Monthly Archives: July 2009

The Perfect Guidebook As We Travel Down The Road To Serfdom

As I’ve noted in the past, sales of Ayn Rand’s Atlas Shrugged have increased significantly over the past year.

Now it appears that the same is happening to Frederich Hayek’s seminal work:

So far this year the most popular edition of Road to Serfdom has sold 11,000 copies. That compares with 3,000 copies at the same point last year. That’s a 263 percent increase for those of you keeping score at home.

Why? Well, no doubt huge new government spending programs and attempts to massively expand the welfare state send people looking for classic literature that makes the case for liberty and limited government. But what the Marxists call the “objective conditions” can always use a bit of help. And indeed, just as I found in investigating the sales bump for Atlas Shrugged, it looks like an op-ed in the Wall Street Journal was instrumental in boosting the sales of The Road to Serfdom.

On February 4, former House Majority Leader Dick Armey, now chairman of Freedomworks, published an op-ed in the Journal titled “Washington Could Use Less Keynes and More Hayek.” Sales of Road to Serfdom, which were in the low hundreds each week since the beginning of 2009, more than doubled over the next four weeks. It seems likely that Armey’s op-ed caused the new interest.

If you haven’t read it yet, you ought to. It does a better job than anything of explaining what’s wrong with where we’re headed in this country.

H/T: United Liberty


Real Solutions for Health Care, Part I – The Problem

If one looks at Barack Obama’s principles for health care, the basic ideas are right. His three principles are:

  • Reduce Costs
  • Guarantee Choice
  • Ensure Quality Care for All

Unfortunately, the health care measures the president is backing shows he clearly doesn’t understand the main problem with American health care.

In America today, doctors rarely answer to patients. Instead, they answer to layers of faceless bureaucracy that ultimately answer to either employers or politicians. This makes doctors unresponsive to patient needs and results in ham-fisted results to control costs like senseless denials from private insurers and underpayments by government health care programs.

This system also presents a clear incentives for patients to get as much as they can without regard to cost. Since costs are borne by insurers and the government, the patient seeking treatment is shielded from them and have no incentive to seek only the treatment they need. In addition, they are further spurred to get “their share” by being set up as adversaries of insurance companies, employers, and the government.

The result of this incentive structure is a completely dysfunctional price system in health care. In a functioning price system, buyer and seller are competing for opposite purposes. The buyer wants to get the most product for the least money, while the seller wants to deliver the least product for the most money. When the price system is working, these incentives balance each other out and prices are controlled.

In health care, insurers-both private and government-try to deliver coverage as cheaply as possible without regard to quality because that’s what their masters want. Patients try to get as much value from their insurers without regard to cost. The result of these crossed incentives is a health care system that doesn’t meet the needs of patients while becoming ever more expensive.

Barack Obama’s health care plan does nothing to change this, and in fact goes to great lengths to make this incentive structure inescapable. Barack Obama, like many before him, is proceeding with good intentions but a poor understanding of what he’s trying to fix. The result is a health care plan that takes our problems and apply them to everyone.

Coming soon: Part II – Divorcing Health Care from Employment

Control Without Responsibility

At Cafe Hayek, a letter to the editor by Andy Morriss to the Wall Street Journal is posted:

Holman Jenkins asks “Does Obama Want to Own the Airlines?” (Business World, July 8). I am sure he does not. Rather than own them, the president and his congressional allies want to control the airlines — a crucial difference as ownership implies taking responsibility.

As Mr. Jenkins notes, the Justice Department’s belated intervention against Continental’s efforts to join the Star Alliance appears aimed at extorting concessions for the Democrats’ union allies. That is not the action of an owner of airline assets but of someone determined to redistribute wealth from airline passengers and shareholders to favored special interests.

One of the many benefits of free markets is that the people who own something are the ones who experience the benefits or losses accruing from their use of it. When considering how some property is going to be used, an owner and non-owner may have very strong opinions. The non-owner, who has less to lose, will be less careful and prudent in their decisionmaking. Moreover, often the non-owner will gain more from the misuse of the item than from its prudent use.

One does not have to look to hard to see this phenomenon in action. The attempt by GM to close dealerships, and thus reduce its losses was overridden by Congressmen interested in using GM’s wealth to buy votes by keeping the dealerships open. And that is one example of literally millions of instances that take place every year from all levels of government.

Obama, leading democrats and some very influential economists have repeatedly expressed the idea that increased government control of the medical industry would reduce costs without sacrificing quality. In their vision selfless government officials will ensure that people receive high quality treatment regardless of the cost, while the market power of government as a customer will ensure that costs will stay low. Against this charming vision stands a great body of evidence from public choice theory; government officials – or their private counterparts in the private-public partnerships in vogue today – will be able to exert control without any consequences. Just as medicare and medicaid administrators proved willing to authorize higher and higher treatment prices – to the point where it threatens the budget of the federal and nearly every state government – the administrators of any new government program will behave in similar uneconomic ways.

Control without responsibility is a very bad idea.

I am an anarcho-capitalist living just west of Boston Massachussetts. I am married, have two children, and am trying to start my own computer consulting company.

Lies, Damn Lies, and California Budget Proposals

The news out of Sacramento appears good for the California middle class:

The good news, Schwarzenegger glowed, is no new taxes.

Digging a little deeper, of course, reveals the truth:


* Accelerate income tax withholding — $1.7 billion
* Increase estimated tax payments for businesses and the self-employed — $610 million

Between now and the end of the year, $2.3 billion will be extracted from the economy in more aggressive tax collection. Where is that money going to come from? Everyone who works:

It also raises $4 billion by in part accelerating personal and corporate income tax withholdings and increasing income tax withholding schedules by 10 percent.

The state will take 10% more than it does today out of every paycheck issued in the State of California. That means that the Californian trying to stay afloat on a mortgage, pay medical bills, or send a kid to school will have less money to do it. The Californian out trying to support local businesses will have less money to do it. The Californian who lives paycheck-to-paycheck will have less money to survive.

Since this is a withholding change, the taxpayer should get the excess withheld back on next year’s tax return. That, though, won’t undo the foreclosure that happened because a Californian couldn’t pay his mortgage. It won’t make right the bankruptcy that occurred because a Californian couldn’t pay her medical bills. It won’t bring back the corner store that went under because people couldn’t afford to shop there.

The simple fact is that this budgetary shell game will cause each and every worker to pay more to the State of California in taxes. The state is so desperate to pass a budget that it is almost certain that this tax hike will pass. All I ask is that the clowns in Sacramento have enough respect for the taxpayers to level with us and admit that their budget contains $2.3 billion in tax hikes…

Fat chance.

Don’t Blame Me Just Because I Voted For Bob Barr

Over the weekend, Melissa Clouthier took the time to take to task those of us who refused to compromise our principles last November and voted for Bob Barr over the atrocious McCain/Palin ticket:

DontBlameBobTShirt[P]eople are coming out of the woodwork saying, “Don’t blame me! I voted for Bob Barr!” I ask you, Is that something to be proud of?

John McCain was a terrible candidate for a myriad of reasons I won’t list here. Rather than blogging anything negative, many times, I just held my tongue. (Other times, not so much.) Why? Do I and all conservatives who voted for John McCain lack a spine and principles? Some would say so. Did I hold my nose and vote for John McCain because I’m a conservative sellout?

I voted for John McCain for precisely the reasons we’re seeing right now. President Barack Obama is a statist. He’s a socialist. He wants to remake America into some liberal delusional utopian fantasy and he’s damn near succeeded at every single thing he’s wanted to do.

My brother was in Venezuela last week and talked to a local businessman who marveled of Chavez,”It’s amazing how much has changed in four years. How quickly it happened.” And it wasn’t good change. And he wasn’t hopeful. Do those who voted for Obama honestly think a slide of Venezuela-like proportions is impossible?

President Obama is a disaster for America and I hold those who voted for Bob Barr every bit as accountable as if the so-called principled person voted for Barack Obama himself. It was a vote that aided and abetted an enemy of freedom. How can a freedom-loving person be proud of this?

First of all, it’s worth noting, as Bruce McQuain does, that those of us who voted for Bob Barr can hardly be blamed for the outcome of the election:

Bob Barr pulled all of 511,324 votes. Statistically that’s 0% of the electorate. Had every Bob Barr voter voted for John McCain, he’d have ended up with 58,854,995 votes instead of 58,343,671 to Obama’s 66,882,230.

So, even if Robert Stacey McCain, Jason Pye, and myself — along with 511,321 other people (or those 181,818 people, like Leslie Carbone, who voted for Chuck Baldwin) — voted for McCain/Palin rather than Barr/Root last November, it would have had absolutely no impact on the election. It wouldn’t have changed the outcome. Heck it wouldn’t have even shifted a single Electoral Vote. Therefore, the good Doctor’s assertion that Barr voters are in any way responsible either for the election of Barack Obama, or any of the policies he’s implemented is simply wrong.

Clouthier acknowledges this simple fact in an update to her post but goes on to insist that McCain would have been better as President, from a libertarian perspective I assume, than Obama has been to date, but that statement belies that fact that John McCain was never the conservative that his supporters claimed he was:

On the issues, John McCain isn’t much better. The difference is that McCain campaigns on rhetoric that makes you think that he believes in individual liberty, self-reliance, and small government. The reality of a hypothetical McCain Administration, though, is demonstrated quite clearly in his response to the financial crisis, his support of the bailout, and his insane idea to have the government buy-up and renegotiate distressed mortgages. These are not the policy proposals of a man who believes in the free market.

Moreover, McCain has run his campaign in a manner that is at the very least offensive and borders on an insult to the intelligence of the American voter. He selected as his Vice-Presidential running mate a woman manifestly unqualified for the job. He engaged in the pointless, some might even say reckless, stunt of pretending to suspend his in response to an economic crisis that he obviously had no real understand as to either the causes or the remedies. And, most recently, he engaged in nearly two weeks of relentlessly negative campaigning that concentrated not on the issues facing the country, but on his opponents alleged associations with someone even he admitted was a “washed up terrorist” and, in the process, brought out some of the worst in his supporters.

I said a long time ago that I would never vote for John McCain based solely on his manifest disdain for one of the fundamental freedoms in the Constitution. Now I can say that, even if he had never sponsored McCain-Feingold, his conduct during the course of this election has demonstrated to me that he is unfit to be President of the United States

The prospect of as President John McCain serving, as he would have, with a Democratic-controlled Congress should not be one that anyone who calls themselves a limited-government free-market fiscal conservative would look forward to, and it was in that spirit that Leslie Carbone made the conservative case against John McCain back in October:

If McCain is president, thanks to conservative votes, it will be McCain, and his fellow anti-conservatives–both those philosophically opposed to small government and those so philosophically unmoored that they have no convictions at all except power–who continue to shape the right-of-center side of America’s political conversation. And that will mean continuing to fight destructive Democrat policies with destructive Democrat-lite policies.

Rejecting McCain, on the other hand, gives us time and space and, most of all, integrity, to recover the principles that made Ronald Reagan the most successful president in modern times, and, in so doing, repair the conservative cause.

Clouthier, on the other hand, took the opposite approach:

John McCain was a terrible candidate for a myriad of reasons I won’t list here. Rather than blogging anything negative, many times, I just held my tongue. (Other times, not so much.) Why? Do I and all conservatives who voted for John McCain lack a spine and principles? Some would say so. Did I hold my nose and vote for John McCain because I’m a conservative sellout?

Which is worse ? Supporting a candidate you know is “terrible” and staying silent about his many, known and obvious, failings ? Or supporting a candidate that clearly stands up for the principles you believe in even though you know he is going to lose ?

Quite honestly, I can’t fathom a scenario where Clouther’s support makes more sense than Carbone’s.

Finally, Clouther seems to think that libertarians are little more than impatient Republicans and that we all just need to sit down, shut up, and take our medicine:

Libertarians don’t help anything by flopping around at the edges and indulging in third party fantasies. Libertarians needs to put their formidable energy into the Republican party at the bottom and take the party back to constitutional greatness.

The biggest mistake that Clouthier makes is assuming that libertarians are, or at least ought to be, naturally Republican. While the Republican platform does lean libertarian when it comes to economic issues, and Republican politicians and pundits tend to use limited government rhetoric that clearly appeals to libertarian ears, the reality of Republican governance over the past decade leaves much to be desired. It was a Republican President and Congress that gave us Medicare Part D, No Child Left Behind, and an unprecedented increase in the surveillance of our daily lives. It was a Republican President and a Republican Congress that allowed government to grow at a rate unseen since the days of LBJ. It was a Republican President, and the Republican leadership in Congress, that gave us the TARP bailout. It was a Republican President who bailed out the auto industry even after Congress had voted against it. It was a Republican President who doubled the national debt over the course of eight years. And, it was a Republican President and Congress that single handed-ly destroyed the credibility of the Republican Party on economic issues.

Given the way that it’s performed over the past decade, there’s no reason to believe that the Republican Party will govern any differently than it has in the past, and no reason for libertarians such as myself to sign on to the Republican agenda.

It’s a story we’ve seen play out before. Obama will, most likely, fall victim to the economic realities that make much of what he wishes to accomplish impossible. Republicans will come back to power. Government will continue to grow. Deficits will rise. Freedom will erode. And, then, when it all goes to pot again, there will be those like Dr. Clouthier telling libertarians that they just need to buck up and be good little Republicans.

Sorry, but I’ve already been burned once and it’s not going to happen again. That’s why, when November 2008 rolled around, I voted for Bob Barr for President. When it comes to lesser offices and future elections, I’ll vote for candidates who actually believe in limited government and free markets regardless of which party they belong to. If neither of the major party candidates fit that bill, I’ll vote for the Libertarian Party candidate, or I won’t vote at all.

The Republicans can have my vote back when, and if, they earn it.

Originally Posted at Below The Beltway

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