperinflation--that I had to address. I brought those concerns to someone who spent a good deal of his lifetime studying economics.

Part of the reason I joined North's Specific Answers site was because I was terrified of hyperinflation after seeing NIA "Hyperinflation Nation" movie and needed my concerns addressed. But after they were addressed and time passed, I publicly distanced myself from the NIA.

Most people who use the word "collapse" have the right intentions, but they're economics are misplaced.

North's recent article doesn't address the NIA but someone else.

From the Tea Party Economist Blog:

We hear the word “collapse” all the time. The word does not make sense in a free market economy. Collapses come all at once. Prices on a free market change, forcing people to adjust. We can get erosion. We can get recession. Short of a war scenario, such as biological pandemic, we cannot get a collapse.

I will cite an article that promotes collapse. I do not believe it for a minute. It is representative of what you should ignore.

When You Hear the Word “Collapse,” Ignore It. || Tea Party Economist

On the Brink of Inflationary Disaster - Robert P. Murphy - Mises Daily

On the Brink of Inflationary Disaster - Robert P. Murphy - Mises Daily

Lindsay Lohan on the Federal Reserve

Monday on Twitter:


Click here to re-tweet.

Free Download: Food Shock

Preparing for the worst is exactly what this 33-page book is about. The book is not shy to say so. On page four we read the following:

At some point in the very near future, home gardening may no longer be just a hobby; for millions of Americans, it could become a necessity.

Excerpts:

Darfur for the Simple, China for the Prepared

“Hunger today is not people starving in the streets, but it’s people choosing between food and rent. It’s parents going without food to feed their children. If safety net programs are further eviscerated, we are going to see Depression style hunger, Darfur style hunger, Calcutta style hunger happening here in New York.”

Estrangement from the land

“Never before in history have so many people been divorced from the production of their own food. Our estrangement from the land could prove to be our undoing … unless we take action now and reclaim that relationship.”

Plugging our ears when we hear "personal responsibility"

“Most people don’t want to hear about taking greater personal responsibility, or becoming more self-reliant. It’s no secret that many Americans, in general, have a sense of entitlement. A huge segment of the population expects that somehow, the government will come to the rescue.”

Hundreds, Thousands Earned on Food

A home garden can save at least $600 in food costs. Many gardeners save much more.

Housing Taking Away Farm Land

We lose, on average, one acre of U.S. farmland every minute. Most of this loss is due to the conversion of farms to industrial and residential uses. Between 2002 and 2007, 4,080,300 acres of farmland were converted for development. This is roughly the area of Massachusetts. This is just part of a long-term trend.

Prepare for the Worst; Download this Book

“In our just-in-time economy, we aren’t used to planning ahead. We think food will always be available, 24/7, whenever we need it. In most parts of the world, that’s simply not the case. Someday soon, that could be the case here in America as well.
Gardening isn’t hard, but it takes time … and timing.”

The book is available for download here and here.

If you don't want to go the Food Shock route (like me), or can't, then you can go the Alpha Strategy way. For those who just want to stock up, and learn how to do so effectively, download the Alpha Strategy here.

Robert Kiyosaki: We are facing either Depression Or Hyperinflation

I agree with almost every word.

Check out his books here.

The Flight into Real Values

I cannot stress how important it is that you understand this concept. It is something that is bound to happen in an increasingly inflationary environment.

According to the Mises Made Easier Glossary, The Flight into Real Values, or the Crack-Up Boom, is:

The frantic rush to spend all monetary savings and other available cash, buying goods, whether needed or not, in order to avoid holding, even for a short time, any rapidly depreciating monetary units. This occurs at that point in the development of inflation when the public is convinced that prices will continue to rise endlessly and at an accelerated pace. The flight into goods or real values is also known as a "Crack-up boom" (q.v.) and marks the complete breakdown of a monetary system.

It goes like this:

(1) People will begin to realize that the prices of all goods and services in the economy are rising.***

(2) People will realize that prices are continually going up.

(3) They will therefore buy now while prices are “low” rather than wait until prices go up again.

***Usually, economists mention that the reason the prices are going up and people are “unloading the currency” so quickly is because the purchasing power of the currency is weakening at a speedy rate.

Simple right? Let’s add some numbers to the mix.

Let’s say the price of peanut butter is $5 for a 1 lb on Monday. But on Tuesday the price increased to $7.50 which is a 50% increase from Monday. If this is the case, and if the consumer that wants peanut butter knows this will happen, what then is the rational thing to do? Buy Monday while the prices are low.

Without going into much detail, think about the micro-situation we as Americans are going through with gas.

Last Monday, prices were on average around $3.07 (roughly – I could be wrong. I am going by memory). This Monday, prices are on average $3.37 (again, roughly – I could be wrong. I am going by memory.) What is a person who wants gas to do?

Buy before the price goes up. (And for anyone who is wondering, the price of gas is expected to go up again)

To look at the problem in a slightly different way, let’s say the same thing happens in the automobile industry.

What if a new sports car is $50,000 one month, and then twelve months later it is $1,000,000? What then does it mean to be a millionaire? To extend the question, what then does it mean to be a millionaire if you can only buy one sports car with all of your money?

Not much.

So when will we see this kind of behavior?

The answer: during a hyperinflation.

During hyperinflation – defined as an increase in CPI at 50 percent per month – a scenario like the one above is the norm. Since I am more learned in economics than when I first started blogging in winter 2009, I no longer believe hyperinflation is a certainty, although I do still believe that high inflation is a mathematical certainty. (For those who wonder why, read Michael Pollaro’s recent article called “America, Poised for a Hyperinflation?")

So we have seen that the phenomena leading to the flight of real values not only hurts the poor, it also hurts the “rich” as well. The only way to avoid this flight—as much as you can—is to buy what you need early. And as I’ve mentioned before in other blog posts, some things you just can’t buy in advance. (Like a doctor’s visit or gas [at least in a state-approved storage unit])

For inflation to be reversed, the supply of money must be contracted (the Federal Reserve must raise the Federal Funds Rate). Unfortunately, this correction will cause a further depression which is why it is better the government doesn’t get in the business of inflating the money supply in the first place.

Also check out the videos I’ve posted on the site during the last two weeks. I’m sure there is something to pique your interest. (At least I hope so)

Timely reading
“The Mirage Of Inflation” Chapter 22, Economics in One Lesson by Henry Hazlitt

Gary North on our Impending Fiscal Disaster

I agree with this statement:

In this report, I am making a point: the country is headed for a fiscal disaster, and there is no broad-based political movement inside the country to put on the brakes. The train is headed for the collapsed trestle, and it is speeding up. The President as the engineer is talking about slowing the train a little, but he has not yet put on the brakes.

No one will put on the brakes.

Read the rest here.

Video: Poor Mans Way To Prepare For Hyperinflation, Homelessness as a Lifestyle...

Video: Surviving Without Money

What does a society that experienced hyperinflation and now is in its post-hyperinflation stages look like? Well, a lot like Argentina in the video below.

Watch and see how they survive.

Barter is one among other things. Seeing that they are still living and breathing and didn't kill each other off actually gives me hope among all the "societal collapse" prognosticators that the U.S. can bounce back, slowly and somehow.



In January 1988, a writer at The Freeman visited various South American countries and described the experience:

How would you like to live in an economy without memory, where you don’t know the price of anything day to day or the value of the wage you are paid? That’s what it’s like under hyperinflation, in Argentina, supermarket prices are increased twice daily. During the two weeks we were in Brazil recently, interest rates rose 100% from 330% to 430%. Bolivia’s demand for money is so great that its third largest import is currency.

Read the rest here.

Collegian Writings

So, I am also a writer for The Collegian, La Salle University's student-run newspaper. Please check out my published articles online (you may have to type 'Goins' into the search bar). So far, they've only posted 6 articles, but I've written more than that. I plan to expound on some of the ideas presented in the articles later in this blog.

1. La Salle's Lessons and Laissez-Faire
2. Shroud of Turin Mystifies but provides no certainty
3. Hyperinflation an Under-Reported Story
4. Walter Williams a notable city native
5. Miller Shows Faults on both sides
6. Aching for the truth on health reform

I also encourage you to read the other columnists in the Commentary section and beyond.

A Note on the National Inflation Association

Update 4/25/11: I no longer use the National Inflation Association as a source (Gary North refuted an article of theirs on his website).

Update 5/23/11: Peter Schiff has given me more reasons not to listen to advice of the National Inflation Association. Read my post "The National Inflation Association Scam"

Update 1/9/2012: NIA is a scam - Do Not Promote Their Videos

Investing in Preparation for a Hyperinflationary Environment

Some general rules of thumb:

[1] The U.S. Stock Market is not a good place to start. If you have never invested before, opening a brokerage account may cost you more than it will help you. For example, opening an account with Fidelity will cost you around $2,500. Do you have $2,500 to spare? Do you have enough to buy $7 per share? How many shares would you buy? Will you have money left over to pay for bills and food? Did you know some of the minimum deposits for some accounts begin at $10,000 and the cheapest being $500? Can you afford that? These are some of the questions you should ask yourself before diving into the stock market.

P.S. The only stocks that look as if they will do good are Gold Stocks, Silver Mining Stocks, and Oil and Natural Gas. Some of these stocks are really low (beginning at $1.69 per share; $6.95; $12.95, etc, these are general prices for demonstrative purposes only) Others are already as high as $2,000 per share (these are mainly the oil stocks)

[2] Gold is more valuable than silver, period. Gold ended today at $1,042.26. Silver ended at $17.38. Get my point.

[3] Gold is rarer than silver. Silver is used for industrial purposes because it is more common. Nobody uses Gold for industry.

[4] Gold is an inflation hedge. More people are buying gold than ever before to protect their money. (I was recently told that gold is better used for the recovery period i.e. post-depression. I will rebut that with more facts later.)

[5] Stay liquid. "Liquidity" basically means keeping money in your pocket to spend. It also means keeping money in your pocket to save.

[6] Here is a recent article on Gold. Check it out.
http://www.lewrockwell.com/casey/casey31.1.html

[7] Some gold companies require you to make a minimum purchase of $10,000. Sound familiar? Perhaps you are better buying a year's worth of dry food to eat in the case of food inflation. (Especially if you live in an urban area.)

[8] Here is another website giving basic information on the history of gold, investment tips, and more. I highly recommend it.



....More to come later.....