By Chris Rossini
During the last Republican Presidential debate, Marco Rubio made a statement that is worth putting under the microscope:
What makes America special is that we have millions and millions of people that are not rich, that through hard work and perseverance are able to be successful.
What made America special at the very beginning was individual liberty. Government was minuscule at first, and the Founders (for the most part) hoped that it would stay that way. Government was to be in the background, and not in everyone's face. Americans were free to create, trade, travel, and live as they wished. It didn't matter if they were rich or poor. It didn't matter if they "worked hard" or not.
That is what made America special.
"Hard work" and "perseverance" are not unique to America. People work themselves to the bone all over the world. The difference was that, in America, if you were good at satisfying consumers, and you profitably took advantage of opportunities, the government wouldn't rob you blind as a result. All throughout history, governments and their dependants lived off the work of the productive. In America, at the beginning, such parasitic behavior didn't exist.
For example, Benjamin Franklin once wrote:
“We have no poor houses in the Colonies; and if we had some, there would be nobody to put in them, since there is, in the Colonies, not a single unemployed person, neither beggars nor tramps.”
Now, were there really no unemployed people? That's doubtful. But the key takeaway from Franklin's statement was that people did not live off their neighbor's earnings. Compare that today, where there are "beggars and tramps" everywhere....And that's with the biggest government and welfare state in the history of the world.
Rubio links "hard work" with being "successful," but this is a common error as well. One becomes successful by satisfying the most urgent wants and desires of the many. While that often does require hard work, it is not a prerequisite.
There are plenty of people who miscalculate consumer desires. They create things that others don't want to buy or pay for. They are unsuccessful despite working as hard as they could. There is no doubt that Bernie Sanders works very hard. But he can never (ever) make socialism work no matter how many hours he puts in.
America's uniqueness was liberty, not some generic term called "hard work."
Rubio then complains that even though people are working "hard as ever" the "economy is not providing jobs that pay enough." This is riddled with errors. First of all, there is no such entity called "the economy" that sits there and "provides jobs."
The economy simply exists. What government does to the economy is the real culprit to disaster.
Thomas Nixon Carter wrote in the 1920's:
“In the absence of force, peace and liberty simply exist; they do not have to be created or supported…In the absence of force, capitalism automatically exists in the same sense that peace and liberty automatically exist.”
In early America, government was largely hands off. People did not sit around wondering if a central planner named Janet Yellen would raise interest rates. Nor did they look to some politician to "create jobs". Such nonsense was nonexistent.
Today, government has its dirty claws in almost every move that's made. Licenses, subsidies, monopoly privileges, red tape, bureaucracy, permits, "regulations"...Government has taken an economy (that simply exists) and has turned it into a gordian knot. It has twisted economic life into a pretzel.
Our troubles have nothing to do with hard work, but have everything to do with government intervention. Government must be peeled away in order to bring back the conditions that produce prosperity. Everyday, a thousand new pages of regulations are created to further squeeze the life out of us.
That has to change.
By Jeff Deist
This article is adapted from a talk delivered at this past weekend's Mises Circle event in Phoenix.
The topic of our symposium this morning is “What Must Be Done,” which originally was the title of a talk given by Dr. Hans-Hermann Hoppe at a Mises Institute conference in 1997. Hoppe posed his title as a declarative, but it's also the question we all wrestle with as libertarians in a world so dominated by the state and its apologists.
And it’s a question we hear time and time again at the Mises Institute: What can we do to fight back against government? We all understand the problem, but what is the solution? What can we do in the current environment to help build a more sane and libertarian world? And how can we find some measure of freedom in our lives today, to live more freely in our lifetimes?
Four Common Strategies
When libertarians talk about what must be done, the discussion tends to revolve around four common strategy options. None of them are mutually exclusive necessarily and there can be plenty of overlap between them.
1. The Political Option
The first, we’ll call the political option, or to borrow a tired phrase, “working within the system.”
The argument goes something like this: government, and the political process that surrounds it, are inevitable in the real world. Therefore libertarians must not stand idly on the sidelines while politicians inexorably steal our freedoms. Instead we must organize and become active politically, under the banner of a third party vehicle like the Libertarian Party or by working within the Republican Party, because whether we want to involve ourselves with politics, politics involves itself with us.
Political action can be viewed as a form of self-defense. This approach usually has a national focus — such as running a presidential candidate — though it contemplates political action at the state and local level as well. It appeals to libertarians in a hurry, so to speak. Ultimately, at least in theory, the political option attempts to mimic and reverse the incrementalism that has been so successful for the political Left over the past century.
Let me say that the political option, at least in terms of national politics, strikes me as the least attractive alternative among those available to us today.
The amount of time, energy, and human capital that have been invested trying to win political and legislative battles is staggering, but what do we have to show for it? The twentieth century represents the total triumph of Left progressivism in the political sphere: central banking, income taxes, the New Deal, and Great Society entitlement schemes were all enormous political victories that changed the landscape forever. Everything has become politicized: from what bathroom transgender people should use to whether online fantasy football should be allowed. Progressives frame every question as “What should government do?”
So we need to understand the political option within the context of the progressive triumph.
2. Strategic Withdrawal
A second approach libertarians often consider might be loosely termed strategic withdrawal. You may have heard of the “Benedict option” being discussed by Catholics unhappy with the direction of the Church and the broader culture. Ayn Rand fans talk about “going Galt,” in reference to the strike by the productive class that takes place in Atlas Shrugged.
This approach involves separating, withdrawing, or segregating in some way from the larger society and political landscape. It asserts that the current environment is largely hopeless for libertarians politically and culturally, and therefore attempting to play the game where the rules are so heavily slanted in favor of the state is foolish.
It’s better to retreat, at least for now, and build a life outside the state’s parameters to the extent possible. In this sense the withdrawal option is tactically appealing: like certain martial arts, it attempts to deflect and redirect a greater force, rather than face it head on.
A strategic withdrawal can take many forms across a range of alternatives, from absolute separation to quite subtle lifestyle changes. In some cases this strategy can mean actually physically uprooting where one lives and works. We have examples like the Free State Project in New Hampshire or Liberland in Europe, along with various seasteading proposals and attempts to create libertarian homesteads in Central and South America.
But withdrawal can take other forms. Some libertarians choose to live off the grid, both literally and metaphorically. The prepper movement represents a form of strategic self-sufficiency, as does simply choosing to move to a rural or remote area.
Withdrawing from the American way of endless consumption and debt — “living small” — offers another form of strategic retreat, and often allows libertarians not only to lead happier lives, but also minimize or avoid the state’s regulatory and tax clutches.
Of course, homeschooling represents one of the greatest examples of libertarian strategic withdrawal in the modern age, enabling millions of kids and parents to escape the state education complex. And withdrawal can be as simple as abandoning state media or unplugging from the digital white noise that surrounds us.
Finally, expatriation — voting with one’s feet — is a time-honored historical strategy for removing oneself from a tyrannical state. This happens domestically in the US, with people fleeing high tax states, as well as across borders. I’m sure many people in this room have at least considered leaving the US, and increasing numbers of Americans are not only doing just that, but renouncing their citizenship as well. Who could judge a young person today who looks around and decides to leave the US for greener, or freer, pastures?
3. Hearts and Minds
A third tactic that libertarians often advocate we might call “winning hearts and minds.” This approach is multi-pronged, involving education, academia, traditional and social media, religion, books and articles, literature, and even pop culture. Hearts and minds is why we hold conferences like this. The hearts and minds strategy is all about education, persuasion, and marketing, at every level. And it’s the approach through which I think the Mises Institute has made the most headway.
A hearts and minds strategy argues that no change can occur unless and until a significant portion of a given population shrugs off its bad ideas and embraces sensible ideas, particularly in the areas of politics, economics, and social theory. Politics is a lagging indicator, and it follows downstream from culture. We should focus on the underlying disease, not the symptoms. Just as Left progressives have captured the institutions of the West — academia, news media, government, churches, Hollywood, publishing, social media — libertarians ought to focus our efforts on reclaiming these institutions for liberty and a brighter future. So it makes sense to launch liberty-minded people into the streams of academia, business, media, and religion. This is how we strike the root, or at least chip away, at the mindset that supports the state.
Clearly a wholesale attack on these institutions is a daunting task. It’s a long game. But the argument goes like this: until we win hearts and minds, it scarcely matters whom we elect, what bill gets passed, or how we arrange our personal and professional lives. The same statist mentality will surface time and time again to work against us.
Surely the state’s education racket offers the ripest target for this approach. As public schools deteriorate into mindless PC zones, and as universities continue to produce heavily indebted graduates with uncertain job prospects, it becomes increasingly obvious to the public that the whole model is unsustainable.
That’s why we have an opportunity like never before to appeal directly to the intelligent lay audience, and bring Austrian economics and libertarian theory to the masses at very little cost. The digital revolution has been the great leveler, and we should use it to its full advantage in changing as many hearts and minds as possible.
But this strategy is not for the faint of heart, and it doesn’t promise a quick fix. It’s a strategy for sober people with long time horizons.
Of course another strategy often discussed among libertarians involves simple resistance to the state, whether open or covert. This tactic contemplates actions like civil disobedience, tax protests, evading or ignoring regulations, and engaging in agorism and black markets.
It also contemplates the use of technological advances to advance freedom. “Third way” libertarian technologists promote this approach, citing advances like encryption, cybercurrencies, and platforms like Uber — all of which when first developed existed in a sort of grey area as regards their legality.
Agorism was the preferred approach of the late libertarian theorist Sam Konkin, who encouraged people to bypass the state by devoting their economic lives to black-market or gray-market activities, thus avoiding taxation and regulation and helping to shrink the beast. Konkin called it “counter-economics.”
Agorism and its variants was critiqued by Murray Rothbard, who found Konkin’s antipathy to wage labor and “white markets” as anti-market: after all, what does agorism offer the vast majority of wage workers? And who will provide “legitimate” goods and services like automobiles and steel? Rothbard saw agorists as “neglecting the overwhelming bulk of economic life to concentrate on marginalia.”
And let’s be frank: the notion of living an agorist’s life in the shadows, without, for example, having a driver’s license or owning real estate, might not hold mass appeal.
As for applying new technology to bypass the state, I’m all for it. Any innovation that makes it harder for the state to govern us, as a practical matter, is something to be celebrated. But we should guard against false hope: the same technology which serves to facilitate privacy or title transfers or stealth movement of money or people can be exploited by the state’s spying apparatus. And no innovation can change the fundamental questions of whether and how human affairs should be organized by the state.
So these four basic approaches — politics, withdrawal, “hearts and minds,” and resistance — provide us with a framework to consider, in an unfree world, what must be done.
These questions bring us back to Professor Hoppe and his aforementioned speech. I encourage you to read it, it’s a fascinating topic and his treatment of it is razor-sharp.
Keep in mind that when Hoppe delivered his talk in 1997, the digital revolution was still in its infancy. Social media and mobile devices did not exist. Several precipitating events — the introduction of the euro, the September 11th attacks, the wars in Iraq and Afghanistan, the Crash of 2008, Greenspan and Bernanke’s monetary hyperdrive, the rise of Obama, and the full contagion of PC in the West — had not yet occurred.
Each of these events intensified the growth and scale of centralized government power. But even in what now seems like the carefree year of 1997, Hoppe’s explicit focus was the fundamental fight against any and all centralized political power.
The Problem of Centralization
And, in fact, decentralization is a linchpin that connects each of the four tactical approaches mentioned earlier. If there is one principle, and only one principle, that libertarians ought to apply when considering strategy, it is this: radical decentralization of state power must be our relentless goal.
The twentieth century, the Progressive century, witnessed the unprecedented centralization of political and economic power in the hands of the political class. We see this in Washington DC, in Brussels, at the UN, at the Fed, at the European Central Bank. Our overriding goal therefore must be the reversal of this terrible trend to create a critical mass of “implicitly seceded territories.”
Hoppe prescribes a bottom up strategy that identifies natural elites not found among the political class, its court intellectuals, or its state-connected allies. These elites are simply accomplished, upstanding local citizens. These natural elites form the counterbalance to the parasitic centralizers, and serve as the vanguard of the bottom up revolution.
Hoppe’s posits three strategic keys for this revolution:
Let me conclude with a quote from Rod Dreher, writing in The American Conservative about the Benedict option I mentioned earlier:
Rome’s collapse meant staggering loss. People forgot how to read, how to farm, how to govern themselves, how to build houses, how to trade, and even what it had once meant to be a human being.
Has the world fallen so far into reflexive statism that we have forgotten how to be free? Are we living, like Benedict says, on the edge of a new dark age? Or is a revolution, a radically decentralized Hoppean “bottom up” revolution brewing? Is the pushback we see all around the world — against central states and their cobbled together borders, against political elites, against the UN and the IMF, against the euro, against taxpayer bailouts, against cronyism, against PC, against manufactured migration, and against drug laws, a last gasp? Or the sign of worldwide movement toward political decentralization?
Finally, let us remember that every society worth having, every advanced liberal society, was built by people with long time horizons. Horizons beyond their own lives. And generally those societies were built under very difficult circumstances and conditions of material hardship far beyond what we’re likely to face. So let’s appeal to our better natures and turn “What Must be Done” from a question into a declaration.
This article was originally published at The Mises Institute.
By Ron Paul
Last week Federal Reserve Chair Janet Yellen hinted that the Federal Reserve Board will increase interest rates at the board’s December meeting. The positive jobs report that was released following Yellen’s remarks caused many observers to say that the Federal Reserve’s first interest rate increase in almost a decade is practically inevitable.
However, there are several reasons to doubt that the Fed will increase rates anytime in the near future. One reason is that the official unemployment rate understates unemployment by ignoring the over 94 million Americans who have either withdrawn from the labor force or settled for part-time work. Presumably the Federal Reserve Board has access to the real unemployment numbers and is thus aware that the economy is actually far from full employment.
The decline in the stock market following Friday’s jobs report was attributed to many investors’ fears over the impact of the predicted interest rate increase. Wall Street’s jitters about the effects of a rate increase is another reason to doubt that the Fed will soon increase rates. After all, according to former Federal Reserve official Andrew Huszar, protecting Wall Street was the main goal of “quantitative easing,” so why would the Fed now risk a Christmastime downturn in the stock markets?
Donald Trump made headlines last week by accusing Janet Yellen of keeping interest rates low because she does not want to risk another economic downturn in President Obama’s last year in office. I have many disagreements with Mr. Trump, but I do agree with him that the Federal Reserve’s polices may be influenced by partisan politics.
Janet Yellen would hardly be the first Fed chair to allow politics to influence decision-making. Almost all Fed chairs have felt pressure to “adjust” monetary policy to suit the incumbent administration, and almost all have bowed to the pressure. Economists refer to the Fed’s propensity to tailor monetary policy to suit the needs of incumbent presidents as the “political” business cycle.
Presidents of both parties, and all ideologies, have interfered with the Federal Reserve’s conduct of monetary policy. President Dwight D. Eisenhower actually threatened to force the Fed chair to resign if he did not give in to Ike's demands for easy money, while then-Federal Reserve Chair Arthur Burns was taped joking about Fed independence with President Richard Nixon.
The failure of the Fed’s policies of massive money creation, corporate bailouts, and quantitative easing to produce economic growth is a sign that the fiat money system’s day of reckoning is near. The only way to prevent the monetary system’s inevitable crash from causing a major economic crisis is the restoration of a free-market monetary policy.
One positive step Congress may take this year is passing the Audit the Fed bill. Fortunately, Senator Rand Paul is using Senate rules to force the Senate to hold a roll-call vote on Audit the Fed. The vote is expected to take place in the next two-to-three weeks. If Audit the Fed passes, the American people can finally learn the full truth about the Fed’s operations. If it fails, the American people will at least know which senators side with them and which ones side with the Federal Reserve.
Allowing a secretive central bank to control monetary policy has resulting in an ever-expanding government, growing income inequality, a series of ever-worsening economic crises, and a steady erosion of the dollar’s purchasing power. Unless this system is changed, America, and the world, will soon experience a major economic crisis. It is time to finally audit, then end, the Fed.
By Ron Paul
If there's ever been a law terribly abused by government, the authority to use military force after 9/11 is surely one of them. Article I of the U.S. Constitution is not a set of suggestions! The Constitution is the law of the land, and if government disobeys it, they are quite frankly breaking the law!
Let's hypothetically say that a resolution was passed that miraculously repealed the President's authority to use military force. I personally wouldn't feel much better because there is so much secrecy with the CIA and special forces.
Authority is crucial, and a lot of blame must be pinned on sloppy thinking and internationalism. Despite the fact that the UN was established to bring peace in the world, one of their very first actions was to give authority for war in Korea. The U.S. is still spending money on that decision.
Even with a Presidential election coming up, there is virtually no debate on this issue. At least my son Rand has introduced a bill to repeal the President's authority to use military force. Even when it was discussed during Obama's election campaign, he promised to stop the wars. Instead, he didn't stop two wars and added another one!
Restraining leaders from going to war was a big issue during our revolution. The king (today our king is the President) can't go to war without the consent of the people through the legislative branch. We may have a long way to go, but the majority of the American people agree that we should not go to war so carelessly.
Thank you, and be sure to tune in to tomorrow's Liberty Report!
By Samuel Bryan
On Monday, the United States national debt increased $339 billion.
In one day. Just like that.
What caused the sudden spike?
That same day, President Obama signed a bill into law suspending the debt ceiling until March 15, 2017. That allows the government to once again borrow, free from the constraints of an $18.1 trillion ceiling.
As USA Today reports, the bill not only suspended the debt ceiling, it also set the federal budget for fiscal years 2016 and 2017, and lifted budget caps to boost spending for military and domestic programs by a total of $80 billion over two years.
From a political standpoint, the budget deal avoided a showdown between Obama and Republicans on the debt ceiling and erased the threat of a government shutdown – at least for the next two years.
In other words, Congress and the president kicked the can down the road.
“It is a signal of how Washington should work,” Obama said.
Free of its constraints, the federal government immediately set about piling on some more debt. According to a website that tracks the debt, the US government owed $18.153 trillion last Friday. On Monday, the number stood at a cool $18.492 trillion.
The sudden increase has to do with what are known as “extraordinary measures” that keep the government afloat once it hits the debt ceiling. These include delaying issuance of certain debt instruments, suspending investments in federal employee pension funds, a moratorium on deposits from state and local governments, and drawing down a $23 billion currency stabilization fund.
According to the Washington Examiner, the Bipartisan Policy Center estimated that the government had somewhere around $370 billion worth of extraordinary measures to use once it butted up against the $18.1 trillion ceiling earlier this year.
Extraordinary measures allow the government to limp along temporarily. Once the cap is lifted, the government scrambles to mitigate the effects of the extraordinary measure, and viola – massive, virtually instantaneous debt increase.
So what does this mean practically speaking?
As Peter Schiff pointed out recently on Fox Business’ Closing Bell with Liz Claman, “The cost of government is not what it taxes, but what it spends.”
Allowing the government to blow past mythical debt ceilings may enable politicians to avoid uncomfortable political clashes, but in the real world, it merely facilitates a dysfunctional economic policy of spending and borrowing and spending and borrowing.
As both David Stockman and Peter Schiff have pointed out, that US debt is a massive bubble waiting to burst. Stockman made the case recently on CNBC.
We’re going to have a shutdown sooner or later. We’re on the fiscal Titanic, and we’re going to hit something hard and immoveable one of these days. We’re in month 75 of this so-called recovery. Congress has squandered the entire time, done nothing about the long-run fiscal outlook. If anything, they’ve basically been trying to find ways to get out from under the caps they put on themselves in 2011.
The massive debt also has ramification on the Fed’s quest to raise interest rates. Simply put, it can’t do it. Sustained higher interest rates would increase the burden of debt service. Peter Schiff made this point back in September at the Jackson Hole Summit.
Janet Yellen actually said, ‘We are going to shrink the balance sheet down to $1 trillion by the end of the decade.’ Yeah, good luck with that. It hasn’t shrunk at all since she made that promise about a year ago… How are you going to raise interest rates now that you’re so addicted? How much more debt do we have today than we had seven years ago? How much painful is it going to be to try to service that debt if interest rates go up? The truth of the matter is interest rates have to stay at zero, because that’s all we can afford…
All of this means nothing to politicians though. They rarely look past the next election cycle. With the lid off, the debt will continue to skyrocket. Congress will continue to spend. Business as usual will continue – until it can’t any longer.
Reprinted with permission from SchiffGold.com
By Ron Paul
Like thieves in the night, Congress recently raided the Social Security Trust Fund to the tune of $150 billion. In this video my son Rand addresses government's addiction to stealing money from Social Security, so that it may be spent today:
By Thomas E. Woods, Jr.
Thanks to the fundraising and polling success of Senator Bernie Sanders, socialism has become increasingly fashionable in the United States, particularly among young people. Because people are treating Sanders’ old ideas as if they’re just the kind of bold and fresh thinking America needs, I’ve released a free eBook refuting them called Bernie Sanders Is Wrong. Whether it’s trade, “inequality,” alternative energy, the $15 minimum wage, greater fringe benefits for workers, or why the Scandinavian model is supposed to be such a great example for America, Sanders is indeed deeply wrong, and my free book will show you why. Download it as a PDF, EPUB, or for your Kindle.
Let’s consider just one issue in a bit of detail: the so-called gender pay gap, which Sanders has repeatedly denounced. We’re told that women are paid only 77% of what men are, and we’re left to insert the words “for doing the same work.” But in fact, they’re not doing the same work, and that’s kind of the point. The 77% figure comes from aggregating hours worked at all jobs by women and men and then dividing the one into the other. When the result is less than 100%, we are to conclude that the cause must be “sexism.”
But get this: to arrive at this figure, you have to disregard the number of hours worked by women compared to the number of hours worked by men! You think that might be a variable worth incorporating?
Supporters of the gender pay-gap theory say they are incorporating hours worked – why, we’re comparing full-time female workers with full-time male workers! Except they neglect to mention that the Bureau of Labor Statistics considers anyone working at least 35 hours per week to be a full-time worker. Well, there’s a lot of variation in there! Women are much more likely to be on the lower end of that spectrum – 12% of women are working just 35 to 39 hours per week, while only five percent of men are working that little.
On the other hand, 26% of men are working more than 40 hours per week, while only 14% of women are.
Factor in these differences in hours worked, the so-called 23 percent pay gap drops all the way to 12 percent. With just that one adjustment. Let me repeat: the gender pay-gap liars aren’t even accounting for the number of hours women work as compared to men.
And by the way, you know what prominent institution in America also has a 12 percent gender pay gap? The Obama White House. When confronted with this statistic, Jay Carney simply explained that women and men have different jobs in the White House, a defense he seems unwilling to accept from every ordinary employer in the country.
As for the rest of the pay gap, it can be accounted for by means of entirely benign explanations, as the book explains.
Oddly enough, I have found even some libertarians who are quick to defend Sanders on the grounds that there’s a lot of cronyism in the American economy that we should all oppose. No doubt. But Sanders is not making any such fine distinctions. It is capitalism, not cronyism, he is attacking, and it doesn’t do anyone any good to pretend otherwise.
Now to criticize Bernie Sanders is not in any way to suggest that his main rival, Hillary Clinton, is any better. I’m focusing on Sanders for this reason: nobody considers Hillary an idea person, blazing an independent trail and offering fresh, exciting, and radical proposals. But that is precisely how people are being encouraged to think of Bernie Sanders, which is what makes him so dangerous. Get your free copy of Bernie Sanders Is Wrong (PDF, EPUB, or Kindle; as usual, right-click and save the file to your device) and push back against the ongoing rehabilitation of socialism.
By Ron Paul
I had a great talk with Kennedy on U.S. involvement in Syria. We also addressed the silly notion that Paul Ryan will be a libertarian-type Speaker of the House. Ryan is an interventionist and big spender. We can confidently expect more of the same.