JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon used his annual letter to shareholders to provide his outlook on a post-Brexit world, internal changes the company must adjust to, and give his thoughts on what is wrong in an otherwise amazing United States.
Dimon, leader of world’s most valuable bank and a counselor to the new president, used his 45-page annual letter to shareholders on Tuesday to list ways America is stronger than ever -- before jumping into a much longer list of self-inflicted problems that he said was “upsetting” to write.
While I disagree with the notion that we MUST become more internationally collectivist, Dimon points out a lot of agreeable problems. Many of these are common sense to the rest of us, but are mostly ignored by the political class:
- Skyrocketing corporate taxes drive human capital and jobs overseas
-Regulation is excessive in almost every industry
-United States has wasted trillions in useless wars and requires a foreign policy overhaul
-Failed immigration policy which fails to retain numerous much-needed advance degree holders
-A Justice system that criminalizes American citizens with felonies, many times for only minor infractions
-A housing market weighted down by bureaucratic layers and rules
Finally, Dimon points out something that I'm very passionate about. Educating the populace. The Democratic, left-leaning populace, left to its own devices in 2016 overwhelmingly wanted a socialist to be their candidate at the same time that Venezuela burned. Dimon points out that people are losing their confidence in a system that has brought so many out of poverty. The free market is responsible for the most wealth created than any other system yet known to man.
The U.S. is paying the price for bad decisions, and “something has gone awry in the public’s understanding of business and free enterprise,” -Jamie Dimon
The letter in it's entirety is embedded below.
DMR: A large number of people were fired from their jobs after missing work to take part in the "day without immigrants" protests. They're surprised, which surprises me.
Their firings are not the result of politics; rather, they're the result of the normal operation of businesses. Companies have to make examples by holding people accountable, lest all employees start thinking that they can just fail to show up on any given day without consequence.
If you're not incapacitated and simply decide that you don't want to go to work--especially for shift work and/or for time-sensitive positions--then you're running the risk of being fired. There's no exception for those who want to go protest. If you're going to miss work for any reason and do not use vacation time, sick leave, holidays, etc., then you're running the risk of being fired.
Companies pay people to do jobs, not to protest. You protest on your own time. If you want to protest, do it on a day off. Do it on a holiday. Do it using vacation time. Don't do it on your company's dime, and DEFINITELY don't do it on the taxpayer dime.
This idea that people are entitled to their jobs and paychecks when they miss work as long as they missed work for their own ideas about social justice must end. Take a look at your company's leave policy, to which you agreed when you accepted the job offer. I am confident that it doesn't say "vacation time must be used when you plan to miss work unless you plan to miss work to take part in any protest of your choosing."
Companies are not welfare dispensaries. They're not entitlement institutions, and they're not "safe spaces." They're the real world: they're bottom-line organizations. You should be aware of this before you accept a job offer. If you want to protest, do it the right way. If you have no vacation time to use and it isn't a holiday, then don't protest unless you have the clear permission of your supervisor.
This is also unfair to your co-workers who honored their obligations to be at work. They have to take up your slack when you're suddenly out of the office without permission or warning. That should be kept to a minimum and should never happen due to a reason like "I just preferred to do something else with my time today" (unless you're using your vacation time, which should have been de-conflicted).
If your absence led to the closing of a business that day, then you probably harmed ALL of your co-workers, many of your customers, and the business itself. This is why companies can't tell all of their employees to feel free to miss work without warning whenever they want as long as they're out protesting. What are supervisors to do now, start taking roll call at all the local protests? That's ridiculous. If companies let employees get away with this, then you'd suddenly have many, many employees who could always find a good protest or two to attend somewhere. There would be those who'd never let a good protest go to waste. Jobs are not hobbies to which you show up only when you feel like doing so.
This is not an anti-protest post. It's an anti-entitlement post. A person who can't imagine being fired for missing shift work without permission is a person who feels entitled to his job. There is a right and a wrong way to do everything worth doing. Go protest, but do it the right way.
Henry Hazlitt’s 1946 book Economics in One Lesson is regarded as a classic introduction to free market economics. Nobel prize winning economist Milton Friedman said of the book: “[Hazlitt’s] explanation of how a price system works is a true classic: timeless, correct, painlessly instructive.” The book’s titular lesson argues:
The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
The entire premise of the book is found in this one sentence, and the chapters that follow are filled with examples of what happens when economic central planners focus on policy effects to one group while ignoring the secondary effects of their policies on all other groups. Hazlitt goes on to explain, in Chapter 17, the effects of governmental price fixing:
Let us first see what happens when the government tries to keep the price of a single commodity, or a small group of commodities, below the price that would be set in a free competitive market.
The argument for holding down the price of these goods will run something like this: If we leave beef (let us say) to the mercies of the free market, the price will be pushed up by competitive bidding so that only the rich will get it. People will get beef not in proportion to their need, but only in proportion to their purchasing power. If we keep the price down, everyone will get his fair share.
The first thing to be noticed about this argument is that if it is valid the policy adopted is inconsistent and timorous. For if purchasing power rather than need determines the distribution of beef at a market price of $2.25 cents a pound, it would also determine it, though perhaps to a slightly smaller degree, at, say, a legal “ceiling” price of $1.50 cents a pound. The purchasing-power-rather-than-need argument, in fact, holds as long as we charge anything for beef whatever. It would cease to apply only if beef were given away.
A similar situation exists in Bitcoin where the independent development team known as Bitcoin Core is artificially suppressing the cost of full-node operation — in effect, impeding free market forces. “This is for the benefit of the consumers,” they say, ignoring the effects of this policy on the >99.9% of Bitcoin users who do not run a full node. As Hazlitt notes, this line of thinking is inconsistent because, regardless of the price at which something is fixed, there will always be people who cannot afford it. The only sound logical conclusions to be drawn from this line of thinking are to either set the price at zero or to allow the price to be dictated by the free market. More tenuous still is the supposition that current full node users will be “priced out” by a block size increase.
Not your typical full node users.
But schemes for maximum price-fixing usually begin as efforts to “keep the cost of living from rising.” And so their sponsors unconsciously assume that there is something peculiarly “normal” or sacrosanct about the market price at the moment from which their control starts. That starting or previous price is regarded as “reasonable,” and any price above that as “unreasonable,” regardless of changes in the conditions of production or demand since that starting price was first established.
Bitcoin Core’s central planning inherently declares the cost of node operation today to be reasonable, but this is done without providing any hard data about which users are running a node, much less what their needs are, which costs they can bear, and so on.
In discussing this subject, there is no point in assuming a price control that would fix prices exactly where a free market would place them in any case. That would be the same as having no price control at all. We must assume that the purchasing power in the hands of the public is greater than the supply of goods available, and that prices are being held down by the government below the levels to which a free market would put them.
Now we cannot hold the price of any commodity below its market level without in time bringing about two consequences. The first is to increase the demand for that commodity. Because the commodity is cheaper, people are both tempted to buy, and can afford to buy, more of it. The second consequence is to reduce the supply of that commodity. Because people buy more, the accumulated supply is more quickly taken from the shelves of merchants. But in addition to this, production of that commodity is discouraged. Profit margins are reduced or wiped out. The marginal producers are driven out of business. Even the most efficient producers may be called upon to turn out their product at a loss. This happened in World War II when slaughterhouses were required by the Office of Price Administration to slaughter and process meat for less than the cost to them of cattle on the hoof and the labor of slaughter and processing.
In Bitcoin, block space is the commodity supply being artificially restricted. The producers of this commodity are the miners (although they do not produce a physical good, the analogy holds). Restricting the availability of the block space commodity indeed discourages the further production of such. New entrants into the Bitcoin mining business are thereby disincentivized: if the cost of producing a bitcoin has already reached its marginal level, then the profits available to new market entrants are not great enough to incentivize the risk-taking required of new mining operations. By dictating such policies and not allowing goods to be subject to the free-market-at-work, Core discourages new competitors and directly contributes to the centralization of mining!
If we did nothing else, therefore, the consequence of fixing a maximum price for a particular commodity would be to bring about a shortage of that commodity. But this is precisely the opposite of what the government regulators originally wanted to do. For it is the very commodities selected for maximum price-fixing that the regulators most want to keep in abundant supply. But when they limit the wages and the profits of those who make these commodities, without also limiting the wages and profits of those who make luxuries or semiluxuries, they discourage the production of the price-controlled necessities while they relatively stimulate the production of less essential goods.
The regulators wish to keep the ability of consumers to perform Bitcoin transactions in abundant supply, while simultaneously restricting the available supply of on-chain Bitcoin transactions. Thus the production of “luxuries” or less essential goods is stimulated: Lightning networks, sidechains, centralized clearinghouses, and altcoins. More foolish than the governmental central planners in Hazlitt’s example, many of the goods that Core assumes will pick up the slack for scarcity of on-chain transactions do not even exist yet.
Some of these consequences in time become apparent to the regulators, who then adopt various other devices and controls in an attempt to avert them. Among these devices are rationing, cost-control, subsidies, and universal price-fixing.
The cost of making a normal Bitcoin transaction becomes too high, so the cost of a segwit transaction shall then be fixed at one-fourth the cost of a regular Bitcoin transaction, Core has decided. Problem solved? Hazlitt explains,
When it becomes obvious that a shortage of some commodity is developing as a result of a price fixed below the market, rich consumers are accused of taking “more than their fair share;” or, if it is a raw material that enters into manufacture, individual firms are accused of “hoarding” it. The government then adopts a set of rules concerning who shall have priority in buying that commodity, or to whom and in what quantities it shall be allocated, or how it shall be rationed. If a rationing system is adopted, it means that each consumer can have only a certain maximum supply, no matter how much he is willing to pay for more.
We can see this today in Bitcoin when certain transactions are accused of being “spam” or of taking unfair advantage of the limited block space commodity. Nevermind that these so-called spam transactions pay the fair market rate to be included, or that these transactions are slapped with the spam epithet on no grounds other than their frequency or their size.
The government may try to meet this difficulty through subsidies. It recognizes, for example, that when it keeps the price of milk or butter below the level of the market, or below the relative level at which it fixes other prices, a shortage may result because of lower wages or profit margins for the production of milk or butter as compared with other commodities. Therefore the government attempts to compensate for this by paying a subsidy to the milk and butter producers. Passing over the administrative difficulties involved in this, and assuming that the subsidy is just enough to assure the desired relative production of milk and butter, it is clear that, though the subsidy is paid to producers, those who are really being subsidized are the consumers. For the producers are on net balance getting no more for their milk and butter than if they had been allowed to charge the free market price in the first place; but the consumers are getting their milk and butter at a great deal below the free market price. They are being subsidized to the extent of the difference — that is, by the amount of subsidy paid ostensibly to the producers.
Again, the consumer is told that the price controls are for their own benefit: “Why are you concerned? You’ll be able to make transactions for less than you can now!” But the producers are on net balance getting no more for their block space than if they had been allowed to charge the free market price in the first place. Worse still, if all Bitcoin transaction activity switched to the segwit format overnight, the miners are now being paid the same as before while bearing four times the burden of resources required. That Core does not consider this outcome disastrous is only a testament to the trivial cost of node operation even as resource requirements are increased.
Now unless the subsidized commodity is also rationed, it is those with the most purchasing power that can buy most of it. This means that they are being subsidized more than those with less purchasing power. Who subsidizes the consumers will depend upon the incidence of taxation. But men in their role of taxpayers will be subsidizing themselves in their role of consumers. It becomes a little difficult to trace in this maze precisely who is subsidizing whom. What is forgotten is that subsidies are paid for by someone, and that no method has been discovered by which the community gets something for nothing.
Treating segregated witness as a capacity increase, as the Bitcoin Core development team does, ignores that the subsidized commodity is still kept in restricted supply. By not allowing the supply to grow in line with what the free market is capable of providing, discounting segwit transactions allows only for a bit of breathing room until those transactions also end up in short supply and begin rising in cost, as is happening with regular transactions today.
Price-fixing may often appear for a short period to be successful. It can seem to work well for a while, particularly in wartime, when it is supported by patriotism and a sense of crisis. But the longer it is in effect the more its difficulties increase. When prices are arbitrarily held down by government compulsion, demand is chronically in excess of supply. We have seen that if the government attempts to prevent a shortage of a commodity by reducing also the prices of the labor, raw materials and other factors that go into its cost of production, it creates a shortage of these in turn. But not only will the government, if it pursues this course, find it necessary to extend price control more and more downwards, or “vertically”; it will find it no less necessary to extend price control “horizontally.” If we ration one commodity, and the public cannot get enough of it, though it still has excess purchasing power, it will turn to some substitute. The rationing of each commodity as it grows scarce, in other words, must put more and more pressure on the unrationed commodities that remain. If we assume that the government is successful in its efforts to prevent black markets (or at least prevents them from developing on a sufficient scale to nullify its legal prices), continued price control must drive it to the rationing of more and more commodities. This rationing cannot stop with consumers. In World War II it did not stop with consumers. It was applied first of all, in fact, in the allocation of raw materials to producers.
Assuming that the public has a fixed or growing demand for using money transfer systems, of which Bitcoin is merely one type, then the end result of restricting the available supply of Bitcoin transactions is that more and more pressure is put on unrationed commodities. Whether those unrationed commodities are traditional payment methods or altcoins, the end result spells disaster for Bitcoin.
The natural consequence of a thoroughgoing over-all price control which seeks to perpetuate a given historic price level, in brief, must ultimately be a completely regimented economy. Wages would have to be held down as rigidly as prices. Labor would have to be rationed as ruthlessly as raw materials. The end result would be that the government would not only tell each consumer precisely how much of each commodity he could have; it would tell each manufacturer precisely what quantity of each raw material he could have and what quantity of labor. Competitive bidding for workers could no more be tolerated than competitive bidding for materials. The result would be a petrified totalitarian economy, with every business firm and every worker at the mercy of the government, and with a final abandonment of all the traditional liberties we have known.
The Bitcoin economy, unlike state economies, is thankfully one of voluntary participation. While the end result of price controls, a petrified totalitarian economy, will be the same, the consumers in the Bitcoin economy have a choice and do not need to remain participants. Packing up and moving to another cryptocurrency is far simpler than packing up and moving to a country with more favorable economic policies, and this is exactly what will happen (we are already seeing it happen with the news of Circle abandoning Bitcoin this week). Attempting to centrally plan Bitcoin’s underlying economics, as the Bitcoin Core developers do today, is guaranteed to lead Bitcoin down the path of irrelevance.
This first appeared at Medium.com
John Blocke writes at Medium.com.
This article was originally published on FEE.org. Read the original article.
I can't help myself.
I've written another free eBook.
This one is in response to all of you who have asked about how to start a podcast, or self-publish a book, or be an affiliate marketer, or whatever. I've learned a lot about that stuff, having done it all myself, and I know how to teach it.
After all, between the Tom Woods Show and Contra Krugman, I've released well over 800 podcast episodes. You can trust that I know something about it.
Here's a step-by-step overview of exactly what I do -- both in podcasting and in making a living online in general.
And yes: all these things can be monetized, if you know what you're doing.
You don't have to monetize them, of course. I blogged for years as a pure labor of love. But in my case, with five children and family health issues to cope with, I'm not upset when I'm compensated for something I enjoy doing. Who in his right mind would be?
Believe me, over the years I've made a lot of mistakes and gone down a lot of dead ends. You can save yourself the same fate by reading this book.
Get it here:
PS. Tom Woods has also put together an amazing resource where you can learn about Liberty, Free Markets and Economics all while commuting to work. Be a smarter libertarian! Check it out!
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After giving businesses more than six months to prepare, the final U.S. Department of Labor rule change regarding overtime regulations will become effective Dec. 1, affecting more than 4.2 million workers within the United States. With only one month left, do you know how the law will impact you and your employees?
If you recall back in June 2015, President Barack Obama proposed an adjustment to the Fair Labor Standards Act (FLSA) — which establishes the 40-hour workweek and rules to provide employees with a minimum wage and time and a half of their regular rate pay for working overtime — that would raise the minimum salary threshold for exempt employees.
Obama's main goal with the new rule is to strengthen the middle class, expand opportunity and grow the economy.
Check out Jason Stapleton's take below:
Patrice L. Onwuka from IWF.org says the first day of December can't come slow enough for many American employers who are scrambling to figure out how to avoid a financial blow when the Obama Administration’s new overtime rule kicks in. Check out her article "New Overtime Rules Will Have Unintended Consequences" here.
Overtime Rules Based on Bogus Economic Theory
This very day, millions of business managers are pulling their hair out, dealing with a genuine and traumatizing October Surprise that has nothing to do with the election. The Department of Labor, on its own and without a vote from Congress, has made a seemingly small administrative change that is profoundly and disastrously affecting the lives of probably tens of millions of people (if you include everyone directly and indirectly affected).
Its final implementation happens December 1, which means the clock is ticking.
People who six months ago imagined a career with a particular company now find themselves ghosted in light of financial realities.Anyone making less than $48,000 a year in salary is directly affected, and for many businesses this means thousands of people. This seemingly small change is upending many things about people’s career paths, sense of professional identity, and life plans.
And so many others, who are seeking entry-level positions to show how awesome they are, will be denied the opportunity to enter professional life at all, and their absence will not be counted because the costs are unseen. People who six months ago imagined a career with a particular company now find themselves ghosted in light of financial realities.
The regulatory change sounds merely technical at first. The government requires overtime pay for anyone working more than 40 hours per week (“time and a half”), but it only pertains to employees making less than $23.6K a year. We’ve come to think of this rule as applying only to entry-level wage employees.
No, You Can’t
I can recall being 18 years old and begging for more time but being denied by my boss due to this rule – an early experience in dealing with the effects of government regulation. It’s a strange situation: I wanted to work more and my employer wanted me to work more, but government rules made it too costly, so we both lost out. Such rules prevent mutually beneficial exchanges.
If you force payment, it means forgoing other things.Still, you were safe once you got on salary and made more than $23.6K. Only then are you free to work as much as you want.
But now the Department of Labor, with the stroke of a pen, has raised this level to $48K, meaning that some 4.2 million people are immediately and directly affected. If they work more than 40 hours per week, the regulations now require that employers pay them more for extra hours. That means, at minimum, massive new record-keeping requirements for both individuals and businesses. It turns out that businesses do not have some box stuffed with cash somewhere in a closet that they can raid to toss more money to existing employees. If you force payment, it means forgoing other things.
Bureaucrats with lifetime jobs know nothing about work in the private sector.The new rule could mean that millions of people will be reclassified to a lower-status job position: from salaried to per-hour wage. That’s not what anyone wants to happen.
Of course, the Department of Labor – because bureaucrats with lifetime jobs know nothing about work in the private sector – thinks that this is going to create new opportunities for the good life, because passing laws does this for society.
Actually, the rule is hugely disruptive of people’s actual plans and their capacity to make their own deals with their employers. People who desire to work more will be denied the chance, effectively forbidden by their own bosses from providing more value.
It’s true that probably millions of others making between $35-40K will be bumped up to $48K, a raise forced by administrative edict. This is so they can escape the overtime rules, but it comes at a cost.
They will be required to put in more value to the company in order to earn this salary increase, which means more work and less leisure time on their part – exactly the opposite of the stated purpose of the new rule.
Entry-level positions will be foregone in favor of regulatory compliance.These raises also come at the expense of job creation. Entry-level positions will be foregone in favor of regulatory compliance, which is to say that this small change is a job destroyer of the first order.
There are many terrible features of this change. The old law was becoming mercifully less and less relevant to American workers, one of the few good trends in business today. It was always an overly scripted, planned, and coercive way of granting “labor rights” by administrative edict, with all the secondary consequences that kind of bureaucratic rationalism inevitably entails. The Obama administration – with its unfailing instinct for making more messes within sectors that were repairing themselves gradually – has seen fit to blot out of the few good trends in labor markets today.
But consider too just how strange the government’s fixation on “labor hours” is. The idea is that the number of hours you work is the only real determination of the value you bring to your job, the only and definitive way to measure productivity. It’s like they are taking seriously Woody Allen’s dictum that “eighty percent of success is just showing up.” Clock in, clock out. You work more (or just show up more), you thereby produce more value; it’s the assumption that productivity is machine-like, and that value is somehow inherent in labor.
The Labor Theory of Value
Students of history will recognize this whole idea as the labor theory of value. If labor is the source of value, it is surely exploitation for the capitalist to gain so much in profit from the sale of goods. Government still adheres to it. Its outlines were mapped out by the classical economists, possibly even dating back to St. Thomas Aquinas. The classic formulation comes from David Ricardo, as a mistaken derivation of the relationship between cause and effect: “The value of a commodity, or the quantity of any other commodity for which it will exchange, depends on the relative quantity of labour which is necessary for its production..."
This minor error, intuitively plausible, persisted for centuries. It took Karl Marx to add the reductio ad absurdum: if labor is the source of value, it is surely exploitation for the capitalist to gain so much in profit from the sale of goods. Everything that doesn’t return to the worker constitutes ill-gotten gains and hence exploitation of the working man.
Now, just a moment’s reflection makes you realize that this supposed relationship between work and value is not direct. You can’t just make anything, do anything, sit in a chair, show up on time and vanish at the appointed hour, make whatever, and have the results be thereby valued in the marketplace.
The Marxian mania over the labor theory of value caused a generation of economists in the late 19th century to rethink the whole issue and discover the actual source of value. Value emanates from the human mind itself. It is the consumers who act on their values in the marketplace for final goods and services that signal producers about their own decisions. (Their theory in time came to be called the Subjective Theory of Value.)
And all capitalists know this. Everything they produce, every penny they spend on workers or research or marketing, is subject to a final test in the marketplace. Consumers can make a rock valuable or worthless, a song go gold or die immediately, a smartphone all the rage or sit on the shelf, a strip mall become a profit center or be boarded up due to lack of interest. There is nothing that more labor can add to determine whether something is or isn’t a success in the marketplace.
Work as a Proxy
It’s true that sizable portions of today’s contracting workforce charge “by the hour” for its work. By doing so, what you have is the estimation of the passage of time in value terms, given the existence of opportunity costs for the use of that time. But charging by the hour is only a convenient proxy for productivity in general; it is not claiming literally that the passage of time on the clock somehow causes wealth to be produced. And every contractor knows this: if your results are not good, the contract will be discontinued.
The Department of Labor wildly exaggerates the role of labor hours in discerning, determining, and measuring economic value.But in the hands of bureaucrats, the allegorical proxy becomes the real thing. With its mechanical understanding of the process of wealth generation, the Department of Labor wildly exaggerates the role of labor hours in discerning, determining, and measuring economic value. It cares nothing for smarter work, more efficient work, the differences in talent between workers, the aspect of learning, the role of entrepreneurship in speculating about the value of future final output, or anything else. Instead, they use a model derived from mechanics to govern human action, which is anything but mechanical.
The subjective theory of economic value was a revolutionary insight precisely because it blew up the old assumptions concerning the causative relationship between work and reward. In theory, a worker who has one billion-dollar insight that took 5 seconds to discern is worth vastly more than a worker who spent ten thousand hours making mud pies. And what does this imply about the capacity of outside agents in government to manage economic relationships? It means it can’t be done. We have to leave to market forces to work out what is best for everyone in the ongoing process of experimentation, marketing, innovation, and learning.
Bad Theory Comes Home
But tell that to the arrogant public servants ensconced in marble palaces in the Beltway. Armed with their dated and formalistic models, they imagine that they can merely change a rule and thereby cause justice to be newly born in the world. They have been trying for 100 years, limiting work, channeling work, managing work, slicing and dicing work.
The greatest and most intense cost will be felt by the young and ambitious among entry-level employees. There is far more complexity in labor markets than these rules would indicate. This is especially true today, when people work from everywhere, whenever, however, under an ever-greater variety of institutional arrangements. Every intervention designed to manipulate outcomes will produce unexpected costs that benefit neither workers nor capitalists. At best the attempt creates headaches. At worst, it ruins lives.
What will be the worst result of this rule? It will reduce productivity, demoralize many employees, and create vast and useless paperwork.
I continue to believe that the greatest and most intense cost will be felt by the young and ambitious among entry-level employees. This person might be hired at $32K but desire to put in an extra 10, 20, or 30 hours will be blocked by supervisors. Excellence is punished. Ambition is blocked. Dreams are crushed. And all from one change in the regulations.
In the real world, as versus the artificial models tossed around the halls of the regulatory bureaucracies, bad theory leads to a worsening of the quality of life. And all this happens at the worst possible time for both business and labor. Yes, markets will adapt. They always do. But never think that it doesn’t come at a high cost.
Jeffrey Tucker is Director of Content for the Foundation for Economic Education and CLO of the startup Liberty.me. Author of five books, and many thousands of articles, he speaks at FEE summer seminars and other events. His latest book is Bit by Bit: How P2P Is Freeing the World. Follow on Twitter and Like on Facebook. Email. Tweets by @jeffreyatucker
This article was originally published on FEE.org. Read the original article.
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Lessons from the A-taco-lypse
Marco Gutierrez unknowingly gave the best pitch for liberty last week—and he did so only using five words. During an interview with MSNBC, the founder of Latinos for Trump warned that if his candidate didn’t win in November, there would be “taco trucks on every corner.”
This hypothetical taco truck bubble denotes another issue that is not being widely discussed.
Obviously, Gutierrez intended to rattle the cages of nativists left and right—one side to call him racist, while the other can only seem to muster up dystopian platitudes about being “invaded by illegal immigrants.”
But Gutierrez’s words backfired beautifully. Within seconds, #TacoTrucksOnEveryCorner was trending, and a vocal (and wildly humorous) majority of Americans gave a collective thumbs up to this compelling vision for the future. Unsurprising to those who mocked Gutierrez, the idea of taco trucks on every corner is very appealing.
The most obvious issue raised by this conversation is immigration. However, this hypothetical taco truck bubble denotes another issue that is not being widely discussed: how local governments tend to restrict – rather than embrace – entrepreneurial trends, and unnecessarily insert themselves between consumers and businesses.
The “Roach Coach” Renaissance
Once derogatorily referred to as “roach coaches,” taco trucks have morphed into a diverse, eclectic, and highly profitable industry. In less than a decade, a growing army of foodie entrepreneurs – peddling mobile culinary treats once only available in traditional brick-and-mortar restaurants – have created an $800 million industry, and its popularity continues to grow by the day.
This revolutionary business model has been widely embraced by consumers worldwide.
We are, arguably, at our economy’s peak quantity of food trucks at this very moment. Yet, judging by the vociferous reaction to Gutierrez’s misguided “a-taco-lypse,” the current availability of food trucks isn’t enough; people are demanding more.
Food trucks are a part of a broader pattern of entrepreneurship that jettisons traditional institutions, skirts around bureaucratic oversight, and provides an in-demand service or product directly to a very eager consumer base. With the advent of Uber, AirBnB, and a number of other cutting-edge businesses, this revolutionary business model has been widely embraced by consumers worldwide.
Oddly enough, research indicates that these businesses produce a mass psychological perk as well, inspiring human engagement, promoting a broader sense of trust, and – in the words of NYU professor Arun Sundarajan – “reversing America’s decades-long slide into mass cynicism.” (This author in particular has discovered a direct correlation between his own happiness and proximity to tacos.)
Local Government’s Motto: “When in Doubt, Tax, Regulate, or Ban it”
Unfortunately, bypassing barriers of entry has produced unintended political costs on the backend. Political leaders and regulatory agencies are in a panic to retrofit existing policies that didn’t initially include these new businesses into their statutory calculations.
The result of this panic: heavy-handed and obtuse rules that seem to be more about maintaining economic control than safeguarding a public good. AirBnB has faced relentless backlash from a variety of municipalities who want to register hosts, set size requirements for each shared space, and even mandate business licenses for participants. New York is currently debating a hefty series of fines for AirBnB hosts who “illegally” advertise restricted types of properties for rent with contract agreements shorter than 30 days.
Meanwhile, Uber and Lyft have both faced significant pushback from local governments and taxi unions, demonstrating an obvious incestuous relationship between the two entities. The most glaring example of this collusion came in the form a per-ride tax imposed in Massachusetts, where revenue extracted from the ride-sharing industry directly subsidizes the failing taxi industry’s efforts to innovate and implement their own ride-sharing technology.
These concerted efforts to rein in new companies highlight how “a very simple business model can become muddied when it meets real-world markets, and alters them,” writes Adam Chandler of The Atlantic.
Ordinances? We Don’t Need No Stinkin’ Ordinances
The same applies to the food truck movement and how they have disrupted local municipalities’ grip on economic planning. For example, food trucks have recently become a hotbed issue in Chicago. In 2012, the city passed a series of restrictions on the food truck industry – from how big their vehicles could be to how long they could do business in one physical location. Last month, the Chicago Sun-Times and local news affiliate ABC7 released a “damning” report that found that food truck operators were typically in violation of these ordinances and oversight was lax. (They say it like these are bad things.)
Consumer behavior seems to support these maverick business practices.
However, what’s missing from the journalistic investigation is any discussion of an incurred damage or perceived social ill created by the food truck industry. Are people getting sick from the food truck cuisine? What damages are caused by food trucks that remain in the same spot for three or four hours at a time? Other than breaking capricious and unenforceable rules, the perceived “lawlessness” of the Chicago food trucks does not demonstrate a significant liability to public safety.
Global positioning devices are required on all Chicago food trucks, so local regulators can investigate operators who are violating the “two hour rule”, which mandates the food trucks cannot remain at the same physical location for this short and arbitrary timeframe. The Chicago Sun-Times/ABC7 report highlights the fact that many food trucks ignore the two-hour rule. The report quotes Emily Darland, a food truck owner in Chicago, who isn’t shy about her own brazen violation of this rule (and many others):
“Nobody moves after two hours,” Darland said. “No one does.
“The people making the rules have no idea what it’s like to be out here in business.”
So where’s the crackdown on this food truck piracy? With so many food trucks in violation of the law, there must be good Samaritans snitching to local law enforcement about these lawless foodies, right? Not so much.
In fact, consumer behavior seems to support these maverick business practices. For example, to warrant an investigation by the City of Chicago, complaints must be filed before regulators can pull GPS data on specific operators who might be staying beyond their two-hour window. Mika Stambaugh, a spokeswoman for the Business Affairs Department of the city government that oversees these ordinances, states, “We haven’t received enough complaints warranting a GPS search.”
Food truck patrons apparently can’t talk on the phone with law enforcement when they are sporting a mouthful of savory Korean barbeque, Latin American paletas, deep-dish pizza, hot dogs with every imaginable garnishment, pretzel-bunned deli sandwich, or whatever unique food truck delicacy that are currently stuffing their mouths with at the moment. (If that last sentence didn’t make you drool, there are also food trucks that specialize in kale.)
Envisioning the taco truck utopia elicits an age-old political motto: “think globally, act locally.” While supporting less restrictive immigration policies from their federal government, taco truck utopians must also turn their attention to the local ordinances that needlessly attempt (and often fail) to centrally plan industries that pose no immediate threat to the public at large. In other words, don’t tread on my taco trucks.
Jay Stooksberry is a freelance writer with a passion for liberty, skepticism, humor, and whiskey. When he's not writing, he splits his time between marketing consultation and spending time with his wife and son. Follow him on Facebook and Twitter.
This article was originally published on FEE.org. Read the original article.
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12NOV EDIT: David Stockman's book is COMPLETE!
David Stockman was working on a new book and was releasing snippets in his blog over at http://davidstockmanscontracorner.com/
It delves into the good and bad of the Trump campaign and platform and outlines a more consistent way forward based on free markets, fiscal rectitude, sound money, constitutional liberty, non-intervention abroad, minimalist government at home and decentralized political rule.
Here's a great list of actual deals that the next President, whoever it is, should immediately negotiate:
Ten Great Deals For The Donald
If Donald Trump is elected, eschews a law and order crusade and does not capitulate to the destructive policies of the Wall Street/Washington/bicoastal establishment, there is a way forward. The political outlaw who considers himself to be the world’s greatest deal-maker would need to do just that.
To wit, a President Trump determined to rid the nation of its mutant regime of Bubble Finance at home and failed interventionism abroad would need to make Ten Great Deals.
A Peace Deal with Putin for dismantlement of NATO, cooperation in the middle east, strangulation of ISIS by the Shiite Crescent and a comprehensive worldwide agreement to end the arms trade and pave the way for general disarmament.
A Jobs Deal based on slashing taxes on business and workers and replacing them with taxes on consumption and imports.
A Sound Money Deal to repeal Humphrey-Hawkins, end the Fed’s war on savers and cash, abolish the FOMC and limit the Fed’s remit to passively providing liquidity at a penalty spread over market interest rates based on sound commercial collateral.
A Glass-Steagall Deal to break up the giant financial conglomerates, limit the Fed’s liquidity window to “narrow banks” which only take deposits and make loans and deny deposit insurance to any banking institution involved in Wall Street trading, derivatives and other forms of financial gambling.
A Federalist Deal to turn back most of Washington’s domestic grant and welfare programs to the states and localities in return for a mega-block grant with a 30-year phase-out.
A Regulatory Deal based on an absolute 4-year freeze on every single pending regulation, and then subjecting every existing statute to strict cost-benefit rules thereafter.
A Liberty Deal to get Washington out of the war on drugs, criminal law enforcement and regulation of private conduct and morality.
A Health Care Deal based on the repeal of Obamacare and tax preferences for employer insurance plans and their replacement with wide-open provider competition, consumer choice and individual health tax credits.
A Fiscal Deal to slash post-disarmament defense spending, devolve education and other domestic programs to local government and to clawback unearned social security/medicare entitlements benefits from the affluent elderly.
And a Governance Deal to amend the constitution to rescind Citizens United, impose term limits and establish public finance of all Federal elections.
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We wrote earlier this week concerning the banning/throttling of conservative ideas on Facebook, specifically the Being Libertarian page. We noted that as a private company, FB owns it's own servers and can ban speech it doesn't politically agree with. We concluded that as free-market believers, while no law has been broken, we should seek to expose this as much as possible so others are knowledgeable and can boycott or stop using the product if necessary.
Well, it's happening again, this time with Twitter banning Conservative LGBT advocate, Milo Yiannopoulos.
The contretemps has been brewing all week, as Milo engaged in a barbed to and fro with embattled Ghostbusters star Leslie Jones over her Twitter feud with trolls who hated her new movie. At one point the CEO of Twitter Jack Dorsey intervened himself, asking Jones to direct message him. Milo himself said nothing racist, though he joked that Jones’ grammatically challenged quips at him were “barely literate”, said America needs better schools and referred to Jones facetiously as “a black dude”.
Milo has been suspended from Twitter before and also lost his verification tag. Will tonight’s suspension really be permanent?
Earlier today Milo said he was not sorry for his dialogue with Jones.
“No, of course, I don’t have any regrets,” Milo told Heat Street. “But feminists on the other hand should have regrets that they have taught strong women that they are victims and attacked people for having different opinions to them on Twitter.”
We'll see how this ends, however, it should be noted that Ms. Jones isn't exactly the perfect angel on Twitter.
The Social Justice Lovin' NYT covers the behavior by noting:
For years, one of the main grievances among Twitter users has been the ability of anonymous trolls to send abusive comments to other people on the service.
But on Tuesday, Twitter barred one of the most egregious and consistent offenders of its terms of service, Milo Yiannopoulos, in an attempt to show that it is cracking down on abuse.
The NYT emotionally tear-jerking story ends with some contrived sympathy towards Ms. Jones and sets her up as a victim:
On Monday evening, Ms. Jones quit using Twitter with a final message of exasperation after days of near-nonstop abuse. “I leave Twitter tonight with tears and a very sad heart,” Ms. Jones tweeted. “All this cause I did a movie.” On Monday evening, Ms. Jones quit using Twitter with a final message of exasperation after days of near-nonstop abuse. “I leave Twitter tonight with tears and a very
sad heart,” Ms. Jones tweeted. “All this cause I did a movie.”
We're still waiting for our ban. It's really our only goal at this point.
Please share this story to help our friends at Being Libertarian get their page back. They’ve worked arduously to build a loyal following of more than 90,000 fans who enjoy their daily content, and would appreciate if you could give them a helping hand.
Liberty Hangout reports that Facebook has shut down "Being Libertarian" a FB page with over 90,000 followers due to the following post:
Liberty Hangout reports:
"Being Libertarian has reached out to Facebook in hopes of receiving a media inquiry about the deletion of their page. After Facebook was recently caught tailoring their news towards liberal sources, it was believed that their relationship with non-liberals would improve. But this week’s turn of events indicate that things aren’t getting any better. We know that conservatives are being censored by Facebook, but the censorship of libertarians is even worse."
One thing that separates us from the Neanderthals is that we follow principles. The principle of Free Markey Economics tells us that while banning BEING LIBERTARIAN is quite outrageous, FB is the private property of Mark Zuckerberg and he can do with it what he wishes. A key theme of free market capitalism is that we have the ability to not use a product or support a company that acts in a way we don't agree with. Unfortunately, with FB, we're not rushing to reactivate our Myspace pages any time soon.
I'd recommend sharing this article, sharing other articles that are reporting the same, and getting the word out as much as possible. It's important as we lead up to prime election season that , at the minimum, the politically illiterate are at least tapped into the fact that FB might not always be the most 'fair and balanced' place to start their research. Also, neither is Fox News...
Jason Stapleton over at JasonStapleton.com released his long-awaited Recommended Reading List on the 4th of July. It spans fiction and non-fiction and covers libertarian philosophy, economy and culture as well.
Check out the episode below (57minutes):
The Revolution: A Manifesto by Ron Paul
Don't Hurt People and Don't Take Their Stuff: A Libertarian Manifesto by Matt Kibbe
American Contempt for Libertyby Walter E. Williams
Liberty and Tyranny: A Conservative Manifestoby Mark R. Levin
Real Dissent: A Libertarian Sets Fire to the Index Card of Allowable Opinion by Thomas E. Woods
Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economicsby Henry Hazlitt
Basic Economics 5th Editionby Thomas Sowell
Battlefield America: The War On The American Peopleby John W. Whitehead
Stonewalled: My Fight for Truth Against the Forces of Obstruction, Intimidation, and Harassment in Obama's Washington by Sharyl Attkisson
The Count of Monte Cristoby Alexandre Dumas père
Atlas Shrugged by Ayn Rand
The Richest Man in Babylonby George S. Clason
Nero Wolfe (or anything) by Rex Stout
Psychology and Markets
The Gift of Fear and Other Survival Signals that Protect Us From Violenceby Gavin de Becker
The Power of Habit: Why We Do What We Do in Life and Business by Charles Duhigg
Predictably Irrational, Revised and Expanded Edition: The Hidden Forces That Shape Our Decisionsby Dan Ariely
Influence: The Psychology of Persuasionby Robert B. Cialdini
The 48 Laws of Power by Greene, Robert
The cliffnotes version "Summary, Key Takeaways & Analysis "is free with kindleunlimited.
Ready, Fire, Aim: Zero to $100 Million in No Time Flatby Michael Masterson
How to Get Rich: One of the World's Greatest Entrepreneurs Shares His Secrets by Felix Dennis
Reminiscences of a Stock Operator by Edwin Lefèvre
One Good Trade: Inside the Highly Competitive World of Proprietary Tradingby Mike Bellafiore
Market Wizards, Updated: Interviews With Top Tradersby Jack D. Schwager
Andrew Carnegieby David Nasaw
Titan: The Life of John D. Rockefeller, Sr.by Ron Chernow
The First Tycoon: The Epic Life of Cornelius Vanderbiltby T.J. Stiles
Anything by Joseph J Ellis specifically:
Founding Brothers: The Revolutionary Generation
His Excellency: George Washington
The Quartet: Orchestrating the Second American Revolution, 1783-1789
Many of these titles can be downloaded FOR FREE with Amazon KindleUnlimited:
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