A good example of how legislation tends to promote the very activity it is trying t restrict. Here is the key quote:
The laws are harsh, Doyle agrees, but it does not stop the artists, who appear in greater numbers every day to make their mark on the city. “This kind of art has to have an illegal element to it,” he said before flashing a toothy grin. “In the end, you’ve got to have your street cred, you know?”
From KeepYourAssets.net:
We live in a marvelous yet dangerous time. Marvelous because the miracle of technology allows the instantaneous flow of information and ideas. Dangerous because existing power structures often use violence to maintain their power and control information. We’ve seen evidence of this already with past and present legislation that further legalizes the murder, theft and kidnapping of innocent people.
I can’t help but think of where I’ll be a few years from now. Will I be in a jail cell as a political prisoner because I dared to write these words? Or will I be rejoicing with my fellow human beings who have welcomed and implemented the ideas of freedom? Will I still be writing these ideas of liberty or will jack-booted thugs have kicked down my door in the early hours one morning, shot my pet, terrorized my family, and shipped me off to Guantanamo for “indefinite detention” and torture?
Percy L. Greaves, Jr., an under-appreciated hero of liberty and a student of Austrian Economic Theory, had this to say about the power of ideas:
“Economics is sometimes thought of as a very dry and dismal subject dealing with dusty tomes of statistics about material goods and services. Economics is not a dry subject. It is not a dismal subject. It is not about statistics. It is about the human life. It is about the ideas that motivate human beings. It is about how men act from birth until death. It is about the most important and interesting drama of all – human action.
“The main objective of economics is to substitute consistently correct ideas and actions for the contradictory ideas and actions inherent in popular fallacies…
“We all want things that are not necessarily essential, but we always choose those actions which we think will best improve the situation from our viewpoint. This means that the ideas that men hold determine their choice of actions. This means that the most important thing in the world is ideas.”
- Percy L. Greaves, Jr., Understanding the Dollar Crisis
What does economics have to do with liberty you ask? Economic freedom (property rights) and political freedom (human rights) are indivisible. They are merely two sides of the same coin – you cannot have one without the other.
As I write these words I can’t help but think about the power of ideas and the tipping points that can follow.
Dictionary.com defines “tipping point” as
-the culmination of a build-up of small changes that effects a big change
To see what I mean, click on the following link to view the number of people who are currently reading, or have recently read, these words and others like them:
The white flashing dots are those who are currently visiting this site. The red dots are those who have visited in the past. Imagine the potential for change if each of them became the example of kindness, forgiveness and personal responsibility amongst their own circles of influence. Imagine if we did the same.
There is no doubt that many of you who are reading this find yourself actively employed by institutions that possess destructive power. My heart goes out to those of you who are experiencing personal conflict as you learn more about the nature of freedom and violence. Hopefully you will not simply “follow orders” if asked to commit aggression against another human being.
I appreciate that many of you may have entered into these positions out of economic necessity before realizing the full consequences of this decision. Now you may be searching for a way out. While removing yourself from this situation is first priority, you have the opportunity to effect change where you currently stand. Look deep inside of yourself and find a way to rise above your circumstances and then become a part of the tipping point. Decide today to not participate in aggression against a fellow human being. Formulate a plan and then take action to free yourself. Help those around you who also wish to be free.
How do we spread the idea of liberty?
First we must understand it. Read books like Boundaries of Order – Private Property As A Social System – by Butler Shaffer and essays like Robert LeFevre’s A Way To Be Free and No Treason VI: The Constitution of No Authority – by Lysander Spooner. Stop believing in fictitious, external authorities. Take responsibility for your own actions. Study online at places like The Freedom School and The Mises Institute. Learn the rules of logic so you can discover and expose the fallacious ideas that enslave you. Flood the newspapers and internet with well-written arguments for freedom. Make it a goal to poke holes in unsound ideas.
I long for the day when a pivotal number of people discover the Philosophy of Liberty and begin to live by it.
Am I a dreamer?
Yes, I am. But it is the nightmare of the alternative that drives me – the nightmare of lethal ideas that will surely lead to our mutual destruction if left unchecked.
pfs-2011 Hans-Hermann Hoppe, Politics, Money and Banking. Everything You Need to Know in 30 Minutes from Sean Gabb on Vimeo.
Posted in Uncategorized
Hans-Hermann Hoppe interviewed in Australia (audio version here):
Michael Duffy: As it happens, we’re going to start the year with a guest from the right, but so far to the right you certainly couldn’t call him conservative. I’m not sure what you’d call him, he is right out of the ideological ballpark. His name is Hans-Hermann Hoppe and he’s a German intellectual who lives in America. He’s going to propose ways of thinking about government, society and the economy that are literally radical.
Paul Comrie-Thomson: And I think in this case, Michael, the word ‘literally’ is being used literally.
Michael Duffy: Indeed it is. Hans-Hermann Hoppe is probably the world’s leading living libertarian philosopher. He’s emeritus professor of economics at the University of Nevada, Las Vegas, and a distinguished fellow at the Ludwig von Mises Institute. Perhaps his best-known book appeared about a decade ago, and it had the challenging title Democracy: The God That Failed. His critique was from the libertarian right.
Libertarians are part of a pretty broad church, so how would Hans-Hermann Hoppe describe his position? Just where is he coming from?
Hans-Hermann Hoppe: I am a libertarian but there exists various wings of libertarians. I am a member of the wing that is referred to as the anarcho-capitalist libertarians or, as I prefer to say, I’m a proponent of a private law society, and a private law society is a society where the same laws apply to every individual and every institution, not just separate groups of individuals—government officials on the one hand and private citizens on the other—to whom different laws apply.
Michael Duffy: In general terms, is there one particular place that you’re coming from? Is there a sort of fixed point where you start whenever you consider a new subject or a problem? Are you interested in freedom, for example?
Hans-Hermann Hoppe: Of course I’m interested in freedom. I think freedom is defined precisely by the position that I take, that every individual and every situation is subject to exactly the same law and there is no group of individuals or no particular individual that has certain privileges that other people do not have.
Michael Duffy: Okay, let’s apply those beliefs to what you’ve written about the differences or the comparison between democracy and monarchy. I suspect most of our listeners would consider that democracy is a marked improvement and a dramatic difference from monarchy. How do you see the two?
Hans-Hermann Hoppe: First you have to define a state because monarchies as well as democracies are states, and then in the second step we have to explain what the difference between these two types of states are. States are defined as institutions that are the ultimate arbiter in cases of conflict on a certain territory, including conflicts involving the state itself. And secondly, states are territorial monopolies of taxation. So this applies both to monarchies and to democracies.
In monarchies, the head of the state considers the territory as his private property, and the people inhabiting the state territory as his renters who owe him rent payments. And of course he uses his privilege that he has as the ultimate arbiter in any case of conflict and a person who has the right to tax individuals to his own advantage. He exploits his population. This is also true in a democracy. Taxation exists in a democracy, just as much as it exists under monarchy. Democratic states also assume that they are the ultimate arbiter in any case of conflict, including conflicts involving themselves.
And there is distinction in democracy also between public law and private law. Public officials under democracy can do many things that private individuals in their private dealings would not be permitted to do. They can tax individuals on a private level, this would be called stealing. They can tax individuals and redistribute income in the private level, that would be considered stealing and fencing of stolen goods. They can draft people into the army or force them to work for the state, which on a private level would be considered enslaving people or kidnapping people…
Michael Duffy: But people choose this, don’t they? People will vote for democracy, for democratic governments.
Hans-Hermann Hoppe: Yes, that brings me to the difference between democracy and the monarch. Under monarchy it is relatively clear who the ruler is and what the rules are, under democracy you can hope that you will end up on the other side, that you will be on the receiving end, and that reduces the resistance against increases of taxes, against unjust verdicts in conflicts of a situation. But the most important difference between monarchy on the one hand and democracy on the other hand is that you replace somebody who considers himself to be the owner of the country with somebody who is a temporary caretaker of the country, and that does not improve matters, it makes matters much worse.
To give you an example, if I give you a house, in one situation I make you the owner of the house so you can determine who will be the heir, you can sell the house off and keep the receipts from the sale, while in the other case I make you the temporary user of the house. You can use to your own advantage the income that you can get off the house but you have no right to sell the house, you have no right to determine who will be the heir of the house.
Will you treat the house in a different way? And the answer seems to be quite clear; yes, you will treat it in a very different way. In the one case as the owner you will be interested in preserving the value, the capital value embodied in the house. In the other case, as a democratic politician where you can only use the house but don’t own it, you will try to increase your income that you can get from the house without any regard to the capital value embodied in the house, and you will engage in capital consumption, you will want to rob the country as fast as possible because, after four years or eight years you have no chance anymore to do it. So it is far more destructive of wealth formation than monarchy.
Michael Duffy: But isn’t it the case, using your analogy, that because of elections if I want to keep the house, keep my control of the house at the end of a period of four or five years, I have to act within certain limits? In other words, elected rulers, even if they do exploit people a bit, they have to keep that exploitation within boundaries in the hope of being re-elected.
Hans-Hermann Hoppe: But this is also true for monarchs. Monarchs have frequently been killed if they overstep their boundaries, and the dynasty of which they are a member is very much interested in keeping the dynasty in power. Democrats are far less frequently killed because people always have the hope that in four years somebody else will come to power. So the resistance against attempts to increase government power to increase the amount of taxes is far lower under democratic conditions than it is under monarchical conditions.
And in addition it should be said that competition for entry into government, competition is not always good. Competition is good when it comes to the production of things that are good. We do not want to have a milk monopolist, we do not want to have a car monopolist, we do want to have competition in the milk industry and the car industry, but competition is not good when it comes to producing something that is bad from the point of view of property owners. We would not want to have competition in people—who runs the best concentration camp, who is the best mugger on the street—and this is precisely the type of competition that we have in democracy.
Michael Duffy: It’s the case, isn’t it, that democracies on the whole have higher standards of living than other forms of government, and also the case that many people who do not live in democracies would like to, to the extent that we can gauge what they want. Why is that so, do you think? Are people deluded to want to live in democracies?
Hans-Hermann Hoppe: Democracies have won out in competition against monarchies in the course of history. The monarchical age has ended by and large with the end of World War I, so it would be unfair to say that democracies are in fact richer than monarchies because we compare the 19th and 18th century with the 20th century. Societies can grow richer despite the fact that governments grow richer. So my thesis would be if we would have kept monarchies of the style that we had in the 19th and 18th century we would be far richer than we are currently under democratic conditions.
Michael Duffy: Moving on, what might a libertarian society look like? How might it organise itself?
Hans-Hermann Hoppe: The basic idea is that if every institution, every person is subject to the same set of laws, then also the production of law and order has to be provided by freely financed institutions. There is no monopoly institution in this place. This would lead to a situation where we would indeed get some sort of contract of what will happen to us in certain situations of conflict, what the provider of security of law and order will do. They will have to describe what it is that they will protect, how will they protect it, what will they do in the case of a conflict between a client of a protecting agency and the agency itself, what will happen in the case that two security providers and their clients have conflicts with each other.
They will have to agree, for instance, that there will be independent arbitration in the case of conflicts between various protecting agencies, whereas if you compare that with the current situation, we have a situation where no contract exists between the citizens that are allegedly protected in their life and their property by the government, where it is not clear what will happen if the clients, the so-called clients of the state, are dissatisfied with the provisions that the state gives, where the clients have no possibility of appealing to independent third parties if it comes to a conflict between the state and the individual, where instead we have a situation where if you have a conflict with the state, some state agent, over property rights, it is another state agent who decides who is right and who is wrong in this case of conflict. And there you can predict of course what the outcome will be; they will by and large decide that they are always right.
Michael Duffy: Can I ask you for an example? In this sort of world you’re describing, say there was a law and everyone else agreed with it but I didn’t. So if, for example, I live in a street and I’ve got a one-hour parking sign out the front and I disagree with that but the other people in the street agree with it, what might happen then? I’m just trying to get a concrete idea of this.
Hans-Hermann Hoppe: The street would be privately owned. In a private law society there exists no such thing as public property, there exists only private property, and of course the owner of the private property lays down the rules that apply to this piece of private property. So conflicts like this would not even arise. Public property, on the other hand, generates conflicts. Allegedly we all own it. If we do not happen to agree, as if by magic, conflicts are almost unavoidable. If the unions want to demonstrate on the street and the car drivers want to drive on the street, both claim to be owners of this territory, and conflict is unavoidable. If everything is privately owned, it is perfectly clear whose rules apply and whose rules do not apply.
Michael Duffy: So if I own a house in a street, would that street belong to all the people in the neighbourhood or to another company? How would that work?
Hans-Hermann Hoppe: That can be arranged in various ways. It might be owned by all the residents on the street, it might be owned by a third party and you have the right to access your property. Obviously nobody would buy any property if he did not have the right to access his own property, so you would have a contract with the person who owns the street. Or there are neighbourhood associations that jointly own the street and make joint decisions, as in stock companies or as in gated communities or institutions of that kind.
Michael Duffy: And if I didn’t agree with them I could leave basically, I could sell my house and…
Hans-Hermann Hoppe: And then you could leave.
Michael Duffy: In Australia we have a large number of people who are on welfare, poor people who are looked after by what we call the welfare state, possibly more than in America. What would happen to those people under the sorts of arrangements you’ve been describing?
Hans-Hermann Hoppe: First of all I think that a large number of voluntary organisations would spring up, voluntary donations would dramatically increase given the fact that no taxes have to be paid. Currently the situation is such that you pay massive amounts of taxes and then people of course have the feeling why should I also support people who have this condition or that condition given that I am already paying an enormous sum of taxes.
Second, I think there would be greater pressure exerted on people not to become dependent on welfare because they are not entitled to it. They would have to behave in such a way that they satisfy their donors in some way, they have to be nice to their donors, whereas currently the situation is you feel entitled to these things and that breeds of course bad behaviour. Whatever you subsidise through taxes you will get more of it. If you support poor people, this does not eliminate poverty, it increases poverty, it increases the incentive to stay poor or to become poor. Whenever you subsidise people because they suffer from drug addiction or alcoholism, you increase of these forms of behaviour instead of discouraging them.
Michael Duffy: Do you think the welfare state can survive?
Hans-Hermann Hoppe: No, the welfare state will ultimately collapse for the same reason that communism collapsed. All Western welfare states will not be able to repay their debts, will not be able to fulfil their obligations that they have assumed vis-à-vis people who are retiring. The only way that they can fulfil it is by engaging in a massive amount of inflation, that is printing up the money in order to give the impression that they might fulfil the obligation, with the consequence of course that the purchasing power of money drastically falls and an expropriation of productive individuals will take place.
Michael Duffy: I’d like to ask you a bit more about economics but unfortunately we don’t have a lot of time left. Just very generally, can you tell us a few of your most important thoughts about how you think the international financial system ought to be arranged differently?
Hans-Hermann Hoppe: The fundamental problem that we have which began in its most drastic form since 1971 is that all governments are nowadays on a pure paper money standard. All governments or their central banks can create money out of thin air. Increasing the amount of money in existence does not increase wealth in society, it is just additional pieces of paper. There is not one additional consumer good resulting from more money being printed, there is not one additional producer good resulting from more money being printed. If by money printing we could make societies richer, there would not be a single poor society. In fact, there would not be a single poor person on earth.
All that this money printing does is redistribute income and wealth from those people who print and get and spend the money first, and it impoverishes and expropriates who do get the newly printed money last, who are on fixed incomes and are confronted with rising prices resulting from the fact that additional money was being printed.
So the most important monetary reform that we can hope for would be the abolishment of all central banks and the return to a situation that existed for most of mankind, namely a situation where money is a regular commodity that must be produced in a costly way, such as gold and silver, by the market. Again, no monopoly in the production of money but competition in the production of money, and money being a regular commodity that cannot be generated out of thin air.
Michael Duffy: What about the role of intellectuals? We’ve never had anyone like yourself on our program before and that is disappointing. Why don’t more people think like you or it least engage in more diverse thinking about freedom?
Hans-Hermann Hoppe: The answer to that one is very easy. Most intellectuals are state employees, and of course they know where their money comes from. While that fact does not determine in the Marxist way how people think, it definitely helps to know where your money comes from. The demand for intellectual services on the market is far lower than the impression that intellectuals themselves tried to spread. Their salaries would probably be significantly less, there would be significantly less so-called intellectuals because they realise that their biggest helper is the state. They tend to be in favour of state institutions, tend to be in favour of having public education, public funding for research. Again, most research that is being done, especially in the social sciences, appears to me as a big waste of money. Societies would be richer if many of these so-called research projects had never been carried out at all.
Michael Duffy: Professor Hoppe, thanks very much for your time today.
Hans-Hermann Hoppe: Thank you very much.
Michael Duffy: Hans-Hermann Hoppe is emeritus professor of economics at the University of Nevada, and a distinguished fellow at the Ludwig von Mises Institute.
In coming weeks here on Counterpoint we’ll be talking to another prominent libertarian, David Hart. He’s an Australian historian, now resident in the US, a self-described ultra-sceptic who runs the important website, the Online Library of Liberty, and we’ll hear his views on freedom, war and the growth of the state.
Posted in Uncategorized
Tagged anarcho-capitalism, anarchy, austrian economics, autarchy, Democracy, economics, Freedom, Hans-Hermann Hoppe, liberty, monarch
(Interviewed by Louis James, Editor, International Speculator)
L: So Doug, a lot of readers are concerned about what’s going on in Europe. Is this the beginning of the proverbial “it?” Or can the Eurozone be saved?
Doug: In brief, the answers are “yes,” then “no” – and a “good riddance” to both the Eurozone and the euro. But most people think the old order should be maintained at almost any cost. That would include George Soros, who recently penned an article called Does the Euro Have a Future?
Now, I don’t normally look to Soros for economic commentary, despite the fact that he’s one of the shrewdest and most successful speculators in the world. He does, however, represent the way the Davos people, Eurocrats, and the ruling classes in general think. But just because he’s made a lot of money doesn’t make him an expert in economics, any more than financial success is proof that Ted Turner, Bill Gates or Warren Buffet know anything about economics. They’re all idiot savants, a bit like Dustin Hoffman’s character in Rain Man. But that’s another subject.
Soros writes: “The political will to create a common European treasury was absent in the first place, and since the time the euro was created the political cohesion of the European Union has greatly deteriorated.” He’s absolutely right about that and goes on to say that to create a common European treasury, the EU would have to have the power to tax. So, he’s saying that the euro should be preserved, and that to do that, it should be backed by wealth extracted by force from the average person in Europe.
But that’s the problem with every currency in the world today; they’re not backed by a commodity, but only by the ability of government to steal from the people. And the euro doesn’t even have that going for it.
L: And the power to tax is an essential, defining characteristic of the nation-state. It’s the thing that empowers it to exist and separates it from voluntary organizations. To create that power in Europe would really be to turn the place into one single country. It wouldn’t be long before they had a European army.
Doug: Exactly. Right now the Eurocrats in Brussels really only have the power to regulate, which is bad enough. But if the European Union had the power to tax, it would become an actual empire. Especially if they then created a European army – there’s no telling what kind of mischief they’d get into.
On the bright side, they can’t really afford an army. That’s the bright side of all these governments being bankrupt: They spend way too much on welfare and debt service to afford much warfare… I guess that makes welfare and debt good things, in a perverse way.
L: [Laughs]
Doug: Anyway, Soros went on to observe: “The euro crisis could endanger the political cohesion of the European Union.” That’s true too, of course. The EU is a completely artificial union. The Swedes are very different from the Sicilians, and the Portuguese very different from the Austrians. These people have little in common besides a history of fighting with each other. Force them together into a phony union, and they’ll become mutually resentful, the way the Germans and the Greeks now are. The EU was put together partly to avoid future wars, but it may turn out to be a war incubator. It makes no sense for there to be a European Union at all.
Incidentally, people think of these countries – Italy, France, Germany, and so on – as though they are fixtures in the cosmos, but they aren’t. In their current forms, they’re all newcomers on the stage of history.
L: You mean the gods didn’t affix them to the celestial spheres, up there with the stars? I could have sworn Jupiter told me he did…
Doug: [Laughs] No. The average person doesn’t realize that the country we know as Italy today was only created in 1861, a consolidation of many completely independent and very different entities that had been separate states since the collapse of the Roman empire. Germany was only unified in 1871, out of scores of principalities, dukedoms, and whatnot. Both unifications were very bad ideas. Even today, there are separatist movements in big Western European countries, like the Basques in Spain, or those in the United Kingdom who wish it weren’t quite so united.
L: So what’s the alternative?
Doug: Of course, the ideal would be for there to be seven billion little countries on the planet – each one a sovereign individual. But I’ll take what I can get in the meantime, and would rather see smaller states competing for citizens as customers – although I don’t really like that analogy, because states are not voluntary organizations, nor do they provide much in the way of useful services. Anyway, a more cohesive European Union is a step in the direction of Orwell’s Oceania, which was in constant warfare with Eurasia and Eastasia. It’s odd how the world is becoming much more like 1984 in some ways at the same time that the nation-state itself is collapsing.
What would have made sense is for Europe to have become a free-trade and -travel zone. No customs duties and no need for work permits or passports. A free-enterprise union – created simply by dropping barriers – would have facilitated all sorts of business and job creation. Instead, idiotically, the Europeans just created yet another layer of government in Brussels. Which is rather ironic in that Belgium is itself a non-country, created out of two very different societies – Flanders and Wallonia. Now there’s a wannabe megagovernment bent on finding new ways to regulate enterprise out of existence. And if people like Soros are heeded, it will have the right to tax in addition, in order to give value to its essentially worthless currency.
All this would be a non-problem if they simply used gold – which is what, as I’ve long predicted, is happening, starting with the gold-for-oil trade between India and Iran.
People talk about the EU as being a way to avoid new wars in Europe. But they forget that in the 19th century, Europe had fewer wars than ever before or since. At that time, “mark, ” “lira, ” “franc, ” and “pound” were all just names for specific amounts of gold. It worked very well; and to paraphrase Ludwig Von Mises: When goods cross borders freely, soldiers don’t – or at least are less likely to.
All the gyrations and machinations these Eurocrats are desperately rushing into place to try to save the unnecessary and counterproductive euro are…
L: …not just the wrong thing, but the exact opposite of the right thing.
Doug: [Laughs] Just so. Back to Soros. He has a prescription for preventing a meltdown, of course. He advises: “First, bank deposits have to be protected.” In other words, to discourage people from bailing out of unsound banks and destabilizing a corrupt banking system, all bank deposits should be guaranteed. That’s a catastrophic idea. It would further encourage all sorts of bad lending by incompetent bankers while sucking hundreds of billions of capital from productive parts of the economy. He also asserts that some banks in defaulting countries have to be kept functioning, in order to keep the economy from crashing entirely. That’s another ridiculous idea, plundering the prudent and productive to pay for the profligate.
If banks were run according to sound banking principles, with a clear division between demand deposits and time deposits and no fractional reserve banking, we wouldn’t have to worry about any of these issues.
But instead, Soros goes on to write that the European banking system should be recapitalized and put under EU supervision. I want to know how this recapitalization would be done – all those governments are bankrupt. All that Soros is suggesting is to make a bunch of national problems into one big continental problem. For all anyone knows, the Fed is creating trillions of dollars to give to the EU. The only thing that’s really clear is that we’re moving out of the eye of the hurricane and back into the storm. But it will be much, much fiercer than what we saw in 2008.
Soros also states that government bonds have to be protected from “contagion.” Whatever that means, the implication is more central control and throwing more taxpayer money at the insoluble government problems. The bankrupt banks will have to lend the bankrupt governments money, so they can pay their bonds off, while at the same time the same bankrupt governments lend the bankrupt banks money, so they don’t go under. It’s all just a ridiculous shell game.
L: It all sounds like a call for creating more unbacked currency units. If their only answer is just to run the printing presses, it’ll be Weimar hyperinflation all over again.
Doug: Yes. Soros’ bottom line is: “There’s no alternative but to give birth to the missing ingredient: A European treasury with the power to tax and borrow.” This, he claims, is “the only way to forestall a possible financial meltdown and another great depression.” Forestalling the depression is impossible. All that can be done is to make it less severe – by doing exactly the opposite of what Soros recommends.
L: And that would be…?
Doug: My view, as you well know, is that they shouldn’t forestall the meltdown, but should let the market correct past mistakes and get on with building real economic growth for the future. Nietzsche was right when he said, “That which is about to fall deserves to be pushed.” But it really doesn’t matter what these fools do; we’re in the early stages of the Greater Depression. It’s going to have a life of its own.
Soros’ solutions are counterproductive band-aids. But since he got to offer solutions, I’m going to offer some too. For starters, the national debts of all these countries should be defaulted on, including the United States. Those debts constitute an unethical mortgage without consent on the next two or three generations of people as yet unborn as a result of the excess consumption of their parents and grandparents. The government debt should also be defaulted on to punish the people stupid enough, or unethical enough, to lend these states the money they’ve used to do all the destructive things they do.
Second, central banks should be abolished and thereby fractional reserve banking as well. That would force banks to run on sound, classical terms, and depositors would be induced to seek out the most sound and secure banks.
Third, there shouldn’t be national currencies. Commodities – with gold most likely the popular choice – would again be used as money.
Fourth, most financial regulations and taxes – especially income taxes – should be radically reduced or eliminated. At the same time, government spending should be cut even more radically. These governments, if their existence is to be tolerated at all, should be strictly limited to doing nothing more than protecting people from overt force and fraud.
L: Sounds good to me, but you know that’s not gonna happen. So, tune in your guru-vision for a moment and tell us what you think is most likely to happen. Does Soros get his wish and we see a new European superstate emerge? Or does the EU disintegrate?
Doug: There’s not a snowball’s chance in hell that the EU will turn into a superstate. The chances are much, much better that it will fragment. If these countries have breakaway movements within them, how could they possibly succeed in peacefully joining together?
If you think about it, the Soviet Union was a sort of Eastern European Union, and it disintegrated. Yugoslavia also showed what happens to artificial European unions, as did Czechoslovakia. These are all straws that show which way the wind is blowing in Europe.
That’s quite apart from the fact that trying to compact all of these different ethnicities, languages, religions, cultures, and so forth together into one giant nation-state is illogical, counterproductive, dangerous, and pointless.
L: So, how long do you give the EU before it breaks up? And the euro?
Doug: Well, as you know, one should never predict both an event and the time it will take place. But I’ve long said that, “While the US dollar is an ‘IOU nothing, ‘ the euro is a ‘who owes you nothing.’” So I think the euro will reach its intrinsic value long before the dollar does. The euro – in anything like its present form – will cease to exist within two to three years at the outside. If I had a lot of my wealth in euros, I would get it out ASAP. My favorite alternative for protecting wealth, of course, is the precious metals: gold and silver. If you want to speculate for gains on this trend, I think there will be a bubble in the mining stocks, many of which are cheap right now.
[Right now there are seven tiny mining companies that are ripe for impressive gains that could well be imminent. Learn what they are and how you can get in on them.]
L: For new readers, Doug’s notion of the intrinsic value of the euro, the dollar, or any unbacked “fiat” currency is zero. They are literally worthless and only useful as long as people imagine otherwise. So much for the euro, but what about the EU itself?
Doug: Centripetal force will eventually tear it apart, with the EU as a whole disintegrating long before its individual parts – France, Italy, Germany, the UK, etc. – fall apart.
L: How long is “eventually?” Can the EU itself last long after such a crushing setback as the collapse of the euro?
Doug: Probably not – they’ll likely go in close succession. Europe is just in a world of trouble; the continent reminds me of that cruise ship that sank off the coast of Italy recently. They are dying financially, with all the debt bankrupting governments, businesses, and individuals. They are economically in a lot of trouble, with stifling regulations and taxes. They are demographically in a lot of trouble, with birth rates far below replacement in general, except among African and Muslim immigrants who are not integrating. Europe has long been a hotbed of religious, ethnic, and race wars – quite frankly I see the next one building up right now.
L: What about Eastern Europe? They have different problems – like endemic corruption and other Soviet legacies – but they tend to be very pragmatic and willing to work hard.
Doug: Yes, there’s a dichotomy. The bad news is the Soviet legacy hanging over them, but the good news is that they’ve experienced naked socialism, and they know what it’s really like. A lot of thinking people there are experiencing shock therapy and leaning much more towards free markets than people in the West. I’m definitely more optimistic about Eastern Europe than Western Europe. However, the general decline of Europe – which started with World War I – is going to continue. I only hope Europe just declines in relative terms, not absolute terms.
The fact of the matter is that I’m most optimistic about the Orient. That’s where the action has been and is going to be. I’m also favorably inclined toward Latin America, which has huge problems but is, at least, mostly out of harm’s way from the evolving Forever War.
L: Doug, you’re on record as saying that China is in a bubble and that it’s going to pop. How does that square with your being optimistic about the Orient? You can’t be thinking Japan will take the lead again…
Doug: No, certainly not. I do think China is ripe for a fall, but it’s a matter of the short vs. the long run. I’m very bearish on China in the short term, but after the current system washes out, I think it’s going to be the place to be – or at least, that area. I think China is another country that has excellent chances of breaking up into five or more separate countries.
L: Wow… okay… More investment implications, besides getting out of the euro?
Doug: Buy gold and silver. Don’t be fooled into thinking the dollar is strong just because the euro is weaker.
L: Very well; thank you for your thoughts.
Doug: My pleasure. I’ve got some other things on my mind, so we’ll talk soon.
L: Looking forward to it. Have a great evening, Tatich.
Doug: You too, Lobo.
[Editor's Note: For new readers, "tatich" is Mayan for "big chief."]
The following statement by Ron Paul was issued by his campaign:
The police state in this country is growing out of control. One of the ultimate embodiments of this is the TSA that gropes and grabs our children, our seniors, and our loved ones and neighbors with disabilities. The TSA does all of this while doing nothing to keep us safe.
That is why my ‘Plan to Restore America,’ in additional to cutting $1 trillion dollars in federal spending in one year, eliminates the TSA.
We must restore the freedom and respect for liberty that once made American the greatest nation in human history. I am deeply committed to doing that as President of the United States.
Senator Rand Paul was detained for a period this morning at Nashville Airport.
From the BBC:
Public trust in government has suffered a severe breakdown across the world, according to the Edelman Trust Barometer.
Governments have been blamed for the financial and political chaos of 2011.
In 17 of 25 countries surveyed governments are now trusted to do what is right by less than half those questioned.
Overall trust in government fell by nine percentage points to 43%.
Trust in business also fell, from 56% to 53%.
Although businesses saw less severe declines in trust, countries at the heart of the eurozone saw sharper decreases.
Businesses in Spain, France and Germany saw trust decline by 21, 20 and 18 percentage points respectively.
China was the only country to see a significant rise in trust in businesses, up from 61% to 71%.
Trusting ‘me’
Richard Edelman, president and CEO of Edelman, said: “Business is now better placed than governments to lead the way out of the trust crisis”.
“But the balance must change so that business is seen both as a force for good and an engine for profit.”
Alongside these steep declines in trust in institutions such as governments or businesses, the survey highlights a dramatic switch in those whom people say they now trust.
A “person like me” is now one of the top three credible sources, said those surveyed, only trailing academics and technical experts.
Social networking, microblogging and content-sharing sites saw the most dramatic percentage rises as trusted sources of information, jumping by 88%, 86% and 75%.
Despite these gains, traditional media and online search engines are still the most trusted sources of information for general news and information, says the survey.
Edelman’s 2012 trust Barometer was released in the run-up to this year’s World Economic Forum in Davos, where it will be presented in more detail.
Edelman’s online survey sampled 25,000 respondents among the general population, with an over-sample of 5,600 “informed” people from the upper end of society – college-educated, with household income in the top quarter – across 25 countries.
From thedailynewsegypt (sounds a lot like autarchy):
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| CAIRO: They do not believe in governments, they boycotted the elections, they demand “direct democracy” and they’re associated with chaos and have been targeted by the military and some Islamists.Egypt’s anarchists are anticipating a crackdown before the first anniversary of the January 25 uprising. They are perceived as seeking chaos; villains who want to bring down the state, defy authority and spread lawlessness.
The word ‘anarchy’ in Greek means “no authority.” Anarchists’ central belief is that “no man is good enough to be another man’s master,” and that “good people do not need laws to tell them to act responsibly, while bad people will find a way around the laws.” Anarchy became the new bogeyman — a place once reserved to the Muslim Brotherhood under the Mubarak regime. Many believe that this ideology is dangerous to Egypt. “Egypt, the homeland, is not the same as the system or the state or the government. The people called for the overthrow of the regime and this means to bring the current system or the state down, as it happened before with the Abbasids, Ayyubids, Ottomans and others whose state was overthrown, but Egypt was not harmed,” said self-proclaimed anarchist Yasser Abdel Kawy, an artist, photographer and graphic designer. The state, according to Abdel Kawy, is a means to practice authority which is why it needs to be replaced with a self-governed society. “I have no fear or worries about what may happen to Egypt if the state is gone. We don’t have this sharp division or difference when it comes to ethnicity or religion,” he added. Global movement In direct democracy, decision-making comes from the people directly without mediators like members of parliament. Similar protests and occupy movements known as “Take the Street” evolved in different parts of the world like the United States, Spain and Italy. “It is true that much of the ‘Occupy’ movement can be traced to Anarchist ideals. This can’t be explained by anarchist propaganda but more by the failure of the current system of capitalism and parliamentary democracy,” said architect Tamer Mowafy, who describes himself as an anarchist. People feel vulnerable to the incisive attacks on their standards of living and no longer believe that politicians will help them, Mowafy said. Leftist parties and the democrats in the US proved themselves useless. On the other hand, traditional Marxist alternatives have been discredited beyond reclamation after 1989, he said. “It is evident that people taking part in the ‘Occupy’ movements almost spontaneously embrace anarchist principles. The movement is leaderless, all decisions are made within a general assembly, and instead of majority rule consensus is always sought,” he added. “Anarchism means struggling against the authority of the state and capitalism; that’s why if you’re not a leftist, you can’t be anarchist,” said Yasser Abdullah, a freelance translator. Anarchism is a socio-political movement that mobilizes society without seeking power, he added. Horizontal authority Abdullah gave the example of the Ultras, Egypt’s organized football fans. These groups are horizontal networking movements with grassroots support. They are leaderless and have joined the revolutionaries in the common fight against police brutality, and so they share common ground with anarchists. Abdullah belonged to a communist entity before embracing anarchism. His father, he recalled, “was one of the workers who made the real wealth of Egypt for 42 years until retirement, but never tasted it.” The fear of anarchism, Abdullah explained, stems from the “fear republic we live in.” Egyptians have been practicing various brands of anarchism not related to politics unknowingly, the most popular example of which are the monthly co-ops, a communal money saving system which is entirely managed by the individuals in the group, replacing banks. “In the past, people governed themselves when there was no government. However, we do not mean that we’ll restore the tribal system or go back to pre-modern times, but we seek more developed forms of ruling based on cooperatives, volunteerism and no central authority,” Abdullah said. Even in times of natural disaster like earthquakes, he said, people self-organize and divide tasks between them. There are no holy texts or models to follow in applying anarchism. It is open to new ideas and is tailored to the needs of diverse societies. “In some areas, an anarchist model would include some centralized authorities when it comes to foreign representation and the military,” Abdullah said. “As long as there are foreign threats, the army can be kept as it is … as an institution.” There’s no defined vision for how the society would look like. Yet, there are some basics like having no authority but voluntary cooperatives, syndicates and a general assembly that comprises of all citizens to ensure the maximum level of rights and freedoms in a society where all people are equal. It also works for a fair distribution of wealth from a leftist point of view. Not a single group of people would who have the upper hand in the society, whether businessmen, politicians or members of parliament. Laws are what people decide according to the norms and traditions, but each case would have a different ruling based on the circumstances. “The ideology is ideal and unpopular in Egypt. It seeks a utopian society where there are no social class differences and no authoritarian state as in the police or the army, which is difficult to achieve”, said Dr. Mostafa Kamel El-Sayed, leftist political science professor at the American University in Cairo. Only small communities around the world find their inspiration in anarchism, but historically, it’s hard for people to live outside the context of the state, he believes. “They are not dangerous, however. They do not pose a security threat. Bringing the state down doesn’t mean using violence against some people in particular. This is the leftists’ rhetoric and it should be clearly understood to the society,” he added. A decade ago, Dr. Heba Raouf Ezzat, political science professor at Cairo University, wrote an article titled, “Anarchism: The philosophy that translation was unfair to”. The Islamist academic explained how anarchism’s accurate translation is more close to “state-less society” rather than “chaos”. “As the national state finds itself in a growing crisis amid globalization, anarchic ideas on how to manage a society without a state gains attention if developed more,” Raouf wrote. Recent developments like global networking, rise of the civil society and growing democracy in a way that fosters localities have common ground with anarchism according to Raouf. Worldwide Utopia “However, within the current context, nobody in his right mind can ask for the army to be dissolved,” he noted. The army, like any other national institution, should be under the control of elected civilians and its budget revised by people’s representatives to protect national security, he added. Viral Nassar, an Egyptian-French, believes in the ladder theory. “It will be pointless to spread anarchism now in Egypt. People don’t understand basic politics to grasp the most infamous system ever and adapt to it,” he says. “Democracy with all its deceits will let people know how ugly and bloody democracy is,” he added. Anarchic models include Christiania, the Freetown of Denmark. It’s an example of how a society can rule itself with no supervision from the municipality of Copenhagen which the town belongs to geographically. Only nine rules govern Christiania, some of which are: no weapons, no hard-drugs, no violence, no bulletproof clothing, no sale of fireworks and no stolen goods. Michael Lund, journalist at Denmark Radio, said that Christiania has developed as a unique experiment where nobody owns land or homes and everything is decided by debating until everyone agrees. It has produced artists, new designs of everything from bicycles to clothes and is one of Denmark’s biggest tourist destinations. “However, there are also problems. The idea of no leadership and everyone having to agree on everything has made it very difficult for the inhabitants to make fast decisions about anything. Also, Christiania’s belief that cannabis is not illegal has attracted gangs that sell hashish,” said Lund who lives less than 2 km from the “free city” and passes by it regularly. He has also visited it numerous times. The people of Christiania, who often don’t trust the police, have not been able to keep these gangs out, which has let to violent incidents between different gangs, Lund said. “There’s also a critique that Christiania has become a closed society, where only people who know somebody there can live — which is actually opposite to the original idea of the free city”, he said. Although the January 25 revolution was leaderless — which is favored by anarchists who prefer to be unknown as soldiers in the life battle or “anonymous” as they prefer to call themselves — Abdullah stressed that the revolution found anarchy by itself and it was not anarchists who made it. “It’s a disgrace to say that anarchists are behind the revolution because if we were, [the Supreme Council of the Armed Forces] wouldn’t be ruling. We should have never left after Mubarak stepped down. Unfortunately, the people like to re-invent the wheel and fall into the same mistakes of other revolutions,” Abdel Kawy noted. Creative chaos? “We seek to build libertarian constructs within the current society, mainly cooperatives, labor unions and syndicates. Lower levels in the society as in localities are the most jammed because as you go smaller, more issues become common to inhabitants of such localities. Once people become confident of their ability to manage their own affairs democratically, they will seek to extend the space where they can practice self-management,” Mowafy said. How would a country of nearly 80 million govern themselves making decisions altogether? “Think outside the box,” said Abdullah. “Voting can be on Twitter.” |
From EPJ:
Joe Fetz emails:
The more that I learn about economics and political philosophy the more I feel powerless to change what is going on. In fact, it is almost depressing to know the truth of the world around you while also knowing that everybody else around you is completely clueless. I am certainly not a smart man, but I do my best to attempt to educate people with my own knowledge, but it is like beating myself in the head with an old boot. Sometimes I almost wish that I was still ignorant and just going through life just like everybody else.
My question is: Do you ever feel like this? Like maybe you might be happier if you didn’t know what is really going on?
Joe, it is a very tall order to change the world. You are not the only one that has felt despair. Remember, the great economist Ludwig von Mises wrote:
Occasionally I entertained the hope that my writings would bear practical fruit and show the way for policy. Constantly I have been looking for evidence of a change in ideology. But…I have come to realize that my theories explain the degeneration of a great civilization; they do not prevent it. I set out to be a reformer, but only became the historian of decline.
But as Mises taught, the world is a very complex place, and in the sphere of political and social change it is very difficult to understand how all factors will play out. Strong men willing to advance the ideas of liberty can have an impact. Murray Rothbard, Lew Rockwell and Ron Paul through their consistent advocacy of liberty have beyond question delivered the message of the importance of liberty to a far greater audience than could have ever been imagined just 40 years ago.
That said, as you point out, the overwhelming majority are clueless and easily swayed by demagogues. Thus, it would be foolish to think that the battle for liberty is anywhere close to being won. In fact, it is downright scary as to what direction the masses may be led and what this will mean for our freedoms.
Frustration at being unable to convert all the boobsie overnight is a sign of looking at the battle in the wrong way. The battle should be fun and exciting. Just like a good chess game or a one-on-one basketball game can be fun. Two of the greatest promoters of liberty, Rothbard and H.L. Mencken had fun poking at the interventionists.
It is not difficult to imagine the twinkle in the eye of Mencken when he wrote:
Every decent man is ashamed of the government he lives under.
or when he wrote:
A national political campaign is better than the best circus ever heard of, with a mass baptism and a couple of hangings thrown in.
And we must never forget the famous Rothbard laugh. I personally remember him chuckling when he relayed the story of a report in the news that some NYC government agency wanted to make NYC prettier by banning hot dog carts.
And think of the fun Rothbard must have had by infiltrating the Maoist wing of a Leninist-Trotskyite party:
Rothbard was a battler. He never stopped. Read his writings in The Libertarian Forum and The Rothbard Rockwell Report. I am guessing, he loved the battle, itself. He loved to bash the enemy. Indeed, what Rothbard wrote about Mencken most assuredly applied to Rothbard himself:
Any man who is an individualist and a libertarian in this day and age has a difficult row to hoe. He finds himself in a world marked, if not dominated, by folly, fraud, and tyranny. He has, if he is a reflecting man, three possible courses of action open to him: (1) he may retire from the social and political world into his private occupation: in the case of Mencken’s early partner, George Jean Nathan, he can retire into a world of purely esthetic contemplation; (2) he can set about to try to change the world for the better, or at least to formulate and propagate his views with such an ultimate hope in mind; or, (3) he can stay in the world, enjoying himself immensely at this spectacle of folly. To take this third route requires a special type of personality with a special type of judgment about the world. He must, on the one hand, be an individualist with a serene and unquenchable sense of self-confidence; he must be supremely “inner-directed” with no inner shame or quaking at going against the judgment of the herd. He must, secondly, have a supreme zest for enjoying life and the spectacle it affords; he must be an individualist who cares deeply about liberty and individual excellence, but who can – from that same dedication to truth and liberty – enjoy and lampoon a society that has turned its back on the best that it can achieve. And he must, thirdly, be deeply pessimistic about any possibility of changing and reforming the ideas and actions of the vast majority of his fellow-men. He must believe that boobus Americanus is doomed to be boobus Americanus forevermore….A serene and confident individualist, dedicated to competence and excellence and deeply devoted to liberty, but convinced that the bulk of his fellows were beyond repair, Mencken carved out a role unique in American history: he sailed joyously into the fray, slashing and cutting happily into the buncombe and folly he saw all around him, puncturing the balloons of pomposity, gaily cleansing the Augean stables of cant, hypocrisy, absurdity, and cliché, “heaving,” as he once put it, “the dead cat into the temple” to show bemused worshippers of the inane that he would not be struck dead on the spot. And in the course of this task, rarely undertaken in any age, a task performed purely for his own enjoyment, he exercised an enormous liberating force upon the best minds of a whole generation.
On a personal level when we discuss economics, politics and philosophy, we must seek to tie our opponents up in knots. Don’t battle them with long oratory. If they are thinkers, give them a book. But if they are boobs, counter them with questions. If they are in favor of the minimum wage, ask them why it shouldn’t be at $500 per hour then? Ask them why they think the laws of supply and demand don’t work for wages? If they are against gold as money because “You can’t eat gold,” ask them if eating money is something that should be essential to a money.
The Socratic method is very powerful against the unthinking masses. They haven’t thought out their positions, so the right questions can cause them to get so backed into a corner that they may even realize the absurdity of their position. Naturally, the more you practice the Socratic method, the better you get at. It is truly fencing against an unarmed man.
On an even more personal level, the more you know about how the economy works and what the future may hold, the better off you are.
To know that accelerating price inflation may be coming, that the Federal Reserve causes the business cycle by its money manipulations, that the ever growing police state may result in serious infringements on our liberties is all very valuable knowledge. It means we can prepare for what is coming. Ignorance of these possibilities is not bliss, it is extremely dangerous.
Jews in Germany and Austria died because they were ignorant of the political situation developing around them. Sigmund Freud and Ludwig von Mises, because they were not ignorant of the environment, were able to flee and survive.
The more you know and correctly understand the developing situation the better off you are. Knowledge is power. Ignorance is mental blindness.
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