Much has been made of Liberal leader Justin Trudeau's promise to legalize marijuana. The exact specifics of his plan have not been laid out. Politicians are always reluctant to spell out in great detail what they propose since vague statements can be interpreted by the audience to mean whatever they want to them to mean but exact details can provoke opposition. While advocates of legalization have often brought up the refrain of 'legalize, tax and regulate' there is an alternative approach, which is simply to legalize. After all, why is it our purpose to increase state revenues? These revenues will after all be spent on new counterproductive schemes to control the economy and loot us of our hard earned wealth. And why should we subject the blossoming marijuana industry to regulations which, through the imposition of high fixed costs, will cripple the ability of smaller firms to compete with established business interests? What about the alternative - to eliminate the criminal penalties for production, distribution and cultivation but leave the newly created legal market in pot unregulated and untaxed. Why not have a free market in ganja?
To be certain, marijuana should be legalized. In fact, the Canadian government should declare unconditional surrender in the war on drugs. All drugs should be legal. After all, if an individual owns their body, shouldn't they have the right to put in it whatever they please? And even though drugs may be harmful, hasn't more harm been caused by this war? What of the damage to our rights against unlawful search and seizure? What about all of the crimes against person and property which have gone unsolved because scarce police resources were squandered in this vain effort to keep addicts from using and dealers from selling? And what about all of the drug dealers languishing in prison and all the prison guards needlessly employed keeping them there? If there were no war on drugs then their entrepreneurial talents would be redirected towards some other satisfaction of consumer demand. While it is common to demonize these men and women who have dared to defy state edicts, the reality is that drug dealing is a victimless crime. These people aren't evil; they are simply out to make a buck. And why not? If anything they are heroic for risking their lives and freedom to bring consumers want they want.
Even in the event that Trudeau is elected and he keeps his promise and legalizes pot, no doubt what would see in the legal marijuana market is what we see in other markets and in the present legal medical marijuana industry. Regulations that protect a few established firms from competition. A highly regulated, highly taxed, uncompetitive market for the benefit of a tiny elite. Thanks but no thanks; better the money go to some kid who is slanging than the crony of a politician.
So absolutely, let's legalize, but instead of of taxing and regulating, why not try freedom?
Saturday, August 29, 2015
the inexorable growth of the state
There are different ways to define the government. Oppenheimer defined the state as the organization of the political means. There are two ways to obtain wealth. The first method is to produce or trade for it; this is the economy means. The second method is to avoid the work of production and simply to take what another has created. This is the political means. Weber defined the state as a territorial monopolist of violence. But another key distinction of government is it's monopoly on arbitrage and decision making.
The problem with the limited government view is that once an organization has been granted a monopoly on arbitrage there is simply no method of checking the inexorable growth of it's power. People love power and will usually decide to aggrandize their own or that of an organization which they are a part of. Which is not to say, for those who oppose the state and it's perpetual violence, that there is no hope. Ideology can trump self interest and we should never neglect the role that ideas play in shaping history. But it is also important to examine whether the particular means of those who are opposed to an ever expanding state are suitable for their ends of limiting government.
The solution, then, is to allow for free competition in arbitrage and judicial decisions. Instead of promoting a state monopoly in justice allow for a market in legal decisions. One common objection to this idea is that it will make justice be for sale to the highest bidder. But there is little demand for a judge who can be bought; his decisions will not hold much weight with other parties. The most widely sought after jurists would be those who are the fairest. And while the present legal system is costly, inefficient and painfully slow, there would be incentives in a legal market to provide cost effective and quick solutions. The cost of participating in the state's legal system can be so expensive that vexatious litigants can use the threat thereof against wealthy organizations as a means to a quick payday. And it is not as if judges today are entirely above bribery anyway.
The question of exactly what a form a market in justice might take is an interesting academic exercise but not necessarily one which can be answered. No doubt what would develop over time would be combination of theory and practice as practices which worked were adopted and those which didn't were discarded, much like the tradition of common law itself. As for verdicts being enforced without the state, certain courts may demand assets might be held in escrow for the participation of parties and David Friedman points out the emphasis of the discipline of repeat dealings. An organization which routinely thumbed their nose at legal rulings would suffer a loss of reputation and would lose their ability to settle disputes legally as other organizations would refuse to go to court with them.
The inefficiencies of areas of the economy monopolized by the state have been observed and decried for centuries now. Isn't it time we let market competition work in one of the most vital areas of human endeavours?
The problem with the limited government view is that once an organization has been granted a monopoly on arbitrage there is simply no method of checking the inexorable growth of it's power. People love power and will usually decide to aggrandize their own or that of an organization which they are a part of. Which is not to say, for those who oppose the state and it's perpetual violence, that there is no hope. Ideology can trump self interest and we should never neglect the role that ideas play in shaping history. But it is also important to examine whether the particular means of those who are opposed to an ever expanding state are suitable for their ends of limiting government.
The solution, then, is to allow for free competition in arbitrage and judicial decisions. Instead of promoting a state monopoly in justice allow for a market in legal decisions. One common objection to this idea is that it will make justice be for sale to the highest bidder. But there is little demand for a judge who can be bought; his decisions will not hold much weight with other parties. The most widely sought after jurists would be those who are the fairest. And while the present legal system is costly, inefficient and painfully slow, there would be incentives in a legal market to provide cost effective and quick solutions. The cost of participating in the state's legal system can be so expensive that vexatious litigants can use the threat thereof against wealthy organizations as a means to a quick payday. And it is not as if judges today are entirely above bribery anyway.
The question of exactly what a form a market in justice might take is an interesting academic exercise but not necessarily one which can be answered. No doubt what would develop over time would be combination of theory and practice as practices which worked were adopted and those which didn't were discarded, much like the tradition of common law itself. As for verdicts being enforced without the state, certain courts may demand assets might be held in escrow for the participation of parties and David Friedman points out the emphasis of the discipline of repeat dealings. An organization which routinely thumbed their nose at legal rulings would suffer a loss of reputation and would lose their ability to settle disputes legally as other organizations would refuse to go to court with them.
The inefficiencies of areas of the economy monopolized by the state have been observed and decried for centuries now. Isn't it time we let market competition work in one of the most vital areas of human endeavours?
the cleansing of pro palestinian sentiment in the NDP
There is not much to recommend the New Democratic Party. On economic policy they are dismal. When it comes to advancing the anti-human, anti-prosperity environmentalist agenda, they are second to none. Their agenda of tax hikes and spending increases demonstrates a level of stupidity which Canada's other major political parties has never quite managed to meet. Even on foreign policy they are far too protectionist and to needlessly eager to involve Canadian soldiers in peace keeping missions. But at least, AT LEAST!, on the issue of Palestine they had some sense. Alas, under the leadership of Mulcair, this last vestige of opposition to the war party's agenda in the middle east has been swept away.
From Clyde River, to Halifax, from Edmonton to Calgary, the party leadership is cleansing it's slate of any who dared to speak against the Israeli conquest and occupation of Palestine. This slap in the face to party loyalists is a clear signal that Mulcair as Prime Minister would pose no threat to the military industrial complex or the policy of western imperialism. It's not surprising that the opportunist Mulcair, leading in the polls would and no doubt salivating at the prospect of becoming the next Canadian head of state, would join Trudeau and Harper in kowtowing to Israel; politicians will do or say anything if they think it will help them gain power.
Libertarians in Canada have long since recognized that the differences between establishment political parties are very superficial. Perhaps it's appropriate that the NDP join the ranks of Canadian Israeli apologists. There is a broad social democratic consensus on the part of all "right thinking indivduals" on the importance of social spending, dirigism, environmentalism and the silencing of free speech in the name of human rights. Why not extend this hegemonic viewpoint to imperialism and support for Israel? For that matter, why even bother having different political parties at all, if they are all going to advocate for the same policies and ideas? Why not just merge the NDP, Liberals, Greens and Conservatives into one grand party of social democracy? At least that would be more honest than vigorously promoting the same ideas under different rhetoric to create the illusion of choice.
Friday, August 28, 2015
borrow to build roads?
The latest media buzz surrounding the federal election is Trudeau's pledge to run deficits to finance infrastructure spending, echoing the Wynne plan in Ontario. Those in favour of "road socialism" (which is to say, everybody) really have no answer to this proposal except to echo it enthusiastically. After all once you accept that only the state can or should build bridges, highways etc. then how can you dispute that we need more of them? But do we? How exactly does one determine how much infrastructure should be created and where?
The etatist answer is to relegate this task to some central planning committee or bureaucrat, who will then diligently assess the situation and come up with some answer on the basis of traffic flows, political needs or whatever. The answer of the anarcho-capitalist is that you should privatize infrastructure and then the price system will reflect consumer demand and direct scarce resources to their most efficacious ends. All goods are in competition with other goods for the requisite capital, labour and land which is required for their production. More roads becomes less cars of factories or less whatever other good.
The 20th century witnessed the repudiation of the collectivist central planning ideology. The soviet union was perhaps the ultimate embodiment of this belief system and it collapsed because ultimately socialism does not work. But just as the market economy is more suitable for the production of housing, automobiles and food, so it is the best means of providing roads, medicine and security. Indeed, the more vital the industry the more important it is that it be privatized. Let the state have a monopoly on the sale of alcohol, for example, but let education and health care be supplied by a market.
Given the present paradigm it could very well be that the federal government should spend more money on infrastructure. The libertarian position on this issue is to be agnostic. Without a legitimate price structure it's unanswerable. The best guess of a bureaucrat is a poor substitute for the catallactic expression of consumer demand which would occur in a market. The libertarian position on infrastructure spending is simply to privatize the roads and highways. The advantages would be legion. Higher prices charged during peak times would work to ease the gridlock which plagues major urban areas and competition between road companies would serve to promote innovation in road safety. Infrastructure firms would have an incentive to monitor their roads and ban drunk or careless drivers since safer roads would be a strong advertising point. If a company were as blasé about potholes as municipal governments are they would quickly find consumers choosing to drive on more manicured pavements.
But on the question of whether or not deficits brought upon by an increase in government spending are good for the long term health of the economy there can be no question they are not. Public sector spending and the taxes it entails hamper economic growth. If the deficit is financed through bond sales to the banking system then it is inflationary as well, and this has it's own pernicious effect on the wealth of the nation. During both boom and bust the best approach for the health of the economy is to reduce spending and cut taxes to allow the private sector room to grow.
The etatist answer is to relegate this task to some central planning committee or bureaucrat, who will then diligently assess the situation and come up with some answer on the basis of traffic flows, political needs or whatever. The answer of the anarcho-capitalist is that you should privatize infrastructure and then the price system will reflect consumer demand and direct scarce resources to their most efficacious ends. All goods are in competition with other goods for the requisite capital, labour and land which is required for their production. More roads becomes less cars of factories or less whatever other good.
The 20th century witnessed the repudiation of the collectivist central planning ideology. The soviet union was perhaps the ultimate embodiment of this belief system and it collapsed because ultimately socialism does not work. But just as the market economy is more suitable for the production of housing, automobiles and food, so it is the best means of providing roads, medicine and security. Indeed, the more vital the industry the more important it is that it be privatized. Let the state have a monopoly on the sale of alcohol, for example, but let education and health care be supplied by a market.
Given the present paradigm it could very well be that the federal government should spend more money on infrastructure. The libertarian position on this issue is to be agnostic. Without a legitimate price structure it's unanswerable. The best guess of a bureaucrat is a poor substitute for the catallactic expression of consumer demand which would occur in a market. The libertarian position on infrastructure spending is simply to privatize the roads and highways. The advantages would be legion. Higher prices charged during peak times would work to ease the gridlock which plagues major urban areas and competition between road companies would serve to promote innovation in road safety. Infrastructure firms would have an incentive to monitor their roads and ban drunk or careless drivers since safer roads would be a strong advertising point. If a company were as blasé about potholes as municipal governments are they would quickly find consumers choosing to drive on more manicured pavements.
But on the question of whether or not deficits brought upon by an increase in government spending are good for the long term health of the economy there can be no question they are not. Public sector spending and the taxes it entails hamper economic growth. If the deficit is financed through bond sales to the banking system then it is inflationary as well, and this has it's own pernicious effect on the wealth of the nation. During both boom and bust the best approach for the health of the economy is to reduce spending and cut taxes to allow the private sector room to grow.
Anarcho capitalism is impossible?
Anarcho capitalism is impossible?
The anarcho-capitalist viewpoint it simple. Aggression is wrong. Theft is wrong. Property rights exist and the state should not. While the development of this philosophy was thousands of years in the making and traced a tortured route through early Chinese and Greek philosophers, past the early Christian church, onto the liberal reaction against Absolutism in Europe in the 17th and 18th century and finally culminating in the social views of the Austrian school in North America it's basic axioms are elegant in their simplicity.
The anarcho-syndicalist viewpoint is equally simple but mired in contradictions. Capitalism is evil. Property is theft. The state should not exist. But if there is no state then who is to oversee the common store of goods? Who is to determine if one is shirking or doing one's fair share? Necessarily a workers council must control the commonly owned property; behold the state. If property is theft, what then about personal possessions? Can I not own a toothbrush of my own? Clothing of my own? Behold, private property.
Syndicalism also suffers from a calculation deficit. Without a price system derived from economic calculation, how is it determined how much iron or buttons or widgets are produced? While the solution of state communism to this problem is woefully inadequate, they at least attempt such a solution. Sowell estimates the Soviet Union had 34 million different prices to be set. How can a syndicalist society determine what should be produced without these prices? The price system effortlessly coordinates the activities of people across the globe to produce that which is most urgently desired by consumers. Without it, how are you to prevent or correct a glut in good A or a shortage in good B?
The question of national defense in a society without a state is an important one. How precisely would the threat of foreign invasion be handled? Perhaps an army would be organized in peacetime on the basis of a charity, with broad reservist ranks and voluntary donations for funding. Perhaps nuclear weaponry would be obtained and used to threaten bellicose neighbours (although given that A's aggression against B does not justify B's aggression against C it is difficult to reconcile a libertarian ideology with the use of a nuke). Perhaps diplomacy and luck (friendly neighbours) would do the trick, as in the case of say a North American or European anarcho-capitalist nation. Ultimately we can offer only conjecture as to how the demand for national security would work. But an anarcho-capitalist nation would have certain advantages when it came to national defense. A policy of open borders would attract immigrants and a larger population base will allow for a larger army. Laissez-faire has proven historically to lead to rapid capital accumulation and a strong industrial base can be converted into the production of armaments. Free market capitalism contributes to the rapid development of new technology and so, certeris paribus, a libertarian society would be a more advanced society, and this will translate into a more advanced military. One thing can be certain, the rapidly disintegrating economic structure of a anarcho-socialist state would leave such a nation in very poor shape to handle foreign conquerors.
People would still be able to get obscenely rich without a state; the main difference would be that fortunes could only be made by providing consumers with what they most urgently desire. The state is systematic plunder; the market is peaceful social cooperation. While government is justified on the basis of security and protecting private property in reality it is simply a criminal conspiracy on the part of the political class to loot the economic class. Far from protecting private property the state constantly aggresses against it. It would be far easier for the greatest entrepreneurs to accumulate wealth if they did not have to submit constantly to state plunder and jump through bureaucratic hoops. But laissez-faire means prosperity not only for the elite but also for everyone else. Historically societies which have most closely approximated laissez-faire have also seen standards of living rise very quickly for everyone, including the poorest of the poor. Without the state to seize and redistribute a significant portion of the national product there would be a far greater investment in capital. Without the government's mangling of the money supply it would be far easier for people to save, meaning a greater supply of loanable funds for enterprise to borrow and grow. A sound monetary system would mean an end to the boom-bust business cycle and the constant dislocation brought about by artificial interest rates. Without a bellicose foreign policy there would be more resources for domestic production. Without the regulatory regime free enterprise would more easily flourish. Everything the state does retards innovation, suppresses economic growth and leads to poverty. How can one imagine that the cost of private policing could be anything comparable to the taxes demanded by the modern omnipotent state?
The state, the organization of the political means, is a monster. The state is violence. But abolishing this institution of evil and replacing it with socialism would be jumping out of the frying pan and into the fire. There have been countless experiments in the 'common store' of goods, all of them ending in abject failure, misery, poverty and tyranny. History is replete with the graves of those who have been victimized by this idea. The state is evil; capitalism is great.
The anarcho-capitalist viewpoint it simple. Aggression is wrong. Theft is wrong. Property rights exist and the state should not. While the development of this philosophy was thousands of years in the making and traced a tortured route through early Chinese and Greek philosophers, past the early Christian church, onto the liberal reaction against Absolutism in Europe in the 17th and 18th century and finally culminating in the social views of the Austrian school in North America it's basic axioms are elegant in their simplicity.
The anarcho-syndicalist viewpoint is equally simple but mired in contradictions. Capitalism is evil. Property is theft. The state should not exist. But if there is no state then who is to oversee the common store of goods? Who is to determine if one is shirking or doing one's fair share? Necessarily a workers council must control the commonly owned property; behold the state. If property is theft, what then about personal possessions? Can I not own a toothbrush of my own? Clothing of my own? Behold, private property.
Syndicalism also suffers from a calculation deficit. Without a price system derived from economic calculation, how is it determined how much iron or buttons or widgets are produced? While the solution of state communism to this problem is woefully inadequate, they at least attempt such a solution. Sowell estimates the Soviet Union had 34 million different prices to be set. How can a syndicalist society determine what should be produced without these prices? The price system effortlessly coordinates the activities of people across the globe to produce that which is most urgently desired by consumers. Without it, how are you to prevent or correct a glut in good A or a shortage in good B?
The question of national defense in a society without a state is an important one. How precisely would the threat of foreign invasion be handled? Perhaps an army would be organized in peacetime on the basis of a charity, with broad reservist ranks and voluntary donations for funding. Perhaps nuclear weaponry would be obtained and used to threaten bellicose neighbours (although given that A's aggression against B does not justify B's aggression against C it is difficult to reconcile a libertarian ideology with the use of a nuke). Perhaps diplomacy and luck (friendly neighbours) would do the trick, as in the case of say a North American or European anarcho-capitalist nation. Ultimately we can offer only conjecture as to how the demand for national security would work. But an anarcho-capitalist nation would have certain advantages when it came to national defense. A policy of open borders would attract immigrants and a larger population base will allow for a larger army. Laissez-faire has proven historically to lead to rapid capital accumulation and a strong industrial base can be converted into the production of armaments. Free market capitalism contributes to the rapid development of new technology and so, certeris paribus, a libertarian society would be a more advanced society, and this will translate into a more advanced military. One thing can be certain, the rapidly disintegrating economic structure of a anarcho-socialist state would leave such a nation in very poor shape to handle foreign conquerors.
People would still be able to get obscenely rich without a state; the main difference would be that fortunes could only be made by providing consumers with what they most urgently desire. The state is systematic plunder; the market is peaceful social cooperation. While government is justified on the basis of security and protecting private property in reality it is simply a criminal conspiracy on the part of the political class to loot the economic class. Far from protecting private property the state constantly aggresses against it. It would be far easier for the greatest entrepreneurs to accumulate wealth if they did not have to submit constantly to state plunder and jump through bureaucratic hoops. But laissez-faire means prosperity not only for the elite but also for everyone else. Historically societies which have most closely approximated laissez-faire have also seen standards of living rise very quickly for everyone, including the poorest of the poor. Without the state to seize and redistribute a significant portion of the national product there would be a far greater investment in capital. Without the government's mangling of the money supply it would be far easier for people to save, meaning a greater supply of loanable funds for enterprise to borrow and grow. A sound monetary system would mean an end to the boom-bust business cycle and the constant dislocation brought about by artificial interest rates. Without a bellicose foreign policy there would be more resources for domestic production. Without the regulatory regime free enterprise would more easily flourish. Everything the state does retards innovation, suppresses economic growth and leads to poverty. How can one imagine that the cost of private policing could be anything comparable to the taxes demanded by the modern omnipotent state?
The state, the organization of the political means, is a monster. The state is violence. But abolishing this institution of evil and replacing it with socialism would be jumping out of the frying pan and into the fire. There have been countless experiments in the 'common store' of goods, all of them ending in abject failure, misery, poverty and tyranny. History is replete with the graves of those who have been victimized by this idea. The state is evil; capitalism is great.
Thursday, August 27, 2015
yo notley : spending cuts the best medicine for ailing albertan economy
The Notley government has decided to delay their budget until the end of October, perhaps to save Mulcair and his merry gang of mensheviks the embarrassment of explaining away her 7 billion dollar shortfall while campaigning on the promise of eliminating the federal deficit. With the energy sector struggling under low oil prices and oil & gas being such an integral part of the economy in Alberta, how should Notley best handle this situation in her inaugural budget?
Spending Cuts
The best thing the government can do when the economy is struggling is cut taxes and cut spending. This gives the private sector, the engine for economic growth, room to recover. Where to cut? Anywhere and everywhere; the deeper and broader the cuts the better. Privatize and downsize. Cut funding to post secondary education, for seniors, cut the salaries and ranks of bureaucrats, cut the oil royalties, auction off parks and stop government advertising.
The deeper the cuts in spending and taxes the more wealth will remain in the private sector. The market economy is a positive sum game. People only trade when they expect to benefit, and in the vast majority of cases their expectations are realized. While errors can occur on the route between ex ante and ex post, these are rare, the exception not rule. There is an immediate feedback mechanism. If you make a lousy trade you recognize this and don't do it again. The state, by contrast, is win / lose. One individual or group benefits only to the extent that another suffers. Government is a negative sum game, as state expenditures are not directed towards the highest ranking ends of the people the money is spent on. Instead government spending is the consumptive decisions of bureaucrats.
An additional benefit to deep spending cuts is that the government employees who become unemployed by this course of action would have no recourse but to find more gainful employment in the private sector, switching from burden to benefactor. Coupling the spending cuts with meaningful tax relief would draw in foreign investment, always eager to find a jurisdiction free of confiscator tax rates and would enable consumers to more easily save and invest. Savings are critical for long term economic growth since firms borrow this money to purchase capital.
Unfortunately it is very unlikely that those who are ideologically committed to their dirigiste view of the state are going to find religion sometime during the next two months and Albertans will have to suffer under a status quo budget of profligate government spending and tax hikes. C'est la vie.
Wednesday, August 26, 2015
a bad tax credit
One of the axioms of the libertarian credo is that there is no such thing as a bad tax credit. While some right wing politicians may talk about 'simplifying the tax code' those of us in the freedom movement understand that this is a euphemism for raising taxes. The myriad exceptions written in to the code represent successful efforts by some to alleviate their tax burden and we should celebrate this achievement whenever it occurs. There is no such thing as a bad tax credit; so leave it to Justin Trudeau and his merry gang of interventionists at Trudeau for PM headquarters to devise one.
His latest election promise is a tax credit for teachers worth up to $150 a year. The problem with this credit is that teachers are net tax recipients. They can't really be said to pay taxes; this is an accounting fiction. In reality the 'taxes' they pay are simply a reduction in their salary. So a reduction in this reduction is in reality a raise. But teachers are already paid far too much (if you're using Chrome and can't read this link open it in incognito mode). Even before counting their extremely generous benefits elementary and secondary school teachers make around $70 an hour. And what do we get for these high salaries? Not very much. Terrible teachers are protected vigorously by their union and bureaucracy and waste in public schools is endemic. The principled libertarian solution is both simple and powerful; smash the public school monopoly and the teachers union. Shut down public education, auction off the schools, use the revenue obtained in this manner to pass broad tax reform and let the free market handle education. Then a school which coddled bad teachers would find itself losing out to those which didn't. Wasteful bureaucracy would also be weeded out because schools which found ways to eliminate waste and bureaucracy would be able to charge lower prices to consumers beating out their less efficient competitors. And parents who decided to home school would no longer have to subsidize the now non existent pubic school system with their taxes; an important development considering the supremacy of one on one education.
His latest election promise is a tax credit for teachers worth up to $150 a year. The problem with this credit is that teachers are net tax recipients. They can't really be said to pay taxes; this is an accounting fiction. In reality the 'taxes' they pay are simply a reduction in their salary. So a reduction in this reduction is in reality a raise. But teachers are already paid far too much (if you're using Chrome and can't read this link open it in incognito mode). Even before counting their extremely generous benefits elementary and secondary school teachers make around $70 an hour. And what do we get for these high salaries? Not very much. Terrible teachers are protected vigorously by their union and bureaucracy and waste in public schools is endemic. The principled libertarian solution is both simple and powerful; smash the public school monopoly and the teachers union. Shut down public education, auction off the schools, use the revenue obtained in this manner to pass broad tax reform and let the free market handle education. Then a school which coddled bad teachers would find itself losing out to those which didn't. Wasteful bureaucracy would also be weeded out because schools which found ways to eliminate waste and bureaucracy would be able to charge lower prices to consumers beating out their less efficient competitors. And parents who decided to home school would no longer have to subsidize the now non existent pubic school system with their taxes; an important development considering the supremacy of one on one education.
Tuesday, August 25, 2015
[x] socialized medicine
A staple of the political discourse in Canada is the constant affirmation of both the quality of our health care system and the importance of preserving it's single payer nature. The allegedly pro free market conservatives have nearly doubled spending on health care, education and social services in just under a decade and federal health care spending in particular has increased a a rate of 6% per year. Patrick Brown, leader of the Conservative Party of Ontario, has attacked Liberal health care "cuts" and representatives from both the Liberal and New Democratic Parties federally and provincially bray constantly about the necessity of spending more money on health care. Among Canadian politicians there is a virtual unanimity of opinion in favour of socialized medicine. The public is equally enamoured with free health care and expresses their support overwhelming in opinion polls on the subject.
How does the system work? Individuals who need medical attention go to a doctors office or hospital and the government is billed for the cost of these visits in accordance with an annual price structure determined by the Ministry of Health. Some physicians are salaried employees of hospitals.
Private health insurance is illegal in Alberta, B.C., Manitoba, Ontario and PEI but was recently legalized in Quebec through a recent court decision. Price controls in Manitoba, Nova Scotia and Ontario are in place forbidding private sector physicians from charging more than the OHIP (Ontario Health Insurance Plan) price schedule. Since health insurance is a vital to handling the expense of catastrophic care and a freely fluctuating price system is critical for the health of any market these regulations have served to cripple any affordable private alternative to the public system, which was kind of the point.
Economically the Canadian public system is one of 'market socialism'. The theory of market socialism developed as a response to Mises' problem of economic calculation which argues that rational allocation of scarce resources in capital goods industries is impossible without a price structure derived from legitimate market activities. Why socialists want to play market when you could just have a market is still something of a mystery.
The libertarian alternative would be simply to have a market in health care, likely taking the form of direct payment for routine visits and insurance for catastrophic care. Eliminating compulsory licensure and legalizing health insurance would also be important. The advantage to an actual health care market would be an end to health care rationing and the long waiting lists which plague our system and a substantial reduction in bureaucracy. Competition between firms would help keep prices under control and reduce waste while freely floating prices would help direct scarce resources towards their most efficacious ends. Insurance can also help individuals identify risk, as lifestyle choices such as smoking or obesity lead to higher premiums, and provide a financial incentive to make healthier decisions. End users being charged for doctors visits would also help eliminate patients making a frivolous use of a doctors time and the elimination of compulsory licensure would make it much easier for foreign trained doctors or other non certified individuals (such as a nurse who has been practicing for 20 years) to provide medical care.
Advocates of the current single payer system argue that a market in health care will make things more expensive because of the dread profit motive, that everyone deserves access to care or that everyone deserves equal access to care, that private insurance companies have higher overheads than government insurance and that some people won't be able to afford health insurance. But the argument against the profit motive is not unique to the health care industry and taken to it's logical conclusion it advocates for complete communism, which historically has not worked out that well, and it's difficult to imagine the private sector ever having as much waste and bureaucracy as a government program. As for those who cannot afford to pay a doctor or purchase health insurance, presumably they will still be treated at hospitals in the event of an emergency and charitable free clinics can be established for more routine care.
Eliminating the state monopoly on health insurance and developing a free market in medical care is absolutely critical to the well being of our nation.
How does the system work? Individuals who need medical attention go to a doctors office or hospital and the government is billed for the cost of these visits in accordance with an annual price structure determined by the Ministry of Health. Some physicians are salaried employees of hospitals.
Private health insurance is illegal in Alberta, B.C., Manitoba, Ontario and PEI but was recently legalized in Quebec through a recent court decision. Price controls in Manitoba, Nova Scotia and Ontario are in place forbidding private sector physicians from charging more than the OHIP (Ontario Health Insurance Plan) price schedule. Since health insurance is a vital to handling the expense of catastrophic care and a freely fluctuating price system is critical for the health of any market these regulations have served to cripple any affordable private alternative to the public system, which was kind of the point.
Economically the Canadian public system is one of 'market socialism'. The theory of market socialism developed as a response to Mises' problem of economic calculation which argues that rational allocation of scarce resources in capital goods industries is impossible without a price structure derived from legitimate market activities. Why socialists want to play market when you could just have a market is still something of a mystery.
The libertarian alternative would be simply to have a market in health care, likely taking the form of direct payment for routine visits and insurance for catastrophic care. Eliminating compulsory licensure and legalizing health insurance would also be important. The advantage to an actual health care market would be an end to health care rationing and the long waiting lists which plague our system and a substantial reduction in bureaucracy. Competition between firms would help keep prices under control and reduce waste while freely floating prices would help direct scarce resources towards their most efficacious ends. Insurance can also help individuals identify risk, as lifestyle choices such as smoking or obesity lead to higher premiums, and provide a financial incentive to make healthier decisions. End users being charged for doctors visits would also help eliminate patients making a frivolous use of a doctors time and the elimination of compulsory licensure would make it much easier for foreign trained doctors or other non certified individuals (such as a nurse who has been practicing for 20 years) to provide medical care.
Advocates of the current single payer system argue that a market in health care will make things more expensive because of the dread profit motive, that everyone deserves access to care or that everyone deserves equal access to care, that private insurance companies have higher overheads than government insurance and that some people won't be able to afford health insurance. But the argument against the profit motive is not unique to the health care industry and taken to it's logical conclusion it advocates for complete communism, which historically has not worked out that well, and it's difficult to imagine the private sector ever having as much waste and bureaucracy as a government program. As for those who cannot afford to pay a doctor or purchase health insurance, presumably they will still be treated at hospitals in the event of an emergency and charitable free clinics can be established for more routine care.
Eliminating the state monopoly on health insurance and developing a free market in medical care is absolutely critical to the well being of our nation.
Sunday, August 23, 2015
The righteous struggle for $15 daycare
The black family, which had survived centuries of slavery and discrimination, began rapidly disintegrating in the liberal welfare state that subsidized unwed pregnancy and changed welfare from an emergency rescue to a way of life.
At every step of the way the struggle for so called progressive achievements has been described by it's proponents as a battle between wretched reactionaries and enlightened angels. This is not simply a question of varying policy proposals or differing means for obtaining a particular end but a struggle of good vs evil. Objections to the ever expanding arsenal of etatist programs are seldom rebutted in a serious manner but simply swept aside, unworthy of serious consideration. Advanced instead are what Sowell calls 'argument without arguments'; repetition becomes reality.
The latest in progressive policy is the right to $15 a day childcare, a la Quebec, advocated by NDP leader and potential Prime Minister Tom Mulcair. Never mind the fact that our economy is already struggling under the weight of heavy taxes and an oppressive regulatory regime or the trillions of dollars of debt which have been accrued in the name of the long suffering taxpayer. For progressives, any excuse to expand the size and scope of the state will suffice.
One key feature of the social democratic viewpoint is moral relativism. All cultures, attitudes and philosophies are equal. They claim there are no absolute truths just varying interpretations of a subjective reality. But this whole point of view is mistaken. Different lifestyles have different results. Some cultures are barbaric; certain lifestyles should be condemned. And if the truth gets in the way of egalitarianism? Then so much for the truth. There are reasons why cultural traditions survive through the ages; even if need for these institutions is not articulated or even understood. These things work. Marriage works. Traditional lifestyles work. They generate better results, in terms of health or socio-economic success, when contrasted with deviant decisions.
The family unit is the foundation on which society is built. The child's relationship with their parents shapes their worldview and foreshadows future interactions with others. But the welfare state has been an unrepentant attack on the traditional family structure. The economic havoc wrought by confiscatory tax rates, profligate government spending and constant inflation have made the one income family mostly the dream of a bygone era. The essential role of the parent of intellectual and moral instructor has been increasingly replaced by the compulsory public school system and television sets. And by subsidizing daycare one more tenuous link to the traditional family structure and the traditional parent-child relationship will be cut.
By contrast, the Conservative income splitting proposal would at least make it somewhat easier for single income families to exist and help alleviate, to some small degree, the tax burden of a few people. But to progressives, who view all of our income as fundamentally belonging to the state, such an idea was a non starter. C'est la vie.
Thomas Sowell
At every step of the way the struggle for so called progressive achievements has been described by it's proponents as a battle between wretched reactionaries and enlightened angels. This is not simply a question of varying policy proposals or differing means for obtaining a particular end but a struggle of good vs evil. Objections to the ever expanding arsenal of etatist programs are seldom rebutted in a serious manner but simply swept aside, unworthy of serious consideration. Advanced instead are what Sowell calls 'argument without arguments'; repetition becomes reality.
The latest in progressive policy is the right to $15 a day childcare, a la Quebec, advocated by NDP leader and potential Prime Minister Tom Mulcair. Never mind the fact that our economy is already struggling under the weight of heavy taxes and an oppressive regulatory regime or the trillions of dollars of debt which have been accrued in the name of the long suffering taxpayer. For progressives, any excuse to expand the size and scope of the state will suffice.
One key feature of the social democratic viewpoint is moral relativism. All cultures, attitudes and philosophies are equal. They claim there are no absolute truths just varying interpretations of a subjective reality. But this whole point of view is mistaken. Different lifestyles have different results. Some cultures are barbaric; certain lifestyles should be condemned. And if the truth gets in the way of egalitarianism? Then so much for the truth. There are reasons why cultural traditions survive through the ages; even if need for these institutions is not articulated or even understood. These things work. Marriage works. Traditional lifestyles work. They generate better results, in terms of health or socio-economic success, when contrasted with deviant decisions.
The family unit is the foundation on which society is built. The child's relationship with their parents shapes their worldview and foreshadows future interactions with others. But the welfare state has been an unrepentant attack on the traditional family structure. The economic havoc wrought by confiscatory tax rates, profligate government spending and constant inflation have made the one income family mostly the dream of a bygone era. The essential role of the parent of intellectual and moral instructor has been increasingly replaced by the compulsory public school system and television sets. And by subsidizing daycare one more tenuous link to the traditional family structure and the traditional parent-child relationship will be cut.
By contrast, the Conservative income splitting proposal would at least make it somewhat easier for single income families to exist and help alleviate, to some small degree, the tax burden of a few people. But to progressives, who view all of our income as fundamentally belonging to the state, such an idea was a non starter. C'est la vie.
Saturday, August 22, 2015
a tale of two candidates
The meteoric rise of Donald Trump is par for the course as far as GOP nominations for presidential candidates are concerned. While there is much to condemn in his platform (a mix of nativism, dirigism, and a celebration of all things Trump) and his evident plan to elevate the imperial presidency to new heights, it has been quite some time since the GOP stage was ever a forum for intelligent debate. Ron Paul in 2008 and 2012 was simply the exception which proved the rule.
Rand Paul, by contrast, is quiet and self effacing; policy oriented and obviously the product of eclectic intellectual influences. In his speeches and events Paul is a relentless critic of profligate government spending, the regulatory state and bellicose foreign policy. His is a campaign of ideas, unlike Trump's cult of personality, and harkens back to the grand tradition of the Old Right as exemplified by Howard Buffet or Robert Taft. Paul has also been a vocal advocate of civil liberties and of the right to privacy in this age of the blossoming surveillance state.
The Paul campaign is a reminder that in the long run ideas and ideology can trump narrow economic interests and that politics can be elevated to something more than base rent seeking. Whether or not Paul succeeds in capturing the GOP nomination or the presidency his unabashed advocacy of limited government will no doubt inspire a new generation of activists to reject the status quo of an ever expanding role of the federal government. Unlike conservatives, who are obsessed with the short run and forever fretting over the latest election, libertarians should recognize that the success or failure of our movement depends entirely on our ability to enunciate the importance of freedom and to recruit others to the cause. We can, nay we must succeed and likely we will but victory will be achieved through broad educational efforts both inside and outside of the political process.
Rand Paul, by contrast, is quiet and self effacing; policy oriented and obviously the product of eclectic intellectual influences. In his speeches and events Paul is a relentless critic of profligate government spending, the regulatory state and bellicose foreign policy. His is a campaign of ideas, unlike Trump's cult of personality, and harkens back to the grand tradition of the Old Right as exemplified by Howard Buffet or Robert Taft. Paul has also been a vocal advocate of civil liberties and of the right to privacy in this age of the blossoming surveillance state.
The Paul campaign is a reminder that in the long run ideas and ideology can trump narrow economic interests and that politics can be elevated to something more than base rent seeking. Whether or not Paul succeeds in capturing the GOP nomination or the presidency his unabashed advocacy of limited government will no doubt inspire a new generation of activists to reject the status quo of an ever expanding role of the federal government. Unlike conservatives, who are obsessed with the short run and forever fretting over the latest election, libertarians should recognize that the success or failure of our movement depends entirely on our ability to enunciate the importance of freedom and to recruit others to the cause. We can, nay we must succeed and likely we will but victory will be achieved through broad educational efforts both inside and outside of the political process.
Friday, August 21, 2015
What liberty could realize
A key feature of a recession is a lack of growth across the economy as a whole, or more specifically focused in capital good industries, as malinvestments born of artificially low interest rates are liquidated. A struggling sector, poisoned by the one two punch of falling prices and higher taxes, does not a general economic downturn make. Moreover the question of whether or not we are in a recession is an academic one, since the prescription for either boom or bust is to cut taxes and spending. But in a broader sense we have become accustomed to permanent recessions, to growth that is anemic even at the best of times. To understand why we must examine the role of the state in the economy.
The state functions as a parasite. Resources are siphoned from the productive private sector, where they are engaged in the positive creation of wealth and the satisfaction of consumer demand to the public sector, where they are consumed by net tax recipients and spent on the various activities of government. Some of these activities, such as policing or the provision of health care are productive. Others, such as the nefarious regulatory state or the bombing of Iraq and Syria are counter productive to the creation of wealth or actively engaged in spreading destruction and death, respectively. But even where money is spent on health care or education, perhaps the most benign examples of state activities, this money is wasted in large part on bureaucracy and other inefficiencies that attend state monopoly. It is axiomatic that a government monopoly will not perform as effectively as market competition can. Nor is there any basis for rational allocation of scarce resources without a price system derived from the activities of interested entrepreneurs and consumers. There is no way to accurately ape market processes.
Monetary policy, ostensibly the work of benevolent overlords to save our economy from ruin actively creates the boom-bust business cycle and the permanent dislocations it entails. The lifestyles of bureaucrats, politicians and interest groups are financed directly from the wealth extorted from those engaged in it's creation. The total effect of this system when viewed from the bird's eye is a permanent economic malaise. Were the host (society) cure of it's parasite (the state), were the entire apparatus of taxation, regulation, and inflation miraculously and gloriously smashed then we would see a radically different economic ecosystem. Double digit growth rates and steady prosperity would be the norm. What could be accomplished within this new (and old) paradigm is truly incredible to consider.
And imagine for a moment, in a Canada without the state and it's economic bungling, what could happen were the flood gates of immigration to be lifted and the curse of conservation to be lifted. If the prosperity from laissez-faire were directed towards taming our wilds and developing the mass of what is presently crown land into factories and cities and industrial projects. If hundreds of millions of immigrants and refugees were allowed to flea the oppressive dictators, brutal conflicts and grinding poverty of their homelands and make a new life settling here, helping us conquer the untamed wilds that occupy so much of our country. If we could save the world, one immigrant or refugee at a time.
Monday, August 17, 2015
But who will deliver the mail?
Above, Mayor of Montreal Denis Coderre seen jackhammering the foundation for a community mailbox in protest of Canada Post's recent decision to stop delivering the mail.
The decision to switch from door delivery to community mail boxes has provoked much outrage and fist shaking from members of the public and politicians. NDP Leader and Prime Minister-in-Waiting, Tom Mulcair has made the restoration of door-to-door service a campaign pledge while Trudeau has dutifully pledged to study the issue. But while the debate rages between members of the opinion molding class on what level of mail service the state should offer, perhaps there is another option? Why not consider privatization?
There are presently 6,500 post offices across the country but electronic communications and parcel delivery companies have all but eliminated the need for mail at all. Were Canada Post to cease operations these buildings could be re-purposed to serve the more urgent needs of consumers and the sale of these assets could fetch a tidy sum to be directed towards tax relief. The 6.5 billion pension shortfall would have to be dealt with; perhaps we could mail out a few 'sorry about your luck' cards before shutting it down. Not only would the land and vehicles be put to more productive use but so would the bureaucrats forced to find more productive employment.
Most likely, with fewer resources directed towards postal delivery, the price for flyers and other forms of direct commercial advertising (junk mail) would increase and we would be subjected to less of it or it would become targeted more accurately towards those who wish to receive it. And of course the subsidy for MP mailings would have to go. Even if prices went up on account of privatization (and they could very well) it would mean that the price of other stuff went down as resources were directed towards more urgent areas of consumer demand. Further, competition between firms would work to eliminate inefficiency and waste and keep prices down so even if prices for mail went up as resources were shifted out of that sector they would also be forced down on account of greater efficiency.
Instead of quibbling over exactly how much mail should be delivered and when, let's just privatize Canada Post and be done with it.
There are presently 6,500 post offices across the country but electronic communications and parcel delivery companies have all but eliminated the need for mail at all. Were Canada Post to cease operations these buildings could be re-purposed to serve the more urgent needs of consumers and the sale of these assets could fetch a tidy sum to be directed towards tax relief. The 6.5 billion pension shortfall would have to be dealt with; perhaps we could mail out a few 'sorry about your luck' cards before shutting it down. Not only would the land and vehicles be put to more productive use but so would the bureaucrats forced to find more productive employment.
Most likely, with fewer resources directed towards postal delivery, the price for flyers and other forms of direct commercial advertising (junk mail) would increase and we would be subjected to less of it or it would become targeted more accurately towards those who wish to receive it. And of course the subsidy for MP mailings would have to go. Even if prices went up on account of privatization (and they could very well) it would mean that the price of other stuff went down as resources were directed towards more urgent areas of consumer demand. Further, competition between firms would work to eliminate inefficiency and waste and keep prices down so even if prices for mail went up as resources were shifted out of that sector they would also be forced down on account of greater efficiency.
Instead of quibbling over exactly how much mail should be delivered and when, let's just privatize Canada Post and be done with it.
Saturday, August 8, 2015
The New Colossus
Not like the brazen giant of Greek fame,
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
"Keep, ancient lands, your storied pomp!" cries she
With silent lips. "Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!"
The New Colossus by Emma Lazarus
Immigration and immigrants are popular whipping boys for demagogues on both the left and the right. Presidential candidate Bernie Sanders dismissed the notion of open borders as Koch brother plot which would impoverish the American people while Donald Trump took a page from Ann Coulter's book and labelled Mexican immigrants broadly as rapists. Here in Canada the ostensibly pro free market think tank The Fraser Institute published a study in 2013 which argued that foreigners cost native born Canadians some twenty billion dollars a year because of disparities between the taxes they pay and the services they consume. 2014 saw hysteria concerning the Temporary Foreign Worker Program (TFWP) reach record levels as the CBC's yellow journalism incited a xenophobic backlash against foreign worker. The Harper government reacted by sharply curtailing the program.
While newcomers may make an attractive scapegoat for economic ills, real and imagined, immigration is a tremendous boon for both the newcomers and those of us who are already here. The people who leave get the opportunity to find higher paying work, often several times more than what they would get paid at home (the typical salary in Canada is 4x more than what people make in the Phillipine and 130x more than what people are paid in Sierra Leone) and in the case of refugees they escape war, famine or poverty. Almost always the governments they leave behind are even more despotic and kleptocratic than the one we suffer under. In Canada they get an opportunity to experience peace and prosperity. In return, Canadians benefit from a broadened division of labour society and additional opportunities for trade. Unskilled immigrants, especially those suffering from a language barrier, may have an appetite for demanding work with relatively little pay which most Canadians spurn and the income earned by newcomers in turn becomes demand for additional goods and services, creating more jobs. Even unskilled immigrants may be able to provide a new service, such as language tutoring in an obscure language.
The issue of net tax consumption is an important one but the real tax consumers are not immigrants employed in the private sector but politicians and their cronies who have been living high on the hog for quite some time. It is very typical of the establishment to practice a divide and conquer strategy of finding someone to blame so no one looks too closely at the man behind the curtain. The power elite want us to hate and mistrust each other so that while we are fighting they can continue to loot the wealth of the productive economic class and use the machinery of the state to fight pointless wars in the middle east or wreck our economy with high taxes, unnecessary regulation and constant inflation. It is thus vital for them that permanent and visible underclass exists, both so that this class can grow dependent upon the welfare state for survival (and in return off political support at the ballot box for social democratic politicians) and so that class war rhetoric can obfuscate the symbiotic role of rich and poor as well as the parasitic role of the political class upon the whole of society.
Instead of closing off our borders and huddling in fear of immigrants taking our jobs or terrorists blowing us up, we should welcome anyone who wishes to come here and experience freedom and prosperity.
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
"Keep, ancient lands, your storied pomp!" cries she
With silent lips. "Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!"
The New Colossus by Emma Lazarus
Immigration and immigrants are popular whipping boys for demagogues on both the left and the right. Presidential candidate Bernie Sanders dismissed the notion of open borders as Koch brother plot which would impoverish the American people while Donald Trump took a page from Ann Coulter's book and labelled Mexican immigrants broadly as rapists. Here in Canada the ostensibly pro free market think tank The Fraser Institute published a study in 2013 which argued that foreigners cost native born Canadians some twenty billion dollars a year because of disparities between the taxes they pay and the services they consume. 2014 saw hysteria concerning the Temporary Foreign Worker Program (TFWP) reach record levels as the CBC's yellow journalism incited a xenophobic backlash against foreign worker. The Harper government reacted by sharply curtailing the program.
While newcomers may make an attractive scapegoat for economic ills, real and imagined, immigration is a tremendous boon for both the newcomers and those of us who are already here. The people who leave get the opportunity to find higher paying work, often several times more than what they would get paid at home (the typical salary in Canada is 4x more than what people make in the Phillipine and 130x more than what people are paid in Sierra Leone) and in the case of refugees they escape war, famine or poverty. Almost always the governments they leave behind are even more despotic and kleptocratic than the one we suffer under. In Canada they get an opportunity to experience peace and prosperity. In return, Canadians benefit from a broadened division of labour society and additional opportunities for trade. Unskilled immigrants, especially those suffering from a language barrier, may have an appetite for demanding work with relatively little pay which most Canadians spurn and the income earned by newcomers in turn becomes demand for additional goods and services, creating more jobs. Even unskilled immigrants may be able to provide a new service, such as language tutoring in an obscure language.
The issue of net tax consumption is an important one but the real tax consumers are not immigrants employed in the private sector but politicians and their cronies who have been living high on the hog for quite some time. It is very typical of the establishment to practice a divide and conquer strategy of finding someone to blame so no one looks too closely at the man behind the curtain. The power elite want us to hate and mistrust each other so that while we are fighting they can continue to loot the wealth of the productive economic class and use the machinery of the state to fight pointless wars in the middle east or wreck our economy with high taxes, unnecessary regulation and constant inflation. It is thus vital for them that permanent and visible underclass exists, both so that this class can grow dependent upon the welfare state for survival (and in return off political support at the ballot box for social democratic politicians) and so that class war rhetoric can obfuscate the symbiotic role of rich and poor as well as the parasitic role of the political class upon the whole of society.
Instead of closing off our borders and huddling in fear of immigrants taking our jobs or terrorists blowing us up, we should welcome anyone who wishes to come here and experience freedom and prosperity.
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