Liberty & Power: Group Blog
David T. Beito
At a recent gathering at the Netroots Nation, the participants were asked"do you, personally, spend the most time advancing currently?" The winner was health care reform, with 23 percent, and second place was"working to elect progressive candidates in the 2010 elections," with 16 percent. In 11th place -- at the very bottom of the list -- was"working to end our military involvement in Iraq and Afghanistan." Just one percent of Netroots Nations attendees listed that as their most important personal priority.
Jeffrey Rogers Hummel
There is a widespread tendency to reify Lincoln's thought, especially with respect to slavery and race, as if he held a consistent set of well-integrated ideas throughout his entire life. This can be true of those who admire Lincoln, as for instance the political theorist Harry Jaffa, who takes as his lifetime template the more mature Lincoln beginning to embrace full political rights for African-Americans, as well as true of critics of Lincoln, such as Ebony editor, Lerone Bennett Jr., who sees Lincoln as always and forever a full-fledged white supremacist. Both extremes overlook the fact that Lincoln was human. He changed his views throughout his life and was capable of inconsistency at any particular time, just like the rest of us mere mortals.
Wilentz, however, accuses several of the books he reviews of an opposite failing. They embrace what he calls the"two Lincolns" approach, in which"Lincoln's anti-slavery political convictions" not simply"hardened over time" but instead arose from a sudden and dramatic conversion"in the deepest recesses of his soul." In challenging this approach, Wilentz quite correctly points out that Lincoln was first and foremost a politician, who was frequently capable of adjusting his public statements to what the electorate would tolerate, even when those statements diverged markedly from his personal views. The peculiar fact that Wilentz actually considers this one of Lincoln's admirable traits hardly mars the power of the essay. My only reservation is that I think that Wilentz sometimes approaches too closely to the Jaffaite illusion that Lincoln's opposition to slavery was as strong and consistent in his early life as it was at the time of his death.
Hat Tip: Ross Levatter and Randy Barnett, the latter of whom posted about the Wilentz essay at the Volokh Conspiracy.
Jeffrey Rogers Hummel
Jane S. Shaw
There is but one means, the progressive believes, to free mankind from the misery and degradation produced by laissez-faire and rugged individualism, viz., to adopt central planning, the system with which the Russians are successfully experimenting. It is true that the results obtained by the Soviets are not yet fully satisfactory. But these shortcomings were caused only by the peculiar conditions of Russia. . . .
Such is the philosophy taught at most present-day schools and propagated by novels and plays. It is this doctrine that guides the actions of almost all contemporary governments. The American "progressive" feels ashamed of what he calls the social backwardness of his country. He considers it a duty of the United States to subsidize foreign socialist governments lavishly in order to enable them to go on with their ruinous socialist ventures. In his eyes, the real enemy of the American people is big business, that is, the enterprises which provide the American common man with the highest standard of living ever reached in history. . . . He never mentions the new or improved products which business almost every year makes accessible to the masses. But he goes into raptures about the rather questionable achievements of the Tennessee Valley Authority, the deficit of which is made good out of taxes collected from big business.
The most infatuated expositors of this ideology are to be found in the university departments of history, political science, sociology, and literature. The professors of these departments enjoy the advantage, in referring to economic issues, that they are talking about a subject with which they are not familiar at all. This is especially flagrant in the case of historians.
Jonathan J. Bean
In Part II, I offer the following information to shock you into how little privacy you have via e-mail or the Internet. In short, if you use a university email account--even off campus--the university owns that electronic "property" and may archive it for years....
For more, read
David T. Beito
Here is my post at the blog of Historians Against the War:
Or are we now just Historians Against the Republicans?
Since it took power, the new administration has ordered bombings that killed twenty-four Afghan civilians (including several children), promised that an attack on Iran remains “on the table," vowed to double U.S. forces on the ground in Afghanistan, and proposed an increase of forty-billion dollars in the already bloated Pentagon budget.
Meanwhile, Richard Holbrooke, the new special envoy to Afghanistan and Pakistan has predicted that the Afghan war will last longer than the fourteen years of the Vietnam War, Vice President Biden has matter-of-factly promised an"uptick" in American casualties, and the American commander of NATO forces announced that all Afghan drug dealers, regardless of any connection to the insurgency, will be killed on sight.
Even the good news is less hopeful than it seemed on first appearance. Though President Obama has begun plans to close Gitmo and end torture, he also issued executive orders to continue the policy of "rendition."
All of these developments should be of grave concern to all advocates of peace. Despite this, the official face of HAW on the front page of the website highlights a cartoon of Michael Steele, a person who has nothing to do with setting U.S. foreign policy. It is not the first cartoon of this type to appear. If this continues, readers will naturally start to wonder if HAW still takes a firm stand against the pro-war policies of the United States.
Across the United States, state governments are crafting economic strategies that blur the boundaries between the public and private sectors. They are targeting specific industries and intervening in ways that go far beyond traditional perks like tax breaks and cheap land.
The article gives many examples of government venture funds, R&D consortiums, and other so-called public-private partnerships now operating or about to begin.
States have always engaged in such activities to some extent, although a public revulsion against them curtailed them to some extent in the wake of the debacle of the late 1830s and early 1840s, when some states revised their constitutions to forbid or constrain such undertakings. Recently, however, the states, like all other levels of government in the United States, have launched into public-private partnerships with unprecedented vigor and funding.
These partnerships, which epitomize economic fascism, promise to waste resources on a wide front. The idea that politicians and politically appointed “experts,” in league with rent-seeking businessmen, can allocate resources more effectively than the private capital markets is a characteristic form of the folly that is leading our generation to march over the same cliff that our forebears marched over in the 1930s. Each step in this direction moves us farther from economic liberty and closer to the complete politicization of economic life—a trend that recent de facto or de jure government takeovers of large banks and other financial firms are already accelerating.
David T. Beito
Robert Scheer: I don't think the idea of nationalizing, as it's now being called--which means bailing out these banks, setting them straight, then letting them go private again, which is the model that everybody is using, and the people who get screwed are the people whose retirement funds had common or preferred shares and they get wiped out, and these bankers come out richer than ever at the other end--that's not a leftist idea and it's not socialism. This is what we used to, in Comparative Economic Systems, call fascism. It's putting government at the service of the big financial interests. That's what happened in Italy, that's what happened in Germany, that's what happened in Japan. . . .
Tony Blankley: What I don't understand is how my colleagues on this show, who I believe were for Obama, are now saying he's leading a fascist regime. Did he mislead them a few weeks ago when he was still running? . . .
Robert Scheer: To answer your question, I am disappointed in Barack Obama and I'm not quite sure what he's doing.
What is proposed herein, in promoting and distributing some of the fundamental ideas in the novel, such as entrepreneurship, individual initiative, wealth generation, and prosperity, is to look at these anew from the perspective of the dawning of the 21st century. Before discussing, however, the means of disseminating these ideas, let us look at the historical context of the novel as well as what has occurred globally in the half-century since its publication.
Ayn Rand, History and Technology:
Rand’s two most famous novels both display a sense of History and, especially of the history of technology. The Fountainhead (1943) focuses on Architecture, and the emergence of the technology of the modern steel skyscraper building. The relationship between the Architect, Howard Roark, and his mentor, Henry Cameron, can best be understood as similar to the historical relationship between Frank Lloyd Wright (1867-1959), and his mentor, Henry Louis Sullivan (1856-1924). Sullivan, however, was never as forgotten, or neglected, as is Cameron in the novel, and is considered “the father of modernism” and of the steel skyscraper in architecture See, for example, Sullivan, The Autobiography of an Idea (1924), as well as his Kindergarten Chats and Other Writings (1979), and, especially Wright’s Genius and the Mobocracy (1949), his brilliant defense of his teacher, Sullivan. In 1959, this writer (Marina), given his interest in design and building, wrote a research paper at the University of Miami on the relationship between Sullivan and Wright, focusing on the former. Wright was recognized in 1991 by the American Institute of Architects as"the greatest American architect of all time" Ayn Rand had chosen wisely in the choice of a role model for Roark!
Let us focus, however, on the several technologies in Atlas Shrugged, which is not only futuristic in time, but also science fiction as well, ranging from Reardon Metal to a Motor that will stop the Engine of the World. Finally, there is “Atlantis,” a Utopian Community if ever there was one. What can be the context and meaning of these ideas in the emerging Crisis of the 21st Century? To simply hash over the ideas of the novel as if nothing has occurred since 1957, or as if there is no present crisis, is to consign it to a sterile exercise in summary and literary criticism.
The novel is, on the whole, built around two technologically related ideas. The first is that of Galt’s motor, a rather small box that is able to draw static electricity from the atmosphere and convert it to usable, kinetic energy, the second is that there is a location, not primitive, as in the case of the caves where Osama bin Ladin has hidden successfully for years, but a rather sophisticated community into which the world’s creative geniuses can “drop out,” a “Galt’s Gulch” that can remain unknown to the governing authorities. That was highly problematic in 1957, let alone in a world of satellite mapping images and Predator drones, as is the case today. One might even wonder about the possibility of the success of Piracy as in the book, until we are reminded of recent events of that nature off the coasts of Africa and parts of south-east Asia.
From Futuristic Science Novel to 21st Century Reality, and Also Using the Past:
In using Atlas Shrugged as a starting point with which to explore alternatives to the Global Crisis of the 21st Century, it might be suggested that what is needed is to place these events in a broader historical, philosophical context, in short, within the parameters of what might be called a Philosophy of History.
Just as Miss Rand borrowed heavily from the biographical, historical context of the careers of Sullivan/Wright in writing The Fountainhead, so she borrowed from the writer Garrett Garet in many aspects of constructing the basic theme, name and character of Atlas Shrugged from Garet’s novel, The Driver (1922). Still, the heart of her book is her delineation of a Philosophy that she chose to designate as Objectivism, evident in Galt’s famous lengthy television address toward the end of the book, and in most of her subsequent writings.
What this writer finds most lacking in the novel is what one might call a broader Philosophy of History. In this regard, she could have done worse than to have again been influenced by Garet, whose most well known work is probably The People’s Pottage (1953), which contains three essays dealing with The New Deal, the US as a giant Charity organization, and, most important from a larger historical perspective, “The Rise of Empire.” Pretty much all that has happened in the last fifty years of US and Global history is outlined in that essay.
The major question facing us as human beings, living in an increasingly global society is, “Can that evolution toward increased government and bureaucratic centralization, which is the essence of Empire, and that has characterized every Civilization throughout History, be challenged and/or reversed?” Some historical determinists, such as Spengler and Toynbee, tended to believe, it cannot be done.
Rand’s creative solution was to offer an answer within the context of a somewhat futuristic novel involving Science and a mechanism to halt the drift to what she saw as Collectivization, and we have called Empire.
An Electric Motor and a Mechanism to “Stop the Motor of the World;”
When this writer first read Atlas Shrugged almost 50 years ago, he kept expecting that Galt would use his motor literally to stop the World in some fashion. That turned out, of course, not to be the case. His motor, to be sure, was used to generate electricity, but the “motor to stop the world” turned out to be convincing many of the worlds most creative thinkers and entrepreneurs to join him in his secret Valley in Colorado.
The question today is whether that withdrawal technique/mechanism would really work to halt the drift toward Socialism, Collectivism, or Empire – what might also be called State, Corporate Socialism? We would suggest, that it would not, and that imperial bureaucracies will simply find others to carry on even as societies, nations and civilizations continue their decline toward greater chaos and uncertainty as is evident in the financial crisis today.
What, Then, is to be Done?
What is needed is a new decentralized technology that breaks us free of the various governmental mechanisms which restrain innovation today such as antitrust laws, patents and copyrights, as well as a number of other legalistic procedures which block innovation, or slow it to a crawl.
At the Marina-Huerta Educational Foundation, we intend to demonstrate that an actual motor similar to Galt’s already exists, and can be used to create electricity in a house and beyond, selling the excess back to the power company, either private or government owned.
We suggest also that a somewhat similar mechanism to Ayn Rand’s withdrawal of the creative individuals already exists, in the earlier civilizations such as China and Classical Civilization in the West. We refer to Taoism and early Christianity.
Innovation and Instruments of Expansion
While it may seem paradoxical, despite the many inventions of the last century or so, there has been an increasing slowdown with respect to energy, what the historian Carroll Quigley referred to as “Instruments of Expansion,” upon which civilizations are built.
Let us look for example at classical, Greco-Roman Civilization from which Western Civilization developed. Karl Marx was perhaps first among those who asked, why didn’t Capitalism develop even before the birth of Christ when that Civilization had the steam engine, but used it only to power children’s merry-go-rounds?
The answer is actually rather self evident in terms of Instruments of Expansion. The great Instrument of the Expansion in Classical Civilization was human slavery, and which, apart from its morally repugnant aspect, had definite limits upon the amount of Energy that it could generate to produce goods. Both the slave owners and the workers in the Guilds (Unions) had vested interests in preserving human slavery, and kept the steam engine from being generally used. That sounds almost a bit like Atlas Shrugged, but over two thousand years ago!
In preaching Equality the early Christians withdrew to a great extent from that Civilization, “rendering unto Caesar,” (the State) as a little as possible, until, eventually, the State centralized these once decentralized communities, and created a Church that it could control to a great extent.
Thus, the development of the steam engine as a source of Energy for the Industrial Revolution had to wait almost two millennia until even Feudalism had been virtually expunged from Western Civilization.
One can trace a somewhat similar evolution in China as Statism, called Legalism and neo-Confucian, eventually triumphed over both Taoism and Confucianism. It is indicative of the intellectual confusion of our own age that many recent writers refer to Communist China as reverting to Confucianism, when it is evident the model is Legalism and neo-Confucianism, both of which fit in nicely with today’s State Corporate Socialism. (For one of this writer’s pieces on China and the Tao, see http://mises.org/freemarket_detail.aspx?control=100 )
It is evident that the first great Individualists in human history were the Taoists in early Chinese history. Recent discoveries of even earlier Taoist manuscripts make this even more obvious. As the great research chemist Joseph Needham demonstrated in his monumental 12 volume history of Science and Civilization in China, the Taoists were the great scientists of that Civilization. One does not need to go as far as did the Wall Street Journal several decades ago in discussing the Chinese Science Exhibit then touring the West, to ask “Did the Chinese invent just about everything?”
What the Taoists, early Christians and inhabitants of Galt’s Gulch have in common is that they chose essentially to withdraw from the evolving Statist, Imperial Civilizations in which they found themselves.
Using Atlas Shrugged as a takeoff point toward creating Decentralization and a restoration of individual freedom in one’s lifetime:
The Marina-Huerta Educational Foundation is dedicated to exploring new ideas with respect to an affordable, sustainable lifestyle that allows the individual to cut himself/herself free from many of the Statist constraints now facing one within many nations of the world. An emerging outline of these areas can be found at our website, which is itself now being totally redone with pictures from our recent Project in Guatemala. http://www.m-hfoundation.org
We would suggest that the State has the means today, and did at the time that Atlas Shrugged was written, to seek out and destroy any “secret” community such as Galt’s Gulch. What the State cannot do however, either in this country or in other nations such as Guatemala, where we recently completed a community center which will be at the center of a new village eventually housing 800 families, is to prevent individuals from building the kind of houses we suggest, along with new sources of decentralized energy, using the Sun and wind to develop Electricity, as well as utilizing rainwater and reusing gray water, along with more efficient kinds of waste disposal, all of which can contribute to growing one’s own food supplies. Thus, many people can openly, but without fanfare, begin to withdraw from essential cooperation with the State.
This writer has often wondered, how were these essentials of life accomplished in Galt’s Gulch, and by whom? Ah well, in Science Fiction, such realities are simply ignored!
A crucial point was reached in Western Civilization at the end of the 19th and early 20th centuries with the discovery of Electricity and the means to put it to use. This ought to have led to an even greater Instrument of Expansion, eventually harnessing the power of the Sun and Wind. There is not space here to recount the titanic battle over Centralization as opposed to Decentralization that occurred over Electricity. It would appear, however, by the very nature of the role of Electricity and Galt’s motor in Atlas Shrugged, that Ayn Rand had some notion of this. One might argue that Nikola Tesla was the “hidden hero” of the book much as Wright was in The Fountainhead.
The use of AC Electricity meant it could be sold and moved from one location to another. While Tesla wanted Electricity to eventually be free, as is the air we breathe, J.P. Morgan wanted to create a monopoly over it. The State, of course, likes the latter notion since it can be taxed, and even corporations such as Enron become involved in the whole process of selling it in a centralized fashion.
Now the American Government continues this Centralization with billions of $$ to be spent on expanding this existing power Grid to move Electricity, losing immense amounts along the way, from the West to the East. If, in addition, Decentralization of Electricity was stressed as well at the level of individual homes, the existing Grid might still be used, without spending additional billions.
The great struggle of the 21st Century will be between those who seek to expand State Power through Centralization of a wide variety of human activities, which has led to the disintegration of State Empires throughout History, and those who actively use Decentralization to free up, and enrich their own lives in the relatively short time we each have on Earth, regardless of what the State chooses to do. That is the real lesson of Atlas Shrugged, and why it retains our interest today!
Jeffrey Rogers Hummel
Aeon J. Skoble
Jeffrey Rogers Hummel
"Any discussion of mark-to-market accounting must differentiate between the beneficial effects of honestly reporting assets at what they are actually worth and the destructive impact of inflexible regulations that utilize the principle. Current discussions have blurred the distinction.
"(1) The Financial Accounting Standards Board (FASB) determined that securities held by a company which it intends to sell when funds are needed for another purpose ought to be reported at fair market value rather than historical cost. This seems eminently sensible to me.
"(2) The FASB allowed an exception for debt securities which would eventually mature at a fixed price, and which the company had the positive intent and ability to hold to maturity. Mark-to-market accounting is specifically not required when the company elects to classify the security as one to be held to maturity.
"(3) In spite of ignorant comments to the contrary, 'market' doesn't mean that the last trading price of a security must always be used, nor that a security whose market has virtually disappeared due to unusual circumstances must be valued at zero or near zero. The FASB explicitly permits the use of alternative market measures in such circumstances, such as the complicated derivative pricing model known as Black-Scholes. For instance, Berkshire Hathaway (Warren Buffett's company) has $8.1 billion (at cost) of derivatives on its books, all carried under mark-to-market accounting, but none of them currently priced based on the non-existent market for those derivatives.
"I am fully supportive of the use of mark-to-market accounting on balance sheets. It is clearly the most honest way to report derivatives. So what's the problem with mark-to-market accounting? I see the following government-created problems associated with them:
"(1) Mark-to-market was adopted by regulators as the basis for determining minimum capital requirements. Creating an inflexible regulation based on an inherently volatile measure was always an accident waiting to happen.
"(2) While foresighted bank executives might have chosen to maintain capital in excess of regulatory requirements so that a decline in value wouldn't trigger a crisis, it would have made no business sense to do so, since it would have reduced their lending income and ability to pay competitive rates on deposits or offer other benefits to attract customers. In a free market, they would have been able to do so, since they would have gained a reputation advantage from their greater safety, but with FDIC insurance protecting all deposits, customers don't shop based on safety, as they assume they are protected by the government from the loss of their deposits. Thus, only the rates and benefits offered by a bank matter to a customer, not the reliability of the bank, thanks to the FDIC."
(JRH interjecting: I might add that Less's point here is well supported by the historical record. Prior to government deposit insurance, U.S. banks voluntarily maintained capital-asset ratios in the range of 10 to 20 percent, way above current mandated levels.)
"(3) With banks thus always seeking to keep only the minimum required capital, the problem was further exacerbated by the Basel capital requirement formula, which requires less than half the capital if kept in the form of AAA securities compared to high quality individual mortgages (as I discuss in my article on Credit Default Swaps, forthcoming in the April 2009 issue of The Freeman). This caused an explosive increase in the worldwide demand for AAA securities as a result of the needs of regulatory arbitrage.
"(4) With capital of virtually every international bank invested as heavily as possible in AAA securities critical to the financial competitiveness of the bank, the problem was further exacerbated by the ratings cartel created by the SEC in 1975, which effectively mandated that companies obtain a rating from Moody's, S&P, or Fitch, who were thus effectively insulated from the destructive effects of reputational damage by a system that made it impossible for them to be put out of business by more accurate upstart rating services. This also prevented better methods of risk measurement (such as Credit Default Swaps) from replacing ratings.
"(5) Fannie and Freddie fed the supply by creating AAA securities in gigantic sums, initially from the securitization of high-quality mortgages, then from lower-quality mortgages that had components artificially improved in quality from the creation of 'tranches', and finally from lower tranches artificially improved in quality as a result of Credit Default Swap protection from AAA-rated companies such as AIG (also discussed in my CDS article). AAA ratings that were, in many cases, undeserved.
"(6) It is also possible, although I haven't thought this through, that the mortgage lending boom itself was stimulated by the need for AAA securities to satisfy regulatory arbitrage needs worldwide, and once it was clear that low-quality mortgages could be turned into AAA securities, the lowering of lending standards was inevitable, even absent the CRA and FHA mandates.
"So, thanks to various government interventions, banks operated with the minimum capital required by the mark-to-market application of the law, consisting almost entirely of artificially created AAA securities benefiting from artificially high market pricing resulting from sloppy ratings. And then reality bit, and an honest revaluation of these securities based on mark-to-market accounting, linked to inflexible government regulations, brought down the banking industry. And that is the extent to which I believe mark-to-market accounting can be blamed for this crisis."
Jeffrey Rogers Hummel
Fortunately, libertarians have begun to challenge the Statist bias of presidential ranking. One of the first works to do so was a Mises Institute collection (to which I contributed a chapter), published back in 2001 and edited by John V. Denson: Reassessing the Presidency: The Rise of the Executive State and the Decline of Freedom. More recently the Cato Institute has published Gene Healy's The Cult of the Presidency: America's Dangerous Devotion to Executive Power (2008), and the Independent Institute has published Ivan Eland's Recarving Rushmore: Ranking the Presidents on Peace, Prosperity, and Liberty (2008). Only Eland's book actually ranks all the presidents, although the Denson volume contains a wonderful article by economists Richard Vedder and Lowell Gallaway offering a tentative ranking based on the growth of government.
I have been privately circulating for some time my own rankings, so I thought this might be an appropriate occasion to update and unveil them to the general public. They differ significantly in some respects from Eland's. I cut off obviously before Barak Obama and don't count William Henry Harrison, who was in office only a month. The one ranking I've actually elaborated on in print is my choice of Martin Van Buren as the least bad president. The article appears both in the Independent Review and the Denson collection (which kept my preferred title,"Martin Van Buren: The American Gladstone"). And of course, my book, Emancipating Slaves, Enslaving Free Men: A History of the American Civil War, implicitly explains why I rank Abraham Lincoln the worst.
Except for the first ten in both the "Least Bad" and the "Most Horrible" categories, my judgments are all subject to some revision. Further study or arguments might persuade me to shift them around slightly. One of the most important criteria in my rankings is the body count. I have the idiosyncratic belief that presidents merit high marks for keeping the country out of war rather than dragging it into one. Overall my rankings are based on explicitly libertarian criteria. Those who rolled or held back government intervention get points, those who increased government power lose them.
Most Horrible U.S. Presidents (starting at worst):
1. Abraham Lincoln
2. Woodrow Wilson
3. Harry Truman
4. Franklin D. Roosevelt
5. Lyndon Johnson
6. George W. Bush
7. Theodore Roosevelt
8. George H. W. Bush
9. Herbert Hoover
10. John Adams
11. William McKinley
12. James Madison
13. James Knox Polk
14. John F. Kennedy
15. George Washington
16. Millard Fillmore
17. John Quincy Adams
18. William Howard Taft
19. John Tyler
20. Jimmy Carter
21. Franklin Pierce
Least Bad U.S. Presidents (starting at best):
1. Martin Van Buren
2. Grover Cleveland
3. Calvin Coolidge
4. Warren G. Harding
5. Thomas Jefferson
6. Andrew Jackson
7. Gerald Ford
8. James Monroe
9. Zachary Taylor
10. James Garfield
11. Ronald Reagan
12. Dwight D. Eisenhower
13. Andrew Johnson
14. William Jefferson Clinton
15. Richard Nixon
16. Rutherford B. Hayes
17. Chester Arthur
18. Benjamin Harrison
19. Ulysses Grant
20. James Buchanan
David T. Beito
It would be a disastrous strategic mistake for HAW to adopt the proposed new statement. The statement’s assertions on domestic policies will only weaken the anti-war movement by driving away anti-imperialist libertarians and conservatives who have been among the most committed opponents of the wars in Iraq and Afghanistan.
Whereas the original statement wisely avoided making domestic policy prescriptions, the proposed new statement calls for “a drastic reduction of national resources away from military spending and towards urgently needed domestic programs.” This is an attack on the politics of libertarians and conservatives who have campaigned tirelessly against the wars but who object to spending on both the warfare and the welfare state.
Similarly, the claim that “the current, rapidly escalating crisis of global capitalism, which is creating suffering worldwide, will lead to escalating wars abroad and intensifying repression at home,” is rejected by many anti-war libertarians and conservatives who believe that the source of the current crisis is too little, not too much, reliance on free-market “capitalism.” Several scholars sympathetic to HAW’s original statement, such as distinguished economic historian Robert Higgs, author of Crisis and Leviathan, attribute the current global economic crisis to governmental actions such as deficit spending, bailouts, Federal Reserve inflationary credit expansion, various stimulus plans, and vast military spending.
Three years ago, there was another attempt to make similar changes to HAW’s statement of purpose. David Montgomery, a founder and leading member of the organization, eloquently gave cheer to those of us who favor the strategy of uniting all anti-war historians when he wrote the following: “I remain cautious, however, about taking organizational stands on some of the other issues mentioned as possible targets of HAW activity, especially the socio-economic impact of imperialism. From the outset HAW has encompassed historians with divergent political views, among them quite a number of conservative libertarians. We must try not only to keep our ranks diverse but united. We should welcome open discussion of such issues, but limit the extent to which we take organizational stands. There are, after all, other organizations that quite properly represent their particular analyses and viewpoints. HAW's aim should always be to involve as many historians as possible and to make them feel at home, without in any way prescribing or stifling particular analyses of US power or interpretations of what is now called 'globalization.'"
Montgomery’s words apply equally today. Let’s not weaken the antiwar cause by adopting positions on domestic and economic issues that will only alienate us from potential allies.
In solidarity against the empire,
David T. Beito
Department of History
University of Alabama
Botanists call it Pueraria lobata, and it’s in the pea family, but don’t let that make you complacent. Kudzu is one of the most invasive of weeds, a pest well-known to those in warmer parts of the country where kudzu has infested an estimated 7 million acres, and kudzu has extended its range into Pennsylvania, New York. Connecticut, Oregon and Washington. Kudzu can grow a foot a day. Left alone, it can completely cover a car in a few weeks, a house in one summer, and it can cover trees up to 60 feet tall. It destroys forests by preventing trees from getting the light they need. People have used goats, poison, fire and other extreme measures in an effort to control kudzu, but it has a terrifying ability to bounce back. Kudzu seeds appear to withstand just about anything except bitter cold temperatures. Dr. James Miller, of the U.S. Forest Service, spent 18 years searching for a herbicide that would have a significant effect on kudzu, and he finally found one, but reportedly it made kudzu grow faster! In recent decades, the federal government has declared a War On Poverty, a War On Cancer and a War On Drugs. Surely it’s time for a War On Kudzu. Only government is big enough to get us out of this crisis.
President Obama has been hoping to draw some wisdom from Franklin Delano Roosevelt’s New Deal, but that might be a mistake in this case, because the New Deal promoted kudzu from sea to shining sea. New Dealers hailed it as “the miracle vine.” The Tennessee Valley Authority, America’s largest power-generating monopoly, imported kudzu plants from Asia and urged millions of farmers to plant it as a way of fighting soil erosion. Henry Wallace, FDR’s Secretary of Agriculture, presided over a national campaign to promote kudzu. His Soil Erosion Service had nurseries that produced some 73 million kudzu seedlings. There were farm subsidies to help those who couldn’t afford to spend their own money planting kudzu. The eager beavers in FDR’s Civilian Conservation Corps planted millions and millions of kudzu seedlings. By 1945, some 500,000 acres in the southeastern United States were cultivated with kudzu. The Kudzu Club of America offered news and inspiration for some 20,000 kudzu fans. It’s easy to see why FDR must have viewed kudzu as something that could lift America’s spirits.
Unfortunately, political power can magnify the harm done by human error. It turned out the federal government might have backed the wrong horse, or the wrong vine, and kudzu did more than a little harm. Even in a crisis, though, a big government bureaucracy moves slowly. During the 1940s, the most aggressive kudzu promotion campaigns seem to have wound down. In the 1950s, the Agricultural Conservation Program removed kudzu from its list of recommended cover crops. The following decade, the Soil Conservation Service limited recommendations for planting kudzu. Then in the 1970s, the Soil Conservation Service took a drastic step, classifying kudzu as a weed.
Lately, the kudzu issue has become less clear. The Pennsylvania Department of Agriculture reports that when kudzu covers a building, it serves as a natural coolant and can help reduce air conditioning costs. So kudzu could turn out to be a key weapon in the War against Global Warming, provided people can hack their way through the vines and get out of their buildings. Surely, it’s worth a few billion, perhaps tens or hundreds of billions, to determine whether the miracle vine is friend or foe.
-- Jim Powell, Senior Fellow at the Cato Institute, author of FDR'S FOLLY, BULLY BOY, WILSON'S WAR, GREATEST EMANCIPATIONS, THE TRIUMPH OF LIBERTY and other books
Here is an excellent piece on that, comparing it to a Carbon Tax, by historian and Forbes magazine columnist, Bruce Bartlett: A Carbon Tax is Better than a Cap-and-Trade.
For a discussion of other of Mr. Bartlett’s work, see my article at HNN from several years ago:
"Asked if the United States was winning in Afghanistan, a war he effectively adopted as his own last month by ordering an additional 17,000 troops sent there, Mr. Obama replied flatly, 'No.'"
“People, people,” he exhorts them in a calm, world-weary voice, “do not panic. I am here to assess the damage and make recommendations for reforms that will prevent a recurrence of this unfortunate and wholly unforeseen act of God.” Whereupon he proceeds to lay out his assessment and recommendations, always speaking in the same quiet, unemotional voice. The stunned and wounded survivors gaze at him in astonishment. “He’s a madman,” one cries out.
Undismayed by the swelling chorus of curses and the groans of the injured, the truck driver addresses the gathering crowd of stunned onlookers. “We must have a strategy that regulates the street-fair system as a whole . . . not just its individual components.” He then methodically lays out a series of recommendations for strengthening the construction materials of stalls and regulating their placement along the street, for ensuring that each transient merchant have an adequate capital cushion against such crises, for monitoring fruitmongers and hippy artists deemed “too big to fail,” to keep them from taking excessive risk. He proposes that the city council consider new ordinances to require that wooden crafts such a birdhouses be made sturdier and to establish a “limited system of insurance” to protect against customer runs on the most daring drug-paraphernalia sellers.
“Moreover,” he continues, “street fairs are too important to be left for each town to regulate on an ad hoc basis.” He proposes that the rules be harmonized among the mayors of all the world’s great cities and that a global street-fair authority be created to monitor street-fair risks and protect the people from accidents such as the one that has just occurred. Listeners look on in amazement, their mouths agape.
With that walk on the imaginary side as a warmup, I invite you to consider the speech Bernanke gave to the Council on Foreign Relations today, March 10, 2009. In this address, he proposes a sweeping overhaul of the regulation of “the financial system as a whole . . . not just its individual components.” According to the Associated Press report,
Bernanke offered new details on how to bolster mutual funds and a program that insures bank deposits. He also stressed the need for regulators to make sure financial companies have a sufficient capital cushion against potential losses.
. . .
To guide the regulatory overhaul, Bernanke laid out four key elements. One is for Congress to enact legislation so the failure of a huge financial institution can be handled in such a way to minimize fallout to the national economy—similar to how the Federal Deposit Insurance Corp. deals with bank failures. Such “too big to fail” companies must be subject to more rigorous supervision to prevent them from taking excessive risk, he said.
. . . Policymakers also should consider ways to bolsterimoney market mutual funds that are susceptible to runs by investors, Bernanke said. That could be done by imposing tighter restrictions on the financial instruments that money markets can invest in or through a limited system of insurance for certain funds. Bernanke also called for a review of regulatory policies and accounting rules, suggesting a larger financial buffer for the FDIC’s insurance program for bank deposits that could be used when conditions worsen. Capital regulations for banks and other financial institutions also must be “appropriately forward-looking” to ensure sufficient money is set aside against potential losses.
These proposals certainly answer the question, How do you make a byzantine regulatory system more byzantine by an order of magnitude? At the same time, they show how you display a conviction that if only you tinker with the apparatus long enough, you can make monetary central planning work, even though central planning has always and everywhere produced economic calamity.
All of this second-order handwaving might be dismissed as touchingly naive or as workaday establishment obtuseness, were it not such transparent grasping for power in the fashion that crisis always brings to the fore in a world entranced by the ideology of salvation by the grace of government. Bernanke concludes that “the government should consider creating an authority specifically responsible for monitoring financial risks and protecting the country from crises like the current one.” And who, pray tell, might fill these mighty shoes? Well, of course, none other than the Federal Reserve System, over which Ben Bernanke presides with such placid and self-confident mien.
In view of the Fed’s fundamental, if wholly unacknowledged, role in bringing about the world’s present economic debacle – by spewing forth the ample fuel that allowed the recent ill-fated mania in real estate and related financial dealings to flame so high ― the question that Bernanke’s current proposals immediately raise could not be more obvious: Quis custodiet ipsos custodes? Until someone can provide a compelling answer to this insistent question, we will be well advised to ignore, or even to denounce, the proposals advanced by this lunatic truck driver.