Monthly Archives: February 2007

Zoning Out Freedom

Unhappy with legislative failure in Richmond, the leaders of the City of Alexandria, Virginia have turned to a new, rather unique, tool in their effort to force local businesses to ban smoking:

Frustrated that the state legislature failed to ban smoking in bars and restaurants, Alexandria officials have come up with a maverick plan of their own that would prohibit smoking in all new eateries and make it more difficult for existing establishments to allow people to light up.

The unusual proposal would use the city’s zoning authority to mandate smoke-free restaurants.

If successful, Alexandria would become the first jurisdiction to bar restaurant smoking in Virginia, where the state legislature severely limits local authority. That means individual governments do not have the power to institute outright smoking bans in restaurants and bars, such as those adopted in the District and several Maryland jurisdictions.

So Alexandria has decided to use its limited powers to achieve the same result.


Alexandria would seize control of the smoking issue with such mundane tools as use permits. When a bar or restaurant came to the city to request a permit, the city would require it to be smoke-free before granting the permit.

And if you own a restaurant that already has a use permit, don’t think that you’re safe:

Restaurants that have permits must agree to go smoke-free in three months or risk future restrictions or even closure.

So much, it seems, for the right of a private business owner to decide how he or she wishes to cater to potential customers. So much for the idea of sitting outside on a summer evening at a restraurant on King Street and smoking a cigar just because you want to. So much for property rights and freedom in the city that George Washington called home.

Cross-Posted At Below The Beltway

It’s All About The Money

The other day, in the comments on Doug’s post about Ron Paul, Kevin and tarran got into it a bit over money. Specifically, they got into the nature of a gold standard, as to why a gold standard makes sense (or doesn’t).

tarran gave a pretty good synopsis of money, and got this response from Kevin:

Gold, like Federal Reserve Notes, or hell anything else for that matter, only has value in the eye of the beholder. We use paper money because we believe it is valueable because it is backed up the force of government. If you and I got together and started using printing our own currency or agreed on another medium of trade for doing business with each other, we would consider it valuable to us; however, if we went to the neighbor’s house to buy his car with our currency or a bunch of gold coins, he would laugh at us because gold or the homemade money is not as valuable to him as the Federal Reserve Notes.

One statement here is true. Gold is valuable because we give it value. After that, things get murky pretty quickly, so I felt it might take a full post to explain this. And to do so, we need to start at the beginning.

At the beginning, anything can be money. Money is an abstract term used to describe a fungible asset that is used between people to ease the process of exchanging goods or services. All that is required for something to be money is that it is used by people to settle their debts.

So what could be money? Well, it could be gold. Or it could be specially-printed paper. Or it could be rubber chickens. Or it could be cow feces. It really doesn’t matter what it is, for it to have value. The key to value is that it is agreed by both parties to a transaction that whatever is being used to barter has value.

Likewise, that value can come from many places. You can rely on a scarce quantity of a “precious” metal to as denoting a value. You can rely on the promises and force of government to give it its value. But where Kevin says that I couldn’t go to my neighbor and offer him gold coins or our currency in exchange for his vehicle, he is wrong. After all, it is nearly universally accepted that gold, as a metal, has a value on the market: i.e. it can be exchanged for other goods. If we could convince him of the value of our currency– for example, by certifying that it can be exchanged for US dollars, or for a fixed quantity of rubber chickens– he would accept it as currency.

So anything can be money. Everything can be money. But that doesn’t make all money equal. Some money is better than others.

For example, let’s say we decided to back our currency with diamonds. Diamonds are expensive and relatively scarce, right? So why wouldn’t they make just as good of a backing for currency as gold, or other metals? Well, it’s simple. Diamonds— unlike gold— are not uniformly valued by weight, they’re valued based upon the quality of each particular stone. This if I say that my 5,000 dollar note can be redeemed for a 1 carat diamond, that doesn’t mean anything to a holder of that note, because a 1 carat diamond can have a widely variable worth.

What lesson, then, can we draw from this? Money, to be a good type of money, must have relatively predictable value. Note that I didn’t say “fixed” value, by the way. Even gold doesn’t have a fixed value, because they’re still mining for it all over the world, and producing more of it as we speak.

No, for a money to be good, we need for it to have predictable value. Gold works well for this, of course, because it’s relatively scarce and difficult to pull out of the ground, so the quantity of it doesn’t change regularly. When refined, it’s of consistent quality, and thus if I back a note by 1/20 ounce of pure gold, it’s value is predictable for anyone who takes that note. Of course, if we, as a world, suddenly decided that gold was worthless (or, as tarran points out, find the secret of alchemy), it would cease to be a good money. But unless we have a better alternative, that’s incredibly unlikely to happen. So backing our currency with gold helps us to retain the predictability of its value.

But currency doesn’t have to be backed to be stable and predictable. For example, if you have a country with very low (1-2%) inflation of their fiat paper currency, it’s value is predictable and there is really no danger in the currency not being backed. Heck, as long as the currency value tracks that of the size of the economy, purchasing power will hold firm. But there’s an implicit assumption here: the government must be trustworthy to retain the value of the currency. When have you ever known government to be trustworthy?

America’s currency has lost 96% of it’s purchasing power since 1913, when the Federal Reserve was created. It’s largely thought that the government’s decision last year to stop reporting the M3 was a sign that they intend to open the floodgates and start printing money like we’ve never seen in this country. And I don’t really need to explain why that’s a bad thing, but I’ll give it a shot.

When we look, as libertarians, at the tax structure, we talk about how the incredible complexity and high tax rates for companies to waste money worrying about how to manage their taxes, rather than how to grow their business. When we look, as libertarians, at the size of government, we talk about how government directing huge federal contracts and creating onerous regulations cause companies to spend time and money trying to meet the requirements of those federal contracts or lobbying to have regulations that favor their own business written into the CFR, at the expense of their own growth.

So what happens when our government inflates our currency at unpredictable and high levels? Well, it forces companies, investors, and individuals to focus on how to beat inflation rather than how to produce more goods and services. They start investing in gold rather than in biomed and nanotechnology. They start putting their money into foreign-denominated markets and assets as a hedge against the falling dollar. And if inflation gets bad enough, we’ll see a point at which other governments no longer use the dollar as their reserve currency, and we’ll finally have to start paying for the cost of our own government. None of us want to do that. Look around at the countries facing high inflation. They’re consistently the worst economic performers. This isn’t an accident, and we need to control inflation to keep it from happening here.

So what does that mean for the gold standard? Nothing really— we don’t necessarily need to be on a gold standard. But being on some sort of standard would force our government to stop inflating the currency and causing problems for us down the road. Of course, if we could trust our government to retain the value of our fiat currency, we wouldn’t have a problem either, but that’s highly unlikely these days, and the government here is getting more and more untrustworthy as it grows.

He’s a rebel…

Let’s say you are a candidate for President in 2008 and you’ve been criticized by a leading pro-growth organization. I would think that you’d attempt to make some in-roads with a very disenfranchised group of voters.

But not Mike Huckabee, who is looking to Congressman Don Young to rally support in Congress:

At a time when congressional support is hard to come by, including support for candidates like John McCain, Rudy Giuliani and Mitt Romney, Huckabee is surely eager to count on any support he can get within the halls of Congress. Is Young’s support worth it?

While Young praised Huckabee as a “hell of a speaker” and one who could lead a “reawakening of the conservative values that make our country a land of opportunity,” the House’s resident Alaskan has had trouble keeping his own conservative credentials intact.

Young, known for his handiwork as the former House Transportation Committee chairman, tried to stick U.S. taxpayers with a bill of almost $500 million back in 2005 to fund bridge projects in Alaska.

The project, known as the “bridge to nowhere,” would have connected Ketchikan, a town of 8,000, to the airport at Gravina Island, which had a population of 50. The other project was to link Point MacKenzie, which at the time had a population just over 100, with Anchorage.

(The Ketchikan/Gravina Island route has ferry service and Alaskan officials announced two weeks ago that within two years ferry service between Point MacKenzie and Anchorage will begin.)

Conservatives in Congress removed the earmarks for these tax-wasting projects, but they weren’t the only pork projects Young tried to steer to his state.

Stephen Spruiell, writing for the National Review, pointed out that Young, with help from other Alaskans in Congress, has “steered” numerous special projects to the northernmost state, which include: “$1.8 million for berry research; $1.8 million for sea-otter recovery; $10 million for a psychiatric-treatment facility; $48 million in subsidies for the timber industry; and $500,000 to paint a giant salmon on an Alaska Airlines jetliner.”

Young does not try to hide his love for pork; in fact, he openly brags about directing millions of taxpayers’ dollars to his state. He is neither the poster boy for fiscal restraint nor conservatism, yet Huckabee doesn’t appear to be worried about his newly established link to one of Congress’ big spenders.

Is Islamofascism a Legitimate Threat to Liberty?

In my recent post about Michael Charles Smith, I received a response from a reader by the name of Carl Deen regarding my support for the war against terror Islamofascism (Not the war on terror. Terrorism is the method the Islamofascist uses to accomplish his political-religious goals). I think his challenge is worth a post of its own so rather than responding in the original post, I have decided to answer him here.

Deen writes:

Let’s see if I understand the author. Without provocation, much like Germany did to Poland, the USA invaded Iraq, a country that was no threat to us; however, because, we did, we cannot admit our mistakes and withdraw. I suppose, by that reasoning, we must stay there forever at a cost of $500 billion and the lives of several hundred solders a year.

According to the author, Islam is a threat to us; therefore, we must attack and meddle in their affairs. It doesn’t occur to the author that if you attack and meddle in their affairs, you make more enemies than if you leave them alone.

Oh, I forgot; they hate us for our freedoms. Therefore, by using the war as reasons to turn the USA into a police state, they will stop hating us because we will have lost our remaining freedoms.

Was Iraq a threat to the United States?

First of all, the comparisons of the U.S. to Nazi Germany are getting very tiresome. Whatever ‘atrocities’ the U.S. has committed pale in comparison to the Holocaust. I also reject the premise that Iraq was no threat to the U.S. Regardless of whether or not Saddam had WMD, he was a threat to the U.S. Saddam did in fact invade Kuwait in the early 1990’s to steal the Kuwait’s oil. Had Saddam been allowed to proceed, there would have been national security threats as well as economic threats to the U.S. and the world.

When Saddam surrendered to the international coalition, there were certain conditions that he agreed to so that he could continue to be in power. Among those conditions were that he was not to reconstitute his WMD program and was restricted from flying in the ‘no fly zones.’ To enforce the agreement, coalition fighters patrolled the no fly zones from the time of the surrender to the beginning of Operation Iraqi Freedom. Saddam routinely fired with anti-aircraft weapons on the coalition fighters patrolling the no fly zones, directly putting the lives of U.S. and coalition pilots at risk. These attacks were provocative acts of war.

Let’s also not forget that Saddam attempted to assassinate former President Bush. Regardless of how you feel about President Bush, he was a president of the United States. An attack on the president—any American president is a provocative act of war against the United States.

And then there were the families of the suicide bombers who Saddam paid to spread terrorism throughout Israel. Sure, he was not paying suicide bombers to make attacks in American cities (as far as we know anyway), but this still proved that he was not above such tactics. Though the 9/11 commission found no links between Saddam Hussein and the terror attacks of September 11, 2001, the commission did find that attempts were made between Saddam and Bin Laden to form an alliance. Their ties however, were non-operational. Had Saddam been as far along in his WMD program as most of the world’s intelligence agencies and world leaders had thought, it is not out of the realm of possibility to believe that those ties could have eventually become operational making it possible for Islamofascits to gain access to this material and carry out an attack on the U.S. Based on Saddam’s track record (his use of chemical and biological weapons on his own people, for example), there was no reason to believe that he did not have WMD. U.S. intelligence had underestimated Saddam’s progress in his WMD programs in the past. If left unchecked, he would have.

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