Tag Archives: statist

Leave Those Kids Alone

The song from which this post takes its name was a protest against English public schools, which were used in that country to crush young spirits and enforce a heinous caste system. At this point, it is impossible for any thinking person to support state controlled schools. Thinkers on all sides and throughout history have come to the same conclusion.

  • They don’t want well-informed, well-educated people capable of critical thinking. They want obedient workers, people who are just smart enough to run the machines and do the paperwork – George Carlin
  • Schools train you to be … a usable victim for a military industrial complex that needs manpower – Frank Zappa

Mr. Carlin, above, recorded perhaps the best ever statement of this problem. It’s worth spending three minutes on YouTube to hear the whole piece. Jeremiah’s favorites are the thinkers who identified this as a general problem regardless of political alignment.

  • State education is a mere contrivance for molding people [into] that which pleases the dominant power in the government – John Stuart Mill
  • Too much state control in educational matters is a fatal danger to freedom, since it must lead to indoctrination – Karl Popper
  • We have not yet developed a system of education that is not a system of indoctrination – Doris Lessing

Finally, we have two quotes from dictators who were candid about their intentions. Especially creepy is the idea that the young victims will be incapable of thinking critically. They are to be mentally maimed.

  • The schools must fashion the person, and fashion him in such a way that he simply cannot will otherwise than what you wish him to will – Johann Gottlieb Fichte
  • Give me four years to teach the children and the seed I have sown will never be uprooted – Vladimir Lenin

For America to be successful, and meritocratic, we must ensure that all children have access to good education – but we must not trust the state to provide it. The state will use the schools for indoctrination instead of education, which may be why American schools are the world’s most expensive.

Delegating education to the private sector would make it more efficient, but there is no guarantee that corporate messaging would not find its way into the schools – substituting one form of indoctrination for another.

This problem does not have a ready solution, but there is a clear mechanism for finding a solution. This is an important technique for setting policy. You don’t always need a ready solution. Only statists believe that policy makers have all the answers. What you need is a mechanism for finding a solution.

In this case, the mechanism is to enlist parents in fixing the schools. Ensure that the state will pay for public schools, private schools, charter schools, online schools, home schools, and even religious schools – and allow the parents to choose.

Initially, there might be wacko schools teaching dogma instead of arithmetic, but these would fail rapidly. Parents will reliably move their kids into the most effective schools. They are the group best equipped to find a solution, and they should have the power.

See also:  Backpack funding puts focus on students

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Guilt by Association

Jeremiah is fiscally conservative and socially liberal, so there! Regular readers know the centrist position to be more nuanced, but we wanted to cop to what Salon calls the most childish political position ever. The online debate is here, and the latest attack is Greta Christina’s article.

Christina starts plausibly enough, with the assertion that social issues are inseparable from fiscal issues. Unfortunately, her attribution of social problems to fiscal policy relies heavily on stereotyped “conservative” positions and simplistic policy analysis.

Even if you, personally, oppose racist policing, supporting fiscal conservatism makes you part of the problem.

She tells us, for example, that “fiscally conservative means slashing support systems that help the poor, lowering taxes for the rich, cutting corners for big business, and screwing labor.” Seriously, have you ever heard anyone claim those as policy objectives? Who’s being childish here?

Christina simply enumerates policies that are presumed to help the poor, and which fiscal conservatives resist – public education, unions, and the minimum wage, among others. She overlooks the first rule of policy analysis, which is that there are no unalloyed goods. Unions do not always help the poor. More often, unions keep the poor locked out of jobs. So does the minimum wage.

You may feel that the government should spend more on public assistance, and pay for it by raising taxes. Never mind about balancing the budget, or how narrow our tax base is. Do you really want the federal government to have all this power? Why not state governments? Does government have to administer, say, education – or can it simply send a check?

People can reasonably debate these issues, but Christina doesn’t. She has her official list of bad policy outcomes, and she proceeds to attribute all of them to the “fiscal conservative” straw man. This is precisely why good debate avoids the use of labels. You need to look at the actual policies, not the label. Ironically, the last time Jeremiah inveighed against a label, it was socialism.

If there is a general principle called “fiscal conservatism,” it is that big, government directed programs are to be avoided. This definition places many of Christina’s bad outcomes on the other side of the fence. We covered the prison situation here. It is the result of incompetent government and … an irresponsible trade union. The drugs war, likewise, is a big (expensive) government program.

Fundamentally, Christina is undone by her thesis. Fiscal conservatives are obviously different from social conservatives. The people are different, the objectives are different, and the policies are different. To show that the outcomes are somehow correlated would take a lot more evidence than the “all conservatives are alike” argument presented here.

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There Ought To Be a Law

Have you ever seen a motorcyclist riding without a helmet, and thought to yourself, “that dumb bastard – that ought to be illegal?” If so, you might be a statist. Statism is a policy preference for controlling people’s behavior by law. Liberalism, in the classic definition, is the idea that people should be free to do as they please, unless their actions impinge on others.

20150210_statismThe motorcyclist is a policy grey area. If he doesn’t have medical insurance, then his carelessness could become a cost to society. The way to fix that is not to require a helmet, but to require insurance. Seat belt laws are similar, and gave us one of the all-time great statist slogans, “it’s not just a good idea – it’s the law!”

Your family and friends may grieve if you crash through the windshield, but – is that the government’s business? What about side impacts and immersions, where the seatbelt becomes a hazard? Is the government responsible if a regulation causes your death? Jeremiah knows someone personally whose life was saved by not wearing a seat belt.

These are trivial examples, but you can see the progression. What about a woman’s right to an abortion? What about cancer patients who wish to try unorthodox treatments? What about keeping your kids out of public school? Smoking pot? Drinking raw milk?

Statism is, at best, a form of policy laziness. Every problem can be solved simply by more mandates and more limitations on personal freedom. Let’s take vaccination as an example, because it actually does present a case for state intervention.

If you omit to vaccinate your kids, they will likely be protected as long as everyone else vaccinates theirs. Other families incur whatever costs and risks are involved, and you ride free. This is what economists call a “commons” problem. A commons problem cannot be solved by free exchange and rational self-interest. Some kind of mandate is needed.

There is a broad and complex spectrum of parents who are vaccine-hesitant or vaccine-uncertain. The common thread among all parents is that they’re trying to do what they feel is best for their children.

So, why do people resist? They deny the science and resist the mandate because they distrust the federal government. The federal level is simply too high, and a federal mandate too broad, to persuade parents that their health concerns have had a fair hearing. A vaccination mandate at the state level would have more credibility. This might be less effective but, as long as each state had some kind of standard, it would be adequate.

The logical unit of legislation for this issue is maybe the school district, or even the individual school. Here, we run into the related problem of federal intervention in local education policy. Imagine, though, that there is a free market for primary education (it’s easy if you try). In this system, parents would choose where to send their kids – according to a variety of factors, including health standards.

If one school is lax on vaccinations, parents won’t want their kids going there. They’ll demand to know that all the kids have had their shots. If the Christian Science school eschews vaccinations entirely, parents will note the occasional outbreak – and draw their own conclusions. At the other extreme, schools that go overboard may encounter some of the side effects feared by the anti-vaxxers.

Remember that this is not an all or nothing decision.  There are several different vaccines that can be organized into a variety of schedules. Over time, schools and parents would discover which schedule provides the best mix of costs and benefits.

This is an organic, grass roots, style of decision making. It assumes that people are capable of taking responsibility and making their own decisions. It contrasts with the top down, “command and control,” approach favored by the statists.

The vaccination example shows two principles of the liberal approach, 1) delegate the decision to the lowest possible administrative level, which might be the individual, and 2) match the costs to the actual outcome. The first principle should be pretty clear, and it is referenced in the Tenth Amendment.

The second principle says that the people who use a bridge, pay for the bridge. The toll should exactly support the bridge’s operation and maintenance. If you want to ride without a helmet, you should pay the actuarial cost of a typical head trauma. If you do or do not want to vaccinate your kids, the result should be confined to your group of likeminded families.

Statism starts with banning sugary drinks (for your own good) and then we start down a slope that includes telling the neighbors how to raise their kids – and going to the police if they disagree. Censorship and surveillance are part of the program. Statists believe that they know what’s best for you, and the police should enforce it.

State control of personal decisions flows together with state control of commerce. Together, they form a powerful central bureaucracy, rich with opportunities for cronyism and corruption. Most statists are simply busybodies who enjoy telling others what to do. The leaders, though, are in it for money and power.

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New World Currency

This article in Huffington Post uses the term “new world order” in a novel (and optimistic) sense. Jeremiah has been warning that America will lose our dominance in international finance, and now it is happening. Punitive fines, sanctions, and currency wars are driving the world out of our currency zone.

A multi-polar financial world with new international financial centres emerging in Mumbai and Shanghai will be a more stable world.

The term “new world order” is generally used to describe a conspiracy, in which an international elite aims to create “one world government” with themselves at top. See here, for example.   The new world order described by Dr. Saidi is actually the antidote for one world government. Such are the pitfalls of using labels.

So, what about the new world order of one world government? Does that sound like a good idea to you? As always, we approach the theory by assuming that it is rational – and not a conspiracy.

We alreSorosady have a raft of supranational institutions like the IMF, the WTO, and the UN. The European Union aims to “transcend” the national governments of Europe, and already controls their currency. The leaders of these institutions may reasonably believe they’re doing the world some good. It’s human nature to believe that your outfit ought to have more funding, and more power.

Globalists, like George Soros and his various think tanks, believe that national governments are obsolete. They deny wanting a world government, but they want every issue – from welfare to monetary policy – handled by a global body.

Insofar as there are collective interests that transcend state boundaries, the sovereignty of states must be subordinated to international law and international institutions.

This amounts to world government, for all practical purposes. It promises an end to war, poverty, pollution, etc. People with this much faith in government are statists, by definition, and they believe in utopia.

SutherlandJeremiah does not have that kind of faith. He believes that the more power and personnel a government has – any government – the more despotic it will be. World government, therefore, would be a giant prison with no hope of escape, like The Hunger Games.

With globalism, as with socialism, we don’t want to get hung up on the label. We want to look at specific policies. For example, Soros and his crew want the IMF to issue the world’s reserve currency. This is obviously the enemy of human liberty. Just look at what happened to Greece, with the Euro.

This brings us back to Dr. Saidi and his multi-polar world order. We can no longer hope for the dollar to retain its reserve status. Failing that, we would rather have competing national currencies than a “new world currency” controlled by the IMF.

See also:  CFR Global Governance Program

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Price Discovery

The Justice Department has intervened to block the merger of US Air and American Airlines.  A spokesman said that blocking the merger would help keep fares low, for the benefit of customers – at the expense of shareholders and creditors.  It is tempting to believe that markets can be managed this way.  If we can screw the capitalists, for the benefit of workers and customers, maybe we should do that all the time.

Government intervention, however, cannot make a lasting change in the price of air travel.  Everything has a market clearing price, to which it will revert.  If there is any guideline for government regulation, it should be to remove distortions that block price discovery – not create them.

Since 1981, the airline industry earned meaningful economic profits only in 1984 … and since 2000 the industry has failed to cover its cost of capital.

The Justice Department apparently doesn’t believe in price discovery, and this is a good opportunity to show how It works.  If the merger were going to create a monopoly, or a cartel with the power to fix prices, that would push airfares above the true price, and the government would be right to intervene.  This is why we have clear laws against monopoly and price fixing.

Airlines

The airline industry is far from monopoly.  On the contrary, it suffers from overcapacity.  The chart here is from Oliver Wojahn’s report to IATA.  American is bankrupt, which is why the DOJ statement refers to creditors as well as shareholders.  Too many aircraft chasing not enough customers is certainly a formula for cheap fares, but you can imagine the consequences.  Service will suffer, safety will suffer, and eventually one or more airlines will go under.  Then, fares will revert to their true price.

All three labor groups representing American employees, including pilots, flight attendants and mechanics, backed the plan put forward by US Airways to merge the airlines.

France is farther along the interventionist path.  Their government is forcing factories to stay open, and operate at a loss, in order to keep workers employed.  This certainly screws the capitalists – there are factories in France they can’t give away – but it’s only temporary relief for the workers.  No one will  invest in capital improvements, and the factories will run down.

This is why airline workers support the merger.  Many people, including Joseph Schumpeter, Nassim Taleb, and the airline unions, recognize that trying to prop up a failing enterprise will only make things worse.

There is also a moral hazard that goes with government intervention.  Sure, we all want to screw the capitalists, but what happens when the government decides to screw American and not United?  Steve Wynn, but not Warren Buffett?  Do we favor the workers, or the customers?  Plus, not all creditors are evil capitalists – they are also widows and orphans and pension funds.

It is hubris to think that government can – or should – pick winners and losers in the economy.  The right way to screw the capitalists is simply to tax them, and leave business alone.

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Veto Partisan Health Bill

There is no good reason to pass costly healthcare legislation this year, with the economy in recession and the federal budget in a record deficit.  The only reason is a craven, partisan one.  House Democrats, led by Speaker Pelosi, have the votes to push the bill through despite conservative objections.

Ms. Pelosi, furthermore, refuses to let go the “public option.”  She and her followers are committed to this idea because they fundamentally mistrust the free enterprise system.  Senator Joe Lieberman – an independent – said it best:

I don’t remember another case where our answer to a concern about fairness in the marketplace — in this case whether there is real competition in the health insurance business, whether the health insurance companies are being fair in their rates, et cetera, et cetera, all important, reasonable questions — I don’t remember another case where the answer to that was to create a government-owned corporation to compete with the private sector.

Right now, the only brake on the House – and their statist approach – is the Senate.  Many Senators, including Democrats, do not support “public option.”  But the House thinks President Obama is desperate, and will sign anything.  He needs to show America that they are wrong.  A responsible leader does not sign landmark legislation without bi-partisan support.  President Obama should send Ms. Pelosi back to the drawing board.

See also: Jeremiah’s four laws of public spending.

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Too Big To Fail?

By now everyone knows the compensation plan that caused the financial crisis.  It’s called “heads I win, tails you lose.”  Investment bankers make big bets, using whatever instruments escape SEC scrutiny.  If they win, they’re masters of the universe.  If they lose, Henry Paulsen covers their bets – and their bonuses – using taxpayer money.

If an airline or a car company takes on too much debt, makes risky investments, and overpays its executives – it goes under!  The well-run companies take over.  So, why squander $700 billion on failed banks?  Because failing financial institutions can damage the whole system.  The bankers, in effect, hold the real economy hostage.

The Bush administration initially papered over the crisis with some success, rescuing Merrill-Lynch and Bear Stearns.  When they randomly allowed the next one, Lehman Brothers, to fail, markets tumbled.

Treasury Dept

The Bush administration was characterized by lax financial regulation, for which Obama’s statist approach overcompensates.   Heavy reserve requirements and new regulatory bodies are not required.  The Fed does not need new responsibilities – or to become politicized.  Pay caps are a populist gimmick.

The answer is not to prevent banks failing, but to prevent failing banks from damaging the system.  Regulators must be on the lookout for systemic risks – using antitrust laws to break up big banks, and restricting dangerous instruments.  AIG failed because it had a “monopoly” on bad debt.

Secretary Geithner should explicitly remove all government funding, support, and guarantees from the private banking sector.  He should sell off Fannie and Freddie, bring back Glass-Steagall, and generally let the banks know they’re gambling with their own money.

Aerialists working without a net have a surprisingly enhanced ability to stay aloft.

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