Public Education – A View From Outside The Matrix

Posted by Jason | Posted in Education, Government | Posted on 30-11-2009

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If you have not read my previous post, Thanksgiving, Statism and Life Outside the Matrix, you may want to do so first. This will be my first post where I will challenge the assumption of public education, which is what provides us our programming to live within the Matrix.

As I said in my previous post, both sides of the Matrix structure argue about how to best improve public education. One argues for more money. The other argues for more localized control. Neither side questions the existence of government controlled education, the results over the long term, or whether we’d be better off with no government education.

To start, why do statists claim we need a public school system? They claim that all children need an education, and only government can make sure all children regardless of race, class, and gender receive an education. That sounds reasonable, but are the children, especially the poor really getting educated? According to The Daily Beast, 7,200 students drop out every day. In some cities (usually ran by socialists), it’s even worse. In Detroit, only 25% of students graduate. According to CNN, the nationwide dropout rate is 16% or over 6 million students.

Every single school day, more than 7,200 kids, on average, drop out of high school—1.3 million each year. In many American cities, including Miami, Denver, Los Angeles, New York and Minneapolis, most public school students don’t graduate. In Detroit, the unhappy poster child for American industrial decline, a study from last year showed that a mere quarter of students earn high school diplomas.

via America’s Dropout Crisis – Page 1 – The Daily Beast.

Nearly 6.2 million students in the United States between the ages of 16 and 24 in 2007 dropped out of high school, fueling what a report released Tuesday called “a persistent high school dropout crisis.”

The total represents 16 percent of all people in the United States in that age range in 2007. Most of the dropouts were Latino or black, according to a report by the Center for Labor Market Studies at Northeastern University in Boston, Massachusetts, and the Alternative Schools Network in Chicago, Illinois.

via ‘High school dropout crisis’ continues in U.S., study says – CNN.com.

As you can see, the groups most affected by the dropout rate are the groups that socialists claim to champion. Students are dropping out left and right, which does not provide them many options for the future. Then again, why worry? We have a “safety net”. You know if you don’t go to school, you can at least live off the government dole. On top of that, you can partake in criminal activity and receive tax free income. “Cash only please for all drug and stolen good purchases”.

“Yeah, OK Prof, but literacy was horrendous.” Well, let’s take a look at the “improving” literacy. As we all know, slaves were systematically prevented from learning to read and becoming educated, so we can’t really count their literacy under slavery. We can look at how quickly they became literate after slavery ended.

Although the black literacy rate soared from 20% in 1850 to nearly 80% in 1890, blacks were still having a difficult time finding work.

via ljonespage4content.

Wow, that’s damn impressive. Black literacy reached 80% in 1890. Well, what is it now? Hmmm, under our socialized, secular government ignorance programs, it stands at about 60%.

Six decades later, at the end of the twentieth century, the National Adult Literacy Survey and the National Assessment of Educational Progress say 40 percent of blacks and 17 percent of whites can’t read at all. Put another way, black illiteracy doubled, white illiteracy quadrupled.

via Intellectual Espionage – John Taylor Gatto.

White literacy was near 100% at the beginning of the 20th century, and as you can see, it is now at about where the formers slaves were in 1890. According to John Quincy Adams, only 4/10ths of 1 percent of New Englanders were illiterate. Also, I think everyone would agree the books that were read back then were much more challenging.  Isn’t progress wonderful?

How about math and science scores? Well, according to international testing, American children are not what they used to be. The bad news is the longer they are in school, the worse they get.

At science and math, American students trail those in other advanced democracies. The longer students are in school, the worse things get. Among fourth graders, U.S. students rank high on the International Test of Mathematics and Science Study (TIMSS). Despite this head start, by eighth grade, American adolescents have slipped to the midpoint on the TIMSS; by age 17, their scores trail all but those in a few developing countries

via Hoover Institution – Hoover Digest – The Decline and Fall of American Education.

So as you can see, the public schools in our country have failed as all government planned goods and services do. The debate then goes straight to “how do we make them better?” This is the debate that rages inside the statist Matrix. Both sides argue back and forth about how to improve it. The cheerleaders hooray their side and boo the other side, and it’s completely incomprehensible to them that maybe the government should not be forcing people into government schools. All coercive monopolies are bad, and government is a coercive monopoly. If you do not believe so, try to “choose” to keep your children out of government approved schooling. See how long before you go to jail.

What is the solution? Well, let’s start off by agreeing that we should not stick a gun to people’s heads and tell them they are either going to send their children to government schools, or else they will go to jail. Can we agree that is the moral thing to do? I’m sure some will argue that some parents just are too stupid to make sure their kids get educated, so government must stick a gun to your head. The argument goes that because a small group isn’t responsible with their children, the government should stick a gun to everyone’s head and force their kids into public schools. Pro-government school people argue it’s child abuse to not let your child get an education, but then have no problem with the abuse government schools are inflicting on our children at increasing rates as the statistics above show. Let’s not even get into the lunch programs they inflict on children.

Next, let’s let people choose how they want their kids to be educated. If you do not want to send your child to a government school, there is no reason you should have to pay for government schools plus a private school. Do you think this has something to do with why poorer students are worse off? Their parents cannot afford to pay for public and private schools, so they suck it up and send them off the the ignorance factories. You should be able to keep your money. At the very least, you should be able to take your tax dollars to the school of your choice.

Then the government should allow the free market to deliver education options. They should not set standards, because their standards are pretty much useless. They deliver horrible results. Private schools will have to deliver to the parent’s liking, or they will automatically be punished with lost tuition. Government, on the other hand, has no accountability. If you don’t like the results, you still pay for it. If you try not to pay for it, well you know what happens.

Why is it so hard to imagine a world without public schools? It’s hard to imagine because it’s part of your programming. You were brought up in public schooling and taught that you must have public schools. It’s like most of society in the early 1800s, who couldn’t comprehend how former slaves and former slave masters could live in the same society if slavery was abolished.  Instead of admitting it was immoral, abolishing the institution, and letting free men figure their own way out of it, the government legalized slavery every step of the way. They couldn’t see outside the Matrix in which they were living. If the government had not enforced slavery through fugitive slave laws, it’s hard to believe slavery would have lasted long at all. It would have cost plantation owners too much money to chase slaves down when they escaped. They were only able to do so, because government (really the tax payer) ate the cost of chasing them down and returning them. It would have actually been cheaper for plantation owners to hire the slaves or any other workers had they not forced the cost of fugitive slave laws on the society as a whole. What I am saying here is just because you can’t imagine something other than government schools, because you have been programmed to only see it that way, doesn’t mean it’s not possible and better.  When men are free to make choices in their best interest, society progresses more quickly. It is not happenstance that the least regulated areas in our life are all the fast growing and evolving areas, and there is no reason education cannot be the same.

It’s very easy to see how education if unleashed from government shackles could quickly skyrocket in the success it delivers. It’s not hard to envision bountiful options to meet the needs of all children. Does your child excel in math? How about a school that focuses on math, engineering, and computers? Has your child always loved being the center or attention? How about a school that focuses on the arts? Does your child love to fix things and find out how they work? How about a tech school? Do you want your child to focus on reading, writing, and math? How about an elementary school that focuses exclusively on fundamentals? Does your child have special needs? How about a school that specializes in teaching kids with the same needs as your child? Does your child have many interests? How about a school that brings in great teachers from around the country via video conferencing? Better yet, if your child goes to any of the other schools mentioned, how about those schools bringing in the best teachers in their focused area via video? How about sending your child to a school whose competitive advantage is small class sizes? How about a retired NASA scientist being able to teach students without a teaching degree? How about parents, who know their kids best, deciding what school is best for their child. It is not hard to imagine options and schools opening all over the place.

Why would so many schools open? Because there are greedy profiteers out there, and guess what. They have to deliver a quality service in the private sector. According to the 2007 census, the average cost per student in public schools was $9,000. Do you think for one second there wouldn’t be businesses competing for that $9,000 per pupil and driving the cost down? It happens in every other sector of our economy. Well, it does until the government gets jealous and decides to jump into the game.

While I’m sure the diehard statists can never imagine education without Uncle Sam forcing us into a one size fits none system, I hope some of you question your assumptions about our supposed need for public schools. Hopefully, when you hear politicians debating more funding for education, higher national standards, or any other top down school program, you will question it more deeply. You will ask why they would do that in the first place. How does that open up choices? Does not having choices provide better results? Who benefits from this?

Take the Red pill, and ask yourself, “If I could disregard all laws related to education, what would I choose for my child or for myself when I was a child? Would I send them to government schools, or would I send them to schools who must prove themselves in order to get my money?”

PS. Please ignore all spelling, grammar, and punctuation errors. I learned those in public school.

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Obama’s Trickle Up Economics Is Working

Posted by Jason | Posted in Economics, Government | Posted on 30-11-2009

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Thanks to Obama’s economic policies and bail outs, you no longer have to be concerned about Wall Street execs not being able to afford their lavish lifestyle.

Conspicuous consumption is making a comeback on Wall Street. But no one wants to admit they’re doing it. As traders and investment bankers near the finish line of what looks like a boom year for pay, some are spending money like the financial crisis never happened. From $15,000-a-week Caribbean getaways to art auctions to $200,000 platinum wristwatches that automatically adjust for leap years, signs of the good life are returning. “What we’re seeing in the last four to eight weeks is a fairly substantial uptick” in demand for extravagant purchases as Wall Street employees grow more confident that the market’s

via Wall Street Starts Spending Again – WSJ.com.

I have been so concerned. This is going to be a great Christmas for Goldman Sachs, Citigroup, etc. Don’t you see how Trickle Up Economics works? Obama takes money from the middle class, gives it to Wall Street, GM, etc. Then when they spend money on trips, jewelry, etc, we get some of it back as employees working for the companies from who they buy. I know you didn’t get as much back, but that’s where the Trickle Up comes in.

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Obama and Business Owners Differ On How To Create Jobs

Posted by Jason | Posted in Government | Posted on 30-11-2009

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Go figure! Business owners who create jobs everyday differ from our President, who never created or worked at a job that had a real economic value to it.

Businesses of all sizes are brimming with proposals they say would spur economic growth. The most commonly voiced are tax cuts and boosting access to credit

The White House, for its part, wants to discuss job growth in the clean-tech sector and shifting some stimulus spending to infrastructure projects. Obama aides are also eyeing a limited range of incentives for small businesses to create jobs.

Business want tax cuts without spending cuts, and Obama wants more government spending. Wonder why gold keeps going up? If businesses weren’t looking for handouts, they’d be asking for the government to get the hell out of the economy and quit “boosting access to credit”. It’s the boosting of access to credit that created the bubble that just burst and now leaves them in the predicament they are in. We really cannot expect any better from Obama than more government spending. He believes all life’s value comes from the hand of government. Besides, the media has told him repeatedly how smart his is. “He’s possibly the most intellectual President we’ve ever had.”

Another point of contention: A number of chief executives say the government should clear up uncertainty over health care, energy prices and financial regulations. “Companies large and small are saying, ‘I am not going to do anything until these things — health care, climate legislation — go away or are resolved,’ ” said Dan DiMicco, chief executive of steelmaker Nucor Corp.

Who didn’t know that government medaling is causing businesses to stand still? How about government drop all this stuff, so businesses can get back to what they do best, which is creating economic value.

“Hiring often takes time to catch up to economic growth,” said Valerie Jarrett, an adviser on business issues to President Barack Obama.

Thanks Commissar Jarrett! When will we have economic growth?

Among those invited are the chief executives of Boeing Co., AT&T Inc. and FedEx Corp., along with the heads of many smaller companies.

Oh boy. I’m sure these big companies will not ask for government money. Do they bring their own money jars, or does Obama hand them out at the door?

For small businesses, the No. 1 issue is credit, which remains tight despite the billions spent by the government helping ailing banks.

Yeah, but just imagine how much worse things would be if we didn’t give almost $1 trillion to Obama’s buddies. Right! We bailed out Wall Street in order to bail out Main Street. I don’t think credit is going to make a dimes worth a difference when you have the Federal governments foot pressed firmly down on your neck. Again, easy credit lead to this mess. Expanding credit will not fix the problem. It will just setup the next bubble followed by more disaster down the future. Then again! The government can step in and take more control when the next bubble bursts.

Ron DeFeo, CEO of Terex Corp., a maker of heavy construction equipment, said tight credit is hurting his customers. “Small businesses are having a tough time capitalizing any piece of equipment.” Terex has laid off 4,000 people over the past 15 months. Mr. DeFeo said he would “hire 100 people right now” if the government offset a portion of the new hires’ salary with tax incentives.

via White House, Business Leaders Split on How to Create Jobs – WSJ.com.

Is this supposed to be a reason to go more in debt? This guy says he’d hire 100 people right now if the government would give him more money? That simply means the employees can’t produce enough value to justify paying them. The only way they can justify paying them is with a government subsidy. While I am all for getting rid of taxes, just saying I’ll hire with tax incentives is ridiculous. What he is saying is all the other average Joes out there should give him money so he can make those jobs justifiable. I wonder if this guy pays for health benefits. Would dropping health benefits provide enough to justify the positions? Has he looked into HSA for his employees? Does he have ancient equipment that makes employees less productive, thus making it harder to justify paying them? Who knows. The point is we should not just hand out money to anyone to justify creating jobs. We don’t know if the jobs are worth creating.

If you want real job creation, the government needs to get out of job creation. The free market when left alone creates good jobs for everyone. The jobs are long term, because they can justify themselves. If a job generates profits, it’s justified. If it cannot, it should not be created. If the government would get out of health care, corporate welfare, entitlement programs, environmental frauds, etc, the cost of each job would go down. Guess what happens? Many more jobs then become justifiable, and then they are created.

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Imminent Domain

Posted by Jason | Posted in Government | Posted on 29-11-2009

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If you truly think there are property rights left in America, you sure must have your head firmly in ground or up your a**.  Here is the most recent example of the government taking property from the little guy to give it to their rich buddies. Oh yeah, and these just so happen to be liberals, who claim the love the poor and the down trodden.

The case, Goldstein v. New York State Urban Development Corporation, dealt with plans by developer Forest City Ratner to build a new arena for the Nets as well as snazzy apartments and offices on land currently occupied by homes and businesses. To make way for the sports complex, the state declared the property “blighted” and used its power of eminent domain to hand it to the developer.

Such unabashed takings have an unfortunate history in New York state, where the political class has a habit of using its powers on behalf of well-connected private interests. Caught under the wheels are average citizens whose only recourse is to try to defend their property rights in court.

So much for that. In allowing the property seizure, the Court of Appeals dodged some of the central challenges to the condemnation, including whether the Empire State Development Corporation’s designation of blight in the Atlantic Yards area was applied after the stadium project had already been planned, making it a “pretext.” Nor did the court take on the question—at the heart of eminent domain law since Kelo—whether economic development may be considered a public use under the New York Constitution.

Instead, the majority argued that because the state had designated the area as blighted, the takings were therefore a “public use,” and it was not the place of the court to interfere. Nevermind that the determination of blight was based largely on a study funded by . . . the aspiring developer.

Courts in New York have been famously hostile to eminent domain challenges, but 43 states have adjusted their laws since Kelo to provide stronger protections for property owners. The New York ruling vindicates Justice Sandra Day O’Connor’s prediction in dissent in Kelo that “the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms.” Q.E.D.

via New York Appellate Court Rules in Favor of Basketball Arena Developers – WSJ.com.

Not only does the government take your property whenever it feels like, for whatever reason it feels like, try to not pay your property taxes and see if you really own your property. Property taxes have turned us all into renters. You have to pay the local government your yearly rental fee, which they raise periodically just like all landlords. If you don’t pay, they evict you and take back the property. Then they sell the property to some one else who is under the illusion that they own the property.

So, basically you only have “rights” to the property until the government decides you no longer have the right. You can fool yourself all you want, but really eminent domain has turned into imminent domain.

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Thanksgiving, Statism And Life Outside The Matrix

Posted by Jason | Posted in Economics, Education, Government, Gun Control, Health Care, History | Posted on 28-11-2009

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Over Thanksgiving dinner, my brother and I began our normal debates of politics, war, health care, etc. This year was  a little different.

I’ve always been the typical conservative, who believes the government is a necessary evil that wants to control us more and more with healthcare, welfare, net neutrality and on and on, but we need to maintain a strong military and remain on the offense in the war on terror.

Having always considered my self a free market capitalist, I was reading pro-capitalist books, websites, etc. Eventually, I found myself in a world that challenged my own contradictions. I’ve always realized that liberalism was irrational and illogical, but I always thought conservatism was rational and logical. After reading Ron Paul’s book, End The Fed, I started a debate on Mises.org, a pro-free market site founded to spread the economic ideas of Ludwig von Mises. Like most conservatives, I liked Ron Paul’s belief in the constitution and his domestic policy beliefs, but I thought his foreign policy was isolationist and unrealistic. In the forums, I said I like Ron Paul and would vote for him, but I didn’t believe in his isolationism and questioned whether he believed in a strong military. Having always laughed at liberals and all their contradictions, it was now I who seemed to be the one with contradictions.

Not being used to people debating with logic and reason, I quickly felt like I was being presented an option. The forum users were offering me the Red Pill, leading me on a path which would challenge my assumptions and the Matrix in which we live, or the Blue Pill, in which I could ignore their arguments and stay in the comfort of what I’ve always believed and had reinforced by the Matrix. Having always believed in pursuing TRUTH in spite of fear, ostracizing, or ego, I took the Red Pill. Quickly I realized I was outside the Matrix looking in.

The first thing you realize is the Matrix is constructed of two sides who are opposites of the same contradictory, statist coin. Both believe in using government force in order to compel the populace to live by their terms. One side believes in “national greatness” while the other believes in “national virtue”. Neither fulfills their stated goal, and neither believes in individual liberty. Both sides benefit from the endless debate and the “my team is best” mentality. The Matrix was not constructed over night. It was developed over time piece by piece and quickly became the known world to those who know no alternative to life inside the Matrix. Current generations have had the programming loaded into their minds through the government schools. Even if you attend private schools, you must meet certain mandated “standards”. As an adult, your programming is reinforced with TV shows, news programs, and “educational” programs that reinforce the assumptions that were programmed into you as a child.

The founding institution of the Matrix, the State, is formed by competing parties, which you are encouraged to cheer one as your team and boo the others as the enemy no matter what the topic. Debates rage with differing opinions, but never involve root causes or underlying assumptions. Both sides debate particular wars, but never discuss what caused the war or whether foreign intervention is just and in our best interest (ex: Should our military is deployed in 150 countries). We debate how to best raise the standards of public schools, but no one questions the existence of the public schools or the historical failure of them(ex: Black Americans went from 20% literacy rate in 1860 to 80% by 1890. Now, black Americans have a 60% literacy rate). They debate how to best handle retirement savings, but neither questions whether the government should be handling it at all or the consequences of their mishandling (ex: Inflating Wall Street pay via 401ks and IRAs). Currently, we’re debating health care. One side argues for national health care, and the other argues against it. Neither side debates government involvement and it’s effect on skyrocketing prices in the first place.

It’s not hard to understand why the Matrix is so hard to break free from. It’s all we’ve known. We haven’t experienced schooling without public schools, health care without insurance, a world without US policing, or life without so called “safety nets”. During the debate with my brother, who always argued with my beliefs on foreign policy when I was inside the Matrix, agreed Americans were not looking at the issue properly because they are surrounded by re-enforcing factors such as the media. The media never gives a historical perspective. They only ask what should be done about terrorism or which war we should fight. They never ask why is there terrorism or if we think punishing civilians via embargoes will help them overthrow tyranny. They never ask if we believe it creates less responsibility for Wall Street executives when the Fed drops interest rates to zero and promises to prevent bank failures. They are only asked whether we should have bailouts or not.

The funny thing was as soon as the debate turned to public education, my brother was back in the Matrix. I asked the question of why there should even be public schools, and immediately his programming took hold. “You have to have government schools. How would people get schooling? I don’t think the schools are bad. It’s our culture. Teacher unions aren’t to blame, it’s the parents. You can’t teach a child who’s parent is a drug addict. What about the poor?” On and on the debate raged, but he could not get his head around the fact that the government has created the disastrous system in the first place. He could not comprehend a world without the government. It was if nothing comes about without the government. It’s understandable. Can you imagine arguing what life would be like without slavery in the early 1800s? Surely, you would have been nuts. They were living inside their Matrix, created by generations that came before.

Over the coming months, I will attempt to touch on some of these topics. While I am not an expert, I will present you with Red and Blue pills. The Red pill will question whether our lives our better with government involvement in all aspects of our lives. Is the government really protecting us? Could we live without government? You will have to open your mind and challenge your assumptions if you take the Red pill. On the other hand, you can take the Blue pill. You can stay in your comfort zone, fight the same old fights, assume the government is there for your protection, and live out the consequences of those beliefs. The choice is yours, but you must make a choice.

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Bernanke Fights Back

Posted by Jason | Posted in Economics | Posted on 28-11-2009

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Bernanke appears to be on the ropes. He’s fighting back in the Washington Post.

These matters are complex, and Congress is still in the midst of considering how best to reform financial regulation. I am concerned, however, that a number of the legislative proposals being circulated would significantly reduce the capacity of the Federal Reserve to perform its core functions. Notably, some leading proposals in the Senate would strip the Fed of all its bank regulatory powers. And a House committee recently voted to repeal a 1978 provision that was intended to protect monetary policy from short-term political influence. These measures are very much out of step with the global consensus on the appropriate role of central banks, and they would seriously impair the prospects for economic and financial stability in the United States. The Fed played a major part in arresting the crisis, and we should be seeking to preserve, not degrade, the institution’s ability to foster financial stability and to promote economic recovery without inflation.

To start, Bernanke says he’s concerned congress will significantly reduce the capacity of the Fed to perform it’s core functions. Are we supposed to say “oh boy, wouldn’t want that”? It’s core function is to trick businesses and consumers into spending money and then pulling the carpet out from under them when inflation seems to be getting out of control. It’s core functions caused the mortgage meltdown, the tech bubble, skyrocketing oil prices, and skyrocketing food prices. I sure wouldn’t want those functions being impeded.

The government’s actions to avoid financial collapse last fall — as distasteful and unfair as some undoubtedly were — were unfortunately necessary to prevent a global economic catastrophe that could have rivaled the Great Depression in length and severity, with profound consequences for our economy and society. (I know something about this, having spent my career prior to public service studying these issues.)

Bernanke, in his infinite wisdom, has mastered all there is to know about economics. After all, he’s spent his career studying it. What can be more disastrous than a man who doesn’t recognize there are things he doesn’t even know that he doesn’t know. History abounds with disasters from men who thought they had it all figured out and didn’t realize they were living within their own assumptions.  Can someone have Bernanke study the weather? I’d like someone to control the weather, so it’s a constant 75 degrees.

Moreover, looking to the future, we strongly support measures — including the development of a special bankruptcy regime for financial firms whose disorderly failure would threaten the integrity of the financial system — to ensure that ad hoc interventions of the type we were forced to use last fall never happen again.

via Ben Bernanke – The right fix for the Fed – washingtonpost.com.

While Bernanke says he doesn’t want the Fed politicized, he sure is a politician. They cause the problem and then ask you to look to them to be the ones who solve it. We are supposed to believe if we just give them more power, they swear they’ll protect us. This will never, ever, ever happen again. Oh, don’t read history books, you ignorant common man. Just because the Fed was established almost 100 years ago to make sure these things never, ever happened again, doesn’t mean they don’t mean it this time.

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Obama Brings Big Pharma Into The Family

Posted by Jason | Posted in Global Warming, Health Care | Posted on 27-11-2009

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I’m not saying we are a fascist nation yet, but we are moving closer and closer. Obama’s dealings are looking more and more like Don Corleone. Making an offer they can’t refuse, Big Pharma is falling in line.

In June, the Pharmaceutical Research and Manufacturers of America sealed a deal with the White House and Senate Finance Chairman Max Baucus promising to contribute $80 billion in lower drug costs over the next decade to ObamaCare, plus a multimillion-dollar TV ad campaign. In return they were to be spared from price controls and the reimportation of cheaper foreign drugs.

To hell with the people. Obama and Big Pharma are going to prevent importation of drugs from other countries, which would help drive costs down. In a free market, drug companies would not be able to charge one price to foreign consumers and another, higher price to American consumers. American consumers are subsidizing the research and development, so the rest of the world gets the benefit without the cost. In Corleone fashion Obama threatens price controls (death to your business) to Big Pharma, or they can be a team player and benefit like the rest of those who fall in line with “the family”.

The pharma lobby was unfazed. “Despite the shortcomings in the House legislation, we remain completely committed to helping the President and Congress pass comprehensive health care reform this year,” a senior vice president said in a statement. “This is a three-act play and a good critic doesn’t write a review after the opening scenes.”

Why would pharma be fazed, when the Don gives them his word that they’ll be taken care of?

So how has the industry responded? More or less as Lenin predicted. Big Pharma is now running ads against Joe Lieberman, saying his threat to torpedo the Senate bill could cause drug prices to rise by 20%. It is also funding a campaign that targets the fence-sitters Ben Nelson, Mary Landrieu and Blanche Lincoln.

So after we’ve been told how evil Big Pharma is, how they only care about profits, how they careless if you live or die, and how they hold a gun to your head to make you buy their product, we are now supposed to believe they are looking out for the public, and those who stand against government health care are now the bad ones. Oh, how a little threat from the White House can change things.

via Big Pharma Sells Out on Health Care – WSJ.com.

Now we are supposed to believe that Big Pharma is actually giving something up to the benefit of all of us. Do you really believe they are doing something that isn’t in their best interest? This will lock out imported drugs, preventing price competition. It will prevent smaller drug companies from entering the market, thus preventing competition. It also allows the government more control over the drug business. Once Big Pharma enter the family, they can never leave.

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The True Meaning of Thanksgiving: The Birth of Private Enterprise in America by Richard M. Ebeling

Posted by Jason | Posted in Economics | Posted on 26-11-2009

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The True Meaning of Thanksgiving: The Birth of Private Enterprise in America by Richard M. Ebeling

This time of the year, whether in good economic times or bad, is when Americans gather with their families and friends and enjoy a Thanksgiving meal together. It marks a remembrance of those early Pilgrim Fathers who crossed the uncharted ocean from Europe to make a new start in Plymouth, Massachusetts. What is less appreciated is that Thanksgiving also is a celebration of the birth of free enterprise in America.

The English Puritans, who left Great Britain and sailed across the Atlantic on the Mayflower in 1620, were not only escaping from religious persecution in their homeland. They also wanted to turn their back on what they viewed as the materialistic and greedy corruption of the Old World.

In the New World, they wanted to erect a New Jerusalem that would not only be religiously devout, but be built on a new foundation of communal sharing and social altruism. Their goal was the communism of Plato’s Republic, in which all would work and share in common, knowing neither private property nor self-interested acquisitiveness.

What resulted is recorded in the diary of Governor William Bradford, the head of the colony. The colonists collectively cleared and worked land, but they brought forth neither the bountiful harvest they hoped for, nor did it create a spirit of shared and cheerful brotherhood.

The less industrious members of the colony came late to their work in the fields, and were slow and easy in their labors. Knowing that they and their families were to receive an equal share of whatever the group produced, they saw little reason to be more diligent in their efforts. The harder working among the colonists became resentful that their efforts would be redistributed to the more malingering members of the colony. Soon they, too, were coming late to work and were less energetic in the fields.

As Governor Bradford explained in his old English (though with the spelling modernized):

“For the young men that were able and fit for labor and service did repine that they should spend their time and strength to work for other men’s wives and children, without recompense. The strong, or men of parts, had no more division of food, clothes, etc. then he that was weak and not able to do a quarter the other could; this was thought injustice. The aged and graver men to be ranked and equalized in labor, and food, clothes, etc. with the meaner and younger sort, thought it some indignant and disrespect unto them. And for men’s wives to be commanded to do service for other men, as dressing their meat, washing their clothes, etc. they deemed it a kind of slavery, neither could husbands brook it.”

Because of the disincentives and resentments that spread among the population, crops were sparse and the rationed equal shares from the collective harvest were not enough to ward off starvation and death. Two years of communism in practice had left alive only a fraction of the original number of the Plymouth colonists.

Realizing that another season like those that had just passed would mean the extinction of the entire community, the elders of the colony decided to try something radically different: the introduction of private property rights and the right of the individual families to keep the fruits of their own labor.

As Governor Bradford put it:

“And so assigned to every family a parcel of land, according to the proportion of their number for that end . . . This had a very good success; for it made all hands very industrious, so as much more corn was planted then otherwise would have been by any means the Governor or any other could use, and saved him a great deal of trouble, and gave far better content. The women now went willingly into the field, and took their little-ones with them to set corn, which before would a ledge weakness, and inability; whom to have compelled would have been thought great tyranny and oppression.”

The Plymouth Colony experienced a great bounty of food. Private ownership meant that there was now a close link between work and reward. Industry became the order of the day as the men and women in each family went to the fields on their separate private farms. When the harvest time came, not only did many families produce enough for their own needs, but they had surpluses that they could freely exchange with their neighbors for mutual benefit and improvement.

In Governor Bradford’s words:

“By this time harvest was come, and instead of famine, now God gave them plenty, and the face of things was changed, to the rejoicing of the hearts of many, for which they blessed God. And the effect of their planting was well seen, for all had, one way or other, pretty well to bring the year about, and some of the abler sort and more industrious had to spare, and sell to others, so as any general want or famine hath not been amongst them since to this day.”

Hard experience had taught the Plymouth colonists the fallacy and error in the ideas that since the time of the ancient Greeks had promised paradise through collectivism rather than individualism. As Governor Bradford expressed it:

“The experience that was had in this common course and condition, tried sundry years, and that amongst the Godly and sober men, may well convince of the vanity and conceit of Plato’s and other ancients; — that the taking away of property, and bringing into a common wealth, would make them happy and flourishing; as if they were wiser than God. For this community (so far as it was) was found to breed confusion and discontent, and retard much employment that would have been to their benefit and comfort.”

Read the full article here  In Defense of Capitalism & Human Progress: The True Meaning of Thanksgiving: The Birth of Private Enterprise in America by Richard M. Ebeling.

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The Minimum Wage and Quinn’s First Law

Posted by Jason | Posted in Economics | Posted on 26-11-2009

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Price fixing in any form only harms those people they are supposed to help. On his Nightly Business Report blog, Steven Horwitz, calls on Obama to heed the economic science of the minimum wage.

Economic theory predicts that raising the minimum wage will cause those employees who are least productive to lose their jobs. If we raise the minimum wage from, say, $6 to $7, it’s the same thing as saying “any worker who cannot produce $7 worth of value each hour is not worth hiring.” Younger workers are, of course, among the least skilled in the economy. In addition, thanks to poor schools and historical discrimination, young workers of color are over-represented in this category. Higher minimum wages should disproportionately affect young workers and especially ones of color.

The empirical evidence to support this theoretical claim is abundant. Hundreds of studies of this relationship have been done by economists and they are nearly unanimous that higher minimum wages are associated with some level of increased unemployment among lower-skilled workers. Whatever consensus there might be among climate scientists about global warming, that among economists about minimum wage laws is at least as great (and, as we discovered recently, we don’t need to rig the computer code to make our models reconstruct pre-historic data to come out the way we want). Despite what the science says, the Obama Administration supported a minimum wage increase last July.

The results are as theory predicts: unemployment among whites age 16-19 is at by far the highest rate in 10 years: 25.3% in October, up 28% from 6 months earlier and 36% from a year ago. Among African-Americans of the same age group, the unemployment rate is an intolerable 41.3%, up 19% from April and up 25% from a year earlier. The Hispanic or Latino youth unemployment rates are 35.6% (October), 26.5% (April), and 28.3% (October 2008).

The recent increases in the minimum wage cannot explain all of this increase, as unemployment rates have climbed across the board. However, the overall unemployment rate last April was 8.9% compared to 10.2% today. That’s a 14.6% increase, notably less than the increase in the unemployment rate for young people of any race. So a good chunk of those youth unemployment increases are not just a by-product of the general increase.

If Obama really wants to take science seriously and live up to his promise of being the president for all of America, he could start by asking Congress to repeal the recent increases in the federal minimum wage and thereby give young workers something to really be thankful for this time of year: a much better chance at an entry-level job in an increasingly difficult job market.

via XChange – The NBR Blog.

Again, whether a price ceiling or a price floor, only harm is caused. Also, the harm isn’t felt just by the person who loses the job. The rest of society loses out on the production that would have otherwise been created. Even though it may be a lesser value of production, it is still production. For example, say you have a landscaping company. You pay your student workers, that are off on summer break, $6 an hour. With the rates you are charging, you are able to capture 100 clients. With the revenue from those 100 clients, you have a budget to fund four grass cutters. Now, the minimum wage gets forced up by the government to $7 an hour. Well, now you still have the same rates coming in from 100 clients, but you no longer have the same budget. You have three options. You can layoff one of your guys, you can raise prices or you can cut costs elsewhere. If you lay off one of your guys, how are you going to do the same volume? If you raise prices, demand will go down? If demand goes down, you don’t need the same amount of lawn boys, so you’d end up laying one off anyways. Cutting costs elsewhere only helps if you were  inefficient in the first place. If you were inefficient, you would have been charging too much and not had as many clients to begin with. Also, there typically isn’t tons of overhead in minimum wage jobs, so the chances of cutting your way out of it to save jobs is very slim. This leaves us really two options, both of which results in lost jobs. On top of that, both lead to a reduced amount of customers having their demands met. Only the ones who can afford it will continue to have their lawns attended to. Typically, they are smeared as the rich. So, while the regular Joe might have been able to afford the luxury of having his lawn cut previously, he now cannot, thus hurting the regular Joe and the young worker.

Here in Pittsburgh, our local talk radio personality, Jim Quinn, has what he calls Quinn’s first law. Qinn’s first law is “liberalism creates the exact opposite of it’s stated intent”. I’ve tried finding examples of when this doesn’t hold, but I have yet come up with one.

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Ron Paul and Rick Santelli School CNBC Hosts

Posted by Jason | Posted in Economics, Video | Posted on 25-11-2009

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This video is kind of funny. Money’s price, the interest rate, should float on the free market like any other commodity, but you can tell that the other hosts have never even considered that  a possibility. They keep going back to the independence of the Fed, and how can they properly raise interest rates when it’s unpopular. All these “capitalists” for some reason love central planning when it comes to money.

I never heard Santelli talk monetary policy. I never knew who he was until he called for tea parties. As if calling for tea parties wasn’t enough, talk of how bad the Fed is is even better.

via Paul: Audit the Fed – CNBC.com.

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