In this thread on mises.org, someone was asking about the evils of lobbying. Someone pointed out "Distributed Costs and Concentrated Benefits" as the reason lobbying the State for favors is profitable.
Here's a good example of "Distributed Costs and Concentrated Benefits". Consider the taxi medallion licensing cartel in NYC.
There are a fixed number of taxi medallion licenses. They can be bought and sold. Recently, one traded for approximately $1M. There are approximately 13,000 medallion licenses.
The taxi medallion license holders own a State-backed monopoly/oligopoly worth approximately $13B.
The supply of taxi licenses is restricted. The net effect is that you can only get a taxi at the airport or in busy parts of Manhattan.
Occasionally, there is a proposal to increase the number of medallion licenses. The taxi medallion license holders, with a $13B State-backed cartel, can afford to spend a few million dollars lobbying against changing the law.
As an individual, it doesn't pay for me to spend money lobbying *FOR* more medallion licenses. Instead, I pay a couple of dollars more whenever I need a taxi, or I use another form of transportation.
There are are small handful of people who benefit from the taxi licensing cartel, the current medallion owners. Everyone else pays higher prices when they take a taxi, or a taxi is not available at all.
The medallion owners collect economic rent. Everyone else suffers.
The NYPD occasionally arrests someone for operating a taxi without a license. Due to lobbying by the medallion owners, a handful of police are dedicated to enforcing the cartel.
If the taxi medallion owners had to maintain their own private army of armed thugs to enforce their cartel, then it wouldn't be profitable. Instead, this cost is externalized to the State.
This sort of thing occurs in *EVERY* industry. If you add them all up, it's a huge increased cost and wasted resources. If everyone else is lobbying the State for favors, but you aren't, then you're at a huge disadvantage.
Thursday, December 31, 2009
In this thread on mises.org, someone was asking about the evils of lobbying. Someone pointed out "Distributed Costs and Concentrated Benefits" as the reason lobbying the State for favors is profitable.
Wednesday, December 30, 2009
There was an interesting point about Sunday's NFL game between the Colts and Jets. The Colts' coach Caldwell pulled his starters at the end of the game. This led to the Jets winning the game and ended the Colts' attempt for a 16-0 regular season.
It was interesting to see the mainstream media decry Caldwell for doing this. If the headline were instead "Peyton Manning has season-ending injury in the 4th quarter!", then the outcry would have been the opposite "He should have rested his starters!"
It's an example of judging by outcomes and not correct odds. Caldwell benched his starters and lost the game. Therefore, he made the wrong decision. If a key player were injured in the 4th quarter, then he also would have made the wrong decision. If the backups won the game anyway, nobody would have complained.
There's also another subtle point. The newspapers most critical of the Colts were those in Denver and Pittsburgh.
If Denver of Pittsburgh make the playoffs, then they might have won their first game and played the Colts in the second round. If the Colts' coach thinks that Denver or Pittsburgh are tough playoff opponents, then it's in his rational self-interest to lose to the Jets on purpose. By losing the game, he maximizes his chance of winning the Super Bowl.
This type of problem is called "Sportsmanlike Dumping". If you maximize your chance of winning the tournament by losing a game, then you should lose the game. It doesn't matter if this adversely affects other teams' chances, like Denver or Pittsburgh. It's their own fault for already having lost so many games.
This logical problem happens anytime you have multiple qualifiers for a playoff. A team that's already clinched its playoff spot and seed might have an incentive to lose on purpose. This lets an easy opponent into the playoff and keeps out a harder opponent.
This logical contradiction is inevitable whenever you have a regular season with multiple qualifiers for a playoff. A reasonable answer is "The Colts earned the right to lose a game on purpose without adversely affecting their seed, because they won their first 14 games." I didn't see this point mentioned in any mainstream media discussion of the game.
A similar logical contradiction will happen in Sunday's game between Cincinnati and the Jets. By Sunday's evening game, New England might have already clinched the #3 seed. There's not much difference between a #3 seed and a #4 seed anyway. If Cincinnati loses, then the Jets will be the #5 seed and Cincinnati will play them at home next week.
Suppose that Cincinnati's coach thinks that the Jets would make an easy first-round opponent. It might be in Cincinnati's self-interest to lose to the Jets on purpose. If Cincinnati wins, they might have to play Baltimore or Denver or Pittsburgh, who might be stronger teams.
The NFL tiebreakers are an interesting combinatorial exercise. This site is interesting, because he runs a simulation of the rest of the season and enumerates the chances of a team making the playoffs. The NFL simulation isn't that interesting now because you could calculate it directly, but he also does simulations for hockey and basketball and baseball.
Mainstream media coverage of the "Sportsmanlike Dumping" problem is an example of people not thinking rationally. A coach should do what maximizes his team's chance of winning the Super Bowl, even if it means losing a specific game. Criticizing a coach for benching his starters is unfair, because it ignores the alternative possibility that they could be injured.
Tuesday, December 29, 2009
On "A Beautiful Mind Fnord", George Donnelly asked for specific examples of hidden messages on TV and in newspapers. One specific example is that I notice parasitic body language in politicians when they talk. I'll be more specific next time I see it. The only "news" shows I watch are "The Daily Show" and "The Colbert Report". I saw Bill Clinton and Jimmy Carter on "The Daily Show", and found their parasitic body language very offensive.
Another fnord is the Tiger Woods infidelity incident. The story completely disappeared recently. It was replaced by the person who tried to blow up a Detroit-bound airplane. That's another evil fnord, but not the point of this post.
Tiger Woods' infidelity is a hidden advertisement for "Monogamy is desirable!" Why doesn't Tiger Woods say "I'm Tiger Woods! Of course I'm going to have as many partners as I can!"?
I saw a picture of Tiger Woods' wife. She seemed to have the parasitic personality type, but it's hard to tell from just a picture. Tiger Woods' mistresses seemed to have the "abused productive" personality type. That's another offensive part of the scam. He switched from playing one role to the other role. With Tiger Woods and a supermodel, Tiger Woods can play the "abused productive" role. With Tiger Woods and some waitress, Tiger Woods can play the parasitic role.
Another fnord is "HAHAHA!!! Tiger Woods is famous and wealthy, but he screwed up!" Tiger Woods is not a real State insider. He earned his money via his golf skills and shilling for the State. He doesn't have the ability to directly loot and pillage and pass that ability on to his children.
If Tiger Woods went around saying "Taxation is theft! Government is a scam!", then all his endorsers would certainly drop him. Infidelity is a violation of State rules, but it's a forgivable transgression. He's hired some marketing/propaganda wizards to prepare his comeback.
Tiger Woods is taking a "vacation" from golf. That's irrelevant, because it's the off-season for golf now anyway. He'll probably declare his return a week or two before the Masters. The national attention is focused elsewhere now. He'll announce his comeback in a month or two with great fanfare.
Chris Rock had a good joke on this. "Shaq is rich but not *WEALTHY*. The guy who writes Shaq's paycheck is *WEALTHY*." Even though Tiger Woods made a lot of money, for every $1 he earned, State parasites earned several dollars. Unlike the banksters, Tiger Woods legitimately earned his money by being a good golfer/entertainer. If people will pay a couple dollars each to watch Tiger Woods play golf, then he legitimately can earn a huge salary.
Stories like that of Tiger Woods have a lot of interesting fnords. Whenever you see a story hyped beyond what seems reasonable, you should naturally ask "How does this story glorify the State?" The story of the guy who tried to blow up the Detroit-bound airplane has a lot of other evil fnords, but that's the subject of another post.
Monday, December 28, 2009
Anonymous has left a new comment on your post "Stefan Molyneux is a Murderer!":
Interestingly Dr Nash (he won the Economics Nobel prize) stopped taking his drugs totally.This is an important evil fnord. Many times a "historic" film has the facts altered, either to serve State propaganda needs or to make the story better.
Watch the movie below. The relevant part starts at around 21 minutes.
There was a movie about his life. (A Beautiful Mind). The producer of the movie decided not to tell the truth about Dr Nash stopping taking his medicines and decided instead to say Dr Nash moved to a more modern drug on the grounds that it is dangerous to suggest to people they can stop taking drugs for mental illnesses!
I'd read the story of Nash before, but I didn't emphasize it here.
I have had a lot of Math training just like Nash. If you're a good Mathematician, you learn to think for yourself. Maybe it takes someone with that level of thinking ability to realize "Maybe these drugs are hurting me!" It's very hard for someone to refuse to take drugs, against the advice of your doctor.
When I was first forced to take psychiatric drugs, I didn't get full disclosure ahead of time. I panicked, called 911 for help, and then I was in the mental ward. I was a prisoner and could not leave. "You must take these drugs for the rest of your life!" seemed obviously wrong. I decided to conduct an experiment and stop taking the drugs. Even though I relapsed a couple of times, when I was well, I did my research and concluded that those drugs really are harmful and damaging.
Plus, a manic attack feels good! The only negative aspect was the "My parents panic and call 911. Psychiatrists kidnap me and forcibly drug me." Now, I've mostly cracked my pro-State brainwashing. I feel greater alertness and awareness. I should be able to avoid being involuntarily hospitalized again. It would be nice if I could explain the truth to my parents, but they'd never understand. I keep my ideas to myself for my personal safety. Blogging and the Internet have been a good means of gathering information and finding people who think like me.
In that video, Nash didn't have the outrage I would have expressed. He said "The director edited the facts, because he didn't want to suggest psychiatric drugs are harmful." I would have said "That mother****ing director lied to promote psychiatric drugs!"
Of course, the director might have faced legal liability if he suggested psychiatric drugs are harmful. Some lawyer at the film production company probably suggested changing that detail and nobody objected. Changing that minor detail makes the film an advertisement for the psychiatry/death industry.
Nash received money for the film. However, he didn't have any say over the actual content.
There was another interesting bit "The delusions portrayed Nash talking to an imaginary person, rather than the way the delusions really are." In my experience, the "delusions" were really that I was starting to see things that are actually there! For example, on the subway, I notice that all the other passengers are insane. That's not a delusion. It's real! It was very traumatic when I first started noticing it.
The best way to accurately portray psychotic delusions is like in the documentary "They Live!" However, it isn't special magic glasses. All of a sudden, you start seeing things as they actually are! I really do have the power of those special magic glasses!
For example, I now notice secret hidden messages when I watch TV. It isn't a delusion. They're actually there! I also notice parasitic body language by politicians and the comedians on the Communism Channel. It was very disturbing when I first started seeing them. Now, my reaction is "Oh, that again. Who do they think they're fooling?" "You see secret hidden messages on TV!" is one of the "symptoms" of schizophrenia. "Mental illness" is the disease of being able to see reality as it actually is.
I saw an advertisement for an antidepressant drug. It was one big evil fnord promoting the "chemical imbalance" theory of mental illness, in addition to the specific drug being sold. There was the explicit advertisement for the specific drug. There was a hidden advertisement, which is that drugs are the appropriate way to treat depression.
Drug companies spend billions of dollars a year marketing and lobbying. This makes it very hard for anyone to publicly criticize the psychiatry/death industry. A mainstream media corporation won't risk the billions of dollars spent on advertising. If you suggest that psychiatric drugs are harmful and people should stop taking them, then you might face legal liability.
Technically, a State prosecutor could say "FSK is guilty of 'practicing medicine without a license' when he says that the 'chemical imbalance' theory of mental illness is a fraud and people should stop taking psychiatric drugs cold turkey." In the corrupt trial, the State prosecutor would probably not even have the burden of proving that psychiatric drugs really are beneficial.
The movie completely altered the facts. Here's what really happened. As a young man, Nash did some great Math work. Then, he developed his "mental illness". He took psychiatric drugs. For years he was unable to work or do anything. He stopped taking the drugs, and then he started being a productive Mathematician again.
The movie said "Nash was sick because he stopped taking the drugs. He started taking them and recovered." The reality is that Nash recovered because he stopped taking the harmful drugs. Changing that detail completely reverses the meaning of the film. The actual story is a sharp criticism of the psychiatry/death industry. The altered story is an advertisement for the psychiatry/death industry.
When the film was made, they couldn't tell the truth "Nash got better because he stopped taking psychiatric drugs." Instead, they made up a lie, "Nash was helped by switching to modern psychiatric drugs." In effect, this made the film an advertisement for the pharmaceutical industry.
The producers of the movie thought "It would be irresponsible for us to suggest that psychiatric drugs are harmful." In fact, they could have been exposed to legal liability for telling the truth. So, they lied. However, saying "Psychiatric drugs are beneficial!" is immoral, because it's a lie. Unfortunately, it's a lie they can't be legally punished for making. The producers of that movie are an accomplice to murder as much as Stefan Molyenux.
Suppose I attempt "promote agorism via standup comedy". Suppose I am successful enough to get invited as a guest on a mainstream media program. If that occurs, I will point out that the "chemical imbalance" theory of mental illness is a fraud. That places the mainstream media corporation in an awkward position. If they let me say that, then they're exposing themselves to a legal risk. Plus, they risk alienating pharmaceutical industry executives who spend millions of dollars on marketing/lobbying/bribing.
The mainstream media corporation executives have a greater loyalty to their own jobs and avoiding being sued, rather than telling the truth. This makes it very hard to tell the truth on a mainstream media program.
Fortunately, if I attempt "promote agorism via standup comedy", my goal is not to make millions of dollars. My goal is to make as much money as I would make as a slave software engineer. That should be attainable even if I'm restricted to self-publishing on the Internet and even if I'm never invited on a mainstream media program. If my live performances are sufficiently popular, then I should be invited on a mainstream media program eventually. I won't hold my breath waiting. My plans will assume that never occurs.
For now, I'm sticking with my wage slave software engineer job and blogging. I'm planning to expand to other things. I'm probably going to wait another year or two.
The move "A Beautiful Mind" is one big evil fnord promoting the psychiatry/death industry. It's an interesting example of catching the mainstream media red-handed altering the facts.
Sunday, December 27, 2009
Switzerland was the last country to abandon the gold standard in 1999.
Recently, there was a dispute between the IRS and UBS. Some of UBS' customers had Swiss banking accounts, allegedly to avoid taxes. The IRS sued UBS to get the names of these customers. According to Swiss law, UBS could not disclose the names. With much fanfare, an "agreement" was reached and UBS bent over for the IRS.
When the Swiss franc was gold-backed, a Swiss bank account was *VERY* lucrative. It was essentially a receipt for gold.
Now, inflation allows the value of Swiss bank accounts to be stolen via inflation, just like all other fiat money banks.
If the Swiss franc isn't gold-backed anymore, and the transactions must be reported to the IRS, then what's the value of a Swiss bank account? For a long time, Swiss banking laws were very attractive, both to people who desired economic privacy and criminals. Now, there's no point.
If you really want economic privacy, you have to resort to the old-fashioned technique. Take physical delivery of gold and silver, and store it in a safe location.
"Develop an agorist banking system" seems very desirable and potentially profitable.
Saturday, December 26, 2009
This story is interesting. It illustrates the problem with the State violence monopoly and the State monopoly for helping people in need.
Two off-duty ambulance (EMT) workers were eating in a restaurant. A pregnant woman collapsed. The off-duty EMT workers refused to help, and told people to call 911 instead. The woman and her baby died.
Obviously, the EMT workers should have helped her. (Most off-duty policemen probably would help if they saw a crime in progress. If they aren't in uniform, how would you know?)
The problem is that the State creates perverse incentives.
The workers were off-duty. Would they have been paid overtime for helping her? Would they have been rewarded? There was no explicit arrangement made ahead of time.
The EMT workers had an interesting excuse. They were dispatchers and not front-line workers. That's a pretty lame excuse. That illustrates the "management doesn't actually do real work" fallacy of most State parasites. For EMT dispatchers, they are required to also be qualified to work as EMTs.
Did the EMT workers do anything illegal? Technically, they were not working at the time. They didn't break any of the explicit written rules.
The EMT workers are unionized. Government bureaucrats probably can't fire them for misconduct. Their lawyers will probably successfully argue "They were off-duty and didn't do anything wrong."
The problem is that the government has a monopoly for helping people. Suppose you worked for a private for-profit ambulance service. Of course you'll help out in an emergency, because you and your employer will get paid for it. An free market police/defense/insurance agency would have an arrangement saying "You get paid if you help one of our customers in an emergency."
EMT/911 workers are employed directly by the State. It makes no difference if they do a great job or an incompetent job. They have a monopoly.
Suppose you do call 911, but an ambulance arrives too slowly and you die. That's too bad for you. State agents have no positive obligation to help you.
Suppose EMT workers do help you, but they do an incompetent job and you die or are you seriously injured. That's too bad for you.
If you aren't a State-licensed EMT worker and you help in an emergency, you might face liability. You might be accused of a crime. You might face a civil lawsuit. Also, it's illegal to start a competing for-profit emergency help service that competes with the State monopoly.
This story illustrates the evil of the State violence/911 monopoly. State agents are bureaucrats doing the minimum possible job, rather than doing the best they can. In a really free market, there would be a real incentive to help someone out during an emergency. Free market competition would guarantee high quality and low prices.
The problem is not those specific lazy EMT dispatchers. The real problem is the State monopoly for responding to emergencies. As usual, the lazy EMT workers are blamed and not the underlying problem. "Fire those lazy EMT workers!" is the proposed solution, but that would just replace one State bureaucrat with another State bureaucrat.
Friday, December 25, 2009
I'm not writing a post today, but I guess this counts. Some people complain when I skip a day.
I've been playing "Arcuz", an online flash game. It's a Diablo-like RPG. It's a bit hard at times, but still interesting.
I'm way behind on reader mail. I also am starting to run out of my queued drafts. I might switch to less than 7 posts per week.
Thursday, December 24, 2009
In this thread on mises.org, someone was asking about interest rates. When people decide to invest or consume, how does that affect interest rates?
Suppose there was a really free market.
If people decide to save money, then interest rates drop. There is surplus labor/capital for others to invest.
If people decide to borrow and build businesses, then interest rates rise. There is less labor/capital for others to invest.
The central bank credit monopoly distorts this process. The central bank price-fixing cartel sets interest rates, and not the free market.
By keeping interest rates below the natural free market rate, this sends a false price signal that it's profitable to borrow and invest. This leads to boom/bust cycles.
In a really free market, interest rates are a price signal about "What investments are worth pursuing?" The central bank credit monopoly prevents people from communicating, via interest rates (prices), which investments are most desirable.
Wednesday, December 23, 2009
I came up with some strategies for cleverly hiding my gold/silver/platinum, for when I make an investment in physical metal. I then read an article on "The first place a criminal looks when he robs you." Surprisingly, he mentioned all the things I had considered, and then some more! Here's the places to *NOT* store your gold.
Don't use your refrigerator. That's the first place criminals look. Some people keep drugs here, making this a high-value target.
Don't use your medicine cabinet.
Don't put it in the tank of your toilet.
Don't put it under your bed/mattress.
That's pretty impressive. The best strategy I can think of is "Find someone who owns a metalworks business (or start one myself) and make some figurines or other metal objects. A criminal might not recognize them as valuable." This applies to both common criminals and criminals wearing shiny badges and uniforms. For example, if I have a chess set and the pieces are solid platinum, then someone might not realize they're valuable!
Another strategy is a couple of cleverly hidden caches. If you put a couple of ounces of gold in an easily-discoverable location, then a criminal might assume that's all you have and not look for the rest of your stash. That might work against a common criminal, but not against State police doing a full search of your apartment at their leisure.
"Where is a safe place to store your metal?" is my biggest concern with investing in physical gold and silver.
Tuesday, December 22, 2009
I see this issue debated over and over again in many contexts. A State policeman/thug stops you and demands ID. The policeman doesn't have the legal authority to demand your ID. Do you:
- Show ID to avoid the hassle and waste of time.
- Refuse to show ID.
I'd probably show ID to avoid the hassle and waste of time. I'd comply with the policeman's demand. I'd use the time saved for promoting agorism or other productive activities.
The policemen's salaries are paid via taxation/theft. The policeman can detain you. They get paid the same either way, but your time is wasted. You might say "That's wasting police resources!", but almost everything that monopolistic State police do is a waste!
The policeman would probably conclude "FSK is not dangerous!" solely based on my body language, and not escalate the issue. For example, when I get on the subway carrying a bag, the police are sometimes checking all bags. If I walk up to them and open my bag to show it to them, they don't even bother looking inside. Even if there were no other passengers, the policemen would be more interested in their conversation with each other than carefully checking my bag. If I acted nervous and walked passed them, then I'd certainly be subjected to a full search.
It's amusing to see a policeman with a bomb-sniffing dog. The dog is usually a lot smarter than the policeman! The policeman doesn't notice me. The dog seems to notice "This human is more alert than the others!" The dog doesn't give the "FSK is carrying a bomb!" signal, so the policeman doesn't notice.
If you refuse to show ID, then the policeman will make up an excuse and arrest you. Then, it's your word against the policeman regarding the facts of what happened. Fake crimes like "disorderly conduct", "disobeying the orders of a policemen", and "resisting arrest" allow the policeman broad discretion to do whatever he wants.
There usually are multiple policeman present. They will all say "The guy who refused to show ID was a threat and needed to be arrested!" If it's one non-policemen disagreeing with several policemen, the policemen will almost always be believed in a State court. When testifying, the policemen carefully rehearse and coordinate their stories.
Some people say "If the policeman attempts to arrest/kidnap me, then I'll resist violently!" or "I'd run away!" Such an approach will likely end in your murder. The policeman can always say "But he was reaching for a gun!" and then murder you and get away with it. Even if you could somehow kill all the thugs currently confronting you, you'll be murdered when backup arrives. At some point, the thugs will learn about the death of their comrades, and will come after you with superior resources. If it's one person against the full focused power of the State, then that person is SOL; nothing focuses the attention of the State like the death of a thug/policeman. The death of a policeman is always a #1 priority, because members of a criminal gang protect each other.
A direct violent confrontation with policemen is pointless. You'll just get yourself arrested or tasered or killed.
I'd rather use my time productively promoting agorism, than wasting it in a confrontation with idiots.
Some people say "I'll sue the police for misconduct!" My reaction to that is "Forget it, idiot!" Think about it carefully. Who do the police work for? Who does the judge work for? A judge knows that the only reason he has power and influence is the fact that State thugs obey his orders without questioning them. Therefore, a State judge almost always sides with the police in a dispute.
You sometimes hear cases where an individual has a dispute with a policeman in a State court and wins. Those cases are themselves evil fnords. The fact that sometimes a policeman does something bad and gets caught, doesn't justify all the remaining times where they get away with it. Even when a policeman murders someone, the worst-case outcome usually is that the policeman gets fired. A State judge almost always accepts the policeman's explanation over the non-policeman's explanation.
As I mentioned before, suing the government is pointless. Even if you could sue the State in a State court and win, the damages would merely be paid by everyone else as higher taxes. The State bureaucrats themselves are protected by sovereign immunity. They will suffer no personal liability for their misconduct.
Consider an analogous situation. You see a crazy person on the subway. Do you:
- Pick a fight with him.
- Ignore him.
A State thug or bureaucrat should be treated like a crazy person on the subway. Once they notice you, your best approach is to escape their attention. With a crazy person on the subway, they'll forget about you. With State bureaucrats, they will dispatch as many armed thugs as needed to ensure your compliance.
A State bureaucrat is much more dangerous than a single crazy person on the subway, because he's a member of a crazy cult with lots of resources. The overall principle is the same.
Suing the State for damages in a State court is like picking a fight with a crazy guy on the subway. It's a waste of time.
The best strategy for ignoring insane State bureaucrats/thugs is agorism.
Who owns the money in your checking account? If you think "I own the money in my checking account!", you're delusional.
If the IRS determines that you owe them money, they can steal from your checking account without warning you first. Sometimes, a debt collector can steal money from your checking account without warning you first. If you're the victim of identity theft, you may not find out until the creditor steals money from your bank account. You bank works for the State first, and you second.
Also, the bank is required to report "suspicious transactions" to State enforcers. If you withdraw or deposit a lot of cash, bank management is required to fill out a "Suspicious Activity Report". They are legally barred from notifying the customer that they filed such a report.
Via inflation, the value of your checking account is stolen. If there is 2% monthly inflation, it's like the police demand 2% of your savings every month. The police don't need to go door-to-door to collect this tax. It occurs via inflation.
Suppose I perform work and deposit $1000 in my checking account. Are there any tangible goods backing my deposit? No, there aren't. The rest of society (the parasite class) gets an extra $1000 of wealth because I worked in exchange for a piece of paper. When I withdraw that money and spend it, then the rest of society experiences inflation.
With fiat money, "savings" merely represent wealth that the parasite class may steal. If I save fiat money, effectively I worked for free.
My checking account balance is a bookkeeping entry. If everyone went to their checking account, withdrew all their money and spent it, then there would be rapid inflation. The scam requires the confidence of the victims in order to continue.
That's why "consumer confidence" is important. For a wealth-based economy, confidence is irrelevant. For a scam-based economy, confidence is supremely important.
It doesn't matter if you go around saying "FSK's blog sucks!" As long as I have enough readers to earn advertising revenue, it doesn't matter if everyone else hates my blog. Right now, I'm doing this as a hobby and not as a job.
If you go around saying "Federal Reserve Notes are worthless!", and people start believing you, then the parasites have a problem. "Consumer confidence matters!" is a symptom of "It's all one big scam!" A con artist needs the confidence of his victims.
Suppose I work for an ounce of gold, and keep it in a warehouse receipt bank. In that case, if the bank is honest, then there are tangible goods backing my deposit. Gold has actual physical value. Gold does an excellent job of preserving its purchasing power over time. A State paper investment will eventually lose all its value due to inflation, while physical gold is safe from theft via inflation. Many corporations have gone bankrupt, and others have severely underperformed true inflation. Gold preserves its value over time.
With a gold standard and fractional reserve banking, your deposit is only partially backed. If all depositors simultaneously withdraw their gold, there is insufficient metal to pay everyone. With fractional reserve banking, the banksters are fraudulently expanding the money supply.
In a time-deposit bank, depositors have time deposits and not demand deposits. This isn't fraudulent like fractional reserve banking, which artificially increases the supply of demand money.
The only honest forms of banking are a warehouse receipt bank, a time-deposit bank, or by holding physical gold/silver in your possession. In the present, silver/gold warehouse receipt banking and silver/gold time-deposit banking are forbidden by State enforcers. The best option to protect your savings is to buy physical gold/silver and take delivery.
"Start an agorist banking system!" seems like a high priority. If you keep all your gold in one place, you're at risk from theft via State enforcers. Gold and silver protect your savings from theft via inflation. A distributed and decentralized banking system protects people's savings from theft via a State raid.
Monday, December 21, 2009
There's a very interesting subtle evil fnord that's repeated over and over again. This is very closely related to "False Opposites".
What is the opposite of "Taxes should be higher!"? The naive answer is "Taxes should be lower!"? How about "There should be no taxes at all!"?
What is the opposite of "The Federal Reserve should lower interest rates!"? Is it "The Federal Reserve should raise interest rates!"? How about "The central bank credit monopoly is immoral!"?
What is the opposite of "The government should spend more money on public schools!"? Is it "The government should spend less money on public schools!"? How about "There should be no State schools!"?
This is a very common evil fnord. The mainstream media debates making the State bigger or smaller, tightening the screws or loosening them. They never say "Is this issue any of the government's business?"
By presenting "X should be bigger!" as the opposite of "X should be smaller!", that hides the possibility of discussing "X should not exist!"
Sunday, December 20, 2009
In this thread on mises.org, someone was asking what interest rates mean.
Suppose you're 30 years old. You do work now, but want to save some of the profits for your retirement.
You produced more than you consumed. Now, you have money.
The rest of society benefits, because you performed work in exchange for money.
If you lend that money to other people, they can invest your surplus labor profitably.
Interest is the reward for someone producing more than they consume, so they can have savings for later.
Suppose interest rates were determined by the free market and not a central bank credit monopoly. Other people are bidding on the right to invest my surplus labor. Whoever offers the highest interest rate, and is creditworthy, gets the right to invest my surplus labor when I lend them my money. This guarantees that surplus labor is invested efficiently.
When central banks distort the interest rate market, they distort people's ability to make economic decisions and plan for the future.
If I put Federal Reserve Notes in my checking account, I get 1% interest but true inflation is 10%-30%+. By saving money, I'm letting the banksters rip me off via inflation.
A CEO of a large corporation wants to borrow to build a new factory. He may borrow at 6% while true inflation is 10%-30%. This sends a false price signal that building the factory was desirable. A factory is built, instead of something else that would be more useful.
The central bank credit monopoly steals, via inflation, my reward for producing more than I consume. There's reduced incentive to save, because my savings are stolen via inflation. There's incentive for people to rack up as much debt as they can, because interest rates are less than true inflation.
The central bank credit monopoly has damaging effects. It affects everyone's ability to make rational economic decisions and plan for the future. The beneficiaries of this theft are insiders, who may borrow at cheaper interest rates compared to everyone else.
Saturday, December 19, 2009
I've been looking through Bing's search results, and am disappointed.
If you Bing search "The Compound Interest Paradox", my blog post on the subject isn't listed. (Ironically, the knol I wrote was listed. I briefly experimented with knol and then I gave up on knol as a waste of time. )
Bing doesn't rank my blog for "monetizing the debt", but I'm near the top of Google.
Bing doesn't list me for "The Supreme Leader of Humanity". In Google, I'm #1 for that search phrase. As far as I can tell, my blog is the only site that regularly uses that phrase.
Looking at Bing, I don't see anything that stands out for "This is better than Google!" There are a quite a few deficiencies. The ability to search for a specific date range is a missing feature.
When I'm looking for help on Excel or Visual Studio, I get better answers via Google than with Microsoft's own online help/search system!
Friday, December 18, 2009
Via Google, I keep track of what my ex-employers are doing. At the Rails Advocate job, their website hasn't been updated in more than a year. The owner is probably keeping the website live while trying to raise more money. It was a good business plan. The problem was poor execution. They trusted the software side of their business to incompetent parasites. As usual, people with the "abused productive" personality type get scammed by parasites.
Ironically, in that job, the "marketing wizards" had the "abused productive" personality type and the software engineers were the parasites! That's the reverse of the usual formula. Normally, the "marketing wizard" is a parasite, and the software engineer is "abused productive". That way, you get a website that actually runs.
I was unfairly fired from my wage slave job at a startup this summer. This was the one where a parasitic co-founder used to be a program manager at Microsoft.
They fired 1/3 of their employees at the end of November. That was surprising. They just raised a couple million dollars more VC a few months ago. I was fired at the beginning of October.
In mid-October, they terminated the "employer paid lunches" perk. That's a red flag. Employer paid lunches are a nice perk that actually has negative cost to the employer. You save the time people waste getting their lunch, which is worth more than the lunch.
According to the articles I read, they handled the layoff in a really classy fashion. They E-Mailed employees over Thanksgiving break and told them to not come into work on Monday. That shows their lousy ethics. They didn't even fire people to their face.
They are on the failure path, but they're still in business. At this point, the VCs would be better off shutting down the company and paying out the remaining money as a dividend, but that's not the way they think and is probably a legally questionable move. The founders will probably keep the website active, in a desperate attempt to try to raise more VC and keep it going. According to Alexa, their site traffic has been flat over the past few months. Their rosy predictions of "We'll make $40 eCPM selling ads! We'll get lots of traffic!" probably stopped fooling their VCs.
The founders will probably find another VC dumb enough to fund their next stupid business idea. One founder will milk his "I used to be a program manager at Microsoft!" angle and the other founder will milk "I once was part of a successful startup!" The VCs will judge them on their history, and not their current ability. That's the fallacy of judging someone by their resume, rather than their actual current ability. The VC is himself a parasitic fool, so they will get more funding for their next business.
My current wage slave employer has an explicit State-backed monopoly. They won't go broke until the financial system completely collapses.
My direct coworkers are happy with my output so far. I set up a simple webserver in PHP/Apache/UNIX and wrote some test scripts that show how it works. I'd never done a PHP/Apache/UNIX install before. It was easier than I thought it would be. I didn't have the root password, but I installed it in a user directory and fortunately port 8080 wasn't blocked. My direct boss has enough computer literacy to understand and make small changes to my scripts.
They want me to convert financial reports they currently make by hand into auto-generated web-based output. As an added bonus, since it's hypertext, I'm putting in features that let them click on things to show the details of a calculation.
Of course, it's all a joke, but at least my jokes are implemented via nice-looking software. I'll do my part in providing them with the illusion that it isn't one big scam. Surprisingly, my coworkers also know it's a scam. One said "The USA reminds me of the Soviet Union before it collapsed." It's pretty funny. The risk managers at this large financial institution are partially in charge of making sure it doesn't all collapse. They're all making plans to leave the country!
Surprisingly, none of my current coworkers are thinking "FSK is too competent! I must get rid of him!" They're too far down on the management food chain to have high parasite skills.
I realized that someone like Bernard Madoff would *NOT* work for my current employer. The high level of bureaucracy and audits would make it practically impossible for him to steal.
The long-term plan is still to start my own agorist businesses. I still need a wage slave job in the meantime. This is good enough for now.
Thursday, December 17, 2009
This article was interesting.
In New Hampshire, it's legal to carry an unconcealed gun if you have a permit. Someone decided to openly carry a gun near a speech by Obama in New Hampshire. During the speech, Obama was advocating for health care reform.
That article was saying that the person carrying the gun was implicitly saying "I'm going to use violence to defend myself against this lousy healthcare plan!"
He was carrying a poster that said "It's necessary to water the tree of liberty with the blood of tyrants." That's in implied threat of violence against State enforcers.
There's nothing wrong with carrying a gun. However, the mainstream media is now using the incident to portray all freedom-seekers as fruitcakes.
It's acceptable for policemen to carry a gun, but it's not acceptable for non-policeman to carry a gun. This inconsistent thinking is very common. Why is the policeman magically blessed with goodness, but all non-policemen who carry a gun are automatically criminals?
There is another important point. Even if one person does something foolish, that doesn't mean that all people who seek freedom are fruitcakes.
One of the main purposes of gun ownership is to defend yourself against aggression by the State. The lousy healthcare "reform" plan is an example of State aggression.
It seems silly to say that, just by carrying a gun to a political speech, someone is advocating for violence against State agents.
There appear to be two separate arguments:
- Violence against State employees is a bad tactical decision. Their resources are far too superior. If you suggest the possibility of violence, then the State will violently crack down on you. Even if you could kill a State employee without any personal risk, someone else would merely take their place.
- Violence against State employees is a violation of the non-Aggression principle. Most State employees are not aware that they're participants in a massive crime. If I work in a wage slave software engineer job, I'm supporting the bad guys as much as a policeman. The wealth stolen from productive workers via taxes makes State violence possible. In the present, nearly everyone directly or indirectly supports the State. If you perform on-the-books work, you're supporting the bad guys via taxes. If you use slave points as money, you're supporting the bad guys via the inflation tax.
I don't have a valid claim against *ALL* psychiatrists. I do have a malpractice claim against the specific psychiatrists that mistreated me. A corrupt State court doesn't recognize my claim as valid. Do I have any alternatives? My only options are to let it go, or adopt the unabomber approach. I've decided to let that claim go and focus on not being hurt in the future.
Do you have a valid claim against State employees that aggress against you? Suppose the IRS pursues you for criminal tax evasion. Do you have a valid claim against the State employees that harassed you? As a practical matter, that claim is unenforceable, since the State doesn't recognize that claim as valid and there's no competition to the State justice system.
The problem is that there's no middle ground. There's no way to get and enforce a claim short of murdering the aggressor. Once the agorist counter-economy is more sophisticated, blacklisting someone from the free market would be a severe disincentive against State agents harassing agorists.
That's why current black market participants, such as drug dealers, always resolve their disputes violently. If two black market drug dealers get involved in a dispute, their only alternatives are to let the claim go and avoid the other person, or to murder them. If a drug dealer claims that another drug dealer owes him $10k, there's no way to pursue that claim in a State court. The only alternatives are to forget about the $10k, or murder the person who owes you the money.
Similarly, if you have a dispute with a State agent, the State agent is protected by sovereign immunity. Your only options are to forget about it, or to retaliate violently. If you adopt the violent approach, then the full power of the State will be focused on catching you. That's contrary to the goals of an agorist, which should be success via stealth.
That's the reason there's a big outcry whenever a policeman is shot or murdered. The State *MUST* protect its agents. Assaulting or murdering a policeman is a more serious crime than hurting a non-policeman. The police are protected by sovereign immunity.
As the State collapses and the counter-economy gets more sophisticated, claims against State agents will start to be enforceable. The State agent would be banned from participating in the free market if he harasses an agorist. It's possible that the counter-economy could get so valuable that this threat would be enough to force State agents to behave, even if the counter-economy possesses no weapons.
The problem with violence against a State employee is that it only works if you're prepared to defend yourself against the full focused power of the State. By the time that's practical, the State has already lost anyway. Until then, the State can afford to send 10,000 or 100,000 armed thugs against your small group of freedom seekers. The bad guys can afford to send 100,000 armed thugs to catch 100-1000 freedom seekers, because they know that once a group acquires freedom then their whole scam starts to unravel.
You can't defeat the State with violence. The bad guys specialize in violence! It's silly to argue "Is violence against State agents who abuse their power morally justified?" As a practical matter, that's a waste of effort. By the time such a tactic would be effective, the bad guys will have already lost anyway.
Wednesday, December 16, 2009
In my new wage slave job, most of my coworkers are Chinese. The boss of the group is Chinese, which leads to him hiring people of the same ethnic group. I noticed that happens a lot. If the boss has ethnicity X, then his subordinates have ethnicity X.
They had a Christmas party. My boss' boss was speaking a lot. He made a lot of anti-Chinese racist comments, regarding the group I work in. I was surprised that nobody else noticed. Maybe they noticed but were afraid to say anything. I didn't say anything to anyone, but I thought about it. It definitely was in the "Dude! That's totally embarrassing! Don't do that!" category.
"Chinese" is not a legally protected minority group. If he had made anti-Hispanic or anti-African American comments, he definitely would have been risking a lawsuit. Nobody noticed, so I doubt there's a risk.
I had a weird experience in the elevator. Someone who was a really strong parasite got into the elevator. I had a momentary feeling of extreme fear. I hadn't noticed that reaction before.
I don't work with him. He probably didn't notice me. It was a very weird experience.
I certainly have noticed a negative correlation "Higher-ranking management implies less competence." It's more noticeable in a larger corporation.
Tuesday, December 15, 2009
This story contains an important evil fnord.
President Barack Obama implored top bankers Monday to help keep the fragile recovery from faltering by boosting lending to small businesses and getting behind an overhaul of financial regulation. "We rise and fall together," Obama declared.Trillions of dollars were spent in Federal bailout money. There was TARP bailout money explicitly allocated by the Federal government. There was secret bailout money provided by the Federal Reserve. The Fed Funds Rate is currently 0%-0.25% while true inflation is 20%-30% or more, which is a further subsidy for the banksters. Negative real interest rates are a continual subsidy for the banksters, even if no bailout money is explicitly allocated.
A year ago, oil prices were really cheap while interest rates were really low. Some hedge funds borrowed money, bought oil, paid to store it, waited for inflation, and then sold. This was very profitable. They made a huge profit, without doing any real work.
When real interest rates are negative, this is a very lucrative profit equation:
- Borrow money cheaply and buy tangible assets.
- Wait for inflation.
- Sell and profit!
These profits aren't free. They're paid by the rest of society as inflation.
There's a lot of hype about "Banks are repaying TARP money. Hooray! They aren't scum!" The problem is that these profits are fueled by a Fed Funds Rate of 0%-0.25%. A more accurate statement is "Banks received cleverly hidden State bailout money and used that to repay direct explicit bailout money!"
State parasites "stimulated the economy" by giving trillions of dollars to politically connected insiders. They could have given $10k directly to each American, and that would have had the same net stimulative effect. This was never seriously discussed as a possibility. There were token stimulus payments of a couple hundred dollars, but this was negligible compared to what the banksters stole.
The point of the monetary system is debt enslavement of every American. Even if you personally have no debt, your savings are stolen by inflation. If you have no savings, then you're stuck during the next recession/depression. If you have as much debt as you can, then you'll be bankrupted during the next recession/depression. Even if you have no debt, large corporations have lots of debt, and most people work for large corporations directly or indirectly.
Negative real interest rates concentrate economic power in the hands of people who print and spend new money. The banksters can borrow at 0%-0.25%. They use this money to speculate on the stock market, buy other tangible assets, or lend at higher rates.
A corporate CEO can borrow at 6% or more. A pro-State troll says "The CEO is creditworthy but a small business owner is not." The reality is that the CEO was appointed via a corrupt nepotism capitalism process. Most CEOs don't have skills that would be useful in a true free market. They merely excel at exploiting a corrupt system and navigating through a parasite-dominated State bureaucracy.
A CEO borrows at 6% while true inflation is 20%-30% or more. That means that the CEO can normally profit and repay the loan, even if he invests the money unwisely. For example, an investment that yields 15% is profitable enough to repay the loan, yet returns less than true inflation. This leads to misallocation of capital and asset bubbles.
A small business owner must pay higher interest rates or can't borrow at all. A pro-State troll says "The small business owner is uncreditworthy." The reality is that the State has a monopoly for financing businesses. The small business owner can't borrow money from friends and relatives, because he has to pay an extortionate rate or the lender gets ripped off by inflation. If the small business owner sells equity, then either the minority equity owner risks getting cheated, or the owner becomes an employee in his own business.
The pro-State troll statement "The small business owner is uncreditworthy!" really means "The small business owner can't profitably lobby the State for favors like the CEO of a large corporation!"
The State monetary monopoly gives political insiders access to capital, while denying individuals access to capital. "It's the free market!" is an evil fnord, because there is no free market monetary system. A central bank credit monopoly is the opposite of a free market. You can't say "The free market has favored the CEO over the small business owner." The correct answer is "State violence favors the CEO over the small business owner."
This is an important evil fnord. "The banksters are doing the work of God, 'stimulating' the economy." The reality is that they are parasites, lining their pockets at the expense of everyone else. The banksters create the illusion that they are heroic leaders and brilliant businessmen.
Monday, December 14, 2009
In this thread on mises.org, someone asked about banknotes and free market banking.
In a free market, banks wouldn't be able to issue fractional reserve banknotes. Nobody would accept them.
As soon as someone suspected or discovered that a bank was practicing fractional reserve banking, all the customers would rush to redeem their deposits. There would be no State to protect the bank owners from the negative consequences of their fraud.
If an honest warehouse receipt bank is subject to a run, there's no problem. It pays off all customers and then continues operating and accepting deposits again. Having proven its honesty, there's no reason for customers to switch to competitors.
Banks could issue warehouse receipt banknotes. A rational person would immediately redeem them for physical metal or a warehouse receipt in his own bank.
For warehouse receipt banking, a fee would be charged. It'd probably be low, 0.1% per year or less. There might also be a transaction fee. In the present, a COMEX warehouse receipt has a storage fee of approximately 0.1%-0.2% of the value of the metal.
A warehouse receipt bank would need to have public audits, so that customers know they aren't secretly practicing fractional reserve banking. In the present, ETFs like GLD and SLV are "audited", but I have no guarantees that the auditors are honest or competent. The auditors of an investment fund or corporation are chosen by the management, leading to the obvious conflict of interest.
For time-deposit banking (like a certificate of deposit), then there would be interest. Suppose you had a 1 year time deposit redeemable for 100 ounces of gold and interest rates are 4%. After 6 months, you could sell this for 98 ounces of gold. If there's a risk of insolvency by the bank, then its CDs will trade for less than face amount.
Such a system existed before the Federal Reserve credit monopoly was created. It was called "Bills of Exchange". The Federal Reserve credit monopoly destroyed this decentralized banking system that allowed individuals to directly lend each other money.
A "Bill of Exchange" does not exist in the present, because it's silly for individuals to lend each other Federal Reserve Notes. Either the lender has to charge an extortionate rate compared to a State bank, or the lender gets ripped off by inflation. Banks can always issue loans more cheaply than individuals can lend to each other, because banks may borrow at the Fed Funds Rate and exploit the central bank price-fixing cartel.
Banking is not inherently evil. This is a common misconception. It is banking *COMBINED* with State violence that is evil.
Management of a free market bank is not protected by limited liability incorporation. They must do a good job, because they risk losing their savings and careers if there's a fraud.
In a really free market, banking is not evil. Free market banks provide a useful service, matching savers and people who need capital. The current system is completely corrupt, but that doesn't mean that banking, profit-seeking, and investing are inherently evil.
The problem is that government violence, combined with greedy parasites, leads to evil. In a really free market, you can't profit unless you also provide a useful good or service.
Sunday, December 13, 2009
"Taxation is theft!" is an excellent summary of the evils of the State. There's an important extension of that idea. If you pay taxes, you're actively contributing to the evil of the State.
The parasites' scam continues because the vast majority pays taxes/tribute without questioning it. If you pay taxes, you're partially responsible for all the evils of the State. If you pay taxes, you're paying for aggression against your fellow human beings.
Taxes are used for war, corporate welfare, enforcing stupid laws, and aggressing against other humans. If you pay taxes, you're contributing to these evils.
Not only is there a selfish reason for avoiding taxes, there's also a moral reason. You should avoid paying taxes, because you should protect your property. You should avoid paying taxes, because taxes actively support evil.
Now, someone will object:
There's a criminal gang that will shoot me if I refuse to pay. Is it immoral for me to pay them their tribute?The victim of a crime is not as responsible as the thief. If you don't take precautions to protect your property, then you're partially responsible if someone steals it and uses it for evil.
If you give a loaded gun to a child and he hurts someone, are you responsible? Similarly, are you responsible when you give your property to insane State bureaucrats? Taxes give wealth and power to mentally incompetent parasites.
Agorism is a viable strategy for resisting evil and protecting your property. If you don't attempt agorism, then you're actively contributing to evil.
Once you understand "Government is a criminal terrorist organization!", then it becomes a question of tactics. "What is the most effective strategy for protecting my property from theft?" is a different attitude than "I'm helpless in the face of this criminal!"
Suppose that every day, on the way home from work, you were mugged and the robbers stole half your money. You complain to the police and they say "Sorry, we're too busy!", because they're taking bribes from the criminals. You complain to other people, and they say "The mugger who robs me every day takes 55% of my money! Be happy that your mugger only takes half your money!" You would confront the mugger directly yourself, but the mugger has other associates who will assault you if you defend yourself. You would walk home another way, but there's a mugger on every corner; the first mugger gives you a receipt so that the others don't rob you also.
Fighting this criminal gang on your own is hopeless. You're outnumbered, and the criminals have superior resources. Rather than accepting your status as a permanent victim, you might decide to find a group of people who work together to protect themselves from organized crime.
If everybody resisted at the same time, then the scam would collapse. The vast majority pay without resisting, making the scam profitable. Because the vast majority pay without resisting, the criminals can afford to spend a lot of resources pursuing those who refuse to pay their tribute.
Agorism is a strategy where you can protect your property from theft, even if the vast majority are still paying their tribute to the criminals.
Right now, I don't have any options for protecting my property from theft. Hopefully, in a few years, I'll have more opportunities for freedom. I have a wage slave job where all my income is reported to the State/IRS, and taxes are automatically deducted from my paycheck. As long as I work in the slave economy, I must pay tribute to my masters.
I'm sympathetic with people who pay their tribute for now, while seeking freedom. That's what I'm doing! However, if you accept your status as victim, then no escape is possible. A mental shift towards freedom is a prerequisite for a physical shift toward freedom. "The criminals are too powerful! I'm not resisting!" is a self-defeating attitude.
There's a herding effect. If you're seeking freedom by yourself, you're very likely to get caught. If a large group of people are seeking freedom, then the odds of each one getting caught is small. If there's enough agorists, then tax resister insurance becomes a viable business, further decreasing the risk.
In California, there are so many people growing marijuana that the State police only arrest/kidnap/assault the biggest farmers. A large number of people breaking a law makes enforcement of that law difficult/impractical/impossible.
If everybody stopped paying taxes at the same time, then the scam would immediately end. The State thugs and bureaucrats would walk off their jobs when their paycheck bounces. Agorism is a strategy where people can stop supporting evil one at a time.
Seeking freedom is risky. Letting criminals steal most of your life and property is also risky. As the rate of looting and pillaging increases, the uncertain risk of agorism becomes more attractive than the certain risk of theft by the State. If you're careful, the risk faced by an agorist is low.
This is an important extension of "Taxation is theft!" You have a moral obligation to not pay taxes. The profits of taxation are used to hurt other people. If you pay taxes, you're facilitating organized crime. If you pay taxes without resisting, you're making it easier for the parasites to crack down on people who seek freedom. If you pay taxes, you're contributing towards my enslavement.
Saturday, December 12, 2009
In this thread on mises.org, someone was asking about free markets and corporations. Can large corporations exist in a really free market?
The argument against corporations is that they receive massive direct and indirect State subsidies.
If I want to borrow $1M to start a business, I can't borrow at all or I'll pay extortionate interest rates.
If the CEO of a large corporation wants to borrow $1B, he can borrow on very favorable terms. This distorts the market in favor of large corporations.
A pro-State troll says "That's because FSK is uncreditworthy!", but it's more than that. Executives at a large corporation have a State-backed monopoly/oligopoly. That's collateral for the loan. As an individual, the loan is only backed by my own future labor.
Real interest rates are negative. The CEO of a large corporation receives a huge subsidy when he borrows $1B at a real interest rate of -10% or less. The central bank credit monopoly and paper money concentrate economic power in the hands of people who print and spend new money. I can't avoid subsidizing the CEO of a large corporation unless I also boycott the State's paper money.
Regulations also subsidize large corporations. The cost of regulation compliance is usually fixed rather than per-unit. Suppose it costs $1M to comply with a regulation. If I sell 1000 units, my regulation cost is $1000 each. If I sell 10M units, my regulation cost is $0.10 each. "Economies of scale" are an illusion. The "economy of scale" myth derives from "Larger businesses can more easily lobby the State for favors!" Large corporations squeeze out smaller competitors, because there's a terrorist organization that harasses all small business owners.
It'd be very hard to have a business larger than 100-200 without State restriction of the market. That's the natural maximum size of a human social group.
Suppose that someone is a brilliant manager and can oversee a 100 person factory. Why should he work for a large corporation? Instead, he should raise capital and start his own factory.
In a free market, anyone who's a really good worker would be able to start his own competing business, rather than work for a large corporation or work as an employee. Without a central bank credit monopoly, a skilled worker could raise money borrowing from friends. In the present, it's be foolish for a non-bank to lend me money. Either they would charge me an extortionate interest rate, or receive a return far less than true inflation.
In order to have large corporations, you need State restriction of the capital market, making it hard for individuals to start new businesses. You need State regulations, which impose extra costs on small business owners.
As another example, suppose a small business owner has $100k in revenue. He probably has to spend $5k on accountants, just to make sure he's in compliance with the tax laws. That's effectively a tax of 5%. A large corporation with $10B in revenue might spend $10M on accountants. That's a tax of only 0.1%.
Large corporations can most effectively lobby the State for favors. That's completely unrelated to any efficiency gains. If you own a $100k business, you can't afford to bribe a Congressman. If you control a $10B corporation, then a $10M lobbying budget is a negligible expense.
A large corporation is not genuinely efficient. A large corporation is most efficient at overcoming the overhead costs imposed by the State. A large corporation is most effective at lobbying the State for favors.
In a really free market, would a business be able to impose a "limited liability" clause on its customers? Suppose you sat down in a restaurant, and the waiter made you sign a limited liability agreement, waiving damages if you get food poisoning. Would you really sign it?
Suppose a bank required a "limited liability" clause in its deposit contract. Would you really deposit your savings there? If you got a higher interest rate than other banks, it would only be because you're risking the loss of your savings due to the "limited liability" clause.
Also, a fair free market court would probably not enforce a "limited liability" clause that is obviously misleading. A customer sitting in a restaurant doesn't expect to get food poisoning. Therefore, the restaurant has no right to demand the customer waive that liability.
As another example, suppose a business is incorporated. It pollutes and leaks oil into groundwater at a cost of $100M to cleanup. The business has only $1M in assets. The owners declare bankruptcy when the pollution is discovered. Even though the victims had no contractual relationship with the polluter, limited liability incorporation protected the polluter from his misconduct.
In the present, State incorporation allows business owners to force limited liability clauses on all customers. Limited liability incorporation protects management of a corporation from liability even by people who have no relationship with that corporation. When you limited liability incorporate, you're contracting with the State and not your customers.
"Corporations naturally exist in a really free market" is a mistake that pro-State (L)libertarians often make. Corporations are an artificial creation of the State. Large corporations only exist because of direct and indirect State subsidies. In a really free market, no customer would agree to a limited liability clause.
It's unlikely that you would see businesses larger than 100-200 people in a really free market. There may be several cooperating businesses, but no mega-conglomerates. "Limited liability incorporation is a necessary perk for doing business!" is a common pro-State troll mistake. All limited liability incorporation accomplishes is that it allows management to immune from the negative consequences of misconduct and failure. Limited liability incorporation gives management a free put option to declare bankruptcy and cheat their creditors.
Contrary to what most pro-State troll (L)libertarians say, limited liability incorporation won't occur in a really free market.
Friday, December 11, 2009
This article was pretty funny.
If you're an "expert on Constitutional law", your goal is not "Interpret what the Constitution actually says." Your goal is "Predict how the Supreme Court will rule on specific issues." All "Constitutional law experts" working at universities are making up pro-State propaganda to justify Supreme Court decisions that restrict freedom.
if the Supreme Court adopts a "presumption of constitutionality" by which it defers to the Congress's judgment of the constitutionality of its actions--as it has and as "judicial conservatives" urge--and the Congress adopts Professor Jost's view that "unconstitutionality" means whatever the Supreme Court says, then NO ONE EVER evaluates whether a act of Congress is or is not authorized by the Constitution. A pretty neat trick--and a pretty accurate description of today's constitutional law.That's pretty funny. The Supreme Court says "This law is Constitutional. Otherwise, Congress would not have passed it." Congressmen say "We won't worry if this law is Constitutional. If we're wrong, then the Supreme Court will object."
That is how the evil of the State works. Evil occurs, but nobody is responsible.
Freedom is gradually eroded. It's the "frog in slowly boiling pot of water" story. If freedoms are gradually and slowly eroded, then nobody objects.
With a monopoly, there's no correction when State parasites abuse their power. In a really free market, if you try to abuse your power, then you will be faced with competition.
Members of the Supreme Court are chosen by the President and Congress. It's like picking your best friend to decide your disputes for you.
These "What is Constitutional?" debates illustrate the fallacy of relying on a piece of paper to protect your freedom. If a handful of insiders have a violence monopoly, then there's no restriction when they abuse their power.
Asking "What is Constitutional?" sets the debate in the wrong frame. The question "Is this law Constitutional?" is itself pro-State trolling.
The correct question is "Do the Constitution and Federal government have any legitimacy at all?" The Constitution is not a valid contract. I didn't sign it. State parasites say that I don't have the right to individually withdraw my consent.
Thursday, December 10, 2009
This story was pretty amusing. At the urging of other people, Gandhi wrote some letters to Hitler before World War II.
It would have been more useful to write letters to the people living in Germany, saying "Why are you supporting this lunatic?"
Writing a letter to Hitler sounds as useful as writing a letter to your Congressman. Some people have attempted writing their Congressman asking "Is taxation theft? Is the income tax immoral?" and received pro-State troll responses or canned responses.
Some people are insane and can't be convinced. Debating idiots is a waste of time.
If you're in a position where your wealth and power are backed by the State, then it's very hard to recognize "Government is a scam!"
People want to be the heroes in their own mind. This prevents them from recognizing the truth.
Hitler and State parasites cannot be convinced that their actions are wrong. The only way to convince them is the hard way. If you practice agorism and their scam collapses, then the parasites might learn to change their ways.
Wednesday, December 9, 2009
Glenn Beck is a pro-State troll whose primary role is to distract and subvert (L)libertarians and minarchists. For example, Fox News says that the "Tea Party Movement" is about "Taxes are too high!" rather than "All taxation is theft! The income tax is immoral! The Federal Reserve is a scam!"
I'm not interested in defending Glenn Beck, but this joke is pretty funny. Glenn Beck accepted an advertising contract with Goldline International, a gold coin dealer. Glenn Beck is heavily touting gold as a solid investment. The joke is "It's immoral for Glenn Beck to say 'Gold is a good investment!' when he has an advertising contract with a gold dealer!"
I looked at Goldline International's website. They seem to be promoting American Eagles, which trade at a premium compared to gold bullion rounds/bars. I couldn't do a price comparison, because their website said "Quotes are not current." APMEX and Kitco update their webpage whenever prices change, and usually charge spot plus a fixed amount. Goldline seemed slightly inferior to APMEX and Kitco, but not a complete ripoff.
The only valid aspect of the criticism is "Goldline is not the best gold dealer!" Even if you pay a transaction fee of 5%-10% on a gold purchase, you'll still outperform the market if you hold for several years.
Do you see the joke, regarding the criticism of Glenn Beck?
If it's immoral to tout gold due to an advertising contract, then doesn't that make everyone on CNBC a total scumbag? (but I already knew that)
On CBNC, most of the "analysts" are touting stocks that they or their friends own. Isn't that a conflict of interest?
If it's immoral for Glenn Beck to sell gold, then isn't it immoral for a CEO to advertise the stock of his corporation?
If Jim Cramer mentions a small-cap or mid-cap stock on his show, he can push up the price 5%-10% or more. Jim Cramer doesn't trade stocks himself. However, anyone who knew in advance what Jim Cramer is touting could make a huge profit.
If it's immoral for Glenn Beck to get an endorsement deal with a gold vendor, then isn't it immoral for athletes and celebrities to do endorsement deals?
It seems that the problem is not "Glenn Beck is accepting money as part of an endorsement contract." Every celebrity does that. Everyone on the Communism Channel does that, directly or indirectly. The problem is "Glenn Beck accepted endorsement money in exchange for saying something true that contradicts official State propaganda." It isn't immoral to accept advertising money in exchange for saying something that's actually true!
As I've mentioned here many times, gold has trounced the stock market and nearly every other investment over the past 10 years. Given that information, it isn't immoral to promote gold. I don't think Glenn Beck even emphasizes that point on his show.
A lot of people profit from a corrupt financial system. Gold is a way for individuals to protect themselves from theft via inflation. Glenn Beck is partially exposing the scam.
The problem is not "Glenn Beck accepted an endorsement contract with a gold dealer." The real problem is "Glenn Beck is saying that gold is a good investment and that State paper investments are worthless." There's a lot of mainstream media propaganda pushing a corrupt financial system.
A lot of people profit from a corrupt financial system. That's the real reason Glenn Beck is criticized for advertising gold. Glenn Beck is coming too close to the real truth, and for that he must be punished.
Tuesday, December 8, 2009
A large corporation is a branch of the government. The corporation's management receives many State-granted perks. The corporation is subject to so many laws and regulations that it functions like a government bureaucracy. The corporation's management receive many direct and indirect State subsidies.
There's one evil of corporations that's not frequently mentioned. It's the role that corporations pay as tax collectors.
Whenever you work for a corporation, that corporation's accountants have an obligation to report that transaction to the IRS, via a 1099 or W-2 form. If you're an employee, the corporation has an obligation to withhold taxes from your salary and directly pay them to the State. If you're a contractor paid on a 1099, then the State bureaucrats know about the transaction and will harass you to collect taxes.
This tax collection mechanism occurs without almost anyone questioning it.
Some freedom activists say you should refuse to sign a W-4 form or that you should claim 99 exemptions. If you do this, then the HR department will likely refuse to hire you. No corporation will hire someone who refuses to sign a W-4 form. If you claim 99 exemptions, the HR representative will probably reject your W-4 form as invalid. If you're a new employee and refuse to sign the W-4 form, then your job offer will likely be rescinded.
The practice of mandatory tax withholding was instituted as a "temporary emergency measure" during World War II. Once the bad guys claim an erosion of freedom, it becomes permanent and irrevocable. This "temporary emergency tax" is now permanent, with war as the excuse for imposing this restriction of freedom. As usual, War is the Health of the State. Freedom is eroded during war, and those erosions of freedom are permanent after the war ends.
Corporations control nearly the entire economy. If you refuse to work for *ANY* corporation, your employment opportunities are severely limited. Even if you work for a corporation as a contractor or consultant, the transaction is still reported to the State.
All economic activity must be reported to the State and taxed. This is a complete perversion of the idea that we live in a country of free individuals.
If you start an on-the-books business, you have an obligation to figure out how much tax you owe and pay it. If you're perform the calculation incorrectly, or refuse to do it, then armed thugs will come to kidnap/assault/kill you. All business owners are forced to work for the State as unpaid tax collectors.
What is the risk of State armed thugs assaulting you if you start an off-the-books business? The only way to try is to find out.
This is a very lucrative arrangement for the parasites. They don't have to perform any of the risks associated with operating a business. They get a cut of 50% or more out of *EVERY* transaction, while performing no useful work themselves.
If you start a small business and fail, you risk losing your savings and home and your time invested. The parasites take no such risk.
No "business" has greater profit margins than that of government.
Monday, December 7, 2009
I liked this article on Yahoo. In protest of high cigarette taxes, some people are growing their own tobacco to avoid the tax.
With greenhouses and plant lamps, people are growing their own tobacco even in parts of the country where the climate is otherwise unsuitable.
The article mentioned people growing their own tobacco. If you're going to the trouble of growing your own tobacco, you might as well make enough for a few other people as well. Then, you can sell it off-the-books for profit.
The fact that cigarette taxes are so high makes this a lucrative business opportunity for agorists.
The same applies to people who make their own alcohol to avoid alcohol taxes.
Division of labor is a good thing. If you're growing your own tobacco or making your own alcohol, you might as well make some extra and sell it to your friends. The key is to make sure that your friends won't rat you out to the State. If you stick to a small scale, enough for only 50-100 people, then it's hard/unlikely for State enforcers to violently crack down.
Sunday, December 6, 2009
In this thread on mises.org, someone was asking about different competing philosophies of economics.
Keynesian economics is a bunch of lies used to justify fiat money and State intervention in the economy. It started becoming popular in the 1930s as a way of justifying the default on the gold standard and gold confiscation by Roosevelt, along with the New Deal and Welfare State.
(Some commenters got angry that I said "Keynesian economics is a bunch of lies and propaganda." I don't understand that one. A common pro-State troll belief is "Don't say that ideas are stupid." It is important and necessary to call out stupid ideas as stupid, lest stupid ideas spread without being questioned.)
Austrian economics is better. As far as I can tell, it's about sound money and little/no government regulation of the monetary system.
Another important one is "counter-economics", which is the idea that people should just ignore the government and form competing free market based organizations. Agorism is the only consistent theory of economics and politics.
Saturday, December 5, 2009
Another important evil fnord is "If it's on TV or in the newspapers, then it must be true."
Even before I achieved greater awareness, I figured out that newspapers don't always get the facts straight. I was involved in non-controversial events that were covered in the local newspaper. The newspaper still got the facts wrong. This wasn't a censorship issue, just getting details outright wrong. I knew they were wrong, because I was at the event.
A pro-State troll thinks "There are a lot of people who make sure that the content presented on TV is important and accurate. They wouldn't lie to us!"
A pro-State troll says "The editors make sure that all the content presented on TV and in newspapers is of a high quality! There's no editor filtering bloggers on the Internet, but there should be!" Is the editor ensuring a high quality of content? Or, is the editor enforcing unwritten censorship standards?
The mainstream media is losing market share to the Internet. I'd rather spend an hour reading my favorite blogs, than reading a newspaper. The problem is not "The Internet is evil!" The problem is that the mainstream media is a bunch of pro-State trolls, but writers on the Internet bypass the State censorship engine.
If I had to get my article published in a peer-reviewed journal, I'd never be able to publish "The Compound Interest Paradox" or "The Black-Scholes Forumula is Wrong!" My article would be calling out my peers as frauds, and they'd never consent to publishing it.
Even though there are 100+ channels on your cable service, they're owned by a small handful of corporations. This provides the illusion of openness, when it's really a cartel.
If I wanted to create my own TV show or TV channel, I'd have a hard time getting a cable network to carry it. A pro-State troll might say "Good! Someone is making sure that all content is of a high quality!" This also leads to censorship.
There's also "lie by repeated assertion". If the same lie is repeated everywhere, then people act as if it's true. Some lies are never explicitly stated, such as "Taxation is not theft!"; that's merely an implicit hidden assumption in all other political discussion.
Most people assume, by default, that everything they see on TV and in newspapers is true. If there were some important issue like "Taxation is theft!" or "The USA has a corrupt monetary system!", then surely some newspaper or TV news program would have covered the topic. In this manner, mainstream media censorship assists the evils of the State. Most people think "The mainstream media is an independent auditor of the government!", when the reality is that the same insiders control the mainstream media and the government.
Friday, December 4, 2009
When browsing the Internet, I stumbled across the story of Ward Churchill. It's an interesting example of what happens to a State-licensed thinker who decides to criticize the State. Ward Churchill was a tenured professor at the University of Colorado.
Some pro-State trolls ask:
- Why don't economics or political science professors say "Taxation is theft!"?
- Why don't economists write about the Compound Interest Paradox?
- Why doesn't some university psychiatry professor realize that the "chemical imbalance" theory of mental illness is nonsense?
Ward Churchill wrote a controversial essay critical of US policy before the World Trade Center terrorist attack.
As usual, he said something intelligent and stupid in the same essay. He said that the terrorist attack was blowback for bad US foreign policy. He said that most of the people working in the World Trade Center deserved to die. I agree with the "blowback" issue, but disagree with the "deserved to die" point.
Ward Churchill wrote something intelligent and stupid in the same essay. This is common for people who are cracking their pro-State brainwashing. You only overcome your pro-State brainwashing a bit at a time. Initially, your thoughts are very muddled and some of your ideas aren't articulated clearly.
Just because Ward Churchill said something stupid, that doesn't mean he should be fired and forfeit his entire career. This is the Strawman Fallacy. He should be evaluated based on his entire career, and not the stupidest thing he ever did. Tenure is supposed to provide a professor with the freedom to write whatever he wants, even if it offends people. Tenure is supposed to provide professors with complete academic freedom. The Ward Churchill incident indicates that a tenured professor does not have true academic freedom; if he crosses a certain censorship threshold, then he will be fired.
If someone is evaluated based on the most foolish thing they ever did, that makes people very reluctant to try non-mainstream ideas. If you have non-mainstream ideas, some of them will be good and some of them will be bad. It's important to evaluate each idea independently. If I'm worried that people will get offended, then that makes me reluctant to state controversial ideas. If I had a mainstream media TV show or newspaper column, then I risk getting fired if I say something that offends a vocal group of people who are profiting from State violence.
A lot of people working in the World Trade Center were working in the financial industry. As I've mentioned before, the financial industry produces no useful goods or services. The financial industry is purely parasitic. However, that is not justification for murdering them. Most financial industry workers are unaware that they're participating in a humongous scam. The correct solution is to build free market alternatives to the financial industry extortion racket.
If you're a high-ranking State bureaucrat, a successful terrorist attack is like a huge bonanza. A successful terrorist attack is a justification for a vast increase in State power. Many groups like the ACLU opposed laws like the Patriot Act, which had been planned for a long time. After the terrorist attack, several bad laws expanding State power were passed without opposition. As usual, war is the health of the State.
After a successful terrorist attack, State bureaucrats say "We failed to do our job. Give us more power and more resources!" With an absolute monopoly, State bureaucrats are paradoxically rewarded when they fail.
Ward Churchill advocated for the elimination of government, although he didn't make an argument for agorism like I do. Politicians said "If Ward Churchill is advocating for the elimination of government, then we shouldn't be forced to pay his salary!" Notice that politicians aren't paying a professor's salary with their own personal money. They're paying it with property stolen via taxes. A more accurate statement is "If we're stealing from people, then we won't use that stolen property to pay people who say that our theft is wrong!"
Working for a mainstream media corporation is like working for the government. If you criticize the State, then advertisers will refuse to place ads on your program. If necessary, they will threaten to pull their ads from the entire corporation, and not just one show. The net effect is censorship, imposed via "market forces".
Saying "Government is a massive criminal conspiracy!" is not the same as advocating for violence against State employees. I couldn't find a good reference for what Ward Churchill was exactly saying; I'm summarizing.
If you contradict official State propaganda or criticize the State, then you lose your job and your career. "This policeman is racist!" is an example of valid criticism, because it doesn't question the State itself. The recommended solution for "This policeman is racist!" is "Increase State power so that racist policemen are punished!" If someone starts saying "Who needs a government?", then that's too close to the truth.
Also remember that a professor who says "Who needs a government?" is essentially calling out all his colleagues as frauds. He's telling the truth, while they're all ****suckers looking for an easy paycheck. However, if you know that government is a massive criminal conspiracy, then isn't it hypocritical to work at a university, where your salary is paid by the State?
Ward Churchill won a best teacher award, which was withheld due to the controversy. Critics say that students voted for Ward Churchill in an attempt to influence the controversy. What's wrong with that? If Ward Churchill's statement was so offensive, then shouldn't almost no students have voted for him?
The University of Colorado fired Ward Churchill due to his remarks and the surrounding media hype. The media overreacted to the professor's comments, leaving the university State bureaucrats no choice but to fire him. He was fired even though he had tenure, which is supposed to protect academic freedom. The whole point of tenure is to allow a professor the freedom to say things that others find unpopular.
The workings of a State University are nearly completely uncorrelated with actual useful productive work. It makes no difference if a professor is a brilliant thinker or an unqualified hack. Either way, his salary is guaranteed via State violence.
The "academic misconduct" charges against Ward Churchill were fabricated after State bureaucrats already decided to fire him. If his research was lousy or plagiarized, shouldn't the university bureaucrats have discovered this before awarding him tenure? The "academic misconduct" charge allows the State bureaucrats to say "We fired him for fraud!" instead of "We fired him for criticizing us!"
In a true free market, there's no such thing as tenure. You only keep your job as long as you're producing something useful. A university professor gets tenure, because his salary is backed by taxation/theft. If a free market school gave people tenure and kept employees who didn't deserve it, then it would lose out to competitors who don't have useless employees on their payroll.
Ward Churchill sued the university for wrongful termination. A jury ruled that he was incorrectly fired, but awarded only $1 damages. The trial judge overturned the verdict. The reason is that he could have used the verdict as justification for demanding reinstatement on his job. That pretty much defeats the purpose of trial by jury, if a judge will throw out the verdict when you win. The judge's justification for throwing out the verdict was "The State bureaucrats at the university are protected by sovereign immunity. They were just doing their job, and therefore Ward Churchill could not sue them for misconduct."
Notice that a judge overturning a jury's verdict gives the State bureaucrats a mulligan. If the jury voted the defendants "not responsible", then that would be the end of the issue. By having a jury verdict, but the judge later discarding it, that effectively gives the bad guys two chances to win. If the judge already decided that the defendants were protected via sovereign immunity, then why bother with the farce of a trial? The judge probably was hoping that the jury would vote "not responsible", bringing an end to the issue. When the jury failed to toe the Statist party line, then the judge overturned the verdict. The bad guys were overconfident that they would win in a trial. After they lost, the judge made up an excuse to overturn the verdict.
A university professor does *NOT* have true academic freedom. He has academic freedom *PROVIDED* he doesn't cross a certain censorship threshold.
The number of people seeking an academic career is far greater than the number of slots available. It's very easy for the bad guys to fire someone and find a replacement. There is not a free market for academic research, because it's all funded by the State. It makes no difference if the best thinkers are hired as university professors, or actually the best ****suckers get hired. Contrast that with working as a wage slave software engineer. Even though I had bad experiences at previous jobs, I'm still able to find another job. There are a lot of people looking for software engineer jobs, but very few who really know their stuff. After getting fired, Ward Churchill's career is over, because his only option is to work for the State in a university.
Critics like Noam Chomsky are allowed, because they present a weak criticism of the State. Noam Chomsky's version of anarchy is pro-State trolling. By presenting fools as advocates for anarchy, that makes government seem desirable.
Ward Churchill's career was ruined. He invested many years in his academic career, and it's now worthless. No other university will hire him. The State has a monopoly for funding universities, so he's unable to get another job. It's almost exactly like someone in Communist Russia or China being jailed for criticizing the State. Ward Churchill wasn't explicitly jailed, but he'll be unable to find another job as a professor.
Ward Churchill was making almost $100k/year. That's a pretty sweet deal for someone with no useful skills! The State pays its ****suckers well!
Notice that, via tenure and the fact that a professor has no marketable skills, a professor who gets fired is SOL. This allows State bureaucrats to control professors. Also notice that a professor who is denied tenure is usually just as screwed as Ward Churchill. As a wage slave software engineer, at least I can find another job when my employer ****s me over. The rules of the economic system are biased against me, but there's still a certain level of demand for people who really know what they're doing.
Of course, all university professors are State employees and almost all are parasites. Did Ward Churchill intentionally say something too close to the truth, or did he accidentally stumble in that direction? In either case, all other university professors are aware of this case. They are wimps who are afraid to risk their jobs. They will all write articles saying "Ward Churchill was a scumbag who deserved to get fired!" instead of "He was unfairly fired for criticizing the State!" Other professors will carefully self-censor their work, so they don't have their career ruined like Ward Churchill.
This story is very similar to what happened to Bill Maher's ABC show. He expressed sympathy for the Islamic terrorists' point of view. As punishment, his show was canceled. At least Bill Maher was able to find a show on another channel.
Ironically, as a small unknown blogger, I have more academic freedom than a tenured professor at a university. If I attempt "promote agorism via standup comedy", I won't hold my breath waiting for a mainstream media program to invite me as a guest. I'm not going to adopt a culture of self-censorship, just to promote my career. If you have a contract with a mainstream media corporation, you're subject to the whims of State insiders just as much as a university professor. If you tell the truth, then there will be an outcry of people demanding you be fired. This censorship means that any viewpoint that is true, but offends a lot of people, cannot be mentioned.
A lot of people profit via State violence. They use their influence to censor critics. Critics aren't usually explicitly jailed, because that would be obviously unfair. A fake free market means that anyone who criticized the State is blacklisted and loses their career.