OMG! The Free Market Works!

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An unintentionally hilarious piece recently appeared in the Pravda of contemporary progressive liberalism, The New York Times.

This lachrymose report laments the fact that major public school districts around the country are losing customers — oops! students — and the result is layoffs. Of teacher union members, no less! Quelle horreur!

Between 2005 and 2010, Broward County (FL), Chicago, Cleveland, Columbus (OH), Detroit, Los Angeles, Philadelphia, San Bernardino, and Tucson have all lost students, some massively.

The article tells some tragic tales. LA let go of 8,500 teachers in the face of an enrollment drop of 56,000 students. Mesa Unified District lost 7,155 students and had to close four middle schools and lay off librarians — the ultimate evil.

The cutbacks are threatening offerings in art, foreign languages, and music.

But to what do the authors of this mournful article attribute this decline? They mention declining birthrates, unemployed parents moving elsewhere to find work, and illegal immigration crackdowns. But they also mention — tentatively and skeptically — the movement of students from regular district schools (essentially run by the teacher unions) to charter schools (run more or less autonomously, i.e., not under the unions’ thumb).

In Columbus, enrollment in charter schools rose by 9,000 students while enrollment in the public school district dropped by 6,150. One honest parent explained, “The classes were too big, the kids were unruly and didn’t pay attention to the teachers.” So she sent her dyslexic daughter to a nearby charter school, where — GASP! — “one of the teachers stayed after school every Friday to help her.”

In an institution where pleasing the customer is actually important, it’s no surprise that her daughter received the help she needed.

Nationwide, while the number of kids in regular public schools dropped by 5%, the number in charter schools rose by 60%.

Naturally, the public school system special interest groups — greedy unions, self-righteous teachers, callous administrators, and so on — are hysterical. For example, one Jeffrey Mirel, an “education historian” at the University of Michigan, bleated that public schools are in danger of becoming “the schools nobody wants.”

Wrong! Public schools have been for some timethe schools that nobody wants. Before the 1960s, teachers unions either didn't exist or — where they did — didn't exert the control they assumed in the 1970s. Teachers unions run schools for the benefit of their members only. So the problems started accelerating.But what’s happening right now is that some few lucky kids are being given the choice to get out — and they’re taking it.




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Batman and Business

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Business is bad in Hollywood, and I'm not talking about the box office receipts. Businesspeople have been portrayed as bad guys in movies for the past several decades. When an audience member asked about this trend during the "Liberty in Film" panel at the Anthem Libertarian Film Festival last month, Hollywood biographer and insider Marc Eliot dismissed it with a wave of his hand. "It's just a shortcut," he explained. "When you see a businessman on the screen, you know it's the villain. It just streamlines the story."

As moderator of the panel, I agreed with him that these shortcuts are probably not intentionally sinister; in fact, the technique goes all the way back to Aesop, who used them in his fables. "If a character was a dog, you knew he would be loyal," I acknowledged. "A fox would be cunning. A crow would steal. In the old days," I went on, "a black hat meant 'bad guy' and a white hat meant 'good guy.' But shortcuts are dangerous and unfair when we're talking about whole groups of people." I specifically referenced the "shortcuts" of earlier generations of filmmakers: blacks were clowns; Indians were ferocious; women were weak. I suggested the danger of having a new generation automatically think "villain" when it sees a businessperson. The problem is that these characters often mirror and perpetuate basic prejudices within a culture. Onscreen stereotypes lead to real-life prejudices.

Panelist Gary Alexander added this biting criticism: "Using shortcuts is just plain lazy." It's true that filmmakers have always used stock characters as shortcuts to storytelling, and they probably always will. But that doesn't mean we have to accept them.

The silver lining to this clouded silver screen is that these shortcuts can be changed. The challenge for filmmakers is to break away from them and create independent characters who can surprise and satisfy. Just as filmmakers of the ’60s, ’70s, and ’80s deliberately challenged black and female stereotypes by casting against type and writing untraditional storylines, so libertarian filmmakers today need to write screenplays that challenge and overturn the stock business villain. These characters need to be portrayed in the rich, three-dimensional diversity that exists in the real world, where some business people are admittedly bad but others are surprisingly (to filmgoers) good.

What a reversal of stereotypical shortcuts! A businesswoman who expresses the proper role of business, and a burglar who reveals her petty jealousies.

This actually happens in The Dark Knight Rises, the latest entry in the Batman franchise. It's subtle, but it's clear: although there are some bad businesspeople in the film, there are just as many good ones, smashing the stereotype and insisting that viewers look past their stock expectations. For example, when Bruce Wayne (Christian Bale) discovers that his homes for at-risk and orphaned boys have not been funded for two years, he confronts his trusted friend and protector, Alfred. "The homes were funded by profits from Wayne Industries," Alfred sadly explains. "There have to be some." That’s a reminder to Bruce, who has been in a deep funk since his girlfriend died, that his neglect of his company has had wide-ranging effects. Bruce — and the audience — are thus informed that "excess profits" are a good thing. They can be used for doing good works, if that is the business owner's goal.

Similarly, in another brief interchange the audience is told that everyone is affected by the stock market, whether they own stocks or not. I don't think I'm giving away too much to tell you that, early in the film, the bad guys break into the stock exchange. The chief of police is unconcerned about the consequences of a financial meltdown, arguing that the average person saves his money under a mattress and doesn't care about what happens to the stock market. The head of the exchange tells him, "If this money disappears, your mattress will be worth a lot less." A simple truth, simply stated.

Later, Bruce Wayne teams up with Miranda Tate (Marion Cotillard), the head of another corporation, and she voices similar truths about the free market. "You have to invest to restore balance to the world," she tells him, acknowledging the importance of capital investment and private enterprise. And when he looks around at a lavish business party she is hosting, she tells him, "The proceeds will go wherever I want, because I paid for the spread myself." Even Ayn Rand would likely approve this self-interested heroine who understands the value of business.

Meanwhile, Catwoman (Anne Hathaway), one of Batman's archenemies, looks around at Bruce Wayne's huge estate and growls jealously, "You're going to wonder how you could live so large and leave so little for the rest of us." What a reversal of stereotypical shortcuts! A businesswoman who expresses the proper role of business, and a burglar who reveals her petty jealousies. Bravo, Christopher Nolan!

Cinematically The Dark Knight Rises delivers all that was promised in the weeks and months building up to its release. Christian Bale's troubled Bruce Wayne lifts the character far above the comic book hero created by Bob Kane and trivialized by the Adam West TV series in the ’60s. Gone, too, is the sardonic humor injected by George Clooney's portrayal in the ’80s. This Batman is a reluctant savior of a world that has largely misunderstood and rejected him. While he has a few ardent supporters, most consider him a traitor and want him destroyed. He is briefly tempted away from his mission by the love of a woman. He suffers indescribable agony in a dark prison at the hands of a monstrous villain named Bane (Tom Hardy) — the "bane" who wants to destroy the world. Despite his reluctance, Bruce accepts his arduous task. In short, he is a classic Christ figure, adding gravitas to the modern myth of Batman. He even says at one point, "My father's work is done."

I had to display the contents of my purse to a uniformed employee before entering the theater. I hope that a TSA-style Movie Safety Authority does not take over our malls and movie theaters.

But while the characters are rich and well acted, the story is interesting, Hans Zimmer's musical score is powerfully compelling, and the final hour is particularly thrilling, it was difficult to watch this film. Action movies have always provided an opportunity to enter another world, suspend one's disbelief, enjoy vicarious experience, then step back into the real world where "things like that" don't really happen. But in light of what did happen in Aurora, Colorado on opening night, I found it almost impossible to separate myself from the barrage of onscreen shooting in the first half hour of the film. It seemed devastatingly real because I knew it was during this scene of heartless shooting in a very public location that the actual shooting began. I was almost ashamed to be there, seeking a few hours' entertainment from a film that was the unwitting stage for such terror.

I also found myself looking around the aisles and corners of the theater, watching for suspicious characters and devising an escape plan. This was partly because I had to display the contents of my purse to a uniformed employee before entering the theater. I hope that fears like this dissipate for everyone. And I hope that a TSA-style MSA (Movie Safety Authority) does not take over our malls and movie theaters.

Spoiler alert — read the next paragraph only if you have already seen this movie, or if you have no intention of ever seeing it:

The film ends with an "aha" moment that is so thrillingly unexpected that, when I saw it, the entire audience gasped in disbelief. But I should have known from the beginning. Marc Eliot explained it to us in the “Liberty in Film” panel, and he was right: Hollywood uses shortcuts to tell us who the bad guy is. Even when a writer-director is planning the most delicious of twists for the end, he is helpless against his own Hollywood instincts. Nolan telegraphed it from the start: In modern movies, the business owner is always the bad guy. Even when you least expect it.


Editor's Note: Review of "The Dark Knight Rises," directed by Christopher Nolan. Warner Brothers, 2012, 164 minutes.



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Defending Capitalism against Ayn Rand

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The titles that Ayn Rand assigned to the three parts of Atlas Shrugged proclaim her insistence that logical contradictions cannot exist in reality. By contrast, the title of the magnum opus of the ultimate charlatan in Atlas Shrugged, Simon Pritchett, is The Metaphysical Contradictions of the Universe. Francisco d’Anconia and Hugh Akston explain to Dagny Taggart that whenever someone thinks he has encountered a contradiction, he must check his premises, and he will find that one of them is wrong (I.9, 7, 10).1

In this essay, I will follow d’Anconia’s and Akston’s advice. I will show that a fundamental contradiction pervades Atlas Shrugged because Rand failed to check her premises. She thought that the heroes she created were exemplars of pure, uncorrupted capitalism. In fact, the heroes she created in Atlas Shrugged came from her sense of life, which was not only un-capitalist but anti-capitalist. I will also show that this contradiction is extremely fortunate because it illuminates why capitalism is the most efficient and humane economic system ever implemented.

Rand often emphasized the importance of a person’s “sense of life” and of art as its expression (e.g., Rand 1975: 31, 33, 44). She defined her sense of life and its artistic expression most clearly in an essay she wrote on Victor Hugo (1975: 153–61). In it she said, “Victor Hugo is the greatest novelist in world literature” because his characters are “a race of giants,” who are not concerned with “penny ante.” “‘Grandeur’ is the one word that names the leitmotif . . . of all of Hugo’s novels — and of his sense of life.”

The heroes Rand created in Atlas Shrugged came from her sense of life, which was not only un-capitalist but anti-capitalist.

In Atlas Shrugged, Rand created heroes who embodied her sense of life and described how such heroes would fulfill their heroic natures if they engaged in economic activities. She thought that the sum of their economic activities and interactions provides a template of what laissez-faire capitalism would be like. She was wrong. When the heroes who embody her sense of life engage in economic activities, they function like Communist administrators, not capitalist businessmen.2

To paraphrase Rand, “Grandeur is the one word that names” the sense of life of Communist economies. They had no concern with anything “penny ante.” In the 1980s, when the economy of the Soviet Union was disintegrating, it was producing between 1.5 and two times more steel and cement than the United States and generating more electricity; it also had 2.5 times more machine tools. However, buttons, clothespins, babies’ pacifiers, and thermometers were always extremely difficult to find in the Soviet Union (Shmelev and Popov 1989: 82, 132, 144). Toilet paper and toilet seats were such rare and precious commodities that when McDonald’s opened a restaurant in Moscow, in 1990, its employees had to guard its restrooms to prevent customers stealing toilet paper and toilet seats (Goldman 1991: 166). The Soviet Union’s heroic economy also did not provide contraceptives or a single practical guide to contraception. As a result, Soviet women averaged at least four legal abortions during their lives; and the average was higher in the non-Muslim regions of the Soviet Union. In addition, large numbers of illegal abortions were performed. Anesthetics could be obtained only by a large bribe (Feshbach and Friendly 1992: 208–9).

In Rand’s novel The Fountainhead, the villain, Ellsworth Toohey, completely destroys Catherine Halsey’s soul, and the visible sign of her corruption is that her mouth has adapted to giving orders, “not big orders or cruel orders; just mean little ones — about plumbing and disinfectants” (IV.10). Toohey has turned her into the opposite of a Communist. The Communists gave big, cruel orders and had no concern with mean little considerations. The heroes of Atlas Shrugged are heroic because, like Communist bureaucrats, they produce or maintain impressive products, not mean little ones. It would be unimaginable for a Rand hero to be a manufacturer of “penny ante” products, such as disposable baby diapers, menstrual tampons, or dependable contraceptives. But these distinctively 20th-century inventions improved the quality of life immeasurably by freeing people from preoccupation with brute, animal existence.

Most services would be included among “mean little” occupations. The Communists’ heroic obsession with production caused them to ignore services, which, with a few exceptions, they did not even include in their gross domestic product statistics. In fact, Marxists always used the term “the means of production” as a synonym for “the economy.” In modern capitalist countries, most businesspeople provide services. With one exception that I will discuss below, the only service that a hero in Atlas Shrugged provides is running railroads. This is clearly not a “mean little” occupation, and it was one of the few services that the Soviet Union included in its gross domestic product statistics (weight of freight times kilometers carried).

Moreover, Rand ignored all services in her representation of history (1963: 10–57) as a battle between Attila and the Witch Doctor and their antithesis, the Producer. Indeed, her practice of using “industrialist” as a synonym for businessperson excludes businesspeople who produce “penny ante” products, along with those who provide services. In his long speech in Atlas Shrugged, John Galt (i.e., Ayn Rand) says, “Productiveness is your acceptance of morality . . . productive work is the process by which man’s consciousness controls his existence, a constant process of . . .  shaping matter to fit one’s purpose, of translating an idea into physical form, of remaking the earth in the image of one’s values;” and, “the industrialists, the conquerors of matter” “have produced all the wonders of humanity’s brief summer” (III.7).

It would be unimaginable for a Rand hero to be a manufacturer of disposable diapers, tampons, or dependable contraceptives.

It is true that the great philosopher Hugh Akston owns a diner and cooks its food, which he does with extraordinary skill, making “the best-cooked food she [Dagny] had ever tasted” (I.10). However, Rand does not let this fact affect her conceptualization of productive work when Galt tells Dagny, “We take nothing but the lowliest jobs and we produce by the effort of our muscles” (III.1).3

In her short story “The Simplest Thing in the World” (1975: 173-85), Rand depicts a writer of fiction who cannot make a living because he has the same sense of life as Rand. The writer decides he has to create the type of story that will sell: “a simple, human story,” which consists of “lousy bromides.” “It mustn’t have any meaning,” and its characters must be petty because “[s]mall people are safe.” However, he is incapable of writing such a story. Every time he tries, his sense of life thwarts his conscious efforts, and he starts composing a story about heroes. The reason, as Rand explains in her introduction, is that his “sense of life directs . . . and controls his creative imagination.” To exemplify this fact, he begins to write “a story about a middle-aged millionaire who tries to seduce a poor young working girl.” He is “a big tycoon who owns a whole slew of five-and tens [i.e., discount stores].” But the author cannot write this story. As he develops the story in his mind, his sense of life makes him forget about the girl and transform the villain into a hero. As part of the transformation, he says to himself, “to hell with the five-and-ten!” The hero now builds ships because he is driven by “a great devotion to a goal.” He is motivated by “a great driving energy . . . the principle of creation itself. It’s what makes everything in the world. Dams and skyscrapers and transatlantic cables.” “[H]e wants to work — not to make money, just to work, just to fight” (emphasis added). So, an author with Ayn Rand’s sense of life could not make the hero of his works a retailer, no matter how successful he might be; not even Sam Walton, who founded Walmart and built it into the company with the greatest revenue of any company in the world.

Because the Soviets had the same sense of life as the author in this short story (i.e., the same as Rand), they were extremely proud of the enormous hydroelectric dams they built, and their retailing was horribly inefficient. In the Soviet Union, people had to wait in long lines for any purchase. If someone had time to spare, he would wait in a line to buy something he did not need, in order to barter it with someone who had waited in another line to buy something else. When McDonald’s opened its first restaurant in Moscow, it set all records for number of customers: 40,000 to 50,000 a day, even though its food cost twice as much as the food in state-run cafeterias. It had twenty-seven cash registers. In Communist countries, the length of a line of customers showed how valuable the merchandise was at the end of that line. So, McDonald’s had to have ushers to tell customers not to go to the longest line (Goldman 1991: 166–7; Blackman 1990).

The opening of this first McDonald’s — an event that, as much as any other, marked the end of Communism — illustrates another serious defect in Communist-Objectivist ideals. A small notice in a Soviet newspaper drew 27,000 applicants for jobs as counter clerks, even though the anticipated salary was only average by Soviet standards. Those who were chosen had to be trained to smile at customers and speak politely to them. Their training was so successful that customers could not believe that the clerks were Soviet-raised Russians (Blackman 1990; Goldman 1991: 166–7).

An author with Ayn Rand’s sense of life could not make the hero of his works a retailer, no matter how successful he might be.

Rand used “grocery clerk” to symbolize the antithesis of her ideal (1964: viii; 1975: 84). In her first novel, We the Living, when the heroine, Kira, sees her future lover Leo for the first time,she observes that “[h]is mouth . . . was that of an ancient chieftain who could order men to die, and his eyes were such as could watch it.” However, Leo says to Kira, with bitter humor, “I’m nothing like what you think I am. I’ve always wanted to be a Soviet clerk who sells soap and smiles at customers” (I.4). Again, Rand reversed Communism and capitalism. Men who could order others to die and watch their death calmly characterized Communism. Smiling clerks, who sell unimpressive products, characterize capitalism.

When Nathaniel Branden was the official Objectivist expert on psychology, he wrote, “[P]roductive work is the process through which a man achieves that sense of control over his life which is the precondition of his being able fully to enjoy the other values possible to him … [P]roductive . . . achievements lead to pride” (“Self-Esteem: Part IV,”The Objectivist, June 1967). Branden, as he himself later realized, was exaggerating. But he was exaggerating a truth. A feeling of control over one’s life and pride in productive achievements are certainly wonderful feelings. They can derive directly from the type of work done by Communist administrators and the heroes of Rand’s novels, especially if, like Howard Roark, they have an uncapitalist indifference to money and accept only those projects that appeal to them. However, a feeling of control over one’s life and pride in achievements do not follow directly from the type of work that most people in a capitalist society do: salesmen, accountants, insurance brokers, bank clerks, and manufacturers of “penny ante” products, like clothespins and underpants.

Nearly all readers of Rand’s novels, even those who disagree with her philosophy, recognize that she was a brilliant novelist. But not even her brilliance as a novelist could have made a gripping, inspirational novel about the work that is done in distinctively capitalist occupations, occupations that do not exist in Communist countries, such as advertising or being a real estate agent. In fact, the first jobs of the odious Wesley Mouch were in advertising (Atlas II.6).

Let us consider briefly the novelist whom Rand (1975: 119) regarded as the best of the naturalists, Sinclair Lewis. When Lewis wanted to write novels about admirable protagonists, he made them a dedicated research scientist (Martin Arrowsmith) and the president of a car company (Sam Dodsworth), who began his career as assistant manager of production. When Lewis wanted a pathetic protagonist, he made him a real estate agent (George Babbitt). Babbitt, like Dodsworth, is successful at his work. But Lewis says in the first chapter that Babbitt “made nothing in particular, neither butter nor shoes nor poetry;” and he “detested the grind of the real estate business, and disliked his family, and disliked himself for disliking them.”

The discussion so far illuminates a crucial benefit of the love of money. It entices people into occupations that they may not find interesting or inspiring, but are socially necessary; and it exerts constant pressure on business owners to provide what the public wants, not what they enjoy doing.

In all of Rand’s novels, only one business owner completely embodies the capitalist ethos. That is the press tycoon Gail Wynand, in The Fountainhead, who becomes fabulously rich through selfless service to the public, by providing it with what it wants: a lowbrow, sentimental, lurid newspaper. As he says (IV.11), he has led a life of “[s]elflessness in the absolute sense.” He “erased [his] ego out of existence” by following the principle, “Give the greatest pleasure to the greatest number.” However, according to Rand, Wynand is guilty of the most horrible sin in her moral universe: betraying himself.

Men who could order others to die and watch their death calmly characterized Communism. Smiling clerks, who sell unimpressive products, characterize capitalism.

Wynand’s opposite is Nathaniel Taggart, in Atlas Shrugged, who is supposed to be the archetypal capitalist. As Dagny recalls (I.8), “He said that he envied only one of his competitors, the one who said, ‘The public be damned!’” Nothing could be more antithetical to the motivation of a successful business owner in a capitalist society. This is the ethos of the head of a production unit in a Communist economy, who derives exhilaration and pride from productive achievement without regard to providing the public with what it wants.

Rand’s story “The Simplest Thing in the World” is an excellent illustration of this point. It assumes that an author with Rand’s sense of life is compelled to create a protagonist who does not work for money and therefore chooses to build ships instead of discount stores. This contrast is factually accurate. Someone motivated by money would not consider shipbuilding as a business career since, in economically advanced countries, shipbuilders can stay in business only by means of tariff protection or government subsidies or both. But he would certainly consider the business of discount stores, since they have proved to be the most profitable (i.e., socially useful) branch of retailing.

The economic role of money in constantly driving economic participants to provide the public with what it wants is related to an admirable moral attribute of the free market. It is completely democratic and non-coercive; no one can interfere with other people spending their money on what they want. In her essay “What Is Capitalism?” (1967: 17, 20) Rand showed that she was fully aware of this fundamental attribute of capitalism (the italics are Rand’s):

[T]he works of Victor Hugo are objectively of immeasurably greater value than true-confession magazines. But if a given man’s intellectual potential can barely manage to enjoy true confessions, there is no reason why his meager earnings, the product of his effort, should be spent on books he cannot read.

The tribal mentalities attack this principle . . . by a question such as: “Why should Elvis Presley make more money than Einstein?” The answer is: Because men work in order to support and enjoy their own lives — and if many men find value in Elvis Presley, they are entitled to spend their money on their own pleasure.

It is the Gail Wynands who provide true-confessions magazines and Elvis Presley CDs.

At this point, many readers will object that Ayn Rand appreciated the value of money. She ended Atlas Shrugged with its hero tracing the sign of the dollar in space, made a gold dollar sign Atlantis’ “coat of arms, its trademark, its beacon” (III.1), and herself often wore a gold dollar sign pinned to her dress.

Yet in The Fountainhead, Toohey asks Peter Keating about Roark (II. 4), “Does he like money;” and Keating replies No. But long before that, the reader has learned that Roark’s abnormal indifference to money is one of the essential characteristics that make him the hero of this novel. Indeed, in “The Simplest Thing in the World,” Rand assumed that an author with her sense of life must write only about heroes who do not care about money.

Rand assumed that an author with her sense of life must write only about heroes who do not care about money.

In Atlas Shrugged, Rand sometimes has her heroes claim that their goal is to make money. At the opening of the John Galt Line, which is by far the greatest achievement of both Dagny and Hank Rearden (I.8), a reporter asks Dagny her “motive in building that Line.” She answers, “the profit which I expect to make.” Another reporter cautions her, “That’s the wrong thing to say.” But she repeats it. Yet before her trip begins, she looks at the crowd that has gathered and notices that they are there, not because these people expect to make a profit, but “because the sight of an achievement was the greatest gift a human being could offer to others.” The description of the ride on the John Galt Line is the most exhilarating fiction writing I can recall reading; and I have read a great deal of narrative fiction, in ancient Greek, Latin, English, and French. For Dagny, “It was the greatest sensation of existence; not to trust, but to know.” “She felt the sweep of an emotion which she could not contain, as of something bursting upward.” And what about the engine drivers? Every one of them who was available volunteered to drive the train despite persistent warnings of danger. Surely, they were not motivated by money.

At least in their economic interactions, money should be the primary consideration of the heroes of a novel that ends with the dollar sign traced in the air. In Part I, Chapter 1, Dagny’s parasitical brother James says to her, “I don’t like Hank Rearden.” Dagny replies, “I do. But what does that matter, one way or another? We need rails and he is the only one who can give them to us.” James Taggart, typically of him, replies, “You have no sense of the human element at all.” This conversation crystallizes capitalist and uncapitalist mentalities.

Nevertheless, the economic decisions of the heroes of Atlas Shrugged are constantly motivated by the human element. That is true even of the one major character in Atlas Shrugged who is a pure capitalist, Midas Mulligan. He says he joined the strike because of a vision, in which he “saw the bright face and the eyes of young Rearden . . . lying at the foot of an altar . . . and what stood on that altar was Lee Hunsacker, with the mucus-filled eyes” (III.1). In Part II, Chapter 3, Francisco asks Rearden: did you want the rail you made for the John Galt Line used by your equals, like Ellis Wyatt, and by men such as Eddie Willers, who do not match your ability but who “equal your moral integrity” and “riding on your rail — give a moment’s silent thanks”? Rearden answers Yes. Francisco then asks, “Did you want to see it used by whining rotters?” Rearden answers, “I’d blast that rail first.” Francisco then explains that by "whining rotter" he means “any man who proclaims his right to a single penny of another man’s effort.” But no economy, whether socialist or capitalist, could function for one day if producers acted in this way. In Part II, Chapter 10, Dagny says that Nathaniel Taggart, supposedly the archetypical capitalist, “couldn’t have worked with people like these passengers. He couldn’t have run trains for them.” But no one running a train line, even in a socialist economy, could possibly consider the moral worth of its passengers, or any consideration besides their paying for the ride.

No one running a train line, even in a socialist economy, could possibly consider the moral worth of its passengers, or any consideration besides their paying for the ride.

I will conclude with the most frequently quoted explanation of why the market is the most effective means of providing people with what they want. It is by Adam Smith, in Book I, Chapter II of The Wealth of Nations: “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard for their own interest. We address ourselves . . . to their self-love.” Butchers, brewers, and bakers had a very low priority in Communist countries. When McDonald’s opened its first restaurant in Moscow, it had to train its own butchers (Goldman 1991: 166). It is also unimaginable for an Ayn Rand hero to be a butcher, brewer, or baker. The self-interest and self-love that induces people to become butchers, brewers, and bakers and to perform those jobs well is totally different from the heroic self-love of Rand’s heroes. It is an unheroic desire to support themselves and their families in comfort and security.

In her essay “What Is Capitalism?” Ayn Rand showed that she understood as well as Smith why love of money is wonderfully socially beneficial. In her fiction, however, her anti-capitalist sense of life obliterated that knowledge.

***

Footnotes
1. I cite passages in Rand’s novels by the part of the novel in which they occur and the chapter in that part. I do not cite page numbers because there are many editions, and each has different pagination from the others.
2. I write “Communist” with a capital “C” to indicate a member of a Marxist-Leninist Communist Party. Many people have championed a communist society (with a small “c”), beginning with the first two extant projections of an ideal society: Plato’s Republic and Aristophanes’ Ecclesiazusae, both from the 4th century BC.
3. Several of the heroes provide services while they are in Galt’s Gulch. But these jobs are merely stopgaps until they return to the world and use their talents again in their real work.

Bibliography
Blackman, Ann 1990: “Moscow’s Big Mak Attack.” Time (February 5).
Feshbach, Murray and Friendly, Alfred Jr. 1992: Ecocide in the USSR: Health and Nature under Siege. London: Aurum Press.
Goldman, Marshall 1991: What Went Wrong with Perestroika. New York: W.W. Norton & Company.
Rand, Ayn 1963: For the New Intellectual. New York: Signet.
Rand, Ayn 1964: The Virtue of Selfishness. New York: Signet.
Rand, Ayn 1967: Capitalism: The Unknown Ideal. New York: Signet.
Rand, Ayn 1975: The Romantic Manifesto, revised edition. New York: Signet.
Shmelev, Nikolai and Popov, Vladimir 1989: The Turning Point: Revitalizing the Soviet Economy, translated by Michele A. Berdy. New York: Doubleday.


Editor's Note: This article is part of a much longer monograph with the same title. It can be obtained from the author at stevenfarron@gmail.com.



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Populist Fizzle

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The Obama campaign and the DNC appear increasingly desperate in their attempts to find some attack on Romney that resonates with the American people. They’re desperate, of course, because the economy continues to drift in the doldrums, and the election looms.

The latest is a populist ploy. Key Democratic politicians started attacking Romney for having invested in foreign companies and having assets in Swiss and other offshore accounts. This was immediately trumpeted by the mainstream media. How dare Romney invest abroad! He’s the pioneer of offshoring!

Now, it is by no means illegal — yet — to put some of your portfolio into foreign assets, and it is in all the “Investing 101” books that you ought to do so. You need to diversify your assets to minimize risks, and this may include diversifying outside your home country. Putting money in a Swiss account, for example, is a good hedge against inflation, given the historic stability of the Swiss monetary system. But the Dems are banking on the fact that the average person doesn’t understand all this — and that is a very good bet.

Alas, however, the attack fizzled when it was discovered that Rep. Debbie Wasserman Schultz (D-FL), chair of the DNC, had herself invested abroad, repeatedly. She invested in the Davis Financial Fund, with holdings on the State Bank of India, as well as a Swiss private banking group. She also invested in the Fidelity Advisor Overseas Fund, which has holdings in HSBC (a British bank), Novo Nordisk (a Danish drug company),VW, Rakuten (a Japanese shipping firm) and so on.

It also turns out that another person who has invested abroad is the ever-offensive Rep. Nancy Pelosi (D-Venus), “head” (though not the brains) of the House Democrats. She earned millions from her investment in Matthews International Capital Management, which focuses primarily on Asian equities.

Obama, like his spiritual mentor Nixon, is much given to what psychologists call “projection” — calling others what you yourself are. Obama once accused McCain’s campaign of “throwing stuff up against the refrigerator to see what sticks.” Yes, President Obama, and you don't have an infamous "enemies list."

But it looks like this little piece of magnetized crap isn’t sticking. Try again, guys.




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The Paradoxical Comfort of Bureaucracy

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Back in the days when your grandfather was still looking at your grandmother with inquisitive lust, I spent about 18 months on an aircraft carrier. I was a draftee in the French Navy, untrained for anything and possibly the lowest man on the totem-pole. I was 21 when I got out. In good time, I attended the university and graduate school in the US and I became a scholar in organizational theory (a pretty good one if I say so myself).

But my brief military experience remains vivid in my memory. In part, that's because everything you do at 20 tends to live in the brain in Technicolor and in Panavision. In part it's alive in my mind because interesting things happened there. When I write now about my naval period, I feel almost forced to apply a bit of organizational analysis to my memories. It's a slightly disturbing experience because being a small cog in a bureaucratic organization, a state organization at that, unexpectedly fails to evoke bad feelings.

It's disturbing because life and work within a bureaucracy is at the antipodes of libertarian utopian imagery. It's disturbing, additionally, because government routinely acts as the principal agent of routine state oppression in societies with a constitutional government such as the US. This malaise is also an opportunity. I believe that people who think of themselves as libertarians, even those with a mere libertarian bent, don't spend enough time thinking about disconfirming evidence, about experiences that run counter to their main existential choices. Here is a brief analysis, one that may speak a little to the issue of why some people are attached to bureaucracies in spite of their libertarian leanings.

In the navy, for days and weeks on end, I lived in an environment made entirely of steel except for the small patch of linoleum I cleaned every morning and the occasional spare piece of rubber connection. To be completely accurate, I have to specify that there were also plastic curtains around the bunks and part-cotton sheets inside. And the metal surroundings were all not especially unpleasant. Perhaps, if you are going to venture on the treacherous ocean, it's good to do it in a vessel made of thick sheets of steel joined together by large and visible steel nuts and bolts.

I felt the same about the organizational environment as I did about the physical environment of the ship. In general, I felt safe on the aircraft carrier. There were several reasons, some of which it costs me to remember because doing so constitutes a confession of sorts.

First, there were well-thought-out and well-rehearsed routines for everything, at least for everything that I knew then and, to a large extent, even for what I now know. (I never experienced naval combat, but I think the same principle prevailed there.) You could believe that whatever happened, the people doing something about the whatever would not be improvising a response. You could also be confident that their response would be familiar — familiar to them, that is, however alien it seemed to you.

Perhaps, if you are going to venture on the treacherous ocean, it's good to do it in a vessel made of thick sheets of steel.

Even my living-quarters close neighbors, the bosun's mates who were operating under the influence of alcohol most of the time, projected an air of competence. Bringing two small boats smoothly side by side in a choppy sea did not seem to tax the young guys who I would have bet could probably not negotiate the gangway to get themselves ashore for a fresh drink.

The second behavioral factor contributing to this feeling of safety was chronic overstaffing. I think that personnel redundancy is a general organizational principle in navies, military organizations, as opposed to merchant fleets, for example. The aircraft carrier is a special case because of its multiple functions. So I will focus on the case of a small destroyer that is similar in size to many cargo-ships of the pre-container period. My considered, serious guess is that the crew of a destroyer was at least three times larger than the crew of a freighter of similar tonnage. Or, to put it another way, the captain of a small freighter of the day could easily have boasted: “I can run this destroyer with my eighteen men. Just put ashore its current excessive crew of sixty. We will do the job, no problem. Perhaps, leave one gunner behind; no big deal.”

Overstaffing is a luxury that ensures that few if any organizational members will be stressed by overwork, except perhaps at the very top. There were telling details supporting this perspective, details that would have bespoken laziness in any framework other than a military one. Thus, when the officer on watch on the bridge made an announcement over the ship's public address system, he did not conclude his address with a greeting or introduce himself or give a summary, nor did he hang the mike himself. He had an enlisted gopher standing by to make these small gestures for him.

Another way to speak of overstaffing is to refer to underwork. My boss was the Chief of Operations, the third ranker on board. He had one full yeoman, a guy who had signed up voluntarily and who had been more or less trained by the navy. I, a draftee, had received no training beyond boot camp. My boss agreed early in our acquaintance that his assistant-yeoman, myself, was to deliver each day a given, limited amount of work. The amount was one single typed stencil. That would have been the amount of typing a careful, well-trained professional typist (working on terra firma) could easily have supplied in one hour. The key to understanding the apparent waste is this: At any one time, my boss the Operations Chief knew that he could put seaman Delacroix to work to do the urgent or the unexpected — hand-carry a message, sharpen his pencils, or pick up his laundry in a raging storm — without sacrificing any other aspect of his, the Chief's, responsibilities. So the abundance of underutilized work capacity was a source of comfort for all aboard ship; it implied that those with serious responsibilities were unlikely to be overwhelmed by them.

The principle of overstaffing, or of an underutilized work force, ran throughout and up and down the complex organizational chart of the aircraft carrier. There were three apparent exceptions. First, some menial functions might be understaffed for a short time. Second, one crucial but rarely performed task apparently failed to command sufficient personnel. Third, the most industry-like subpart of the ship's organization seemed to be perennially short of qualified bodies.

First, the menials. It might happen occasionally and for a brief period that some small functional department was short one man. That would always be in areas of activity where overworking the remaining men, by giving each the equivalent of half a civilian work load, for example, would not seriously endanger other operations. I am literally referring to peeling potatoes and to cutting hair while at sea. It was common practice among petty-officers to bribe the crewmen thus rudely put upon, with a couple of bottles of beer. (Yes, there was and there is alcohol on French naval ships. Their crews may not shoot straight but they are not stressed!)

A second exception to the rule of underutilization of personnel still puzzles me a little. There was only one old senior petty-officer on board who was able to steer the huge ship through certain narrow harbor entrances in very stormy seas. This scarcity perplexes me because the task was in no way comparable in its importance to peeling potatoes, for instance. The preservation of extremely expensive matériel and possibly the safeguarding of many lives demanded that this skill be available.

Yes, there was and there is alcohol on French naval ships. Their crews may not shoot straight but they are not stressed!

I have no solid explanation for this queer penury. Here is my best guess though: most of the functions to be performed on the ship could be reduced to small gestures that could in turn be described concretely and thereby routinized. Most of those functions could be reduced to routines that were easy to learn even for the moderately gifted. Producing in advance of need a ready supply of people to perform those functions was not a big deal. Those common functions demanded only carefulness for successful performance. By contrast, the ability to drive a gigantic floating object battered by winds and contradictory wave conditions through a narrow passage depended on tacit knowledge.

Tacit knowledge is knowledge that is difficult to transfer deliberately. It's what can be learned but cannot be taught, or only taught to a limited extent. Tacit knowledge is found also in art, in dress-designing, in bread-baking and of, course, in the brewing of beer. I mean with respect to the latter that it's easy to brew beer and fiendishly difficult to brew good beer. Because much of tacit knowledge cannot be taught, precisely, it may often be in short supply. Alternatively, it may occur naturally more commonly than is objectively necessary (as with artists, for example). Such oversupply does not receive much notice, naturally. Only shortages are noticeable.

The third exception to the principle of overstaffing keeps sticking in my mind because it does not make obvious sense in spite of my best efforts.The flight deck crewmen often complained of overwork. Their jobs were both essential (obviously, we were on an aircraft carrier) and as minutely divided and routinized as anything, anywhere on earth. So, if the principle of overstaffing did not apply to them, it was not because their work relied on tacit knowledge that was hard to find. Neither were they expendable like the potato jockeys I evoked earlier. I just don't know for sure why they said they were overworked. This want of an explanation mars my nice analysis, but I must almost leave it at that. I say “almost,” because I sometimes had the thought that being overworked — or proclaiming oneself overworked — was cool for flight deck personnel but not for other crewmen.

They, the flight deck crewmen, had to work day in and day out with pilots whose own exalted status was likely to create different emotions around them. Come to think of it, I had an intuition about that cultural proximity factor right then. I spent much time observing landing and takeoff maneuvers on the flight deck from a safe spot. And I was well aware of aviation crewmen’s complaints about overwork. Nevertheless, their complaints never troubled my own sense of comfort, although my tiny office, with me inside, bent over my typewriter, could have easily been wiped out by a single misdirected landing.

I hope the reader understands that the few preceding paragraphs constitute a kind of regrettable but real declaration of faith in well-designed bureaucracy. Of course no one asked that particular bureaucracy to be efficient. It was expected only to be effective, to get the job done, almost irrespective of cost.


Editor's Note: This essay is adapted from Delacroix's as-yet-unpublished memoir, “I Used to Be French: An Immature Autobiography.”



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Negative Externalities

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The New Shape of Immigration

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There has been a veritable blizzard of major news stories lately. Between the continuing crisis of the European Union, the spate of major rulings from the Supreme Court, and the continuing presidential election campaign, we’re all a bit overwhelmed.

But a recent report from the Pew Research Center bears immigration news worth noting and commenting upon.

The report, aptly called “The Rise of Asian Americans,” is a hefty tome indeed, at 215 pages chock full of data. It reveals that for the first time in history, the plurality of all new American immigrants now hails from Asia — primarily China (23.2% of all Asian Americans), India (18.4%), Japan (7.5%), Korea (9.9%), the Philippines (19.7%), and Vietnam (10.0%).

As recently as 2007, the plurality of immigrants was Hispanic, primarily from Mexico. That year, 540,000 immigrants were Hispanic, compared to 390,000 Asians. But in 2010, Asians were 36% of new immigrants, while Hispanics dropped to 31%.

This culminates the decade-long, precipitous slide in Hispanic immigration, which was at 1.2 million in 2000, fell to about half that in 2002, went up to about 800,000 in 2005, and has dropped steadily since, to less than 400,000 in 2010.

By contrast, the number of Asian Americans quadrupled between 1980 and 2010, and now stands at 18.2 million, counting native- and foreign-born, adults and children. (The Pew Center’s count is slightly higher than the Census Bureau’s, with the difference being that Pew counts people with only one Asian parent as Asian. That is nearly 6% of the population, quite a rise from the 1% it was back in 1965. (By comparison, non-Hispanic whites are 63.3%, Hispanics are 16.7% and blacks 12.3%). The report projects that by mid-century, the number of Asian Americans will hit 41 million.

Of course, this is just a projection by the Pew Center, which is certainly reputable, but obviously fallible. Still, these figures are suggestive.

The reasons for this shift are varied. There are relevant demographic shifts abroad, such as the drop in the birth rate in Mexico, which as recently as the 1960s was one of the highest on the planet, with the average woman having nearly seven children — higher even than Indian and Chinese women — but now is roughly the same as the US rate (a little over two children per average woman).

But the report mentions what is clearly the major factor: our nation’s continuing shift from a manufacturing to an epistemic or knowledge-based economy. Blue-collar jobs, especially the low-skilled ones, simply have been increasingly less in demand over the past quarter-century. And a prolonged recession and slow recovery such as the one we are enduring only increases the gap in employment levels between blue- and white-collar workers.

So the disappearance of a lot of blue-collar jobs, especially in construction, has meant that more opportunities have opened for Asian immigrants, who tend to have higher educational attainment than recent Hispanic immigrants.

Add to this another factor: we have tightened the southern border, which means that Asians, who tend to get more student and high-tech (H1-B) work visas, are now in a better position to come here.

A major factor in their success is the fact that Asian Americans have a lower rate of single-parent households than does the population as a whole (20% versus 37%). They are more likely to be married than is average for Americans (59% versus 51%), and have fewer births to single mothers (16% versus 41%).

However, of paramount importance is the level of higher education. Nearly half (49%) of all Asian American workers have a bachelor’s degree, which is more than half again as many as the average — 28% — for all American workers. For non-Hispanic whites, it is 31%, for blacks 18%, and for Hispanics 13%.

Asian students — both American-born and foreign — tend disproportionately to choose more technical college majors, which is no doubt another factor in their success. In 2010, they received 45% of all engineering doctorates awarded at American universities, 38% of all computer and math doctorates, 33% of all physical sciences doctorates, 25% of all life sciences doctorates, and 19% of all social science doctorates.

Since Asians are culturally very inclined to pursue higher education, and since the US has an extensive but still relatively inexpensive source of higher education, and again since our economy is increasingly knowledge-based, it is no surprise that as a group Asian-Americans are moving sharply upward economically.

That rise has been as dramatic as it has been rapid. Asian Americans now have the highest median household income of any broad American ethnic group — European Americans included. Asian-American households average $66,000 a year, nearly a third higher than the median of all American households (which is $49,800). Whites average $54,000, Hispanics $40,000, and blacks $33,300.

Among Asian Americans, median annual family income varies. Indians average $88,000, Filipinos $75,000, Japanese $65,390, Chinese $65,050, Vietnamese $53,400, and Koreans $50,000. But all this is quite remarkable, considering that according to Pew’s figures, nearly three-fourths (74%) of Asian American adults were born abroad.




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The Student Loan Bubble

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The left-leaning web site ProPublica specializes in long-form journalism — labor-intensive, 3,000-plus-word articles dedicated to serious treatments of big subjects. Think of the long pieces that appeared in The New Yorker during the 1970s and early 1980s and you get the idea. While I find ProPublica’s reflexive and unexamined bias in favor of statist schemes irritating, I do read its articles. They are usually earnest and sometimes worthy efforts.

Lately, a ProPublica article about a semiliterate gardener’s struggles to manage his dead son’s unpaid college loans got some traction in the mainstream media. (While I don’t understand ProPublica’s business model completely, it seems to involve licensing its long stories to other news organizations.)

This gardener’s woes fit neatly into the mainstream media’s narrative that student loans are an evil, evil thing about which Good King Barack needs to do something. And, by “do something,” moronic opinion-shapers mean without saying: subsidize borrowers’ bad choices with capital redistributed from taxpayers.

This proposition is wrong on many levels. It also reflects faulty assumptions and bits of specious logic that are worth some examination — because they explain many of the problems that plague America today.

First, a quick review of ProPublica’s telling of the gardener’s tale.

Francisco Reynoso lives in Palmdale, California — a dusty far suburb, north of Los Angeles. He doesn’t speak much English (though he is a naturalized citizen) and earns about $20,000 a year from his labors. While the story doesn’t offer many details about Reynoso’s work, in southern California “gardener” is often a euphemistic way to describe a causal day laborer — the kind of guys you see milling around Home Depots and such outlets, looking for work.

On this meager income, Reynoso supports his wife and daughter. He used to support a son, too. But, in a tragic turn, that son — Freddy — died in a one-car accident in September 2008.

Freddy had recently graduated from Berklee College of Music, a school in Boston that combines elements of a conservatory with the rigors of a traditional four-year college.

It was a bit strange that a gardener’s son had matriculated to a place like Berklee. It’s no community college . . . or even a state university. Rather, its reputation has long been as a pricey second-tier Julliard. The school’s comprehensive fee is nearly $50,000 each academic year.

A lazy person might describe Freddy’s enrollment at Berklee as a version of “the American Dream.” The son of a laborer enters a world traditionally reserved for the elite, etc. But it sounds like Freddy never really entered that world. In 2005, after he’d been admitted to Berklee, the young man needed to borrow significantly to enroll. Reynoso cosigned on a series of student loans that allowed Freddy to attend. By 2008, when Freddy was finished at Berklee, he moved back to Palmdale and was driving into Los Angeles most days. Trying to find work. According to his family, Freddy was driving back from the city on the night that he ran off the highway, rolled the car, and died.

As a father, perhaps Reynoso should have told Freddy that borrowing hundreds of thousands of dollars to get a degree in music was a bad financial decision.

The principal amount of the money Freddy and his father had borrowed was nearly $170,000. With interest and fees added, the amount they’d have to repay would be closer to $300,000. The lenders didn’t mind much that Reynoso didn’t have the means to repay those amounts because, as we’ll see in more detail later, various government subsidies that support the student-loan market make rigorous underwriting unnecessary.

So, lenders lend. But why do borrowers borrow? Why did a gardener making little more than minimum wage agree to guarantee so much in college loans? His answer: “As a father, you’ll do anything for your child.”

It may not seem sporting to criticize a simple man’s devotion to his son . . . but what if that devotion is ignorant and misguided? According to a survey of music industry salaries produced by Berklee itself (and based — tellingly — in the “Parent Questions” section of its web site), most of the jobs its graduates pursue offer starting pay of less than $25,000 a year. That’s not enough income to support the debt service on nearly $200,000 in student loans.

As a father, perhaps Reynoso should have told Freddy that borrowing hundreds of thousands of dollars to get a degree in music was a bad financial decision. Some people are poor because they make bad financial choices. An unintended consequence of government programs that give material support to such poor people is that they’re free to make more bad choices. In the hands of Francisco Reynoso, Freddy’s government-subsidized student loans were a loaded gun . . . or a hangman’s rope.

A few months after Freddy’s fatal accident, collectors started calling Reynoso to demand payment on the student loans for which he’d cosigned.

The loans that allowed Freddy to attend Berklee fell into several categories — as they do for most borrowing students. There were some direct government loans, which carry the lowest interest rates and most favorable terms for the borrower. In most situations, they don’t require parents to cosign. But there are limits to the amounts available on these favorable terms; in most cases, a student can only get a few thousand dollars each academic year in this “cheap” money.

After that, a borrowing student needs to go to so-called “private” lenders. These are banks and specialized finance companies that offer loans with higher interest rates and less-favorable terms for borrowers. But the “private” loans are still subsidized heavily by the government and share unique traits with the direct government loans — most importantly, the loans cannot be discharged in bankruptcy.

(A personal aside: When my oldest child was getting ready to leave for college, we reviewed her finances and found we were a little short on the cash she would need for her comprehensive fee. She shook off the shortfall as no big deal; the college was happy to help her apply for student loans. I advised her only to borrow as much as was available in direct government loans and to avoid the higher-interest private loans at all costs. She rightly noted this advice was ironic, coming from someone who advocates against such government programs; but she heeded the irony and will graduate next year with a nominal amount of relatively cheap debt to repay.)

This is the major reason why the “private” student-loan lenders don’t bother with rigorous underwriting. Since the loans can’t be discharged in bankruptcy, the lenders or their agents can hound borrowers and cosigners for repayment endlessly.

In Freddy’s case, he borrowed about $8,000 in private money from Bank of America and about $160,000 from a company called Education Finance Partners. Neither lender kept the loans for long; as is typical in the market, the “loan originators” sold Freddy’s paper to other firms that focus on servicing debt or bundling it with other student loans and “securitizing” those bundles.

According to ProPublica, Bank of America sold the loan it made to Freddy to a student-loan financing specialist called First Marblehead Corp.; Education Finance Partners, which has since declared bankruptcy, sold the loans it made to Freddy to a unit of the Swiss banking giant UBS.

The loans purchased by UBS may have been sold, in turn, to the Swiss National Bank (analogous to the U.S. Federal Reserve) when the National Bank made a Fed-style bailout of UBS in 2009. Details are sketchy because of Swiss privacy laws.

So, if the ownership of the debt was unclear, who were the collectors calling Reynoso for repayment? A separate company, called ACS Education Services, which owns some student debt and contracts with other lenders to manage and collect on their loans for a fee. ACS is a unit of Xerox Corp. and one of the bigger players in the student-loan servicing market.

But Freddy was dead — and one might think that that fact would have an effect on the lenders’ collection efforts. Some student loan companies have a policy of canceling loan balances when a borrower dies. (Direct student loans from the government are generally cancelled if the borrower dies.) But, since Reynoso had cosigned for his son’s “private” loans, the lenders have the legal right to pursue payment from him.

A fundamental fraud lies beneath all this do-gooder claptrap. And that fraud may eventually destroy the foundations of many schools.

It’s easy — and emotionally satisfying, perhaps — to focus outrage at lenders like Bank of America and Education Finance Partners, or behind-the-scenes operators like First Marblehead or ACS Education Services. The establishment Left and media outlets like ProPublica certainly focus on them.

But these lenders and finance outfits are really just service providers, working the levers of government to find ways to make a few points here or there while helping to facilitate state-sponsored transactions.

The core transaction in the ProPublica story was between Freddy Reynoso and the Berklee College of Music. Freddy was pursuing a dream of being a professional musician and Berklee was selling an expensive credential that might help in that pursuit.

Freddy died. But Berklee is doing well. It has an endowment of nearly $200 million and is in the midst of an ambitious expansion of its campus — which at present comprises of some 21 buildings in the Back Bay area of Boston. The College’s website described the opening of one new building in this way:

Adorned with bright colors, the unique and hip space has an industrial feel, in step with Berklee’s cutting-edge sensibility. The building also houses the Berklee Writing Center, Berklee’s English as a Second Language Program, an Africana Studies Room, conference and seminar rooms, and a café.

More hip space in the Back Bay is in development. And Berklee has recently opened a satellite campus in Valencia, Spain.

According to a September 2011 report from the Center for Social Philanthropy and the Tellus Institute, Berklee President Roger H. Brown makes more than $550,000 a year. And five other senior administrators make more than $300,000 a year. It’s good money — although, by elite college standards, it’s not that much.

President Brown’s official biography recounts sanctimoniously the work that he’s done in places like Thailand and the Sudan for various humanitarian outfits (some connected with United Nations). It boasts about the big child-daycare company he started with his wife, but it doesn’t mention the years he spent working for Bain & Co.

I’m sure Mitt Romney will understand.

Of course, the bio focuses on the efforts Brown has made to move Berklee closer to the first-tier of private colleges:

In 2007, Brown launched the college’s first capital campaign with a goal of raising $50 million. He has initiated Berklee’s Presidential Scholars and Africa Scholars programs that provide full-ride scholarships to give top musicians around the globe a Berklee education. He has overseen the expansion of the City Music Program beyond Boston in an effort to provide educational opportunities for talented but economically disadvantaged urban youth. . . . Brown worked with the city of Valencia, Spain, and the Generalitat Valenciana to create a Berklee campus in Valencia.

He’s the very model of a modern major-general. Working the levers of government in Spain to set up a ritzy international campus. Overseeing the expansion of programs to provide for the disadvantaged. Initiating programs to give scholarships to top musicians around the globe.

But a fundamental fraud lies beneath all this do-gooder claptrap. And that fraud may eventually destroy the foundations of schools like Berklee College of Music.

For decades, striving institutions of higher education have been working the levers of government — and, specifically, the student loan market — to redistribute capital from the lower and middle classes into their self-styled “elite” pockets. A regressive racket if ever there was one.

The pieces are all present in Freddy Reynoso’s story. Nearly $200,000 was taken from people who can’t afford it, facilitated by banks and the federal government, and transferred into the coffers of a music college already sitting on an endowment of several hundred million. If the sanctimonious Roger H. Brown really wanted to help disadvantaged youth, he should have given Freddy Reynoso a free ride. But why should he do that? Uncle Sam is willing to arrange for Berklee the pretense of high-minded altruism and the profit margins of a payday lender.

Roger H. Brown won’t stop this deal. So Uncle Sam needs to.




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It’s a Gas

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The massive growth in the production of natural gas, the result of using unconventional sources and methods (mainly the fracking of shale deposits) continues to demonstrate how free markets can transform the world, even in the face of statist oppression.

Two recent Wall Street Journal pieces illustrate this anew. The first reports that another industry is now converting its vehicles from diesel to natural gas — an industry you might not think of offhand. Ferryboat fleets, both here and in Canada, are making the switch because of the continuing (shale-)rock-bottom prices of natural gas.

From Staten Island to Washington State and British Columbia, ferry fleets are following the lead of Norway, which a decade ago started fueling ferries with liquefied natural gas (LNG).

One attraction of natural gas is, again, its pricing. Natural gas at the Henry Hub distribution center (a standard benchmark for natural gas pricing) hit a low of $1.95 per million BTUs this year, the lowest price in 13 years. This, while diesel skyrocketed by 140% from 2004 to 2011.

A second attraction is that, if spilled, LNG doesn’t form a toxic slick that requires costly cleanup, even as it should be so unfortunate as to kill off wildlife, or tourists, or both.

Third, LNG is actually less likely to be unfortunate, because it is less inflammable than diesel.

Of course, the switch will take time and upfront investment — as for instance, to build plants to chill and compress the gas, and new holding tanks for the ships. But the cost savings make the decision obvious, even if the timing isn’t.

The second WSJ piece is of more — shall I say — global importance. It reports that more and more US utility plants are switching from dirty coal to clean natural gas, not because of EPA coercion, but because of the coercion of free-market pricing.

Coal consumption by American power companies dropped by 18.8% in the fourth quarter of last year, compared to the previous quarter, and 9.4% compared to the fourth quarter of the year before. Again, the switch was driven by the drop in natural gas prices.

Peabody Energy, one of the biggest coal producers in the world, now estimates that American coal demand will drop by 10% this year, or 100 million tons.

The free market is helping to reduce air pollution. Obama, are you paying attention?




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The Anthem Film Festival — A Report from the Scene

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This month in Las Vegas, The Afghan Nightmare took the FreedomFest Grand Prize at the annual Anthem Libertarian Film Festival. The film is remarkable for its stunning cinematography, dramatic story arc, and powerful message. Director Klaus Erik Okstad spent four months embedded with the Norwegian army as they labored to prepare Afghan forces for NATO troop withdrawal in 2014. This intense, eye-opening documentary demonstrates the futility of modern "nation-building" warfare. We see how ill prepared the Afghans are to defend their own people after more than a decade of someone else’s doing it for them. In one telling example, the Afghan soldiers refuse to walk from the main headquarters to an outpost just one kilometer — barely more than half a mile! — away, and demand that the Norwegian soldiers build them a road and give them a Jeep. It's the welfare principle in practice, destroying courage, skill, and self-reliance.

Documentaries stood out at Anthem this year. Films took viewers around the world as they explored issues of freedom, choice, self-reliance, and accountability. In addition to "visiting" Afghanistan, attendees met seven unlikely Detroit entrepreneurs in Men at Work. Entered the fascinating world of business in Ayn Rand & The Prophecy of Atlas Shrugged. Visited four continents with best-selling author Dinesh D'Souza in his pursuit of Obama's past. Explored the facts surrounding global warming in An Inconsistent Truth. Debated the risks and rewards of vaccinations in The Greater Good. Learned more about states' rights and the constitution in Nullification: The Rightful Remedy. And visited a tiny village in Honduras where a disabled man has been building a helicopter for the past 50 years. In his shed.

Anthem is in its second year as part of FreedomFest, "the world's largest gathering of free minds," where over 2,000 attendees and 150 speakers gather each year to discuss politics and economics, science and healthy living, arts and history — and now, movies.

Anthem's goal is to give libertarian filmmakers a venue and a community. Janek Ambros came last year as an attendee and went home with the determination to make a film that would be accepted for screening at Anthem. This year he submitted his short narrative Closing Bell, which takes viewers inside the mind of a stockbroker in the final four minutes of trading as the market was collapsing in 2008. Closing Bell was not only accepted; it won the award for excellence in filmmaking in that category. Others attending Anthem and FreedomFest this year expressed a similar determination to make worthwhile films with self-reliant protagonists and libertarian values. They also networked with seasoned film makers and producers.

Husband and wife film makers Ted and Courtney Balaker each submitted films, albeit in noncompeting categories. Courtney's short narrative The Conversation, about a likable college couple discussing libertarian principles over coffee and tea, won the award for Best Libertarian Ideals. Not to be outdone, Ted won the same award for his short documentary Don't Mess with Firefly, about a professor at the University of Wisconsin who was forced to remove a poster of the cult classic TV show Firefly from his office door because it posed a threat of violence. Yes, the poster was considered armed and dangerous. FIRE (Foundation for Individual Rights in Education) stepped in to safeguard the professor's right to free speech, with a little Twitter help from the TV show's stars, Adam Baldwin and Nathan Fillion, and bestselling writer Neil Gaiman.

Harmon Kaslow and John Aglialoro, producers of the Atlas Shrugged movies, closed the festival with a preview of Part 2, which will open in theaters October 12 of this year. Part 2 has a new cast, new director, new scriptwriter, and even a modern setting, "the day after tomorrow," as Rand wrote in the book. They also updated the cast to include ethnic diversity that would be more reflective of a modern near future. How might Ayn Rand, who demanded (but was never granted) script approval in her lifetime, feel about this change in her characters? "Rand's all-Caucasian cast was realistic in the 1950s," Kaslow explained, "but it would not be realistic for the day after our tomorrow." Part 2 will be screened at Anthem next year.

The Anthem Film Festival was one of the most popular events at FreedomFest. Films were screened to SRO crowds who lined the walls and sat on the floor, even after additional seating was provided. It is providing a venue for libertarian filmmakers and film lovers alike. What will next year bring? We can't wait to see.




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Dangerous Mood Swings

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On June 27, appearing on the Hannity show, Karl Rove responded to a question about what would have happened if President Bush had set aside laws in the way in which President Obama set aside the immigration law. “All heck would have broken loose,” Rove replied.

Karl Rove is 61 years old. He was talking on the network that runs the “Red Eye” show (which, unlike the Hannity show, is pretty good once you get used to it). But he wouldn’t say the word “hell.” He said “heck” instead. And “hell” isn’t a coarse expletive. It isn’t even an expletive, really. It is rumored to be a place. Yet Rove was behaving like the clergyman whom Alexander Pope satirized 300 years ago — the “soft dean” who “never mentions hell to ears polite.”

Ordinarily, as you know, this column collects examples of verbal ineptitude, comments upon them, and weaves the commentary subtly into one thematic whole. This month, that can’t be done. There are just too many discrete (in the sense of separate) bits of wreckage flying past us. One can only gaze and marvel as they cross the eerie sky that we call modern discourse.

Look, there’s another one! Have you noticed that every single “public figure” you encounter now says “we” when he or she can’t possibly mean anything more than “I”? People of all parties do this. Ron Paul does it. Barack Obama does it. Mitt Romney does it all the time. Scott Walker, who relieved some of my worries about the future of the republic by winning his recall election in Wisconsin, does it so often and so confusedly that I can hardly stand to listen to the poor guy. It used to be that politicians were laughable because they said “I” all the time. Now they say “I” in a much more nauseating way. They use a “we” that means, simultaneously, “I am too humble to say ‘I,’” and “I am too mighty to say ‘I’ — observe the hosts that follow me.” Actually, of course, the person saying “we” is just that one strange-looking guy, standing at the bottom of the swimming pool, talking incessantly to himself.

On to the next disaster. San Francisco has just experienced a mass landing of verbal flying saucers. There exists in that city a man named Larry Brinkin. Thirty years ago, this man sued his employer, the Southern Pacific Railway, for allegedly refusing to give him three days off to mourn the death of his male lover, the same three days the company allegedly gave straight people to mourn the deaths of their spouses. Because Brinkin kept doing things like that, he was given a job as an enforcer for something called the San Francisco Human Rights Commission, which uses tax money to procure the votes of modern liberals by hunting down private individuals who allegedly treat gay people, “transgendered people,” foreign people, fat people, short people, and probably many other people in “discriminatory” ways. One of Brinkin’s accomplishments, I believe, was spending years worrying a gay bar for its alleged racial discrimination in admitting customers. A larger accomplishment is alleged to have been (sorry, I need to use “allegedly” a lot in a column like this) the invention of a phrase, “domestic partner.” Some accomplishment. Sounds more like a poodle to me.

Let me be clear. If the railway refused to give him three days off, it did an indecent thing. Discriminating against people because you look down on their race, religion, or sexuality is always indecent. But so, in my opinion, is devoting your life to demanding that other people give you stuff, or you’ll send the law after them.

Anyway. Two years ago, for the inestimable work he had done for human rights, and for retiring from his $135,000 a year city salary, Brinkin received a great public honor. The city declared a “Larry Brinkin Appreciation Week” (one day was just not enough), in recognition, it was said, of his “advocacy.” The retired civil servant, about whom you now know 100 times more than almost anyone who lived in San Francisco at the time, was pronounced by all available media a “gay icon,” a “beloved icon,” and every other kind of “icon” that can puff up a lazy text. But after June 22, San Franciscans learned, or thought they learned, a great deal more than they had known before, because on that day Brinkin was arrested for (once more allegedly — and this time the word really does deserve the emphasis), having had something to do with child pornography. He had also, allegedly, made racist remarks pertaining to the subject, although that is not illegal, even in San Francisco.

Discriminating against people because you look down on their race, religion, or sexuality is always indecent. But so is devoting your life to demanding that other people give you stuff, or you’ll send the law after them.

The charges, I am happy to say, are not the business of this column. I have no idea what really happened, or what he really did, if anything. Perhaps I will have a better idea, once the police department’s “forensic” experts complete what has turned out to be a very longterm “study” of Brinkin’s computers. And perhaps I won’t. But the verbal reactions to the matter — those are things within the interest and competence of us all. And they don’t reflect very well on the City by the Bay, which is allegedly so well supplied with intelligence and sophistication.

Icon was in every headline, as if Larry Brinkin’s picture, rendered in a Byzantine style, encrusted with jewels, and lit by votive candles, was a fixture of every church and civil-servant cubicle in Northern California. One of Brinkin’s organizational associates got media attention by saying that she was surprised by the charges, because . . . Guess why. Because he was a “consummate professional.” In the religion of the state, the corporations, and all those occupations in which people must conform to the rules of some “peer” association, professional is not the neutral term it was a mere 20 years ago. It is now a term of absolute value, a universal replacement for ”virtuous,” “admirable,” and all those other words for “morally swell.” Coupled with such terms as “consummate,” it offers prima facie grounds for sainthood, for membership in that exclusive order of men and women who have been selected by their peers for the highest forms of recognition they can imagine and bestow: a picture on the coffee room wall, a place in the Civil Servants’ Hall of Fame and Museum of Professionalism, and at last a funeral in the Executive Conference Room, where colleagues will be invited to step forward and voice their memories of how well Old So and So took care of the paperwork when SB 11-353 was working through committee.

Here’s a politician — one Bevan Duffy, a busy bee about San Francisco, and the caring soul who sponsored the Larry Brinkin Appreciation Week — responding to Brinkin’s arrest: "I have admired and respected his work for the LGBT community. . . . I respect and am confident that there will be due process." Grammar flees where professionalism reigns. Mr. Duffy respects that there will be due process.

Here’s another colleague — the “executive director” (how does that differ from “director”? — but I guess that’s a professional mystery) of the Human Rights Commission, as quoted in a report by Erin Sherbert of the SF Weekly:

We put in a call to Theresa Sparks, executive director of the Human Rights Commission, [who] told us this allegation is "beyond hard to believe."

"It's almost incredulous, there's no way I could believe such a thing," Sparks told us. "He's always been one of my heroes, and he's the epitome of human rights activist — this is [the] man who coined phrases we use in our daily language. I support Larry 100 percent, hopefully it will all come out in the investigation."

It’s not surprising that someone who can’t tell the difference between “incredulous” and “incredible” would regard Larry Brinkin as a hero of the English language. But to be a true professional, especially in a governmental or community context, one must have a grasp of all the inanities with which government workers are equipped. And what a parade of them we see here — beyond hard, one of my heroes (of whom there are, no doubt, countless thousands who are yet unsung), epitome, activist, I support, 100 percent, and that indispensable lapse from basic grammar, hopefully. Nothing more could possibly be required. But by the way, what do you think of this apostle of justice declaring that “there’s no way” she’ll believe what the evidence shows, if it doesn’t show what she already believes?

In the religion of the state, “professional” is not the neutral term it was a mere 20 years ago. It is now a term of absolute value, a universal replacement for ”virtuous,” “admirable,” and all those other words for “morally swell.”

There once was a time when a president of the United States, himself an uneducated and, some said, an illiterate man, could respond to legal opposition in a memorable and verbally accurate way. Referring to a decision written by Chief Justice Marshall, President Jackson said, “John Marshall has made his decision: now let him enforce it.”

Contrast our current Attorney General, Eric Holder (you see, now I’ve had to switch to another, unrelated track), responding to the vote by which the House of Representatives charged him with contempt of Congress. “Today’s vote,” he said, “may make good policy feeder in the eyes of some . . .” He then continued with the usual blather. But I had stopped listening. What stopped me was “feeder.” Clearly, the Attorney General has never been around a farm, or wasn’t listening when he was. And clearly, he’s not hip to ablaut, the means by which one type of word becomes another type of word by changing one of its vowels. Farm animals are sometimes fed in feeders, and the feed that some animals are fed is fodder — not feeder. But why worry about ablaut, or exposure to agricultural conditions? Like his boss, President Obama, who got through Harvard Law without discovering that there is any difference between “like” and “as,” Holder just doesn’t seem to read or listen.

But he’s nothing compared to Jerry Brown, California’s version of Joe Biden — except that he’s even worse in the words department. Brown’s utterances are commonly described as “babble,” despite the fact that their purpose is always clear: increase the power of government. His obsession right now is California High-Speed Rail, an attempt to “create jobs” for union employees by building the largest public-works project in American history, a rail line between San Francisco and Los Angeles. Two years ago, he convinced a majority of voters to approve the project. Today, even its friends concede that it will cost three times more than mentioned in the bond referendum, that it will not and cannot be high-speed, and that it may not even enter San Francisco or Los Angeles. Nevertheless, on July 6, the California legislature authorized a set of bonds for what many now regard as the Browndoggle. Ignoring the language of the referendum, which stipulated that the money should go for a high-speed train and nothing else, the solons proudly allocated billions of dollars to such things as buying new subway cars for San Francisco.

That’s the background. Here, in the foreground, babbles Jerry Brown, who on one of the many occasions on which he “argued” for “high-speed” rail, intoned: “Don’t freak cuz you got a few little taxes. Suck it in.” Brown doesn’t even know the difference between “suck it up” (a vulgar term for “endure it”) and “suck it in” (a vulgar term for faking weight loss).

Jerry Brown’s utterances are commonly described as “babble,” despite the fact that their purpose is always clear: increase the power of government.

Let’s put this in perspective. President Obama, campaigning among morons, or people he regards as morons, drops hundreds of final “g’s” in every speech he gives, and regularly converts “because” to “cuz.” You’ve heard of the hoodlum priest? This is the hoodlum president. But there are people still more vulgar than he, people who speak on serious public occasions in the language of the drug-lost: “Don’t freak out.” Some of them go so far as to omit the “out,” thereby demonstrating that they’re at least as jivy as the jiviest 65-year-old. Other public figures innocently reveal that they’ve gone through their whole lives without a basic knowledge of English-language idioms. Thus the acclaimed Spike Lee, prattling on Turner Classics (July 5) about the last scenes in On the Waterfront, and describing what happens to the Marlon Brando character: “The thugs beat him an inch within his life.” And of course the rich are always with us, in the form of politicized tycoons who lecture us about being a low-taxed people, compared to the Europeans or the Russians or somebody else. Every day of our lives, we in California hear this kind of thing from professors and pundits, politicians and thinktank fishies, despite the fact that our savage sales tax and still more savage income tax put us in the front ranks of slave labor in the United States.

All right. Let me summarize. We’re used to hillbilly talk, and drug talk, and pressure-group talk, and impudent talk, and just plain ignorant talk. Then Jerry Brown comes along, and runs all the bases: “Don’t freak cuz you got a few little taxes. Suck it in.”

Is this what wins the ballgame? What happened to the people on the other team? (No, I’m not thinking about the Republican Party. I’m thinking about people with a normal command of the English language.)

Maybe they’re suffering from the demoralizing condition that afflicts Rep. Jesse Jackson, Jr. Some weeks ago, Jackson stopped showing up in Congress. For quite a while, it seems, the absence of the nine-term Congressman wasn’t noted. Then colleagues started theorizing that he was being treated for exhaustion, because of all the hard work that congressmen have to do. Others, including NBC Nightly News, entertained suspicions that Jackson was being treated for something much more serious. Finally, as reported by Rachel Hartman on Yahoo News (July 11), the nation learned the truth:

“The Congressman is receiving intensive medical treatment at a residential treatment facility for a mood disorder," Jackson's physician said in a statement provided to Yahoo News via the congressman's congressional office. "He is responding positively to treatment and is expected to make a full recovery." The statement indicated that Jackson's attending physician and treatment center "will not be disclosed in order to protect his continuing privacy."

Privacy? Jesse Jackson, Jr.? That’s funny. Continuing privacy? That’s beyond funny.

Speaker Boehner, always the man with le mot juste, may be right in taking a cautious and distant approach to Jackson’s illness: “This is an issue between he and his constituents.” And it’s good to know that President Obama isn’t the only one who has this curious way with pronouns that follow prepositions. But if you’re laughing about Jackson’s mood disorder, I’m here to tell you that the condition is real, and serious. By the time I’ve finished one of these columns, I too am ready for a residential treatment facility.




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Neo-Socialism: The Results Are In

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Despite his campaign promise to govern as a moderate, President Obama has aggressively pursued what can only be described as neosocialist economics. This is a system of governance within which the government essentially runs business, but not in its own name — so that when failures occur, it can disown responsibility and blame business instead. It is a new and “improved” socialism, so to say.

The program has included outright government takeovers of most of the auto industry and the student loan industry, massive new control of the financial industry, near total control of the health industry, near total dominance of the energy industry, stimulus spending bills (often favoring campaign donors), housing bailouts, cash for clunkers, cash for weatherproofing, and so on. All of this is Obama’s doing. So is the $5 trillion he has added to the national debt — pushing us past France in debt as a percentage of GDP.

The result has been a long, lingering malaise — the Obamalaise — posing as a “recovery.”

The latest jobs report starkly illustrates the failure of Obamanomics. It shows that last month the economy — in the third year of an economic recovery — created a ludicrous 80,000 jobs. Considering that the economy needs to create about 125,000 new jobs each month just to keep up with population growth, this was a profoundly pathetic report card. The unemployment rate stayed at 8.2%, only because — again — more people dropped out of the work force.

Worse, of the 80,000 jobs created, 25,000 of them — nearly a third — were temp jobs.

Even worse, in June, while a net 80,000 jobs were created, 85,000 people went on federal disability! Yes, more people got on the SSDI disability rolls than got productive jobs. Indeed, since June 2009, while Obamanomics has created 2.6 million jobs, it has put nearly 3.1 million new people on SSDI disability. Moreover, a whopping 275,000 additional people have applied for disability. Obama is truly the Disability King.

Add to this the fact that yet more people went on food stamps, cementing Obama’s rightful title as the Food Stamp King. In fact, from June 2009 to April of this year, the number of food stamp recipients exploded upwards by 11.3 million, or nearly a third.

Amazingly, while Obama has his highest support among blacks, followed by Hispanics, and his lowest support among whites, it turns out that white unemployment stands at 7.4%, Hispanic unemployment at 11%, and black unemployment at a gut-wrenching 14.4%.

The general unemployment rate has now been over 8% for 41 months in a row, which sets another new record — one that beats all previous administrations over the last six decades. And the length of time the average person has been unemployed under Obama’s “recovery” has been 20.6 weeks, completely eclipsing the earlier record of 10.5 weeks.

If the labor force participation rate were now what it was when this neosocialist administration took power, the unemployment rate would be 10.9%. It is only as “low” as it is because many people have stopped “participating” (i.e., looking for jobs).

Three years of Obamanomics recovery has created job growth of 75,000 a month on average, or 2.6 million in total. By contrast, Reaganomics (neoliberalism) over the same length of time averaged 273,000 a month, or 9.8 million in total.

Of course, the nation was smaller then. If we correct for population size, the Reagan neoliberal recovery produced the equivalent of 360,000 jobs a month over the same period, or a total of 13 million.

The “recovery” brought by Obamanomics created a total expansion of real GDP of only 6.7% over eleven months. Again, by comparison, Reaganomics brought a total expansion of real GDP of 17.6% in the same period — or well over two and a half times as great a growth rate.

So what shall we call the president: The Disability King? The Food Stamp King? The Long Term Unemployment King? The Slow Growth King?

Perhaps “the clown-prince of neosocialism” will do.




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In the Cloakroom

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Up in Smoke

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With the recent release of yet another dismal jobs report, commentators in the MSM have begun to ask, “Why aren’t jobs being created?” They should have been asking themselves this question for the last 40 months, but, hey, better late than never.

Yet the possibility that the explosive growth in regulation might play a role in deterring job growth is not something they spend much time discussing.

It should be.

A recent story gives us a fresh illustration of the role that regulation plays in destroying jobs. (By “regulation,” I mean all increases in statutory law, rulings by regulatory agencies, and expansions of common law aimed at controlling business activity.) It concerns a business that I, a nonsmoker, never heard of, one that has never been destroyed by regulation.

It turns out that in the face of huge taxes on cigarettes produced by the major tobacco companies, many cigarette smokers started frequenting small stores that owned “roll-your-own” (RYO) cigarette machines. The RYO machines allowed customers to buy loose tobacco, especially pipe tobacco (taxed at a far lower rate than manufactured cigarettes) and paper tubes in the shop, and use the RYO machine to churn out a carton of cigarettes in just a few minutes.

For a devoted smoker, the attraction of RYO shops is clear. They save about half the price of regular cigarettes. And they allow smokers to blend different and more flavorful tobaccos together, and use both tobacco and paper that are free from many of the chemical additives.

But naturally, the attractiveness of the shops angered two powerful groups. First, it pissed off puritan “progressives” who just cannot stand people smoking, and are always conducting an anti-smoking jihad. Not content with insane taxes on people who choose to consume a lawful product, they want to stop it altogether.

Second, it pissed off the major cigarette makers — aka Big Tobacco — who hate seeing customers choosing to buy cheaper in little shops around the country.

So in a classic case of rentseeking (businesses manipulating the regulatory system to hurt their competition, rather than producing a better or cheaper product) Big Tobacco found a politician — the truly execrable Sen. Max Baucus (D-MT) — to insert a small amendment to a massive transportation bill that redefines RYO shops so that they fall under the same category as Big Tobacco cigarette manufacturers, thus imposing a massive tax increase on them — one that is intended to destroy them, and probably will.

Baucus of course was happy to do this for the campaign cash Altria and other Big Tobacco companies shoveled at him. And those Big Tobacco companies are happy to stomp out of existence a group of little competitors. And Obama — who never met a regulation he didn’t like — was happy to sign the bill.

But the small businesses that bought the RYO machines have been screwed. Over a thousand of these machines (they cost over $36,000 each) were purchased, but are now virtually useless.

So, for example, Robert Weissen and his partners, who own a chain of six RYO shops in Las Vegas (cheekily named “Sin City Cigarette Factory”), says he will have to shut down the machines and lay off 40 people.

There are eight million regulations in our “progressive” (i.e., neosocialist) economy. This has been the story of just one of them.




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Fungible Semantics: The Roberts Decision

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Tax: A contribution for the support of a government required of persons, groups, or businesses within the domain of that government.

Penalty: A punitive measure, regulatory in nature, established by law or authority, to deter certain conduct.

A Supreme Court decision upholding the constitutionality of the healthcare mandate based on the government’s taxing authority?

Well, why not? The tax code has been dragooned into service to influence and shape social behavior for over a hundred years, from a dollar-a-pack cigarette tax, to mortgage relief to encourage home ownership. In addition to the collection of revenue to bankroll government it evolved into an instrument for social engineering and stealth workarounds to advance social policy. Which of the following statements is true?

A tax raises revenue, a penalty raises revenue, therefore a penalty is a tax?

A tax influences behavior, a penalty influences behavior, therefore a tax is a penalty?

That’s right — neither is true. These syllogisms illustrate a well-known logical fallacy that can be found in any college textbook on logic. How, then, could a superior jurist like John Roberts persuade himself that a penalty is a tax? Well, the Chief Justice opined that the penalty for noncompliance with the mandate ($695) was too weak to constitute a deterrent, and must therefore be a tax! This left many to wonder if he had intentionally confounded these two concepts, and thus rewritten the mandate so the Affordable Care Act would pass constitutional muster.

The logic was so bizarre and flawed that some, like Charles Krauthammer, suggested that Roberts resorted to this semantic legerdemain to avoid politicizing the Court and weakening its prestige. But this is to forget that the Constitution was born in crisis and the Court has weathered more violent partisan storms than those of the current climate: just read some of the broadsides in newspapers written one hundred to two hundred years ago. To my knowledge, no Congressmen have been caned to within an inch of their lives in the well of the Senate (though, no doubt, some have deserved it), and no cabinet secretaries killed in duels in the past 100 years. A good rule of thumb: follow the law and let the chips fall where they may.

Misconstruing what is obviously a penalty as a tax may seem a harmless bit of hocus pocus, but playing hard and fast with meaning and general disregard for semantic precision has resulted in a Supreme Court decision that could have unfortunate consequences for the American economy. Or as one editorialist (James Delong) put it:

The ACA is a complex and incoherent law drafted in haste and secrecy, written largely by the healthcare industry to promote its own profits by bringing more people into a government-administered system open to capture and looting. It is defended by an administration trapped by the imperative of defending its handiwork. The product is a Rube Goldberg regulatory system that cannot be made rational, workable, or intelligible, and is a delicious (to Republicans) promise of an endless stream of outrages.

It is all very well for the Chief Justice to defer the issue of constitutionality back to elected officials, but as Ronald Reagan once remarked, “The nearest thing to eternal life we will ever see on this earth is a government program,” and it will be difficult to impossible to repeal the healthcare law even if Mitt Romney is elected president, unless there are significant Republican majorities in both houses of Congress. The stakes were high, very high. This could be the worst Supreme Court decision since Kelo v. City of New London, and it is fair to ask if, during his stormy sessions with the brethren, Justice Roberts experienced some sort of mental lapse.

In the last century or so, no Congressmen have been caned to within an inch of their lives in the well of the Senate — though, no doubt, some have deserved it.

The original sin was, of course, using the tax system as a quick-and-dirty tool to improvise policy, to encourage (say) petroleum exploration or to discourage the use of tobacco, thereby exempting government from the strenuous work of writing carefully crafted long-term programs to advance a coherent policy. The Constitution says that

The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States . . .

The framers did not say that the collection of taxes could or should be used to influence economic behavior or placate special interests, and in this they showed some foresight: broadening the concept of taxation to, for example, provide incentives for certain economic entities, has resulted in a Byzantine tax code so complicated and unwieldy, so corrupted by influence-peddlers and lobbyists, it has become a national embarrassment, and a general disincentive to business and entrepreneurship. Using the sacrosanct tax code as an ad hoc tool to implement policy (rather than enact problem-specific programs) has produced some very bad tax law.

Another institutional casualty, perhaps more fatal than the debasement of the tax system, has been the English language. A general contempt for the elegance and precision of English, e.g. twisting of meaning out of all recognition, demonstrates the dangers that George Orwell warned us about over 60 years ago in his essay, Politics and the English Language. The decline of English, he observed, had entered a deadly spiral:

it becomes ugly and inaccurate because our thoughts are foolish, but the slovenliness of our language makes it easier for us to have foolish thoughts.

It was Orwell’s belief that words and semantic distinctions matter, that mangling language to suit one's purposes eventually leads to a world where black is white and up is down. How prophetic! We need language to map the world as it is, not as we would like it to be, and a breach of semantics can be even more lethal than a breach of law. Using imprecise language to conceal real meaning is a sure path to chaos. Orwell was talking about communist pamphleteers and flannel-mouthed journalists at the time, but it applies equally to any abuse of language, and that includes the recent decision by Chief Justice Roberts to call a penalty a tax.




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Eight Million Regulations

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There is a classic film noir called The Naked City (1948). The film’s plot is the investigation of a murder, and the story takes place in New York City. At the end of the flick, a narrator intones a famous line: “There are eight million stories in the naked city. This has been one of them.”

Reading a recent report on the latest regulations laid down by the Justice Department for compliance with the Americans with Disabilities Act, I thought of a new take on that line: “There are eight million regulations in the Obama state. This is just another flock of them.”

In an effort to ensure perfect “fairness” for all the “disabled,” the feds now dictate the following.

  • Amusement parks must provide at least one seat for the wheelchair-bound on any new or altered ride.
  • Miniature golf courses must make at least half of the holes “accessible,” defined as having a surrounding ground space that is “48 inches minimum by 60 inches minimum with slopes not steeper than 1:48 at the start of play.”
  • Regular golf courses must now have “an accessible route to connect all accessible elements within the boundary,” and must also “connect golf cart rental areas, bag drop areas, teeing grounds, putting greens, and weather shelters.”
  • Gyms must now position at least one of each type of exercise machine so that it is accessible to the wheelchair-bound.
  • Saunas must now provide accessible turning spaces and an accessible bench.
  • Shooting ranges must now provide accessible turning spaces “for each different type of firing position.”

My favorite is this one: all public accommodations must allow miniature horses as guide animals, because some handicapped people have moral or religious problems with dogs.

The good news is that the feds rule out full-size horses. Why, I don’t know — couldn’t some handicapped people have moral or religious problems with both dogs and miniature horses?

The miniature horse rule brings to mind another line I remember from the past: Frank Zappa’s song about Montana — “Just me and the pygmy pony, over the dental floss bush.”




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The Metaphor to Nowhere

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Recently I was invited to attend a national educational conference for college teachers and administrators. I was also invited to send a proposal for a presentation at the conference. I was slightly doubtful about the value of the conference when my proposal was accepted without any vetting — I wasn’t asked to supply my credentials, my background, my experience in the field, or the literature (if any) that I would be using for my presentation. As a matter of fact, I have no specific training in the subject. I have been working in an administrative position for less than a year, and it is not in the field for which I earned my degrees. In short, although I’m a pretty good speaker and I think I have gained some valuable insights from my experiences this year, I have absolutely no qualifications to make a presentation.

I was even more troubled when the conference schedule was sent to me. It offers ten sessions per hour for three days. Just for kicks, I asked the conference coordinator how many people are expected to attend. “Between 200 and 300,” she responded. You do the math: just about every attendee is a presenter! Who knows whether any of them have anything valuable or cogent to say to me? How should I choose which of the ten sessions per hour to attend?

Titles might be helpful, right? So here are some of the offerings during the first couple of hours:

A Self Sustaining Village. A Village of Volunteers. Bringing Online Students into the Village. It Takes a Village to Raise a Budget. It Takes a Village to S-T-R-E-T-C-H a Budget. Developing a Drop In Village. Let the Editorial Village Help you Decide. It Takes a Village: REACH . . . Building a Village to Market Learning Services. Our Students are a Village. And here’s a little twist: Build it and They Will Come. Stream it and They Will Come.

Sheesh!

These faceless “colleagues “of mine seem not to have a creative thought in their brains. This tired old metaphor they’ve trotted out harks back to the wife of a president from three administrations ago! It’s nearly 20 years old! And these folks are supposed to direct me into the future of education?

Sigh. What a waste of time and travel money. I’ll bet most of it is funded by Title V grants. Don’t even get me started on that.

I sent my regrets.




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Vast New Possibilities for Government Control of Our Lives

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Now that we know that the key for politicians to make unconstitutional demands on us is simply to levy a tax on those of us who are recalcitrant, vast new possibilities open up for people who are certain they know better than we do how to run our lives.

For instance, Michelle Obama can begin promoting a Healthy Eating Act, whereby we will all be forced to buy a requisite amount of veggies each week, including my unfavorite, broccoli. I suppose if the fine, er, tax, is not too onerous, I will find that paying the tax is still preferable to filling my garbage bin with things I can't tolerate.

And while the liberals among us are wetting their pants in anticipation of getting to impose those and similar rules, I will be proposing the Affordable Police Protection Act to my representative and senators. It will require every head of household to buy a personal defense handgun and maintain it in an easily accessible place in the home, thus warding off various criminals and reducing the costs of police forces and criminal courts. Or maybe it could be made even stronger and require every adult citizen to carry a handgun at all times, thus reducing crime even more.

Either way, people who absolutely refuse to do their part in the anti-crime and cost-of-policing-reduction effort will be required to pay a tax to offset the costs of dealing with criminal types who continue to operate, hoping to take their own chances with such scofflaws. Of course, the police can spend some time checking random citizens to verify that they are carrying their weapons and weapons permits at all times. Oh, I suppose that proof of purchase might be filed with our 1040s each year, but still there would have to be some way to verify continued ownership. Which should take precedence, though, the Fourth Amendment or the power of Congress to tax?




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The Second Hander

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In my last article on the legal challenge to Obamacare I expressed optimism that Obamacare would be struck down. However, in an earlier Liberty article I had said it had only a 1% chance of being overturned. As it turns out, Obamacare was upheld, in a 5–4 decision that is a devastating loss for libertarians and the death of hope for saving the US healthcare industry from a slow decline into socialized medicine.

What happened? In my last essay I said that Justice Kennedy was the swing vote, and he was expected to vote against Obamacare. And that's what he did. With his vote we should have won. But he was not, in fact, the swing vote. Chief Justice John Roberts, whom George W. Bush appointed to be a conservative bulwark, turned traitor and voted with the court’s liberals. Why?

When I was in law school the chief justice was still newly appointed, but he had already gained notoriety as a person deeply concerned with how the public viewed “the Roberts Court” (Supreme Court eras are often named after the chief justice who presides over them — the Rehnquist Court, the Warren Court). Roberts has proven himself a conservative in other opinions. He is reported to be a brilliant man, and surely knew what was at stake in the Obamacare case. But it appears he was so deeply worried that the public, influenced by both the Citizens United and the Obamacare decisions, would perceive the Roberts Court as an extremist ultra-Right court that he cared more about what other people thought of him than he did about his own ethical convictions. Judges do not face reelection, but the famous ones often care deeply about how history will view them. To simplify things, he was too embarrassed to be a principled conservative.

In that sense I liken him to Peter Keating, the “second hander” in Ayn Rand’s novel The Fountainhead. Peter Keating has no conviction or integrity, but “selflessly” lets other people create and define the goals and aspirations that he then pursues with ruthless ambition. Chief Justice Roberts has no internal principles, but simply goes with the public sentiment, or what he perceives to be other people’s perceptions of his court. The Supreme Court was designed by America’s founders to be a check on the actions of Congress in order to protect the American people from unconstitutional laws. The Court has failed, and the commerce clause has now lost all meaning. But the origin of this crisis lies with human psychology, not legal doctrines.




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Still Entertaining, After All These Years

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What is with all these superhero movies? Iron Man. The Hulk. Captain America. Thor. Do we really need yet another version of Spider-Man? Okay. We get it. Peter Parker gets bitten by an enhanced spider while visiting a science lab. His uncle is killed by a criminal whom Spidey could have stopped if he hadn’t been self-absorbed. He's misunderstood and mistreated. He gets the idea for his costume from a wrestling match. And he can't have a girlfriend because he has to save the world. The story has become so familiar, it isn't even Amazing anymore. So why do we have a new Spider-Man every other year?

The cynical answer is that superheroes are box-office gold. But I think there is more to the superhero craze than simple economics. Every culture has its myths &‐ larger-than-life stories that reveal the community's values, hopes, and fears. Superheroes are the American equivalent of the Olympian gods. Like the Olympians, they have human desires and human foibles. They can be lusty, angry, vengeful, and capricious. But today's superheroes are quite different from the gods of old. They no longer want to be worshipped. In many respects, they just want to be left alone.

Much can be revealed about our evolving culture by examining the evolving superhero. The latest version of The Amazing Spider-Man is quite good. The special effects of Spidey flying through the sky, somersaulting onto ceilings, and hanging from buildings are — OK, you knew it was coming — amazing. His arch nemesis, a lizard-man mutant, is well-developed and complex. The story is satisfying, amusing, and tense, especially in 3D. The casting is superb, especially Andrew Garfield as the new Peter Parker. His gangly youthfulness and spindly physique evoke the angular appendages and lightning speed of a spider. He’s cute, but somehow creepy and unpredictable too.

Even more interesting, however, are the metaphoric and mythic underpinnings of the new story. In many ways the superhero is a metaphor for adolescence. It's no coincidence that Peter is experiencing his first romance at the same time that his body is developing new powers and abilities. He is literally growing new organs, with goo that shoots out of his hands unexpectedly when he gets excited. Like many teens, he doesn't know his own strength, slamming doors and breaking handles with his new muscles. Moreover, he is self-absorbed and self-interested, experiencing pure joy in his own new powers. Superheroes of the previous century had an innate, almost Christlike sense of mission and nobility, but today's young superheroes revel in their newfound abilities. Like the teen mutants in February's Chronicle, Peter reacts joyously as he combines strength, speed, and gymnastic agility to fly from the rafters and swing from the buildings.

Myths always include a conflict between good and evil. A close look at mythic heroes and villains will therefore reveal much about the cultural fears and character values of a generation. In the original comic, Peter is bitten by a spider that has been exposed to radioactive particles. Like other mid-century science fictions, Spider-Man embodied a generation’s fear of the atomic bomb and radiation. In the 2012 version, the laboratory is studying interspecies genetic engineering, revealing a new generation’s fears and concerns about unintentional consequences to genetic meddling.

Another mythological mainstay is the quest for self-discovery. A moment of such discovery occurs directly as Peter enters his English class. His teacher tells her students, “A professor once told that there are only ten stories in all of fiction. I contend that there is only one: ‘Who am I?’” She may be wrong about the number of storylines, but she is certainly right about the importance of self-discovery in literature. It reaches all the way back to 500 BC, and Sophocles’ foundational play, Oedipus Rex. Oedipus discovers who he is by discovering who his parents were. The current story also starts as a quest for self-discovery, as Peter sets out to uncover secrets about his father.

When Peter settles down to thwarting criminals, his motives are far from altruistic. He is no Superman, fighting for “truth, justice, and the American way.” He just wants to find the man who killed Uncle Ben, and if he ties up a few other criminals along the way and leaves them for the cops to arrest, so much the better. Eventually, however, he accepts his mission to fight crime and protect his community. Could we really expect to see a superhero who is not expected to “give back”? As a voice from the dead, Uncle Ben tells Peter that when you are given a great talent, you have to share it with the world.

But this time he doesn’t have to do things all alone. Most revealing is director Marc Webb's treatment of the community at large — the people of New York whom Spider-man is trying to protect. Unlike the inhabitants of Superman's Metropolis or Batman's Gotham or the Avengers' Manhattan, they don't stand around looking up and pointing while the superhero does all the work. They get involved, helping Spidey help them. I love this newfound push toward self-reliance, even if it is a self-reliance that “takes a village.” (How I hate that metaphor!)

Over all, Webb has created a satisfying new version of this cinematic mainstay. I still don’t know why we needed a new one, but it held my attention, even though I know the story inside and out. Myth has a way of doing that.


Editor's Note: Review of "The Amazing Spider-Man," directed by Marc Webb. Columbia Studios, 2012, 136 minutes.



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Nanny Tries to Resurrect Pappy

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This recent story has gone virtually unnoticed. It is a report that the federal government — yes, our very own nanny-state — has funded anew one of its many websites: www.fatherhood.gov. The site is devoted to teaching American men and — let’s not be sexist! — American women how to be good fathers.

The site gives just tons of terrific tips about being a good dad, such as: it is the father’s job to provide healthy meals for his kids, and actually to eat meals with them. (This is a revelation: I thought that since the government is advertising to get people to apply for food stamps, the rolls for which have swollen to an all-time high of 47 million, it is in fact the government’s job to feed the kids.) And there is other vital information, available nowhere else. There is a video about how to wash your hands, with narration that instructs: “Wet hands under running water, add soap, and rub all parts of the hands and fingers for 15 seconds.”

The things you can learn from government! I never knew you had to use soap!

The site offers some even more desperately needed videos on reading, “constructive play,” and — most amazing — brushing your teeth.

There is a richly layered irony in this. Begin with the fact that the website was funded most recently by the 2005 Deficit Reduction Act. The idea that deficit reduction is advanced by funding completely superfluous government websites is self-evidently ridiculous.

Now add the bigger point. Here we are, nearly 30 years after the publication of Charles Murray’s Losing Ground, the definitive analysis of the massive destruction brought to the American family (and society) by the benighted changes to the welfare programs in the early 1960s. The new form of welfare basically paid young girls to make horribly bad life choices, mainly to have children too young and out of wedlock. The illegitimacy rate in the inner city spiraled out of sight, hitting 25% by the mid-1960s (when Daniel Patrick Moynihan wrote his famous report on the black family crisis). In the inner city, the first of the month was dubbed “Father’s Day,” in grimly humorous recognition of the fact that the only “father” in these broken welfare families was Uncle Sam.

Over the decades since, the welfare state’s iatrogenic pathology has spread from the inner city to mainstream America. Now over 70% of all black children, 50% of Hispanic children, and 25% of non-Hispanic white children are born out of wedlock. The rate of illegitimacy for all American births is currently 41%, and for American women under 30, it is a stunning 53%.

So the richest irony of all is that the nanny state that did so much to eliminate fatherhood is now trying to train men to be fathers.

In fine, now that nanny has choked pappy to death, she is trying to resurrect him.




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Prometheus Redux

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Prometheus is the most libertarian of the Greek gods. His name has been used to signify choice and accountability in such stories as Mary Shelley’s Frankenstein or, The Modern Prometheus; her husband Percy Bysshe Shelley’s Prometheus Unbound; Ayn Rand’s Anthem, in which the protagonist renames himself Prometheus; and even in this publication, whose web address, libertyunbound, alludes to the Greek myth.

In that story, Prometheus and his brother Epimetheus, both Titans, are given the task of creating man and endowing him with gifts. The animals are created first, and Epimetheus is a bit too generous, bestowing all the talents and skills (courage to the lion, strength to the ox, cunning to the fox, sagacity to the owl) before man comes along. What to do about this blunder? With the aid of Athena, Prometheus flies up to the sun and steals a bit of fire, bringing it back as a gift to man.

This gift would truly set humans apart from the rest of the animal kingdom. With fire they could warm their houses, cook their food, forge tools to cultivate the earth, create art and musical instruments, and coin money to make commerce and wealth possible. They could also make weapons of defense. In short, they could become independent and self-reliant. But eventually those weapons of defense would become weapons of war, bringing such wickedness to the earth that Zeus would be compelled to destroy it with a flood and start all over again with a new founding family.

Zeus and the other gods, whose power comes from the adulation of humans, are not happy. As a punishment, the gods do two things. First, they form a woman named Pandora and give her to Epimetheus, along with a box from which Pandora releases sorrows and misfortunes into the world, misfortunes that will cause humans to turn to the gods for help. Second, Zeus has Prometheus chained to a rock, where an eagle comes each day to eat his liver. The liver grows back overnight, only to be eaten again.

His body changes — veins appear in his skin — he seems to become mortal — then he crumbles and falls, as his DNA spills like atoms into the water.

It is helpful, though not entirely necessary, to know this background when seeing Prometheus, the long anticipated prequel to the Alien (1979) / Aliens (1986) / Alien3 (1992) / Alien Resurrection (1997) tetralogy. Those films put Sigourney Weaver on the map as one tough mama and opened the casting door to women to become Hollywood action heroes. While the film does not adhere slavishly to the myth, there are enough allusions to make it satisfying intellectually even though it is mostly a science fiction thriller.

As Prometheus opens, the camera pans along what appears to be primordial Earth: uncultivated shrubbery emerges from rich, black, volcanic rock as water pours through fissures in canyon walls. The camera pans up to a gigantic waterfall that seems to be the source of life itself. (Iceland, I must say, provides the perfect location for a pre-human Eden!) At the top of the falls sits a man-like being. In his hand he holds a black and red substance. He hesitates with what appears to be a look of sorrow, and then he eats the substance. His body changes — veins appear in his skin — he seems to become mortal — then he crumbles and falls, as his DNA spills like atoms into the water. Watching this, I couldn’t help but think of Persephone banished to Hades for eating the forbidden pomegranate seed, Adam becoming mortal in the day he ate the fruit of the tree of knowledge, and Prometheus suffering eternal punishment for bringing life-giving fire to mankind. “Adam fell, that men might be” (2 Nephi 2:25), I thought, as the being fell, literally, into the waterfall. Powerful.

The rest of the film is a satisfying return to the Alien franchise, with all the expected elements. Aliens burst from stomachs (note the allusion to liver-eating here). Wise-cracking rocket drivers crack their last laugh. Space scientists hide from monsters in darkened shafts. And one strong, independent woman does her best to save the day. This time, archeologists Elizabeth Shaw and Charlie Holloway (Noomi Rapace, Logan Marshall) have discovered evidence of the origin of earth life — and it isn’t evolutionary amoebas. They believe they can trace the path of that original goo-eating Earth visitor back to his planet of origin, and there discover important truths about humankind.

What they find relates to the second part of the Prometheus myth — Zeus’s decision to destroy Earth’s warmongering civilization. The space travelers discover that aliens have been stockpiling gallons of the goo as a weapon of epic destruction, and their navigation system is targeting Earth. They have simply been waiting for humans to become smart enough to reach the founder gods, Prometheus style, and bingo — liftoff. Once again, Earth’s safety lies in the hands of a feisty, self-reliant, courageous, and in this case quasi-religious woman — Elizabeth is a crucifix-wearing Catholic who isn’t quite sure what that means.

Even with a slew of stomach-ripping aliens on hand, no modern blockbuster would be complete without a cold, heartless, corporate rep. Prometheus supplies two of them, in the guise of Meredith Vickers (Charlize Theron) and her boss, Peter Weyland (Guy Pearce), who is funding this mission not for its potential contribution to science or humankind, but for selfish personal reasons. Of course. (Interestingly, Weyland’s company logo is a triangle, perhaps suggesting the Trinity. That would go along with Elizabeth’s crucifix.) Unfortunately, the always wonderful Guy Pearce is wasted here under a gallon of age-creating prosthetics; if they wanted an old man in his role, why not simply hire an old man to play it? Unless flashbacks have been planned for the next installment of this prequel, there was absolutely no reason for this casting. As for Theron — she plays the cool queen magnificently.

The true stars of this film are Michael Fassbender as David, the lifelike robot servant of the crew, whose name suggests that either a Goliath slayer or a Messianic king (or both) is coming somewhere along the way of this new trilogy; and Rapace, who steps into Sigourney Weaver’s moonboots with a fierce determination and a welcome softness. She will do well as the new Eve, if that is where this trilogy is headed.


Editor's Note: Review of "Prometheus," directed by Ridley Scott. Twentieth Century Fox, 2012, 124 minutes.



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Taxes on Buying and Not-Buying

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In his decision on the healthcare law, Chief Justice Roberts interprets the "penalty" on not buying health insurance as a tax. He recognizes that it is meant "to affect individual conduct." But such taxes, for example import duties, are nothing new. As Roberts says (pp. 36–37 of the decision), "Today, federal and state taxes can compose more than half the retail price of cigarettes, not just to raise money, but to encourage people to quit smoking. And we have upheld such obviously regulatory measures as taxes on selling marijuana and sawed-off shotguns."

But the import, cigarette, marijuana, and shotgun examples are taxes on selling and buying something. The penalty regarding health insurance is a tax on not buying something. Does Roberts really mean to constitutionalize a tax on not buying whatever Congress may specify? What has become of constitutional limits to federal power?




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Check Your Premises!

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Ah, NPR — how we love to hate you . . . and guardedly to love you. Love you for such gems as “Car Talk," “A Prairie Home Companion,” and “Freakonomics.” Hate you for the smug sanctimoniousness that passes for “objective” reporting, riddled with questionable premises axiomatically postulated.

It’s not that interviews with the likes of David Axelrod or public sector union bosses are slanted — after all, we expect left-wing boilerplate from them. It’s the public affairs programs, such as “Talk of the Nation” and the “Diane Rehm Show,” which, while pretending to be objective, are blinded by their own unquestioned assumptions. This is particularly evident when the host — be it Rehm or Neal Conan — in an effort to be balanced during roundtable discussions with a potpourri of commentators, plays devil’s advocate. The questions of these devil’s advocates often lack conviction or show a gross misunderstanding of the opposing viewpoint. And they are seldom followed up — after what are invariably short, pro-forma answers.

On Fridays, Rehm hosts a roundup discussion of the week’s news. Recently, the subject was the presidential campaign. At one point she asked the panel whether Mitt Romney’s record at Bain Capital was “fair game” — for an attack by the opposition, I suppose. Instantly, my BS radar quivered, since it’s a given that a candidate’s record should be analyzed and critiqued. The question turned out to be the opening salvo for a nitpicking attack on Romney’s Bain record, private equity in general, obscene profits, and “excessive” wealth. There was no parallel inquiry into whether Barack Obama’s record as a community organizer was “fair game.”

Examine the hidden premises.

In the first instance, the assumption is that work in venture capital and leveraged debt — making a profit by dismembering noncompetitive industries, extracting their residual value, and eliminating the jobs they provide — is problematic, perhaps nefarious. Never mind that failing companies might be better off dissolved, and their assets better employed in a different sector of the economy. Never mind that the benefits to the economy would likely increase employment by making business in a given sector more competitive, despite the short-term loss of jobs. To see this in another way: why should productive capital be wasted subsidizing a dying enterprise producing unwanted goods by overpaid workers at uncompetitive prices?

Although the companies that Bain Capital nurtured back to health and profitability — because, in the judgment of the investors, they showed promise — were dutifully mentioned, the focus of the discussion remained on the euthanatized companies and their lost jobs. Eager to administer the coup de grace, the commentators piled on “excessive” profits and wealth, ignoring whether or not these were acquired honestly through hard work and brains.

Why should productive capital be wasted subsidizing a dying enterprise producing unwanted goods by overpaid workers at uncompetitive prices?

In the second instance — the unasked question (and probably why it wasn’t asked) — the assumption is that work as a community organizer is always noble and beyond criticism. Perhaps it is, but does it qualify a candidate for the presidency, where judgment, leadership and knowledge are paramount?

Mitt Romney’s record — whatever you might think of his policies — at Bain & Company, Bain Capital, and the Salt Lake Winter Olympic games, as well as in the governorship of Massachusetts, demonstrates the sort of judgment, leadership, and knowledge that one expects from a first-class commander-in-chief. In contrast, Barack Obama showed a striking lack of judgment and a foolish naiveté when he promised to close the Guantanamo prison, to have the most open and accessible administration to date, and to do a lot of other things that he has not done, three and a half years into his presidency. The May 26 issue of The Economist displayed its inimitable sense of humor and irony when it reported that

“Barack Obama accepted an award honouring his administration’s commitment to transparency on March 28th 2011. It was given by a coalition of open-government advocates. But the meeting was closed to reporters and photographers, and was not announced on the president’s public schedule. Occasionally life provides perfect metaphors.”

The article then very seriously ups the ante:

“Yet perhaps none of Mr Obama’s transparency promises has rung hollower than his vow to protect whistleblowers. Thomas Drake, who worked at the National Security Agency, was threatened with life imprisonment for leaking to the Baltimore Sun unclassified details of a wasteful programme that also impinged on privacy. The case against him failed — ultimately he pleaded guilty to a misdemeanour charge of ‘exceeding authorised use of a computer’ — but not before he was hounded out of his job. Mr Obama’s administration tried to prosecute him under the Espionage Act, a law passed in 1917 that prohibits people from giving information ‘with intent or reason to believe that it is to be used to the injury of the United States or to the advantage of a foreign nation’. Mr Obama has indicted six whistleblowers, including Mr Drake, under the Espionage Act, twice as many as all prior administrations combined, for leaking information not to a ‘foreign nation’ but to the press.”

Finally, to tie the ribbon properly, The Economist contrasts the Obama administration’s secrecy with the new sunshine policy of Georgia’s Republican administration, which opens vast public access to government files. All this from a newspaper that endorsed Obama over McCain in 2008.

As to leadership, President Obama abdicated any vestige of it when he ignored the balanced-budget recommendations of the bipartisan Simpson-Bowles commission and subsequent Super Committee — both of which he had commissioned. And he left the design of health reform in the capable hands of Harry Reid and Nancy Pelosi.

Obama’s knowledge of community organization might be beyond question, but if his role as a teacher of constitutional law at the University of Chicago meant anything, warning bells ought to have chimed in his head as he signed into law the Patient Protection and Affordable Care Act, otherwise known as Obamacare — as became evident to constitutionalists on June 28 when the Supreme Court’s minority issued vigorously dissenting opinions to the majority’s ruling on its constitutionality.

His lack of economic knowledge is even more abysmal. The Diane Rehm Show referenced above was aired as a follow-up to the Democrats’ critique of Romney’s stint at Bain. TV spots, print advertisements, and an Obama address have caricatured private equity, financiers and of course the Republican candidate as “vampires” and “vultures.” A conflict between profits and unemployment was insinuated. Referring to these attacks, The Economist agreed with Romney’s oft-stated comment that Obama has no idea how the economy works or how jobs are created, and in its June 2 issue opined, “Mr Obama is guilty not of rhetorical excess but of economic muddle. That is far more worrying.”

But back to NPR.

The then soon-to-be-expected Supreme Court ruling on the legality of Obamacare supplied the theme for another recent Diane Rehm roundtable discussion. To the NPR powers-that-be, the constitutionality of the law must have seemed indefensible. So once again, they changed the premise and reframed the debate to stack the deck in their favor. Instead of focusing on the substance of the upcoming decision, discussion focused on the haplessness of five to four decisions and the desirability of broader consensus among the justices. This was chewing on the sizzle instead of the steak. Ironically, even though Obamacare was upheld, it was still a five to four decision.

Conan asked his audience whether NPR offered good value to its listeners, thereby subtly shifting the premise of the argument and justifying the subsidy. He received nothing but paeans of praise for NPR — from its own listeners, of course!

On June 15 President Obama displayed a presidential quality that is anathema to lovers of liberty: a lust for power. Bypassing Congress, he ordered the Department of Justice not to enforce certain measures of immigration law, in effect passing the so-called DREAM act by executive order. On the day it happened, Diane Rehm’s Friday roundtable discussion focused on the decree’s compassion, on Congress’s ineffectiveness, on the Republicans' immigration policy muddle, and on the consequences of the president’s move on the political campaign — in particular, how it stole the thunder of Florida Republican Congressman Marco Rubio, a Cuban-American vice-presidential hopeful whose modified DREAM act had a good chance of being enacted, in a conventional manner. In short, she focused on everything except the executive order’s legality.

A Fox News discussion, on the other hand — and virtually at the same time — questioned the constitutionality of the president’s decree, almost to the exclusion of every other aspect.

On another show, NPR itself was the subject du jour. Whenever the nation’s budget is up for discussion, NPR’s subsidy — relatively small as it is — becomes a point of contention for some Republicans. But the animosity conservatives harbor towards public radio for their leftward slant is almost beside the point. Their more basic concerns are twofold: is the subsidy a proper function of government; and can we afford it?

Those questions are about fundamental premises. Yet they were completely ignored when Neal Conan tackled the subject on NPR’s “Talk of the Nation.” Conan’s show is sometimes a Gatling gun of vox populi sound bites on whatever the current concern happens to be. During these broadcasts he poses a provocative question and solicits callers for their opinions, granting each of them only a few seconds, and seldom engaging them or directly commenting on what they say. On that day Conan asked his audience whether NPR offered good value to its listeners, thereby subtly shifting the premise of the argument and justifying the subsidy. He received nothing but paeans of praise for NPR — from its own listeners, of course!

Premises are not confined to words. Tone can convey its own hidden premises, and Conan is a master of the craft. Merely by the length of his silence and the inflection on the few words he uses to break it following a caller’s comment he can indicate his approval, disapproval or neutrality. The last is the quality he always strives to project, but the careful listener can often almost hear him muffling a censorious tut-tut-tut.

He doesn’t hold a candle, however, to the archly supercilious Nina Totenberg, NPR’s legal affairs correspondent. It’s never difficult to determine Totenberg’s likes and dislikes, which — you can be certain — are always evident, especially when combined with her East Coast Brahmin accent, which lends a certain emphasis to her tone. She can infuse with utter contempt the utterance of a name or story she disapproves; and she can manage to give weight and portent to anything she considers noteworthy, no matter how trivial or anodyne, by the intonation of her voice.

* * *

Writing is seldom objective; reportage never is. Putting an idea into prose requires choosing words to convey the thought, while even selecting what constitutes a news story, deciding how to report it, or how much context to include, invariably slants it.

This seems such a simple observation. Yet most news organizations are loath to recognize or admit it, and don a mask of faux objectivity that few people see through. With one exception: the aforementionedEconomist.

The Economist is an English weekly news magazine in continuous publication since 1843, with a circulation of 1.5 million. Itcalls itself a “liberal newspaper”, but it is not “liberal” in the American sense. Rather, it is “classical liberal”, sometimes advocating radical libertarian positions. Its June 11 issue carried a critique of charitable tax breaks as a cover story. It advocates the legalization of drugs and open immigration, has criticized the “corporate social responsibility” movement from an ethical perspective, and has strongly defended securities short selling and naked speculation as beneficial practices.

Ironically, the journal’s editorial stance results in much more objective reporting than that of an “objective” source such as NPR — for one thing, because a reader knows up front where The Economist is coming from. Contrast with The New York Times (the “newspaper of record”), with a print circulation of 1 million. The NYT has always considered itself the epitome of objectivity, yet a large majority or readers view it as “liberal” (in the American sense). This view was confirmed in a mid-2004 editorial by the then-public editor, Daniel Okrent, in which he admitted that the newspaper did have a liberal bias. But this bias is not the paper’s stated policy position. Both the NYT and NPR would benefit hugely from such a disclosure, as they would no longer draw accusations of hypocrisy. But don’t hold your breath.

One unexpected bonus from The Economist’s openly classical liberal bias is that they can use humor to drive the point of a story home. Reporting on Zimbabwe’s upcoming elections under President Robert Mugabe’s tyrannically corrupt administration, The Economist offered a photograph of an elderly, loincloth-clad shepherd leaning on his crook, next to a coffin under a tree; nearby, a cow grazed. The caption read: “Four votes for Mr Mugabe.”




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