Mr. Greenwald and Socialism vs Corporatism

On Twitter yesterday, Glenn Greenwald made a tweet which prompted a small exchange between us:

Glenn Greenwald ‏@ggreenwald

The Right’s weirdness: assassinating citizens w/o due process (Yay, Freedom!)- bolstering private health care industry (socialist tyranny!)

He ended the exchange with:

Glenn Greenwald ‏@ggreenwald

@MarkStoval I know it is – but it’s not socialism

Lately many “conservative” opponents of Mr. Obama have indeed characterized this administration as socialist, or having strong socialist leanings. I differ with this characterization and so told Mr. Greenwald. I see he agrees with me that the “health care situation” is not “socialism” but I don’t know if he agrees that it is not capitalism either:  he may be using that common, incorrect definition of capitalism that says it is the same as crony-capitalism, fascism, or corporatism.

Mr. Obama does not believe in free-markets, on the contrary, he has demonstrated his fundamental hostility towards the truly free market. But an honest examination of his policies and actions in office reveals that he is a corporatist just like Mr. Bush who preceded him in office. Mr. Obama is very much a corporatist and in many ways that can be more insidious than being an outright socialist.

Socialism has always been defined as government ownership of the means of production; it is a system where the government directly owns and manages businesses. Corporatism is different. It is a system where businesses are nominally privately owned and controlled but are, in fact, controlled by the government. In a Corporatist State we see government officials acting in collusion with their favored corporate interests to put polices in place that give those interests a highly favored position, if not a near monopoly position. This is obviously to the detriment of both competitors and the general public.

A careful examination of the “health care” policies of the Obama administration shows the practice of corporatism. As an example the health care bill that the SCOTUS just ruled constitutional does not establish a Canadian-style government-run single-payer health care system. Instead, it relies on mandates forcing every American to purchase private health insurance or to pay a fine which is now called a “tax” or a “penalty” depending on who in government is talking. Large insurance and pharmaceutical companies were enthusiastic supporters of this new legislation because they knew that they would be enriched by Obamacare. To call the President a corporatist and his health care bill “crony-Capitalism” is a more accurate description of the President’s agenda and actions than to call it “socialist”.

To call Obama a “socialist” allows the President and his defenders room to easily deflect that charge by pointing out that the historical meaning of socialism is government ownership of industry and everyone can see that the medical industry is still remains nominally in private hands. (please notice the word “nominally”)

We need to understand that though the current system is not pure socialism, neither is it free-market (laissez-faire) since government controls the private sector through taxes, regulations, and subsidies. Future Statists from the collectivist left to the fascist right will be looking to blame the “free market” when this boondoggle fails as it most assuredly will. We must not allow the disastrous results of corporatism to be ascribed incorrectly to free market capitalism. Government is the problem; it can never be the solution.

An Aardwolf on the Empire

Ray McGovern wrote in a resent column that in CIA jargon ‘an “Aardwolf” is a label for a special genre of intelligence report from field stations abroad to headquarters in Washington. An Aardwolf conveys the Chief of Station’s formal assessment regarding the direction events are taking in his or her country of assignment – and frequently the news is bad.’ It is claimed that an Aardwolf is relatively rare and is so important that it is read by Washington staff avidly.

A special report from the the agent of another country concerning the USA to his bosses in another land at this point in time might well be an “Aardwolf” report. The strongest empire the world has ever seen is falling into tyranny, barbarism, corruption, and is in real danger of becoming the strongest police state the world has ever seen.

The US Empire is bankrupt financially and may become highly dangerous to other countries around the world as it comes spinning apart due to running out of money and credit. We all watched in horror as the USSR came apart fearing that they would take the world down with them as a major nuclear power. Russia and the world survived that experience but can the world survive the USA coming apart?

The Empire is also bankrupt morally and ethically. Crony-Capitalism, corruption, fraud, dishonesty, and perversions are the order of the day here among politicians and Empire agents at all levels. Hypocrisy has reached levels unseen on planet Earth before.

The US empire has announced to the world with the  “National Defense Authorization Act” that the new American way is guilty until proven innocent. This is only one in an endless line of liberty smashing moves the US government has made over the last hundred years. And more will come. Along with the idea that you are guilty until proven innocent is the idea that the Empire can hold you in jail without even charging you for as long as it desires. An in unison with these facts is the idea that no citizen deserves any privacy at all.

The US Empire has now reached the point where overly militarized police agents are swarming the country terrorizing the population to keep them in line with fear and loathing. SWAT teams routinely bust into citizens houses in the middle of the night and shoot the pets first. “Puppycide” has become a new word in the American vocabulary. And now the SCOTUS has formalized into law the idea that any order by the central government must be followed or you may be fined and loose everything. There is no longer any effective limit to the power of the central government.

We have reached the point were it is not “over the top” to say that the USA has become a very dangerous tyranny, a police state,  with more military power than the world has ever seen.

The report from here is bad, very bad. Bad for US citizens and bad for the whole world. Hysterical fear may be the most rational reaction at this point.

The left and the right

Some terms that mislead modern Americans are “left”, “right”, “liberal”, “conservative”, and “libertarian”. Add to those, “capitalism” and “socialism”. I hope to address the “left” and “right” issue in this post.

What is “left and right” in the political and economic sense? Karl Hess, agreeing with Murray Rothbard, argued:

“the overall characteristic of a right-wing regime … is that it reflects the concentration of power in the fewest practical hands.” This is the “dominant historic characteristic of what most people, in most times, have considered the political and economic right wing.”

Another way of saying that is that the “right” is allied with the Ancien Régime and all that it represents in its modern incarnations. In other words, “right wing” simply means authoritarianism.

Logic and semantics dictates that the “left”, being the opposite of right, represents the opposite tendency.

Karl Hess, in Dear America (1975) wrote:

The farthest left you can go, historically at any rate, is anarchism — the total opposition to any institutionalized power, a state of completely voluntary social organization in which people would establish their ways of life in small, consenting groups, and cooperate with others as they see fit.

The attitude on that farthest left toward law and order was summed up by an early French anarchist, Proudhon, who said that ‘order is the daughter of and not the mother of liberty.’ Let people be absolutely free, says this farthest of the far, far left (the left that Communism regularly denounces as too left; Lenin called it ‘infantile left’)….

Through a series of unfortunate but certainly understandable distortions of political terminology, the [modern] liberal position has come to be known as a left-wing position. Actually…. [l]iberals believe in concentrated power — in the hands of liberals, the supposedly educated and genteel elite. They believe in concentrating that power as heavily and effectively as possible. They believe in great size of enterprise, whether corporate or political, and have a great and profound disdain for the homely and the local.

The point to understand is that when one of these labels is being used, do not allow any particular preconceived stereotype of “left” or “right” to cloud one’s understanding of what is being said. To do so means that you will not understand where one’s natural political or philosophic allies are to be found and will also misunderstand the ideas being presented to you. The question to be asked when someone uses “left” or “right” is; are these labels being used in an authoritarian sense or an anti-authoritarian sense?

It is often debated between “leftists” and others (i.e. libertarians) whether the “real” meaning of a term like “capitalism” is the free market, government favoritism toward business, or an hybrid arrangement between the other two. Austrian Economists will use the the term to mean laissez-faire free-markets, but most others, especially the “left” but also the “right”, will use “government favoritism toward big business” since that is what they see all over the globe and it is mostly mislabelled as “capitalism”. It is, indeed, right-wing fascism. It is neo-mercantilism.

It may surprise many to learn that Murray Rothbard lauded the New Left’s most “crucial contribution to both ends and means” in its concept of “participatory democracy.” Rothbard writes:

In the broadest sense, the idea of “participatory democracy” is profoundly individualist and libertarian: for it means that each individual, even the poorest and the most humble, should have the right to full control over the decisions that affect his own life.

But then for Rothbard the free market is the fullest realization of participatory democracy possible with every human making their own decisions. Rothbard saw the free market, without any government to favour big business (those evil corporations), as the road to the greatest good for the most people.

Ludwig von Mises would agree also. He wrote:

In the capitalistic society, men become rich … by serving consumers in large numbers…. The capitalistic market economy is a democracy in which every penny constitutes a vote. The wealth of the successful businessman is the result of a consumer plebiscite. Wealth, once acquired, can be preserved only by those who keep on earning it anew by satisfying the wishes of consumers. The capitalistic social order, therefore, is an economic democracy in the strictest sense of the word. In the last analysis, all decisions are dependent on the will of the people as consumers.

What of the modern political wars between “the left” and “the right”? The real war is between libertarians and statists. There is the real left proposing the greatest freedom possible for all the masses and then there is the “modern liberal and conservative” alliance proposing ever more authoritarianism. I choose freedom and liberty over domination by the State. I am a leftist. I would sit on the side of the assembly with Proudhon.

Total Liberty

Tactics for libertarians in these days

I can not predict when socialism as a political and economic philosophy will end; I only know that it must end. Libertarians often talk about what will happen when the present system crashes and burns. No one knows really; we can only prepare by educating the masses on what laissez-faire free-markets mean. We can only educate them that there is no function that government can provide that private, voluntary cooperation will not provide much better.

We must teach that socialism employs unjust means like raw brutal force, theft, coercion and the denial of private property rights, in order attempt to achieve the impossible dream of ending permanently the natural differences among people. Murray Rothbard told us that egalitarianism was simply a Revolt Against Nature.

There is a looming economic crisis lying just ahead and the resultant social crisis may well be the death of the USA as we presently know it. This could be like the old joke of “my mother-in-law went over a cliff in my new sports car”. It could be good in the long run but horrible in the near term. Good libertarians stand in a position to expedite the present system’s death and perhaps drive a stake through the heart of the false philosophy of collectivism that has spiritually and economically impoverished the Western world for over a century.

We must seek to help our fellow citizens understand what socialism is, for our present system is socialism. Or it is fascism. Or it is collectivism. Let us not get hung up on labels. Socialism at its core is a system based on force, fraud, coercion and theft. Under threat of violence or imprisonment, socialists take citizen Bob’s property and give it to citizen Sam while keeping a large portion for its own use. The busy bodies also take control of your property at every turn down to telling you what you may eat. (no? just you wait)

Both “liberal” and “conservative” socialists/collectivists/fascists sometimes borrow each other’s methods and tactics. Both subcategories of the socialist ideology are based on utilitarian  reasoning. They think that the “ends justify the means”. If making everyone “the same” is the goal, then there is nothing that a “liberal” would not do to achieve this end. Although their methods may differ slightly, collectivists of all stripes must fundamentally upset the natural human order. They seek to cause the masses to believe that only the tax-funded state and not the family, friends, neighbors, church and other voluntary institutions can provide real comfort, safety, security and protection. Modern “conservatives” are every bit as controlling as modern “liberals”. There does not seem to be a war they don’t love; be it a foreign war or some “war on crime”.

Libertarians must educate themselves on the goals and tactics of the State and its all its minions, as well as educate themselves on the laissez-faire, voluntary cooperation that must replace it. Then comes the hard part; you must seek to convince your friends, family, acquaintances, and anyone who will listen to you. You must be prepared. You must read and understand the many objections to liberty and the answers to these objections.

Go, make a difference. Start today.

Mercantilism: Old and New

Dr. Gary North wrote:

Keynesianism is almost universally believed today. Therefore, mercantilism is almost universally believed. This connection is not intuitive, but it is nonetheless true. What the economics textbooks do not say, because they are written mostly by Keynesians, is that Keynesianism is mercantilism with equations.

The textbooks are officially anti-mercantilistic. There is a reason for this. Mercantilism is officially wrong, because it is undeniably old. Textbooks promote that which is new: “The latest is the greatest.” Mercantilism was believed from 1650 to 1750. It is therefore outmoded.

Yet it is in fact the dominant economic philosophy today. But it operates under cover. The cover is called “managed trade.” It is sometimes called “fair trade.” The high priests of mercantilism baptize the new convert in the name of free trade, but then they catechize him in terms of modified mercantilism. Modern mercantilism is “free trade with modifications for justice’s sake.” “Justice” is defined operationally as “protecting a politically favored voting bloc.”

Keynesianism is an economic philosophy based on the idea that the free market requires forceful intervention from the government in order to maintain justice and efficiency. The free market is both inefficient and unfair to the common man. This is also true of Mercantilism.

Wikipedia says:

Mercantilism is the economic doctrine in which government control of foreign trade is of paramount importance for ensuring the prosperity and military security of the state. In particular, it demands a positive balance of trade. Mercantilism dominated Western European economic policy and discourse from the 16th to late-18th centuries.^[1] Mercantilism was a cause of frequent European wars in that time and motivated colonial expansion. Mercantilist theory varied in sophistication from one writer to another and evolved over time. Favors for powerful interests were often defended with mercantilist reasoning.

Neo-Mercantilism seems to be the predominate economic theory of the present age. The USA has bases all over the world and controls, in many varied ways, the governments of countries globally. It is not only about the oil.

Original mercantilism was the widely held, incorrect theory of trade that insisted that a nation grows rich by exporting more than it imports. Britain had a huge navy and army to force other nations into a position whereby Britain could control trade between nations; thinking that by doing so they would become more wealthy.  Since a nation gets rich only if its residents get rich this idea was a major error. It was refuted by various famous economists, but as modern truth-telling by the Austrians shows; that rarely sways politicians.

Modern mercantilism in the West has changed the direction of the import/export idea. Now mercantilism says a nation grows rich by importing more than it exports. You go into debt to buy from foreign exporters and this “borrow to grow rich” idea seems to make sense to modern Western politicians. This is Western Keynesianism.

The Asians still believe in old style mercantilism so they lend to us to buy their products and we happily borrow from them to buy these products.

This modern mercantilism or Neo-mercantilism is called by another name: Keynesianism. No matter the name: the idea has been refuted by economists and by history time and again. Yet the USA still thinks outspending the rest of the world on the warfare machine will make us more wealthy. This is Lunacy.

The thing to remember is that “mercantilism” has been discredited and no one believes in that system anymore. The textbooks even say so. But mercantilism is just the old name for Keynesianism so Keynesian economic theory is bunk also. Remember that when you listen to politicians.