So what is the point of it all?

Why be libertarian, anyway? By this we mean, what’s the point of the whole thing? Why engage in a deep and lifelong commitment to the principle and the goal of individual liberty? For such a commitment, in our largely unfree world, means inevitably a radical disagreement with, and alienation from, the status quo, an alienation which equally inevitably imposes many sacrifices in money and prestige. When life is short and the moment of victory far in the future, why go through all this? ~ Murray Rothbard

What a great question Rothbard asked. Why fight for liberty at all? After all, given the shape of the world today it does not look like we are going to see liberty in our lifetime. I think that the answer to that is deeply personal. Some might fight for liberty for purely philosophic reasons, believing that to know the truth and tell it is a moral imperative. Others, perhaps, fight for liberty out of a religious perspective thinking that the god they worship demands it or that they need freedom to follow their religion. Still others just want to be left alone to seek maximum profit in the laissez-faire market. I am sure there are a host of other reasons that people have for wanting to fight for liberty and freedom that I am leaving out here.

For me, it has always been the social justice aspect of the issue. Or maybe I should say that it is just about “what is fair”. When we were very small children our mothers and our teachers taught us all about being fair to one another and not doing to others what we did not want them doing to us. Don’t like to get hit? Don’t do that to someone else! Rothbard said that some liberty lovers had a “passion for justice” and that was what made them libertarians, radical libertarians even. The justice part is a piece that confuses a lot of people. I interact with so-called liberals of the American variety who want government to level the playing field and spread misery equally among all the people. They would rather burn it all down than see a prosperous people if that prosperity meant that some folks would grow very, very wealthy while most would just be well off. The radical egalitarianism of the “modern American left” forces them to be against the laissez-faire market system that kicked off the industrial revolution and freed mankind from the drudgery of medieval life.

The age-old record of inequality seems to indicate that this variability and diversity is rooted in the biological nature of man. But it is precisely such a conclusion about biology and human nature that is the most galling of all possible irritants to our egalitarians. Even egalitarians would be hard put to deny the historical record, but their answer is that “culture” has been to blame; and since they obviously hold that culture is a pure act of the will, then the goal of changing the culture and inculcating society with equality seems to be attainable. In this area, the egalitarians slough off any pretense to scientific caution; they are scarcely content with acknowledging biology and culture as mutually interacting influences. Biology must be read out of court quickly and totally. ~Murray N. Rothbard

If only we can find a way to explain to the modern egalitarians that record of the old USSR provides us with plenty of data that tells us that leveling society into utter misery and poverty is not very welcome to the masses, then perhaps we can win them over to our views. We all want a “good life” even if by having the freedom to struggle for a “good life” we see others do far better than ourselves. We must fight off the odious sin of envy and seek to cooperate with others without any violence, force, intimidation, or aggression being involved. We must seek market anarchy in other words.

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I find that those with a passion for justice will have to reject the State and all its works. We have to reject the state totally and absolutely. To abolish this font of evil we must show as many as we can that the state is a parasite feeding off of good people and destroying lives and ruining families across the world. Once upon a time people said you could not end slavery since the slaves would not know how to take care of themselves. Looking back from modern times we can see how stupid that idea was, but many voiced that opinion in this country once upon a time. It is the same with government by the nation-state: it has enslaved us and yet many say we can not live without a state to rule us. Rule us? It dominates and brutalizes us.

“The storm center of lawlessness in every American State is the State Capitol. It is there that the worst crimes are committed; it is there that lawbreaking attains to the estate and dignity of a learned profession; it is there that contempt for the laws is engendered, fostered, and spread broadcast.” ~H.L. Mencken

And of course the central government in D.C. makes the state governments look like amateurs.

There are two ways that you can earn your living and there aways has been. One can live by being a predator and stealing from others as all state employees do; or one can live as a producer and provide some of the wants and needs of his fellow man. The radical libertarian is an abolitionist who fights the predators and wants to end the state today. We will take whatever small victories we can along the way, but our only real goal is ending the vicious state. We don’t think in 5 year plans like the communists of the old USSR, nor do we think of gradually getting a little better by reducing some atrocious state program by 3 percent. A radical regards the State as our mortal enemy, which must be hacked away root an branch wherever and whenever we can.

I am a libertarian because I see the state as the evil enemy of mankind. I am a radical because you can not accept a gradualist approach with evil; you must fight it with whatever you can.

Our allies the Classical Liberals

There are many things that advocates of laissez-fair capitalism have in common with advocates of market anarchy. Usually the Classical Liberals or “minarchists” advocate laissez-faire markets within a structure of the “night watchman state” while market anarchists advocate the elimination of the state entirely. The difference between the two concepts mainly depends on whether you believe the market could supply legal and protection services or not. The minarchists believe that some state is needed to administer the law.

As we fight the present massive, oppressive, and invasive state, all of us who support liberty will need to seek out allies and support others who are working to eliminate the present tyranny. This is a “big tent” approach as it is called in some political circles. After all, most Rothbardian anarcho-capitalists that I know started out believing in a “normal sized government” and then saw that the State must be kept small as possible: and only then did they make the transition to the belief that there is no role for the State at all in human affairs. They were Classical Liberals at some point in other words. So we need to recognize that many we talk to about liberty and freedom might not be ready move all the way to anarchy.

“It is the invariable habit of bureaucracies, at all times and everywhere, to assume…that every citizen is a criminal.  Their one apparent purpose, pursued with a relentless and furious diligence, is to convert the assumption into a fact.  They hunt endlessly for proofs, and, when proofs are lacking, for mere suspicions.” ~H.L. Mencken

Market anarchism and minarchist laissez-faire capitalism are both radically individualist in their nature. The Welfare/Warfare State is the opposite of the views of both anarchists and minarchists, and both camps can agree that the US Empire needs to be tossed on the trash heap of history. Both camps describe the way that society should deal with shortages or scarcity of goods that we want and need mostly in terms of Austrian economics. Both advocates of laissez-faire capitalism and advocates of  “market anarchism” are advocates of individual liberty and mutual consent and cooperation in every aspect of social life. Both camps reject almost all forms of domination by government as a violation of the non-aggression principle, with market anarchists rejecting all domination by the state. The possibilities inherent in free market relationships freed from government and crony-capitalist privilege demand that one see any intervention of any sort into the market as a violent intrusion.

The advocates of a really free market, regardless if they see a role for a small government or not, have several common beliefs and the following is a list I once saw posted on the the policies advocated by all those believing in a really free market. Some even call it a freed-market to distinguish our concept of laissez-faire from the situation in the country today that is crony-capitalism or corporatism.

What beliefs are a basis for voluntary cooperation? One list I have seen says:

  1. Private ownership of property; not only of personal possessions but also of land, homes, natural resources, tools, and capital goods;
  2. Contracts and voluntary exchange of goods and services, by individuals or groups, on the expectation of mutual benefit;
  3. Totally free competition among all buyers and sellers — in price, quality, and all other aspects of exchange — without ex ante restraints or burdensome barriers to entry;
  4. Entrepreneurial discovery, undertaken not only to compete in existing markets but also in order to discover and develop new opportunities for economic or social benefit; and
  5. Spontaneous order, recognized as a significant and positive coordinating force — in which decentralized negotiations, exchanges, and entrepreneurship converge to produce large-scale coordination without, or beyond the capacity of, any deliberate plans or explicit common blueprints for social or economic development.

The above list is essentially the Classical Liberal vision of laissez-fair capitalism. As Dugald Steward explained; “Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and the tolerable administration of justice; all the rest being brought about by the natural course of things.”

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I disagree with the Classical Liberals in that I believe that there must be no state at all since even the smallest one will grow in power and scope until it dominates the people. I also find that I am an enemy of the state who “hates the state” as Murray Rothbard once put it. Even so, I would much rather see a minimal state like the one at the beginning of the USA over the brutal, controlling monster that we see today. I have differences with the Classical Liberals, but we have a lot in common. Let us fight the present state together.

Our rights and our property

Some of my friends got off onto a property rights argument yet again in a back and forth on Twitter. The exchange reminded me that when you get to the heart of most arguments you will find a misunderstanding of property rights, a misunderstanding of basic economics, or both. And so, I decided to write a brief look at my take on property rights and then a look at a friend’s distinction between “private property” and “personal property”.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. ~Thomas Jefferson in the Declaration of independence

In America among the so-called “Liberals” of the modern era we find those who are constantly finding “human rights” to justify whatever their latest goals and schemes happen to be at the time and yet they attack the individual’s property rights every chance they get. These “human” rights of the so-called American Left are all warm and fuzzy and are without the clarity needed to be principles. The liberals are ready to toss a “human right” under the bus when it is pragmatic to do so. They don’t seem to have any bed rock principles to guide them other than they think they know what is best for the rest of us.

I have long been convinced that all “human rights” are property rights. When the argument drifts away from property rights then the “rights” become vague and they vacillate with changing fads and circumstances. Without the principle of the individual’s property rights, often it becomes just a government dictate as to what “rights” one has and that situation is not rights at all but government granted privilege.

Murray Rothbard wrote:

Take, for example, the “human right” of free speech. Freedom of speech is supposed to mean the right of everyone to say whatever he likes. But the neglected question is: Where? Where does a man have this right? He certainly does not have it on property on which he is trespassing. In short, he has this right only either on his own property or on the property of someone who has agreed, as a gift or in a rental contract, to allow him on the premises. In fact, then, there is no such thing as a separate “right to free speech”; there is only a man’s property right: the right to do as he wills with his own or to make voluntary agreements with other property owners.  ~ Power and Market, 2nd ed. (Kansas City: Sheed Andrews and McMeel, 1977), pp. 238-39.

Free speech is in the news again as well as the right of a “free press”,  and there have even been calls to have Glenn Greenwald, The Guardian Newspaper, and other journalists prosecuted for publishing materials supplied by the whistle blower Edward Snowden. I intend to write about the Snowden episode another day but that news led me to think of “freedom of the press” and of “free speech” in conjunction with private property today.

It has been said that “the right to freedom of speech” is just the right to hire a venue (or start a blog) to express your views on various matters. I can say anything I want to while I am in my house (if the wife lets me of course!) and I can write what I want to here (freedom of the press) at this blog as long as I don’t violate the agreement with wordpress or verbally aggress against someone in my writings.  Free speech and free press rights are almost the same thing, especially in these modern high tech times. Both are just subsets of private property rights. I can enter into agreements with others to express my views in a variety of ways — but I have to respect the property rights of others at the same time.

Sometimes people get all hung up on common words. Most people define “private property” simply as property held by non-governmental legal entities. Or in other words, the property that the State does not claim is said to be “private” property. And “personal property” has historically just meant private property that is movable as opposed to land that you can not move. As Rothbard did, I take “property rights” to mean those rights in our private property to include all property owned by the individual no matter if he can move the property about or not. Why make such a distinction? After all, what usually divides people on “property rights” is land.

Land is often the sticking point with many people because the easiest way to control a man is to control the land beneath his feet. If you keep the masses from owning land, then you have gained control of the masses to a great degree. That is one of the reasons that the criminal State would often make huge land grants to its favored co-conspirators. In a libertarian world, there would be a lot of “owners” of large tracks of land that would not be able to defend their deed to that land, but that is for the common law courts to decide after society sheds the evil of the state — and a topic for another day.

“To take from one because it is thought that his own industry and that of his father’s has acquired too much, in order to spare to others, who, or whose fathers have not exercised equal industry and skill, is to violate arbitrarily the first principle of association–‘the guarantee to every one of a free exercise of his industry and the fruits acquired by it.'”  ~Thomas Jefferson: Note in Destutt de Tracy’s “Political Economy,” 1816.

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Self-Ownership, where do you stand?

Over the years, most people that I have talked to in real life have always been the sort of people that believed individuals own their own bodies, even if they don’t know exactly what all the implications of that belief might be. This instinctual feeling seems to be an inborn belief with many (most?) humans that is stamped on our very soul at birth. If one stops and thinks if over, he will see that we can, like Murray Rothbard, start with the single proposition, that we all own ourselves, and expanded that insight into a full blown political philosophy. We can began with “slavery is always wrong” which is just another way of stating that we own ourselves and end up with full blown libertarianism. There are those that disagree of course, there always are.

While most would grant self-ownership as a self-evident axiom, I once read a post by Daniel Krawisz where he argued that “self ownership” was not a moral absolute as far as he was concerned:

Among libertarians, self-ownership is generally held to be a moral absolute. Under this view, it is not permitted ever that one person may be owned by someone else, even if he should attempt to sell his body voluntarily. The nonaggression principle and the self-ownership principle may be seen as equivalent or one may be seen as a consequence of another. However, none of these is correct; while the principle of nonaggression is a priori, the principle of self-ownership is not, and it is therefore impossible that there could be a logical relationship between them.

I fail to see how he got so quickly from self-ownership to one can not sell himself if he wanted to under libertarian philosophy without so much as a paragraph of discussion, but there you have it. I once read that people would sell their future labor for a certain period of time for the price of passage from Britain to the ‘new world’. There is an example of men “selling their body” is it not?  Anyway, he goes on to assert that “self-ownership” can not be a universal principle since there might be space aliens who have more than one body, or more than one mind. I figure a guy has lost it when an appeal to weird space aliens is need to make a point.

The concept of a body is only an interpretation we make of a particular configuration of matter which a person feels more directly in control of than other things, and while this interpretation ordinarily makes sense for humans, for other imaginable beings it may not.

On the other hand, most libertarian writers I have read agree that self-ownership is a basic axiom of our philosophy. Michael Rozeff writes:

Libertarianism builds upon the self-ownership axiom. But why is self-ownership right (and just)? How do we justify the self-ownership axiom?

Rothbard stated the self-ownership axiom in this way: “…the basic axiom of libertarian political theory holds that every man is a self-owner, having absolute jurisdiction over his own body. In effect, this means that no one else may justly invade, or aggress against, another’s person.”

Block states the non-aggression axiom as follows: “It is illicit to initiate or threaten invasive violence against a man or his legitimately owned property.” More loosely, Thomas Jefferson argued that all men by their nature have the rights to life, liberty, and the pursuit of happiness.

These several wordings amount to the same thing. To have self-ownership is to be able to make one’s own choices in all spheres of one’s life. Self-ownership amounts to an undiluted right to one’s life and the liberty to pursue one’s happiness. If one has complete self-ownership, then one is not being aggressed upon. And if one (or one’s property) is not being aggressed upon, then one is free to pursue one’s own interests and one owns oneself. Therefore, as Rothbard says, the non-aggression axiom is equivalent to the self-ownership axiom.

The economic content of (full) self-ownership for every person is that an individual may make any desired choices as long as he does not initiate or threaten violence against another person or his legitimately held property.

A good deal of philosophical discovery comes from understanding the economic laws that the Austrian School of economics has shown us. The Austrian methods include a priori knowledge, deduction from basic axioms like a Geometry proof, and understanding of human nature and its subjective valuation of situations. The Austrian School has informed us that society will be much more wealthy and contented if it allows each individual to do as the individual thinks best for himself, as long as that individual does not aggress against anyone else. That is the economic argument, but the moral argument has always tended to say more to me than the economic one. I am not saying the economic argument is not important as it surely is, but just that my soul tends to listen to the moral argument.

Murray Rothbard once asked if a man does not own himself, just who does? Would anyone argue for a man X owning a man Y simply by force or intimidation? Would anyone argue for slavery? Of course not. But if a man does not own himself and some other man does not, then the only possibility left is that the collective owns us all. We all own each other to the same degree. My, oh my, but that is an interesting possibility. That means I need to get 100 percent agreement on each action I take. Wait, I can’t get agreement because I would need prior agreement to just go ask for agreement! Oh hell, my head hurts now.

There is no way to have 100 per cent co-ownership. There is no moral argument at all for ownership of humans by other humans — slavery is a horror. There is only self-ownership as a realistic ethical possibility. We would all recognize that except that admitting that position leads to the full corpus of libertarian thought and some people just can’t go there.

For example, if each man is a self-owner then no one may take any of his property or make demands on his time or labor without the free-will agreement of the individual. Hence, taxation is simply immoral and wrong. And please, don’t hand me that old saw about taxes being part of some “social contract” that was forced upon us all at birth — that is just another way of saying the collective owns me.

There is no way to justify the state’s claim to a monopoly on the legal system either. A free self-owning man should not be forced to use the state’s system but rather pick and choose from competing legal services systems. In fact, if you get down to the matter we may have a State or we may have self ownership but we can’t have both. The reason is the state asserts that it ultimately owns you, or at least part of you. Hence you can’t own yourself 100 percent if the State owns a portion.

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Where do you stand? Will you seek self-ownership and be an enemy of the state? Or will you acquiesce and concede a portion of your soul to the state? I concluded long ago that the state is illegitimate.

The moment one realizes that the State itself is illegitimate he then is obligated to consider how society should be constituted. The fact is that without the monopoly coercion of the state society would find its own path as millions upon millions of people interact with each other to the benefit of all. That my friends, odd as it sounds, scares some people. They want guarantees on how it would all work out. Some seem to think that staying in the arms of the tyrannical state beats hell out of the unknown. How do we get like that? How can we not say that even the unknown beats hell out of the state? The state that killed over 200 million people in the 20th century alone and is simply a gang of thieves writ large is obviously the enemy of mankind and needs to be tossed on the garbage heap of history.

Don’t you think it is time to reject the legitimacy of the state? Past time really.

Anarchy, Miniarchy, Panarchy, Society, and the Individual

On a day that I was far too busy to join in very much, several Twitter friends were discussing the differences between anarchy and miniarchy. One comment led me to cite a Mike Rozeff essay on Panarchy. That led to even more discussion. I noticed along the way that the definition of a few terms kept getting in the way. There were those who felt their definition of a given term was set in stone and handed down to Moses on the mountain top. When discussing things it is always good when people have the same definition of various terms, but you can not depend on that happening so we all need to make sure we define our terms so that others can tell what we really mean by our statements.

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We all know that “anarchy” simply means the absence of a “State” and not the “chaos” that the statists like to conflate with the term. We anarchists, especially market anarchists, believe that a well ordered society will arise by itself without any ruling body using force, intimidation, or coercion. Hence, we reject the “State”. But what is this “State” that we reject?

Murray Rothbard once defined the State as:

… Let me say from the beginning that I define the state as that institution which possesses one or both (almost always both) of the following properties: (1) it acquires its income by the physical coercion known as “taxation”; and (2) it asserts and usually obtains a coerced monopoly of the provision of defense service (police and courts) over a given territorial area. An institution not possessing either of these properties is not and cannot be, in accordance with my definition, a state.

He then went on to explain why, under that working definition of “The State”, he had to reject the State no matter if it were large or small:

On the other hand, I define anarchist society as one where there is no legal possibility for coercive aggression against the person or property of an individual. Anarchists oppose the state because it has its very being in such aggression, namely, the expropriation of private property through taxation, the coercive exclusion of other providers of defense service from its territory, and all of the other depredations and coercions that are built upon these twin foci of invasions of individual rights.

These ideas as outlined by Rothbard are exactly why I reject the very idea of “The State“. Our miniarchy friends think that there are reasons to trade “some” liberty to a “small” State in order to receive “law and order” or to be protected from invasion by outsiders. This is a bargain with the devil that has always, in all places, yielded a strong, domineering State. The individual is always swallowed up in the collective any time we institute the State.

However, there is the idea out there that “The State” is not the same concept as “a government” even though the two terms have been conflated for centuries by statists to mean exactly the same thing. I can certainly understand how a state worshiper would want to tell us that without the State there is no way to govern society and hence chaos would ensue. But what is “to govern” really? One definition of “to govern” means “to exercise a directing or restraining influence over” as in “the motives governing a decision.” It was in using the term “government” as opposed to “The State” that led to much back and forth in the Twitter discussion. I often use ‘government’ as a synonym of ‘The State’ but in reality one can have a volunteer government in a social club or so forth without coming close to Rothbard’s definition of the State. So we must be careful and not reject people’s ideas if they use “government” or even “socialism” in ways that differ from our own conceptions. I’ll try to do that in this post.

How are the rights of the individual to be protected in society? I have read some people who claim that the individual has no inherent rights at all and that only the collective can confer any ‘rights’. One “progressive” insisted that only the majority could offer “rights” to individuals! That is granting privileges and not rights. If you don’t think there are any human rights to protect then I would advice you stop reading here as we can not communicate. But if you do see that man has ‘rights’ then the question is: “how do we protect these rights?” How can men and women order a society in which the individual is protected?

One idea to protect the rights of all is to do away with the state and let individual people form voluntary associations with each other to interact in voluntary ways. We often just say that this is the laissez-faire free-market in action. People will institute rules, traditions, precedents, taboos, and other ways of ordering society if they but have a chance to do so. In an ironic way this was the idea behind “Democracy”, except that Democracy always ends up being the tyranny of the majority and leads to what you see in the USA as I write this. Real democracy is when the individual “votes” with her purchases in the free market.

The philosophy of voluntarism has been covered many times and in many places, so I’ll skip talking about how different groups of people would specifically order their affairs given the freedom to do so, except to say that we don’t really know how they would do it. In the absence of the Modern Nation-State we would see many different experiments in social ordering. And that, my friends, brings me to the idea of Panarchy.

Panarchy has been defined as:

“PANARCHY: The realization of as many different and autonomous communities as are wanted by volunteers for themselves, all non-territorially coexisting, side by side and intermingled, as their members are, in the same territory or even world-wide and yet separated from each other by personal laws, administrations and jurisdiction, as different churches are or ought to be.”

Under this definition of Panarchy we see that choosing a “governing body” would be just like choosing friends on Twitter or in real life. In the same way we choose to join, or not join, a club or church we could chose to join a given “government”. Because of my habit of using “government” to mean “the State” I would like to come up with a different word other than “government” but the best I could come up with on short notice was “regimen” and that strikes my ears oddly. Perhaps a Túath would be better suited for our purposes since that is what the anarchist Irish called their voluntary governing associations for centuries.

So, if there were many “governments” (Túaths) all of which were voluntary associations that had no right or power to force people to be their members I could pick and choose at my will. This would lead to a free market situation where these associations might survive or might not. Let us be clear here, the idea of Panarchy depends on the understanding that members may be from anyplace and they join just like I pick a cell-phone company. They may also leave the association at any time subject to the contract that one makes with the group. (early exit surcharges?)

If you can see that one ought to be able to join any governing association that one wants to, or not join, then you can see that all of today’s States and Governments are not legitimate. There is no way for me to reject the US Government and choose some Rothbardian association to be my “government” and my “nation” — or to join no group at all. Hence the USA stole my right to do so at my very birth. In this matter we see yet again that the State as defined by Rothbard is illegitimate.

In certain ways we can see that the governments of today are the operation arms of the various States. These governments take on differing forms but all deny the people the right to join any other governing body that they freely choose to unless the person flees the territory of the first state and moves to another. Some have said this is like waking up one morning to find that you have been made a member of the “Church of the USA” against your will and you can not leave the Church unless you leave the country.

In a Panarchy one could choose to join with any group of people and their governing association or to choose not to join any of them. Since the exact location where you live is immaterial to this choice there would be many, many “governments” to choose from and competitive market forces would arise to control them. Because people could exit or enter any governing association freely there would be a strong system of checks and balances provided by the market itself as people made free-will, voluntary decisions about which outfit to be a member of.

So far, I tend to view “Panarchy” pretty much as I do my concept of market anarchy itself. It is very Rothbardian to agree that all people have the right to form whatever voluntary associations that they choose to. Many have written that there would arise private business concerns that would offer legal and protection services to people in any modern  anarchy. In many respects, the “governing associations” of Panarchy and the protection services businesses of market anarchy are not so very different other than in name.

Panarchy does have the semantic advantage of offering people “many governments and not just one!” I have talked with people who know that the US Empire is evil and taking away all their rights but they believe there must be government. So, I can tell them that if government is so great, there should be lots of them competing for the allegiance of the people. That seems to me to be a nice introduction to anarchy in certain cases.

Panarchy is an interesting idea.

Progressives, Cartelists, the FED, and trust busting

Murray Rothbard wrote about the vastly wealthy in America fooling the progressives and then re-writing history as to what happened in a small article in 1999. Here is a short portion of that article:

The Federal Reserve Act of December 23, 1913, was part and parcel of the wave of Progressive legislation on local, state, and federal levels of government that began about 1900. Progressivism was a bipartisan movement that, in the course of the first two decades of the 20th century, transformed the American economy and society from one of roughly laissez-faire to one of centralized statism.

Until the 1960s, historians had established the myth that Progressivism was a virtual uprising of workers and farmers who, guided by a new generation of altruistic experts and intellectuals, surmounted fierce big business opposition in order to curb, regulate, and control what had been a system of accelerating monopoly in the late 19th century. A generation of research and scholarship, however, has now exploded that myth for all parts of the American polity, and it has become all too clear that the truth is the reverse of this well-worn fable.

In contrast, what actually happened was that business became increasingly competitive during the late 19th century, and that various big-business interests, led by the powerful financial house of J. P. Morgan and Company, tried desperately to establish successful cartels on the free market. The first wave of such cartels was in the first large-scale business — railroads. In every case, the attempt to increase profits — by cutting sales with a quota system — and thereby to raise prices or rates, collapsed quickly from internal competition within the cartel and from external competition by new competitors eager to undercut the cartel.

During the 1890s, in the new field of large-scale industrial corporations, big-business interests tried to establish high prices and reduced production via mergers, and again, in every case, the merger collapsed from the winds of new competition. In both sets of cartel attempts, J. P. Morgan and Company had taken the lead, and in both sets of cases, the market, hampered though it was by high protective, tariff walls, managed to nullify these attempts at voluntary cartelization.

It then became clear to these big-business interests that the only way to establish a cartelized economy, an economy that would ensure their continued economic dominance and high profits, would be to use the powers of government to establish and maintain cartels by coercion, in other words, to transform the economy from roughly laissez-faire to centralized, coordinated statism. But how could the American people, steeped in a long tradition of fierce opposition to government-imposed monopoly, go along with this program? How could the public’s consent to the New Order be engineered?

Fortunately for the cartelists, a solution to this vexing problem lay at hand. Monopoly could be put over in the name of opposition to monopoly! In that way, using the rhetoric beloved by Americans, the form of the political economy could be maintained, while the content could be totally reversed.

Monopoly had always been defined, in the popular parlance and among economists, as “grants of exclusive privilege” by the government. It was now simply redefined as “big business” or business competitive practices, such as price-cutting, so that regulatory commissions, from the Interstate Commerce Commission (ICC) to the Federal Trade Commission (FTC) to state insurance commissions, were lobbied for and staffed with big-business men from the regulated industry, all done in the name of curbing “big-business monopoly” on the free market.

In that way, the regulatory commissions could subsidize, restrict, and cartelize in the name of “opposing monopoly,” as well as promoting the general welfare and national security. Once again, it was railroad monopoly that paved the way.

For this intellectual shell game, the cartelists needed the support of the nation’s intellectuals, the class of professional opinion molders in society. The Morgans needed a smokescreen of ideology, setting forth the rationale and the apologetics for the New Order. Again, fortunately for them, the intellectuals were ready and eager for the new alliance.

The enormous growth of intellectuals, academics, social scientists, technocrats, engineers, social workers, physicians, and occupational “guilds” of all types in the late 19th century led most of these groups to organize for a far greater share of the pie than they could possibly achieve on the free market. These intellectuals needed the State to license, restrict, and cartelize their occupations, so as to raise the incomes for the fortunate people already in these fields.

In return for their serving as apologists for the new statism, the State was prepared to offer not only cartelized occupations, but also ever-increasing and cushier jobs in the bureaucracy to plan and propagandize for the newly statized society. And the intellectuals were ready for it, having learned in graduate schools in Germany the glories of statism and organicist socialism, of a harmonious “middle way” between dog-eat-dog laissez-faire on the one hand and proletarian Marxism on the other. Big government, staffed by intellectuals and technocrats, steered by big business, and aided by unions organizing a subservient labor force, would impose a cooperative commonwealth for the alleged benefit of all.

And that transformation of a “roughly laissez-faire economy and society” to one of “centralized statism” came just in time to begin over a century of war and empire expansion that continues until this day. We have seen how the government can use the central bank to inflate money and pay for things they could never get with just taxes or borrowing (as bad as these two are). The main point of that Rothbard post is the idea that the progressives brought you the wonders of central banking which funds endless war and control by the rich.

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Steven Horwitz Professor of Economics at St. Lawrence University tells us:

Like other legislation of that era, the Fed was a government intervention supported both by ideologically-motivated and well-meaning reformers and by the industry being regulated. Rather than being this as some sort of unique conspiracy to take control of the US monetary system, it was a story very similar to those found in the history of everything from railroad regulation, to meatpacking regulation, to the regulation of monopolies and trusts as historians from Gabriel Kolko onward have documented. Unique historical factors in the monetary system affected the particular form the Fed took, but its broad history places it squarely in the tradition of the Progressive Era. If the Fed is the product of some nefarious conspiracy, so is a whole bunch of other legislation passed around that time.

The Fed emerged not as a response to failures of a free market in banking, nor as the result of shadowy banking conspiracies, but instead as a response to the failures of the National Banking System (1863-1913) that preceded it. The US banking system has never been a free market, as the National Banking System (NBS) was itself a response to pre-existing state-level regulations on banking. Under the NBS, and many of the state systems that came before it, banks were subject to three major regulations: 1) limits on the ability of banks to operate branches; 2) minimum reserve requirements; and 3) requirements that banks that produced currency buy up certain bonds or other financial assets as collateral.

The first and third of these regulations were particularly problematic. The limits on branching varied. During the pre-Civil War years, branch banks of any kind were illegal – banks could only operate one office. During the NBS, interstate branching was illegal, as no state would allow branches of banks chartered in other states to open up in that state, and some states still prohibited banks from opening branch offices within their state. The result was a banking system with few inter-bank institutions and too many banks that were too small and not sufficiently diversified, and therefore overly prone to failure.

The bond collateral requirements were also a problem. Before the Civil War, they often served as a form of crony capitalism as some states required that banks buy the bonds of railroads and other nominally private enterprises instead of, or in addition to, government bonds to serve as collateral. In the NBS, federally chartered banks were required to buy federal government bonds as a way of financing the Civil War. Regardless of whose bonds were required, forcing banks to purchase bonds when they want to expand their issues of currency became a problem as the required bonds were sometimes found to be either worthless or in short supply. One result was periodic currency panics that continued throughout the century.

In this episode of twisted fate, we see the progressives built the very edifice that they would then spend more than a century decrying. Now that is irony. They were had by a shell game played by the most wealthy class in America and they lost even as everyone celebrated their apparent victory. The central factor that the progressives failed to understand is that the monopoly is a product of government privilege and does not arise via laissez-faire free market forces. The “leaders of industry” got tired of so many newcomers competing successfully with them and their business concerns and so looked to government to protect them.

Friedrich von Hayek won the Nobel Prize for his theory of the business cycle and that theory puts the blame for the boom-bust business cycle squarely on the shoulders of the government and its controlled banking system. When government encourages bank credit expansion through its central bank and control of the banking system, this causes price inflation as well as increasing malinvestments. Most importantly this credit expansion encourages unsound investments in capital goods and underproduction of consumer goods. In spite of this knowledge, most Americans still believe that the monopoly control of their money by government is somehow a “good thing”. The progressives were fooled into giving the government the means whereby they could finance a world wide empire as well as dominate the domestic economy to everyone’s disadvantage.

It was the same thing with the idea that the government needed to be in the “trust busting” business. This hoary old canard hangs on till this day and you will hear it anytime you talk to a progressive or even most public school educated Americans. They really think that without their protector government the corporations would grow without bound until only a few, or even just one, dominated the whole world. They simply don’t understand competition nor have they read the history of the USA in the 1800s and 1900s. If they did understand, they would realize that it is government itself that helps the largest corporations to grow and dominate us. (crony-capitalism)

Big-business interests did try in the late 1800s to establish predatory high prices and reduced production and failed to do so. They tried the mergers that modern liberals tell us would lead to their total control of the people without government to stop them; and yet, they tried and the large business interests all failed due to market forces.  In every case the merger collapsed due to competition just as Hayek, Rothbard, and Mises have demonstrate must happen. Even hampered by the intervention of government through protective tariffs the market nullified these attempts by private concerns to create monopoly. And so the state was called upon to do by force, coercion, and intimidation what the big business moguls could not do by themselves.

The American big business leaders knew well that governments can hand out monopolies. The knew about the English monopolies in the period just before the industrial revolution. As Rothbard has pointed out; the creation of monopolies reached its climax in the reign of Queen Elizabeth. He quoted the words of historian Professor S.T. Bindoff, “… the restrictive principle had, like some giant squid, fastened its embracing tentacles round many branches of domestic trade and manufacture,” and “in the last decade of Elizabeth’s reign scarcely an article in common use – coal, soap, starch, iron, leather, books, wine, fruit – was unaffected by patents of monopoly.”

In the 1900s, as in America today, we have seen that lobbyists use the lure of monetary gain to obtain government sponsors to fight for their petitions for grants of monopoly. The American businessmen knew that using the law to secure their place was far easier and safer than competition! And once granted their privileges the monopolists proceed to loot the public just like Ma Bell of old. Now don’t be fooled, today’s grants of monopoly are crafted to make it look like they are promoting competition even as they do the exact opposite. There are many “barriers to entry” into an industry and mountains of expensive regulations that hold down new competition and allow the businesses protected to whine about “government regulation” even as those very regulations protect them. The propaganda of the government, lobbyists, and big business is far more sophisticated than is was in the 1900s and the manipulators are still fooling the common man — especially the “progressives”.

Ironic evil is the evil good men do while they think they are doing good. Many well meaning but economically ignorant men and women have helped get the USA to this sad juncture in its history. I hope more people will study Austrian Economics and arm themselves with the knowledge of how the world really works. Ron Paul has tried his best to explain economics to the masses and has done a great job of it; but all of us need to study more and to tell our friends and family.

I did not give any Political Consent to the DC Criminals

Every so often some modern “liberal” claims that I have given my consent to be ruled by the criminal gang writ large called the US Government. I tell you friends, I have most certainly not given my consent to be ruled by those thugs on the Potomac. “But you agreed to the social contract” they yell. No. No I did not. I never signed any “Social Contract“. Hell, I have not even seen such a contract to sign! Such talk of a “social contract” is utter nonsense and propaganda.

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These propagandists have to be talking about implied consent  to this “social contract” since we know that the Constitution which is our basic contract in the US was signed by just a few men (no women) and every one of those people are long dead. It is now over two centuries later and even the grandchildren of these men are all dead.

Did I give any implied consent when I voted a few times? No. I never got to vote on the legitimacy of the regime. And besides that, if you refuse to vote the regime does not then allow you to opt out and pay no taxes or ignore the government’s laws and rules. Try not voting and then smoking dope on a downtown street if you don’t see my point. There is no way to give “consent” if there is no avenue by which one may withdraw his consent or to never give it in the first place.

There are some folks who claim that I agreed to the social contract and the constitution simply because I was born inside the geographical boundaries claimed by the criminal gang in DC. In my youth this sort of argument was seen in the “America, love it or leave it” bumper stickers. This sort of hogwash claims that the government owns me because I was born! No way my friends, no way.

Then there are those who claim because I have generally obeyed the laws and not started a revolution that I am agreeing to the social contract. Nonsense on stilts! The regime puts a gun to my head and I obey to keep from getting shot and you call this agreeing to a contract? No contract law class in the world would call that arrangement an honest and fair contract. There are many laws passed by the criminal legislatures of this land that I obey because the police state would aggress against me if I did not; but that by no means says that I see these laws as legitimate. Hell, even tyrannical, oppressive regimes have the passive acceptance of their people given that they are not in open, armed revolt.

The most common claim that I have agreed to a social contract comes from the modern “liberals” who will say that if I use the government roads or the state’s legal system then I have agreed to be ruled by the criminal gang. But there can be no consent on my part as I have no way to opt out of this arrangement. The state steals more than half the paycheck of the common American and then spends it as the state pleases. If we use the roads we are force to pay for, this is not a voluntary, consensual arrangement. This is being raped and told to like it.

I have heard the modern “liberals” claim that you are a horrible person if you shop at Walmart. These same people support the government’s road system that allows Walmart to compete against the local businesses in every town in America and they support taxing the working man to the point he has to shop there where he can get the most for his money. And yet it is supposed to be the working man’s fault that Walmart is successful. Typical. The problem with most “liberals” is they voice loud and vociferous opinions on things they refuse to study.

“It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.” ~Murray Rothbard

No living person ever gave consent to the current regime in any meaningful way since there is no way to not obey. There in no meaningful choice in the matter. The government is violating our natural rights in an open and blatant manner and none of us is safe from it as long as it is allowed to exist. You have no moral obligation to support the state and I would argue that you have a moral obligation to oppose the state at every turn. Withdrawing your moral support for the regime is critical since public support is the basis of every regime’s power over the ruled. To just resignedly cooperate is to support the bastards. To be fair, it is not just the modern “liberals” or “progressives” who make this claim of “social contract” as the basis for supporting the state. Conservatives do likewise.

The reason that government schools are so crucial to the maintenance of the regime’s power is so that the state can propagandize the citizen from childhood up through young adulthood. The “public school system” is the regime’s most elaborate and effective propaganda operation but it is not the only one. It is one of many.

After all the years of government propaganda called “school” and then living in a society where the mainstream media is a propaganda arm of the regime, it is a wonder we can think at all. (h/t Paul Simon) The candidacy of Ron Paul did a lot to help millions of Americans wake from their slumbers and realize they have been lied to by the state. Our job is to keep that information flowing and help the citizens understand why they need to withdraw their consent to be governed  by this outlaw regime.