A Prayer for the Council of Economic Advisors

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Have you ever said a prayer for the President’s Council of Economic Advisors (CEA)?

Neither have I.

It seems an odd thing to do, doesn’t it? To nonbelievers, it would, of course, be a pointless act, and while it would not necessarily be pointless to believers, surely even they would see it as presumptuous.

In any case, people do say prayers for their leaders, particularly in times of strife; and since we may be entering such a time, I have selected a prayer for the CEA just in case I ever feel the urge to use it.

It is a simple prayer, taken from the King James Bible, Luke 23:34: “Father, forgive them; for they know not what they do.”

 




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Legacies

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Looking down the vista of time I see an epoch in our nation's history, not in my time or yours, but in the not distant future, when there shall be in the United States but one people, molded by the same culture, swayed by the same patriotic ideals, holding their citizenship in such high esteem that for another to share it is of itself to entitle him to fraternal regard; when men will be esteemed and honored for their character and talents.

The sentiment expressed in these words may sound familiar, especially considering that the monument to Martin Luther King was dedicated just last week. You might think that these words are from an early draft of Martin Luther King, Jr.'s famous "I have a dream" speech. It would be a good guess, but it would be wrong. The words above were written by Charles Waddell Chesnutt in 1905, more than half a century before Dr. King uttered his poetic and powerful prose on the steps of the Lincoln Memorial, August 28, 1963:

I have a dream that one day on the red hills of Georgia the sons of former slaves and the sons of former slave owners will be able to sit down together at the table of brotherhood.

I have a dream that one day even the state of Mississippi, a state sweltering with the heat of injustice, sweltering with the heat of oppression, will be transformed into an oasis of freedom and justice.

I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.

Born in 1858, Charles W. Chesnutt witnessed the Civil War and lived through the reconstruction and racism that followed it. Both his parents were considered black, although both had some white ancestors. Photographs of Chesnutt reveal that he could easily have passed for white, as many mixed-race people did in those days. Chesnutt chose not to pass into that easier world. Instead, he embraced his black roots and wrote short stories about the complex issues of racial relationships. He was well respected in the literary community, writing for the Atlantic Monthly and other mainstream publications. He was even invited to attend Mark Twain's posh 70th birthday party.

Nevertheless, Chesnutt's political sensibilities ran deep. He was an early civil rights activist and a founding member of the NAACP. The words quoted above are taken from an essay he wrote for the NAACP's literary magazine, The Crisis, entitled "Race Prejudice, Its Causes and Its Cure."

Like the man who would follow in his footsteps, Chesnutt did not believe in violent reprisals for the wrongs committed against African-Americans. He wanted fair treatment, but without retaliation or reverse bigotry. Chesnutt and King both longed for a day when color simply would not matter. In that 1905 essay, Chesnutt continued:

[I see an epoch] when hand in hand and heart with heart all the people of this nation will join to preserve to all and to each of them for all future time that ideal of human liberty which the fathers of the republic set out in the Declaration of Independence, which declared that “all men are created equal.”

Similarly, King's 1963 speech proclaimed: "I have a dream that one day this nation will rise up and live out the true meaning of its creed: 'We hold these truths to be self-evident: that all men are created equal.'"

Interestingly, King's heirs sued CBS for copyright infringement after CBS aired a segment of the speech as part of a documentary on the civil rights movement. They claimed that the speech was a performance and thus was protected by “common law copyright,” even though King did not register the speech in advance with the Registrar of Copyrights. In 1999 the court ruled in the estate's favor, giving King's family the right to license the speech and receive royalties whenever it is copied, aired, published, or performed. Now if the speech is printed in a textbook or quoted on Martin Luther King’s birthday, for example, his heirs will earn a royalty. It’s a little like singing “Happy Birthday”… even though it seems to be in the public domain, it isn’t. This copyright will remain in force until 70 years after King's death (2038).

I am happy for King's heirs, especially in light of the monument that was recently unveiled near the steps where he delivered his famous speech. I applaud the distance we have come toward seeing his dream become a reality, as well as toward seeing Chesnutt's “vista” move into the foreground. Sadly, however, to my knowledge none of King’s heirs has ever acknowledged or credited the article that Charles Chesnutt published in The Crisis all those years ago, even though its influence on the "I have a dream" speech can hardly be disputed. Let’s acknowledge the contributions of both these great civil rights leaders.




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The Return of Coxey’s Army

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In 1894, Coxey’s Army, a legion of purportedly needy people, came to Washington to demand radical reform of the capitalist system. It was supposed to be a “march,” but some of Coxey’s soldiers tried to make their trip to the capital by hijacking railroad trains. The depredations of the Army were widely feared, especially by communities that lay on its route, but by the time it reached Washington its numbers had dwindled. It ended when its leaders were arrested for walking on the capitol grass. That took care of Coxey’s Army.

During the past few weeks, downtowns across the country have been the unwilling hosts of tribes of ignorant savages shouting about the wickedness of, guess what, the capitalist system.  They maintain that they represent the 99% of Americans whose lives are controlled by the remaining 1%, who supposedly own 99% of property in this country. Ironies abound: people who have nothing better to do than hang out in a park and empty their bladders in a McDonalds restroom are lauded and supported by labor unions; people who want to abolish wealth are bankrolled by “liberal” billionaires; and people who never vote are courted by the highest official representatives of the Democratic Party. Friendly media note with relief that the Occupy mobs are (usually) “peaceful.” I suppose that if you come over to my condo complex, pitch a tent, and refuse to leave, denouncing me day and night and threatening my neighbors with the risk of epidemic disease, you are being “peaceful.”

It’s a safe bet that not one Occupier, or mainstream commentator on the Occupiers, has ever heard of Coxey’s Army. So such people haven’t fully realized what the lowest level of police power can do to wipe up a “movement.” On October 13, all around the country, local mayors and cops started moving against the demonstrators, evicting them from their zones of occupation for reasons of health. Their tent cities were fouling the environment.

Of course, that’s another irony that should be savored.  One of the Occupiers’ great complaints is that capitalism is ruining the environment. Well, just look at what the Occupiers did to New York’s Zuccotti Park (which by the way is privately owned, despite Mayor Bloomberg’s apparent assumption that he owns it and can let protestors in and out whenever he wants). It’s hard to imagine a more degraded environment.  For this reason, the protestors were nearly kicked out of the park on October 14, a mere four weeks after they started to degrade it. On that day and the day after, they were kicked out of parks and other civic spaces in many other cities. On October 16, they were prevented from starting a camp in Chicago’s Grant Park.

A few more run-ins with local government, and the movement will probably go the way of Coxey and Friends. This is yet another irony, because what the protestors, “anarchist” or not, are really screaming for is more government, government that will run everyone’s life in the minutest detail. That’s the only way in which their multitudinous demands — for equal incomes, free money, vast solar energy projects, whatever — could ever be satisfied.

But there’s one nice, nonironic touch.  For once, one of the Occupiers said something correct. According to a CNN report on October 13, Occupy Wall Street spokesman Tyler Combelic promised resistance to any attempt to move the protest out of its usurped location, observing. "It's not an occupation if you can't occupy the park."  How true, how true.




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It’s Not Even Keynesian

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In a Facebook discussion of tax policy, I came up with an idea. It seems obvious, and on reflection also useful.

There are three basic categories of government taxing and spending:

One — tax to spend on government services;

Two — tax to redistribute wealth;

Three — tax to spend on stimulating economic activity.

The debate about one is always just a debate about which government services are necessary and desirable. The debate about two is very complex and can be approached from many angles, but it helps the analysis to state clearly when you are talking about redistribution.

The debate about three, when brought into clear focus, has a clear answer. Raising taxes (in current government jargon "paying") for "stimulus" is a certain mistake. It does not even have the theoretical support of the most rabid Keynesian theory.

Keynesian theory favors fiscal stimulus (that is, deficit spending) in times of high unemployment and recession. This can be achieved by lowering taxes while keeping expenditures stable or by raising expenditures while keeping taxes stable. The Keynesian hope was to put an end to the business cycle.

President Obama has lately made a stupid proposal. He wants to be seen as doing something about poor economic conditions. He recognizes that the idea of more deficit spending is very unpopular. So he proposes a false stimulus. It would be paid for by higher taxes on the rich. Grabbing more money and spending it (as opposed to deficit spending) may provide government services and may redistribute wealth, but it cannot provide a Keynesian stimulus. When it is considered as a "stimulus" proposal, the only theoretical argument in favor of it is a purely communist one — the planners will better allocate the money than would private enterprise. That's a bankrupt, and also an unpopular theory, and I don't think Obama or his advisors like it.

I think they like taking and spending (for purposes of redistribution and abuse of power — tossing billion-dollar favors around for one's personal benefit) and appearing (for political purposes) to be doing something. So they have dressed up a policy that would increase corrupt central planning while dressing it in the clothes of "economic stimulus."




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Stop the Slander of Inner-City Parents

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A few years ago I wrote an article for this journal urging school choice. Afterward, I received a number of arguments against it — bad arguments. One of these was what I termed the “incompetent parent argument,” which is the one you often hear from the defenders of the present public school system (that is, from greedy rentseekers who benefit from the system, because they are employed by it). The argument is this: school choice will fail because inner-city parents are too ignorant and indifferent to make wise choices about their kids’ education.

This claim is usually proffered sotto voce, since inner-city parents are often members of ethnic minorities. The argument can be accused of having a racist cast, yet the people who offer it are typically politically correct progressive liberals who love accusing the rest of us of racial insensitivity.

But to return to the argument itself. A recent piece in the Wall Street Journal exhibits the ultimate refutation of this rubbish. It reports the dramatic swelling of a “crime wave” of inner-city parents who lie about their home address on school applications. Gov. John Kasich (R-OH) recently had to grant clemency to a poor black mother who had dared — dared!! — to use her father’s home address to get her two daughters into a decent school.

For this act of vicious criminality, she was charged with grand theft. After being incarcerated for nine days, she was convicted on two felony counts. If they had remained on her record they would have ruined her chances of getting a teacher’s certificate and becoming a teacher herself.

The lady is not alone. Not hardly. In several states, desperate parents — you know, the inferior inner-city parents who are genetically incapable of the same love for their children that tenured white teachers can feel — have been arrested for trying to do what she did, and are facing jail time or other punishment. School districts around the country are hiring detectives to follow children and see whether they really live where they say they do. Some districts are even using “address-verification” programs to halt the abominable crime of finding a decent education for your kids. One of these programs, VerifyResidence.com, uses “covert video technology” to find the pernicious perps.

Minority parents must care a lot about choosing good schools for their kids, if so many are risking prison for the chance to do so. And of course, these people are hardly criminals. As the article suggests, we can view them as practicing a form of nonviolent protest to achieve their civil rights, in the honorable tradition of Martin Luther King.

A couple of months ago, more evidence that parents are not indifferent but are in fact committed to finding good schools came to light. It was an internal teachers’ union PowerPoint presentation boasting about how the union (the notorious American Federation of Teachers) thwarted parents’ groups in Connecticut from passing a “parent-trigger law” that would have forced a change in administration of any failing school if the majority of the district’s parents voted for the change. If the parents had been as indifferent as rumored, would the union have gone to such Machiavellian means to screw them?




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True Community

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When Americans think of “community,” they imagine warm and snuggly things. The word conjures a host of wholesome associations. It reminds us of neighbors sharing loaves of home-baked bread, of children playing in a safe backyard, of grownups meeting face to face to solve problems with good, old-fashioned common sense. The term sounds very Currier and Ives. Until we step back and take a good, hard look at those who use it.

These days, it’s thrown around by people who seem uninterested in grownups solving their own problems. A more honest term for how we’re seen would probably be “herd.” It seems calculated to keep us bunched together too closely to remember that we are individuals. It’s the way our teachers used to speak to us in the third grade. If you put Currier and Ives into a blender with Lyndon B. Johnson and Mister Rogers, this is likely what you’d get.

We elected a president who touted his experience as a “community organizer.” He stands at the podium and lectures us about what’s best for us, as if we lacked the sense to figure that out for ourselves. The impression that unmistakably comes across is that he thought he was far smarter than any of those dolts in the “communities” he organized. And that as president, he is certain the voters are so stupid we don’t see that his own reelection — his glorious little career — is factored into every move he makes.

Recently, I bought a new computer. I’ve been very happy with it, because it does a lot of wonderful, whiz-bang things. But I am unfamiliar with some of its programs. I had a screenplay to write — something I hadn’t done since college — and I couldn’t figure out how to set up my document in the proper format.

I managed to figure it out by myself, except for one crucial detail. Geek Squad wouldn’t simply answer my question, but they’d access my system from headquarters and fix the problem themselves — for 60 bucks. I threw it out to some online groups, and kept getting people who would gladly give me an answer — in exchange for my credit card number. From “the community,” I must admit, I wasn’t feeling much love.

Are our government-anointed “community organizers” right? I began to wonder. Have we lost the capacity to solve even the simplest of problems without their guidance? A whole industry has arisen to do for us, for money, what we know in our guts we should be able to do for ourselves — or at least with the help of somebody who won’t charge us for it.

People resent this, but their resentment is often exploited by those who don’t believe in private industry. Devotees of the government collective cluck their tongues about the hucksters out there who’ll take our money to answer questions with which they might help us for free. But are they to blame for wanting payment because we lack the imagination to look for solutions we don’t have to pay for? If our stupidity and helplessness keeps a roof over their heads, is that their fault or ours?

Refusing to give up too easily, I went to the meeting of a group to which I belong — one of those voluntary associations we’re forever being told no longer exist. I asked my question to some friends before the meeting, and within minutes somebody provided an answer. Afterwards I went home, tried it out, and it worked. And I was not one penny poorer.

Community — the real deal — still exists. If we’re willing to trust it. What that means is that we must remember how to trust each other. The real community is us, not an organizing "leader." But we can only trust each other if we dare to trust ourselves. When we allow ourselves to be treated like sheep, we are ripe for plunder by wolves.

The best ideas still come, not from any central committee of self-appointed smarties, but from our friends, our neighbors, sometimes even our children, and ourselves. A little bit of resourcefulness, of self-reliance, of trust in the everyday folks we know, can save us a lot of cash. In the long run, it may save our freedom.

And here's an important point: those in government who claim they will solve our problems for us will not do it for free. That is always the assumption, when they insist on helping us. But it's never true. We will pay for everything we get — and often for things we don't get — in money, time, inconvenience, and anger. And it increasingly looks as if the price they’re demanding is our very souls.




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Thoughts on Crony Capitalism

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The Obama regime has become synonymous with the kind of crony capitalism that characterizes, say, Russia. Crony capitalism is a sort of faux capitalism found in a society where many citizens desire socialism but don’t want to embrace it openly, because of the disrepute into which socialism has fallen. The 20th century was the century of socialism, and it cost the lives of perhaps 150 million people and brought unrelieved poverty to the nations that succumbed to its siren call of “equality.”

Crony capitalism characterizes regimes, such as Vladimir Putin’s, that follow the collapse of overtly socialistic economic systems (which invariably die, sooner or later, whenever — as Dame Thatcher famously observed — they run out of other people’s money). It also characterizes regimes such as Obama’s that occur in countries where the elites want socialism but realize that they can’t openly sell it to the public in its naked form.

A crony capitalist regime is sustained by favorable economic feedback loops between the regime’s leaders and key, corrupt leaders in the “private” sector (such as business and labor organizations). The regime’s leaders award these favored business and labor leaders (the “cronies”) sweetheart contracts for governmental projects; arrange financing from the public purse or banks that are funded by the public but controlled by the regime; use regulatory and tax policies to reward their supporters and punish their competitors; and so on. The regime’s players are paid back by the corrupt private sector players in various ways: by cushy jobs given to the bureaucrats when they “retire” from “public service;” by favorable deals for buying homes or business franchises; by monetary bribes (campaign “contributions,” or — especially when the regime is located in a third-world cesspool, such as Uganda or Chicago — in cash). The regime thus increases its power, and is able to pay off more corrupt businesses.

It is all very convenient for the players, however inconvenient it may be for the ripped-off taxpayers and the honest businesspeople who are denied a level playing field.

The crony capitalism of the Obama regime comes in several major flavors — that is, the many industries it has corrupted or hijacked. Lately on display is its crony green capitalism. The regime has received massive financial support from various wealthy investors in so-called “green” energy technologies and from the major environmentalist groups. It has repaid them by doing its best to block domestic drilling for oil and gas, even as it pushes grotesquely inefficient wind and solar technologies. The crony green capitalism has been exposed to the light of public notice in the Solyndra case and others.

But we must not forget the regime’s crony car capitalism. It created Government Motors in a colossally corrupt bankruptcy that stiffed secured creditors and stockholders alike in favor of the UAW, a lavish supporter of the regime. This led to the waste of billions in taxpayer dollars, a huge tax preference given to GM and Chrysler to the disadvantage of Ford, the UAW being given obscenely unjust stakes in the new companies, and later to the singling out, by the regime’s secretary of transportation, of a competitor of Government Motors (Toyota) for harassment.

Crony capitalism is a sort of faux capitalism found in a society where many citizens desire socialism but don’t want to embrace it openly.

As a result, the UAW — which should have been decertified by its members for destroying the companies for which they worked — was given new life. Lately it has been portraying itself as a trustworthy companion to automakers, existing only to help improve worker morale. It has gotten some traction, amazingly, with a German automaker, Volkswagen.

The latest interesting wrinkle is that Ford felt compelled to pull a highly effective ad that implicitly criticized its American competitors for taking part in the corrupt bankruptcy deal.

Ford ran a series of ads that had actual customers telling what made them buy a Ford. What caused a flap was the testimony from a man named Chris McDaniel, who said:

I wasn’t going to buy another car that was bailed out by our government. I was going to buy from a manufacturer that’s standing on its own: win, lose, or draw. That’s what America is about is [sic] taking the chance to succeed and understanding when you fail that you gotta pick yourself up and go back to work. Ford is that company for me.

Not only does Chris McDaniel feel that way, but others do too. A Rasmussen poll recently revealed that nearly one in five Ford buyers chose Ford because they resented the government-manipulated bailout of its competitors. Nevertheless, the ad aroused fury in the sycophant media. Some even accused Ford of hypocrisy, because it had in the past accepted loans from the government and lobbied the government for support.

But that doesn’t pass the laugh test. The fact stands that Ford didn’t collude with the feds and the UAW to screw its creditors in a jury-rigged bankruptcy, while GM and Chrysler surely did.

Also noteworthy is the fact that the same critics of Ford’s alleged hypocrisy were conspicuously silent when GM ran ads in the wake of the Toyota brake hysteria, saying that GM cars were safer — thus hypocritically ignoring its own sorry record of recalls. These critics were also silent about GM’s attempt to get a class-action lawsuit dismissed, a suit by owners of Chevy Impalas wanting GM to honor its warranties. Considering the number of people crippled and killed over the decades by its own defective vehicles, GM was being hyper-hypocritical.

After Ford pulled its ad, Chris McDaniel honorably stuck to his guns. As he later put it,

I still stand by what I said, and that is, as Americans, we need to decide if we’re going to be run by a government or if we’re going to be run by free enterprise. That’s really the debate we are facing today. So I applaud Ford, still, to this day, for having the courage to put that ad on the TV and spur the debate.

Indeed, sir.

Now, an interesting theory has been aired by no less a writer than Daniel Howes, associate business editor for the Detroit News. He has suggested that Ford pulled its apt, accurate, and reasonable ad after a phone call from the White House expressing, well, discontent. Howes noted that the White House later denied the story. But we have a right to be skeptical.

After all, this is the most mendacious regime in recent history, Nixon notwithstanding. In a short time, it has lied and deceived about more major matters than any others.

Some of this has come to the attention of Rep. Darrell Issa (R-CA), chair of the House Oversight Committee, who sent a letter to Ford asking whether it removed the ad under White House or other pressure. Ford responded on Facebook and Twitter that it hadn’t removed the ad permanently, but Issa wants a response in writing.

I suggest that what Issa really needs to do is to hold hearings on the whole affair: the crony bankruptcy, the UAW funding of Democrats over the period leading up to the crooked affair, the subsequent federal actions devoted to running GM and hurting GM’s competitors, etc. Let’s see all the internal memos, emails, and other documents, and let’s question everyone involved — under oath before the House Committee. Turn over this rock, and shine a light on the roaches underneath. Then we will all understand the nature of crony capitalism better, and in more detail.




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Financial Responsibility

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The recent recession, which some call the Great Recession, has been around for years, yet it simply refuses to go away. I believe that American business is strong enough that not even Obama’s socialist agenda can permanently destroy our prosperity. But even if a Republican is elected in 2012 and this recession ends, what is to prevent another one?

The question of what causes recessions is perhaps the single most important and most highly political question that the science of economics seeks to answer. The Keynesians and socialists have one answer, the Austrians have quite another. Perhaps the Federal Reserve’s manipulation of interest rates has caused or exacerbated the recession. However, I think that from an empirical, factual standpoint the linchpin of the Great Recession was the American public's financial irresponsibility, as manifested in the collapse of the real estate bubble. Many thousands of Americans irrationally believed that home prices could only go up, and they incurred real estate mortgage indebtedness far in excess of what a financially responsible person would incur. When real estate prices collapsed, very many mortgages went into default, which led to foreclosure sales, which further reduced home values, which triggered a downward spiral. It is probably true that government efforts to encourage low-income home ownership and government home mortgage guarantees contributed to inflating the real estate bubble. But the disaster would not have been so widespread if more home buyers had been committed to living within their means or had been more risk-averse.

This is the most dangerous matter, and also the easiest to correct. If the American public, especially the lower middle class, learned to understand the concept of “financial responsibility” then this syndrome would never happen again.

What precisely is financial responsibility? I think that the main point that people should understand is that money does not grow on trees, and there is no such thing as a free lunch or easy money, and that money is not magical and cannot be created by waving a magic wand. The great Randian contribution to economic theory is the idea that in a free market people trade value for value, and to “make money” is to create value. (Yes, Ayn Rand did not invent this idea, but she perfected it.) In order to make money you have to do work to produce the value; in other words, you need to make the money that you trade with others when you buy things from them. If you don’t produce value, then you have nothing to trade.

This not only means that people earn and deserve their salary by working at their job; it also means that people do not deserve to consume more value than what the other traders in the free market are willing to purchase in exchange for money. From each as he chooses, to each as he is chosen, to quote a Robert Nozick saying that captures this concept.

Financial responsibility is the understanding that you cannot spend more money than the amount you earned because of the work you did, unless someone gives you charity or you steal wealth from others, and that you cannot consume a value that has not been produced by someone. To use Rand’s old-fashioned phrasing, you can’t have your cake and eat it too, or as I would prefer to say, you can’t eat your cake before you bake it. Understand this, and you will probably not spend money that you don’t have or use borrowed money to buy stuff when you can’t repay your loans. If you want to buy something, then you will be more likely to do the work necessary to earn the money before trying to get what you want.

This understanding that money is finite and must be created before it can be spent is the essence of financial responsibility. Implicit in the concept, however, is the notion that charity and theft are exceptions, and the general rule is that you, and only you, must do what is necessary to make your own money and control your individual financial destiny.

But if you understand this principle then you will be very careful about economic risk, because you will understand that you will be required to assume responsibility if you make a mistake.  You will be on the hook for your losses and no government will bail you out. Financial responsibility means being held responsible, which means that you are held accountable and you will accept the rewards and punishments that result from your economic choices. Thus, you will not assume risks in excess of the amount of sweat or skill you are willing to put in to compensate for your mistakes. A person who is financially responsible would not assume a gigantic mortgage on real estate he had an annual income in the lower-middle class range, because he would understand that the debt would actually need to be repaid.

If the public were financially responsible, it would not put up with a government that steals money from others or borrows excessively and spends money that it does not have.

It seems to me that the solution to the problem is for high schools or colleges to incorporate personal finance management training into their liberal arts educations. Simply teaching people how to write up a personal budget that matches income and expenditures, sort of like a balance sheet, would go far toward creating the practical skills of financial responsibility. Some high schools have such classes, but they are treated like trivial afterthoughts compared to the more important subjects. Also, merely teaching students how to spend money is not enough; the financial responsibility class would somehow have to simulate earning income in proportion to productivity, possibly by tying fake money to GPA or class performance, to give students a feel for the fact that you cannot spend what you have not earned. The ideal personal finance class would teach career ambition, how to budget to spend within your means, and the crucial importance of saving money and not borrowing beyond your ability to repay.

One would expect the poor to appreciate the crucial importance of saving money. But it is precisely the low-income families that are most vulnerable to financial irresponsibility. The poor face a dark temptation to borrow beyond their ability to repay and not worry about repayment until it is too late, so that for a short time they can live a more affluent lifestyle before their debts catch up with them. The temptation to take shortcuts to one’s desires is deeply seductive even to rational, honest people. But people with no money to spare can least afford to make mistakes. Good finance classes in high school would help poor families budget properly, save for retirement, and avoid predatory lenders. This would help the poor much more than all the modern-liberal nonsense of entitlement spending, welfare, food stamps, etc.

Middle- and upper-income people could also benefit. A study cited on Yahoo claims that the average New Yorker is $200,000 in debt and the average Californian is $300,000 in debt. The American economic system encourages credit card debt, home mortgage debt, and student loan debt. I personally have struggled with handling my finances, which were recently made worse by roughly $90,000 in law school student loans that I needed to incur; and I wish that there had been a serious class in this subject that I could have taken, particularly in college where young people are supposed to learn how to live like adults.

If such classes were commonly available, the average American would actually be exposed to the concept of financial responsibility, and the odds of another recession happening would be greatly reduced. If it were customary for every American student to take a class in financial responsibility, it would be more likely for voters to vote for financially responsible fiscal policy. And if American politicians had taken such classes, they might have better training in the art of living within a budget and be more appreciative of a balanced budget and the dangers of excessive debt.

Of course, if the public were financially responsible, it would not put up with a government that steals money from others or borrows excessively and spends money that it does not have. So the leftists who control most colleges and the teachers' unions who control the high schools would fight to keep people from understanding the truth about financial responsibility and how to prevent another recession.  But while government is the primary source of economic problems, even in a libertarian anarchy they would still exist, if the majority of individuals were financially irresponsible.




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Bachmann the Ominous

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“Don’t settle!”

So Representative Michele Bachmann shrilled repeatedly in a speech at Liberty University in late September, a speech rebroadcast on C-SPAN. Curiously, she never said what she meant by that theme of her entire speech. To judge from all the recounting of her own religious experiences, she meant: “Don’t settle for less than total commitment to Jesus Christ.”

But a campaign speech must have meant more than that. By implication, anyway, Bachmann meant: “Don’t settle for less than ideal public policies; do not compromise or even discuss compromise or delay.”

Bachmann described miserable conditions in the Plymouth Colony in 1630, when the colonists were nevertheless persuaded not to return to England. The lesson she was evidently drawing was: “Stick to the projects you have embarked upon,” and, by implication: “Never change course; never recognize and learn from mistakes.”

For scientific research, “Don’t settle” is sound advice. Scientific questions are not settled by compromise, by counting scientists’ heads, by argumentum ad hominem or ad populum, by personal abuse, or by what Ayn Rand called “argument from intimidation.” Scientific questions are settled, but only provisionally, by evidence and reasoning, with scientists double-checking each others’ work and being willing to revise their own judgments.

But Bachmann was not delivering a speech on scientific method. In her political context, she meant: “Don’t compromise on ideal public policy as it has been infallibly revealed to me and to you.” Such a mindset is ominous in anyone and especially in an aspirant for high office.




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Enron, Solyndra, and Double Standards

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In the wake of the Solyndra debacle, no less than the head of the Solar Energy Industries Association — one Rhone Resch — opined, “It’s going to be very similar to Enron’s legacy in the oil and gas industry” (though he quickly added, “Just in the sense of a history that flared out fairly quickly and fairly publicly”). Enron, we all recall, was the energy company that hit the wall after misleading investors with fraudulent financial reports.

Pace Resch, I think that the comparison between Solyndra and Enron is a false analogy. It overlooks their salient differences. First and foremost, when Enron went bust, it didn’t burn the American taxpayer, which Solyndra most assuredly did. It had nearly a half billion bucks in guaranteed loans, which the taxpayer must now cover.

Second, while Solyndra’s CEO was a major supporter of Obama, as Enron’s was of Bush, when Enron’s CEO called the White House for help, he got none; but when Solyndra’s head called his buddy in the White House, he got plenty.

Third, the mainstream media trumpeted the Enron fiasco for months, using it as a handy cudgel with which to bash Bush; but the media have been virtually silent about the Solyndra mess, even in the face of the Solyndra execs pleading the Fifth before a congressional committee trying to investigate the mess.

Fourth, it is doubtful that Hollywood will make a movie about Solyndra, as it did with Enron (The Smartest Guys in the Room), indicting both the industry and the president. The Green neo-socialists — aka Watermelons — are much too worshipful of both the solar industry and Obama.




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