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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. Centralizing Bitcoin 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. Stunting Growth 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 BlockeJohn Blocke writes at Medium.com. This article was originally published on FEE.org. Read the original article.
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Since Congress and our Intelligence Agencies have little to no credibility amongst the public, Reason.com urges them to heed Justin Amash's call for transparency in the matter.
Reason.com notes "The stories, however, are based on anonymous sources from groups whose records of obfuscations, mistakes, and screw-ups are legendary." Specifically, the Washington Post reports: "It is the assessment of the intelligence community that Russia's goal here was to favor one candidate over the other, to help Trump get elected," said a senior U.S. official briefed on an intelligence presentation made to U.S. senators. "That's the consensus view." "The CIA shared its latest assessment with key senators in a closed-door briefing on Capitol Hill last week, in which agency officials cited a growing body of intelligence from multiple sources. Agency briefers told the senators it was now "quite clear" that electing Trump was Russia's goal, according to the officials, who spoke on the condition of anonymity to discuss intelligence matters." Neither Amash or Reason.com's skepticism is out in left field here. Let's look at a quick report card of lies told by the CIA and repeated by the New York Times which ultimately led to war. Gulf of Tonkin (Vietnam) Questions about the Gulf of Tonkin incidents have persisted for more than 40 years. But once-classified documents and tapes released in the past several years, combined with previously uncovered facts, make clear that high government officials distorted facts and deceived the American public about events that led to full U.S. involvement in the Vietnam War. The Washington Post, now claiming Russian hacking led with this headline on Aug. 5, 1964: “American Planes Hit North Vietnam After Second Attack on Our Destroyers; Move Taken to Halt New Aggression”. That same day, the front page of the New York Times reported: “President Johnson has ordered retaliatory action against gunboats and ‘certain supporting facilities in North Vietnam’ after renewed attacks against American destroyers in the Gulf of Tonkin.” But there was no “second attack” by North Vietnam — no “renewed attacks against American destroyers.” By reporting official claims as absolute truths, American journalism opened the floodgates for the bloody Vietnam War. Babies dumped out of incubators in Kuwait (Gulf War) The Nayirah testimony was a false testimony given before the Congressional Human Rights Caucus on October 10, 1990 by a 15-year-old girl who provided only her first name, Nayirah. Her tear-jerking story included "312 premature babies at Kuwait City's maternity hospital who died after Iraqi soldiers stole their incubators and left the infants on the floor," and of "babies pulled from incubators and scattered like firewood across the floor." The testimony was widely publicized, and was cited numerous times by United States senators and President George H.W. Bush in their rationale to back Kuwait in the Gulf War. In 1992, it was revealed that Nayirah's last name was al-Ṣabaḥ and that she was the daughter of Saud Al-Sabah, the Kuwaiti ambassador to the United States. Furthermore, it was revealed that her testimony was organized as part of the Citizens for a Free Kuwait public relations campaign which was run by American Hill & Knowlton for the Kuwaiti government. Following this, al-Sabah's testimony has come to be regarded as a classic example of modern atrocity propaganda. Iraqi WMD (2003 invasion of Iraq) The United States and the UK asserted that Saddam Hussein still possessed large hidden stockpiles of weapons of mass destruction (WMD) in 2003, and that he was clandestinely procuring and producing more. Inspections by the UN to resolve the status of unresolved disarmament questions restarted between November 2002 and March 2003, under UN Security Council Resolution 1441, which demanded Saddam give "immediate, unconditional and active cooperation" with UN and IAEA inspections, shortly before his country was attacked. The CIA later declassified the document that supposedly proved our involvement in Iraq, one that persists after 12 years with no end in sight. But its contents are not what top Bush administration officials said during their campaign to sell the war to the American public. Those officials, citing the same classified document, asserted with no uncertainty that Iraq was actively pursuing nuclear weapons, concealing a vast chemical and biological weapons arsenal, and posing an immediate and grave threat to US national security. Fake CIA videos of beheadings in Syria (Not technically on this list as it failed to get Boots-on-Ground) A 2010 Washington Post article authored by former Army Intelligence Officer Jeff Stein features a detailed account of how the CIA admittedly filmed a fake Bin Laden video during the run up to the 2003 Iraq war. The article, which includes comments from multiple sources within the CIA’s Iraq Operations Group, explains how the agency had planned to “flood Iraq with the videos” depicting several controversial scenarios. “The agency actually did make a video purporting to show Osama bin Laden and his cronies sitting around a campfire swigging bottles of liquor and savoring their conquests with boys, one of the former CIA officers recalled, chuckling at the memory,” the article states. “The actors were drawn from ‘some of us darker-skinned employees.’” If you recall, after a fierce pushback of public outrage at the thought of intervening in Syria, the beheading videos turned the tide of US Interventionism. There are no believable reports at this time that the CIA was directly involved with the fake Foley beheading videos though it's been proven the beheadings we fake and this ia a tool in their toolbox. Don't you think maybe skepticism and investigation are in order? Some have already thought aloud of the possibility that the CIA is hoping to raise enough doubt to change electors from casting faithful Trump votes. There's irony for you. In an attempt to ensure 'Russian Hackers' from affecting our election, Electoral College voters cast votes against the will of the people for an apparent criminal. In its continuing coverage, The New York Times notes that the new revelations aren't even based on new evidence: "The C.I.A.'s conclusion does not appear to be the product of specific new intelligence obtained since the election, several American officials, including some who had read the agency's briefing, said on Sunday. Rather, it was an analysis of what many believe is overwhelming circumstantial evidence—evidence that others feel does not support firm judgments—that the Russians put a thumb on the scale for Mr. Trump, and got their desired outcome. It is unclear why the C.I.A. did not produce this formal assessment before the election, although several officials said that parts of it had been made available to President Obama in the presidential daily briefing in the weeks before the vote. But the conclusion that Moscow ran an operation to help install the next president is one of the most consequential analyses by American spy agencies in years." We should demand transparency. And as long as we're demanding transparency, let's get it as well for Soros donations and for foreign government donations to the Clinton Foundation, just in the unlikely event that any of that affected the election. That won't happen though because there was a day where getting information on political people (Nixon) would get you a Pulitzer, these days releasing the truth gets you threats of prison. Finally, the CIA is the masters of the universe whose foreign policy Hillary exemplifies, and Trump potentially threatens. Conflict of interest exists to say the very least. The FBI is denying that there is any evidence that Russia hacked the DNC or the RNC. But why don't we start with the CIA and see their evidence. Then, don't stop there. Release information on all the Foreign Elections we have rigged as well. Like this one in Russia: "Get the equivalent of a Ph.D. in libertarian thought and free-market economics online for just 24 cents a day." Follow libertyLOL on your favorite social media sites:FacebookYoutube Tumblr Pintrest Countable: Government Made Simple Steemit blog on a blockchain Patreon Gab.ai libertyLOL's Liberty Blog RSS Feed We also run a couple twitterbots which provide great quotes and book suggestions: Murray Rothbard Suggests Tom Woods Suggests Jason Stapleton Suggests Progressive Contradictions MORE FROM LIBERTYLOL:
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If you ask what worries me about the incoming Trump Administration, I’ll immediately point to a bunch of policy issues.
Others, though, are more focused on whether Trump’s business empire will distort decisions in the White House. Here’s what Paul Krugman recently wrote about Trump and potential corruption.
I’m tempted to ask why Krugman wasn’t similarly worried about corruption over the past eight years. Was he fretting about Solyndra-type scams? About the pay-to-play antics at the Clinton Foundation? About Operation Choke Point and arbitrary denial of financial services to law-abiding citizens? He seems to think that the problem of malfeasance only exists when his team isn’t in power. But that’s totally backwards. As I wrote back in 2010, people should be especially concerned and vigilant when their party holds power. It’s not just common sense. It should be a moral obligation. But even if Krugman is a hypocrite, that doesn’t mean he’s wrong. At least not in this case. He is absolutely on the mark when he frets about the “incentives” for massive looting by Trump and his allies. But what frustrates me is that he doesn’t draw the obvious conclusion, which is that the incentive to loot mostly exists because there’s an ability to loot. And the ability to loot mostly exists because the federal government is so big and has so much power. And as Lord Acton famously warned, power is very tempting and very corrupting. Which is why I’m hoping that Krugman will read John Stossel’s new column for Reason. In the piece, John correctly points out that the only way to “drain the swamp” is to shrink the size and scope of government.
As you can see, Stossel understands “public choice” and recognizes that making government smaller is the only sure-fire way of reducing public corruption. Which is music to my ears, for obvious reasons. By the way, the same problem exists in many other countries and this connects to the controversies about Trump and his business dealings. Many of the stories about potential misbehavior during a Trump Administration focus on whether the President will adjust American policy in exchange for permits and other favors from foreign governments. But that temptation wouldn’t exist if entrepreneurs didn’t need to get permission from bureaucrats before building things such as hotels and golf courses. In other words, if more nations copied Singapore and New Zealand, there wouldn’t be much reason to worry whether the new president was willing to swap policy for permits. Republished from Dan Mitchell's blog. Daniel J. MitchellDaniel J. Mitchell is a senior fellow at the Cato Institute who specializes in fiscal policy, particularly tax reform, international tax competition, and the economic burden of government spending. He also serves on the editorial board of the Cayman Financial Review. This article was originally published on FEE.org. Read the original article. Follow libertyLOL on your favorite social media sites:FacebookYoutube Tumblr Pintrest Countable: Government Made Simple Steemit blog on a blockchain Patreon Gab.ai libertyLOL's Liberty Blog RSS Feed We also run a couple twitterbots which provide great quotes and book suggestions: Murray Rothbard Suggests Tom Woods Suggests Jason Stapleton Suggests Progressive Contradictions MORE FROM LIBERTYLOL:
There is so much wrong with the American healthcare system. It is hobbled by mandates, subsidies, price controls, and every manner of middleman standing between you and what you want. Fixing all of this – and the bad regulations date back decades if not a full century – requires far more political courage that D.C. has mustered in my lifetime. Or we could just take the easy route: let insurances offer to willing buyers whatever kinds of healthcare they want. I explain this in the video below. There were many bad features of Obamacare, as people are now fully discovering. It combined a mandate that insurers not discriminate against preexisting conditions with community pricing, factors which caused the so-called death spiral. It put too many restraints on competition across geographic lines. It imposed what amounts to a new tax. But one of the worst features is hardly mentioned. It prepackaged what precisely must be insured, and allowed no room for flexibility. This is one reason premiums rose so much so fast. Insurers simply tallied up the benefits and the risks and dished out new terms. You had no choice in the matter. We don't do this in any other part of life. If you go to McDonald's and ask for fries, they don't say, "Sorry, we can't sell those separately. You have to buy the double Quarter Pounder Value Meal with a dessert, or else we can't sell you anything." My proposal is simple. Get rid of the government mandates over what can and cannot be part of what is called health insurance. Let consumers and insurers get together and decide this for themselves. This would immediately create a variety of new lower-priced options. I explain more below.
Matthew B. KibbeMatt Kibbe is a leading advocate for personal, civil and economic liberties. An economist by training, Kibbe is a public policy expert, bestselling author and political commentator. He served as Senior Advisor to Concerned American Voters, a Rand Paul Super PAC. He is also Distinguished Senior Fellow at the Austrian Economic Center in Vienna, Austria. He is a member of the FEE faculty network and cooperates in running Free the People.
This article was originally published on FEE.org. Read the original article. How the Left's Racial Politics BackfiredGet out the Doritos. Pop the top on your Bud Light. Go down to your man cave, plop down on your La-Z-Boy, invite your friends over and turn on the Packers game. Normally, white people just don't think much about race. But they are now surrounded by a culture obsessed with both race and gender. Here come the White people. CNN commentator Van Jones, clearly upset by the results coming in last night, claimed that Democrats got “White-lashed.” In a way, he was right. But he has only himself to blame. The problem with liberals is that they want all the advantages of racial politics and none of the detriments. They have succeeded in weaponizing entire racial groups, but when they find that they have inadvertently weaponized the ones who vote the other way, they get upset. Nate Cohn at the New York Times said something interesting about Trump's win to which everyone should pay careful attention. He said that “white working class voters just decided to vote like a minority group. They're [over] 40% of the electorate.” The White Minority In a sense, I think a large part of Donald Trump's vote consisted of people who felt like saying, “You want racial politics? We’ll give you racial politics!” These people are not racist. They’ve got too many other issues to deal with that really matter. Under normal circumstances, white people just don't think very much about race. They have always been the default ethnic group, so they've never had to think about race. But they are now surrounded by a culture obsessed with both race and gender. And they are regularly lectured by the liberal elites who just got spanked at the polls that they should think about it all the time. Black Lives Matter, but your little White honky life is politically meaningless. Go help your children finish their Black History Month coloring assignment from school and shut up. And don't even think about touching that Peach crayon. If your finger even touches anything lighter than Burnt Sienna we'll cut it off. This is what many Whites think they hear. They may be wrong or right, but that is beside the point. And when other things in their lives make them feel undervalued—the loss of their manufacturing job, the collapse of their marriage, the effect of drugs on their family, the bad schools their kids have to go to—when this is the reality of their lives, then watching television and hearing about how everyone except you deserves more attention and assistance becomes just a little hard to bear. And when you are forced toward sentiments you don’t really think you should have by a self-righteous cultural establishment that is always telling you how you should feel, you tend to get a little cranky, and when you get cranky you end up as the beer frame at the bowling alley. And you take it out on someone who represents this establishment at the polls. The problem is that when Whites are forced to think about race, they are also forced to act like a minority. So Hillary did serve some purpose. Just look at where Trump was the strongest: in the Appalachias and the rust belt. There’s a reason J. D. Vance, author of Hillbilly Elegy, is the man of the hour. It is he who has presented the liberal Democrats with their causa mortis. He’s the one who, by mere reflection on the plight of the White middle and underclass—and its underappreciation—did more to predict what happened yesterday than all the sophisters and calculators manipulating the polling data. Race did play a role in Trump's win, but not in the way that the liberal media thought. Through their control of what Richard Weaver called the “great stereopticon”—the media construct by which we are all propagandized—we are told that we should think about race and gender everywhere all the time. The problem is that when Whites are forced to think about race, they are also forced to act like a minority—as Cohn points out, a very large one. The problem here is that the result is almost exactly the opposite of what the purveyors of racial politics intended. Quite frankly, it serves them right. And when you add gender into the mix, it becomes nitro to the racial glycerin. Liberal Democrats victimized themselves on election night. They need to think harder about whether they really want the kind of culture they have been trying to create: one divided along lines of race and gender. What they found out on election night is that it doesn't always work to their advantage. Republished from Intellectual Takeout. Martin CothranMartin Cothran, the author of Memoria Press’ Traditional Logic, Material Logic and Classical Rhetoric programs, is an instructor of Latin, Logic, Rhetoric, and Classical Studies at Highlands Latin School. This article was originally published on FEE.org. Read the original article. MORE FROM LIBERTYLOL:
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 TheoryThis 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. Bad Theory 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 TuckerJeffrey 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. More from LibertyLOL:
Aside from Lindsay Graham, John McCain could be the largest lobbyist of US-led violence around the world. He has never met a conflict he didn't like. Jason Stapleton warns us that guys like these have only one motive. Grease the palms of their military industrial complex in every way possible so they can then turn around and support them for reelection.
Listen here: More From LibertyLOL:“If Hitler were to invade Hell, I would at least make a favorable reference to the Devil in the House of Commons.” — Winston Churchill. In Churchill’s estimation, Stalin was less evil than Hitler. Hence, the Allied Forces’ brief friendship with the Soviets: a marriage of convenience formed in Hell. The Right to Complain. Every four years, Americans face the so-called lesser-of-two-evils (LOTE) dilemma: “Both major-party presidential candidates are lousy, but I’m duty-bound to vote. Free people get to complain.Plus, those who don’t vote can’t complain!” First, why can’t I not vote and complain, all at the same time? I rather enjoy complaining, and complaining about politics can be quite fun. Cathartic, even. The way I see it, my right to complain about the government that taxes me by coercion, and threatens to jail me when I reach the age of majority should I fail to complete a draft card, is not purchased by my quadrennial vote for one authoritarian statist, or the other. I am already a free person, regardless of whether I cast a vote. And free people get to complain. In fact, maybe I’ll vote for a candidate and still complain about them once they are in office. I am just that wild and crazy! Is LOTE Your Only Argument? “Okay, complain. But we should still vote for the LOTE because the country hangs in the balance! Plus, like the ancient Chinese proverb says: If we keep picking the lesser of two evils, things will probably stop being evil, eventually.” Every ballot should include a “None of the Above” option. Because truthfully, this is how the majority of eligible voters feel on election day. That’s probably not an ancient Chinese proverb. But I think it speaks volumes about the presidency that LOTE is the default position for most of the 50% of eligible voters who actually vote. Maybe this is because most people are instinctively uneasy about picking a national leader. Of course, the original job description called for a citizen-executive-officer of one branch, of a limited, constitutional republic. This certainly carries a lower expectation than the current job description, which is on the order of Pontifex Maximus. Moreover, our expectations about who should fill this awesome role is matched only by our emotional intensity over the decision. Most of us don’t get emotionally invested when voting for County Recorder, or Grand Marshal of the local parade. But the presidency is deeply personal, because the role is ubiquitous. Why, the president is our great national father, mother and spiritual leader! Also, voting the “wrong” way can draw the censure of friends and family, and destroy relationships. (So, holding presidential elections right before Thanksgiving is a super idea.) Is it any mystery why half of the eligible voters are driven toward apathy? The presidency has become a title no human deserves to fill, and few voters are fully comfortable bestowing. I predict voter turnout would return to 19th century highs if the presidency (and the federal government) returned to its 19th century (constitutional) scope. Until then, every ballot should include a “None of the Above” option. Because truthfully, this is how the majority of eligible voters feel on election day. Besides, when President X starts pounding the “bully pulpit” on behalf of “the American people” to sell some war, or some new domestic agenda, it would be fitting to remind the president of how a majority of “the American people” actually felt in the prior election. A Moral Duty to Vote? It should go without saying that there is no legal duty to vote. Yet, how often are we hectored for not voting (or voting third party)? Indeed, what kind of misanthrope sits idly by while the country hangs in the balance!? And don’t you know that Literally Hitler is running this year? Not to dismiss the harm that can be – nay, will be done by any incoming president. And I actually agree that some candidates are relatively worse than others. I am also no sanguine optimist about the triumph of third-parties. Let’s be honest, there are two major parties and one will win the presidency. Yes, voting third-party has purposes. It’s just that none of those purposes includes actually winning the presidency. But whether one is reasonable in choosing to vote for the LOTE, is not the same as being duty-bound. And while I can’t speak for everyone, I know Christians are not exactly permitted to “choose” any kind of evil. LOTE – whatever else it may be – is not really a moral doctrine. At least, not in the Western or Christian tradition. Although, it does sound like the Principle of Double Effect (PODE). Saint Thomas Aquinas set forth PODE, thusly: An act or omission having a foreseen harmful effect, that is inseparable from its good effect, is morally justified if: (a) The nature of the act or omission is good or morally neutral; (b) the agent intends the good effect, and not the bad effect (either as a means to the good, or an end in itself); and (c) the good effect outweighs the bad effect, and the agent takes all steps to minimize the bad effects. Thus, again, one may be permitted to make choices having double-effects, while not being duty-bound to make such choices. Civic Duty and the Common Good. One could say abstaining (or voting third-party) constitutes a dereliction of one’s duty toward the “Common Good.” At what point is one’s duty to advance the Common Good through voting, rendered untenable?Many Christian and secular philosophers have articulated a duty to advance the so-called Common Good through civic engagement – thus, one is said to be duty-bound to vote, pay taxes, and serve in juries. Even accepting this premise, it is not clear that the Common Good (however defined) is always, and in every case, advanced by voting. For instance, many would agree that one’s cooperation with a civic institution is conditioned on the institution’s deference to a higher, Natural Law. Even Romans 13 – the Biblical passage oft cited as the basis Christian civic duty – implicitly conditions these duties on the authority’s service to God. In other words, the authority, and the law, must be legitimate. At what point is one’s duty to advance the Common Good through voting, rendered untenable as a result of unjust laws, or authorities acting ultra vires? Notice, this is precisely the moral justification behind the Civil Rights movement – people of moral conscience abstained from obeying authorities inasmuch as the authorities, and the laws, contradicted a higher, Natural Law. Civil Rights Activists were not callously disregarding all law and authority out of convenience. They were very much cooperating with the Common Good, by rejecting oppressive civic institutions. So, if the system produces two monsters to serve as president, either of who will advance an ultra vires agenda in office, can it truly be said that I have a moral duty to pick one? Arguably, might my abstention, or third-party vote, be in furtherance of the Common Good? To Vote, or Not Vote. Every eligible voter will have to decide, based on his or her own conscience, whether the Common Good compels voting for the LOTE. Each will have to assess the relative moral harm of the candidates, based on their own values. At the very least, there are sound moral arguments for a third-party vote. And abstention means “None of the Above.”
Robert ColemanIs a Berkeley alumni and Pepperdine Law graduate, and General Counsel for a national corporation. This article was originally published on FEE.org. Read the original article. "Get the equivalent of a Ph.D. in libertarian thought and free-market economics online for just 24 cents a day." Most of us learned politically correct U.S. history in school. The economics was at least as bad. It's never too late to learn the truth. At Liberty Classroom, you can learn real U.S. history, Western civilization, and free-market economics from professors you can trust. Short on time? No problem. You can learn in your car. FIND OUT MORE HERE More from LIbertyLOL:
I was first interested in Rules for Radicals when I saw the image above. This is exactly what we have seen over the past 40 years so I decided to read the book. I wanted to be able to better identify when its strategy was used against the American people. Also, I wanted you to save ten hours of your life. You're welcome. Main salient points to follow:
So how do we combat this effective progressive agitation? Our first weapon is information. Call it out when we see it. Call out the immoral tactics. Call out the abuse of inaccurately creating social problems. Call out the divisive nature of media and government along social, racial, class and religious lines. Call out biased news reporting and holding the 4th branch of government accountable to facts and logic. If you want to read more, check out Barack Obama's Rules for Revolution by David Horowitz below. Also Six Alinsky Rules That Explain Obama’s Words and Deeds located here.
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While Lobbying in and of itself is not illegal, it's effects on the free market can be damning. A recent commenter wanted more information on what exactly the FDA did to assist Mylan in achieving monopoly status.
First we have to follow the money. We start when Mylan began pouring money into lobbying efforts and then look to pinpoint what effects they achieved. OpenSecrets.org is a primary repository to track campaign contributions to elected officials and candidates, companies, labor unions, and other organizations that spend billions of dollars each year to lobby Congress and federal agencies. Check out Mylan's page here. In 2007 the Mylan bought the rights to EpiPen, so we'll start there. Though it might be coincidental, their primary lobbying efforts began after the acquisition of Epipen, a four-fold increase from 2007-2008. Mylan's primary efforts went to bills such as:
Well, not exactly. A deeper look into these bills reveals that it made it even harder for generics to compete. The rules that Mylan lobbied for included the requirement that all Epipens be sold in packs of two, vice one. This expanded the volume of goods sold. A rule was inserted that required Epipens be prescribed for at-risk patients, not just those with confirmed allergies. This expanded the number of consumers to which the product could be marketed to. Rules were inserted which required public schools to maintain a stock of Epipens on hand, again, creating a market nationwide where it did not exist. No marketing or sales department necessary. Generics not approved by the FDA were not an approved item for school usage, thus preserving a monopoly throughout school districts nationwide. In 2013 the government passed a law giving block grants to the states to pay for the required stock in public schools. This effectively passed on all the costs of the previous rules to the taxpayers. Keep in mind, this is quite costly as the EpiPen only has a shelf life of about 12 months and must be replaced quite often. Once the FDA loosened health insurance rules on the usage of epipens, Mylan was emboldened to continue raising its prices because now the consumer didn't have to pay for it, the costs were passed on to the insurance companies. This phenomenon is called that the Third-Party Payer Problem and is an important concept to understand when trying to determine why health care prices rise. Mises.org wrote this morning that the problem isn't so much the dose, which is cheap, but the applicator: Epinephrine is extremely cheap—just a few cents per dose. The complications come from producing the easy auto-injecting devices. Mylan “owns” their auto-injector device design, so competitors must find work-arounds in their devices to deliver the epinephrine into the patient’s body. This task, coupled with the tangled mess of FDA red tape, has proven to be difficult for would-be EpiPen competitors. It’s like expecting somebody to come up with a new way to play baseball without bases, balls, gloves, or bats, but still getting the game approved by the MLB as a baseball game substitute. So why can't competitors compete? They've tried but the FDA red tape is a true obstacle. In March 2016, Fierce Pharma reported "FDA swats down Teva's EpiPen copy, putting Mylan in cruise control". Teva won't now be able to appeal and relaunch until 2017. The Pharmacy Times reported in 2010 that there were 3 brands of epinephrine auto-injectors are available on the market—EpiPen Auto-Injector, Adrenaclick, and Twinject. Adrenaclick, Twinject, and the authorized generic to Adrenaclick have an FDA Orange Book rating of “BX,” indicating that insufficient evidence exists to determine therapeutic equivalence. This rating indicates that these epinephrine auto-injector products are not therapeutically equivalent to each other. For example, the other products should not be substituted and dispensed when EpiPen Auto-Injector is prescribed, unless the prescriber is consulted and agrees to change the prescription. As a liberty-minded person, I believe that you can charge whatever you want for your product and for the fruits of your labor. But that assumes there is a free-market where a competitor can come along with market efficiencies and increased value and convenience for the customer and undercut you. The rest of this post is provided as information and without editorial.
Proxy filings show that from 2007 to 2015, Mylan CEO Heather Bresch's total compensation went from $2,453,456 to $18,931,068, a 671 percent increase. During the same period, the company raised EpiPen prices, with the average wholesale price going from $56.64 to $317.82, a 461 percent increase, according to data provided by Connecture.
"If you look at the facts here, when Mylan controls 85 percent of the market, to quote Bloomberg News, and they had this monopoly power drop in their laps and they went for it - that's what I see," she says. "They say they've made some improvements, but there's no way their improvements should be five times more the value of the item itself." mORE FROM lIBERTYlol: |
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