Random Thoughts for an Upside Down World
October 06, 2010
– Comments (33)
Let's look at some arguments often trotted out in the public arena. This is a stream-of-consciousness blog, open for discussion, not a rigorous analysis. I hope you find it interesting, if not the usual standard.
Gold is overpriced.
The Federal Reserve needs to avoid deflation.
These two arguments are rarely made in the same breath, but they are made by the same people. If you've been around here a while, you know who those people are. In case you are wondering where they've gone, just about every CAPS gold basher of the last two years has fallen off the radar or lowered themselves to snarky duck-and-run comments.
Just spend a moment to think about these two statements. Do you see the contradiction? If you believe the Federal Reserve must avoid deflation, then you also have to predict further currency devaluation.... and... .wait for it.... higher gold prices. So how can you advocate a policy on the one hand that will increase gold prices, namely inflation, while telling everyone who will listen that only a fool thinks gold is underpriced?
Oh, sure, some of them get crafty (or just extra stupid depending on how you look at it), and they assure us that the Federal Reserve can withdraw the funds they've created, keeping the dollar stable (whatever that means to them). In the end, they're just sure that gold buffoons will be squashed like bugs. The glorious, supreme, and noble unelected technocrats of the Fed will triumph over selfish individual liberty and the evil capitalist market.
Yeah, sure.
Just keep in mind that back when the Credit Hoax, uh, I mean Crunch was happening, these jokers called for dollar devaluation. Now they can't understand why gold prices are so high. Are we sure they don't need medication?
Freedom Isn't Free
Welfare Spending Is Bankrupting America
This one's a little nuanced. Democrats, or just left-leaning people in general, let me help you. The next time a limited government, pro-war Republican tells you that the government cannot be trusted to manage healthcare, here is your response:
"If the government cannot be trusted to manage healthcare, why can it be trusted to fight prudent wars overseas? Why can it be trusted with the power to wiretap American citizens? Why can government agents be trusted to write their own search warrants under the Patriot Act? Why can it be trusted with nuclear weapons if you can't trust it with hospital services? Why can it be trusted to have secret prisons, renditions, and authorized assassinations of American citizens? Etc."
It's a slippery slope, as you can see. The pro-war Republican may respond that the excesses of war are necessary because in today's world there are so many threats to our safety. But who is to blame for today's unsafe world? Governments! The Tom Tancredo supporter will scare you with tales of nuclear footballs and dirty bombs, but who gave us a world with nuclear footballs and dirty bombs? People like Tom Tancredo! Helloooooo!
The pro-war Republicans are even worse on economics. I'd like to point out to my Republican friends that the market supports universal health care. Oh sure, I don't mean government enforced and mandated health care. But before there was such nonsense, the market provided health care, clothing, and food for every American through something called charity - the original universal health care. It's obvious that Americans, like most humans, don't want to see their fellow countrymen starving and sick in the street, even though they may have differences over how the problem arises and determining the best solution. (Hint: voluntary is always the best solution.) But where is the market desire for war? Where are the Americans voluntarily paying to take down every bad dictator and evil-doer the planet has to offer? Simple, there is no voluntary market for war.
Pro-war Republicans spun fairy tales (and many still do) about how war would pay for itself, appearantly forgetting their own caution about what happens when you give money to government. Sure, Iraq and Afghanistan have natural resources that can be used to recoup the monetary expenses. But let's not forget that the same Republicans telling you that government cannot manage health care are also trusting the government to extract trillions of $$$ in natural resources from a third world country!
(And let's just skip the moral issue of invading a country to steal its resources for profit.)
In Today's Global Economy...
This isn't a contradictory argument, it's just a stupid phrase that annoys me. When I come across this phrase, I know the author is an idiot. It really doesn't matter what comes next. Generally, however, what comes next is some philosophical waxing about how things are so different today because of blah blah blah, so of course what is required is more government economic cooperation and blah blah blah, and on and on.
Nonsense. The minute Magellan went around the world it was a global economy. (The Bedouins just honked their camel-towed Mercedes Benz's at me to protest. We always forget about the Bedouins.)
The only difference today is one of efficiency. One hundred years ago, it was a global economy. Four hundered years ago, it was a global economy. Why do you think there are Indians living in Cape Town and Durban, South Africa going back to the 1600's? Try telling them it wasn't a global economy when they set sail on the Indian Ocean. Try telling a man on the NYSE in 1910 that he didn't live in a global economy and he'd laugh you out of the room. People have always wanted to trade with as many other people as possible. Global trade has existed for as long as people could trade around the globe. It doesn't take any special magic sauce sprinkled by governments and their cabal of bankster gangsters and unelected bureaucrats.
Like the freaking global economy needs a child such as Timmy Geithner to help it prosper. Jebus, what is wrong with people?
Can anyone explain to me why the SEC exists?
I can't wrap my head around this, so you'll have to help. I guess the argument is that I need to protected from something, but what? I'm an investor. That means I have money. Why do I need to be protected? If I really cared about the safety of my investments, why wouldn't I just take some of that money off the table and hire someone who specializes in protecting investors? If you're poor, you play the Lottery. You don't buy 100 shares of some crappy shipping company. So who exactly is the SEC protecting?
Investors have money, otherwise they wouldn't be investing! They can buy their own protection, otherwise they wouldn't be investing! Get it???? They don't need a nanny government agency, paid for by investors and non-investors, telling them what is safe or not safe. And if they don't get that protection, who cares? Are liberals really going to tell me I'm supposed to feel sorry for rich people that are too cheap to pay for investment protection? Oh, c'mon.
In 1914 at the outbreak of WWI, there was no SEC. Panic struck Wall Street and the entire investment community was bankrupted. People hurled themselves onto the pavement after losing every dime. Companies went bankrupt. The entire American economy ground to a halt.
I just made all that up.
What actually happened? Oder. No panic. No chaos. Order arose. Private institutions protected the shareholders, lenders and creditors. The market barely hiccuped.
For a detailed examination of the NYSE's response to WWI, see Benjamin Anderson's 'Economics and the Public Welfare.' It's also a fantastic book.
So tell me again, why do we need the SEC?
One hundred years later and the track record of the SEC is one train wreck after another, one shortsighted and foolish intervention after another, one missed fraud after another. Yet they keep getting paid (it's gotta be trillions wasted by now) and they keep expanding their reach.
Must be human nature
In 1974, Stanley Milgram published Obedience to Authority. It was the results of an experiment that tested a person's willingness to go along with Authoritarian wishes even if it meant inflicting visible pain on another human, regardless of the reasons given. The results were shocking and disturbing. 99% of humans will inflict increasing amounts of visible pain on other humans simply at the suggestion of Authority. 99%!!!
The experiment works like this: two volunteers are selected. One is a "teacher" and the other a "learner." With each wrong response, the "learner" receives an increasingly more painful electric shock. If the "teacher" begins to balk at adminstering the shock, the experiment director (the Authority) instructs the "teacher" to continue no matter what.
Despite the screams of the "learners" and voltage levels reaching dangerous levels, 99% of "teachers" continued to adminster the pain rather than stopping the experiment and walking out. This experiment has been repeated many times and the results are always the same. Only about 1% of the population stops the experiment once pain is visible.
Note: the "learners" are always paid actors and are never actually harmed.
This is a very sobering experiment.
What does this say about the concept of Authority in general? Can Authority ever be trusted? Can a person acting on the behalf of Authority ever be trusted to act morally?
I think humans have a natural desire to shuck responsibility for their actions. I think this experiment "works" because humans would rather have someone make decisions for them (it's not my fault. He told me to keep adminstering shocks.)
But how can one have any hope in a benign and moral Authority when it is human nature to accept orders given by Authority even when we see the horrible impact those orders create?
Surprise! I'm an Anarchist
So that's just something to think about. And yes, in case you were wondering, I am an anarchist. It's too late now. You already told me you liked me. No takesies-backsies.
David in Qatar
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