Monthly Archives: August 2012

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Republican National Travesty – and What to Do Next – Video by G. Stolyarov II

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The Republican National Convention was a farce, in spite of courageous actions by Ron Paul’s supporters, including the Nevada delegation which Mr. Stolyarov helped elect as a State Delegate.

The change of rules by the Republican National Committee turns the Republican Party into a rigid oligarchy, with no chance for grassroots activists and ideas rising to prominence.

Mr. Stolyarov expresses his thoughts about where friends of liberty should focus next. Breaking the two-party system and supporting Gary Johnson for President, while also working outside the political system to improve individual freedom through technology.

References

Gary Johnson 2012
– “RINOs Boehner & Sununu Booed As They Change The Rules In A Major Power Grab” – Video – August 28, 2012
– “Evidence Shows RNC Rigged Vote on Rule Change at Republican Convention 2012?” – Texas GOP Vote
– “Call Off the Global Drug War” – Jimmy Carter – June 16, 2012
– “A Cruel and Unusual Record” – Jimmy Carter – June 24, 2012

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Factors for (141^141 + 142^142) and (148^148 + 149^149) Discovered by Mr. Stolyarov and ECM Distributed Computing Project

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The New Renaissance Hat
G. Stolyarov II
August 28, 2012
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Since the discovery in April 2012 of a factor for (118^67 + 67^118), I have continued to donate extensive computing resources to the ECM distributed computing project (organized via Yoyo@home). Today I am pleased to announce that two more large factors of even larger numbers have been discovered as a result of this endeavor. I am credited with the discoveries here. The following is now known:

● The number (141^141 + 142^142) (see long form here) has a 33-digit factor: 168,853,190,844,095,597,109,245,277,698,729.

● The number (148^148 + 149^149) (see long form here) has a 28-digit factor: 9,055,497,748,306,357,299,810,062,467.

To date, my computer has examined 2729 project workunits (each involving an attempt to factor a large number). I have thus far accumulated 528,533.42 BOINC credits for the ECM project.

The magnitudes involved are astounding, considering that the factors discovered are several hundred orders of magnitude less than the original numbers. As an example, (148^148 + 149^149) is equal to approximately 6.39 * 10^323. And yet our advancing technology is enabling us already to explore these immense quantities and derive meaningful conclusions regarding them.

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Droughts, Famines, and Markets – Article by Steven Horwitz

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The New Renaissance Hat
Steven Horwitz
August 28, 2012
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As I write, many high school students all over the United States, my daughter included, are reading John Steinbeck’s The Grapes of Wrath, with its portrayal of the 1930s Dust Bowl, in preparation for literature courses in the fall.  Steinbeck’s fictional account vividly captures the suffering endured by many Americans due to the severe drought, poor farming techniques, and ensuing dust storms in Texas, Oklahoma, and other states.

With the U.S. Midwest stricken by drought this summer, it’s worth considering why the crop failures there have not led to food shortages and other serious problems.

It’s also worth considering why famines, which occurred with regularity for most of human history, have all but disappeared in the last 100 years or so.

The answer is: the market and globalization.  This combination, for reasons I explore below, enables humanity to be far less at the mercy of the weather and provides us with ways to ensure that food gets to where it needs to go.

Markets help us avoid famines in two ways.  First, the innovation made possible by the search for profit and the relative freedom of markets in the western world have increased agricultural productivity by an order of magnitude.  We feed a planet of almost 7 billion reasonably well–although not as well as we might like–and we do it with a decreasing number of people and acres of land.  The United States can feed its own population and still export grain to the rest of the world–even as farmers are forced to divert corn to boondoggles like ethanol.  We are at less risk for famines simply because we can produce more food with fewer resources, and even if one large crop fails, we have more large crops elsewhere to make up the loss.

Signals

The second way markets help is that price and profit signals inform producers where foodstuffs are in short supply and simultaneously provide incentives to get the food there.  Prices are an incentive wrapped in knowledge, enabling them to serve as traffic signals to ensure that no one goes without. True, food may be more expensive during a drought, but that is far better than no food at all, as was often the case in human history.

We see these processes at work right now.  The drought in the middle of America destroyed a good deal of the corn crop in Indiana and Iowa.  Meanwhile, farmers in places like Washington state and Virginia have largely escaped unscathed.  The short supply in the Midwest drives up prices and signals to producers elsewhere that profit opportunities exist in those places; the incentive associated with that signal leads farmers to get their crops to where the demand is.  Yes, the higher prices mean that folks will be a little worse off, but corn is in fact more scarce, so those higher prices are not the result of farmers exploiting the drought, but rather a reflection of genuinely shorter supply.

The price signals might also cause corn producers to divert some corn from other uses to food for humans. Such substitution is only possible because market prices provide the needed knowledge and incentives. In a world without markets, producers could not get information so easily and effectively; nor would they have the incentive to respond appropriately. More famines would result.

Globalization

Finally, globalization has nearly eradicated famines.  All the market processes I have identified are even more effective when the area of trade expands.  When commodity markets are global, countries facing droughts and bad harvests have a whole world from which they can attract new supplies.  The United States is not limited to tapping farmers in Washington and Virginia. It can attract corn from around the world.  In fact, Canadian farmers have had a much better year and are already seeing higher prices for their exports to the United States.  Canadians will pay a bit more for their grains as a result, but prices in the United States will be significantly lower than they would be without the Canadian imports.

As Pierre Desrochers and Hiroko Shimizu point out in their wonderful new book, The Locavore’s Dilemma, the belief that making food production and distribution more local and less global will increase “food security” has it exactly backward.  The most important thing we can do to ensure a secure food supply in the face of droughts and other threats to the harvest is to allow markets to work freely and extend that freedom globally.

We cannot control the weather, so the threat of drought is always present. But we can unleash the market and further globalize food production to avoid the human disaster of famines when harvests go bad.  The conquering of famine is one of the great human accomplishments of the last century.  That no one is starving because of the drought this summer is evidence of that victory.  Let’s not let the forces of locavorism reverse those gains.

Steven Horwitz is the Charles A. Dana Professor of Economics at St. Lawrence University and the author of Microfoundations and Macroeconomics: An Austrian Perspective, now in paperback.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.

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Military “Cuts”: Don’t Believe the Hype – Article by Ron Paul

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The New Renaissance Hat
Ron Paul
August 23, 2012
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Grover Norquist, the influential conservative activist, recently made some very frank and sobering remarks about the U.S. military budget.  Unlike many conservatives, Mr. Norquist understands that American national security interests are not served by the interventionist foreign policy mindset that has dominated both political parties in recent decades.  He also understands that there is nothing “conservative” about incurring trillions of dollars in debt to engage in hopeless nation building exercises overseas.

Speaking at the Center for the National interest last week, Norquist stated that “We can afford to have an adequate national defense which keeps us free and safe and keeps everybody afraid to throw a punch at us, as long as we don’t make some of the decisions that previous administrations have, which is to over extend ourselves overseas and think we can run foreign governments.”

He continued: “Bush decided to be the mayor of Baghdad rather than the president of the United States. He decided to occupy Iraq and Afghanistan rather than reform Fannie Mae and Freddie Mac. That had tremendous consequences… Richard Nixon said that America’s national defense needs are set in Moscow, meaning that we wouldn’t have to spend so much if they weren’t shooting at us.  The guys who followed didn’t notice that the Soviet Union disappeared.”

When a prominent DC conservative like Grover Norquist makes such bold statements, it shows that public support for a truly conservative foreign policy is growing.  The American people simply cannot stomach more wars and more debt, especially with our domestic economy in tatters.

The American people should reject the hype about so called defense “cuts” from both side of the political spectrum.  When the Obama administration calls for an 18% increase in 2013 military spending, those who propose a 20% increase portray this as a reduction!

Even the supposedly draconian cuts called for in the “sequestration” budget bill would keep military spending at 2006 levels when adjusted for inflation, which is about as high in terms of GDP as during World War II.  It’s also more than the top 13 foreign countries spend on defense combined.  Furthermore, sequestration only cuts military spending for one year after taking effect.  In future years Congress is free to reinstate higher military spending levels– so under sequestration the most drastic case would mean spending $5.2 trillion instead of $5.7 trillion over the next decade.

Is there any amount of money that would satisfy the Pentagon hawks? Even if we were to slash our military budget in half, America easily would remain the world’s dominant military power.  Our problems don’t result from a lack of spending. They result from a lack of vision and a profound misunderstanding of the single biggest threat to every American man, woman, and child: the federal debt.

Representative Ron Paul (R – TX), MD, is a Republican candidate for U. S. President. See his Congressional webpage and his official campaign website

This article has been released by Dr. Paul into the public domain and may be republished by anyone in any manner.

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Why the Deflationists Are Wrong – Article by Gary North

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The New Renaissance Hat
Gary North
August 23, 2012
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An inflationist is someone who believes that price inflation is the result of two things: (1) monetary inflation and (2) central-bank policy.

A deflationist is someone who believes that deflation is inevitable, despite (1) monetary inflation and (2) central -bank policy.

No inflationist says that price inflation is inevitable. Every deflationist says that price deflation is inevitable.

Deflationists have been wrong ever since 1933.

Milton Friedman is most famous for his book A Monetary History of the United States (1963), which relies on facts collected by Anna Schwartz, who died recently.

It is for one argument: the Federal Reserve caused the Great Depression because it refused to inflate.

This argument, as quoted by mainstream economists, is factually wrong.

I often cite a study, where you can see that the monetary base grew under the Federal Reserve, 1931 to 1932. This graph is from a speech given by the vice president of the Federal Reserve Bank of St. Louis. You can access it here.

Figure 1
I posted this first in early 2010.

We can see that there was monetary deflation of the money supply, beginning in 1930. This continued in 1931 and 1932, despite a deliberate policy of inflation by the Fed, beginning in the second half of 1931 and continuing through 1932.

Depositors kept pulling currency out of banks and hoarding it. They did not redeposit it in other banks. This imploded the fractional-reserve-banking process for the banking system as a whole. M1 declined: monetary deflation.

The Fed could not control M1. It could only control the monetary base.

The argument of Friedman and Schwartz was picked up by mainstream economists. It is his most famous and widely accepted position. Bernanke praised him for it on Friedman’s 90th birthday in 2002.

Why was the argument wrong, as applied to 1931–33? I must tell the story one more time. Four letters tell it: FDIC. Well, nine: FDIC + FSLIC. They did not exist.

Franklin Roosevelt froze all bank deposits in early March 1933, immediately after his inauguration. This calmed the public when the banks reopened a few days later. He verbally promised people that the banks were now safe.

The US government created federal bank-depositor insurance in 1933. The Wikipedia article describes the Banking Act of 1933, which was signed into law in June:

  • Established the FDIC as a temporary government corporation
  • Gave the FDIC authority to provide deposit insurance to banks
  • Gave the FDIC the authority to regulate and supervise state non-member banks
  • Funded the FDIC with initial loans of $289 million through the U.S. Treasury

That stopped the bank runs. The money supply reversed. It went ballistic. So did the monetary base.

The key event was therefore the Banking Act of 1933. After that, the money supply never fell again. After that, prices never fell again by more than 1 percent. That was in 1955.

All it took for prices to reverse and rise was this: an expansion of the monetary base coupled with bank lending.

Yet deflationists ever since 1933 have predicted falling prices. They die predicting this. Then their successors die predicting this.

They never learn.

They do not understand monetary theory. They do not understand monetary history. They therefore do not learn. They do not correct their bad predictions, year after year, decade after decade, generation after generation.

They still find people who believe them, people who also do not understand monetary theory or monetary history.

I have personally been arguing against them for four decades.

Price deflation has nothing to do with the fall in the price of stocks.

There can be monetary deflation as a result of excess reserves held at the Fed by commercial banks. But this is Fed policy. The Fed pays banks interest on the deposits. Even if it didn’t, there would still be excess reserves. But by imposing a fee on excess reserves, the Fed could eliminate excess reserves overnight. Then the money multiplier would go positive, price inflation would reappear, and the Fed would get blamed. So, it maintains a policy of restricting the M1 multiplier.

Every inflationist says that monetary inflation will produce hyperinflation unless reversed by the central bank. There will be a return to low prices after what Ludwig von Mises called the crack-up boom. The classic example is Germany in 1934. That was a matter of policy. The central bank substituted a new currency and stopped inflating.

John Exter — an old friend of mine — argued in the 1970s and 1980s that monetary deflation has to come, despite Fed policy. There will be a collapse of prices through deleveraging.

He was wrong. Why? Because it is not possible for depositors to take sufficient money in paper-currency notes out of banks and keep these notes out, thereby reversing the fractional-reserve process, thereby deflating the money supply. That was what happened in the United States from 1930 to 1933. If hoarders spend the notes, businesses will redeposit them in their banks. Only if they deal exclusively with other hoarders can they keep money out of banks. But the vast majority of all money transactions are based on digital money, not paper currency.

Today, large depositors can pull digital money out of bank A, but only by transferring it to bank B. Digits must be in a bank account at all times. There can be no decrease in the money supply for as long as money is digital. Hence, there can be no decrease in prices unless it is Fed policy to decrease prices. This was not true, 1930 to 1933.

Deflationists never respond to this argument by invoking either monetary theory or monetary history. You can and should ignore them until one of them does answer this, and all the others publicly say, “Yes. That’s it! We have waited since 1933 for this argument! I was blind, but now I see! I’m on board! I will sink or swim with this.”

Let me know when this happens. Until then, ignore the deflationists. All of them. (There are not many still standing.)

The fact that a new deflationist shows up is irrelevant. Anyone can predict inevitable price deflation. They keep doing this. Look for the refutation of the inflationists’ position. Look for a theory.

If you do not understand the case I have just made, you will not understand any refutation. In this case, just pay no attention to either side. If you cannot follow economic theory, the debate will confuse you. It’s not worth your time.

For background, see my book Mises on Money.

See also Murray Rothbard’s book What Has Government done to Our Money?

Gary North is the author of Mises on Money and Honest Money: The Biblical Blueprint for Money and Banking. He is also the author of a free 20-volume series, An Economic Commentary on the Bible. Visit his website: GaryNorth.com. Send him mail. See Gary North’s article archives.

This article originally appeared on GaryNorth.com.

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Copyright © 2012 by the Ludwig von Mises Institute. Permission to reprint in whole or in part is hereby granted, provided full credit is given.

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Buy Team America? – Article by Gary M. Galles

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The New Renaissance Hat
Gary M. Galles
August 18, 2012
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Samuel Johnson once wrote that “patriotism is the last refuge of a scoundrel,” criticizing adverse policies and proposals falsely claimed to be based in patriotism. This has been most recently illustrated by the political furor over “made-in-China” Team USA uniforms. Many politicians asserted that it was un-American, with Senate Majority Leader Harry Reid saying those uniforms should be burned. Supposedly patriotic pressures to mandate “buying American” sprang up immediately, and Ralph Lauren quickly capitulated, promising to “go and sin no more.”

While some of the details of this flap are unusual, protectionism dressed up as patriotism follows a well-worn script.

Imports are found to cause some domestic harm. Given that those imports harm competing domestic producers, “Buy American” or some other version of protectionism is put forth as the patriotic response (with the producers seeking protection from superior competitors leading the patriotism bandwagon). The Team USA version simply exploits the Olympics’ peak in pro-American sentiment and symbolism to make the same case (though it makes no more sense than requiring that we grow our own coffee and bananas for our athletes).

The problem is that imports always harm competing domestic producers, so that the patriotism argument can always be used as political cover whenever any domestic producers get the government’s ear. And there are always politicians ready to listen.

One person who recognized the abuses and illogic of this approach was Leonard Read. In particular, his chapter “Buy American,” in Having My Way (1974), lays out a better way to approach the issue.

The admonition to “Buy American” has two diametrically opposed meanings. The first is its popular and mischievous meaning — shun goods produced in foreign countries. The second, and loftier meaning embodied in these words, is rarely mentioned or thought of — shun principles and practices alien to the American dream of limited government and personal freedom.

Producers who plead with consumers to “Buy American” are appealing to blind patriotism. Buy my product because it is made here; heed not its price or quality. This is sheer chauvinism. Suppose I were to urge your acceptance of my ideas, rather than those of Marx or Machiavelli, merely because of our differing nationalities. The absurdity of such an appeal is obvious: neither goods nor ideas are properly judged in this fashion; geographical origin has nothing to do with the matter.

Read points out that that the traditional use of “Buy American” is to justify some citizens beggaring their own neighbors, rather than something that advances any sensible interpretation of our general welfare. However, there is an interpretation that does advance our general welfare. Don’t buy (i.e., accept and make use of) actions that violate the American principle of freedom to choose your own productive associations, as long as you don’t violate the common, inalienable rights of others.

Read recognizes that whether a principle is true or not has nothing to do with where it comes from (i.e., ad hominem or “against-the-man” attacks do nothing to invalidate something that is true, although you wouldn’t know it from political rhetoric). As a result, he offers an excellent way to test whether some supposed general principle is valid — change “Buy USA” to “Buy Chinese” or “Buy Mexican,” and ask if Americans would accept the proposition as true based on their patriotism. If it is really a general principle, it is as valid for others in their dealings with us as their potential suppliers as it is for us in dealing with them as our potential suppliers, and the answer would not change. We would support others’ protectionism just as much as our own. But if it is really special pleading, rather than a general principle, people’s answers would change, as when people hypocritically attack other countries for their protectionism at the same time we defend ours as principled.

Read also recognized that the extent of protectionism is far vaster than most people recognize.

All obstacles to competition, be they foreign or domestic, are but variants of this theme.

The difference between a ban on buying a foreign country’s products and imposing tariffs, quotas, or any of a host of nontariff barriers is only one of degree. Whether it benefits or harms Americans does not change; only the degree of such benefit or harm. Similarly, change “Buy American” to “Buy Local,” as with locavore campaigns in agriculture, and the logic is equally invalid.

Such protectionism goes well beyond international trade, as well.

Change the wording to “Buy Union,” as with project labor agreements and prevailing (higher-than-competitive) wage laws, and the logic is the same. Union members are protected from the competition of other workers who would work for less. But that protection not only harms nonunion workers; it also harms customers, whose costs are increased.

Price controls are also protectionism. For example, a minimum wage protects other workers from competing with those who would be willing to work for less, but it harms both those denied their most productive employment and consumers.

The vast majority of antitrust cases are also forms of protectionism. They are not brought by consumers, who generally gain from the practices involved, but by outcompeted rivals who want to take away others’ advantages — advantages passed on to customers. Those outcompeted rivals don’t want potential customers to go elsewhere — and use antitrust to restrict consumers’ ability to access superior options.

A vast array of licensing schemes follows the same pattern. They hide behind masks of quality or safety but primarily keep new competitors out and keep those who would offer lower-quality–lower-price options some customers would prefer from doing so.

Leonard Read offers a powerful solution, powerfully illustrated by America’s own past.

Enough of this mischievous notion. Let us try instead to appreciate and “buy” the American ideal of freedom.

Ralph Waldo Emerson had this to say: “America is another name for opportunity. Our whole history appears like a last effort of divine Providence in behalf of the human race.”

As to the best in political economy, consider the Constitution of the United States. Regardless of its several flaws, no other nation’s charter has equaled it in an economic sense.

In what respect is this distinctively American? Here is the answer: “No state shall without the consent of the Congress, lay any imposts on imports and exports … “

In a nutshell, no tariffs, quotas, embargoes between the several states…the world has never known a free trade area as large as the U.S.A. when measured in value of goods and services produced and exchanged. Never perfectly free, but the nearest approximation to freedom!

In other words, the freedom to associate for productive purposes however and with whomever one chooses, because people were protected from many of the violations of that principle that governments have imposed throughout history, was the essence of the American miracle. And at its heart, as Thomas Jefferson wrote, was “the first principle of association, the guarantee to everyone the free exercise of his industry and the fruits acquired by it.”

Further, Read’s focus on America’s free internal trade offers a counterpoint to a frequent misinterpretation. Those who defend protectionism as a valid principle claim that it was the protectionism adopted by the United States in the form of tariffs that advanced our staggering early economic success. While it is true that import tariffs were imposed, and eventually dramatically raised (see the history of the “Tariff of Abominations” as an example), that was not the source of our success any more than hurdles — which slow running speeds — should be given credit for increasing running speeds because hurdlers are fast. The reality is that the positive impact of our massive internal free-trade zone and other constitutional restrictions on government interference far outweighed the negative impact of international-trade restrictions.

Read then addresses one particular common defense of protectionism: the “infant-industry” argument that free trade may be good in general, but that industries must be protected until they can grow to a scale where they can compete, which amounts to a claim that the benefits of freedom require restricting the freedom that generates them.

In reality, it is competition which protects “infant industries” — it protects them from stagnation and persuades them to grow.

In the absence of competition and freedom of transactions, producers stagnate. It is only when others are doing better that one attempts to overcome, to gain strength. Competition, combined with free exchange, makes strong giants out of weak infants — this is the password to economic opportunity and well-being — an American idea well worth buying.

Read recognized that from the perspective of consumers it is the competition that takes place without artificial assistance or restriction that expands their options the most. It does not matter whether competition leads to a foreign producer who offers better terms because of superior efficiencies or if that producer is American. So there is no reason to artificially nurture American infant industries (which often claim to be infants virtually forever), because it is the results of real superiority that benefit consumers, and artificially tilting the playing field only inhibits the process that best discovers and passes on the gains of such superiority.

Read next turns to another test that rejects the logic of protectionism. If we accepted protectionism in principle, we would be for it in all cases. But, as he notes, we are all free traders when it benefits us. In other words, we recognize that we gain from free trade, except when we are the one benefitted by special treatment — necessarily at others’ even greater costs — by those restrictions. We abandon our own revealed preference for freedom only when bribed by receiving some of what is essentially stolen from others.

Regardless of all the noisy arguments to the contrary, everyone known to me favors both competition and free trade. Name one who does not favor competition among those from whom he buys. Logically, then, how can one favor competition among millions of others and be against it for himself! This is irrationality, not disagreement.

Precisely the same can be said for free trade — domestic or foreign. Name one who would not welcome an order for his products from another country or county. Everyone favors exports. Imports? Favoring exports and objecting to imports is the same as favoring selling and objecting to being paid. This is an absurdity, not disagreement.

Leonard Read realized that the logic of protectionism is riddled with errors and that the practice of protectionism, in its myriad forms, is theft that impoverishes everyone except those bribed by the gains of their protected status and those whose political clout greases those transactions. It is a far cry from either liberty or justice for all. Read’s conclusion:

What then is meant by “Buy American” in its proper sense? Let willing exchange prevail among all people, locally and worldwide. Let each buyer or seller be guided by his own scale of values. Sell the American way and buy the American way — not as presently practiced, but as once prevailed and ought to be reinstituted. Keep ours the land of opportunity for everyone.

Gary M. Galles is a professor of economics at Pepperdine University. Send him mail. See Gary Galles’s article archives.

You can subscribe to future articles by Gary Galles via this RSS feed.

Copyright © 2012 by the Ludwig von Mises Institute. Permission to reprint in whole or in part is hereby granted, provided full credit is given.

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I’ve Got Olympic Fever – and the Only Cure is More Nationalism! – Article by Bradley Doucet

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The New Renaissance Hat
Bradley Doucet
August 17, 2012
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Once again, the Olympics have come and gone. Some of the best athletes from around the world competed to see who could run, swim, row, dive, jump, kick, shoot, spike, spin, flip, and twist faster or higher or more artfully than their opponents. And that part of it was great. Well, some of it was dull as dirt, but some of it was genuinely thrilling and even beautiful.The part of it that I don’t get is where I’m supposed to cheer for the guys and gals who are “representing” Canada. I’m supposed to feel disappointed when these fine young men and women fail to live up to expectations, and I’m supposed to be happy, even proud, when they make it to the podium. And people from other nations are supposed to feel these emotions for the athletes “representing” them. Well, not only do I not feel anything special for Canadian athletes, but I would go so far as to say that such seemingly innocuous nationalistic sentiments are a big part of what’s wrong with the world.Nationalism by Any Other Name

For my money, foul-mouthed stand-up comedian Doug Stanhope put it best: “Nationalism does nothing but teach you how to hate people that you never met, and all of a sudden you take pride in accomplishments you had no part in whatsoever…” Now granted, the Olympics are not so big on the hate. But why should I, simply because I’m Canadian, take pride in the fact that Canada hauled in 18 medals? And should I feel a little less proud because only one of them was a gold? Of course, strictly speaking, “Canada” did not win 18 medals. Rather, Canadian athletes won 18 medals. But why should “we” care one way or the other, much less feel vicarious pride? We didn’t build that.

To be clear, I’m not against sporting events per se. I actually like sports, both playing them and watching them. I like watching basketball and American football, and I even root for certain teams (the Celtics and the Patriots). I enjoy watching my fellow human beings perform incredible feats of strength and agility, and struggle to summon extra energy or settle frazzled nerves. Watching tennis star Na Li rally from a 1-5 deficit in the deciding third set of her semi-finals match at the Rogers Cup in Montreal this weekend to win six straight games and take it 7-5 was both exciting and inspiring. I like the way Na Li plays—I refuse on principle to place her family name first, regardless of what is done in her nation—and she’s got a pretty quick wit, too, judging from the times I’ve heard her speak. Why should I give a damn what her nationality is?

I did watch some Olympic tennis, including the record-breaking third set of the match between Milos Raonic and Jo-Wilfried Tsonga that took 48 service games to decide. I was impressed that Raonic could give Tsonga such a run for his money, but the fact that we are countrymen was the furthest thing from my mind. In fact, I was happy that Tsonga finally won the match. I enjoy his style of play, and he’s actually my favourite player on the men’s tour at the moment. Different nationality, different mother tongue, different skin colour? I literally could not care less.

The Hosts with the Most

What about the host country? In an article in the Globe and Mail, Doug Saunders wrote of the “mood of national euphoria” in England following the closing ceremonies, and of the “ineffable value of having organized a very large, very happy event with virtually no flaws, and having looked very good before the world—something that Britain once took for granted, and is likely to enjoy remembering for some time.” The implication is that Britain should feel proud of the great job it did hosting the Games.

But again, did “Britain” host the Games? Did “the British people” host the Games? No. Some small subset of specific individuals organized the event, for better or for worse. Why would every Brit deserve credit for that? Now, British taxpayers did foot the bill, whether they wanted to or not. And what a bill it was, totalling some $14.5 billion. (You can forget about any economic stimulus from hosting the Games, by the way. As Saunders tells it, the prospect of daily Olympic crowds of 100,000 kept at least 300,000 non-Olympic tourists away.)

Similarly, as a Canadian taxpayer, I financed some tiny fraction of the training of the Canadian athletes participating at these Games, who were subsidized to the tune of $96 million over the last four years. (For those of you keeping track at home, that’s five million and change per Canadian medal.) The thing is, paying taxes is not really something a person does; it’s something that is done to a person. I cannot therefore reasonably feel proud of what is done with those dollars once they are taken out of my account against my will, and neither should the British taxpayer.

For Love of Country

On a trip to Ottawa a few years ago, I saw a bumper sticker that captured my feelings about Canada: “I love my country, but I’m afraid of my government.” Canada is a fine place with many fine people who continue to enjoy the echoes of a strong classical liberal tradition. But those “representing” us (there’s that word again) in the halls of power are not generally speaking the finest of those fine people.

For one thing, they all seem to be nationalists of one stripe or another. I suppose it wasn’t surprising to see Pauline Marois, leader of the separatist Parti Québécois, celebrate the fact that Canada’s first four medals were won by Quebecers. Rather more disappointing was how all three major provincial party leaders were competing to oppose the purchase of homegrown Rona by US rival Lowe’s. The race for gold in the “economic nationalism” event was too close to call.

Someone is surely going to argue that the Olympics are all about the nations of the world coming together in friendship. Well first of all, at the risk of beating a dead dressage horse, “nations” cannot be friends. Only people can be friends, and some of the Olympians probably made some new connections. But do the Olympics help people from different parts of the world adopt friendlier attitudes toward one another? An American basketball team packed with NBA superstars rolling roughshod over every other team tells a different tale, as does the rash of below-the-belt punching in the quest for basketball gold. And how about those bad calls against the Canadian women’s soccer team, denying them a chance to play for gold? That really promotes friendly international relations.

One parting shot: I’ll take the human achievement of the Mars landing over the nationalistic achievements of the Olympics any day. And although again, the taxpayer funds used to pay for it rub me the wrong way, at $2.5 billion, the price tag was roughly 1/6 as large as the Olympic tab.

Some kind of reverence for imaginary lines on a map seems to be deeply ingrained in most people, but to me, honestly, winning a medal “for your country” is only slightly less creepy than winning one for your Dear Leader. I prefer the humanist sentiment of elation of one Western writer (I’ve tried in vain to relocate his name) who, upon seeing the Great Wall of China for the first time, exclaimed, “My people built that.” Human beings can do great things, which should be a source of encouragement and inspiration for us all, regardless of the colours of our passports.

Bradley Doucet is Le Quebecois Libré‘s English Editor. A writer living in Montreal, he has studied philosophy and economics, and is currently completing a novel on the pursuit of happiness. He also writes for The New Individualist, an Objectivist magazine published by The Atlas Society, and sings.

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Legalize Competing Currencies – Article by Ron Paul

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Categories: Economics, Politics, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

The New Renaissance Hat
Ron Paul
August 16, 2012
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I recently held a hearing in my congressional subcommittee on the subject of competing currencies.  This is an issue of enormous importance, but unfortunately few Americans understand how the Federal Reserve and Treasury Department impose a strict monopoly on money in America.

This monopoly is maintained using federal counterfeiting laws, which is a bit rich.  If any organization is guilty of counterfeiting dollars, it is our own Treasury.  But those who dare to challenge federal legal tender laws by circulating competing currencies – at least physical currencies – risk going to prison.

Like all federally created monopolies, the federal monopoly on money results in substandard product in the form of our ever-depreciating dollars.

Yet governments have always sought to monopolize the issuance of money, either directly or through the creation of central banks. The expanding role of the Federal Reserve in the 20th century enabled our federal government to grow wildly larger than would have been possible otherwise.  Our Fed, like all central banks, encourages deficits by effectively monetizing Treasury debt.  But the price we pay is the terrible and ongoing debasement of our money.

Allowing individuals and business to use alternate currencies, especially currencies backed by gold and silver, would expose the whole rotten system because the marketplace would prefer such alternate currencies unless and until the Fed suddenly imposed radical discipline on its dollar inflation.

Sadly, Americans are far less free than many others around the world when it comes to protecting themselves against the rapidly depreciating US dollar.  Mexican workers can set up accounts denominated in ounces of silver and take tax-free delivery of that silver whenever they want.  In Singapore and other Asian countries, individuals can set up bank accounts denominated in gold and silver.  Debit cards can be linked to gold and silver accounts so that customers can use gold and silver to make point of sale transactions, a service which is only available to non-Americans.

The obvious solution is to legalize monetary freedom and allow the circulation of parallel and competing currencies.  There is no reason why Americans should not be able to transact, save, and invest using the currency of their choosing.  They should be free to use gold, silver, or other currencies with no legal restrictions or punitive taxation standing in the way.  Restoring the monetary system envisioned by the Constitution is the only way to ensure the economic security of the American people.

After all, if our monetary system is fundamentally sound– and the Federal Reserve indeed stabilizes the dollar as its apologists claim–then why fear competition?  Why do we accept that centralized, monopoly control over our money is compatible with a supposedly free-market economy?  In a free market, the government’s fiat dollar should compete with alternate currencies for the benefit of American consumers, savers, and investors.

As Austrian economist Ludwig von Mises explained, sound money is an instrument that protects our civil liberties against despotic government. Our current monetary system is indeed despotic, and the surest way to correct things simply is to legalize competing currencies.

Representative Ron Paul (R – TX), MD, is a Republican candidate for U. S. President. See his Congressional webpage and his official campaign website

This article has been released by Dr. Paul into the public domain and may be republished by anyone in any manner.

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Moving Toward War in Syria – Article by Ron Paul

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Categories: Politics, Tags: , , , , , , , , , , , , , , ,

The New Renaissance Hat
Ron Paul
August 6, 2012
Recommend this page.
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Last week the House passed yet another bill placing sanctions on Iran and Syria, bringing us closer to another war in the Middle East. We are told that ever harsher sanctions finally will force the targeted nations to bend to our will.  Yet the ineffectiveness of previous sanctions teaches us nothing; in truth sanctions lead to war more than they prevent war.

Until last year, Libyan sanctions were touted as a great success story.  The regime would change its behavior. Yet NATO bombed the country anyway.

Last week we learned that President Obama signed an intelligence “finding” directing the CIA to covertly assist rebels in Syria. The administration seems determined to fight yet another war in Syria that has nothing to do with American national interests.
We already know that a similar “finding” was signed under the latest Bush administration directing US intelligence to undermine the Iranian government and promote regime change there. Neoconservatives have long demanded that we overthrow the Syrian government before moving on to war against Iran.  This bellicosity continues regardless of which party is in the White House.

In Syria we see once again we see how our interventionist policies backfire and make us less secure.  Recent news reports point to ties between the Syrian opposition and al-Qaeda (and other extremist groups).  A recent article in the Guardian, a British newspaper, exclaimed that, “Al-Qaida turns tide for rebels in battle for eastern Syria.”  The article quotes an al-Qaeda leader in Syria saying that he meets with the main US-backed Syrian rebel organization, the Free Syrian Army, “almost every day.”  So by promoting civil war in Syria we end up fueling al-Qaeda.

According to another recent press report, German intelligence services estimate that nearly 100 terrorist attacks have been committed by al-Qaeda or related organizations in Syria over the past six months. Last month a suicide bomber in Syria killed a defense minister and several top government officials. The US government, which has been fighting a “War on Terror” for more than a decade now, refused to condemn that act of terrorism.

This raises the question of whether the US administration is supporting the same people in Syria that we have been fighting in Iraq and Afghanistan. Secretary of State Hillary Clinton expressed these same concerns earlier this year when asked whether the US has been reluctant to arm the Syrian rebels. She answered, “To whom are you delivering them? We know al-Qaida. Zawahiri is supporting the opposition in Syria. Are we supporting al-Qaida in Syria?”

That is a very good question.  It clearly demonstrates that the United States has no business at all being involved in the Syrian civil war. In the 1980s we supported a resistance movement in Afghanistan that later gave birth to elements of al-Qaeda and the Taliban. When will we learn our lesson and stop intervening in conflicts we don’t truly understand, conflicts that have nothing to do with American national interests?

Representative Ron Paul (R – TX), MD, is a Republican candidate for U. S. President. See his Congressional webpage and his official campaign website

This article has been released by Dr. Paul into the public domain and may be republished by anyone in any manner.

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Mass Production and the Emerging Cultural Differentiation – Article by G. Stolyarov II

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The New Renaissance Hat
G. Stolyarov II
August 5, 2012
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I was recently asked: “But doesn’t mass society make even the atypical dress of [previous eras] unavailable to anyone?  Haven’t we had a kind of widespread proletarianization?“

The question presupposed a particular phase of mass production – one that has largely elapsed. When an extreme scarcity of resources still exists, as it did during the early Industrial era, only a few very basic products can be created, and the incentive for businesses is to make them in as high of a volume as possible, to market to as many people as possible without much concern for product differentiation, or esthetic considerations. (Think of the output of the early cotton mills, or the Ford Model T as examples of this.) The early industrial stage massively raises the living standards of most, simply because they can now have goods such as durable clothing, furniture, and (eventually) transportation and appliances – which were simply not available in any form to the majority of people previously. The same can be said of mass culture during the early days of recorded media. The complaint regarding the crudity and proletarization of mass media is not new. In fact, even Ludwig von Mises brought it up in 1954.

People of erudition and exquisite taste were the minority in every age – but what was new in the early 20th century was that, once the basic material sustenance of most in the Western world was achieved, the early mass-production stage became focused on culture (or “culture” – as you will) instead. At the same time, there came about a massively greater differentiation of physical products in the late 20th century, so that people can much more readily customize their living spaces, for instance. With the advent of electronic media, the prospects for cultural differentiation at relatively low cost have also become much more realistic. Consider that, back when I was a poor college student, the Internet enabled me to locate and afford numerous aspects of my quite extensive and unconventional attire.

We are just now coming into a new era of decentralized production of culture, aided by new electronic technologies that make creation much more convenient, as well as funding platforms (e.g., Kickstarter) that enable new forms of distributed patronage. As an example, I recently conducted a successful experiment where I was able to create a new musical composition and obtain some modest funding via Kickstarter, while releasing the work to my audience for free under a Creative Commons License. I am also technically able to create more such works for no compensation, so it is just a matter of having enough leisure time and inclination (of which I have more than a person in my economic situation would have had in earlier eras). I think many other people will increasingly come to be a in a similar position, triggering a new Renaissance of high culture.

The questioner also asked: “This [ability to use technology to compose more easily] is all true, of course, but do we have any Bachs or Mozarts? Is there anything even approaching late nineteenth-century Vienna, where there were multiple great composers within miles of each other?”

Perhaps such an era is soon to come – except the proximity of the composers will not need to be physical. The Internet and electronic composition programs will enable composers throughout the world to become aware of one another and to communicate and collaborate. The biggest barrier to such collaborations in recent years has been the copyright system and its draconian enforcement by American media/entertainment-industry interests. The advent of the Creative Commons License and similar alternatives to traditional copyright can largely solve this problem and create a far more refined culture that does not rely on the mass-distribution system of the large recording and film studios.

I hesitate to make any comparisons to Bach or Mozart – but there are certainly some promising composers out there. For just two examples, I refer you to the work of Maxwell Janis and Simone Stella. (Look for his original compositions, such as this one.)

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