The Long, Ugly Road to Libya

 | 

The Arabs and the West Europeans got us into Libya, yet once again we’re the ones who apparently will do most of the heavy lifting.

Airpower has prevented Qaddafi's forces from taking Benghazi and crushing the rebellion. A no-fly zone can be maintained without major losses. However, unless someone close to Qaddafi happens to kill him, he could maintain himself indefinitely in the western half of the country. If he survives, Western advisors, arms, and training will be needed — at a minimum — in addition to air cover, if the rebels are actually to win.

But exactly what will emerge after a rebel victory? That is anybody's guess.

And that’s enough, I think, to be opposed to our intervention.

Now consider Obama's position. The Arab League and America's NATO allies wanted intervention. Critics ranging from John McCain and the buffoons at Fox to insipid leftists like Nick Kristoff were maintaining a drumbeat for intervention, aided by the media generally, which was pumping out stories about the suffering of the innocent rebels and their kin.  Reagan and Eisenhower, and JFK after the Missile Crisis, had the cred to say, "No, not our business." (Whether they would actually have done so about current events in Libya is another matter.) But Obama doesn't. And while I don't believe he's a moral coward, he doesn't have the guts to say that we simply can't afford this.

The basic fact is that the moving forces in our society — in the media, in political circles, and to an extent in the international business and finance community, think we should police the world, or at least those parts of it that they care about.

Funny, isn't it, that there's a civil war in the Congo that has killed more people than any other war fought since World War II, yet nobody discusses doing anything about it. On the other hand, boy Clinton just mentioned that we should have intervened to stop the Rwandan genocide — although he found reasons not to do it when he was president. Left and Right alike in this country want to spend our blood and treasure around the world. They sometimes disagree about where in the world, but the philosophy is the same.

It's a drug we got hooked on after World War II. If there's a problem, we feel an urge to go "solve" it. We’ve never learned the solution to the urge itself: don’t intervene anywhere unless the lives, territory, or truly vital interests of the American people are involved. It's the interventionist philosophy, combined with the thoroughgoing welfare state created by LBJ and his zealous accomplices that has brought us to the brink of bankruptcy. We spend ourselves  —  economically, emotionally, morally  —  crusading abroad, when we should be conserving our strength and building a better society here at home.




Share This


How to Hunt RINOs

 | 

A valuable lesson in how to purge the Republican party of big spenders of other people's money (aka RINOs, “Republicans in Name Only”) has been taught to us all by the voters in Miami-Dade County, Florida. They just voted to recall their mayor, one Carlos Alvarez, RINO extraordinaire.

Alvarez had been reelected in 2008 by a large majority. What caused the recent shift in voter sentiment? He pulled a typical RINO stunt after his reelection: he agreed to a plan that raised property taxes sharply and gave even more money to unionized public employees. He went along with raising the employees' pay and unfreezing their benefits, and covered it by jacking up property taxes on two-fifths of property owners by an average of 13%.

Alvarez had earlier agreed to hand over copious quantities of taxpayer cash to build a new baseball stadium for the Florida Marlins.

This struck the voters as profligate and insulting, considering that the jobless rate in the county is 12%. The property taxes used to reward the public employee unions, and the multimillionaire athletes and team owners, are coming out of the hides of people struggling to pay their food bills.

The recall campaign was funded in part by a wealthy businessman angered by reckless spending. Alvarez was voted out by 88% of the votes cast. Good riddance to a gross RINO.




Share This


The Liberty Dollar: An Update

 | 

Bernard von NotHaus, creator of the Liberty Dollar, was convicted in federal court in Statesville, N.C., on March 18. The Justice Department said he was found guilty — not of counterfeiting or of fraud, neither of which he was accused of, but “of making coins resembling and similar to United States coins; of issuing, passing, selling, and possessing Liberty Dollar coins; of issuing and passing Liberty Dollar coins intended for use as current money; and of conspiracy against the United States.”

Readers of this story in Liberty (“Attack on the Liberty Dollar,” March 2008) would have had little doubt of the outcome. The federal code, 8 U.S.C. 486, says:

“Whoever, except as authorized by law, makes or utters or passes, or attempts to utter or pass, any coins of gold or silver or other metal, or alloys of metals, intended for use as current money, whether in the resemblance of coins of the United States or of foreign countries, or of original design, shall be fined under this title or imprisoned not more than five years, or both.”

Von NotHaus always asserted that Liberty Dollars were lawful, arguing that the Constitution’s grant of power to Congress to coin money was not exclusive; that in the 1800s private mints were allowed to issue precious-metal currency, and that Liberty Dollars were not “coins” because they were not legal tender. Given the law cited above, none of these arguments was likely to persuade a federal court. In that sense von NotHaus was much like the tax protesters who argue that the federal income tax is illegal, or unconstitutional, or that it’s voluntary, and who try to win their arguments by asserting in a louder voice and a higher tone that they are right. These people invariably lose. It takes a while, because the government is slow, but it eventually gets them.

In announcing its victory, the Justice Department made its own political statements. According to US Attorney Anne Tompkins, “attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism. While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country. We are determined to meet these threats through infiltration, disruption and dismantling of organizations which seek to challenge the legitimacy of our democratic form of government.”

Trying to trade a privately minted coin of 999 fine silver for goods or services is hardly terrorism. Who would be terrified by it?

Liberty Dollars were indeed an attempt to undermine the public’s faith in US dollars, but they were never a “clear and present danger” to the Treasury, because no bank ever accepted them, and under the regulated system we have, no bank was ever going to accept them.

Von NotHaus’ organization was an economic venture set up to earn money — US-dollar money. It could sell Liberty Dollars at a profit into the collectible market, because the coins are beautiful and are of pure metal, and because of the political statement they make. (Several versions replace Miss Liberty with the head of Rep. Ron Paul.) But as a circulating currency, the Liberty Dollar was a failure. Probably it had the most success around Asheville, NC, where it had a diligent agent who is now facing prosecution as well. But he made such a poor living at it that he had to give up his storefront and operate out of his house.

The Liberty Dollar was a political act, a statement by a libertarian that he would offer the people a currency of valuable metal, now that the Treasury no longer did. Von NotHaus said as much, and he ambitiously named his company the National Organization for the Repeal of the Federal Reserve and Internal Revenue Code. He did this openly. An act of civil disobedience? Yes. But a conspiracy? My dictionary defines conspiracy as “a secret plan to commit a crime or do harm, often for political ends.” There was nothing secret about the Liberty Dollar. Von NotHaus took as much publicity as he could get.

For all the various counts he has been pronounced guilty of, Von NotHaus, 67, could be sentenced to as many as 25 years in prison and a fine of $250,000. The federal government is also asking the court for the 16,000 pounds of copper and silver Liberty Dollars and precious metals it seized, said to be worth nearly $7 million.

As I write, the “buy it now” price on eBay for a 1-ounce 999 silver Liberty dollar denominated at $20 is $50.




Share This


This Could Be the Start of Something Big

 | 

The first battle of the 2012 campaign has just ended — and it doesn’t bode well for the Democrats, in the short run at the state level, or in the long run at the federal level.

The location was Wisconsin, historically a stronghold of organized labor, the Democratic Party, and the Left generally. But the state has been trending rightward in recent elections, and last year it elected a Republican, Scott Walker, as governor, and a majority of Republicans to the state legislature. Interestingly, however, these are not the sort of Republicans you would expect from a somewhat purple state — RINOs (or Republicans in Name Only) — but honest-to-God RCCs (Republicanos con Cojones).

Governor Scott Walker clearly has a pair. During his campaign, Walker made it clear that he was serious about reducing spending, especially the outrageous compensation packages that public employee unions had negotiated in sweetheart deals with past Democratic administrations. The pattern in Wisconsin was similar to what happened in most other states: a vicious cycle of crony unionism. Public employees unionize, use their massive dues to elect sympathetic politicians, then in bargaining with those politicians receive lavish compensation packages. This enables the unions to collect even more dues, elect even more sympathetic politicians, and get even more of the taxpayers’ dollars. It’s very convenient — for the unions.

In the 2008 election cycle, unions (now predominantly unions of government employees) gave about $400 million to Democratic campaigns, especially Obama’s. Heck, AFSCME (the American Federation of State, County and Municipal Employees, the biggest government workers’ union) alone gave the Dems $90 million during the last (i.e., 2010) election cycle.

The public choice tipping point occurs when the pain inflicted on citizens by the rentseekers who have captured a government agency becomes too great to ignore.

So the money that taxpayers pay in salaries to the public employees provides (in the form of union dues) the funds that elect politicians who will in turn raise taxes and give more money to the public employees (and hence their unions). The public, rationally ignorant — that is, having better things than state politics to worry about (such as earning an honest living) — are typically oblivious to the corruption, until the deficits and taxes become outrageously high. That point, which you might call “the public choice tipping point,” occurs when the pain inflicted on the citizens (in increased taxes, increased costs of compliance, or decreased liberty) by the rentseekers who have captured a government agency becomes too great to ignore.

Perhaps the classic illustration was the transition to the all-volunteer army. We kept the draft going from World War II through the Korean War, and long past. It took the debacle that was Vietnam and the student protests it aroused to get the government to change from conscription to a volunteer services model.

Governor Scott took office with the state deficit already at $137 million, but slated to rise to $3.6 billion in the next two years. As he promised during his campaign, he introduced legislation that requires the state employees to contribute more to their health and pension funds. Specifically, his law requires public workers to pay 12.6% of their healthcare insurance premiums from their pay, and contribute 5.8% of their pay to the pension system — an amount that is still quite low compared to similar amounts in private industry.

In so doing, he went to the heart of the state’s fiscal woes. The public sector unions had sweet compensation packages, ones that include not only high pay but also incredible perks (tenure, virtually free healthcare, and pension plans requiring little employee contribution). The average compensation for Wisconsin public school teachers is over $101,000 per year — for essentially eight months of work.

But Walker also proposed to eliminate the power of government workers (except firefighters and police officers) to bargain collectively for non-salary compensation, and eliminate the state’s role of “enforcer” in collecting dues from employees for the union. His legislation further required annual union elections, in which a majority (as opposed to a mere plurality) of workers must approve the union.

Here, Walker showed real understanding of the problem: if he just asked for increased employee contributions to their health and pension plans, the unions might have gone along this year, but the minute the public’s attention was diverted, they would just get those concessions rescinded, especially if union dues elected a Democratic governor. Government worker unions fully understand rational ignorance.

A recent report shows that fully two-thirds of eighth-grade students in Wisconsin’s public schools can’t read proficiently.

Initially, the unions fought all the provisions of the law, but as the public learned about the lavish compensation packages government workers receive, public sympathy evaporated. Also responsible for reducing taxpayer sympathy was the report that emerged, just as the controversy was getting intense, that fully two-thirds of eighth-grade students in Wisconsin’s public schools can’t read proficiently. According to the US Department of Education, in last year’s National Assessment of Educational Progress tests only 2% of Wisconsin eighth-graders scored as “advanced” in reading, and only 32% as “proficient.” The remaining 66% were below proficient (44% rated “basic,” 22% “below basic”).

The taxpayers of Wisconsin have paid exorbitantly for this laughably lousy quality of education. They pay more per public-school student than any other Midwestern state.

So the unions modified their demands. They said they would agree to increased contributions to the healthcare and pension plans; they claimed that they objected only to the loss of collective bargaining “rights” — allegedly “natural rights” as fundamental as free speech. And with their PR plan in place, they went to war.

The unions employed all their classic tactics. Of course, teachers called in sick en masse, cancelling classes and snarling the schools. There were weeks of massive demonstrations, with as many as 100,000 demonstrators on the streets of Madison, occasionally closing the capitol down, with the usual chanting, screaming and pushing, all aimed at intimidating Walker and the Republicans into submission. Many of the demonstrators were paid for and bused in by the unions in a classic display of “astroturfing.” The protestors were egged on by the usual repellent, aged leftist icons, from Jesse Jackson to Michael Moore to Susan Sarandon. And the unions paid for endless ads aimed at demonizing Walker and the Republicans in the legislature.

In the meantime, the Democratic state senators left the state, in order to deny the Republicans a quorum for considering the governor’s legislation.

Also in the fight — while of course pretending to be above it all — was President Obama. He clearly viewed Wisconsin as the first battle in his reelection campaign, and promptly accused Walker of “assaulting” workers’ rights.

Against this formidable array of foes and this well-strategized campaign, Walker stood firm. After an extended period of what seemed like stalemate, the Republicans figured out how to separate the essential restrictions on unions and make them legislation not requiring a special quorum. They passed the legislation, and Walker signed it into law. The deed was done.

Walker took a major hit in his poll numbers, yet his victory should worry the Dems about the next election, and elections thereafter, at least at the state level.

One cause for worry is the fact that in the battle of Wisconsin the unions had to expend a lot of money — for ads, for demonstrations, for agitprop in general — cash that now isn’t available for the 2012 election cycle. Second, they face a loss of membership. Average yearly union dues are in the range of $700 to $1,000 in Wisconsin, and now that the government won’t be deducting those dues, members may decide they no longer want to pay. One suspects that fear of lost members and members’ dues is what really drove the unions to fight so furiously.

Many of the demonstrators in Madison were paid for and bused in by the unions in a classic display of “astroturfing.”

If similar battles occur in other states, such losses will bite the unions hard. And it may well happen. After all, if the economy in Wisconsin responds well to Walker’s actions, he will rise again in the polls, and that would encourage other governors to follow his lead. Indeed, similar battles have already been going on elsewhere. In Ohio, Republican Governor Kasich is trying to limit public employee bargaining “rights” and is facing demonstrations because of it. In Indiana, Republican legislators have introduced right-to-work legislation that will apply to all unions, and they also saw their Democratic colleagues walk out the door. (While Republican Governor Mitch Daniels doesn’t support this right-to-work movement by his colleagues in the legislature, he did manage to get a law restricting the right of public employee unions to bargain collectively back in 2005).

Republican leaders at the state level — in the face of burgeoning state budget deficits now totaling about $125 billion for the 50 states — seem to appreciate the urgent need for measures that limit the power of unions to game the system. The three most effective measures appear to be laws limiting the collective bargaining privileges of public employee unions, right-to-work laws allowing all workers the right not to be forced to support their unions, and paycheck protection laws that require unions to get the explicit consent of workers before using their union dues for political purposes. These types of laws are kryptonite to the unions.

All of this raises an interesting question. Why are Republican leaders suddenly so bold at the state level, but still so timid at the federal level? Why are some state Republicans willing to address growing deficits in their states, even at the cost of taking on the special interest behemoths that are the unions, while Republicans in Washington seem reluctant to address the federal deficit, which dwarfs into insignificance the state deficits?

A number of reasons explain the disparity. First, the 2010 Republican electoral triumph was manifested more on the state than the federal level. Yes, the GOP took back the House of Representatives, but (because of some unwise voter choices in the primaries, and the large numerical advantage that the Democrats had enjoyed in the Senate before the election) failed to get even a tie in the upper house. You can’t stop a devoutly leftist president — one willing to use the formidable power of the executive branch to keep increasing the size and regulatory scope of the federal government — when you don’t control Congress.

Second, most state constitutions require budgets to be balanced, whereas the federal constitution has no such requirement. This means that to handle the rapidly rising costs of public employee salaries, healthcare expenses, and pension payouts, most states can only raise taxes or float bonds. But taxpayers are already financially stretched to the limit, and bonds are costing more as investors find out how shaky state and municipal finances really are. The recent revelations that states and municipalities already have taken on $3 trillion in bonded indebtedness, and are about $3.5 trillion underfunded in pension and healthcare liabilities, have really hurt the market for muni bonds.

The federal government has a seductive option not open to the states: just print more money. This is of course precisely what the Fed is doing right now.

Add to this the possibility — dare I say the likelihood? — of a bankruptcy in a big city (my favorite candidate is my hometown, Los Angeles). In that event, or the event that a state defaults on its bonds (my favorite candidate is my home state, California), the market for muni bonds would dry up immediately, and with it the ability of states to borrow money at reasonable rates.

The third major difference between the challenges confronting state-level and federal-level Republican leaders has to do with competition. If the politicians in a state jack up taxes to solve a budget shortfall, the productive people (aka taxpayers) and businesses can and will move elsewhere.

This has already had an effect even in such historically high-tax states as New Jersey and New York, where there is now a broad awareness of how many of their productive people and businesses have fled to low-tax havens such as Florida and Texas. The old phrase “Gone to Texas” is now a frightening motto now to the high-tax states.

But the federal government faces no such competition. If I leave California for Florida, the cultural adjustment is minor. To move from America to another nation takes a major adjustment, one far too expensive for most people to make. And most other nations where American might otherwise want to live have equally statist governments.

The fourth major difference lies in the power to print money. Faced with deficits, states have only three options: borrow money, cut spending, or raise taxes. But the federal government has a seductive fourth option: just print more money. This is of course precisely what the Fed is doing right now. It allows all politicians at the federal level to avoid cutting programs and thereby incurring the wrath of special interests.

There is a fifth difference, and it is the most important. On the state level, the Republicans are moving to cut lavish government worker benefits, which are the major cause of the state budget problems, because most citizens are not themselves government workers. The other major choices — raising taxes and cutting programs — are politically unpalatable. Try convincing the average voter that we need to eliminate half the firefighters so that the few who are left can get lavish pay and retire at age 50 on a $250,000 pension for life.

But on the federal level, the programs most responsible for bankrupting this nation are Social Security, Medicare, and Medicaid, not federal employee compensation (or defense spending or discretionary spending in general). Those programs are still popular among Americans, even Tea Party members. A recent poll reported in Policy Review is telling on this point. If you ask Americans where we should cut, the results are dismal. On Social Security, only 9% of the respondent’s would cut it, compared to 84% who would rather increase it or keep it the same. Medicare? Only 12% would cut it, compared to 82% who want to increase it or keep it the same. Medicaid gets only 15% support for cutting, versus 78% who want to increase it or keep it the same. About the only federal project that Americans want to cut is foreign aid.

So in the short term, it is doubtful that Republicans will step up to cut these programs, and if they did, they would probably be hurt politically. But long term, the fiscal crisis that many states are now facing will hit the federal government. The three programs I identified are estimated to face long-term underfunding to the tune of over $100 trillion. As each year passes, their deficits will only balloon. At some point, rational ignorance concerning them will tip into rational knowledge — to the grave damage of the political party that created, expanded, and repeatedly campaigned on them.




Share This


Are Crises Good for the Economy?

 | 

Could Japan’s latest crisis help it economically?

Those who believe in Keynesian economics might answer yes. For them, destruction is creation because it “creates jobs” and otherwise “stimulates the economy.” Taking an opposite, more rational, view economists of the Austrian school would either laugh Keynesian theory off, or if they were more considerate, expound Bastiat’s broken window fallacy: there must be something wrong with the idea that if we all go around breaking windows, somehow we’ll be better off, because the windows will have to be repaired. The problem with notions like this is that we see the creation of a new window; we see money going into the workmen’s hands; but we do not see all the beneficial projects that cannot go forward because the money for them has been spent on mere repairs.

The broken window fallacy notwithstanding, there seems to be something that enables crises to revitalise an economy. While crises destroy wealth, sustained crises also weaken government, a hostile, anti-development institution. It is the latter event that eventually can have a huge favorable affect on society.

This is what India has experienced.

I lived in Bhopal in 1984 when the Union Carbide gas leakage swept the city, killing thousands and thousands of people within the hour. Hundreds of thousands were seriously sick. The same year, Indira Gandhi, the Prime Minister, was killed by her bodyguards, producing a very weak government. Massive Hindu-Sikh riots occurred all over the country. Sikh terrorism in support of the separation of Punjab and troubles in Kashmir kept us on edge for the rest of the decade. Then, in 1991, Rajiv Gandhi, who had just completed his term as Prime Minister, was killed, presumably by the same ammunition that he had supplied to the Tamil Tigers, a Sri Lanka-based terrorist organization. Around the same time, help from the USSR to India ceased, as the USSR ceased to exist. Nineteen ninety-two was a year of major Hindi-Muslim riots all over India. Massacres took place that competed with what Rwanda had experienced in terms of brutality. The economy was in a terrible shape, and India came very close to a default on its international commitments. In short, India was crumbling in 1992 and the government was extremely weak.

Let’s look at what was behind some of these events.

Punjab was not only the breadbasket of India, but huge fund transfers were happening from Punjab to the rest of the country. Supposedly bad elements in the Punjabi society, who had earlier been encouraged by Indira Gandhi, took leadership in the quest for a separate state, and the Indian government’s response was pathetic. Indira Gandhi sent army commandoes to attack and occupy the holy place of the Sikhs, the Golden Temple. A sane approach would have been for the Indian government to cut off the water and food supply to the temple. In that event, the terrorists (if that is what they actually were) would eventually have walked out without a shot being fired. But Gandhi wanted to humiliate the Sikhs. So her humiliated Sikh bodyguards killed her. Thereafter leaders in the Congress Party orchestrated anti-Sikh riots. India was in flames.

When a crisis hits, the first thing that fails and escapes is the government.

(One of the biggest regrets that I live with is the fact that in a fit of nationalistic fervor, I sent all my savings, which for a teenager in a poor country were a mere couple of dollars, to help the families of the dead army commandoes.)

The Bhopal gas tragedy happened in the place where I lived. I was awakened very early in the morning by the sounds of sirens and a smell in the air. Until then, ambulances and fire brigades, if they existed, usually did not use sirens, because they were usually not in working order. The working sirens were on the cars of all the petty politicians and bureaucrats. Reaching the rooftop of my house to see what was happening, I saw a stream of cars with sirens and emergency lights leaving the city — they were all running away. The people of Bhopal were soon to learn that when a crisis hits, the first thing that fails and escapes is the government. Not only were the government and the army (which has a huge existence just outside Bhopal) no longer in sight for a very long time, but given that most of the services — medical, water and electricity, sanitation, banks, intercity transportation and railway — were in the monopolistic hands of the government, it became extremely difficult for the city to get back on its feet. Comfortably sitting hundred of kilometers away from Bhopal, the head of the city was issuing statements that nothing was wrong, while carcasses rotted on the streets. He was making absurd decisions, such as banning the sale of gasoline to stop people from leaving the city.

At the same time, the Indian government was financing and arming Tamil Tigers. Prabhakarn, the Chief of Tamil Tigers, was hosted in Delhi. Starting his pro-Tamil Tigers mission, Rajiv Gandhi sent a naval ship, the Island Pride, a name chosen to humiliate Sri Lanka. It seems, in his naïveté (something that had killed his mother), Rajiv was trying to earn Indian votes. The Tigers, a poisonous snake that Rajiv had encouraged, eventually bit him with his own ammunition.

Given the weakened Congress party, Hindu fanatics were growing in power. They were soon to demolish a mosque in the city of Ayodhya, in 1992. The result was widespread massacres in many parts of the country. Distrust between Hindus and Muslims was at its peak. On top of it the economy was in shambles. It seemed that India would only get worse.

I do not wish to minimize the suffering caused by the events of 1984 to 1992. But in hindsight, it seems that something else was happening. By seriously weakening a cancerous growth, the government, the time of troubles created an opportunity to revitalise the society and the economy. It formed the lurid background of what is now a thriving economy. Indian government, the cancer, never recovered its control over society. The private economy had a breathing space, a space in which it could grow. It was as if a strong chemotherapy had been performed. The government was too confused and lost to control the IT industry, when it began to sprout.

The broken window fallacy is still a fallacy, an irrational approach to understanding economics. Destruction cannot be construction. Massacres are just that. There is no humanity in it. But crises can do one thing very important. While destroying the healthy tissue, they can also weaken the cancer, the government. Crises convey to those who survive the important idea that they must not trust in the government, for government is the first to leave when a crisis hits. Crisis teaches self-reliance.




Share This


Unsolicited Advice

 | 

The current state of our union has generated many opportunities to share libertarian perspectives on the economy, the constitution, and civil rights; but until I picked up the January-February issue of the Atlantic, I hadn’t seen much opportunity for sharing the libertarian outlook on social and personal relations. In that issue’s book review section there was a piece (no pun intended, you’ll get it as you read along) called “The Hazards of Duke.”

The article, by Caitlin Flanagan,loosely discussing several works (Girls on the Edge: The Four Factors Driving the New Crisis for Girls, I Hope They Serve Beer in Hell, andThe Company She Keeps), disparages Duke University (rightly in many ways), discusses alcohol consumption by young women, and pontificates about differences between male and female perspectives on sex. But its main focus (and the lens through which it views the preceding list) is on a relatively recent internet sensation — Karen Owen’s F*** List — a graduate’s mock senior thesis about her sexual escapades with 13 Duke athletes (“officially” titled — “An Education Beyond the Classroom: Excelling in the Realm of Horizontal Academics”).

Flanagan presumes a great deal about Karen Owen and her thesis, telling us much more about her own attitudes than about Owen. Shedivines Owen’s motivation — revenge on the men who discarded her — tagging it as a theme for women through the ages. She also identifies direct causes for Owen’s actions. For example, she cites a letter to Duke’s school newspaper, written in response to Owen’s thesis, and the surrounding controversy, by sorority members distancing themselves from Owen. According to Flanagan, this “served to underscore the disdain that the actual Karen Owen seems to have engendered in her fellow students, whose closed social system offered her no safe harbor.”

After reading Owen’s “brief communications with the press,” Flanagan contends that it’s hard to believe Owen’s claim that the email she sent to “only three friends” was not for public consumption, but it’s “not at all hard to believe that Owen had only three friends in college.” She then weighs in on Owen’s mental and emotional state: “The overwhelming sense one gets from the thesis is of a young woman who was desperate for human connection, and who had no idea how to obtain it.” The author further laments that poor treatment by one of her early partners “broke [Owen’s] heart and her spirit” and sent her on a self-destructive path.

That’s a lot of presumption.

The article describes a Fox News segment, hosted by Megyn Kelly, discussing Owen’s thesis. Not trusting the author for objective description, I watched the Fox News clip online. The segment included Kelly and two other female legal commentators. After discussing Owen’s possible financial motivations, Kelly said, “I gotta go off topic from the law because I have two beautiful women here who are college and law school graduates. What could she be thinking? First of all, she slept with 13 guys. . . . . I personally, reading this, was disgusted.” One commentator responded, “Disgusted, yeah. She’s dirty. Yeah, I don’t like it at all. I was like ‘Oh my God,’ this is so unbecoming.” After more banter, Kelly said, “I can tell you, having dated the captain of the lacrosse team at Syracuse, men do not respect women who do this.” She added, “You may sleep with half the lacrosse team. They don’t think that’s a great thing. They don’t talk about how great you are. They talk about what a joke you are. So that’s a word to the wise.” Thanking her guests, Kelly closed by saying, “This has nothing to do with the law, but my own unsolicited advice for young women. Don’t sleep around. Don’t be easy. It’s not empowering. It’s embarrassing. You will be the butt of men’s jokes. You will not be respected and you may be humiliated as this woman is now.”

That’s a lot of condemnation.

I looked up Owen’s “thesis” online and found what appeared to be the original power-point on YouTube. Reading it, I did not see the “little girl lost” who was discovered by Flanagan. I just saw someone who was objectively, and at times humorously, evaluating sexual partners from her college years. I was not the only one to see a discrepancy. Looking online for jezebel.com’s interview with Karen Owen, I discovered that a good number of posters, and the reporter who talked with Owen after her list went viral, took Flanagan to task for her many assumptions.

I believe I can identify several different perspectives on this.

The liberal perspective. Flanagan’s theme is clear. Karen Owen was a victim of an alpha-male, athlete-loving, cliquish, misogynist university culture. Her sexual exploits were not her own. Her desires were shaped — nay, deformed — by careless man-boys and a patriarchal system that coddled them. This is not her fault. Duke’s system failed Owen. It “offered her no safe harbor.” Owen deserves our pity. Something must be done, so other girls don’t suffer her fate.

The conservative perspective. Megyn Kelly’s commentary and advice are representative, and painfully traditional. She admits that her advice was unsolicited, yet she was compelled to give it, and keep giving it. It was advice laden with well-wornresentments and prescriptions for proper social and personal behavior for young ladies. It was imparted to viewers as if Mrs. Cunningham were having a serious talk with her daughter on “Happy Days.” Owen is not a good girl. She’s a bad girl. “She’s dirty.” What Owen did was wrong, immoral, disgusting. No self-respecting, young lady does that. It is bad, bad, BAD! SHAME!

Liberals say it’s not her fault. Conservatives say it’s all her fault. Both conclude that Owen is unfortunate. One scolds. One patronizes. Both warn: don’t act this way. It’s bad!

Now, I am no fan of Duke or its athlete-loving culture, but it’s clear from Owen’s own writing that she chose to do certain things with certain people. And she admits enjoying most of her liaisons. There is no accusation of rape or sexual assault, which are criminal acts. There is no blame to be borne here. Though I am a feminist, I do not share Flanagan's sentiments. The Duke University system did not fail Owen. It owed her little beyond an undergraduate education. As for the earnest advice from Ms. Kelly, it is paternalistic, and the shaming aspect is obnoxious. It’s what prompts so many non-Republicans to shout, “Get out of our bedrooms!” And to what purpose did Kelly cite the beauty of her guests? I graduated from college and law school and am now in the dissertation stage of a Ph.D. program. If I tell you what I look like, will that lend any more or less authority to this reflection? Moreover, Kelly’s claim of insight gained by dating the captain of the Syracuse lacrosse team is laughable. Nowhere in her thesis does Owen make any claim that what she was doing was dating. As to Kelly’s traditional invectives against Karen Owen and her exhortations not to sleep around and not be easy, that’s a decision for each individual adult woman to make for herself. Besides, there are two sides to that coin. As Mae West said, “When women go wrong, men go right after them.”

So now, a libertarian perspective. Entering college, Karen Owen was likely 18 years old — old enough to vote, old enough to go to war, and old enough to experiment in various social behaviors. Her thesis does not represent a giant step backward for women, or a giant step forward either. It is simply one individual’s description and humorous assessment of her past activities. It is nothing more, nothing less. As to the other people involved in those activities, they deserve no sympathy because of the publicity she gave them. They, as individuals, each chose to engage in sexual activity with Ms. Owen. If any of them are unhappy that Owen disclosed those activities, every choice has consequences, good or bad. If Owen wants to discuss or analyze these acts, she is free to do so. As are they. While such “postgame analysis” may be in bad taste, there is no law against it, nor should there be. It is simply an additional risk to the already risky act of the college hookup in the internet age.

Though I did not fully appreciate it in my youth, as a mature libertarian I value the advice my father always gave me about social and personal situations: “Be discreet.” He did not mean secretive. He meant that you should think about what you do, and with whom you do it, because all actions have consequences, some quite unwelcome. That’s good advice, solicited or not.




Share This


Rewarding Yale-ness

 | 

I thought I already knew what was wrong with US News’ rankings of “Best Colleges,” so I was slow to reach for Malcolm Gladwell’s recent piece in the New Yorker, The Order of Things” (Feb. 14 and 21). But (to use our past president’s wonderful locution), I misunderestimated Gladwell’s contribution, a portion of which I will share here.

People who follow higher education know that US News’ rankings rely heavily on inputs, not outputs (e.g., not the learning the schools impart but the amount of resources spent), and that they use estimates of reputation for a good part of the ranking (22.5%).

But the problems with US News’ rankings apparently go deeper or at least are more complex. Gladwell argues that it is impossible to come up with a single ranking of heterogeneous institutions (as US colleges are) on multiple dimensions — as US News tries to do — without making “implicit ideological choices.” He says that those choices mean that schools that enable more students to get better educations are always going to be low on the list.

To be specific: universities that currently rank in the middle of US News’ list can’t improve their rankings, for two reasons. A University of Michigan sociologist who studies rankings has found that the university presidents who take the reputation survey (some are expected to “evaluate” more than 200 peer institutions) depend heavily on the existing US News rankings for their evaluations! In other words, the reputation process is circular.

Second, student selectivity swamps measures of effectiveness. Here’s how it happens. US News does have what Gladwell calls an “efficacy” measure, “graduation rate performance.” Since graduation rates depend largely on the selectivity of the incoming students, this measure “compares a school’s actual graduation rate with its predicted graduation rate given the socioeconomic status and the test scores of its incoming freshman class.”

If the graduation rate is higher than expected, the difference raises a school’s score, because the school is graduating more students than would get through on the basis of selectivity alone. (There might be some question about this as a measurement of efficacy, but that’s not my point right now.)

The problem, says Gladwell, is that “no institution can excel at both.” For example, Yale is so high on the selectivity scale (it’s ranked first among national universities) that its “predicted graduation rate” is 96. Thus, its efficacy rate can’t be more than four, and it’s actually two. In contrast, Penn State, which has the lowest ranking of the top 50 national universities, is not as selective as Yale. But it does very well on the graduation measure; its expected graduation rate is 73% and its actual graduation rate is 85%, giving it an “efficacy” score of 12, the highest in the top 50.

But US News gives twice as much weight to selectivity as to efficacy — a completely arbitrary choice and, according to Gladwell, the wrong measure in terms of social benefit (although from the perspective of the student seeking prestige, it may be the right choice).

Finally, the rankings leave out price. Although Gladwell doesn’t recalculate the top 50 universities with price as a factor, he does so with law schools, since an Indiana University law professor has conveniently laid out the chief US News criteria in a spreadsheet. The expected schools are there, led by the University of Chicago, Yale, and Harvard. If Gladwell makes price a factor and gives it equal weight with the US News’ other criteria for law schools, two new schools pop up on the list. The upstarts are Brigham Young University and the University of Colorado.

Gladwell suggests that a school should be rewarded for being affordable, but this is beyond the pale for US News. As a result, says Gladwell, “the Yales of the world will always succeed at the US News rankings because the US News system is designed to reward Yale-ness.”




Share This


Hell No, I Won't Go to Libya

 | 

 

I've declared myself officially neutral in the Libyan civil war.

"Yeah? Well, who asked you, anyway?"

But that's my point. I believe that someone in America should admit his ignorance about which side of the Libyan conflict is good for life, liberty, and the pursuit of happiness. My guess is: neither. It also makes me feel a little strange, just listening to phrases like "a U.S.-provided no-fly zone in Libya." I can't help thinking that there must be a reductio ad absurdum in there someplace.

And speaking of reductios: have you noticed the peculiar behavior of Western correspondents who actually get anywhere near a battlefield in Libya? Every one of them is a huge propagandist for Qaddafi's foes — as, of course, they have a perfect right to be — yet many of their reports from the front sound like this: "Rebel forces are right ahead, hidden behind the ruins of that sentry post, hoping that Qaddafi's air force won't find them there." "Rebel leaders are marshalling their forces ten miles down the road, hoping to hold the city, but without much ability to do so, since they have only two tanks at their disposal." "The latest air strike came 500 feet from the rebel fortification, over on the left, about 50 feet behind that hill. Another strike would wipe them out, if the planes took better aim."

If these are the rebels' friends, I wouldn't want to be the rebels.




Share This


The Tail Slapping the Dog

 | 

I grew up in a blue-collar world listening to jokes and snide remarks about government workers. They were uttered frequently by my father, and the fathers of most of my friends, especially during tax season. I came to perceive that government, at all levels, was riddled with chumps, lackeys, and dullards — people who couldn’t make it in the private sector but found a home in the lackadaisical workplace of government.

It was tacitly assumed that public employees earned less money than their private sector counterparts and that “psychic income” explained their willingness to do so. Psychic income has been defined as “something apart from money that you get from your job, and which gives you emotional satisfaction such as a feeling of being powerful or important.” Anyone who has dealt with government bureaucrats (from IRS agents to building inspectors and DMV clerks) can attest to its allure. My father probably would have described psychic income as a negative salary differential that gave this army of self-important, insecure underachievers a pass. That is, as long as they made less money, their shoddy (good enough for government) work could be tolerated.

That was back in the late 1960s. The Great Society was shifting into high gear. Big government was booming, and the demand for government workers was exploding. In those auspicious days, the job of many public servants was to invent jobs for more public servants. As government revenues continued (1969 to the present) to grow more than 15 times faster than median income, additional public servants were needed just to spend the extra tax money.

During the recession, when nongovernment workers were losing jobs and taking pay cuts, the government was hiring and giving out raises.

But my father’s suspicions about the negative salary differential were partly wrong. Federal civil servants were already making more money than their private sector brethren. And they, as well as state and local public servants, were on track to make much more. I didn’t have the heart to tell my father that the lower salary — the only redeeming characteristic of the shiftless and slothful government workforce — was an illusion. And the grudging tolerance of his generation was being augmented by the unwitting generosity of mine to unleash relentless public sector growth. My generation rewarded public sector workers with unprecedented income — both real (salary and benefits) and psychic (power and importance), sweetening the deal with unprecedentedjob security. The tail began wagging the dog.

Today, the average federal civilian worker earns twice as much in wages and benefits as the average worker in the private sector ($123,049 vs $61,051, annually). The benefits (healthcare, sick days, vacation time, retirement plans, etc.) are profligately generous, as are the taxpayer contributions that pay for them. For example, in 2007, state and local governments paid an average of $3.04 an hour toward each employee's retirement; private employers paid only $0.92/hour. And, in recent years, the pace (of both hiring and wage increases) has accelerated. For example, when the recession started, the Department of Transportation had only one person with a salary of $170,000 or more. That number has now reached 1,690. Defense Department civilian employees earning $150,000 or more increased from 1,868 in December 2007 to 10,100 in June 2009.

We are told (by President Obama and many others) that such obscenely generous compensation is required for attracting the best and the brightest to run government programs. Just think of the mess that Social Security, Medicare, Medicaid, the Postal Service, Amtrak, public housing, education, etc. would be in if managed by less competent professionals. And who could do a better job fighting the wars against poverty, drugs, cancer, AIDS, etc. than the people presently employed? With successes such as these, no wonder they have moved on to protecting us against such menaces as trans fats, sugar, secondhand smoke, bicycles, and toys (the lead-painted ones from China and the obesity-inducing ones from McDonald’s).

And since we must be regulated in both good times and bad, public service is a recession-proof industry. During the recent recession, the federal government added 192,700 jobs (+ 9.8%). State and local governments added a paltry 33,000 (+ 0.2%), but the private sector lost 7.3 million (-6.3%). The average federal government salary increased 6.6%; the average state and local government salary increased 3.9%. To summarize, during the recession, when nongovernment workers were losing jobs and taking pay cuts, the government was hiring and giving out raises.

It has reached a point where even big-government advocates have become appalled. For example, Mort Zuckerman, billionaire businessman and generous contributor to the Obama campaign, has recently discovered that “public workers have become a privileged class — an elite who live better than their private-sector counterparts. Public servants have become the public's masters."

It is of no small significance that the big gainers in the government hiring binge are regulators, lawyers, and public health and safety experts. They are the most annoying of public servants. Operating as social engineers, and under the assumption that without their guidance we (individuals, families, and businesses of all types and sizes) will make bad decisions, they serve two principal purposes: (A) ensuring that we obey every silly law with childlike compliance, and (B) writing more silly laws. This is the tail slapping the dog.

Feckless public servants lavished enormous retirement benefits on themselves, used taxpayer money for payroll contributions, managed to come up $7 trillion short, and now expect taxpayers to foot the bill.

Much of the sting from the slap comes from their colossal ineptitude. They are simply terrible at what they do. The vigilant financial regulators who protected us from the subprime mortgage debacle are a case in point. They include the elite that was running HUD, Fannie Mae, Freddie Mac, and the SEC (whose crack securities experts were downloading porn while credit default swaps and Bernie Madoff ran amok). Their predecessors were equally inadequate in preventing the S&L crisis, the junk bond fiasco, the Enron and WorldCom scandals, and the dotcom bubble.

It should be no great surprise, therefore, that our public masters running government pension funds have reached no higher level of competence. According to a recent report from the Employee Benefit Research Institute, federal pension plans now have unfunded liabilities exceeding $1.6 trillion. Unfunded state and local pension liabilities are estimated at $3.6 trillion. With healthcare benefits added in, state and local government unfunded retirement liabilities could be as large as $5.2 trillion. Consequently, our children face a huge future slap in the form of a tax bill approaching $7 trillion. To summarize: feckless public servants lavished enormous retirement benefits on themselves, used taxpayer money for payroll contributions (at a rate three times that of theprivate sector), managed to come up $7 trillion short, and, instead of going to jail, now expect taxpayers to foot the bill.

Then there is Public Service Recognition Week (PSRW), a nationwide campaign honoring public servants and educating citizens about the sacrifices they make while serving the nation. Federal, state and local public servants spend the first week of every May honoring themselves and bragging about the terrific jobs they are doing. They have exhibits showcasing “the innovative and quality work performed by public employees.” They even have parades “recognizing and thanking their unsung heroes.” This is the tail slapping the dog with disdain.

Public servants have come a long way from the banal, ambitionless, unproductive horde of my father's generation.They are now grossly overpaid, insidiously more powerful, and routinely unaccountable for bad, often abysmal, performance. No doubt most are good people with good intentions, some making legitimate sacrifices. I would go to a parade honoring most policemen, firefighters, teachers, and emergency workers. But there should also be a parade ridiculing those whose malfeasance, indolence, or avarice has failed the public and contaminated the perception of civil service. Regrettably, such a parade could not be held; it would last well over the week allotted.

Today there are simply too many public servants — even good ones. With staggering deficits and staggering public debt, we can no longer afford them. Public resentment deepens the more their compensation is scrutinized, as all levels of government begin trying to cut their budgets. Most are overpaid, especially at the federal level. And today's administrators, regulators, inspectors, social engineers, and the like have painted a disturbing "public masters" portrait of themselves. Furthermore, psychic income as a reward for sacrifice is a thing of the past. As public sector payrolls expand during private sector contraction, it's difficult for taxpayers to see the sacrifice. Public servants have become the "haves," and taxpayers, who pay their salaries, have become the "have-nots." Psychic cost — the economic burden of the government workforce — is a more realistic concept.

From 1787 through the 1920s, federal government spending didn’t exceed 4% of GDP, except in wartime. It has now reached 25% of GDP. Combined federal, state, and local government spending has reached 43% of GDP, and the average taxpayer has to work from January 1 to the middle of each April to pay for this largesse. But even that is not enough. In recent years, federal spending has exceeded tax revenue. It has taken an unprecedented leap since 2008, producing today's massive annual budget deficit of $1.5 trillion. To pay off this deficit, the average taxpayer would have to work until mid-May —and consequently have to miss the Public Service Recognition Week parades.




Share This


The Hollow Revolution

 | 

On the morrow of Governor Scott Walker’s brilliant tactical victory in Wisconsin (stripping the public employee unions of collective bargaining rights while Democratic lawmakers loitered in Illinois), it is perhaps timely to examine the “revolution” of November 2010. In the November elections the Republicans made major gains not only in statehouses across the country, but also in Congress. Sixty House seats changed hands. Eighty-seven freshman Republicans, most of them backed by the Tea Party, entered the House in January with a mandate to bring federal spending under control.

What has resulted from this? Has the Republican sweep produced legislation to reform entitlements, curb defense spending, and eliminate entire chunks of government (the Department of Education, for example)? Make no mistake, nothing less is required if the astronomical budget deficit (almost $1.5 trillion this year) and the crushing national debt (now equal to 100% of GDP) are to be tamed.

Well, the answer is no. After all the electioneering, all the emotion and bloviation about the terrible fiscal crisis America faces, the Republicans produced a plan to cut $100 billion from domestic discretionary spending. That $100 billion represented about 7% of the deficit. And of course the figure was quickly negotiated down to 61 billion, then 32 billion. In any case, domestic discretionary spending is not the problem, or at least represents a minor and noncritical aspect of the problem.

Only real entitlement reform and a willingness to reduce America’s commitments around the world (ergo the defense budget) can cure the fiscal illness that is killing America. And despite the willingness of a few politicians in Washington, DC — Paul Ryan and Rand Paul spring to mind — to enact real reforms, neither of the major parties will ever summon the will to do so. The Democrats will remain in thrall to the teachers’ unions and the trial lawyers and the 43% of Americans who pay no federal tax; the Republicans will continue to craft sweetheart legislation for the corporate donors that fund their party. Neither party dares touch a hot button like agricultural subsidies. And both, apparently, remain convinced that America must bestride the globe militarily, despite the absence of any overweening threat to the American people.

The smaller, statewide revolutions initiated by Walker, Governor Christie of New Jersey, and Governor Kasich in Ohio may offer glimmers of hope. But we shall have to see what the next round of elections brings. If these states fall back into the Democratic column in 2012 and 2014, the work of these governors will be undone. And we shall be back to square one.

In any case, Washington will never change in a fundamental way, even if the Republicans sweep the Senate and the White House in 2012 (don’t hold your breath). We are fated to live in interesting times.




Share This

© Copyright 2013 Liberty Foundation. All rights reserved.



Opinions expressed in Liberty are those of the authors and not necessarily those of the Liberty Foundation.

All letters to the editor are assumed to be for publication unless otherwise indicated.