[glenn.jacobs]

Ron Paul has a great chapter on Israel and Zionism in Liberty Defined.

[glenn.jacobs]

Vampire,
Yes, legal tender laws should be repealed and individuals should be free to trade with whatever they wish. That being said, we should differentiate between a 100% gold coin standard and the faux gold exchange standards. I agree with you absolutely that the State should not be at all involved in monetary affairs.

[glenn.jacobs]

Look at the so-called trade deficit. As commentator Charles Goyette often points out, when we buy something from China, it took the Chinese real labor and real effort to make the product. The dollar which we exchange is, at least to some extent, the result of the Fed increasing the money supply. The manufacturer in China cannot spend the dollar there so the Chinese government buys the dollar from him and then either holds it in reserve or buys US treasuries with it.

In addition, the world’s oil is currently priced in dollars. This is the result of an agreement between the US and Saudi Arabia. Thus, to buy oil, OPEC customers must first buy dollars from the US. The country which receives the dollars will then either deposit them with a US commercial bank, hold them in reserve, or buy US treasuries with them (or perhaps invests them in the US through a sovereign wealth fund.)

In any case, the dollar’s status as the world’s reserve currency creates artificial demand for dollars around the world. As Dr. Herbener points out, many of these dollars remain overseas dampening price inflation domestically, but often leading to higher prices in other countries as illustrated, for instance, by the rising price of food which was one of the contributing factors to the “Arab Spring.”

[glenn.jacobs]

Since market conditions are perpetually changing, successful entrepreneurs are those who can adapt and take advantage of these changes. In some cases that probably will mean that the rich will get richer since their ability to create wealth relies on this trait to begin with. However, in many cases these changing conditions give other folks opportunities to create wealth for themselves through innovation and fresh thinking.

In other words, the way to get rich and stay rich in a market economy is to produce things that other people want. While there are always going to be some folks who have vastly more wealth than the median average, the market at least gives everyone the opportunity to move up the socioeconomic ladder.

As you point out, it is the political economy that leads to real income inequality. We can find examples in the communist countries. The rulers enjoy a much better standard of living than the ruled. Unfortunately, this is becoming the norm here in the US as well. The Federal Reserve doles out trillions to its minions while the masses are happy with rental assistance and food stamps. Meanwhile, the State imposes regulations that benefit the large, established players while putting the little guy out of business (if he can even start).

If we look at something like intellectual property (IP), it becomes even more apparent that it is the State and not the market that produces economic inequality. For instance, U2’s Bono is known for his philanthropy. However, in the New York Times he wrote an Op-ed supporting State protection of IP. So let’s say that you want to start a radio station somewhere in Africa. According to Bono, unless you have his permission to play his music, you can’t put it on your station, even if you have acquired it in physical or digital form. Way to go, Bono! Thanks to you, the ability of our hypothetical African entrepreneurs to better their lives through economic progress is greatly hampered. Bono says that IP protects fledgling artists. That is bunk! Fledgling artists often release their stuff for free hoping to build a following (as the Mises Institute does with its material). IP protects the established artists and the big production/distribution companies, i.e the rich. (Granted, my Bono example is more complex in real life as we are dealing with contract law, etc. Even some libertarians would disagree with me. See Murray Rothbard or Stephan Kinsella on the Mises website for good discussions on IP and copyright versus patent.)

Patents are another good example. Let’s say you want to start a service that builds cheap replacement parts for appliances. Not only would you benefit, but so would the consumer. Well, you can’t. At least not without getting permission from the appliance makers to do so. What if you have a great idea that would improve some existing technology? Again, you usually have to gain permission from the patent holder.

As we can see, IP does not protect creativity, but it does hamper the ability of new entrepreneurs to improve on existing technology. On the other hand, things like open source software give provide real world examples of how a truly free market would work.

[glenn.jacobs]

I’m 45 and it is folks like you that give me hope. Young people who are actually seeking knowledge and exercising critical thinking. I wish I was your age when I learned the things that you (and I) are learning now.

It sounds sort of melodramatic, but I once heard Sharon Harris from the Advocates for Self Government say that survival of western (liberal) civilization rests with libertarians. I believe that this is indeed the case. So take heart and keep doing what you are doing.

[glenn.jacobs]

Sons of Liberty is right. I don’t think that reading one book will cause the proverbial light to switch on. It’s more like each book draws you closer to the light.

I was always a political nomad. At various points in my life, I considered myself a liberal or a conservative, but I’ve always had reservations and concerns about the positions that both sides took on certain issues. I’ve always been a fiscal conservative, but didn’t believe that the State should be involved in our personal lives so long as our actions weren’t harming anyone else. Likewise, I’ve always considered the Bill of Rights absolutely sacrosanct and was a big civil libertarian, which I thought was a liberal position, but I believed that individuals should be able to keep the fruit of their labor and never bought into the whole “redistribution” of wealth thing.

Then a friend told me that I sounded like a libertarian and encouraged me to check out the Libertarian Party, which I did. I discovered that I agreed with the libertarians on most of the issues and realized that I’d found a home. Although I now understood that there was more to the political spectrum than the Left/Right paradigm, I still wasn’t thinking in terms of philosophy, but rather “do I agree with them on this issue or that issue?”

A few years later, 9/11 happened. That terrible event really motivated me to give politics some hard thought. How could something like this happen? Especially in America? Unfortunately, like Sons of Liberty, I began down the neocon path. However, I did so for what I thought were pragmatic reasons. I’ve always considered people as individuals with equal rights, not as members of some tribe or group who are, by definition, “THE ENEMY!” Hence, I thought that war was a terrible thing, but that it was necessary, although I knew that innocent people would die and I was uncomfortable with talk like “we should turn Afghanistan into a parking lot.” Meanwhile, another part of my mind was still traveling down the libertarian path.

So I read all that I could, listened to podcasts, etc. I found myself more and more drawn towards libertarianism as not only philosophically attractive, but as the only system of politics that would really work. Then I discovered Rothbard and it was all over. I realized that private property anarchy, the stateless society, was not only possible, it is superior to any other political system. And it is the only truly moral arrangement for human society.

In addition to the great books that have already been listed, I’d like to add Mary Ruwart’s Healing Our World: In an Age of Aggression, especially if you want to approach things from the Left. For those interested in hard numbers and empirical examples, there is Harry Browne’s Why Government Doesn’t Work which resonates with our friends on the Right. I’d also like to recommend Richard Maybury’s Uncle Eric series, especially for young people. The drawback with the Uncle Eric books is that each short book covers a single topic and they are a little expensive, so accumulating the entire series can be a somewhat pricey.

[glenn.jacobs]

Unfortunately, the media has created a false argument based on the assertion that only the government can do certain things. We find the same is true of monetary issues. Despite the fact that private money has existed throughout history and successfully so, we are led to believe that only the government can issue currency. In the case of natural disasters, the media buttresses this argument by portraying those of us who argue against government intervention as callous and heartless.

There is a lot wrong with this argument, some of which involves the “unseen.” For instance, we hear the debate about flood insurance. Flood insurance is such a great thing because the government will pay for something private insurers won’t. Of course, the obvious question is: why won’t the private insurers cover this particular thing. It’s because they know that they will lose money since floods will inevitably occur. If left up to the market, no one would build in flood areas (or, at least those who could not afford the loss) since you would probably lose vast amounts of money. Instead, the loss is transferred to the taxpayers. Meanwhile, the politicians get to act as saviors.

The situation with Sandy is somewhat different, but I would argue that some of the same incentives apply. I just watched a video on LewRockwell.com of a lady pleading with Chuck Schumer that President Obama had to send help because they were “dying there.” “When is the government going to do something!!” The learned helplessness that our Leviathan state has engendered is absolutely frightening. Folks no longer see it as their responsibility to take cares of themselves because the State is always supposed to be there to take care of them instead.

Then we have the stories of electrical workers from the South being turned back because they don’t belong to a union. We all heard how in Katrina, private relief efforts from organizations like the Red Cross (which is a quasi-government organization) and Wal-Mart were denied entry into New Orleans by FEMA.

The fact is that civil society is quite capable of responding to natural disasters, but, much like in economics, it is either prohibited from doing so or crowded out by the State.

[glenn.jacobs]

Also see the YouTube video “The Philosophy of Liberty” which discusses the concept of self-ownership.

As John Locke wrote in his Second Treatise of Civil Government, “…every man has a property in his own person: this no body has any right to but himself.” In other words, our rights are derived from the fact that you own your body and life. Hence, no other human can claim title to your life, liberty, or property.

[glenn.jacobs]

While I’m not a faculty member, I pursued the website and would like to offer some observations. If I am mistaken by some of my assumptions about what this guy is saying, please forgive me.

First, the biggest problem that I have with anyone who “has a plan” is: what happens if I choose not to participate? In other words, will you use coercion to force me to take part in your plan? If your plan is not based on the free market, the answer is yes and your plan should be rejected out of hand.

Second, we should always be suspicious when the words “mathematics” and “perfect” are used in the same sentence as “economy.” Economics is not a mathematical science. Numbers and statistics are useful in economic history, but not in a prescriptive or predictive way. And the economy can never be perfect. The economy is a dynamic system, always imperfect, but always moving towards a greater degree of perfection or equilibrium. It never achieves this state since conditions are always changing. The Evenly Rotating Economy is great for understanding how the economy works, but it is an imaginary construct which holds no validity in the real world.

Third, this guy seems to be completely ignorant of the role interest plays in market economy. Interest is a necessary and vital component of the market. Without interest, there would be no lending. Without lending, there would be no concentration of capital. Hence, a very small division of labor and specialization. Yes, the State concentrate capital with its chosen recipients, but it can only do so by 1) increasing the money supply or 2) taking it from someone else and thus destroying their capital. In addition, the interest rate provides entrepreneurs and investors with important signals that help to effectively allocate resources. The problem with interest today is that the interest rate is fixed by the State or its proxy the central bank. This is simply another form of price controls. It also seems that the gentleman is confused by interest and price inflation as he keeps talking about how much more things like houses cost in dollars than they did 30 or 40 years ago.

Fourth, the gold standard is not perfect, but so long as the State is going to be involved in monetary affairs, something like the gold standard is necessary to impose discipline on government spending. Monetary and price inflation in the US really took off after Nixon closed the gold window in 1971. Austrians do not believe in a gold standard per se. In general, we agree with Hayek that the market will determine what the best money is. As with everything else, the market is vastly superior to central planners. Trusting the State to issue fiat currency without any checks is bound to lead to disaster. While this disaster may manifest itself in different ways, once you come to the root of the problem THIS is the reason that the world is in the situation that it is.

Thanks!!

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