hifi

Policy Power Bomb

2009-02-03T12:09:00.002-06:00

Glen Jacobs choke slams Robert Reich in an open letter.

Chinese savings

2009-01-29T13:46:00.005-06:00

This article covers a pretty worthwhile topic, and it deserves better understanding.
The new trend in finger-pointing is to blame the Chinese for saving too much and consuming too little. They are investing so much money in the U.S. that they are driving interest rates lower, which fueled the recent speculative bubbles.

I accept the premise that foreign investment can be a catlyst to speculative bubbles and the subsequent busts. I believe it was Murray Rothbard that argued that the Panic of 1819 was in part caused by an inflow of silver from Mexico. It wasn't the silver per se that caused the panic, it was the fact that the banks were able to print 5x the currency for every ounce of silver they brought in. This increase in the money supply fueled speculation which was corrected in the panic. Again, we can't really blame the Mexican silver, we have to blame the banks that were multiplying the silver by 5 times through credit.

There are two things that contributed to the boom: free coinage, and fractional reserve banking. Free coinage means that the silver was turned into currency. In the case of foreign investment, there is no free coinage. In order to invest in the U.S., you have to trade something for dollars. You can't invest Yuan in the American stock market, you can only invest dollars.

In our case, the Chinese are trading products for dollars. They give WalMart lots of cheap crap, and WalMart gives China billions of dollars. Since the American savings rate has dropped, and consumption of cheap Chinese crap has increased, we could say that Americans are giving the Chinese their savings, and the Chinese are giving us their products. So, from the outset, our relationship with the Chinese should be putting upward pressure on interest rates since we are depleting our savings to consume their products.

From there, the conventional wisdom is that the Chinese are taking those dollars and investing the money in T-bills and AAA-rated bonds. I don't believe either of these activities is inflationary. T-bills are turned into government consumption. So, we have American savings being turned into Chinese products which is transferred to the government for consumption; this may be a drain on private enterprise in America, and it may support the expansion of the government, and the government may have to inflate one day to pay it off, but it's not inflationary today.

What about the money the Chinese put in AAA-rated bonds like those offered by Fannie Mae and Freddie Mac? The fact that the Chinese may have participated in the housing boom, just like everyone else, doesn't mean that they caused or enabled the boom. The cause of the boom would still be the money manipulation that made the run-up in housing prices possible. The fact that the Chinese put their money in a "safe" place that happened to be a GSE engaged in wholesale fraud is not their fault, it's the fault of the Federal Reserve which supported the fraud. The Chinese put their wealth in Fannie Mae, just like a lot of Americans did through their 401K's. The problem was that Fannie Mae was also getting credit created by the Fed to fuel their investments. To say that the Chinese, or 401K's, or greedy investors caused the boom is like saying that Bernie Madoff's investors caused his pyramid scam. Bernie Madoff couldn't have gotten away with it for so long without gullible investors, but ultimately he is the one we should be putting in jail because he was the one running it.

If you want to blame someone for the housing fiasco, blame the Fed. If you want to find fault with the Chinese, you can blame them for outcompeting America. The United States has become bloated with waste and false activities as far as the market is concerned. We over-regulate and over-tax our businesses. Our government is draining our economy with wasteful spending and incredible borrowing to sustain an American lifestyle that is unsupportable. We discourage savings, we jerry-rig our market to allow ourselves to consume more than we produce, and we prop up investment schemes that attract money from all over the world only to implode in on themselves. We support too many lawyers because we have more laws than we need, too many accountants because of more taxes and more regulations than we need, and more investment bankers trying to make money on the great pyramid scam that is the Federal Reserve. America is ripe for the picking. The Chinese easily absorb the production we outsource, and when they've saved enough money, they will be able to purchase the companies that outsourced to them in the first place. When production has left the States, and IT has left the States, and customer service has left the States, it won't be long before middle management, finance, marketing, and eventually ownership all leave the States as well.

Our one saving grace is that the Chinese seem to be putting all their money in T-Bills and AAA-rated bonds. These so-called conservative investments are the biggest false activities of them all. When the U.S. defaults on its debt, the wealth that the Chinese have been accumulating in the States all these years will evaporate and return to Americans. Sucks for them, but it's fitting that anyone that invests in The Leviathan should lose the shirt off their back.

Why I voted for Chuck Baldwin

2009-01-22T11:00:00.003-06:00

Since when have Republicans argued against tax cuts?

Rep. Paul Ryan, the top Republican on the House Budget committee, argued that the main tax provision in the Democrats' plan -- cutting payroll taxes -- was not an effective way to jump-start the economy.

You can also check out some catastrophically bad economic analysis here:

Production of this aircraft is in jeopardy—and with it more than 95,000 American jobs, over $12 billion in national economic activity, and the superiority of America’s Air Force.

Don't get me wrong: I love air superiority. The problem is that our forces are already engaged in two theatres of war where our air force is almost totally useless. Whenever we use it, we turn the populations against us. If I learned anything from "Moment of Truth in Iraq", by Michael Yon, the only effective way to gain the trust of the general populace, and put an end to an insurgency, is to put troops on the ground with the civilian population. Effectively, putting troops in the most dangerous position possible. Air superiority does nothing.

I received the link to the aforementioned website from an e-mail from Townhall.com, a conservative news magazine. Supposedly, we're supposed to spend billions of dollars on fighter jets we don't use because we might go to war with the Chinese (according to the Townhall e-mail, not linked), and because spending this government money is funding "economic activity, including 95,000 American jobs. The fact that we are using 95,000 of our best and brightest and we are spending $12B to produce aircraft we don't use demonstrates what a tremendous drain on our productive resources the government really is.

Could the government employ these people to build schools, roads, and hospitals? Sure. Is that the best use of the money? No. The best use of the money, the people, and the resources would be to send them back into the free market to produce products that consumers are interested in purchasing.

The fact that our economy is struggling should not indicate that we should spend more money on frivolous activities; rather, it should indicate to us that we need all of the resources America has devoted to producing wealth, i.e. producing products that people want and are willing and able to buy. The more resources you devote to profitable activities, the faster the economy will correct itself. The more resources the government forces you to devote to frivolous activities, the longer the economy will stagnate.

Sunshine Patriots

2009-01-13T12:09:00.003-06:00

"These are the times that try men's souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country; but he that stands now, deserves the love and thanks of man and woman. Tyranny, like hell, is not easily conquered; yet we have this consolation with us, that the harder the conflict, the more glorious the triumph."
-Thomas Paine, 1778

I hold a special disgust for those supposed free market patriots that have turned their backs on the free market in favor of government bailouts and stimulus packages. The market crucible has revealed them for what they are: water carriers for the corporate-government complex. I use the term Sunshine Patriot because the free market is synonymous with freedom, and those that protect freedom from tyranny are what we, in America, call patriots. So these so-called free market defenders are nothing more than sunshine patriots, they cave to government tyranny when freedom is most in need of defending. I cannot really say that they are inconsistent. They have consistently promoted the interests of big business and government largess. When they thought the free market supported their employers and their investments, they preached the virtues of the free market. Now that the market has revealed the unsoundness of their investments, they are crying for Big Brother's help.

"If any man builds on this foundation using gold, silver, costly stones, wood, hay or straw, his work will be shown for what it is, because the Day will bring it to light. It will be revealed with fire, and the fire will test the quality of each man's work."
-1 Corinthians 3:12-13

The free market is in the process of consuming the wood, hay, and straw that we have built our economy on in order to expose the foundation that has remained unshaken. This is a necessary and beneficial process that must be completed before we can begin to build our economy again.

Let me break this down for you again, so that no one can claim that I didn't make my voice heard.

We are in this mess because have leveraged our current consumption against our future productivity. We have spent everything we had saved. When we ran out of savings, we borrowed from others in order to spend. When the nation ran out of savings, we borrowed from the Chinese and spent. When the Chinese ran out of savings, we printed money and spent. Had the free market been functioning properly, we would have been forced to stop consuming and borrowing against our future productivity when the national savings dwindled and interest rates sky-rocketed. But interest rates never sky-rocketed because our banks were able to create more savings out of thin air by lending out $9 for every $1 they kept in the vault. Once the banks were leveraged as far as they could be, they started selling their mortgages to Fannie Mae and Freddie Mac in order to lend even more.

Housing prices sky-rocketed on rampant speculation made possible through credit expansion. Americans ran up credit card debt, and went on installment plans to buy washer/dryer combos and granite countertops. Businesses expanded to keep up with the ever increasing demand.

Like a dry California forest in the hot summer sun, our economy was ready to burst into flames from the tiniest of sparks. Then it happened. Our debt finally caught up with us. Those that had leveraged their future on the hopes that their home values or their salaries would increase were stuck with interest payments they couldn't afford.

Market reality is sweeping across this nation like a wildfire, consuming the paper fortunes that Americans had amassed around them.

The market wildfire is consuming the waste, the unproductive industries, and the false activities.

Housing prices have inflated at a much faster pace than income to the point that affordable housing has all but disappeared. Unsold overpriced homes cover the country. The market is forcing down these prices so that Americans can once again afford to own a home.

Consumers have maxed out their credit cards and exhausted their savings buying washer/dryers on installment plans. The market is forcing companies that produce products that depend on long-term financing out of business. Only the companies that produce the best products at the best values stand a chance of staying in business because Americans can no longer afford to leverage their current consumption against their future productivity. The market is working by preventing America from producing or importing any more products that we can't afford.

Banks have committed fraud by loaning money they don't really have. Investment bankers have amassed paper fortunes by pushing around stocks and bonds and using credit to run up prices, only to find their fortunes consumed in the market fire. Lawyers charge hundreds of dollars per hour to help businesses navigate through miles of government red tape. Accountants are paid premiums to find tax shelters and make sure companies are abiding by the latest bureaucratic requirements. These are all wasteful, false, and fraudulent activities that add no value to our economy but consume billions of dollars worth of productivity. The market is already in the process of exposing and consuming the waste.

How long have we complained about unaffordable housing? How long have we complained about irresponsible borrowing, bankruptcies, and America's overconsumption compared to the rest of the world? How long have we complained that America has become a nation of lawyers, accountants, and bankers that add no real value to the global economy, and all of the productive manufacturing jobs have fled the country?

The market is answering our complaints.

Should we be afraid? Yes. But not of the market. We should be afraid that the U.S. Government has so overleveraged itself that it finds itself in an inflation trap: it can't allow the dollar to strengthen and the economy to deflate, because it won't be able to pay of the debt of today using the less valuable dollars of tomorrow, and it will default on its debt, which will create a tsuname which will obliterate the world's economy; but it can't devalue the dollar any further through inflation, because it risks the hyperinflation which would result. We should also be afraid that the U.S. economy has become one massive false activity, pushing global currencies and equities around and calling it productivity and profit. Ultimately, the free market demands that every person must produce if they expect to consume; if the U.S. economy continues to make a living in the largely fraudulent financial sector, the market may very well expose the entire economy as one massive false activity and liquidate it entirely.

How can we avoid such a terrible fate? Let the market do it's work. Inventory surpluses must be liquidated. Housing prices must come down. Washer & dryers must be sold at a discount. Labor prices must drop. The American auto industry, which stopped making money on cars and started making money on financing some time ago, can no longer exist in its present form. We must pay off our debt, and increase our savings. Our productive resources must be reallocated into the industries that are producing valuable products and services that the world desires and can afford. Will our standard of living decrease? Of course! As it should! Or previous standard of living was based on borrowing against our future. That kind of living can't be prolonged indefinitely. Jobs will be lost in some sectors, but they will be replaced by new ones in profitable industries. Wages will certainly fall, but so will the cost of living. America is the wealthiest nation in the world, not just in dollar terms, but in terms of intelligence and natural resources. We can put those resources to use, but their prices must drop until the market can afford to use them. The market will make room in the other industries, primarily those that sell necessities and certain luxuries that don't depend entirely on long-term financing to make money. The waste, the fraud, the false activities, and the products we can't afford will be liquidated.

The alternative is tyranny and misery.

We can raise unemployment compensation and the minimum wage, but that will only result in higher unemployment rates, reducing productivity and consumption, cutting off a massive swathe of the population from the workforce, and draining the rest of the economy. We can tax & spend a trillion dollars improving infrastructure, but this will only drain capital and jobs from those industries that are viable and profitable. We can print the money, but that will only steal value from the nations savings, this is just more shuffling of capital and resources towards wasteful unproductive enterprises. We can borrow the money, but that will again only siphon present capital from the private sector and future capital from the taxpayers.

We cannot borrow our way out of this, we are already overleveraged. We cannot steal from profitable industries to keep the wasteful industries afloat, that will only prolong the recession and most likely turn it into a depression. We cannot consume our way out of this. We have already produced and consumed all the H3's and double ovens we can afford.

The only way out of this is to allow the market to reallocate our productive resources into the profitable and productive industries that the nation still desires and can afford to consume.

The Flat. Tax

2009-01-08T09:14:00.003-06:00

The EPA has floated a proposal to tax cattle and pigs in an effort to ostensibly limit green house gases. Hugh Hewitt called this the Flat. Tax on his radio show (Flat. being an abbreviation for flatulent, pronounced flatch). For years conservatives have been trying to stress how small man's contribution of greenhouse gases is in comparison to the natural world, and they have often used cow flatulence as an example of just one of the many natural contributions that makes man's effect pale in comparison. Maybe some of these conservatives are wishing they had not opened their mouth. What would have been a tongue-in-cheek remark a year ago, "What are you going to do, put a tax on cow flatulence?" has now become a potential reality.

America has become a parody of itself.

What I find interesting is that the EPA has decided to kill all the cows, but has not offered any recommendations for draining the Florida wetlands. Wetlands produce more methane than cattle, and wetlands aren't a source of food or a significant business concern. But this isn't really a war against greenhouse gas emmission, it's a war against capitalism and the enemies of environmentalism. There are myriad reasons why greens would attack the cattle industry that have nothing to do with global warming, whereas the wetlands hold a near and dear place in the hearts of all good environmentalists.

I'm not saying we SHOULD drain the wetlands, I'm just saying that the global warming propogandists are not really interested in stopping global warming, they are using global warming as leverage for the broader agenda. We could put the whole nation on nuclear energy in a generation and stop the production of greenhouse gases related to electrical energy production in a generation, but this would not advance the broader environmental agenda, so it is not considered viable.

What makes me irate, however, is that while there is not really a consensus when it comes to global warming and how it is caused, there certainly is a consensus concerning what can be done to stop it: nothing. Unless, of course, you're willing to consider the eradication of the human race a viable option. The Kyoto Protocol, as damaging as it will be to the world economy, could only produce a statistically insignificant change in the earth's temperature, indistinguishable from statistical noise. Yet we are willing to cause widespread human suffering for this statistical noise.

I can only hope that God will step in again and confuse our speech, thus preventing us from completing this tower of human pride.

Where does the money come from?

2009-01-06T09:22:00.002-06:00

Gary North really knows how to bring a brother down.

"The 401(k) programs are also Ponzi schemes. They depend, not on economic growth to provide wealth, but rather new investors in the stock market. Earnings are insufficient to provide the income required to provide a comfortable retirement. After deducting fund expenses, until 2008, earnings were zero or close to it. The dream of easy retirement always rested on the sale of shares to newcomers. This is Ponzi scheme financing."

Talking heads and radio ads like to tell you how well the stock market has performed in the last x decades, and assure us that this performance will continue indefinitely. We are not supposed to think about where the money comes from. But where does it come from?

Imagine a closed economy with a hard currency and 100% reserve banking. The only money that is available to stock-brokers is the money that they are given by investers. There is only so much money in the economy, and of that money, only so much of it is saved or invested. It should be generally true then that there is only so much money in the stock market, and in order for one share to increase there must be some sort of equal and opposite reaction to allow for it. The most likely answers would be: a) that some share was sold, thus lowering the value so that some other share could be purchased, thus raising the value, or b) consumption decreased in order to allow for the increased savings/investment. Of course, we don't live in a closed economy, we don't have a hard currency, and our banks only hold 10% reserves. In that case, we have a few more options: a) the money needed to purchase the additional share could be the result of printing new money (ie inflation), thus lowering the value of the dollar, or b) the money could have been lended to the investor by a bank, which is generally the same thing as inflation, or c) the money could have come from overseas, thus increasing the wealth of the U.S. at the expense of some other nation.

Now, there's also the question of the velocity of money through the economy, but I would wager that this applies more to consumption than to savings/investment. The dollar you have in your pocket may change hands hundreds of times in a year. The more the dollar changes hands, the higher our consumption, and the higher prices could hypothetically go. But monetary velocity applies more to consumption than to savings/investment. And like all things in the economy, it has a natural tendency to find an equilibrium. Monetary velocity can't increase multiplicatively indefinitely in order to generate returns.

So what does all this mean? The diversified buy-and-hold strategy that depends on increasing share values doesn't really make sense. It shouldn't be anything more than protection against inflation, which can only be caused by increased fractional lending or money printing. Theoretically, the only way to make money in the stock market would be to pick stocks that are growing at the expense of mature or shrinking stocks, or to put money into companies that pay dividends, which is a way of getting your hands on the monetary velocity of the consumption sector of the economy.

If Gary North is right, then those of us that have 401K's or investments in general need to be much more aware of the business cycle. It will be generally true that the stock market will expand due to money-printing and credit expansion, only to contract such that share values return to their original values + inflation. Money can still be made in the stock market. But it's important not to be fooled into believing that share values will increase at the same rate indefinitely. You have to know when to get in and when to get out.

That's What I'm Talking About

2008-12-30T10:40:00.002-06:00

Mike Rozeff wrote an article that articulated exactly the point I made here. Rozeff one-ups me by describing how the process inevitably progresses. Government funding leads to widespread fraud. This is an inevitable part of the human experience. We are all fallen. We are all prone to all sorts of evil. If someone puts $100 on a park bench with a note that says, "Take this $100 only if you REALLY need it, and use it for what you need," do you think that $100 will be taken by someone truly impoverished? If so, do you think it will be used for food or shelter? Of course not.

I said in a previous post that Economics is the study of how man copes with the fall. Life is tough, and work is hard. We toil against the soil which resists us, so we take advantage of every possible advantage. We do not, by nature, take the righteous path over the path of least resistance. So, if the government puts money towards some program, or some industry, without any controls, it will fall victim to fraud and waste. People, being people, will take advantage of the lack of controls, and use the money for their own personal gain. Once the fraud and waste is discovered, the government will have 2 options in order to correct the problem: withdraw the money, or increase the control mechanisms. In my opinion, it is much more likely that government will increase the control mechanisms. Depending on the extent of the controls, and the relationship between the government and the industry, the result will either be fascism (public private partnerships) or socialism (full public control).

Controls are not a bad thing. The question is, who determines them? Free people making free decisions, or the government? The question should be rhetorical. The free market is far and away a better system of controls. It is more ethical and it serves the desires of the people more efficiently. Government control is funded through extortion and, being made up of fallen people, is predisposed to service itself and special interests, any attempts to service the desires of the people come after the desires of the bureaucrats and the politically connected.

Freedom isn't Free

2008-12-26T10:41:00.002-06:00

That some so-called conservatives are now backing away from the free market because it doesn't seem to be working right now is not a blemish on the free market, it is the result of a trial by fire which has brought to the surface the lack of character of those that espouse the free market when their portfolios are rising.

For the record: the free market doesn't fail.

That's like saying love failed, or freedom failed, or justice failed.

Is the free market perfect?

Define perfect.

Freedom is it's own goal. Freedom is not a means to an end. The objective of the free market is not to make people wealthy. The objective of the free market is not to grow the economy. The objective of the free market is not to improve people's standards of living.

The purpose of the free market is to be free.

There are, of course, indirect costs and benefits to freedom. The benefits are numerous and obvious. Freedom is the surest path towards the greatest prosperity.

Those that believe that the free market failed are suffering from their own failure to understand the merits of freedom and the reality of the world in which we live.

The reality is that we are not even living in a free market. I grant that freedom will produce casualties, just like any other tactic used by man to cope with the fall (the study of which I like to call economics). Freedom does not undo the damage caused by the fruit of the tree of knowledge of good and evil. However, I will not accept the premise that America is a free market.

Society in America is heavily regulated. Freedom is fenced in on all sides. We are free to do, to produce, and to purchase whatever we wish, so long as we abide by certain rules and regulations. Many of these rules and regulations are forms of social engineering and socialism meant to try to fix the problems with the free market.

The attempts to create an ownership society, an attempt to undo the fall rather than cope with it, have instead produced an impoverished society. The attempts to artificially stimulate growth have produced a recession.

The free market continued to operate to some extent, within it's neat little framework. It did exactly as it would be expected to do, and it met it's objective of being as free as it can within the constraints.

It is the meddlers who failed. It was their goal to rig the system to produce a society that is safer, wealthier, more equal, and more prosperous. It is they who have failed, and the reasons are obvious. The world is too complex a place to be governed by bureaucrats. It is only free people living in a free society that can cope with the complexities and the difficulties that have resulted from the fall.

Is it perfect? Again, I ask you to define perfect? If you are unable, then I will give you my definition. Perfect freedom will occur when all people make perfectly free choices with perfect knowledge that do not infringe upon the freedoms of others. When this perfect freedom is combined with perfect justice, perfect mercy, and perfect love, you will have a perfect society.

If this is the perfection you seek, then you will only find it in the Kingdom of God.

Supply & Demand

2008-12-22T09:54:00.002-06:00

The last time I checked, resources were still finite, and human desire is still insatiable. Since that is the case, for what reason do we believe that the market will be unable to reallocate the liquidated assets of the Big 3 U.S. automakers?

The Big 3 is going bankrupt, but people still want to buy cars, and we still have the resources to build cars. The problem we have today is that the Big 3 are spending too much money to build cars that people either don't want or aren't willing to pay for given the alternatives. This is not an "end of the world" kind of problem like if we just sucked the last drop of oil out of the earth. This is about allocating our vast resources to properly satisfy our seemingly infinite demand for stuff. The real danger here is not what will happen if the Big 3 goes under, the real danger is the fact that the Big 3 is wasting our precious finite resources, and bailing them out will only prolong the waste.

As long as people still want things that they don't have there will always be something productive for people to do. If the Big 3 are wasting our time, talents, and resources building cars that don't serve the wants of the people, then it is appropriate that they be liquidated so that the labor, talents, skills, and resources can be put to use making things that people want more.

The only thing that stands in the way is government bailouts and unemployment benefits. The market will always reallocate resources to put them to productive use, but the market is hamstrung when the government prints money to pay people to stay home. This printed money is worthless, but since we all use it, every dollar they print to keep the Big 3 in business or pay for workers to stay home steals wealth from every other dollar in the economy. So our savings is worth less and less in terms of real goods that can be purchased with it and all we get in return are crappy cars that nobody wants.

Failure puts downward pressure on prices (making our savings worth more and more), which makes purchasing the liquidated assets in order to put them to more productive use cheaper and cheaper. Propping up failing enterprises makes recovery more expensive and it eats away at our savings, therefore making recovery twice as difficult. Allowing these enterprises to go under makes the recovery process cheaper and it strengthens existing savings, therefore making recovery twice as easy.

Juries

2008-12-18T09:59:00.004-06:00

Let's say you get called for jury duty. Let's also say that the accused was arrested for evangelising in a public place without a license. A law was recently passed which restricted proselytizing on public property without a permit, and the accused was found to be handing out fliers and asking people if they wished to take spiritual surveys.

You are shocked to learn that such a law even existed and believe that it is terribly unfair and is in direct contradiction with the 1st Amendment, but when it is your turn to be interviewed, the judge asks you the following question, "If it is demonstrated that the accused was indeed handing out fliers of a religious nature and asking people to take surveys, also of a religious nature, and that the accused was doing so without a permit as required by law, would you be prepared to render a guilty verdict and sentence the man to the minimum 12 months in prison?" What would you say? What would you be thinking?

Let's say that you answer, "Yes, I would be willing to render a guilty verdict," and you are put on the jury. During the trial you are instructed by the judge that your job is to render a verdict on the facts only, that it is your job to determine whether or not the accused was evangelising, and whether or not he was doing so without a permit, and that it is not your job to determine whether the law is just or fair, it is only to determine whether the law as it is written was broken.

Based on the witnesses and the writing of the law it is clear that the accused was in direct violation of the law against evangelising. What would you do? Would you follow the judges direction? After all, you were specifically instructed that your only role in this matter is to determine the facts, and the facts are obvious: the law is written plainly, and the accused was clearly in violation of the law. Would you return a guilty verdict?

The case I just described is pretty similar to a the case brought against William Penn for preaching a Quaker sermon before an assembly in the street. The judge in the case attempted to force the jury to render a guilty verdict without even hearing the defense. When the jury refused, they were sequestered several nights in jail cells where they were told to rethink their verdict. The jury stood firm, and refused to render a guilty verdict even though the law was clear, and William Penn had plainly and openly violated the law.

This process is called jury nullification, and it's built into the jury system, although most jurors don't realize it. Since the judge cannot force a juror to render a particular verdict, and cannot punish a juror for how the verdict was determined, a juror is able to render a verdict of "not guilty" for pretty much any reason they find acceptable.

Aside from William Penn's case, jury nullification was also commonly used to nullify the Fugitive Slave Act. Enough Northerners thought the law was an abomination that it was very difficult to get a conviction. There were enough citizens of conscience that even when slaves were caught, and those harboring them were brought before the court, the juries would not convict them.

Unfortunately, jury nullification has fallen out of favor in the U.S. Juries are selected based on whether they will apply the law as it is written, regardless of whether they agree with it or not, jurors discovered to be intent on practicing their power of nullification are often removed, and defense attorneys are often prevented from informing juries of their nullification powers or imploring them to exercise their power.

It had never occurred to me that jurors had this ability. I had always operated under the assumption that juries "have" to render a verdict based on the facts, and it is up to the judges to determine whether the law is just or not. But the reality is that the courts cannot force the juries to abide by any particular instruction, and once a "not guilty" verdict has been rendered the question cannot be raised again. So juries certainly have the power, although many judges may attempt to remove those jurors intent on exercising that power.

I would also argue that jurors have the right to exercise their power of nullification, that they have the moral obligation to do so when the law is repugnant, and that a jury cannot be considered "impartial" if it is screened for jurors that may not agree with the law in question.

What's the Fed to do?

2008-12-17T09:57:00.003-06:00

The Fed has cut rates to .25%. About as close to zero as you can get. If this doesn't work, the Fed won't have too many more cards to play, outside of coordinating printing money with the Treasury. The Japanese had a similar problem in the 80's and 90's. They dropped rates to 0%, but it didn't work, and then they found that there was nothing else they could do to try to stimulate growth. None of the bureaucrats clever schemes were able to lift Japan out of their economic malaise. Why do we think it will work here?

Once again, the problem is that we are malinvested. We have put too much money into enterprises that are not profitable, and the entire economy is overextended in terms of debt. Putting ourselves deeper into debt is not going to help. Destroying the U.S. Dollar is not going to help either.

The Fed is in a bind because they are pumping as much money into the economy as they possibly can in order to get banks to start lending again, but if the banks start lending again, the multiplicative effect of the reserve system will cause hyperinflation. Doesn't make sense? Here's the long explanation. Banks typically only hold 1 dollar for every 10 they lend. This is called the reserve requirement. In good times, banks extend themselves to the limit because they are experiencing good returns on their money. When things turn south, banks contract, they hold more in reserves in order to prevent failure. This is why oil has come down and the dollar has strengthened, even though the treasury has committed to flooding the market with trillions of dollars and the Fed rate is near zero. Analysts are perplexed, because they can't understand how printing money can result in a stronger dollar. The answer lies in the banking system. Banks are lending less, which shrinks the money supply.

So, what happens when things start to turn around, and banks start lending again? BOOM! When banks multiply the amount of money in the economy by a factor of 10, economic activity will explode, but so will prices. This may be great for hedge fund managers in the short-term, but ultimately a much worse recession will follow because the marginal increase in activity is not supportable or desirable because ultimately when people try to retrieve the money in their banks in order to pay for all these new goods and services, they will find that their money isn't there.

Remember, the stated goal all along has been to get housing prices back up, right? The market has already determined that running up the price of housing was a huge mistake, and 2 bedroom condo's are not really worth a $200,000. Rather than allowing the housing market to return to some sane level that will actually allow renters to purchase a home, the powers that be are making great efforts to try to help speculaters and home-owners make a killing on their homes. For some reason our elected officials think that it is good if home values double every 5 years and completely ignore the massive portion of the population that will not be able to afford these inflated prices. Somehow they are able to wring their hands about making houses affordable for the less fortunate and get away with it, which is beyond me.

The real solution is as plain as the nose on your face. Reduce the government's meddlesome influence on our economy. Fix reserve requirements at 100% and return honesty and integrity to the financial system. There is no other solution. Throwing paper at the problem will not work. It defies logic to believe that printing little green slips of paper is going to resurrect our economy.

Bailouts lead to socialism

2008-12-15T09:27:00.002-06:00

I liked this article, I especially liked the graphic.

Here's one of the often overlooked problems with socialism: there is no diversity. When citizens are expected to save for their own retirement, some make good decisions, and some make bad decisions. When bureaucrats decide that the government should take the citizens money and save it for them, there is no diversity. If the government is responsible, everyone wins. If the government squanders the money, everyone loses. Since the government is not known for being responsible, it should not be surprising that everyone will most likely lose.

Here's a hypothetical. Let's say the government has socialized health care. The bureaucrats realize they are spending lots of money on treatment for breast cancer. Being smart bureaucrats, they know that early detection is the best way to fight breast cancer, so they mandate that every woman over 35 must get a mammogram every year. That way they will be able to catch breast cancer early, and treatments will be less expensive. So, every woman in the U.S. over 35 gets a mammogram every year, and the breast cancer rate surges. What happened? Well, some researchers are now linking mammograms to breast cancer. Since there is no diversity, the wrong decisions of the bureaucrats negatively impact everyone.

It is also inevitable that the government will be more intrusive when it is more financially invested in our lives. If the government is paying for insulin for diabetics they will try to stop people from drinking soda and eating fast food. Some bureaucrats may try a patriarchal approach to nudge you in the right direction, and others may try heavy handed approaches. But it is an unavoidable reality that the more the government controls, the more financially invested they are in our decisions, the more the government will want to control or limit our decision-making. They might want to control our decisions to reduce costs, to save the environment, to help the poor, or to get into better shape. Almost all of it will have good intentions, but if the ends do not justify the means, then certainly the pursuit of the ends shouldn't justify the means either.

Corruption

2008-12-10T09:20:00.003-06:00

The Governor of Illinois, Rod R. Blagojevich, was recently arrested. The most brazen and craven amongst the Governor's alleged acts of avarice were as follows:

-He attempted to stop the flow of funds to Children's Memorial Hospital because he did not receive a contribution of $50,000 to his campaign fund from the CEO of CMH.

-The Tribune Company has been trying to sell the Chicago Cubs, but Wrigley Field is in poor shape and would need to be renovated, which is slowing down the sale because it's a considerable financial obligation and renovation is really the only option that Cub fans will accept; replacement is not an option. The Tribune Co. approached the state in an attempt to sell the stadium, and Blagojevich used that potential purchase as leverage to try to get several editorialists that were outspoken in their criticism of the governor fired.

-Governor Blagojevich has the sole responsbility for finding a replacement for President Elect Barak Obama's vacated Senate seat. This has been the number one news item in Illinois for the past several weeks, and according to prosecutors, Gov. Blagojevich was trying to auction off the Senate seat to the highest bidder behind the scenes.

The big question on everyone's lips and minds the last few days has been: how can we stop corruption? When will it end? What can we do? What is the solution?

To be perfectly honest, the solution is obvious, but very few people are really willing to address the issue at the core. Most pundits and editorialists are talking about ousting the entrenched and corrupt politicians that always seem to be at the root of scandals. Some are talking about oversight. Others are talking about campaign finance reform. While these are all reasonable ideas, they are all superficial attempts to fight the symptoms of a much larger problem: the government has too much power.

The whole premise behind government corruption is that the power and the authority of the government is being bought at a price by special interests, the powerful, and the privileged. Reduce the government's ability to reward friends and penalize enemies and corruption will diminish.

The problem with Blagojevich and the rest of the stinking cesspool of Illinois politics is that our leaders are willing to put their power on the auction block and sell it to the highest bidder. Instead of trying to stop the auction, we should focus on taking away their power. The less power that politicians have, the less they will be able to sell it. Any other "solutions" will be vain attempts like trying to keep water from flowing downhill.

The Culture War - Illegal Immigration

2008-11-21T13:52:00.003-06:00

If you read my first two parts on the culture war, then I you probably know exactly what I'm about to write. You probably know so well that you could write the article yourself.

After "the economy", and "the war on terror", illegal immigration is often cited as the most important issue on voters minds. As always, there are various groups that are interested in this issue for different reasons, they have different concerns, different solutions, or different reasons for the same solutions.

There are basically two issues being debated. How "open" should our borders be? What should we do with people that broke the law to get here?

I include this to the list of issues related to the "culture war" because many believe that American culture and traditions are at stake. Many claim that those that are immigrating here are not learning our language or our customs and are forcing American culture to adjust to their presence.

Again, I believe this divisive issue is further aggravated by the government's role in our culture.

If you are vehemently opposed to illegal immigration, let me ask you this: How would you feel about illegal immigration if every person who came here illegally were barred from sending their kids to public schools, and had to pay out of pocket for their health expenses?

The reason that so many people harbor such animosity towards illegal immigrants is because they are taking advantage of all sorts of government services and benefits that the American Taxpayer is paying for. I also believe that this is one of the reasons America (and other Western countries) are so attractive to people from emerging economies. Not only are there jobs in America, there are also free schools and free health services.

It's not surprising that this creates hostility. American workers are taxed to pay for schools, roads, hospitals, medicare, the military, and everything else. They can't afford to charge lower labor rates because they have to pay for America's government infrastructure. Illegal immigrants can afford to charge less because they are often times avoiding these additional costs. So, it should not be surprising that Americans can be found to be upset that not only are they paying for services for illegal immigrants, they are also losing their jobs to them because illegal immigrants can undercut their prices.

The "problem", however, is not the immigrants that are searching for a better life. The problem is that we have made a number of resources "public goods", and this has resulted in over-consumption. Not only is the American taxpayer over-consuming, we are also attracting outsiders to the feeding trough.

The problem is free-riding, and it's not a cultural problem, it's an economic problem. The solution is to get rid of all government services as well as income taxes. Then all workers will be competing on an equal playing field. It is unlikely that those that don't want to learn the language or assimilate into the culture will find many opportunities here, because their competitive advantage (lower labor prices) will have evaporated. Those that still wish to come here and succeed will not be met with the same resentment because they will not be viewed as free-riders.

Is this solution palatable to American culture? Of course not, but it's still valuable to know what the real problem is, who is at fault, and what the real solution is. Once again, the problem relates to market distortions caused by the government which have resulted in cultural conflicts, and the solution is removing the governments influence.

Culture War - the Marriage Debate

2008-11-18T16:47:00.008-06:00

It is undeniable that a national dialogue (I hate that word so much) is taking place concerning the definition of marriage. Of course, I shouldn't really call it a dialogue, because there isn't really much dialogue going on. There is a lot of monologuing. There is a lot of yelling. There is a lot of spending (like $70+ million trying to pass / defeat proposition 8 in California).

Why is this? Why are we committing such tremendous resources on both sides of this issue? Those on the left may say that they are fighting for a homosexuals right to marry the person they love. Those on the right may say they are fighting to protect the traditional definition of marriage. They are both lying.

There are thousands of churches around the country that would be happy to perform a marriage ceremony for a homosexual couple. There are no protests outside these churches (at least not that make the news). Homosexuals are not blocked from the marriage ceremony, and those that are supposedly opposing "same-sex marriage" make no effort to try to stop them. The battle is not over the culture. There are sub-cultures on both sides of this divisive issue that co-exist in peace. While there are always those that would wish to blot all other sub-cultures from the face of the earth, the reality is that we get along fairly well.

If not for the government.

The battle is not so much over the culture as it is over control of the state's power apparatus. Changing the state's position on this issue will have major repercussions throughout the culture.

There are two valid claims in this debate. There are those that want a same-sex relationship to have the same recognition, rights, responsibilities, and benefits as a traditional relationship. There argument is that they are forced to support an legal institution that they have no access to. Then there are those that do not want to recognize same-sex marriage because of the potential impact that will have on the rest of the governments involvement in culture. For instance, a Catholic charity operating in New England was forced to close its doors because they refused to offer their adoption services to same-sex partners. Legal recognition of marriage is viewed by many to be a stepping stone towards enacting and enforcing anti-discrimination laws that would prevent a massive portion of our society from living and acting according to their values and religious beliefs.

The problem here is that since the government has taken it upon itself to provide countless benefits and services, and through regulation is constantly involved in social engineering, the idea of protecting "Civil Rights" has become a zero-sum equation that usually involves giving one person a "right" to some service or benefit, by taking away another person's right to their property. We no longer consider rights something that need to be protected; rather, we use the term to also refer to various privileges that we believe are important. It is one thing to protect a man's cupboard from being emptied in a robbery, it is another thing entirely to fill his cupboard by robbing someone else's.

So, if we take a classic view of our civil rights, what can we conclude regarding same-sex marriage? Regarding the protections that marriage offers, I see no reason why any person, whether they desire to enter into a same-sex marriage or a traditional marriage, should be denied the legal protections that a contract allows. If two people want to establish co-ownership of their property, they should be free to do so. If two people want to establish co-guardianship over any children, be they biological or adopted, they should be free to do so. If two people want to will their possessions to the other and establish one another as executors of their estates with power of attorney and the power to make decisions in the case of one of the people being put on life-support, then they should be free to do that. I see no reason why this contract should have a different name for homosexuals than it does for heterosexuals. However, when it comes to benefits, the government really has no right to establish benefits for those that are married, be they heterosexual or homosexual, to be paid for by those that are not. The government also has no right to force businesses, churches, or private organizations to treat married or unmarried people a certain way, whether they be homosexual or heterosexual. That means that no business or health insurance provider should be forced to offer benefits to people based entirely on their relationship, legal or otherwise, to the customer/employee. If you want to buy health insurance for a spouse, a child, a sibling, a friend, or a stranger, you should be entitled to do so, but you should not be entitled to receive some kind of discount.

Once again, we see that the problem is not that the culture is at war. The problem is that the government is actively involved in robbing and oppressing us, and that we are all pitted one against the other to determine who is the one that is robbed and who is the one that receives the spoils, who is the one that is oppressed and who is the oppressor. We are all faced with a decision: either we allow ourselves to be oppressed, or we fight to become an oppressor. Unfortunately, it seems that the government knows no other way.

Culture War

2008-11-18T10:28:00.003-06:00

I have come to the conclusion that the culture war exists because of the government. You can add this to the already lengthy list of things I blame on the government.

The reality is, however, that it's not for malicious reasons that the government is provoking the culture war. In most cases the government is just trying to do what they can to make life a little bit better in the U.S. In this case, the voting public has decided that it is in the so-called public interest for everyone to receive an education up to age 16. Certainly, everyone would agree that education is a good thing, and a well-educated society will be better in many respects, although I do not agree with the education ideologues that believe that through proper education we will somehow be able to cleanse the world of all it's woes. The problem is that the voting public left it up to the government to do the educating. This is, of course, the natural course of things. The government is naturally predisposed to assume more and more control. After all, if they are paying for it, certainly the government should have a say in what the curriculum is, what standards are used, etc., etc. Ultimately, the government assumes complete control of any system it is expected to subsidize, which is why I am generally opposed to government subsidies of all the things I like. This is where the culture war begins. What curriculum will the government teach that will please all the parents? What will the discipline standards be? What will be the methods?

While the free market can be extraordinarily flexible in meeting the demands of parents, primarily by creating more schools that cater to specific demographics. The government seems pre-disposed to provide a one-size-fits-all solution with only subtle deviations. Add to this the inflexibility which results from various court cases, referendums, and certain interpretations of the constitution, and you have an extraordinarily rigid structure that can only be controlled from the top down. So, if a parent is displeased with the curriculum, or the discipline standards, they hire the ACLU or the ADF (depending on your cultural and political background) to represent them in a court battle to change the entire national public school system. Does that seem a little heavy-handed? I think so, too. But what other choice does the parent have? Talk to the school board, they will probably tell them that they are legally obliged to follow xyz federal requirements, and they are helpless to assist the parent. So, while the parent has other options (like move, send the kid to a private school, or homeschool), the only way to change the school that your child is already attending in any meaningful way is to change the whole system.

It is because the government runs the schools that we have such heated debates over whether or not prayer should be allowed, or any mention of God, or sex education classes, or courses on global warming, or evolution. The reality is, that many people are engaged in the so-called culture war because they do not feel like they have the option to send their kid someplace else.

Of course, there are others that simply don't like the current state of things. These people are always determined to ramrod (this is one of my favorite words, an oldie but a goodie) their beliefs down everyone's throat regardless how the anyone else feels about it. These people exist on the left and the right in seemingly equal proportions. While these little tyrants and fascists are certainly a problem, the surest way to strike a death blow against them is to remove the apparatus they most often use against the cause of liberty: the government.

Republicans should move left? Or is it right?

2008-11-11T13:00:00.002-06:00

Here were my promises from the previous post:

"Next post I'll talk about why the GOP should return to some of its Goldwater roots. I'll also explain why I think this will win some independents, some Democrats, and how this will resonate, in some respects, with many evangelicals. I will also explain how the GOP can spin this to the evangelical base in order to retain it, and why the evangelical base should embrace the move as more in keeping with their commissions as followers of Christ."

Wow. Did I promise all that. Alright, here goes:

By "Goldwater Roots", I mean small unintrusive government. In a nutshell: libertarianism. Every conservative would rally behind a Republican candidate that really supported fiscal discipline (lower taxes and less spending), so I'm not going to go into that. The question is, how would the country respond to a GOP that moved left (or is it right?) on social issues? Especially since this has been the GOP's bread and butter as of late.

When it comes to the culture war, I believe that conservatives are primarily motivated by one thing: they want to be left to live as they see fit and raise their children as they see fit. If, however, the government is intent on running their lives and raising their children, then it darn well better do it the same way they would. For example, If parents can't afford to send their children to Christian schools because they are already paying thousands of dollars a year to fund the sub-par public school, then that public school better be teaching them in a way that is consistent with their beliefs.

I believe that conservatives are proponents of "either/or" when it comes to politics. "Either you let me live my life as I see fit, or you bend the system to suit my preferences". Since the government is determined to provide a one-size-fits-all government sponsored solution to all of life's problems, then conservatives will always be forced to fight so that "one-size" fits their beliefs.

The GOP ought to be the party that seeks to empower the individual. While I do not think that the GOP should change it's positioning on the issue of abortion (since this would still be considered an issue of personal freedom on behalf of the unborn), there are a number of issues where the GOP is unnecessarily cornering itself: homosexual marriage, pornography, drug use, flag burning, prostitution, public school curriculum, and capital punishment. I believe that a lot of conservatives would be willing to concede on some of these issues if the government reduced its role in the lives of Americans and made them free and responsible unto themselves. In this way I do not believe that the GOP would necessarily lose its base, so long as it aggressively pursued the cause of freedom and reduced the size and scope of government interference.

I think it is obvious that the GOP would also pick up more self-described libertarians that currently call themselves independents or Democrats.

On to the last point: evangelical Christians. I believe that more evangelicals ought to be putting their hope and faith in Christ and the church, and not in the United States Government. The only tool the US Government has at it's disposal is the sword. It's revenues are supplied through extortion. It's laws are carried out through violence. If it is unacceptable for the church to pursue it's ends through violence and extortion, why is it deemed acceptable to outsource it to the government. If the church cannot convince enough congregants to donate to a food drive, and it is not acceptable to hire goons to break kneecaps in order to cover the shortfall, why would it be acceptable for Christians to support the U.S. Government to do the same? It would be universally condemned if Presbyterians tried to restrain Episcopals from blessing same-sex marriages, so why is it acceptable to try to restrain a judge from issuing a civil union? Isn't a marriage proclaimed in God's name more important than a marriage proclaimed in the name of the state? The duty, as I see it, of the church, is to offer the Kingdom of God as a spiritual alternative to the present authorities of this world, not to ramrod our beliefs down the throats of the public using the present authorities.

Obviously, I'm not able to explain a position on every contentious issue in America's culture war with a couple of rhetorical questions. Each would require a post in and of itself. However, I will say that as Christians I believe we should pursue the course of freedom whenever and wherever possible lest we give the state the very power which they one day use to restrain us. It would be better, in my opinion, to champion the cause of freedom, to uphold the virtues of Christ, and lose the culture war than it would be to win the culture war using the sword of the state. The sword of the state ought to be reserved for administering justice, for protecting freedom and property, for preventing harm, and for punishing those that have harmed others. To put it simply, the state ought to enforce the negative aspect of the Golden Rule: "Do not do unto others as you would not have them do unto you". The role of the church is to carry out the positive aspect of the Golden Rule ("Do unto others as you would have them do unto you") while obeying the negative.

Only Elitists use Latin Phrases

2008-11-10T10:48:00.002-06:00

I think this idea is double plus good.

Republicanism is broken

2008-11-10T08:30:00.002-06:00

As evidenced by the last two elections, Republicanism is broken. It should come as no surprise that the conservative elements of the American public did not rally around the elephant these last two election cycles. They have nothing to offer independents and moderates other than, "We're not as crazy as the Democrats," and they have completely let down their base by setting back the conservative agenda of smaller government by several decades. Many conservatives, including myself, have been asking the question, "Are they really interested in the kind of radical reform this country needs?" I don't think so. The problem with the Republican Party from the perspective of the base is that they aren't willing to do anything more than tinker with the system, whereas the base is looking for a complete overhaul. Considering the increase in the total dollars spent by the government, the increase in the percentage of GDP that government spending represents, and the increases in legislation that are passed every year, tinkering is not a solution to the rampant increase in the government's drain on society (in terms of economics, culture, and freedom).

Obviously, those in favor of an increase in the role of the government in our daily lives will find nothing attractive about the GOP, other than the fact that they don't really live up to their stated values. Of course, when the GOP does pass measures that would generally be considered "liberal", the Democratic base takes no notice because, like most people, they are prone to ignore the faults of their own and the strengths of their opponents.

The GOP is like luke warm water these days, and it is a forgone conclusion that the American voter will spit them out. So, what can they do?

Next post I'll talk about why the GOP should return to some of its Goldwater roots. I'll also explain why I think this will win some independents, some Democrats, and how this will resonate, in some respects, with many evangelicals. I will also explain how the GOP can spin this to the evangelical base in order to retain it, and why the evangelical base should embrace the move as more in keeping with their commissions as followers of Christ.

Carbon Dioxide a dangerous pollutant?

2008-11-07T12:25:00.003-06:00

I don't know how I missed this, but I scarcely have words to describe what I'm thinking right now.

The first thing that came to mind was "The Hitchhikers Guide to the Galaxy". Actually, I'm thinking of the second book in the series, "The Restaurant at the End of the Universe". After using an unguided teleporter Ford Prefect and Arthur Dent end up stranded on prehistoric Earth with a group of alien settlers, the Golgofrinchans. These particular Golgafrinchans were exiled on planet Earth by their fellow Golgafrinchans back home because of their utter uselessness to society. Upon landing on planet Earth, instead of focusing on the essentials for survival, they spend their time making war on uninhabited continents and trying to find a hot spring and a soap mine so that their leader can take a hot bath. The pinnacle of their acheivements, however, have to do with their monetary policies. By establishing the leaf as their currency they all become very rich, but this wealth is quickly tempered by a bit of an inflation problem. Since the inflation problem is caused by the seemingly endless supply of leaves, they decide to reduce the supply of leaves by burning down all the forests.

A dangerous pollutant? Really? Are we really going to make war on the air that the plants and trees breathe?

While I can understand the concern (although I believe it's an unfounded concern) that increased CO2 levels are warming our planet, I think it's important to retain at least some semblence of sanity in how we address this problem. Declaring a compound that is critical to the preservation of life on this planet a "dangerous pollutant", is not an example of retaining sanity.

I haven't even MENTIONED the massive increase in potential government power this is. Can you imagine the potential for bullying and for favoring certain special interests by changing the CO2 regulations particular to that industry or even that singular organization? Whoever controls the bureaucracy that monitors and enforces CO2 regulations rules the world.

In my continued efforts to keep a positive non-partisan attitude, I will wait and see whether President Elect Obama is serious, or just pandering to his radical base.

The Fairness Doctrine

2008-11-06T09:44:00.003-06:00

Of all the things that Obama could do in his administration, I honestly think the one that would make me the most visibly angry is the reanimation of "The Fairness Doctrine". If for no other reason it will ruin my commute.

Like most Americans, I commute to and from work every day. It takes me about 40 minutes to get to work, and about 40 minutes to get back. I spend most of that time listening to news talk radio. It's the only thing that makes my commute bareable.

If the fairness doctrine were reinstituted, the massive influx of lawsuits again CBS, NBC, ABC, Clear Channel, and Salem Radio Network would all but illiminate any interesting discussion on talk radio and make my commute totally unbareable. I would be forced to by a satellite radio, and write obnoxious letters to Senator Dick Durbin every single day, reminding him of how terrible my drive home is, and how the 80 minutes a day I spend getting angry at traffic and the government is only succeeding in ruining my physical and mental health.

The fact that some 47% of Americans actually support this travesty against free speech is a massive disappointment to me. The fact that our country has been so duped into letting go of personal freedom without receiving anything in return other than the temporary satisfaction that they "stuck it to Rush" appalls me, but unfortunately it doesn't really surprise me.

That the supposed party of civil rights would so overwhelmingly support this authoritarian control over the most basic and critical right to speak one's mind without fear of retribution is also appalling, but again, not altogether surprising.

For me, the primary problem with the fairness doctrine is not in how it is implemented, but the mere fact that the government would be given such significant power that can be so easily abused. Do we really trust our government's various beauracracies to decide what is fair and what is not? Do we really trust our government not to attempt to expand that power to protect its own interests? Do we trust the government to limit itself to political discourse? What would stop the FCC from forcing Christian radio stations to offer equal air time to opposing religious theologies? What would stop the FCC from demanding that "sleezy" talk shows give equal time to moralists to condemn immoral behavior and remind the audience of the negative consequences that can result from irresponsible behavior? Even if such checks and balances are in place today, what guarantee do we have that they will remain in place? It seems to me that the only genuine response is, "I don't think they would never do that," which is not enough reassurance for me.

If the reason for reanimating the Fairness Doctrine is the fear that the consolidation of corporate power will result in a loss of free discourse, how can a further consolidation of power in the hands of the government be the solution? I presume that few people see how the one hand washes the other in this case. The Fairness Doctrine not only stifles free speech, it stifles competition. It protects the entrenched corporate interests, which is really the only thing that the government seems to do well. If all radio stations are effectively the same, then it is impossible to enter the marketplace with something different, because different has been effectively outlawed.

If the government wanted to do something about freeing up discourse on the air waves, it should examine whether current regulation protects established inerests or not. Lowering the barriers to entry is a far better way to promote free discourse on the air waves. Reducing protectionist legislation and corporate welfare is a far better way to reduce the consolidation of corporate power.

Here's my last point. While corporate power can be tyrannical, it is much more difficult for corporate entities to exercise full control over an entire medium than it is for the government. The government responds to the tyranny of democracy. If 51% of the public demand that Rush Limbaugh be driven off the airwaves, then he very well may be driven off. When it comes to the marketplace, however, 10% of the market share is all it takes (if not a good deal less) to make opposing viewpoints heard. The marketplace does not have to cater to the majority at the expense of the minority. The government, however, is much more easily bound by the tyranny of the majority.

What should Obama do?

2008-11-05T08:38:00.002-06:00

While Obama has talked a good game about universal health care and spreading the wealth and a number of other things, none of that is really possible right now. With what money is he going to expand Medicare? The economy is in shambles and the government is totally insolvent. There is a halfway decent chance that we will default on Social Security, and there's a halfway decent chance that states around the country may default on their pension programs. So how, exactly, will we also be able to afford all this "change" when that's pretty much all we have left: spare change.

So, my advice to Obama is to forget all this socialist nonsense he learned on the South Side and focus on the following:

1) Cut spending. By drastically reducing the size of the Federal Government we will be freeing up all sorts of capital that will then be available to private enterprises that provide goods and services that people want.

2) Cut taxes. While a complete overall of the tax system is in order (I would probably favor an income/sales tax split). A good start would be to get rid of those taxes that discourage savings (which we are in desperate need of): capital gains tax, corporate taxes, and estate taxes.

3) Reduce government regulation and interference in the economy. It costs money to abide by legislation, getting rid of unproductive legislation and regulations are a great way to streamline the economy.

4) Sign more free trade agreements. We import more than we export, and that includes raw materials to be used in the production of finished goods in the U.S. Tariff's benefit labor unions with established contracts at the expense of employment and the standard of living of the rest of the country.

Will President Elect Obama follow any of this advice? I'm not sure. While it seems unlikely that a Democratic President, Senate, and House of Representatives would entertain cutting spending and cutting taxes, it's not out of the realm of possibility. For all the hot rhetoric coming from the Democratic Party these past 8 years, how much of it was really honest, and how much of it was stalling so that they could pass the same measure with a different name once they took control so that they could take credit for it? That's the reality of the two-party system. They call a free trade agreement a travesty against the American work force when "W" presents it, then they call it genius when Obama presents it. They say that Social Security is bankrupt, then they say it's fine. They say we don't have enough troops, then they say more troops is an escalation. It's not as much about the policy as it is who is in charge.

So, who knows what will happen? I can only say this: those that intentionally run the country into the ground just so they can take credit for passing the same measures to fix the country they once opposed deserve a special place in hell. That being said, I will make every effort to put aside my general disgust for the Democratic Party and get behind Obama & Co if they propose any legislation that I think will promote greater freedom and prosperity in this nation or the world.

A Dollar Bubble?

2008-10-22T15:32:00.002-05:00

This is never explained in depth in the media because 99% of the population doesn't understand how this works. I don't fully understand how it works, but I know enough to be dangerous.

This past week the dollar has been making a huge rally. You can always tell when the dollar is making a rally because gas prices go down. The question that is plaguing many market experts is, "How?" The Fed has dropped interest rates, bought bad debt, and injected cash into the financial sector. All of this spells inflation, which always leads to a weak dollar. So why is the dollar so bullish?

In the first place, stocks are in the crapper, commodities are sliding, and the only safe place to put your savings is in a shoebox under the mattress, or government bonds. Foreign governments are also concerned about their investments, because the purchasing power of the United States drives their export business. Many governments intentionally keep their own currencies undervalued and invest in dollars in order to prop up U.S. purchasing power. When U.S. consumers are buying, their factories are working overtime. For some reason they don't think this will catch up with them. That's what's happening today. The printing presses of the world are running in order purchase U.S. Dollars (our printing presses are running to keep up with the demand) so that these nations can buy government bonds. In case you weren't aware, I don't believe you can buy government bonds in Euros. You can only buy them in dollars.

So, in these troubled times, the only safe place to put your nest egg seems to be in U.S. Government Bonds, and the only way to buy those bonds is to convert your own currency for dollars. Additionally, the only way to keep the factories running, is to increase the purchasing power of the dollar, which means buying more dollars and purchasing more government bonds.

It's crazy, isn't it? It can't possibly work, can it? If you're thinking this is a global Ponzi scheme, you're right. There is a great video on YouTube that explains how this works.

So when will the proverbial "other shoe" drop? Well, it might happen when all of this new money is spent in the U.S., or it might happen when all of this debt is due. It might be both. We may experience a rather painful correction in the next year when all of this new money floods the market, creating more bad investments & speculation and running up the price of gas. With all that behind us we may still find that the worst is yet to come when the U.S. government has to come up with $10 trillion dollars (or whatever ungodly amount it will eventually be) to pay off all of the foreign debt it owes.

Joe the "Plumber"

2008-10-20T12:34:00.002-05:00

Oh, no! He doesn't have a license? What's this?! He owes property taxes? This scurge against humanity ought to be thrown in prison and never let out.

I love Rockwell's take on this: requiring a license to be a plumber is a violation of free association, and taxing property is a violation private property rights.

Can you hear that sucking sound?

2008-10-15T08:46:00.002-05:00

A week ago, I posted an article about Larry Burkett, who was a very sound Christian financial counselor who was criticised for going overboard on Y2K. This week I'm posting an article by economist Gary North, another Christian who many consider to be a little too preoccupied with the end of the world. North runs a website, garynorth.com, where he allows access to his daily articles for $14.95 a month. His site focuses on a few main areas of interest: 1) How world governments are royally screwing up the economy, 2) financial advice, 3) opinions in support of a generally more libertarian / free market government, 4) biblical defenses of the free market (ie freedom). While he has written in other venues about the end of the world, I don't see much of it on his site. Many Christians and non-Christians would find his ideas about the end of the world very controversial, but I have not read anything he has to say on the subject and I am not particularly interested in his theories on that subject, so I can't and won't comment on them. I will only say that I find his opinions on the economy and the free market to be very reasonable.

The quote I wanted to highlight in the linked article is this:

"The coordinated big bank bailout programs do not solve the carry trade problem. They are designed to get banks lending to businesses. But in a worldwide recession, why would banks want to lend money to businesses? They would prefer to lend money to governments. Politicians like this. They can spend more money this way.

This transfers liquid capital from the private sector to the public sector. It subsidizes government bureaucracies at the expense of productivity. But it is a rational response to recession when the government offers guarantees against bankruptcy. The guarantees are a major source of asset allocation from the private sector to the public sector."

The purpose of the bailout is to unfreeze the credit market and get banks lending to banks and businesses again. The method being used to acheive this goal is to borrow from the private market in order to lend to struggling businesses. This will necessarily drain the market of the very liquid capital that it needs to unfreeze itself. If the government really wanted to get banks to start lending again, it would dramatically reduce spending, and thereby decrease the number of government bonds that they sell. Drying up the supply of government bonds would force banks to put their money back into the free market in order to make a profit, by increasing spending we are increasing the amount of liquid capital that is being sucked out of the free market. "Ah-ha", you may say, "But by offering banks a guaranteed interest rate, we are encouraging them to lend the money that they would have otherwise tucked under the proverbial mattress so that the government can lend the money to the businesses that need it. The government acting as a broker of sorts, guaranteeing the investment, and facilitating the flow of money." At what cost? The government cannot guarantee results. No matter how powerful the government thinks it is, it cannot guarantee that the money that it lends out will turn any kind of profit. It can only guarantee that it will print money to pay back the lender if the venture fails. Ultimately, the government is lending money to unhealthy businesses at the expense of healthy ones. Solvent banks and solvent businesses will not receive support from the government. Troubled banks and investment firms will receive the lion's share of the bailout. This money is much more likely to be sunk into the same non-performing investments that are plaguing our economy that need to be liquidated.

By borrowing money we are draining the private market of it's accumulated wealth and making it more difficult for profitable businesses to borrow money needed for expansion. By putting this money into non-performing assets we are delaying the liquidation of these same assets which have locked up more of the much needed liquid capital needed by our economy to expand. By guaranteeing the ROI for lenders that buy bonds we will be forced to print money to pay back these loans which will lead to inflation.

Many economists have discouraged liquidation of capital because selling some asset at a loss puts downward pressure on all the other assets being held, which reduces the amount of capital in the economy. For example, if I'm a bank with a number of customers facing foreclosure, by selling these homes for a loss I am putting downward pressure on the market, which reduces the value of the rest of the houses in the community which reduces the value of the assets that my bank is holding. So, after selling off a dozen homes, my financial situation may be worse off than it was before, forcing me to sell more foreclosed homes at an even steeper discount. I contend that the latter (selling homes) is preferable to the former (holding onto homes), because our economy needs liquid capital, not homes that are worth $500K on paper but not in the real world. It's the difference between real capital and fake capital. We think that we can fix our economy with fake capital. We cannot. It will take the real stuff to get our economy moving again.

The Big Dogs & Big Bailouts

2008-10-14T14:33:00.002-05:00

I don't hate big corporations. When people talk about how terrible Wal-Mart is, I roll my eyes. It doesn't get my ire up when I hear about the scandalous pay that some CEO's get. But I get really animated when I think that businesses are getting special treatment, and when the market is being circumvented in favor of cronyism.

I am a free market champion, not a big business champion. When the market crashes, and big banks go under, I cheer the speed and effectiveness by which property is reallocated and investments are realigned. I do not, as some conservatives are prone to do, support preferential treatment, subsidies, and tax breaks for the same reasons that I oppose excessive regulation and burdensome corporate taxes.

With all that in mind, I submit to you that many of the complaints of the left against large corporations should really be directed at the Federal Government. When the government is doling out special favors, like freshly printed money (i.e. low-interest government loans), it goes to the big guys first. It's the big guys that profit the most from those loans. It's the big guys that get the bailouts, the subsidies, the preferential treatment, that helps them make it through the correction. And it's the big guys that are given first dibs when it comes to buying up the bankruptcies.

It is not the free market that is creating these obscenely bloated multi-billion dollar corporations, it is the privileges that they receive from our government that allows them to grow to the size that they do.

If we allowed the free market to work, we would see smaller privately-held debt-free banks picking up market share. Since we have a corporate-government cabal, we are seeing multiple corporate entities merging into corporo-government monstrosities. I can guarantee you that the free market would not have fostered these transactions. The free market would have parsed these entities out to their creditors, and their creditors would have sold them to hundreds of local and regional interests who would have been willing to pay much more to gain market share in their region.

The Broken Window Fallacy

2008-10-13T08:59:00.008-05:00

I have a perspective on the "broken window fallacy" that I don't believe is widely held. Llewellyn Rockwell expands the fallacy quite a bit in the linked article, but I feel its necessary to reinforce one of the more subtle points that Rockwell makes, and nail down the fallacy to two core flaws in economic thinking.

Here goes:

The broken window fallacy states simply that "that the destruction of wealth fuels its creation". For example, it is not uncommon for certain experts (it doesn't matter what field) to say that while hurricanes are terrible, the result in the long-term can be a more prosperous local economy after rebuilding because of the boom of construction jobs and the inflow of investment money to rebuild. This, however, is a fallacy. While a particular group may benefit in some ways, society as a whole suffers a number of costs that are not readily counted by the experts.

Those that believe that the broken window fallacy is, indeed, a fallacy, would generally contend that it is not a good thing that cars are always breaking down because mechanics have to be hired to fix them. It would not be a bad thing if a car company developed an engine that did not need any maintenance for 100,000 miles (think turbines and electric motors), even if thousands of mechanics lost their jobs.

The usual argument against the broken window fallacy is one of opportunity cost. If your car doesn't break down, then you might use that money to buy a new couch. Buying a new couch creates jobs for furniture manufacturers. When your car breaks down, you may have hired a mechanic, but some poor furniture manufacturer is out of work. Ultimately, rebuilding or maintaining what you already have does not increase your happiness nearly as much as producing or acquiring more. In terms of opportunity cost, the broken window fallacy fails to recognize that people are happier when they are spending their money on more things instead of spending money maintaining the things they have.

All this is pretty cut-and-dry broken window stuff. As follows are my elaborations. I believe that the broken window fallacy has two parts, and that most economists that point out the errors in the broken window fallacy typically only cover the second part, and neglect the importance of the first:

1) I'll go backwards and start with the second part first. As previously shown, the broken window fallacy fails to account for opportunity cost, and can be thwarted by showing that not all consumption is equal. For those that think of economics purely in terms of dollars and cents, this can be hard to see. But when you view economics in terms of productivity, happiness, and standard of living, it is easy to see. If no one ever had to replace a spark plug or get an oil change, then every car owner would have that much more money to spend on other things that would raise their standard of living and bring them more happiness. As Mr. Rockwell points out, the broken window fallacy can also be applied to lots of government spending programs including the most recent bailouts. Not all consumption is equal, digging holes just to fill them may increase our GDP, but it doesn't make our lives any better off. To Mr. Rockwell's point, bailing out failing enterprises diverts resources from where people want them.

2) Here, however, is core belief that leads to the broken window fallacy: moving money from savings to consumption necessarily creates prosperity. Think about your car again: if you didn't have any savings whatsoever, and your car broke down, you would be screwed. The reason you can afford to fix your car is because you have money saved. The break-down was the event that caused you to remove your money from savings and consume it. This, as some Keynesian Economists would argue, is a good thing. In their view, saving money takes currency out of circulation which reduces economic activity. By taking money out of savings and consuming it, you begin again the cycle of consumption that produces wealth. Especially during times of economic duress, they argue, people should be encouraged to remove money from savings and spend it. So, the fallacy is really that savings does not benefit our economy, and removing money from savings is always a good thing, and any event (even a broken window) that causes people to reduce savings and consume more can be considered an economically beneficial event. Aside from the obvious opportunity costs (you are spending now at the expense of spending on something you want more at a later time), the reduction in the supply of savings will increase the interest rate. When people spend instead of save, lending money becomes more expensive because the supply of savings has decreased. This is difficult to see on a microscale, but if a hurricane were to devastate Florida, and Florida businesses had to borrow money to rebuild, we would certainly see a boom in construction jobs, but we would also see interest rates rise elsewhere in the country because much of the available savings was being lent to Floridians to rebuild. So expanding a business in Detroit becomes more expensive because rebuilding in Florida is raising the price of savings.

When we see that the broken window fallacy is really built on two premises 1) that consumption is better than savings, and 2) that all consumption is equal, we can see that there is a lot of economic activity that we could classify as part of the broken window fallacy. When we lament the loss of jobs to robotics in the manufacturing industry, we are lamenting the fact that businesses are saving instead of consuming. We are secondarily encouraging them, since all consumption is equal, to continue to spend money on manual labor because then the market will not have to adjust to accomodate the changing spending patterns since that change can be costly and, quite frankly, scary.

Our economy is virtually built on this fallacy. Our government believes that we can fuel economic growth through consumption, no matter the consumption, at the expense of savings. We do this through government taxation, redistribution, and consumption. We believe that we can offset the drain that this places on the economy and the supply of savings by printing money and lending it to businesses to invest. We fail to recognize that printing money in order to keep the supply of savings up discourages consumers from saving because it doesn't just reduce lending interest rates, it also reduces savings interest rates. We also fail to recognize that printing money creates malinvestments that lead to the business cycle which is the reason for our current economic funk. All of which can be traced back to a simple flaw in argument because we have chosen to base our policies on anecdotes involving children, rocks, and windows instead of sound, reasoned, economic thinking.

I knew I liked that guy

2008-10-08T08:38:00.002-05:00

I used to listen to a lot of Christian Radio. Not the hip station with the cool DJ's that plays "Christian versions" of pop-singers. I listened to the station that briefly interupted sermons for 10 minutes of hymns and advice for stay-at-home-schooling moms. It was the only station that had good reception, but it grew on me, and I enjoyed it.

One of the programs, which I believe is still running, would come on in the afternoon just before rush hour: Crown Financial Ministries with your host, Larry Burkett. Well, Larry Burkett passed away a couple of years ago, but his legacy lives on.

The thing I loved about that show was how Mr. Burkett brought people down to earth, and focused them on sensible, attainable goals, and sustainable spending patterns. While there were quite a few callers that had some fairly complex questions about long-term investing, most of the calls centered on two subjects: tithe and budgeting.

Let me summarize 4,376,297 of Larry Burkett's responses: tithe on gross personal income, not on gross business profits or revenues, and don't spend money you don't have. That's it. Want to buy a car? Pay cash. Did you make money last year? Tithe it to the Lord. You run a small business and you feel compelled to tithe (10%) on your revenues even though your profit margin is only 5% which would immediately give you a 5% loss? Don't; make yourself a salaried employee of your company if you are able to and tithe on your gross personal income. You don't have any money tucked away for a rainy day? Cancel your cable subscription and start putting that money in a savings account. When have I saved enough money? When you have breathed enough oxygen.

Programs like Mr. Burkett's remind me of the Saturday Night Live skit, "Don't buy stuff you can't afford." What's not to love about advice like that?

Well, I recently discovered that there is something else I love about Larry Burkett. He wrote a book called The Coming Economic Earthquake, which was considered by many to be quackery at the time. It probably didn't help that he went a little overboard on Y2K; but I say, "Let he who did not store a couple extra gallons of water in thy basement in December of 1999 cast the first stone."

Well, all you Keynesian nay-sayers. It turns out that what's good for the average family, is also good for the Federal Government. Here's a few more ideas for SNL skits that I would like to pitch. We can even bring back old cast-members like Steve Martin. We can bring back Dan Aykroyd for, "Don't commit the country to foreign wars you can't afford." You can get Eddie Murphy to star in, "Don't give millions of people hand-outs you can't afford." They shouldn't have a problem getting Chevy Chase to play a part in, "Don't create giant government bureaucracies that don't produce anything you can't afford." And, of course, how could we leave out Bill Murray who would do a fabulous job in, "Don't print money and expand credit so that it envelopes our economy in a sea of debt and results in economic devastation we can't afford."

Let's think critically here for a minute. If a family is unable to acheive financial freedom and security by spending itself into debt, why would we think that the government can? If the average family needs to save for the future, why wouldn't the government? If SAVING is the family's key to financial stability, then why would we think that SPENDING is our country's key to economic success?

Part II - "We Never Should Have Bailed Out FF"

2008-10-02T11:55:00.003-05:00

Lest you all think that this crisis caught us all totally unaware, you can refer to this article for proof to the contrary.

What is the difference between a $150K house mortgaged at 15% for 30 years, and a $300K house at 6.5% for 30 years? In terms of payment? $0.46 a month. In terms of total expenditure over a 30 year period? $166.31. In either case you will end up spending $683,000 on interest and principal. So what's the difference? Well, as the prices are being run up, the potential for flipping houses, as we saw, was phenomenal. The initial cash outlay, however, is much larger, which means that saving for a home is more difficult, consumers are more dependent on credit to get into a house, and foreclosures are much more dangerous because the potential for loss is much greater.

The way to get out of this mess, is to back-track. Interest rates need to go up, and home values need to go back down. It would be great if we could wave a magic wand to acheive this, but that's not going to happen. It's going to be a slow and agonizing process.

As values decline, borrowers will have to stay in their homes longer before they have built up enough equity to sell their homes without falling short of their mortgage. The alternative is to foreclose or short-sale. Agonizing. But an interesting thing happens when homes are foreclosed or sold-short. The buyers of these homes produce a steady income to the banks, and they have the flexibility to sell the home because the value has dropped so substantially.

If enough borrowers are forced into foreclosure or short sales, the banks that lent them money will file bankruptcy. Stock-holders lose their investments. Large savers lose a portion of their life-savings. Agonizing. But again, an interesting thing happens. The banks assets are bought up for pennies on the dollar by other banks. Since these banks are collecting large revenues for smaller cash outlays, they are more able to absorb short-sales and foreclosures. Interesting how that works, huh? Let's say that WaMu made a $300K loan at 6.5% interest over the course of 30 years. Now let's say WaMu goes under, and JP Morgan Chase swoops in and buys all their assets, including that $300K mortgage, but they only pay $150K for it. That would mean that the initial outlay of cash on Chase's part is only $150K, and the effective return on investment becomes 15% instead of 6.5%. The market will not be fooled my friends. Your property will return to its real market value. The profits collected on your loan will reflect your real market risk.

It did not take long for the entire market to attempt to readjust and reallocate in one fell swoop. When Fannie Mae & Freddie Mac were on the brink of financial disaster, we had that chance. Fannie Mae & Freddie Mac hold more mortgages than any other entity in America. Their failure would have meant that most of the mortgages in America would have been sold for a pittance to... whomever. Banks could have bought out their own loans if they had the cash on hand. Solvent Banks like JP Morgan could have scooped up hundreds of loans that would have produced 15% ROI over the next 30 years.

All of this could have put the financial industry in a position to avoid freezing up lines of credit. Bank obligations would have been drastically reduced, which would have freed up capital for more profitable ventures. All of this would have taken place at the expense of Fannie Mae & Freddie Mac investors, who would have had to suffer a loss before moving whatever cash they had left to banks and enterprises that had purchased FF's assets and were now making out like bandits.

Now, this does not mean that we could have gone BACK to sky-rocketing home values at low low interest rates. Not at all. The absence of FF would create a sizeable gap in the available credit, which would result in an increase in interest rates. Interest rates would rise to more sensible levels. Many people would be stuck in overpriced homes, unable to sell without cash reserves in the tens of thousands of dollars, but that potential situation is no different than the situation we are in today. The key difference would be that savers would not have to worry about additional bankruptcies robbing them of their life savings. Eventually, these homes, too, would be liquidated, and the market could return to sensible and sustainable growth.

This notion that any organization is too big to fail is ridiculous. Was the British Empire too big to fail? What about the Soviet Union? These companies are not too big, they are too privileged to fail.

Allowing FF to fail should have been the first of many steps on the road to recovery. Instead, we bailed them out. Now we are offering to bail out an entire industry which will only have the same result as bailing out FF. Entities in debt will find no relief. Overpriced assets will not be written-down or sold. Stocks will briefly rally, as they did when interest rates were dropped in 1929 following the crash, but they will fall again as they did then. It won't be long before some politician, probably the next President, will stand at a podium in a month or so and say something outlandishly ridiculous like the following:

"All the factors which make for a quick and speedy industrial and economic recovery are present and evident. The Federal Reserve System is operating, serving as a barrier against financial demoralization. Within a few months industrial conditions will become normal, confidence
and stabilization in industry and finance will be restored."
- Herbert Hoover

Why the Bailout is a Disaster - Part 1

2008-10-01T14:46:00.005-05:00

There is more material here than you could possibly read in one afternoon, or even a month of afternoons, but it's all there.

I'm going to try to be clear and concise, but I may be very sarcastic, cynical, and at times: incensed. The $700B bailout is a mistake of massive proportions.

The bailout will devestate the dollar. In the short-term, the stock market will rally because speculation always brings rallies and speculative rallies are always short-term. By definition, it won't last.

Why the bailout won't work - Reason 1 of, like, 1,476.

"We have a 'credit crisis' because all our capital is wrapped up in houses that are too damn expensive"

The problem with our economy is that housing prices are still too high. So is health care and education, but that's a rant for another day. Whenever these politicians bloviate about kick-starting the housing market, or start moaning about how the housing market has "slowed", or how it's "sluggish", or how prices are "depressed", I want to send a swift quick in the nuts to my nearest Senator.

Are we nearing the end of this economic downturn? Well I live in DuPage County (just outside of Chicago), and I have a great little economic indicator that I've been using, and I encourage you all to use it, too. When I can buy a 1400 square foot house for $150K, then I will know that we are nearing the end. If I can't buy a 1400 square food house for $150K, then I know that homes are still overpriced, and I know that we still have a long way to go.

What is so great about unaffordable homes? Where did this insane misconception come from that we can double the price of homes every 5 years and somehow our economy will not go into a full-fledged economic nuclear meltdown?

These over-priced unsaleable homes are KILLING our economy. I have no interest in seeing a return to rising home prices. At least not until I can buy a 1400 square foot house for $150K. Then they can start to go up again. But it shouldn't go up to $300K in 5 years! It should go up to, like, $175K, at MOST.

This notion that we can enter a period of indefinite prosperity by building homes nobody wants and charging prices no one can afford in order to give construction workers jobs so that they run up credit card debt on big screen TV's and the $150/month cable bill that comes with it is non-sensical Keynesian BULLSHIT and it makes me angry just thinking about it.

We have tied up massive sums of money into the housing market that doesn't belong there. Nobody wants a 3 bedroom house so badly that they are willing to pay $500K for it. This is called "malinvestment", and it is the result of inflationary credit, generated by the Fed, loaned out by Fannie Mae and Freddie Mac. We are experiencing a "panic" due to speculation caused by the aforementioned credit inflation. The only way to end the panic, and return to prosperity, is for the market to reallocate assets to what the market wants.

This bailout does not alleviate the core dillema: getting money out of homes to where it belongs. The bailout will enable banks to keep their assets tied up in houses for another couple of months.

Stay tuned for:

Part II - "We never should have bailed out Fannie Mae and Freddie Mac"

Part III - "Bankruptcies are the SOLUTION, not the problem"

Part IV - "Banks won't write-down their homes if they think $700B is coming their way"

Part V - "The world WON'T come to an end, and other delusions of Paulson and his bailout cronies"

Part VI - "The Bailout will maintain the current corporate-government power structure, but it will not help the economy"

Part VII - "I'm becoming a full-fledged no-holds-barred no-apologies small-L libertarian because I love freedom, I don't trust the government, and I don't care what anybody thinks about it."

Part VIII - "I'm voting for Chuck Baldwin for President because I live in Illinois and Obama's victory here is a foregone conclusion."

Can you blame the poor?

2008-09-30T12:32:00.002-05:00

The conventional wisdom surrounding the real estate bubble (at least amongst conservatives) is that congressional meddling forced banks to loan money to the unqualified. The increase in the number of now qualified loan recipients increased the demand for housing, which drove up the prices. When these mortgage-holders were unable to make payments, as the free market knew they wouldn't, the foreclosures sent a shock wave through the industry, tightening up requirements, reducing demand, and thus reducing prices.

The problem here is that this explanation violates the laws of supply and demand. If banks were simply being forced to loan to people that were not qualified, then the result would be that mortgages would be generally less profitable, and there would be less mortgages available, shrinking the amount of money spent on mortgages, not increasing it. What the government was engaging in was classic price fixing. You cannot charge more than "x" for this loan. In every other industry this inevitably results in shortages. When the price of rent is fixed too low, people stop building apartment buildings, and a shortage of living space results. In every industry, price fixing results in shortages.

If the government made mortgage-lending less profitable by forcing banks to increase the amount of risky loans they made, then the amount of capital available to mortgage loans should have dried up quickly. Banks should have shut their windows and said, "Sorry, we are only able to loan out x-million dollars this quarter, and we have already met that limit." Capital, after all, is a scarce resource.

Ahhhh... but when the money can be borrowed from the Federal Reserve at scandalously low interest rates, the supply of capital is inexhaustable.

In the world of sanity and freedom, the risk associated with investing is reflected in the interest rates (and the ability to secure a loan, of course), and the interest rates are a reflection of the supply of capital, and the supply of capital is the sum total of real savings, and real savings is a reflection of the consumers willingness to save now in order to spend later.

As borrowers take out loans to purchase houses, the prices of homes go up. When entrepeneurs see housing prices rise they exclaim, "Ah ha! Prices are on the rise, perhaps I should invest in real estate?" But as more money is taken out of the supply of capital, the interest rates go up. The entrepeneur despairs, "Real estate is rising, yes, but the interest rate is higher than the rise in prices. Now is not the time to invest. I will find some other market that is not being fully satisfied."

But if the banks have at their disposal an inexhaustable supply of capital at below market rates, a government encouraging them to grant bad loans to people that can't pay, and a government sponsored enterprise promising to purchase every bad loan that is made, all of the stops have literally been pulled out. All of the natural impediments to rampant speculation have been removed. The result is obvious. Home prices continue to rise because the interest rate fails to respond. It is easy to blame the Fed for failing to respond correctly to the rise in prices, but the real failure is central planning in general. Why attempt to replicate the market interest rates when you can simply allow the market to determine its own rates?

Fun fact - "Pulling out all the stops" refers to pipe organs which use "stops" to restrict airflow which alter the sound of the organ and restrict volume. Pulling out all the stops maximizes the volume.

Gold, the economy, and other musings

2008-09-30T10:26:00.002-05:00

I was talking about the economy and the bailout with a co-worker of mine, and talking things through generated a couple of interesting insights.

1) Economies can be compared to individual budgets with surprising accuracy. I live in a small condo that I truthfully paid too much money for. Housing prices are going down, but the percentage loss is progressive: the more expensive the house was before, the larger the percentage drop in value. That means that while I will have to pay out of pocket to get out of my mortgage, the next house that I will want to move into will be significantly cheaper than it was before the market collapse. So, if I lose $15K on my home, but the next home I purchase is $50K less than what it was before, I am $35K better of after the collapse than before. So how do I, as an individual, put myself into a position where I can grow the size of my house? I have to save my money in order to pay out the difference between my homes real value and the artificially high cost of my mortgage. So, the first thing I need to do is SAVE. Next, I need to sell the house that I am in at a loss, and pay off the difference with my savings. So, the second thing I need to do is LIQUIDATE the inflated assets and TAKE THE LOSS. Then I will be in a position to purchase my next house, which will be larger and will be more representative of the actual value of the home. This is the same procedure for the economy. We have borrowed heavily and saved little as an economy. In aggregate, we need to increase the amount of REAL SAVINGS available as credit for business expansions. We cannot substitute printed money for real savings, and we cannot substitute confiscated money for real savings. Next, we must collectively liquidate the businesses and capital investments that are not generating wealth. This will mean that assets are sold for a loss. Companies go out of business. Employees are laid off. Lastly, we reapply these people and assets to industries that ARE performing. Once the capital is saved, and the people are positioned in the right sectors of the economy, standards of living will increase again, and the economy will grow.

2) Monetarists think we should target 3% monetary growth for the economy every year. Since the market knows that the money supply will grow by 3% every year, people factor that growth (inflation) into their long-term calculations. Austrians say, "If it is theorized that growing the money supply 3% every year will have virtually the same effect as keeping the money supply constant, then why not just keep the money supply constant? Instead of increased productivity resulting in wages increasing at a FASTER rate than prices, increased productivity will reduce prices, and wages will stay the same." Most Austrians recommend tying the money supply to gold in order to reduce the possibility of excessive increases to the money supply. What Austrians do not always say, although most of them recognize, is that the supply of gold is increasing at a reasonably constant rate as well. You can still have a drastic increase in the money supply, even if it is tied to gold. My coworker described to me the devastation that took place in Spain because the Spanish government was wasting so much of its resources mining gold in the new world. This drastic increase in the money supply in Europe wrecked the economies of Spain and many others because the inflation rate was more than the market could consistently adapt to. The productivity that was spent mining and coining gold was essentially wasted, becuase adding more gold currency to the money supply added no real wealth to the economy of Spain. The English government, on the other hand, invested their wealth in growing cotton and tobacco in the new world, which were desirable consumable products that increased the standard of living of Europe.

Tokyo Transit

2008-09-17T08:42:00.002-05:00

I would like to draw your attention here as a follow up to my previous article.

Why does Tokyo have an extensive privately-owned public transit system, and no US city has anything comparable?

Wendell Cox says elsewhere that the reason that the auto, and travel by road, never took precedent in Tokyo as it did in other countries is because of poverty. After WWII, Japanese could not afford to buy cars, and depended on public transit for their livelihood.

I would slightly modify that statement to simply state that car travel was too costly. In Tokyo's case, the prohibitive cost was purchasing an automobile. Hypothetically, a similar public transit system could have developed just as organically anywhere in the world if the prohibitive cost had been road building.

In fact, even though Tokyo's highway infrastructure has been built, and Tokyo's citizens are now able to afford to purchase an automobile, the public transit system is still a more viable travel option because of congestive traffic and heavy tolls. The marginal costs of money and time are greater to travel by road than by rail.

I have no idea how much Tokyo spends on highway infrastructure, and I have no idea whether the tolls are reflective of the actual cost to build and maintain those roads. Tokyo could be undercharging for highway travel, or they could be overcharging to encourage public transportation. I don't really have the energy to look up all this random crap when I don't even know if the information is available.

Regardless, it shows that when car travel is marginally more expensive than rail travel, consumers prefer to travel by rail, and massive rail systems are built to accomodate those passengers. The systems are efficient, and they are profitable.

It is impossible to recreate a system like that in the US so long as the public is paying for highway travel as a fixed expenditure, and not as a variable/marginal expenditure, because the public will never overwhelmingly prefer a marginally more expensive mode of transportation so long as the public remains rational. Additionally, to cut off these subsidies and charge commuters on the margin would be economic and political suicide. The market would respond, of course, in the most efficient manner possible. But the markets unenviable task would be to reallocate billions upon billions of dollars to more efficient use.

I have always said that people are like water, they always seek the path of least resistance. When the government provides subsidies for some activity, it is like digging a trench so that the water might flow in that direction. When the government enforces penalties for other activities, it is like building a dam so that the water is halted. When these subsidies and penalties are removed, the market reacts, in the same way water would react, by dramatically and radically altering it's behavior. Of course, politicians then blame the free market for the readjustment saying, "Look at the devastation that results when the free market is left to run its course." It's like building a dam, blowing it up, then expressing surprise that, lo and behold, the village that was built in the riverbed below the dam is flooded and washed away.

So, if the government has been subsidizing travel in the far-reaching suburbs, and those subsidies are quickly removed; the drastic and radical return of the populace to the city would devastate the economies in those suburbs. Formerly prosperous townships would be reduced to ghost towns.

Free Roads

2008-09-16T12:40:00.002-05:00

Here is an example of another aspect of our society that we generally take for granted, and rarely consider the costs.

Like everything the government does, we tend to think of the cost to us on the margin. I have already paid my taxes, so even though I have paid for the roads, the marginal cost of driving one more mile on any side street is $0.00. The marginal cost of driving to work is $.40. I don't think of my total expenditures, and I don't think of my cost per mile; I only think about the marginal cost, which is usually $0.00, sometimes a buck or two.

Actually, the unintended consequences are many, and they are some of our progressive friends favorite pet gripes. Do you, or someone you know, gripe about how more people ought to take public transportation? What about global warming? How about urban sprawl? Lack of alternatives to oil?

I believe that you can tie each of these back to government spending on highways (mixed with credit expansion on the part of the Fed).

Let's look at public transportation:

Today, a good portion of your travel expenses are sunk costs. You already paid your income taxes and your property taxes. If you paid off your car, you don't think about that either. When you get in your car, the only costs you think about are gas and tolls. These are your marginal costs. When you take the train, the only cost you think about is train fare, which is your marginal cost. Rational people don't consider their sunk costs (taxes) when they make decisions, they only consider the additional expenses they will incur, which are their marginal costs.

Traveling by highway has lower marginal costs because most of the cost of building and maintaining roads is built into taxes which is a sunk cost. Traveling by train has a higher marginal cost because most of the cost of building and maintaining rail lines is built into your fare which is a marginal cost.

So, if it cost you $5 in tolls and gas to get to work, but $6 in train fare, then you are more likely to drive than take the train. You are not considering the $100's of dollars you already spent on highway maintenance because you are a rational person that doesn't consider your sunk costs. If gas and tolls reflected the real costs of travel, then they might be, say, $10, in which case you would be more likely to take the train.

The other problem with a subsidized road system is that once rational people started driving instead of taking the bus, people and businesses started to relocate themselves away from city centers and railway stations. There are many reasons people and businesses would prefer to be located away from city centers, but the overarching reason that doing so was AFFORDABLE was that the government was subsidizing their ability to travel by road.

Once the sprawl took place, it became impossible to retrofit an efficient and profitable public transit system into an environment that formed around highways and roadways. It's like trying to fit a square peg in a round hole. The mode of transportation we think is better is impossible to manage in the infrastructure we created.

Whether the benefits of our road system outweigh the hidden costs is difficult to answer. The costs of our current system are largely hidden, and the alternative free market transportation system is strictly hypothetical.

Perhaps I will dedicate some of my next posts to examining how government roads caused global warming (if you're into that) and killed the electric car.

More Policy Blunders

2008-09-12T13:18:00.002-05:00

At least this one isn't in America:

http://news.xinhuanet.com/english/2008-09/11/content_9913884.htm

Here are the problems with the policy:

1) CPI is not necessarily an indicator of inflation (ie, an increase in the money supply). Especially if there are price controls in place (!). There are hundreds of factors that contribute to the CPI, and inflation is one of them. The kind of inflation that is promoted by most central planners affects producers first, so the increase in prices usually affects capital goods first before it trickles down to consumer goods.

2) Recession will not arrive because of weekening demand in the export sector. Recession will arrive because the entire world has been pumping liquidity into the global market (China especially) for the last ten years, and that credit bubble has to burst. Consumption will fall when credit runs out and real savings has to kick in. When it is realized that there is not enough real savings to support the inflated credit, the construction industry and capital goods industries will collapse. When those industries collapse, and unemployment surges, consumption will collapse behind it.

3) By enacting price controls, the government is protecting consumers, and encouraging consumption, at the expense of producers. The producers will be hardest hit by the credit collapse, because they are the first to receive the expanded credit, and they were the first to invest that credit in industries that ultimately won't be supportable long term. Since price controls are in place, profits are being drained. When the economy collapses, these producers will have no reserves to keep themselves afloat. Forget about growing, these companies will break in half because of their unsupportable debt, and the inability to make a profit.

The response, of course, will be more credit to artificially fuel growth, and more price controls to keep the CPI down. This will, of course, aggravate the problem. Unfortunately, I think China is going to have a really hard time getting out of this because of their political philosophy. It's a communist country. They are not going to be willing to relinquish control in order to let the market sort things out for itself.

Fannie Mae & Freddie Mac

2008-09-08T11:18:00.002-05:00

I'm really shooting from the hip here, because there hasn't really been enough time for me to read anything on the subject. But I'm going to go out on a limb on the off chance that I might be right. If I'm wrong, I already told you I was uncertain of my own predictions.

The government is spending billions of dollars nationalizing Fannie Mae & Freddie Mac (FM&FM). What will be the outcome? The government is basically taking money from productive enterprises and propping up bad investments in real estate. While the rest of the economy is avoiding real estate like the plague, the government just pumped in billions of dollars. The problem with this move is that the government is not solving the problem of foreclosures, it is propping up the entity that created the high foreclosure rate in the first place. FM&FM borrows money from international investors at low interest rates, it then lends this money to banks to lend to borrowers. FM&FM received this money from the US, where government policy has been to inflate the currency, as well as international investers whose governments have the same policy. Because of FM&FM, banks of you are familiar with were able to offer sub-prime mortgages, which got us in this mess in the first place. By pumping billions of dollars into this system, the US government is enabling this practice to continue.

If this somehow fixes our foreclosure mess, I would be terribly interested to find out how. In my opinion, a "successful" bailout will only enable home-borrowers to begin another round of musical houses. Homes will be bought and sold, which will run up prices until this latest round of inflationary credit runs out, at which time the market will collapse again. If it doesn't acheive this end, then it will only prolong the length which houses sit on the market waiting to be sold. Loans will be available, but no one will be willing to borrow money for a house that they know is not worth the asking price.

The other major problem with this policy is that we are "robbing Peter to pay Paul" to borrow an overused expression. In order to fund this little adventure, the government must take money from sectors of the economy that are performing well, in order to prop up the real estate market. By taking money away from productive enterprise, we limit the consumers ability to pay for goods like real estate. In aggregate, we have made it easier for banks to lend money, and more difficult for consumers to pay off the loans.

My guess here, is that the US government had to bail out FM&FM, not because of the housing market, but because of the investments of foreign nations. It is bad foreign policy to allow your creditors (ie, the Chinese) to lose billions of dollars they invested in the US.

What's the real solution? That's a good question, and while I could offer a solution or two, none would avoid the hardship that the US must necessarily endure. That's the trick: we don't consider solutions to be sound unless they ward off the recession and return the economy to what it was in 2004 (or whatever other arbitrary date you want to pick). Personally, I think the real solution is to let FM&FM fail. Interest rates would skyrocket. Home prices would plummet. Investment portfolios would collapse. However, we would begin the real road to recovery. US citizens would see the true cost of borrowing money and save their money for future purchases instead of borrowing against future earnings.

Troopergate

2008-09-04T10:14:00.003-05:00

http://www.washingtonpost.com/wp-dyn/content/article/2008/09/03/AR2008090303210.html?hpid=artslot

He's a racist. He's a poacher. He's abusive. He drinks on the job. He makes death threats.

I'm supposed to believe that the police and the union "disciplined" this guy with a 5 day suspension and that should be the end of it?

I'm also supposed to be shocked and surprised to find out that Wooten is a regular subject of conversation for Palin? Really?! You mean she repeatedly talks about the guy that threatened her father? You mean she displayed outrage over the fact that this guy was still employed as a police officer, of all things? Outrageous.

The real problem here is that it looks like Palin is running some serious CYA, and that CYA does not appear to be totally honest. If Palin had been a bit more upfront, and said, "Listen, this guy was a bad cop, and the entire establishment was circling the wagons to protect him. My family has some personal history with this individual, but I think it's reasonable to say that the way he was disciplined was unacceptable. I dismissed Monegan for xyz reasons, but I'm not going to say that his failure to properly discipline an abusive state trooper wasn't part of my motivation." The problem with that, is while it might go over well with the public, and it might go over well in any other non-governmental organization, it wouldn't go over well with the unions and the lawyers they pay.

We have the same problem in Chicago with the same kind of corrupt and abusive cops with the same good-old-boy network defending them. What was the solution? Replace the police commissioner. It's called reform. It's what good executives do to clean up their organization.

I admit that the allegations against this guy Wooten seem to be a little trumped up. He's accused of tasering his stepson, but he claims his stepson asked to be tased to prove he wasn't a "mama's boy". He was hunting with his wife, who had a permit, but he was the one that shot the moose, without a permit. Obviously, it's a messy situation, and it's unclear exactly who did what to whom. But Palin's interest in Wooten's status as a state trooper is pretty justified considering the allegations against him, it shouldn't be surprising that she would bring it up, and it shouldn't be surprising that she disagreed with how the case was being handled.

The problem with holding government jobs, is that you are expected to completely separate your personal life from your professional life, which is virtually impossible to do. If you need to hire staff, and you worked with someone in the past that you think might be good for the job, hiring that person will be perceived as cronyism. If you received campaign contributions from a business, and you think that business would be particularly suited to some government contract, awarding that business with the contract is perceived as "pay-to-play". If you don't think your sister's no-good, abusive, poaching, racist ex-husband has any business being a state trooper, it's perceived as an abuse of power. Unlike a private enterprise, which has accountability built in (i.e. profits), accountability in government is makeshift and speculative.

Pop Quiz - Subject: China

2008-09-03T09:35:00.002-05:00

Let's test to see if everyone's been paying attention. Let's say a country has been been pumping money and credit into their economy in order to build infrastructure and fuel a growing economy. What is most likely to happen?
a) The economy will continue to grow as long as the government continues to supply credit
b) The economy will reach peak efficiency and maintain GDP levels regardless of how much credit the government supplies
c) The economy will go into a recession because the previous growth was based on malinvestments fueled by the government that do not reflect the populations needs and desires which will subsequently need to be liquidated.

Maybe some of you remember Man Cow's game show "The Answer is Always C", in which he would ask contestants a multiple choice question in which the answer was, in fact, always "C".

China's economy is DEFINITELY headed for a meltdown:

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/09/01/cnwfc101.xml

My favorite part of this article is this phrase right here:

"While the Communist Party is likely to keep injecting public money to keep headline growth rates rising respectably, the slowdown of demand for office and residential space shows that the Chinese miracle may not be sustainable indefinitely."

Number 1 - the injection of public money caused the bubble, which the recession will necessarily have to correct for.
Number 2 - there is a reason these booms are considered "miraculous", becuase they defy the conventions of economics and human action. They are, in fact, too good to be true.

What I love about this article is that the author touches on all of the critical pieces of information regarding a business cycle, but fails to put them all together in a coherent manner. Perhaps the author is simply being coy, and doesn't want to tip his hat to an economic theory that is regarded by manner as crackpottery.

For further reading on this, you might want to skim this article regarding the "Skyscraper Index". Apparently, skyscrapers are harbingers of economic doom. The only way you can build them is with easy credit. So the conditions that are a pre-requisite for a building a skyscraper are the same conditions that necessitate a recession:

http://mises.org/story/3038

America's Great Depression

2008-08-29T08:38:00.002-05:00

America's Great Depression - By Murray Rothbard

I have been reading the above for the last couple of weeks, and although it's been a pretty dry and difficult read at times, it will probably become one of my top ten favorite books, and represent a massive turning point in my general perspective on government and economics.

The reason this book has had such an influence on my perspective is two-fold.

First, for introducing me to Mises Theory of the Business Cycle, which basically states that government inflation (or bank inflation), which results in interest rates below the normal equilibrium, encourages overinvestment in capital resources. The increased investment fuels a boom of construction, development, and speculation; but without hard currency to back it up, the investments in total always lose money, which results in a recession.

Second, the events that Rothbard are describing are so earily similar to the events of today, and truly, the events of every recession (and the boom that preceeded it); that it is impossible not to marvel that this book was written 40 years ago about an event that took place 80 years ago.

From the artificially low interest rates (Fannie Mae & Freddie Mac), to the speculation in land and property (the housing boom of the 2000's), to the wasteful government programs trying to prop up food prices (ethanol), to the attempts to block oil exploration AND imports (energy independence, without the necessary drilling to make it possible), to the movements to block immigration in order to prop up wages ("Build the fence!"), to the massive government works programs to keep people employed (Alaska's bridge to nowhere), to the calls to socialize all industry in general, and the oil industry in particular (the recent congressional meetings with oil execs), to the massive outcry against speculation and short-selling (which is an exact duplication of what we hear from today's politicians), to the calls for the government to take responsibility for yet another formerly private enterprise (banks, unemployment benefits, utilities, health care).

What I find so fascinating is that in every recession, there seems to have been sound economists that were pointing out exactly what had happened, why it was happening, and how to fix it, and there are always some variety of "New" economists that grasp at straws to find some convoluted new theory that tries to retain the idea that an increased government role in the economy can ensure perpetual wealth and prevent recessions.

What is so unfortunate is that the proposed "fixes" of the mainstream, always aggravate the recession. Pumping more money into the economy and lowering interest rates always results in businesses holding investments instead of liquidating them, which means that new money goes into the same bad investments that the old money did. Public works, unemployment benefits, and employment laws all restrict the flow of labor from non-productive enterprises to more productive enterprises, directing the resources of the nation towards non-performing industries, and driving up the cost of labor in performing industries.

The real solutions are incredibly cold-hearted, and therefore, haven't been implemented since the 19th century when American leaders were still disposed towards freedom and limited government. Decrease government influence (whichever is greater, government taxation or government spending). Deregulate the economy to reduce the cost of doing business. Decrease unemployment benefits that prevent labor from rejoining the marketplace. End corporate welfare that props up unsound investments.

Long-term, the banking industry should be reformed in order to reduce the degree to which banks can inflate the monetary supply (potentially requiring a 100% reserve on all demand deposits). While many would regard this as a heavy-handed government interference, it can also be regarded as an essential protection of private property; considering banks are essentially allowed to lie to the public by providing monthly statements regarding how much money they have in their account, when in fact, that money has all been lent out to businesses, developers, and speculaters. Reduce the degree to which the Federal Reserve can inflate the monetary supply (probably by getting rid of it). Resort to a hard-currency which requires the government to balance the budget every year.

Whether one believes this will result in a better or a worse economy depends on how one defines those terms. I believe it would be better in that it would be a) more free and thereby more moral, b) growth would be more sustainable, c) it would prevent government largesse, and d) it would prevent future meddling in international affairs. Many think it would be worse in that the government would not be providing as broad a safety net as it does today, and it makes the potential for creating a perfect society impossible, because no one believes that the public can create a perfect society through their millions of self-interested decisions, but many still hold that the government can make a perfect, or at least a more perfect society, through central planning and regulation.

Medical Research

2008-08-26T13:02:00.002-05:00

Periodically I google the name "John Kanzius" to see how he's doing, and when he will begin testing his potentially revolutionary cancer treatment on human patients. I noticed that he is trying to come up with $10M to fund the testing. It got me thinking about our health care system in general, and R&D in particular.

My first question was, "Why is it so darn expensive?!" Well, there is equipment that needs to be built. Space that needs to be rented. Engineers, technicians, scientists, and doctors that need to be employed. Then there are the government regulations that need to be abided by in order to acheive the ultimate goal of an FDA-approved treatment. Then you've also got hundreds of regulatory safeguards that say, "such-and-such test must be administered by a licensed so-and-so". Licensed so-and-so's aren't always easy to come by; the licensing process creates a barrier to entry that limits supply which increases the costs of their time and expertise. Ultimately, it's a trade-off. The regulations protect us from dangerous treatments being introduced into the mainstream, but they also drastically inflate the costs.

My gut tells me that a lot of these costs probably outweigh the benefits, and it would generally be good for America if we could gut some of these barriers.

Another question is, "What entity is in the best position to pay for this?" I think I might have a pretty controversial answer: insurance companies. I haven't been able to figure out which insurance companies spend money on R&D, and if so, how much. But ultimately I think that insurance companies are in the best position to spend money on R&D.

The default response, unfortunately, seems to be that the government should do R&D, or at least be the principle funding mechanism. I'm not convinced this is correct for a variety of reasons. First of all, governments don't have the right incentives. Governments, are not results-oriented when it comes to spending programs. Certainly, some are better than others, but it is by shear force of will, because there is no natural mechanism to produce results. Governments do not have to be all that responsible with their money, so if a good friend happens to be chairman of a foundation for breast cancer research, then that foundation is much more likely to get funding than a foundation for diabetes research, regardless of which disease affects more Americans, regardless of which foundation is producing better results. In addition to the fact that a "better" foundation may not be getting funding, the "better" foundation will now have to spend more money on their R&D because the government has allocated precious resources elsewhere.

Some cynics have argued that hospitals and laboratories have a profit-motive, but not a cure motive. There is some truth here. Hospitals make money treating patients, not curing them. The problem is that customers still generally choose what hospital they will be treated at, and they care about things like results. Hospitals that cure more patients receive more patients. It is also true, however, that the unholy alliance of government-employer-insurer-hospital has created enourmous inefficiencies and disincentives, and I would conceed that this relationship waters down the customer-hospital relationship that should be driving lower costs and more cures.

Insurance companies are in a unique position. They are paid by their customers to pay for their treatment. It is in Blue Cross Blue Shield's best interest, for example, to find a cure for cancer. It is not in Blue Cross's best interest to perpetually spend money on treatments that don't work. Blue Cross would also have slightly different incentives in terms of intellectual property rights. Normally, companies that do R&D into new treatments have an incentive to protect their intellectual property, and to sell treatments at a premium to recoupe their investment costs. This is perfectly normal and healthy behavior because it ensures future advancements will be funded. Since advancements have been so rapid over the past 100 years, it has seemed like we are forever paying for intellectual property because the only treatments that consumers want are the latest and greatest treatment options, and those always come with a premium. Insurance companies also have an incentive to make a profit from their R&D, but they are equally motivated by cost-savings. What good does it do Blue Cross to charge hospitals a premium, only to have to pay them back when their customers are treated.

Georgia

2008-08-20T14:15:00.003-05:00

In case you've been living in a cave: Russia has established a military presence in Georgia, a US ally, and a former Soviet State.

If you haven't been living in a case, and you listen to the news, then you have probably heard that Russia invaded Georgia, violating her borders, and threatening her government in an unprecedented act of aggression to resurrect the Soviet Union and enslave the human race.

If you search multiple news sources, then you know that this is not the case.

Within Georgia is an autonomous region known as South Ossetia. This region has made repeated attempts to secede from Georgia, but has not been recognized as a sovereign nation by the civilized world. They consider themselves sovereign, but they have not been recognized as such.

Georgia send tanks and soldiers into South Ossetia's capital city to stop South Ossetia from shelling Georgian cities. South Ossetia was shelling Georgian cities because Georgian snipers were killing their soldiers. It's complicated. When Georgia decimated the capital city and killed Russian peacekeepers, the Russians responded with force.

Now virtually every politician and international organization is tripping over themselves to condemn this act of aggression. It's particularly amusing when it comes from politicians in the US. Hey, I support what we're doing in Iraq, but can we seriously condemn Russia's recent act of aggression when we have a military presence in a foreign country?

That, however, is not my point. I'm writing today because I wanted to describe my new 2-part foreign policy model:

1) "Stand up to your enemies; then reconcile when you have defeated them"

2) "Don't start World Wars over skirmishes in the Baltic States"

The second point shouldn't need to be explained, but point one deserves some clarification. When a foreign power is threatening your national security, your interests, and your sovereignty, it is prudent to take a firm and assertive posture. When you defeat your enemy, however, it is best not to rub their noses in it.

When we defeated Germany in WWI, we rubbed their noses in it. We penalized Germany much too harshly. We set in place the conditions for isolation and economic ruin. Perfect conditions for nationalist fanaticism.

When we defeated Saddam Hussein, we disbanded the army, we refused to work with tribal leaders, and we ousted anyone that actually knew what they were doing. We isolated these factions, and we ruined them economically. Perfect conditions for nationalist (or tribal, or religious) fanaticism.

The Soviet Union has been defeated. We had an opportunity to include them in the Global Market, but we allowed her resources to be pillaged and we ruined her economically. She has only now begun to make a comeback, and we cannot deny that there isn't a nationalist element to it. If we now isolate her from the international community and kick Medvedev out of the G-8, we will be fanning the flames of nationalist fanaticism.

COOL

2008-08-05T09:53:00.004-05:00

If you recall, I made some recommendations for how the U.S. can alleviate the economic downturn we are experiencing. While many of my suggestions came from a particular economic point of view, and would therefore be subject to dispute, one of them would have received universal acceptance, at least from an economic perspective. My recommendation was that government take steps to reduce the cost of doing business in the U.S. by eliminating regulations that do not produce a substantial benefit to society, but cost consumers a great deal of money. I didn't have a lot of examples at the time, but I have one now.

Apparently, the federal government has decided to take the opposite approach in at least one industry: food. To my understanding, a law was passed a few years ago and will finally be implemented next year. Since they love to come up with witty and clever names for expensive laws, this one is called COOL: Country of Origin Labeling.

What does it do? Well, you can read the 200+ pages of regulations, restrictions, and exemptions if you so desire, but in a nutshell it demands that all food items display a country of origin prominently on the consumer packaging. So, if you package frozen broccoli bought from Mexico, that package of broccoli must say, "Product of Mexico". Seems pretty benign, right?

Here's where it gets costly.

1) businesses need to pay lawyers to read the 200+ pages and turn the document into layman's terms.
2) businesses need to devote resources in label design, sourcing, packaging, quality assurance, and manufacturing to understand the new law, to determine action that has to be taken, and to implement the changes.
3) businesses need to invest in any number of the following design work, labels, new packaging, and/or new machinery.

The preceding are guaranteed to be costs associated with every business in the food industry. The following are potential risks based on how businesses find solutions to the new guidelines.

4) If a business cannot come to an acceptable solution for stickering or printing on existing packaging, that packaging will become obsolete and will need to be destroyed.
5) If businesses incorporate the country of origin into the label design, they will need to create multiple versions of the same label for every potential source. If, for instance, you buy potatoes from Canada and the U.S., then you will potentially need two labels, "Product of USA", and "Product of Canada". That will mean twice the packaging inventory.

Now there are a lot of exemptions and clever ways that businesses can meet the minimum requirements. If you buy potatoes from the US and Canada, for instance. You can combine all your potatoes before you process them, that way you can sticker or print, "Product of USA & Canada". We actually sell nuts that list 3 or 4 countries on the package. My assumption is that they probably mix the nuts of multiple countries to get more consistent quality (since different regions may yield slightly different sizes and flavors depending on soil, length of season, temperature, and rainfall). If you package food blends (e.g. peas and carrots, stir fry blend, California blend) then you don't have to print or sticker the COO on these products. But that raises the question, "If it's really not that big of a deal whether you know where your broccoli & cauliflower come from when they come in the same bag, why does it matter where they come from if they are in separate bags?"

Worst case scenario, the actual design of the package will need to be changed, manufacturers will need to spend more money segregating their product by COO, surplus packaging will be destroyed and written off, and multiple versions of the same package will need to be produced and inventoried.

Best case scenario, manufacturers will need to track the country of origin of bulk product, and will need to invest in machinery that can print or sticker the appropriate country of origin on the package as product is packed.

For those of you that don't work in manufacturing, you probably don't realize how much things like this cost. When laws were passed demanding trans fat be displayed on packaging, my company spent untold thousands of dollars on design, printing, transportation, and destruction of existing packaging. For what? So you could be assured that the can of green beans you were buying contained 0g trans fat. As if it would have been anything else.

All of this is done in the name of "consumer choice". I, for one, would prefer to choose a bigger merit increase this year instead of forcing my company to pour money down the drain accommodating wasteful legislation. I, for one, would prefer to reduce my grocery budget, which is increasing at an alarming rate, than SOMETIMES know what country my food comes from.

We aren't really free

2008-07-30T12:19:00.003-05:00

We tend to think of America as being a generally free market. We think of housing as being part of this free market and road construction as being a controlled market. We are dealing, however, with superficialities. There are thousands of regulations, tax penalties, tax incentives, standards, zoning laws, etc., etc., etc., that really stand between America's current business system and a real free market.

Here's an article about our recent economic troubles. It starts as a critique of an article published by Paul Krugman, then goes on to explain what's really going on. Long story short, you can't blame free markets as long as the government is manipulating the banking system and the money supply. You can certainly blame the market in its current form, but you can't blame free markets in general.

http://mises.org/story/3046

Overdub 2008-07-30 12:42
After having read the Paul Krugman article in the New York Times, I have to add a few comments.

1) While I wouldn't say that low health care premiums would lead to a "boom" because there are different definitions of what constitutes a "boom". I WOULD say that lowering costs in ANY industry ANYWHERE promotes a higher standard of living.

The author of the Mises article already pointed out that Clinton's reforms wouldn't have necessarily reduced costs. I would add that Republicans made similar attempts to reform health care by limiting physicians' liability to lawsuits in order to lower health care costs, which Democrats blocked.

Ultimately, lower health care premiums can lead to greater employment, but so can separating health insurance from employment altogether. If employers didn't have to pay for health care at all, they could afford to hire even MORE people. This kind of argument could be used in favor of socialized medecine and consumer driven medecine.

2) According to Krugman, high energy costs are slowing down our economy. His solution? We should have raised energy costs (via taxation) earlier. How does that work? If high energy costs are slowing the economy, then raising taxes 8 years ago would have provoked this recession 8 years ago. If promoting fuel efficient technology was his goal, then today's recession is doing exactly what he wanted it to do 8 years ago. What difference does the timing make? If low gas prices were a "problem", then can't we pin the blame for vehicles like the Ford Excursion squarely on the Clinton Administration who presided over $.98/gallon gas prices?

Brilliant!

2008-07-28T12:53:00.002-05:00

I can't recall if I mentioned this or not, but I've talked about this with people in conversations. If supply is what's keeping oil prices high, then drilling will eventually increase supply, and decrease prices. If speculation is keeping oil prices high (which it is, in part, but I believe as an effect of growing demand and static supply) then opening up reserves to drilling in the US will result in the POTENTIAL for increased supplies, which will cause speculators to lower their speculative prices.

However, there is reason to believe that opening up reserves to drilling in the US will ALSO increase supply.

http://mises.org/story/3047

The logic is simple. If prices are expected to continue to rise, OPEC has an incentive to sit on as much oil as they can in order to sell it at a higher price next year. American companies have a hard time doing this because they aren't able to effectively collude (at least not legally). If, however, the US opens it's reserves, then OPEC has an incentive to sell more oil at todays prices before the US opens up.

America's Great Depression

2008-07-25T14:26:00.002-05:00

"America's Great Depression", by Murray Rothbard
http://mises.org/rothbard/agd.pdf

The book is not a historical narrative, it is an economic analysis of the business cycle in general, and the Great Depression in particular. The business cycle is perplexing to economists. While they can usually point to a handful of causes of depressions in particular industries (a late freeze that wipes out a harvest of strawberries, for instance), they find it difficult to explain why an entire economy would flourish, only to collapse into recession. Why does it affect the entire economy? Why is it always preceded by a boom? Why does it always result in a bust? Why is it so difficult for businesses to predict? Is it a fatal flaw in the market?

Rothbard's answer is simple, but the explanation is complex. In short, the business cycle is created by credit expansion and monetary inflation. When governments or banks issue credit at artificially low interest rates a boom of activity is created by the influx of money; however, when the dollars have been spent, and now must make a profit, they find that the consumers do not have enough wealth saved up to pay off the loans, either directly or by consuming the products that businesses invested in. Sound familiar?

Written 40 years ago, this book is truer today than it was then, adding to the veracity of Mises Theory of the Business Cycle.

For those of you expecting an echo chamber for either Lord Keynes or Milton Friedman, you will not find it here. The Austrian School of Economics is one of the few, if not the only, economic school that finds the bust to be a necessary correction, and the boom that preceeded it a repugnant malinvestment. Unlike supply-side economists that believe a boom can be sustained indefinitely by pumping credit into the production sector, and unlike demand-side economists that believe a boom can be sustained indefinitely by pumping credit into the consumption sector, Rothbard and the Austrian School of Economics believe that booms can never be sustained and should be avoided. Booms are created by credit expansion, and the greater the expansion, the greater the bust that MUST follow it. The faster you allow the bust to run its course, the faster you can put sensible economic policies in place that produce real, sustainable economic growth.

More Tinkering

2008-07-24T09:50:00.004-05:00

Whenever there is a bust, the knee-jerk reaction is, "The free market screwed up because people are dumb and greedy." What we usually fail to take into account is that the market is NOT entirely free and unhampered, and we rarely review the ways that we are already tinkering with the market.

Thomas Sowell has been writing about zoning restrictions and programs encouraging lending to folks with low-incomes, which is a form of government tinkering.

However, the government tinkers with the market in a much more fundamental way.

I assume you have all heard of the term "bank run". This is what happens when customers lose faith in their bank, and they all try to withraw their funds at the same time. These are moments in history when the man behind the curtain is revealed, and we are shocked to discover that the wizard does not hold the power he claims. The reality is that my money is not really in my bank. Someone else has it. My bank may have lent it to someone to buy a house, or start a business. They hope to get it back eventually, but there is no guarantee. When banks behave irresponsibly, and their investments fail, consumers catch wind of what's happening, they become concerned about their life savings, and they make a run on the bank. Bank runs are the markets punishment for malinvestment. The government does not like bank runs. So, they have gone to great lengths to discourage bank runs and insulate banks from bad investments. Most businesses are allowed to fail when they make bad investments. Banks belong to a privileged protected class.

The result, as always, is predictable. Banks engage in riskier behavior than they otherwise would because they are insulated from consequences. As I mentioned in my last post. You can take GREED for granted as a part of human nature; RISK, however, is a product of environment.

In general, the market punishes the risky banks through bank runs, and rewards the banks that provide real returns for their customers money. The market could encourage conservative investments by making runs on the banks, but the government doesn't like this approach. Alternatively, the government could change regulations (I do believe, after all, in some government regulations; I'm a conservative/libertarian, not an anarchist). Banks could be required, for instance, to keep a higher percentage of cash on hand for non-interest bearing accounts. This would contract the supply of money available and encourage more conservative investments. I think a better approach would be to require the banks to be more transparent. Customers should know what percentage of cash banks have on hand. Customers should know the risks they are taking. Risk-averse customers could put their life-savings into banks that retain higher cash reserves and engage in more conservative investments.

Neither political party is willing to travel this road because Republicans are convinced that a boom can be sustained indefinitely by expanding capital to investers (supply side) and Democrats are convinced that a boom can be sustained by expanding capital to consumers (demand side). Neither are interested in the slow sustainable growth that results from a hard currency and tight (or at least transparent) credit. Unemployment is always too high. Government spending is always too low. The McMansion on the sand is always preferred to the Split-Level on the rock. After all, the floods and the rains don't come every day, so we always seem to have time to rebuild.

Real Estate

2008-07-23T11:06:00.003-05:00

The government is largely responsible for the real estate boom and bust.

The government wants a blank check for welfare and warfare spending. They tax some of it, some of it they borrow, and the rest they inflate by lending easy credit.

The government wanted everybody to own their own home. So they created Fannie Mae and Freddie Mac. They gave them government support, easy credit, tax incentives, and power. Not surprisingly, these two institutions did not behave responsibily with the money they didn't earn and weren't accountable for. They created bad loans and told banks, lenders, and brokers to go out and sell them. The banks, lenders, and brokers of the world knew an easy dollar when they saw one, and they knew that if they didn't sell the loans, their competitors would. So they sold them. Unqualified borrowers, seeing potentially the only opportunity they would ever get to buy the house they always dreamed of, took the loans.

But reality catches up. The whole thing was built on a house of cards. The money wasn't real. The loans were bad. The master returned and demanded an accounting. No one had the money to pay up.

The problem is not greed. Everyone is greedy. Borrowers, lenders, and governments. Greed does not cause a person to take risky behavior. There are as many greedy misers as venture capitalists. The problem with the housing market bust was risk. Risk is not the foregone conclusion of greed. In this case, Fannie Mae and Freddie Mac engaged in risky behavior because the money was not theirs, and they were insulated from negative consequences.

When you have to work for the money that you lend, you are much more likely to lend it conservatively. When you get it at ridiculously low interest rates from the government, you are more likely to lend it recklessly.

http://mises.org/story/3053
http://mises.org/story/3045
http://mises.org/story/2936
http://www.townhall.com/columnists/ThomasSowell/2008/07/22/bankrupt_exploiters
http://www.townhall.com/columnists/ThomasSowell/2008/07/23/bankrupt_exploiters_part_ii

The problem with our current situation is that no one is willing to accept the solution. Let the market crash. Make lenders earn the money they lend. If you want to buy a home, you will only be able to buy a home that is 100 - 150% of your annual income, you will need at least 6 months of reserves, you will need a 20% downpayment. If you don't have savings, you rent. If you don't make enough money, you rent. If you live in a bad neighborhood where banks are unwilling to risk their investment, you rent. It's cold. It's slow. It's not modern. It's uncaring. It's sensible. No one will ever support it.

My Economic Solutions

2008-07-14T12:56:00.003-05:00

#1 - Don't bail out lenders.

-Housing prices suck right now... for owners. Not for buyers. Buyers are getting a great deal on a home. They could be getting an even better deal, but sellers aren't willing to drop their prices to the point that the market will allow. Foreclosures aren't being sold. Why? Because banks aren't willing to unload their assets at a loss. Eventually, they will. What will happen when they do? Prices will tank again. Will this be bad? For some. But think about it like this. Let's say you own your own home, and you would have to sell the house at a $20K loss to unload it, which might mean paying $10K out of pocket to your bank. Let's also say that a house that cost $300K in 2006 only costs $200K. If you could pony up the dough, would you take the loss to get yourself into a bigger home at a good price? I would. This doesn't work for everyone, but modest homes are seeing modest drops in price while massive homes are taking massive drops in price. This would create a good scenario for modest homeowners to move into bigger houses, and renters to move into modest houses.

#2 - Let the oil companies drill

Giving oil companies access to oil reserves so they can drill (or scoop, as is the case in shale oil) doesn't hurt anybody. In fact, it helps just about everybody. Even if it doesn't lower gas prices by $.01 it is still good for the economy. These rigs will need to be built, operated, and maintained which means jobs, jobs, and more jobs. Unlike the alternative fuel pipe dreams that only the govenrment is willing to throw money at, oil rigs won't cost the government a dime because oil companies (which have "record profits") will be able to build these rigs, potentially without even borrowing the money.

#3 - Reduce costs by eliminating restrictions

I don't know if you all know this, but there are lots of laws. More often than not, laws create waste. Some of that waste is good. It's good that food growers inpect their food. Laws that protect the consumer are often times pretty good laws. But not all the waste is good waste. In robust economic times, these laws make sense. They don't always make sense when the economy is in the tank. For instance, why do different parts of the country have different requirements for fuel mixtures? Why don't we standardize the mixture so that refineries don't ever have to do line changes. Another, more controversial, example would be minimum wage laws. Nobody wants to be paid minimum wage, but if the trade-off is low-pay vs. no-pay, most people would prefer low-pay.

#4 - Lower taxes, cut spending

In more robust economic times, we can afford to throw money at things that are not very productive. We can afford to tool around with ethanol when times are good. When food prices are skyrocketing, we should probably think about letting people keep the money they make so they can buy groceries. This cuts both ways, however. When times are good, we can afford to spend hundreds of billions of dollars so the Air Force can have new military air-tankers. When times are not so good, we should really think about making due with the ones we have. Do we really need to maintain military bases in Germany anymore? How about we let the Germans take care of themselves? Tightening a budget is not painless, but in tough economic times, it has to be done. If you are a Keynesian and think that the government can spend it's way out of every financial mess, then we can agree to disagree. I believe that government spending directs resources to unproductive enterprises, and when the budget isn't balanced it leads to inflation that robs the dollar of its worth and leads to exaggerated boom-bust cycles. I'm also going to go out on a limb here and say that the problem with the United States of America is NOT that we don't consume enough. As evidenced by the recent credit problems our nation has faced, the problem with the U S of A is that it doesn't save anything.

DIYDS

2008-07-02T08:53:00.004-05:00

Most of you are familiar with the term DIY (Do It Yourself). I like to think of myself as an extreme-DIY; I don't just replace a light switch plates, I cut out a chunk of drywall, re-run the wiring, install a new light fixture, and replace the drywall. Sometimes, however, I start projects that I have no idea how I'm going to finish until I actually get started. I read instructions, I get help off the internet, but otherwise I have no prior experience in whatever-it-is-that-I'm-doing.

When a person attempts a project that they have no idea how to do beforehand, they more or less make it up as they go, and the primary reason why they didn't call a professional is that they are too cheap to pay for it, I call these projects DIYDS.

Do It Your-Damn-Self

Neither Militia nor Criminal

2008-06-30T09:52:00.002-05:00

I could not be happier to see that the Supreme Court found that the 2nd Ammendment indeed applies to an individual right to keep and bear arms for traditionaly lawful purposes (e.g., sport, hunting, and self-defense).

Considering the statements that have either been written or spoken by virtually every contributor to the Declaration of Independence and the Constitution, particularly Thomas Jefferson (the supposed founder of the Democratic Party), who thought that hunting was a superior sport to all others, and thought that one ought to use a rifle as a walking stick when hiking in the woods, I have no doubt in my mind that the contributors intended the 2nd Ammendment to preserve the right of the individual to keep and bear arms.

The 2nd Ammendment is as follows:

"A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed."

The argument against the individual right to keep and bear arms is more or less as follows:

1) The purpose of the 2nd Ammendment was to preserve the rights of state militia's to keep and bear arms to preserve the security and authority of the individual states.
2) Since militia's are no longer used, and have been replaced by standing armies.
3) The 2nd Ammendment no longer restrains local, state, or Federal legislators.

Scalia argued that while the 2nd Ammendment states A purpose, it does not restrain gun ownership to that singular purpose. Basically, the argument is that just because the writers of the constitution sited militia's as an important reason not to infringe on the people's (i.e. the individuals) right to keep and bear arms, this does not mean that arms were protected solely for the use of militias and for no other purpose. If Scalia's argument is not followed, the only alternative is to essentially remove the 2nd Ammendment entirely. If arms are only protected in militias, and there are no militias, then the 2nd Ammendment is essentially null and void and offers no restraints on Congress and offers no protections to the American people.

I think if you look at the other side of the coin you can see more plainly what's being argued. I freely admit that this is a strawman, but I think it's a good illustration nonetheless. Let's say you have a law that states the following:
"Since murders are usually committed using firearms, the sale and possession of firearms shall be prohibited."
If you follow Justice Stephen's line of reasoning, it could be argued that the sale or possession of a firearm is only illegal if the firearm is used to commit murder.
If you follow Justice Scalia's line of reasoning, you would conclude that just because the purpose of the law was to prevent murder, doesn't mean that the law does not apply to those that aren't intending to commit murder.

So... to Justic Stephens' argument that the purpose of the 2nd Ammendment was to preserve the state militia, then my response would be this, "When such a time arises that my state calls me into service, my weapon will be well-maintained, and I will be well-practiced."

Aborion: Faith, Belief, Value?

2008-06-24T12:11:00.002-05:00

Why are Christians (including Catholics) opposed to abortion? Without citing any sources, I would venture to say that most Christians that oppose abortion would claim the following:

1) God cares about human life and has stated that it is against His Will to willfully take the life of another except in self-defense.
2) Scripture states and science confirms that human embryos are both human and alive
Therefore...
3) Abortion is the willful taking of a human life and contrary to God's Will.

There is no passage in scripture that states, "Thou shalt not kill the fruit of they womb". Christians come to the conclusion that abortion is wrong by way of determining that murdering human life is wrong, and unborn babies are both human and alive.

The passage that most closely approximates a prohibition on abortion is the following:

Exodus 21:22 - 25
22 "If men who are fighting hit a pregnant woman and she gives birth prematurely but there is no serious injury, the offender must be fined whatever the woman's husband demands and the court allows. 23 But if there is serious injury, you are to take life for life, 24 eye for eye, tooth for tooth, hand for hand, foot for foot, 25 burn for burn, wound for wound, bruise for bruise.

Essentially, this passage implies that abortion (in this case accidental) carries the same gravity as murder, and should be punished in the same way. If the punishment for causing miscarriage or stillbirth were a fine, we could conclude that while abortion is wrong, it's not AS wrong as murder.

However, there is no passage that is totally airtight. One could argue that the preceeding passage doesn't cover instances where the mother intentionally aborted the child, which is a different scenario than another accidentally aborting the child. An abortion supporter could make the argument that it was wrong because the mother WANTED the child, and not because the child was of some inherent value (ie, a human life).

What's the point of all this? In my opinion, politicians that say "I am personally opposed to abortion on religious grounds, but I am not willing to impose my religious beliefs on others through the law," are either ignorant as to why they oppose abortion, they do not really oppose abortion (ie they are disingenuous), or they are afraid to stand up for what they believe to be right because it would not be politically expedient (ie they are cowards).

Ignorant: Opposition to abortion is not simply a religious belief. Since there is no clear instruction against abortion in the Bible, the only way of intelligently coming to the conclusion that abortion is wrong is by following the procedure outlined above. One cannot rightly say, "Well, the Bible says abortion is wrong, but it also says eating pork is wrong, and we don't legislate against that." The Bible does not say that abortion is "wrong" or that abortion is "sin", the Bible implies that abortion is murder. Certainly, one can think abortion is wrong because they were taught it was wrong by their parents or their church, but that is not an intelligent way of determining one's personal value system. There are plenty of people that do this, but these people are ignorant as to why they believe what they do. For these people that do not think through what they believe, it is easy to say, "This is my personal belief, but I won't impose it on anyone else", because it's not true. It's not their personal belief, it's someone else's personal belief that they have adopted but they have no idea why. When politicians, like Barak Obama, for instance, say that they are personally opposed to abortion, I would be very curious to find out why that is. Unfortunately, I am not aware of any time where a politician who is pro-choice, but personally opposed to abortion, has been asked, "Why are you opposed to abortion?"

Disingenuous: If one fully appreciates what it means to be opposed to abortion, and understands that the only way to truly oppose abortion is to consider it murder, and this person persists in stating, "While I am personally opposed to abortion..." then I would conclude that this person does not really believe that embryos are human life, and does not really believe that abortion is murder. If one believes that abortion is murder, and the state has no authority to legislate abortion, then one must also conclude that the state has no authority to legislate murder.

Coward: If one has intelligently and genuinely come to the conclusion that abortion is wrong because abortion is murder, and one believes that the state has the authority to legislate murder, and one still persists in stating, "While I am personally opposed to abortion..." then I would conclude that this person is simply afraid to stand up for what is right.

Of those who are firmly pro-choice, who do not believe there is any difference between removing a tumor and removing a fetus, I can say that their stance is thoughtful, genuine, and, to a certain extent, courageous. I cannot say the same for those that claim they are personally opposed to abortion but do not support the state's right to protect the unborn. They might as well say they oppose slavery, but don't believe the state has the right to abolish slavery.

I can't fathom this

2008-06-19T14:29:00.002-05:00

Is there any reason not to allow oil companies to drill other than, how I see it, resentment politics.

If you aren't familiar with resentment politics, it's fairly simple: a certain policy is either supported or rejected, not because it will yield a more just society or a more successful society, but because it hurts people we don't like.

There is nothing in politics I hate more than resentment politics. Provoking strife between classes, genders, and races is an easy way to score political points, but it creates massive barriers to progress.

Oil drilling is one of them. The only argument I have heard against oil drilling has been that it will help oil companies.

True, some folks have argued that drilling won't "solve our energy problems", but that's not really an argument against drilling. Just because drilling won't "solve" all of our energy problems, doesn't mean it won't help.

Some folks have argued that "alternative energy" should be pursued, but our government isn't a position to choose either drilling or alternative energy, they can choose both: oil companies would foot the bill for drilling, taxpayers foot the bill for developing alternative energies because at this point they aren't productive or profitable.

Some folks have argued that our oil supply is only 3% of global supply... which still isn't an argument against drilling, and it doesn't really mean anything, because I've also heard that that 3% of global supply is enough to satisfy our oil needs for 100 years. I've heard the argument that our drilling is safe and won't spill, a preemptive attack against environmental arguments, but I've not actually heard anyone argue that drilling is environmentally unsound.

These are all arguments that we should pursue some other course, or that the benefits won't be worth the costs, but no one has found the time to point out what those "costs" are, and why we are to deem them as being too high. There's a good reason for that: the costs are very low to the American taxpayer.

Even the argument that speculation is the real cause behind high prices at the pump is not an argument AGAINST drilling, it is an argument for the government to take action against speculators IN ADDITION TO whatever is decided about drilling, which is really a totally separate issue. Personally, if SPECULATION is really the cause of the price increases, and that speculation has fluctuated greatly because of supply concerns about Middle Eastern Oil, then the mere ANNOUNCEMENT of the relaxation of the moratorium on oil exploration should make an immediate impact on the futures price of oil.

The ONLY argument I've heard AGAINST drilling is that it will help "Big Oil". It doesn't matter that what helps Big Oil also helps the American consumer, so long as any policy helps Big Oil in any way it will be wholeheartedly opposed: that is resentment politics.

Hydraulic Hybrids

2008-06-04T08:49:00.002-05:00

Check this article about new technology for trucks. The technology needs some work before it could be applied to cars.

Some of the major positives of this technology: it's a lot cheaper, and a lot easier to recycle or dispose of than batteries, it's allegedly more efficient at capturing braking energy than batteries are.

This is also another example of how, contrary to what many Americans believe, our world's economy is not being manipulated by Big Oil, or Big Medecine, or the Illuminati; it's being manipulated by the Dutch. Or maybe you didn't catch the part about Bosch Rexroth being at the forefront of this technology. For those of you that don't know, while Bosch is based in Mt. Prospect, IL, the name Bosch is Dutch. And who is the expert that the article quotes? James Van de Ven. Here you all are, reading this post, trying to think of where Denmark is, and how such a little country could possibly be controlling the world's governments behind the scene. That's just how they like it.

Before you post anything... I'm fully aware that the Dutch are from the Netherlands. I was totally going to post this video that I got from Oneway of a man protesting Denmark and "the Dutch" for the cartoon depicting Mohammed with a turban bomb, but I couldn't find the video. Rest assured, it's hilarious.

Worldviews

2008-05-06T11:04:00.002-05:00

I was driving home from the work the other day listening to a Christian Radio show. I don't typically listen to it, but this day I was.

The two hosts (one I presume was a guest host) were talking about gang violence that left 9 people dead in the city of Chicago in April. The two hosts were talking about the tragedy, about gun violence, and one of the hosts said something along the lines of, "Let me say something else that may be a bit controversial: I think the cops know where the guns are." The other host didn't really comment on this, his response was a sort of a I-can't-really-agree-or-disagree kind of response. A couple minutes later a woman called the show and said a number of things. 1st, she said that she thought the cops knew who the drug dealers were, but didn't really do much to stop it; 2nd, she couldn't say whether the host was right in his assertion that the cops "knew where the guns were"; and 3rd, the young men involved in the shootings were being oppressed by evil spirits and need prayer. The host readily agreed with everything the caller had to say.

Here's my issue: in the span of about 5 minutes the host and the caller both blamed the police for the violence because of their inaction, and portrayed the gang members that murdered these 9 people as victims deserving sympathy.

If you want my personal point of view (which you do, otherwise you wouldn't be reading this), I think that Satan and his minions are much less preoccupied with tempting gang members and killing 9 people than they are with promoting a perversion of God's Grace to be accepted by an entire generation. The gospel message is that we are all deserving of eternal condemnation because of our willful sinful disobedience, and it is the Grace of God that extended us an opportunity to be saved from our own sinfulness through Christ's sacrifice. It is Satan that would like us to believe that we are victims of society, of poor parenting, of genetic deficiencies, or of spiritual oppression, and that because our sin is not our fault, we are not deserving of condemnation. The mentality is that we are victims, and as victims we deserve to be saved because our situation is not "our fault".

There are times when we forget that we are ALL sinful and undeserving of God's Grace, and it is then that we ought to be reminded that we are no better than those gang-bangers because we all reject God's commands. However, just because we are all sinners doesn't mean that no one is guilty and no one is deserving of judgment. We cannot use the "everyone is doing it" (or the "everyone is a sinner") argument to excuse any kind of destructive behavior. We do a disservice to God's Just and Righteous character by minimizing his hatred of evil.

Let me also say I'm not trying to cast aspersions on the radio host or the caller. I'm sure they are intelligent God-fearing people and they are probably both theologically sound. However, their conversation contained elements that I wanted to use to illustrate a point.

Economic Stimulus

2008-04-30T13:15:00.002-05:00

While the Democrats and Republicans are hopeful that you will cash your economic stimulus check and spend it on a new car, or new living room furniture, I have a better idea.

With so many financial institutions in trouble these days, I think the best use of this package would be for all of us to make generous donations to the financial institutions of America. In other words, rather than buying more crap you don't need, pay for the crap you don't need that you already have: pay down your debt.

The Political Pulpit

2008-03-14T10:00:00.002-05:00

The last couple of days the newstalk circuits have been discussing some of Rev. Jeremiah Wright's comments during sermons preached at Trinity United Church of Christ. I am not as interested in what Rev. Wright said as I am the issue of political speach from the pulpit.

Jerry Agar, on AM WLS, was discussing the current tax laws that essentially give churches an ultimatum: stay out of politics or pay taxes. Agar is taking the position that the tax laws are unfair, and they essentially put a price on free speech. Rather than silencing opposition by force, as happens in China, Venezuela, or Cuba, the United States has chosen to silence the church through a subtle kind of bribery. If a church decides to participate in the political discussion, they taxed.

A caller to the radio show stated that a pastor ought to have a right to say whatever they want in public, but she would be offended if a pastor tried to tell her how to vote, so she concluded that the law was appropriate. I'm sorry, but has America completely lost it's grasp of the concept of personal liberty? The question is NOT, "Do you think pastors should support particular candidates?" The question is, "Should the GOVERNMENT be interfering in what is said from the pulpit?" The Government is clearly offering incentives and disincentives to churches to affect what is and is not said from the pulpit. Is this appropriate? Is this constitutional?

Entirely too often I hear the argument of the caller: "Well, I don't think it's right for a pastor to tell the congregation how they should vote." I'm really glad that YOU don't think it's right, but why in heaven's name have you allowed the GOVERNMENT to determine what is acceptable and not acceptable.

Aside from the obvious violation of free speech, and a clear violation of the separation of church and state. This is an extraordinarily dangerous precedent. I have used this argument a dozen times for different issues, and it is no less significant in this case. What happens when a particularly illiberal politician decides that non-profit organizations should lose their tax-exempt status if they engage in "hate speech"? My presumption is that most of American society will march along like sheep to the slaughter and hail the decision. The reality is that such legislation will turn any church that preaches a biblical stance on homosexuality into a "hate organization", and they will lose their tax exempt status. Right now a church has to make a pretty specific statement regarding support for a particular candidate or particular legislation. But what happens if churches lose their tax exempt status for opposing abortion?

It is a mistake to think that just because a particular law doesn't affect us, that subsequent laws will not. When we allow precident such as this, we open the door to further government interference and potentially outright tyranny.

What is our energy priority?

2008-03-06T13:39:00.002-06:00

Energy is a major issue this year in politics and industry. Gas prices are going through the roof, and with them, all other consumer goods. As much as we talk about energy and energy policy, we don't seem to be gaining any clarity on the issue whatsoever. So here is my attempt to provide some clarity by asking the following question: what is our priority? We seem to have lots of "problems", and each of those "problems" have vastly different solutions. So, what we need to do is prioritize. So, here are our problems, in no particular order (actually, they are probably in the order that I prioritize them). I will try not to add commentary until the end.

Problem #1 - The price of gas is approaching $4.00/gallon which is making it more and more difficult for low and middle class families to make ends meet. Should lowering the price of gas be our priority?

Solution #1 - If lowering the price of gas is our priority, then we should build more refineries. The Federal government should standardize legislation regarding fuel mixtures so that fuel produced for Illinois can also be sold to Wisconsin and Indiana and Michigan. This is one of the few cases where I think the Fed SHOULD intervene under the commerce clause; but, of course, they haven't. We should drill for oil off the coast of Florida, and California, and we should drill in Alaska. An increased oil supply will not, however, solve anything unless we expand our refinery capacity, which is bottle-necking our supply and artificially raising prices. We should take efforts to strengthen the dollar so that $1US is able to buy more foreign oil than it does today.

Problem #2 - We are supporting dictators and terror-sponsors by buying oil from them and putting our national security in the hands of volatile governments because of our dependence on foreign oil.

Solution #2 - See Solution #1. There is more than enough oil in the Western Hemisphere to supply all of the Western Hemisphere's needs, but we are not drilling for it. Canada alone has more oil than Saudi Arabia, but it is more expensive to collect and refine (you don't drill for oil in Canada, you scoop it up and separate it from the sand, which is a pricey process). So, if energy independence is our priority, and an issue of national security, then we can subsidize domestic drilling and refining, place heavy tariffs on foreign oil, promote the use of domestic oil through propoganda, and legislate that gas stations label their pumps with countries of origin.

Problem #3 - Our energy production is polluting the environment, and CO2 emmissions especially are adversely affecting our global climate.

Solution #3 - Build nuclear power plants. Water vapor is the only emmission from a nuclear power plant, and nuclear waste is concentrated and contained. I had an additional thought that we might be able to decommission some of our nuclear arsenal to create nuclear energy, I was even thinking it could have a witty slogan like "weapons to fuel" or "bombs to energy" or "bombs to bulbs" or something like that. That would make electric energy "clean" energy (especially in terms of carbon emmissions). Of course, we can build windmills and hydroelectric dams, and solar power plants, and we could subsidize the use of solar panels. We can build up our public transportation infrastructure by building more subways and elevated trains run off the power grid. Lastly, we can subsidize the use of electric cars, especially the commuter cars that have recently been introduced that run off of electricity first, then switch on a gasoline engine once the batteries have depleted to a certain point.

Problem #4 - Oil is a relatively fixed resource, and even through there is a lot of it, once we have depleted it, it is gone.

Solution #4 - Solar, wind, and water energy are potential solutions for electric energy, though it's not likely to supply all of our electric needs until there are substantial improvements in the technology, and these won't run cars. Hydrogen could be considered renewable so long as the electric power used to separate water into Hydrogen and Oxygen is produced by hydroelectric dams, windmills, or solar panels. Even though it is a net energy loser, we would be converting renewable energy (like wind) into a transportable energy, and that transporatable energy has economic value that would be worth the net loss of energy. Ethanol is also a net energy loser, so it can only be considered renewable energy if the energy we use to create it comes from the sun, the wind, or water.

So, what is our energy policy today? What are we doing to lower the price of fuel? What are we doing to make ourselves energy independent? What are we doing to reduce polution? What are we doing to use renewable energies? Ethanol.

The federal government has been subsidizing Ethanol which is somehow marketed as the solution to all our problems.

The reality is that ethanol does not solve ANY of our problems; in fact, it's not even a step in the right direction.

It's not going to lower your gas bill: it is only a competitive fuel source when it is heavily subsidized by the government, which means that we are paying the government instead of paying at the pump. It can't be transported in a pipeline, which means we have to use trucks, which are expensive and crowd our highways. The acreage we are using to produce ethanol is driving up food prices. If you haven't noticed it yet, you will. At a recent food convention I spoke with a wide variety of growers, and their raw product costs are going up 50 - 100%, and every single one of them blamed (in part) ethanol subsidies. While ethanol is cheaper per gallon at the pump (because it is so heavily subsidized), it is a less efficient fuel, which means that your loss in fuel economy will offset your savings per gallon. So essentially, we are paying for ethanol on April 15th, we are paying for ethanol in the grocery store, and we are still not saving one red cent at the gas pump.

Ethanol is also not a viable solution to energy independence. There is not enough corn in the Western Hemisphere to both feed the people and power their cars. I haven't looked very closely at this because the economic damage we are doing should be enough to make us say, "Uncle", but I imagine there is probably some minute reduction in our need for foreign oil since some of the energy to produce ethanol must be coming from the grid, and not foreign oil. Ultimately, the only way we will be totally energy independent (or at least not dependent on the middle east) is if we increase our use of Canadian oil and drill in the Gulf, off the coast of California, and in Alaska. Ethanol will help, but it will not prevent the dreaded drilling in ANWAR, and it comes with severe economic disadvantages. So, if we are using ethanol as an alternative to drilling, but we are going to have to drill anyway, then why use ethanol?

Ethanol is not green. I don't care what Chevy, or Ford, or corn farmers, or anyone else tells you. We are burning coal and oil to make it, and the green house gases that are produced from ethanol are equal to, if not greater than that of regular unleaded gasoline. So, the total impact of ethanol will result in more pollution, not less. Regular unleaded gasoline is greener than ethanol, end of story.

Ethanol is only renewable if it is produced totally on the grid, which it is not; and even if it were, there wouldn't be enough to go around. So, scratch ethanol as a viable renewable fuel source.

So, the next time you hear mention of an energy policy, ask two questions: what problem is this going to solve? Is this problem our most pressing concern?

Surprisingly, I don't have a problem with this

2008-02-18T13:04:00.002-06:00

http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2006/11/29/nsharia29.xml

As the subject reads, I don't really have a problem with the above link. Personally, I agree with the Apostle Paul who was apalled to find out that Christians were sueing eachother in Roman courts. I believe that whenever possible, two committed Christians attending the same church ought to settle disputes under the authority of the church, or find a Christian arbitter that can settle a dispute. Of course, if a suitable compromise cannot be found, then either party has every right to take the matter to a civil court. There obviously ought to be certain limitations to this, but I think it's totally acceptable under many instances. So long as these courts are otherwise following the law (ie, no one is chopping off any limbs), then I'm all for it. What I'm not "all for" is giving legal authority to these courts. They should not in any way be compulsory. If you are a young Somali male and someone steals your boombox, you ought to be able to take the thief to Scotland Yard. If you are a young Somali woman and you are found guilty of dressing inappopriately and you don't want to accept the recommended punishment of the court, you should have every right to tell the court to go to hell.

Again, there will be exceptions to this. But there is nothing illegal about what they are doing, and I don't see any reason for this to be a concern so long as no legal authority is granted to the courts.

The church or the state?

2008-01-11T13:33:00.000-06:00

I have a question for those of you that are religious (I am specifically thinking of those of you that are Christian, but any of the major world religions will do). It's kind of a "would-you-rather" question. Would you rather be married by your church without a marriage license from the state, or would you rather have a marriage license from the state without being married by the church?

Would you be "less married" in the eyes of God if you didn't have a license? Is it the legal contract that binds you together or God?

Obviously, there are lots of legal issues that would result from being married without a license. You couldn't claim your spouse as a dependant (or be claimed by your spouse, whatever the case may be). You probably couldn't get your spouse health insurance through your employer. But all that aside, which do you value more? The church's approval of your marriage, or the United States government's approval of your marriage?

Here's another question that might shed a little light on your perspective. This question is really for those that believe that sex before marriage is a sin. Let's say the church you attend is not licensed by the state to perform marriages. I happen to have a good friend that was involved in a home-church with no "recognized" clergy, so this isn't so far-fetched. Now, let's say you decide to be married by the leader of your home-church first, then a week later you plan to have a legal ceremony by a judge. Would you consider it a sin to consumate your marriage vows before you were legally married? Would you maybe feel just a little bit bad about it? What if you did things the other way around? Would you think it was a sin to consumate your marriage before you were married by your church?

I'm not trying to get at any kind of "right" answer. This question probably has more to do with whether you think like a Libertarian than whether you are a good Christian. However, I would venture to say that American Christians give too much honor and respect to the government, and not enough honor and respect to the church. Paul admonished 1st century Christians for taking eachother to court instead of settling matters before church elders. How many people would go to their church to settle a business dispute? If both people were members of the same church, why wouldn't they?

Heart, Mind, & Strength

2007-12-28T13:05:00.001-06:00

"What good does it do to speak learnedly about the Trinity if, lacking humility, you displease the Trinity? Indeed it is not learning that makes a man holy and just, but a virtuous life makes him pleasing to God. I would rather feel contrition than know how to define it. For what would it profit us to know the whole Bible by heart and the principles of all the philosophers if we live without grace and the love of God? Vanity of vanities and all is vanity, except to love God and serve Him alone." - Thomas A Kempis, The Imitation of Christ

In the summer of 2003 I got a tattoo. The tattoo is of a triangle interwoven through a cross (reminiscent of the emblem of the Christian Reformed Church). At the point at the top of the triangle is the word "dianoia", which is Greek for mind. At the point at the lower right is "kardia" (heart), and at the point in the lower left is "ischus" (strength). At the center of the cross is "psuche" (soul). The reference, of course, is Mark 12:30 - "And you shall Love the Lord your God with all your heart with all you soul with all your mind and with all your strength".

The significance for me at the time was that I had come to the realization that I must submit my whole life over to Christ. I must worship Christ with my studies, my emotions, and my body. Not only should I work towards making Chrsit the Lord of my mind, my heart, and my body, but I should also make every effort to have more to offer him by expanding my mind through studies, by opening up my heart emotionally, and by keeping my body healthy. The idea surfaced in my mind while I was reading Plato's Republic. It seemed to me that many of Plato's ideas concerning justice corresponded exactly with this verse. Furthermore, it seemed that God himself modeled this through the Trinity. God the Father is represented by the mind, it is His Will that is done on Heaven and on Earth. The Spirit is the heart, the will of the Father, the force that continues to drive us and inspire us towards obedience. The Son is strength, the Word become flesh, the example of perfect action and perfect holiness.

These past few months I've been thinking more about this and have come to another sort of realization. The Christian life is largely comprised of three things: right understanding, right attitude, and right action. As a Calvinist, I was raised heavily under the influence of right understanding. As is the case with most Protestants, we tend to get caught up in the idea that our salvation hinges on our ability to properly understand how it is we are saved. If we somehow miss a critical piece of doctrine, we are condemned to hell. However, James tells us that even the demons have a proper understanding of who God is, what is critical is their ATTITUDE toward him - they shudder. Having a right understanding is meaningless unless it produces a proper attitude and righteous actions.

While I believe that a right understanding will often lead to a right attitude, and a right attitude will often lead to right action, I have to remember that my understanding is limitted, and that ultimately God has called me to love Him and serve Him, not to understand Him. So, I always try to temper my theological studies with the following two questions: "How does this affect my attitude toward God?" and "What does this knowledge provoke me to DO?" The purpose of these two questions is to make sure that my imperfect understanding does not influence my attitude or my actions more than God's scriptural commands for my life.

Sharia Law

2007-12-27T09:31:00.000-06:00

Sorry about the belated follow-up, but the holidays were busy and it takes a while to formulate coherent thoughts. Here's a brief review, Muslims in the Netherlands are asking for Sharia Law to be implemented. I don't fully understand what is being requested of the Dutch government, so I'm not going to comment on specifics. Additionally, there are probably many different factions asking for many different things. So, if I were to respond to some specific group, there would be another group trying to implement something totally different. So, to make this easy, I'm going to make a laundry list of different iterations, and comment on them. You can call them strawmen if you wish, but I like to think they are pretty reasonable strawmen.

Here goes:

1) A Muslim Community, say a group of mosques, could set up a kind of court to determine right doctrine and to administer church discipline. Christian churches already do this within their own denominations. The reason this is acceptable to me is probably the same reason it is not an acceptable compromise to some Muslims in the Netherlands: you can opt out. If you don't accept your denominations doctrine or discipline, you can usually find another denomination that will. The only reason one would accept the discipline of the court would be to stay in good standing with your religious community. This is an appropriate way to govern one's own community within a democratic society.

2) A Sharia Court could be given the legal authority to determine what is and is not "Muslim". I would compare this to trademark laws. If your mosque claims to be Muslim, but the Sharia Court has pronounced your doctrine to be blasphemous, the court could file suit against the mosque for trademark infringement. This would be religious oppression, albeit somewhat minor. It suppresses free speech in that those that believe they have right doctrine would not be able to express those beliefs without fear of being sued.

3) A Sharia Court could be given sole authority to license Muslim Mosques and to enforce it's rulings. This would be comparable to the state church in China. If you wish to worship openly, you must submit to the Sharia Court. If you don't, you risk imprisonment. This is obviously religious oppression. Liberal Muslims that hold beliefs contrary to the state's Sharia Court would be forced to practice their religion underground for fear of being imprisoned.

4) A Sharia Court could be given legal authority over all Muslims. This would be SOMEWHAT comparable to the Native American tribal system within the US. They are given some autonomy to govern themselves, but they are only allowed to govern their borders (like a township), not their people group. The major problem with giving any non-governmental agency authority over a people group is that someone needs to decide who is "in" and who is "out". If the Sharia Court is allowed to determine who is Muslim, then they could declare that everyone is a Muslim and therefore subject to the Sharia Court. Would a Muslim convert to Christianity still be considered Muslim? Sharia Law demands that the convert be punished (unto death, no less), so that person would fall under the Sharia Court's authority by their own definitions. If the Dutch Government decided who was Muslim then the Dutch Government would be complicit in religious persecution. A Christian, Jewish, or Hindi woman would be free to dress as she pleases, but a Muslim woman could be imprisoned because she wasn't fully covered. What if that Muslim woman did not believe that the hijab was still a moral imperative in today's society? Should she be subject to a Sharia Court that does not hold her same values simply because they both happen to call themselves Muslim? This kind of situation is totally incompatible with a fully democratic society as it applies rights differently based on race and religion.

5) Sharia Law could be codified into Dutch Law and apply to everyone, Muslim or not. I would hope that the religious oppression present under this situation would be obvious to even the most casual observer. Any Muslims that convert to Christianity would fear the death penalty. All citizens would be forced to submit to Muslim traditions. At this point, the democracy present in the Netherlands would no longer be a democracy. It could only be even remotely considered a democracy if the demographics of the Netherlands were such that the majority of the citizenry desired Sharia Law. It could not import Sharia Law in it's entirety, however, and still be considered a free democracy. I would compare it to the antebellum South. It was a free democracy for white property-owning men, but not for racial minorities and women.

Let me wrap this up. Ultimately, establishing a Sharia Court in the Netherlands is going to hurt the rights of Muslims more than any other people group. Non-traditional Muslims will be persecuted long before non-Muslims will be. While it could be considered democratic for the Hague to codify certain Muslim values by defining indecent exposure according to Muslim standards or prohibiting the sale of alcohol, it would be could not be considered a free and democratic society if Sharia Law were codified in it's entirety because Sharia Law grants rights based on religous affiliation. So, in case anyone missed the point: imposing Sharia Law is not about allowing Muslims to live as they please, it is about allowing a minority of Muslims to impose their will on other Muslims and ultimately on the majority, Muslim or not. Personally, I think our inability to see this relates somewhat to our tendency to group people together. Westerners do not see the distinctions between different Muslim groups. We lump them all together. Since one minority group happens to be very vocal about their desire to impose Sharia Law, we assume that must be what they all want and completely fail to stand up for the rights of liberal Muslims that desire to worship freely.

This Is Not Tolerance

2007-12-12T11:46:00.000-06:00

http://www.clickondetroit.com/news/14831144/detail.html

According to neighbors, a 57-year-old Muslim man in Detroit strangled his daughter to death while his family looked on because she refused to wear a Hijab (Muslim head scarf). Personally, I think this man, if guilty of the crime he is alleged to have committed, should be convicted of Murder 1 and put in jail for the rest of his life without the possibility of parole. Additionally, I think any adult members of his family that were present at the time of her death should be arrested for conspiracy to commit murder, and should receive similar sentences.

Now, I think there's a very important lesson in this about Sharia Law, and the desire to implement Sharia Law in Western Societies. When Muslims living in Western nations around the world ask to be allowed to govern themselves by Sharia Law, they are not asking the world to allow them to live as they please, they are asking to be allowed to enforce their religious laws on those that do not desire to follow them.

To my knowledge, this is still an issue in the Netherlands. some Muslims there would like to be able to set up their own Sharia Courts and govern "themselves" under Sharia Law. This has been framed, as I said earlier, as a desire to live as they please. The reality is they can already live as they please, what they want is the authority to force others to live as the Sharia Courts see fit.

Let me draw a comparison with the Catholic Church. The Catholic Church has a lot of rules that are obviously not a part of U.S. Law. For instance, if a Catholic man commits adultery, the Catholic Church would not be pleased, and might attempt to institute some kind of church discipline. Since the U.S. government does not recognize the Catholic Church as a legal authority, the adulterer would be under no legal compulsion to accept the Churches discipline. If the adulterer accepts the Churches discipline, he does so under his own volition. Ultimately, the ONLY punishment the Catholic Church has the authority to implement is excommunication. Now, since most Catholics want to stay a part of the church, they may be willing to accept some punishment in order to avoid being kicked out, but this is not compulsory, they can always choose to accept excommunication. The same applies to every non-governmental institution. If you attend a University, and you are caught cheating on a test, you may pleed with the administration to allow you to make some kind of restitution, so long as they don't kick you out. Ultimately, that is the only punishment they have the legal authority to implement: they can expel you. That's it. Your willingness to stay in the University is the only reason you might accept some other punishment.

Muslims already have this authority. If a Muslim woman refuses to wear a Hijab, a mosque can punish her IF she is willing to accept the punishment, or the mosque can kick her out. If a Muslim man drinks alcohol, the mosque can punish him IF he is willing to accept the punishment, or the mosque can kick him out.

To avoid the risk of making this post entirely too long... I am going to post the rest of my thoughts tomorrow.

Don't be dumb! (Traffic Accidents)

2007-09-21T14:29:00.000-05:00

This is the first of a series of perhaps 100's of blog posts and maybe even books with the title, "Don't be dumb!" A hat tip goes to Rando, because this was his life motto for a while, and I totally stole it from him. The first installment of "Don't be dumb!" involves traffic accidents.

If you ever have the misfortune of being in a traffic accident, it is your responsibility to move your vehicle so that it does not block the flow of traffic IF it is possible to do so. Somewhere along the line a myth has been perpetruated that you are supposed to stop your vehicle wherever you are and leave it there until the police arrive, supposedly so that they can see how the accident occurred. DON'T BE DUMB! Why on earth would any village, city, county, or state police force want you to block traffic?! Get out of the way! Besides the obvious aggravation that miles of backed up traffic causes, you are putting yourself and others at risk by leaving your vehicle in the middle of traffic.

As follows is Illinois State law:

(a) The driver of any vehicle involved in a motor vehicle
accident resulting only in damage to a vehicle which is driven
or attended by any person shall immediately stop such vehicle
at the scene of such motor vehicle accident or as close thereto
as possible, but shall forthwith return to and in every event
shall remain at the scene of such motor vehicle accident until
the requirements of Section 11-403 have been fulfilled. Every
such stop shall be made without obstructing traffic more than
is necessary. If a damaged vehicle is obstructing traffic
lanes, the driver of the vehicle must make every reasonable
effort to move the vehicle or have it moved so as not to block
the traffic lanes.

Overcrowded schools - more answers to life's problems

2007-09-05T16:30:00.000-05:00

Clarity Remix:

The Chicago Public School system is terribly overcrowded, and the Archdiocese of Chicago is closing parochial schools because of low enrollment and increased operating costs. If the root cause of these school closures is the inability of parents to pay for tuition, then the answer is obvious: the City of Chicago should offer vouchers to parents that wish to enroll their child in a parochial school (or any other private school for that matter).

Here are some quick facts to put this into a proper perspective:

The CPS budget is about $4.6 Billion, and there are about 431,000 students enrolled (I'm getting theses figures from all over the internet, so I might be mistaken somewhere along the line), that comes out to about $10,672 per student. Tuition for a parochial school runs somewhere in the ballpark of $3,400. Let's totally circumvent the whole debate about whether public schools or private schools are "better", and assume that that they are at least equal.

Here are some more fun facts for you:
This means that approximately 161,419 Chicago students are attending overcrowded schools (37% of the total student body)! The Chicago Public Schools have already spent over $2.4 billion for school construction and repairs, but despite these record accomplishments, overcrowding remains a problem at both the high school and elementary school levels.

Most of the schools charted in the prior link are somewhere between 120% - 150% overcrowded, so let's assume that of the 161,000 overcrowded students in CPS, all of those schools are at 150% capacity. Essentially, that means that CPS needs to find room for about 54,000 students. That means that CPS has spent about $44,444 per overcrowded student that needs to be placed into a new school. Holy cats! That's compared to $3,400 per student if they had given them all vouchers, or $183,600,000. Granted, the Chicago Archdiocese is not really in a position to accept that many students all at once, but there's also no reason for me to believe that they couldn't expand their capacity over time all-the-while keeping their tuition relatively constant. Additionally, it wouldn't necessarily require a full tuition voucher. Some parents might take their kids out of CPS if they were given a $500 voucher, some might leave for $1,000, you get the idea.

So, the first piece of information to store in your memory bank is that if Chicago had cut 54,000 kids a check to go to a private school, they could have saved themselves $2.2B. The second piece of information that you might want to store in your memory bank is the new budget per student: $11,714.59. Wait a minute... is that right? There were 431,000 students before, and now there are 54,000 less, so that makes 377,000. The City had a budget of $4.6B, they gave out $183.6M in vouchers, so their new budget is $4,416.4M. $4,416.4M divided by 377,000 students is $11,714.59. So, yes, the vouchers would be depleting the total CPS budget, but they would be taking more students out of CPS than they would money. That means that CPS would have MORE money per student after the vouchers were given out.

The real question is, why haven't we already done this? Well, there's an underlying assumption in all this that isn't very pretty. Lay-offs. If a school is 150% overcrowded, and they send a significant proportion of their students to parochial schools to get an education, the school is going to be left with a much smaller student body, a smaller budget, and a whole bunch of extra teachers and administrators that aren't really needed? In fact, the only way this works is if CPS right-sizes by laying off the extra teachers and administrators they don't need anymore. This isn't really a problem for the teaching population because, guess what, now that there are an extra 54,000 students going to private schools, there are 100's of job openings in the private sector at sectarian and non-sectarian schools. If you're good at what you do, you shouldn't have a problem getting a job at any one of these fine establishments. Really the only loser is the Teacher's Union, because these teachers will have non-union jobs.

How can such a program be administrated? Great question. Start by figuring out how many students CPS can reasonably handle. Take the number of students CPS has, subtract what they can handle, this is how many vouchers you give out. Who gets a voucher? There are three criteria: 1) they have to be enrolled in CPS, 2) they have to have a letter of acceptance from an acredited private school, 3) they can make up whatever other criterium they want at this point. If Chicago wanted to give vouchers to the poor kids, the dumb kids, the smart kids, the rich kids, the bad kids, the good kids... it doesn't really matter, as long as they reduce the overcrowding. The reality is that there are probably more overcrowded students than there are open slots in the private sector, which means that there is potential for more private schools to be built. So much the better, because if the private sector is building schools, then the state doesn't have to, and the private sector tends to build most everything faster and cheaper than the state does.

Last comment: how do you measure success? Simple: test scores and college entrances across the Chicago student population. So often we get bogged down in which schools are "better": public or private. The only thing that matters is how the student population as a whole is performing. If mixing public and private education results in higher test scores, higher graduation rates, and more college acceptance letters, then the program should be considered successful, regardless of where those students are coming from.

Twisted Worldviews

2007-08-16T12:14:00.000-05:00

Without getting overtly political, I wanted to point out an oddly twisted worldview that seems to me to be prevalent amongst "environmental extremist". I would even say that the definition of an environmental extremist is one who holds this particular view of the world.

Essentially, environmental extremists value all non-human life more than human life. I would contend that many of these extremists would say that they prefer the "natural order of things" to the industrialization of modern society. I don't believe that this is the case. I will give them the benefit of the doubt and admit that they have convinced themselves that they believe this, but ultimately it's not possible for them to believe this.

I'm thinking in particular of two quotes I have heard. The first was from a professor's lecture in which he stated that he looked forward to the time when some super-bacteria (read plague) would wipe out a significant portion of the human race so that the earth could return to the natural state. Another was from an attorney that lamented that DDT had nearly wiped out Malaria in Guyana because it had led to a reduced infant mortality rate which is now contributing to earth's over-population problems. This same attorney also made some inane comment about the morality of killing mosquitoes.

My contention with this worldview is that it is totally self-destructive for no apparent reason. I can understand concern over the environment because we depend on it, but that is really only a thoughtful concern over ourselves. But valuing the environment over human life is not only self-destructive and irrational, it's UNNATURAL.

The natural world is governed by one law: the strong survive. All of the natural world, in fact, the natural universe, is one massive competitive struggle. We all understand this notion when it comes to carnivores: the lion lives because the antelope dies. But consider the tree in the rain forest. That tree is engaged in a fierce competition, arguably more fierce than the lion and the wildebeest. Every hour of every day that tree is competing with all of the other plants around it for sunlight and water. It's branches reach higher to soak up more sun, and it's roots plunge deeper and spread broader to soak up more water. How many thousands, no millions, of trees sprouted at it's feet, only to be strangled, starved, and suffocated? How many of those saplings were seeds from the very tree that strangled them?

The natural order of things demand that we compete ruthlessly without conscience. Man is the only beast which is able to totally dominate all of nature, and yet chooses not to. It is not the natural order of things that environmental extremists desire, it is the absence of man. It is another instance of man rejecting his role as an image-bearer. It is a form of self-hatred that springs from the fall.

I value human life more than any other form. Because human life depends on the environment we must care for it. It is important that caring for the environment for it's own sake be relegated to a secondary priority.

If I valued human life the same as any other form. Then I would find no reason to care for the environment. Our success or failure makes no difference. If we drain the earth of all it's resources, and force ourselves into extinction, what difference does that make? There will be other animals to take our place. The earth with keep spinning. For what reason should I care for my young over any other animals young? If I care no more for humans than mosquitoes, then why should I care whether we use DDT or not? If humans die, so be it. If mosquitoes die, so be it. One of us has to die.

It is only when I value human life LESS than all other animal life that I come to the inane conclusion that we must stop using DDT lest we kill too many mosquitoes. It is only when I value trees more than people that I would consider it a blessing if mankind was wiped out by a plague.

I suppose that all of this is simply to say that environmental extremism is not only totally immoral, it's not only totally irrational, it is also totally unnatural.

I wish I had skills

2007-07-20T12:43:00.000-05:00

This is an example of a wonderfully written blog post. It features the beauty of Jesus' Kingdom breaking into this world through mission work, the real horror of Islamic terror, a brief line regarding the coming clash of China vs. Jihadists, and a shot at Western elites. Superlative.

Purdue's computer simulation of the 9/11 attack

2007-06-27T19:58:00.000-05:00

It's amazing science.

Another veto

2007-06-21T12:39:00.000-05:00

President Bush has promised to veto another bill that, according to the press, would "allow federal funds to be spent on embryonic stem cell research". An important point in this debate is the fact that private organizations and state governments are free to spend as much as they like on embryonic stem cell research. Another important point about this debate is how it is framed. By and large, the debate assumes that federal funding is the default, and that Bush is banning federal funding. While this is true, it is equally true that federal funds come from taxation, and taxes are compulsory. So, it would be equally true to say that proponents of federal funding of embryonic stem cell research are in favor of threatening U.S. citizens with fines and imprisonment if they refuse to donate money to such research, even though the benefits of stem cell research have not been proven and many Americans find the research methods to be unethical. Currently, financial support for embryonic stem cell research is voluntary. It operates under the governance of freedom and the free market: altruists can donate as much money as they want in order to potentially find cures for various diseases, and capitalists can invest as much as they want in order to make profits on the sale of any potential cures.

Honestly, this logic can be applied to pretty much any government program. Any time the government spends money, it does so through compulsory taxes that are enforced by threat of further fines and/or imprisonment. And every dollar the government spends should have to pass through a series of questions: Is it necessary? Is it ethical? Is it effective? Is it right and proper that the government should levy taxes through compulsion, rather than allow free people to spend their money voluntarily? This is not to say that the government should not do anything, but rather that the government (and the people) do not hold government spending to a high enough standard. This is why we need more pork butchers in Congress, because our government needs to set higher standards for the money it spends.

Blair on the media

2007-06-15T11:14:00.000-05:00

Blair recently "blasted" the media in a speech he gave on public life. The best quote from the speech:

"The audience needs to be arrested, held and their emotions engaged. Something that is interesting is less powerful than something that makes you angry or shocked. The consequences of this are acute. First, scandal or controversy beats ordinary reporting hands down.
News is rarely news unless it generates heat as much as or more than light."

The last sentence with the light metaphore is perfect. Great reporting doesn't need to editorialize or speculate, the facts will more often than not speak for themselves, and the public will respond appropriately.

Would you vote for a Mormon?

2007-06-07T09:13:00.000-05:00

I'll give you two sentences that sum up what I want to say about voting for a Mormon. A person's religious beliefs are important in so far as they affect that persons political ideology, and I will vote for the person that has a political ideology that most closely resembles my own, regardless of where that political ideology came from. When a Christian requires that the President of the United States also be a Christian, that implies to me that they are putting their faith in the United States Government to be the Bride of Christ, instead of the rightful Bride: the Church.

I do not think that voters should submit Presidential hopefuls to religious tests, but I do believe that a persons religious beliefs can affect their political ideology, and it is appropriate to test a candidate to see how their orthodoxy affects their politics. Just because someone is a Christian does not mean that their political ideology will match your own, and just because someone is not a Christian does not mean that their political ideology will not match your own. If Fred Phelps, a Calvinist (as am I), ran for President I would say that his religious beliefs are incompatible with the values of the American people and those beliefs disqualify him from serving as an elected official. Personally, I don't think he's fit to be a crossing guard, let alone an elected official. The point is that even though Fred Phelps and I agree on some of the tenets of Calvinism, our agreement on some matters of theology are totally inconsequential when it comes to the Presidency. Pretty much the whole fleet of Democratic contenders are ostensibly Christians, but they are all shaky on abortion (if not staunch supporters). Mitt Romney is a Mormon, and we disagree completely on a wide variety of theological matters, but none of those theological differences have anything to do with how Mitt would govern as President.

Second point, the United States government is not the Kingdom of God. The government has a role in our society, as does the church. I think that many Christians have become frustrated with the church because they feel it is either not powerful enough to turn the world into the Kingdom of God (you can read that "make the world a better place") or it is not working fast enough, or hard enough. The temptation is to turn to the state to do what the church can't or won't do. It is a shortcut, and often times I think it is an inappropriate shortcut. I think that this is the same mistake that the Jewish people made when they expected the Messiah to be a political and not a religious leader. So, as a Christian, I will vote for anyone that I think will give the church the necessary elbow room to do what it is called to do. If a Christian were running for office, and I felt that they planned to usurp the role of the church and give it to the state, then I would oppose that candidate. I believe that the state is called by God to fulfill a certain calling, but I do not think it is necessary for the President to be a Christian to govern in a way that fulfills that calling.

Homosexuals in the military

2007-06-04T10:31:00.000-05:00

Recently, Wolf Blitzer brought up the issue of Homosexuals in the military during the Democratic Presidential Debate. I have a couple thoughts on what I deem to be a common-sense compromise. Right now there are two major camps on the issue: 1) If a member of the military is found to be homosexual, they should be discharged, and 2) Homosexuals should be protected from being dismissed or discharged based on their sexual preference. I think there is a third option that resides somewhere in between.

First off, I'm not real keen on forcing politically correct attitudes on anybody. If someone is racist, they own a local general store, and they don't want to hire ethnic minorities, then I really don't see why the government has the authority to say, "You have to hire minorities." I think that the government, however, should run under different rules. I don't think it would be appropriate for a government employee to refuse employment to someone based on race.

Secondly, while I think that race is inconsequential when it comes to employment, I think that sex and gender CAN be consequential. We live in a society that separates the two sexes. Men and women, boys and girls, are separated to some degree in every realm of our society. I think that this is appropriate. I think it's appropriate that we use separate restrooms, I think it's appropriate that there are Boy Scout Troops and Girl Scout Troops, I think it's appropriate that men foster male friendships, and women foster female friendships. This is the reality in which we live, and I don't believe it needs to be changed.

Third, homosexuality confuses the gender distinctions. As many of you know, there is a difference between sex and gender. Sex refers to anatomy, and gender refers to the values and behaviors that are associated with the sexes. For instance, some clothing is considered male, and some clothing is considered female. Clothing is a part of our gender identities and has nothing to do with sex, per se. Sexual attraction is a HUGE part of gender identity as well, and that gender identity is simple: men are attracted to women, and women are attracted to men. That is why I say that the issues surrounding homosexuality are gender issues. It's not an issue of what group a person is affiliated with like race or religion.

There are many occasions where separating the sexes is appropriate, and I believe that at those occasions it is also appropriate to separate along gender lines as well. Two examples, it's not appropriate to separate an office into "male" and "female", so there are no issues incorporating homosexuals into a normal secular workplace. A locker room however, is a place where the sexes are separated, and here we will find society baulk at the idea of homosexual men showering with heterosexual men. This scenario doesn't conform along gender lines, so accommodations need to be made. The normal accommodations are a) homosexuals don't announce that they are homosexuals, b) individual showers are installed, or c) when the individual is known to be a homosexual they may be given time to shower privately (think of a football team where everyone in the locker room knows every other person). Regardless of whether accommodations were successful or not, it is understood that the division of the sexes did not successfully divide the genders as well, and that accommodations were necessary.

When it comes to the military, I think that it is appropriate for there to be some occasions where division between the sexes and genders is necessary (barracks and showers, for instance). Can this separation be acheived and homosexuals also be accommodated? I think so, but I don't think that we can legislate it. There are places in the armed forces where the sexes are not separated, there is no reason for homosexuals to be excluded from those arenas. In situations where the sexes are separated, I think it should be at the discretion of the commanding officer whether accommodations can be successfully implemented. I don't think that a person should be discharged from the armed services because of sexual preference, but I think it's appropriate that a CO be able to assess whether a homosexual can be assimilated into a unit, and if they can not, that CO should have the authority to reassign that individual. I don't think that homosexuality should mean automatic reassignment or dismissal, but I also don't think that a CO should have to wait until there is a documented problem for him or her to make appropriate reassignments. Combat units, especially, depend on group cohesion, and a singular gender identity is a critical part of that group cohesion. If a CO deemed that group cohesion was being threatened by an individual member of the team, they should have the right to reassign that person, regardless of what the reason is, even if that reason is regarding an individuals sexual preference.

Stay in the Shadows

2007-05-24T11:30:00.000-05:00

What's wrong with leaving illegal aliens in the shadows? I'm not a hater. I don't want every illegal alien to be deported. I agree with those that say that many of them are hard-working, family-oriented people. Good for them. You want to work here? Good on you.

America is facing the symptoms of a serious problem: Central and South America sucks. How can I phrase it nicely? Yeah, there are some good things about the rest of the Americas, but since the first Spanish and Portuguese settlers stepped foot on American soil there has been exploitation. They were then, and they continue to be, racist states with wealthy aristocrats that exploit a vast underclass of people to harvest from the land every available resource. First it was gold, now it's oil, lumber, coffee, illicit drugs, and other produce. The wealth is distributed the same way it always has been: Europeans have it all, native mixes have next to nothing, and the natives have absolutely nothing. It sucks, but it is NOT the fault of the United States that Latin America can't stop exploiting its lower class.

The SYMPTOM of that disease is the "immigration debate" in America. All of the downtrodden from around the world (primarily Latin America) are coming to the U.S. so they can be less downtrodden. I feel for them, but that's not a solution to the border problem. Turning North America into South America is just going to make it worse. I have a heart for these people, but I have a brain, too. Making it worse for us does not make it better for them. Bankrupting our economy doesn't solve any of our problems.

What can America do? America can enforce it's laws. Period. Close down the border, and prosecute employers that hire illegal aliens. Some say, "You can't deport 12 million people!" Fine, don't deport anybody. Well, you can definitely deport the pimps in Minneapolis that were running a prostitution ring there. If their home country won't take them, deport them to the middle of the Pacific Ocean in a rubber raft with no paddles. Deport them to Siberia and pay the Russians to show them a little Russian hospitality. I don't really care where they are, as long as they aren't in American society. Other than the drug-runners, pimps, and slave-traders, leave everyone else in the shadows. They came here to work in the shadows, let them work in the shadows. Hopefully their kids will get a better education than they had and get themselves out of the shadows, but I see no reason to legitimize or deport their parents. They came here because they are starving in Mexico and living in houses made of pallets and tin cans. Their living standard is already 1,000 times better than it was in Mexico. Why must we now bankrupt our government paying for medical attention and social security? They weren't going to get it in Mexico, why should they get it here?

Why do we only care about the poor and down-trodden that snuck into the U.S. What about the poor that are still in Mexico, should we pay for their medical needs? What about South Africa, should we pay for their retirement? What about the poor of India, should we pay for their children to go to school? It would be nice if we could, but it's not possible. We do what we can, and I encourage you to dig out of your own pocket to help people, but there is no reason to make our government financially obliged to pay for 12 million people to get services they didn't pay for that they never would have gotten had they not broken our laws to get here.

Hot Hip Hop by Christian Artists

2007-05-22T16:06:00.000-05:00

When I begin to feel alone among an idolatrous throng (I just read D.A. Carson call it the Elijah syndrome), God frequently reminds me of His remnant through hip hop. These dudes are raw with their crunk-styled, trunk-rattling tracks:

Lecrae

Lecrae is part of the 116 Clique. Peep them dominate:

Flame is a dude who could definitely be on the radio if He didn't love Jesus. You can hear three songs from his new album, Our World Fallen, here.

Bingo

2007-05-18T14:28:00.000-05:00

"We need respect for the law in this age more than we need workers. We need secure borders more than cheaper products."
--John Mark Reynolds, Professor of Philosophy at Biola University

Christians with big hearts and small brains tend to join the typical leftists that support illegal immigration. It's pretty simple:

1) An open border is a security risk.

2) Flooding the market with unskilled laborers will drive down the quality of life for the unskilled laborers we already have, i.e. the blue collar, non-college crowd. Blacks lose mightily when illegal immigration is allowed.

This goes out to the_dude

2007-04-30T18:04:00.000-05:00

It's tragic that they pulled that Maury clip. Be consoled by this:

I blame Don Imus

2007-04-17T19:11:00.000-05:00

Religion 2.0

2007-04-04T01:30:00.000-05:00

How fun it is to worship
at the Church of Wholly Me!
Services are everyday
and, of course, admission's free!

I know what you're thinking
I used to think the same-
"All those wars and death and strife
isn't religion mostly to blame?"

With the old ways, yes it's true.
On this point we both agree.
But with the New, Improved, and Better Faith
I can't help but think of only Me!

Oh, sure, I know it's tough
to meet new folks, exchange a pleasantry.
But conversation is so easy
If the subject's always Me!

Oh, and that's too bad, about your woes.
Cancer is such a nasty thing
to have taken your husband long ago
and I see you still wear his ring.

But while we're on the subject,
did you know that I was ill?
For a while I was quite a sight
but I recovered, according to My will!

Now, about our funds, just so you know,
our budget isn't what it used to be,
which I find difficult to understand
because I always tithe to Me!

Evangelism is so easy,
the Faith's growing at quite a pace.
I don't know why, but thankfully
all the world holds Me in the proper place!

The mall's a tabernacle
T.V. ads are sacrosanct
Best part is, for all this stuff
I know it's Me I have to thank!

But anyway, you should drop by
next time you have an evening free.
Our membership's through the roof these days
at the Church of Wholly Me!

The other side of 300

2007-03-28T15:07:00.000-05:00

The General detailed at length what he enjoyed about the film "300" in the previous post. So, I wanted to spit out one of the movie's failures and connect to a larger point.

One of my favorite writers today is Victor Davis Hanson. VDH gets tons of hits because I linked it in the HIFI sidebar. Hanson writes beautifully, and he defends Western Civilization from modern deconstruction with sharp insight.

Hanson wrote the introduction for a book on the making of this movie and also reviewed the film. It seems that he and Frank Miller are on the same page regarding history and man's quest for freedom.

They are both wrong. Despite what is suggested in the film and your average history book (or even books written by VDH, which are excellent), secularism does not lead to freedom. The concept of a secular reality began with Jewish monotheism, which stood in stark contrast to the animism of pagan religions. When secularism is divorced from its monotheistic mooring, Secularism becomes a tyranny of its own (see Stalin, Mao, and Pol-Pot).

In general, the contribution of ancient Greek city-states to the development of the West is way over-stated. The Greek and Roman cultures did not consider compassion to be a virtue. The truth is that Christianity is the basis for the correct understanding of freedom, which led to labor laws, civil rights, human rights, etc.

True freedom is found in the Bible. A slave of righteousness enjoys freedom in Christ.

If you hate freedom, you won't like 300

2007-03-12T18:39:00.001-05:00

I just recently watched Frank Miller's 300 and I feel it's my duty to share with you all how awesome this movie really is. For those of you that have been living in a cave on Mars for the last 3 months, "300" is a Warner Bros. movie based on Frank Miller's graphic novel "300", which is based on the history of the Battle of Thermopylae in which several thousand Greeks (most notably 300 Spartiate elites) held back Persian hordes numbering between several hundred thousand and millions. If you want to read the history, you can try the wikipedia link; read on for the movie review.

I have to start with the criticism. The movie was long on nudity, and long on horror movie special effects. The comic book was long on nudity as well; but I appreciate Frank Millers decision to portray the Spartans in the "heroic nude" that you might see in ancient art. It was an interesting and bold artistic direction. The horror movie special effects, however, were not in the comic book and were a bit ridiculous.

From the beginning, it is obvious that this movie is trying to convey just how bad-ass Leonidas and his Spartans were. The conclusion, "Mission accomplished". The battle starts out with the Spartans squaring off against 10's of thousands of Persians and they quickly get up close and personal and fight for every square inch. Then the Spartans start killing them. First they kill the first row of idiots, and they move forward a step. Then they kill the second row of idiots and they take another step forward. Then they start stacking up the bodies like lincoln logs. The one on combat is very well choreographed to the point where my fiance thought it was almost graceful. I think she used the qualifier "almost", simply because it's hard to call a bloodletting "graceful". I have no such hesitations: it was graceful. The killing style was almost meticulous in it's intricacies. If these Spartans are supposed the best of the best, trained since youth, they better have some kind of crazy-awesome techniques that no other armies or soldiers have, and those crazy-awesome spear skills and sword skills come through in 300.

The dialogue was inspiring. Truthfully, the movie was full of machismo and one-liners, but it worked exceptionally well. I'm pretty sure Gerard Butler could have yelled every single one of his lines in his Leonidas roar and I still wouldn't have thought he was over the top. It's an over the top story of over the top soldiers from an over the top culture in an over the top war, and the movie does them all justice.

The movie is based on history, and the history is pretty simple: 300 Spartan warriors kill 10's of thousand of Persians that are trying to raze their countryside, rape their women, and enslave their children. Do you expect this film to question whether there is honor or glory in the horrors of war? Do you expect this film to delve into the complex moral decisions that leaders in a time of war must make? Do you expect this film to question our assumptions about the innate moral superiority of the Greek cause? I hope not! Because this film does none of those things, and rightly so. We have this modern obcession with deconstructing and sanitizing history until we have utterly ridden it of any humanity whatsoever. This is Greek history and Greek sacrifice and it deserves to be told from the Greek perspective, regardless of whether it improperly dehumanizes the Perisan armies (which this movie most certainly does).

I also think that it is entirely appropriate that the movie be grossly exaggerated. When you are telling an epic story it is your obligation as a story-teller to project the sense of awe that was felt by those that were present. This kind of story-telling naturally conjures up supernatural images in the listeners mind that are beyond the reality. I think it's entirely appropriate for comic book writers and film directors to try to capture those inflated images on paper and on film. Watching 300 gave me this sense that I was 7 years old and I was listening to an old man tell the story. The images on the screen were exactly what my mind would have conjured up.

I want to draw out one more observation about story-telling and connect it to this film. Morality is conveyed far better through story than through instruction. If you want to start your children on the road to virtue, tell them great stories of great men and women performing great deeds of honor and justice and virtue. Once that foundation has been laid, you can expound on the intricacies of ethical systems. You need great stories that exemplify right behavior more than you need systematic theorums. 300 is one of those stories. It is also an antedote to the anti-heroes that are regularly churned out by the mainstream media. I don't need whiny second-guessing protagonists that struggle more with themselves than with the forces of evil around them. I want to see the model. I want to see the gold standard by which we should all be so courageous to live by. That's why I loved 300, and that's why I think you will too... unless you hate freedom.

Cro Cop

2007-03-01T19:49:00.000-06:00

Yes, I did work 60 hours last week, waking at 4:45 AM and getting home at 7 PM or later from Monday through Friday. Oh, and yeah, I'm on pace to do the same this week. I prayed to Jesus for a new job, and, man, did He deliver.

Working like a fiend has given me a new appreciation for mindless fun. Enjoy a clip of my guy, Mirko Flipovic, otherwise known as Mirko Cro Cop:

Why don't churches teach the doctrine of the Holy Spirit?

2007-02-12T14:05:00.000-06:00

One answer - Peeps are afraid to seek the Spirit because of idiots like this:

Big Ups: Joe Carter

Do you suspect...

2007-02-09T10:24:00.000-06:00

...that your pastor's sermons need a dash of Sermon Spice?

Adam J. likes that extra flavor kick from these Mac vs. PC takeoffs that feature Jesus vs. Santa. I found them to be a bit bland for my taste. I prefer a zestier Jesus, one with a winnowing fork in hand, perhaps.

I hate Macs

2007-02-07T07:52:00.000-06:00

says Charlie Brooker

Lady M

2007-01-30T18:12:00.000-06:00

I got laid off on Friday. Residential land development has slowed down. The Market has spoken, and she told me my labor is spent better elsewhere. I gotta love a girl who'll just tell you how it is.

Too bad for the Government employees I know. They'll never hear the truth from the Market. When she smiles at you, you know it's legit. It's not like that fake tight-lipped face the Government gives its people year after year. A public school teacher can walk across water and get the same love his lazy co-worker gets.

But the Market, she'll reward you. She is just, and when she frowns, at least you can be sure it's real. I hope I can please her in my next job.

Ode to a Homeless Black Man Riding a Black Bicycle While Wearing a Black Helmet With a Jack in the Box Clown Head on Top

2007-01-25T12:30:00.001-06:00

(by the_dude)

In a rush, you race, reckless
and sure
You do not have time for those who
meander or mingle
Speed!

Confidence you have.
Purpose is yours.
Vigor
Questions I have.
Why Jack in the Box?
Your destination?
Mystery

Ride on Black Knight!
Acquit yourself with honor and victory
shall be yours.
Who can stand for long against the clown?
Ciabatta sandwiches - for reals.

Hey! McCloud! Get offa my ewe!

2007-01-19T11:05:00.000-06:00

The subject is a Scottish joke. It goes something like, "What's the difference between the Rolling Stones and the Scottish? The Rolling Stones said, "Hey, you, get offa my cloud', and the Scottish say..." now you get it.

At any rate, I thought this article was interesting.

Couple quick comments:

I think the homosexual community is being very consistent in their support of the notion that sexual preference is an inseperable part of identity. It is not surprising that they would be so adamently opposed to any science that suggests otherwise. However, I think that this is an emotional and political reaction and not a rational, ethical, or scientific reaction. Gaining a better understanding of animal/human behavior is not unethical; neither is producing ways of changing animal/human behavior. What if the scientists were studying ways of making rams more passive so that they didn't fight? Would they have a right to be aggressive?

I think it would be very inconsistent of society at large to reject this science, considering there are many that abort unborn children because they aren't the desired sex. Compared to that, it seems pretty benign to take hormone supplements to encourage a desired sexual preference.

I thought it was a bit irresponsible of the author to include comparisons to Nazi eugenics experiments. These scientists are not conducting experiments on humans (number 1), they aren't conducting genetic experiments (number 2), and their purpose is not related to some felt moral calling to eradicate homosexuality (number 3).

Personally, I think this is pretty responsible science. This is a pretty straightforward study of animal behavior and it seems to be following the evidence as opposed to the political agenda of the day. Jonah Goldberg had a recent post that puts it pretty plainly: it's not the science that's moral or immoral, it's all about how we use it.

Thanks, Big Brother! You're the best!

2007-01-18T09:11:00.000-06:00

Can someone please explain to me how anyone in their right mind can read the first ammendment and decide that this is a good idea, and why would they want to bring it back?

I'm absolutely appalled by the number of people that actually support this legislation. It doesn't surprise me in the slightest that this was upheld in the courts over a case involving Christian broadcasting. Apparently, it's okay to talk about women's boobies all you want on the radio, but you can't call someone a communist unless you have the commie on your show to rebutt your assertion that he or she is in fact a communist. This is a terrible bill and it is just begging to be abused.

What I really find disconcerting is how quickly people adopt and adapt to government intrusion. It becomes so "normal" so fast, and any notion that we should change things back to the way they were are hysterical and radical. Another great example is the separation of church and political speach. If you are a pastor, you can't talk about politics from the pulpit. Well, you can, but then your status as a "church" changes to "political organization" and the government taxes the collection plate. What amazes me is how few Christians find this intrusion upsetting and are more likely to criticize the pastor than the government. [Personally, I think the solution here is a restructuring of our tax system, but that's another post entirely]. For those of you that think the church should not get involved in politics, I have a few questions: Why was John the Baptist beheaded? Who was Jesus calling a "fox" in Luke 13:32? Who did Elijah run from and why? Is Jesus' parable about a king going to war in Luke 14 a wholly fictional story, or does it refer to historical events?

You can catologue this as reason# 129 why we need more conservative judges on the benches.

Best Sunday Ever

2007-01-15T08:12:00.000-06:00

Rex Grossman shuts up critics. Lance Briggs adds 0's to his future contract. The Chicago Bears win.

Jack's back in Season 6 of 24. The opening storyline pits an islamophobic, unconstitutional, aggressive policy against terrorism versus a nice, "civil rights"-infused, feminist pipe dream policy. Needless to say, I'm pulling for the islamophobes.

Coming from where I'm from

2007-01-11T23:29:00.000-06:00

An excerpt from my seminary application essay:

"One day's events that captured my life in high school was [the Friday] I received my score on the ACT. I cut class that day [after drinking late into the previous night], but after school I went to pick up my [Caprice] from the [high school] parking lot. I ran into a teacher who told me to inquire at the office about my ACT results. I learned that I scored a 34 out of 36, bettering 99% of my peers across the nation. As I was gloating, the dean saw me, realized that he hadn't seen me during class time, and suspended me. I learned of my greatest academic achievement and earned my severest school punishment in the span of minutes."

Grace kept me from total self-destruction.

You might not be able to handle this essay

2007-01-02T17:45:00.000-06:00

It is unconventional and crass. As David Brent would say, "Perfick."

That is, perfect to mull over, because it is not perfect in that someone spellchecked it carelessly.

Glossary for the essay:

"WIC" - Food Stamp Programme

"HNIC" - Head Nigga In Charge

Read here.

(Big Ups: Anthony Bradley)

The best columnist in a Chicago newspaper...

2006-12-26T12:22:00.000-06:00

...delivers again.

Wine not?

2006-12-18T22:44:00.000-06:00

Jack Bauer and the_dude

2006-12-14T12:26:00.000-06:00

the_dude will be returning to Illinois on Friday. Jack Bauer returns to the United States in the upcoming season of "24". Let's compare and contrast. I'll begin:

1. Both heroes have suffered under Communist regimes, Jack in China, the_dude in San Francisco.

Christmas Trees

2006-12-11T13:43:00.000-06:00

What to do about Christmas trees?

The problem with lawsuits in America is that, for the defense, even when you win, you lose. The airport could have stood up for themselves and fought the rabbi in court to keep the Christmas trees, but this would have cost thousands of dollars in legal fees. The airport correctly diagnosed the situation before them: attempt to please all of the people all of the time, or please none of the people all the time. Since it has been rightly said that the former is impossible, the airport correctly chose the latter. The airport caved, as most private and public institutions do. The fear of lawsuits has totally changed our culture and continues to change our culture. Using fear to change a culture... what's that called?... I know there's a word for that... darn it, I just can't think of it right now.

Personally, I think that these matters should be settled at the grass roots, and judges should be delivering verdicts that support the freedom of the people to determine their own culture.

For example, should your local court house decorate it's foyer with a Christmas tree? The answer is simple: vote on it. You could vote on it directly by approving a decorating plan, or you could vote on it indirectly to approve a decorating committee. In this way every individual has equal access to the public process and equal influence on the result. If things don't go your way: so what? How is this different than any other matter that goes before a local government. Sometimes you don't get a stop sign where you want one. Sometimes the zoning revision doesn't go your way. That's the trouble with Democracy, not everything will go your way. I would like to take a moment to point out a critical difference between two camps in American culture: those that believe that equality means equal access, and the other that believes that equality means equal results.

This issue not complicated to me. If I visited Egypt, I would expect the architecture, the art, the decorations, and the celebrations to be in keeping with Islam. If I visited China I would expect these same things to be in keeping with Buddhism. When others come to America, they should expect to hear, "Merry Christmas," and see Christmas trees and nativity scenes. This is a part of our culture. The difference should be that these things should not be predetermined by law, as they are in many countries, but they should be chosen by the free people that live there.

I recognize that I am a bit of an idealogue, so I realize that this is the pot calling the kettle black, but ultimately we cannot make idelogically predetermined decisions that will apply to all people in all times and all places. Eventually, you have to say, "You know what, let's let the people decide." And this is one of those issues where I say, "You know what, rules and laws are not going to work here, we need to let the people figure it out for themselves." We need to act like adults and make our own decisions. Unfortunately, the more power we give to the government to make our decisions for us, the harder it will be to get the power back.

Proving vs. Proclaiming

2006-12-07T12:35:00.000-06:00

I can't prove Jesus rules the universe. But I will proclaim it with absolute certainty.

I was going to expound. But what's the point, when Joe Carter has done all the heavy-lifting?

Bottom line: Doubt is sin. Christians move away from sin towards certainty in Jesus.

Three views. Two destroy. One gives life.

2006-12-05T12:16:00.000-06:00

Aesop Rock in "Daylight" from the album "Labor Days":

"All I ever wanted was to pick apart the day, put the pieces back together my way"

Oneway in his notebook while struggling with doubt:

"Teeter-totter on the brink forever,
Never fall, but never settle,
Thorns adorned with vibrant petals,
I've been told there's nothing better,
But, really is there anything worse?
Than the nebulous expanse of freedom,
It's a curse."

muzeONE from Redeemed Thought in "The Anthem (Build Up)" from "TruthBeautyGoodness":

"Jesus, the Chief Cornerstone,
He re-rolled the stone,
So we could see home,
like when Stephen was stoned"

Doubt is so hot right now

2006-11-29T17:16:00.000-06:00

"the opposite of faith is not doubt, but certainty."

My friend and intellectual sparring partner, Pepperdeaf, wrote this in a comment. It is poetic and made me muse for a moment. This statement sums up much of the sentiment du jour going around Emergent and Mainline congregations. I myself find a wellspring of worship in certain mysteries we have in Jesus, such as how He chose the elect. But does enjoying mystery mean rejecting certainty?

Last weekend, I was studying a thrilling Book of the Bible, 2 Kings, and I came across this in chapter 7:

"Behold, if the LORD should make windows in heaven, could this thing be?"

Besides supplying an enchantingly vivid phrase to me, the context of this quotation reveals that God punishes those who doubt. I immediately recalled Zacharias, the father of John the Baptist, who was struck dumb for doubting.

Then there's this:

Now faith is the assurance of things hoped for, the conviction of things not seen. (Hebrews 11:1)

As a matter of fact, if you replace all the occurrences in the Bible of the word "faith" with the word "certainty", I find congruence. The word "doubt"? No way.

Finally, certainty, absolute truth, propositional truth, etc. cannot be avoided. Everyone believes in these things, and no one is outside of them. The next time someone says something like "The opposite of faith is certainty" to me, I will reply, "Are you certain?"

Hit up what Ariel found his theology professor posted regarding C.S. Lewis, doubt, Mark Driscoll, and felt-relevance, among other things. It's dope.

To: Anyone That Cares

2006-11-18T12:25:00.000-06:00

The little writing that I've been doing has been mostly on my essay that the application to seminary requires. Beyond that, I've been mixing it up on Westy's blog and ignoring HIFI. That will change.

What follows is my response to the quotation below.

"...church doctrine has been established by people who tend to be white, male, and rich"

Come on, now. The reality is that God blessed mankind through different cultures all along. The Asian and African continents were prominent for thousands of years, then came Europe, and also North America of late, historically speaking.

The "white, male, and rich" label is a sign of the times, a vacuous and misleading slur. Rich? Permit to point out the abounding irony here. Because of the Reformation, led by the white men Martin Luther and John Calvin, the skill of literacy was transformed from the aristocrat's luxury to every man's right. Why? So every family could study the Bible.

When Calvin studied Aquinas and Augustine, he didn't flagellate himself due to these authors' wealth. Why? Because for most of history, wealth and education were inextricably linked.

Fast forward to modernity, where we find out generation's ungrateful response. We find the Chairman echoing the current university logic, assailing the wealth of these scholars, the same men whose labor smashed the bond between wealth and education!

It is a fantastic spectacle: A young man today, enjoying the fruits of a society where literacy is normal, turns and lambasts theologians of days past, with the very criteria that THEY BROUGHT ABOUT.

What else to say? We bite the hand that feed us.

It's about gender

2006-11-07T13:02:00.000-06:00

I have heard the argument that homosexual marriage is not about civil rights because every person a straight man is legally allowed to marry a gay man could also marry. A strict interpretation of the law that does not take into account what people "want" to do would say that the law is applied equally. There is no person that a straight man could marry that a gay man could not marry. However, there is a disparity between who men can marry and who women can marry. There is no person that a man can marry that a woman could also marry and vice-a-versa. There is segragation here. Men and women are considered separate but equal under the law. They are not afforded the "same" rights, they are afforded "equal" rights.

This is in complete agreement with the traditional/conservative notion that men and women are equal although they are not the same. It is a more "liberal" idea to believe that the sexes are not only equal but the same. I say "liberal" because I don't think there is anything more liberal or free-thinking about the idea, but it is more in line with a particular set of beliefs that we have come to classify as "liberal".

In regards to the boy scouts, the military, and just about any other organization where homosexuals have been denied access, the problem is that homosexuals do not fit into the concept of gender. Sex is the physical parts that men and women have, gender is about the character, roles, and responsibilities of the two sexes. While homosexuals fit into the sexes, they don't fit into the genders. Since sexual preference is such a fundamental part of our concept of gender, it becomes almost impossible to divide homosexuals and straights by sex and by gender.

***edited 11/8/2006

Two quick examples:
If your local pool has a locker room with showers that don't have dividers, where should homosexual men shower? If with the men, won't this make the other men uncomfortable? If with the women, won't this certainly make the women uncomfortable? If it is okay for homosexual men to lead boy scout troops, is it then okay for heterosexual men to lead girl scout troops?

***end edit

In the last few posts, including this one, I have tried to be non-judgmental. I am not trying to make judgments as to what is correct, I am merely trying to explain reality in a way that is not usually covered. The "media" prefers jargon and deception over reality and clarity. Reality is uncomfortable. Discomfort makes people change the channel.

So here are the solutions that I see society chosing:

1) The boy scouts chose to divide by sex and by gender, and those that cannot be divided by both are excluded.

2) The military choses to divide by sex and by gender and forces those that don't fit the gender mold to keep quiet about it. If no one knows that PFC Smith is gay, they will not be uncomfortable around him, and the only one that will be uncomfortable is PFC Smith.

3) Many organizations divide by individual persons: private dressing rooms, private showers, private everything. I would say that this approach ignores sex and gender distinctions.

4) The last option is to completely erradicate sex and gender altogether. I do not mean that sex and gender are ignored, I mean that they are denied. Here are two examples. At the U of M incoming freshmen can sign up to be paired with a random opposite sex roommate. New York City recently passed legislation that allows residents to change the "sex" on their birth certificate. There are countless books that seek to prove that sex and gender are wholly social constructs and can be denied and forgotten.

Slave Traders

2006-11-02T09:10:00.000-06:00

Mayor Daley signed a deal with Morgan Stanley. Morgan Stanley now has a 99 year contract to run a parking garage in Chicago. This has been in the works for some time and the mayor is excited to put this facility in private hands to manage. There's one catch. Morgan Stanley is a fairly old company that at one time profited from the slave trade. The city of Chicago has an ordinance that restricts its business with companies that benefitted from the slave trade. Mayor Daley is responding by doing what Mayor Daley does best: ignoring the problem and doing what he wants. (Addendum 1: I heart Mayor Daley)
Personally, I think this is ridiculous. Here's why:

1) Usually when companies are punished the intent is to correct behavior. Liquor licenses are suspended until strict ID policies are enforced, restaurants are closed until they get rid of rats, etc. In this case, there is no way for a company to correct past behavior. The result is that current employees are punished for actions they weren't responsible for and can't correct.

2) While I don't work for Morgan Stanley's HR department and I don't know the backgrounds of all their employees, I will assume that there are at least some African Americans that work for the company, and it seems pretty sick to punish these people for having "benefited from the slave trade". (Addendum 1: we might also consider the many African-American shareholders of these companies that will also be punished for "benefitting from slavery".)

3) Perpetual censorship for slavery is not about justice, it's about bitterness. There's a lot to be bitter about, but the past cannot be undone and the resentment can never be soothed. It seems to me that the only effect of these policies and ordinances is to perpetuate a cycle of hate. Considering the lawbreakers are all dead, the only One that can deliver justice is the Lord, which is appropriate since He is the only One entitled to vengeance.

Addendum 1:

4) For several hundred years slavery was legal. The slave trade was made illegal, and then ultimately slavery was made illegal. There should be a clear distinction between companies that benefited from slavery, and companies that benefited from illegal slavery. I have never heard anyone make this distinction, but it is important to consider that most companies that benefited from slavery did so within the boundaries of the law. If the benefits from slavery were not illegal, how can we take legal action against them? If you want the American legal system to deliver divine justice... well, it's not going to happen.