Friday, January 23, 2015

Inequality Is Created and Enforced By ...

... government.  I can hear the apologists crying now, but so be it ...

Here's another column I wish I could have written, this one on income inequality, from Sheldon Richman entitled Two Kinds of Income Inequality[emphasis mine]

Income inequality is back in the news, propelled by an Oxfam International report and President Barack Obama’s State of the Union address. The question is whether government needs to do something about this — or whether government needs to undo many things.

Measuring income inequality is no simple thing, which is one source of disagreement between those who think inequality is a problem and those who think it isn’t. But it is possible to cut through the underbrush and make some points clear.

We can identify two kinds of economic inequality, and let’s keep this in mind as we contemplate what, if anything, government ought to do.

The first kind we might call market inequality. Individuals differ in many ways, including energy, ambition, and ingenuity. As a result, in a market-oriented economy some people will be better than others at satisfying consumers and will hence tend to make more money. The only way to prevent that is to interfere forcibly with the results of peaceful, positive-sum transactions in the marketplace. Since interference discourages the production of wealth, the equality fostered through violence will be an equality of impoverishment.

Is it better that people be equally poor or unequally affluent? This is the important question that political philosopher John Tomasi, author of Free Market Fairness, puts to his classes at Brown University. Would they prefer a society in which everyone has the same low income, or one in which incomes vary, perhaps widely, but the lowest incomes are higher than the equal income of the first society?

Which would you choose? Let’s remember that it is entirely possible for the poorest in a society to become richer even as the gap between the richest and poorest grows. Imagine an accordion-like elevator that is rising as a whole while being stretched out, putting the floor further from the ceiling. Would such a society be objectionable? Why is the relative position of the poorest more important than their absolute position? Is concern about relative positions nothing more than envy?

We could argue about that all day, but a much more urgent subject is political-economic inequality. This is the inequality fostered through the political system. Since government’s distinctive feature is its claimed authority to use force aggressively (as opposed to defensively), this second sort of inequality is produced by violence, which on its face should make it abhorrent.

Political-economic systems throughout the world, including ones typically thought to be market-oriented (or “capitalist”), such as in the United States, are in fact built on deeply rooted and long-established systems of privilege. Favors, which the rest of us must pay for one way or another, typically go to the well-connected, and prominent business executives have always been well represented in that group.

In the United States this has been true since the days of John Jacob Astor, the fur trader who had the ears of such influential politicians as James Madison, James Monroe, and John Quincy Adams. Government was little more than the executive committee of leading manufacturers, planters, and merchants (to risk opprobrium by paraphrasing Marx). As Adam Smith put it in The Wealth of Nations in 1776, “Whenever the legislature attempts to regulate the differences between masters and their workmen, its counsellors are always the masters.”

While business interests today are not the only ones that get consideration in the halls of power, it’s a mistake to think they do not retain major influence over government in economic and financial matters. “Regulatory capture” is a well-known phenomenon, and ostensible efforts to limit it always fail.

Unlike market inequality, political-economic inequality is unjust and should be eliminated.

How? By abolishing all direct and indirect subsidies; artificial scarcities, such as those created by so-called intellectual property; regulations, which inevitably burden smaller and yet-to-be-launched firms more than lawyered-up big businesses; eminent domain; and permit requirements, zoning, and occupational licensing, which all exclude competition. These interventions and more protect incumbent firms from conditions that would lower prices to consumers, create self-employment and worker-ownership opportunities, and improve bargaining conditions for wage labor.

Instead of symbolically tweaking the tax code to appear to be addressing inequality — the politicians’ charade — political-economic inequality should be ended by repealing all privileges right now.

Michael Shermer: Reason and Science Makes Us Moral

Absolutely true ...  remember: all sentient beings, and, sincere empathy!

No, Not "May Lose", They Will Most Definitely Lose!

New updates below original post!

[Original Post Date: 1/12/2015]
One thing is absolutely, positively certain with respect to Boston's bid for the Olympics in 2024: the taxpayer's will lose.  Period.  Now, they can certainly lose "less" if by fortune, their bid is not selected, i.e., they'll "only" lose the millions spent courting an extremely corrupt organization that truly has nothing to do with athletic competition.  If they are truly unfortunate and win the bid, they'll be out "... only $4.5 billion to host the games ..." not to mention the major inconveniences associated with the enhanced security and impact on traffic and mass transit.  Please, read my many posts available on this subject by scanning the material available via the labels below this post.  Here's Andrew Zimbalist's The Olympic Bid is Terrible News for Boston’s Pocketbooks.  Remember this as well: if hosting the Olympics is so valuable, then have it done with private money, and ensure that private money is not backed up in any way by any sort of government backstops.  So, if a consortium of investors want to bring the Olympics to Boston, fine, they do so by first, clearing it with the citizens of Boston and secondly, by assuming 100% of the risk.  Period.

On a similar note, this time from California: Inglewood Stadium Developers Expect $100M In Tax Reimbursements.  It's not surprise that "investors" get creative when searching for euphemisms for "confiscation" and "no public money".   Also no surprise are the politicians who, spotting an opportunity, condone the behavior and support the confiscation of their constituents' money.

And, on another similar note, this time from Missouri:  Missouri Offers to Hand Out $500 Million to Multibillion-Dollar NFL Team.  Voter stupidity knows no bounds:
With rumors swirling that one of its National Football League (NFL) teams might be relocating to Los Angeles, the Missouri state government announced plans Friday to finance a $900 million new stadium for the St. Louis Rams— $460 million to $535 million of which would come from public funding in the form of bonds or tax credits.

New:  Heathen Arizona Mayor Dares Besmirch All-Powerful NFL

New:  How Government-Funded Stadiums and Museums Harm Taxpayers

Do You Have "Oppositional Defiant Disorder” or ODD? Likely, Which Means ...

... you're mentally ill!  Seriously.  What is ODD you ask?  Here's the definition, as contained in It’s Official: If You Question Authority, You Are Mentally Ill:
As informs us, the definition of this new mental illness essentially amounts to declaring any non-conformity and questioning of authority as a form of insanity. According to the manual, ODD is defined as:
[…] an “ongoing pattern of disobedient, hostile and defiant behavior,” symptoms include questioning authority, negativity, defiance, argumentativeness, and being easily annoyed.

Labeling and then "treating" people as mentally ill was a tactic used by the Soviet Union to discredit and subsequently detain institutionalize dissidents.  

So, here we are, in the 21st century, and as the post points out, the number of disorders keeps growing every year, and now, if you "question authority", you're deemed to have a mental illness!

I recommend learning about the recently deceased Dr. Thomas Szasz who basically believed the overwhelming majority of the American Diagnostic and Statistical Manual of Mental Disorders (DSM) was bullshit.  Suffice it to say, he wasn't very popular in his profession, nor looked upon too kindly by Big Pharma.  You can check out the label on the good Doctor below this post. 

So, to conclude: if you challenge authority and simply do not believe the crap the government and its cronies routinely feed you, you're now certifiably mentally ill!  Only the behavior of sheeple will be accepted forthwith as 'normal'. 

Well, At Least America's Not First on This Index!

The World Misery Index: 108 Countries by Steve H. Hanke:

Every country aims to lower inflation, unemployment, and lending rates, while increasing gross domestic product (GDP) per capita. Through a simple sum of the former three rates, minus year-on-year per capita GDP growth, I constructed a misery index that comprehensively ranks 108 countries based on “misery.”

Below the jump are the index scores for 2014. Countries not included in the table did not report satisfactory data for 2014.

The five most miserable countries in the world at the end of 2014 are, in order: Venezuela, Argentina, Syria, Ukraine, and Iran. In 2014, Argentina and Ukraine moved into the top five, displacing Sudan and Sao Tome and Principe.

The five least miserable are Brunei, Switzerland, China, Taiwan, and Japan. The United States ranks 95th, which makes it the 14th least miserable nation of the 108 countries on the table.

Everything That's Wrong With America in One Chart

Talk about misplaced priorities:

Mercatus Center                       

Source:  Afghanistan, Iraq Direct War Spending To Date: $1.7 Trillion (and Counting)

Must Read: The Great Iran Debate And Bibi’s Neocon Obstructionists

Another excellent post from Justin Raimondo entitled The Great Iran Debate And Bibi’s Neocon Obstructionists

Europe's Quantitative Easing: The Beginning of the End ...

Draghi's QE Could Be What Pops the $100 TRILLION Bond Bubble.  I love simple posts, and this is it:
We are much closer to the end of the Central Bank-fueled $100 trillion bond bubble than ever before. This could be the beginning of the end.
In the words of wife: "Things were going well, until they weren't!"  If, as expected, Mario Draghi announces a QE program for Europe, an estimated 60billion Euros of bonds/month, it will be confirmation that the 1% are in full panic mode and will do anything to 1) preserve and enhance their wealth and 2) keep the masses at bay.  With Japan as the leading example that QE does not work, here's the European Central Banker calling for his drink from the same poisoned cup. 

This will not end well.  Hold fast.

Once again, timing is everything.  A few hours after the post above, Mario Draghi announced QE for the EU.  Here's David Stockman's take:  Mario Draghi: Charlatan Of The Apparatchiks 

Additional Readings:

Now Comes The Keynesian Chorus: Martin Wolff And The Monetary Cranks Lip Sync Draghi.  Here's all you need to know about why ECB QE is a bad move:
Bankers at the World Economic Forum in Davos are applauding the European Central Bank’s announcement of quantitative easing. Some said they were pleased the ECB’s plan, to buy about €60 billion a month in government bonds, is larger than expected. “It was positive and it was needed,” said Francisco Gonzalez, chairman of Spain’s BBVA. “Having said that, governments have to keep with reforms for the plan to meet its purpose,” he added.”

The ECB’s Dangerous Plight: Intellectually Bankrupt And Utterly Desperate 

Couldn't Agree More!

Top Counter-Terrorism Agency: Citizens Should Be Armed To Stop Terror Attacks:
“Ask yourself: If that was Denver, Col., if that was Texas, would those guys have been able to spend hours, days, shooting people randomly?” Noble said, referring to states with pro-gun traditions. “What I’m saying is it makes police around the world question their views on gun control. It makes citizens question their views on gun control. You have to ask yourself, ‘Is an armed citizenry more necessary now than it was in the past with an evolving threat of terrorism?‘ This is something that has to be discussed.”
Let me state for the record that I disagree with the use of the word "should" in the headline.  While I'm sure the author likewise did not mean that people who elect not to carry a weapon of some sort should be made to do so, there are many that would decry the use of the word on these very grounds. 

I have long advocated an armed citizenry.  I remind gun-control advocates that good intentions or nice sounding platitudes do not necessarily make good laws.  Simply because something sounds good, does not make it good.  Next, I ask these same advocates if they feel safe in the presence of policemen, and the answer is usually a resounding "yes" or "yes, of course!".  "Why?" I ask next, "Is it because they can arrest people or because they can defend you?  Again, the most proffered answer is defense, i.e., that person can physically protect you, and with a weapon if necessary.  "Your point?" I'm asked.  Simply this:  the feeling of safety in the presence of the police (current issues with police aside for the moment) should be enjoyed even when they're not present, which means, citizens must have the right to arm themselves.  I remind these people that in the overwhelming majority of dangerous situations encountered by citizens the world over, the police are not present, that is, you're on your own!  It's a dirty little secret that the police do not actually protect, they react after the crime, after the damage has been done.  The only people who have perpetual protection are either those who can pay for bodyguard, or, are in government, otherwise, you're on your own.  I find it ironic that politicians who are protected around the clock, can suggest so easily that those they purportedly represent, should not be able to avail themselves of the same protection.  Lastly, I close with this comment, which usually only works with those who live in large cities: are "cop bars" ever robbed?  Of course not!  Imagine a criminal walking into a bar that is the routine hangout of off-duty cops: how long would he live once he pulled out his weapon?  So, imagine what would go through a criminal's mind first if he could not rule out that any location he decides to terrorize would not contain a significant number of people who are armed. 

How American Politicians Think ...

HT: ZeroHedge

No It Cannot, However, Money Never Stopped The Warfare State Before

The U.S. Cannot Afford to be the World’s Police by James E. Miller:  [emphasis mine]
The recent shooting at the French satirical magazine Charlie Hebdo by Islamic extremists has reignited the debate on how to handle the threat of terrorism. The renewed talk is understandable.

As horror extraordinaire H.P. Lovecraft wrote, the “oldest and strongest emotion of mankind is fear, and the oldest and strongest kind of fear is fear of the unknown” It’s natural to be anxious about bodily harm, especially when the media amplifies the threat, whether legitimate or illegitimate.

While some lawmakers – mostly Republicans – propose measures to strengthen America’s security complex, the Pentagon recently announced the closure of 15 military bases in Europe. The plan is expected to save up to $500 million a year. The bases will be returned to the countries they inhabit. Outgoing Secretary of Defense Chuck Hagel assures there won’t be any job losses however.  [Semper Ratio: I somehow missed this good news! A small step, but an important one indeed!]

Republican critics argue the move is premature in the face of escalating terror threats and an emboldened Russia run by its power-hungry leader Vladimir Putin. At the same time, these detractors correctly point out that the U.S. must start tightening its belt. An $18 trillion debt is a national embarrassment.

The question for these conservative lawmakers is: If not now, when will fiscal responsibility actually be practiced?

The American military presence in Europe is a leftover of the Cold War and the threat of communism’s spread. Yet the Soviet Union collapsed two decades ago. Marxist ideology is now seen as a failure. Putin’s provocations aside, the West is no longer threatened with losing its way of life to the Communist Manifesto.

Europe may be crumbling under the weight of its own super-state economic controls, but it is far from facing another war to end all wars. The real threat to its stability is the lack of assimilation by immigrants from Northern Africa who are not fully vested in the liberal culture of the continent.

The rise of nationalistic parties like the UK Independence Party in Britain and National Front in France reflect a growing anger by working class voters. As Europe tries to reorient itself in a more globalized, more open world, United States military bases aren’t going to restore order within its borders.

Security hawks in the U.S. remain wary about base closures, fretting about elongated times to mobilize in case of an imminent threat to our allies. They presume American armed forces are needed for any conflict across the Atlantic. Any reduction in presence, these saber rattlers declare, is treasonous appeasement. Their specialty is calling any and all retreat “a Neville Chamberlain moment.”

All this fist-shaking about exiting the global stage amounts to a bunch of empty defamation.

America’s global presence isn’t waning. In recent years, President Barack Obama has announced plans for a military buildup in Asia to confront possible threats like a growing China. Drone strikes continue to pound the Middle East and Africa, with a recent strike killing an Al-Shabab leader in Somalia. Clearly, Washington’s imperial reach is not heeding the advice of the late senator and noninterventionist Robert Taft.

The conservative philosophy is supposed to be about reverence for tradition and a prudent outlook on human affairs. But modern conservatism is popularly defined by maintaining a large U.S. military presence across the planet. The position, which was injected in the mainstream thanks to Bill Buckley and his reputable magazine National Review, is in many ways incongruous with actual conservatism.

History proves a government can’t be fiscally responsible and the policeman of the world. All great empires were befallen by the inability of resources to keep up with ambition. From Alexander the Great to Rome to the great British Empire, hegemony doesn’t last forever. The U.S. government guarantees security to over 35 countries and has troops stationed in over 146 countries.

Does such an astounding presence – completely unmatched by previous empires – really sound all that sensible?

The countries with a notable U.S. military presence aren’t just protecting themselves under the banner of our mighty armed forces; they are slagging on their commitments to their own safety. As conservative commentator Pat Buchanan asks “Why do we tax ourselves to defend rich nations who refuse to defend themselves? Is the security of Europe more important to us than to Europe?”

If conservatism is truly about promoting individualism and fiscal responsibility, there is little sense in picking up the tab for nations that can and should meet their obligation for self-defense.

A safer world shouldn’t depend on the generosity of one superpower. Sovereignty and cooperation do better in keeping the peace rather than one country unilaterally patrolling every inch of Earth.

Shutting down a dozen bases in Europe won’t curtail the leviathan-like footprint the American government imprints on the world. But it’s certainly a step in the right direction.

The threat of Islamic terrorism remains very real in the West. It’s also not as cut-and-dry as Fox News makes it out to be. The kind of people who would pitilessly kill children to establish a caliphate are evil. That’s without question. But their motives are part driven by zealous ideology and part revenge for over a century of domination by Western powers.

Understanding that complexity, and that restraint often prevents the type of problems that aggression is supposed to solve, helps deepen a conservative mind. Immediate repulsion and rash action are the stuff of radicalism. Republicans should remember that next time they viscerally denounce the president’s latest foreign policy proposal.

Thursday, January 22, 2015

What, You're Surprised To Learn That ...

In the Last Fiscal Year, Washington Sent Special Operations Forces to About 70% of the World's Nations?  Just one question: really?  Well, truth be told, if asked, I would have estimated at least 90% of the countries "host" our "advisers":
How active is the U.S. military around the world? More than you probably think, Nick Turse reports at TomDispatch:
During the fiscal year that ended on September 30, 2014, U.S. Special Operations forces (SOF) deployed to 133 countries—roughly 70% of the nations on the planet—according to Lieutenant Colonel Robert Bockholt, a public affairs officer with U.S. Special Operations Command (SOCOM). This capped a three-year span in which the country's most elite forces were active in more than 150 different countries around the world, conducting missions ranging from kill/capture night raids to training exercises. And this year could be a record-breaker....[J]ust 66 days into fiscal 2015—America's most elite troops had already set foot in 105 nations, approximately 80% of 2014's total.

Despite its massive scale and scope, this secret global war across much of the planet is unknown to most Americans. Unlike the December debacle in Yemen, the vast majority of special ops missions remain completely in the shadows, hidden from external oversight or press scrutiny.
While these numbers have increased considerably over the last decade—it's more than double the figure for Bush's last year in office—133 isn't the all-time record. The year before last, the number of nations hosting American Special Ops forces was a hair higher, at 134.

[Via Mother Jones.]

Interest Rates: Will They Ever Go Up Again?

Frankly, I had difficulty with the title of this post.  Why? First, interest rates are a boring subject, usually ignored by most people, well, until they want to finance something (there used to be a time when people cared about interest rates because they wanted to save money, but that time's passed).  Secondly, the post I'm recommending is a long read, but so damn insightful, and in my case, required a second read.  Lastly, many people just don't care about interest rates, so how do I titled a post people will want to read?  Answer?  I can't.  Anyway, please read Thad Beversdorf's The Data Doesn’t Lie – See What’s Really Driving Interest Rates!  What I found most interesting is his continuing reference to what he calls the "Giant Con", which, if you're interested to learn more about, please click on the "Thad Beversdorf" label below.  The "Giant Con" is his term for what the government tells you is the condition/health/state of the United States economy: what "they" say and what the actual data says, are two diametrically opposed positions.  The government's is propaganda, while the actual condition is dire at best, terminal at worst.  Fundamentally, I just cannot accept the premise that ZIRP and NIRP are acceptable conditions!  To discourage savings and encourage borrowing is just so flawed and yet we're somehow told it's "the market".  My simple goal is this: education.  Please read.  I am not asking anyone to agree or disagree, rather, I just want people to gather perspective, and then formulate an opinion and position.  I care not whether your position agrees with mine or not, but I do care, and appreciate, you've taken the time to formulate an opinion based on something other than emotion and the tired, worn-out, left-right paradigm. 

A Great Question That Most People Likely Cannot Answer

What Is A Dollar? by Jeffrey P. Snider is a very informative, a truth be told, a scary read.  My response, when asked this question, has always been somewhat cynical, but nevertheless, true: "Whatever the government says it's worth!"  This is the nature of fiat currency, which is simply a currency that has no value backed up by a commodity such as gold.  This being said, each time I read about the dollar (or any currency), I continue to learn two things: 1) just how much I don't know and 2) just how fragile my assumptions and what passed for knowledge about the financial and banking sectors, really are.  If you're truly interested in what can happen to fiat money, read about hyperinflation in post-WWI Weimar Germany.  This picture gives you an idea of what a Deutschmark was "worth":