My Beauty Best Teacher

A principle is a fundamental law of nature or a code of conduct that you should follow, and America was built on principles. In particular, our nation was built on six specific principles, which are sometimes called the 'First Principles' or 'Founding Principles', and throughout our history we have followed these fundamental laws of nature or codes of conduct. In no particular order, here they are, with some discussion and things to think about.

Popular Sovereignty. If you have trouble remembering what popular sovereignty is, first think to yourself "What does the word “popular” mean?" (people) and then think to yourself "What does the word “sovereignty” mean?" (king). Popular sovereignty (or sometimes called the sovereignty of the people) is the belief that the legitimacy of the state is created by the will of its people- or in other words, that the state needs the consent of the people to rule, because the people of the state are the source of all political power. Benjamin Franklin expressed the concept when he wrote, "In free governments the rulers are the servants and the people their superiors and sovereigns." Our Preamble begins by specifying that the power for our government comes from "we the people." But it is important to ask whether America still follows this principle today? Do government officials today behave as if they are working for you- or you are working for them? Does our government still do the will of the people? Who is the servant and who is the master in America today?

Limited Government. This is an easy one to figure out- limited government is a government where any more than minimal governmental intervention in personal liberties and the economy is not allowed. Also called constitutionalism- government must limit itself to the constitution on which it is based  Another way of thinking about it is that in a limited government, government can ONLY do those things which it is specifically given the power to do. Our nation wasn't based on 'weak' or 'strong' government, or 'active' and 'inactive'- it was based on a limited government that can only do those things that are given to it to do. If it isn't a limited government, that means it is an unlimited government, and an unlimited government is a scary thing. This principle was so important, our founding fathers built in many features of our government to promote it- checks and balances, separation of powers, federalism, and even the Bill of Rights. Does America still follow this principle today? If you said yes, show me where in the Constitution the government is given the power to....make schools take assessment tests? Regulate and control healthcare? Regulate companies in the name of fighting global warming? Control banks? Buy stock in housing companies? Punish baseball players for taking steroids? Make someone join a labor union? Speculate on windmills? Tell an executive he/she is making too much? You can debate whether these things are desirable or not, but it is much harder to debate whether or not a limited government has the power to even do these things.
 
Federalism. Self-government was important to our founding fathers, so they put in place a federal system of government, where the power is shared between the national and state governments. Think about it yourself- who should control your behavior- your local township/city? Your state? Your nation? The world? Who should be telling you what you should and should not do? Our Founding Fathers (correctly) believed that your local friends and family and coworkers in your state know best how to run some aspects of your life, yet other aspects should be run in Washington DC- and yet other aspects of our lives should only be run by ourselves. So they put in place a federal system of government to reflect where power should properly lie. Does America still follow this principle today? Do you ever hear this principle mentioned by any government officials, especially national leaders? Do they ever talk about letting states decide major issues, or do they always push for the national government to decide everything? Who should decide (state or national)…healthcare- who is covered, how much, etc? Education- what is taught, what standards, etc? Transportation- where roads, speed limits, etc? Natural Resources- parks, drilling, etc? Before any discussion can be attempted on what to do, you need to ask 'who should be doing it'.
 
Separation of Powers. One of the ways of preventing tyranny is to set up government so that one branch or one person doesn’t have all the political power. So the basic powers of government are distributed among three distinct separate independent branches of government- the legislative (who makes laws), executives (who executes laws), and judicial (who judges laws). In the US, this is Congress, President, and Supreme Court. There are problems with this system- by putting political power in 3 branches, it takes political power from the branch closest the people- the legislative- and give it to branches more prone to tyranny- the executive and judicial. It also creates an inefficient government that can never seem to get anything done, and some people doubt whether or not we have the luxury of following this principle in in times of war? Because of this, this principle has been under attack for years. What do you think- does America still follow this principle today?

Checks and Balances. Although it is important to create three separate and distinct branches of government, you don’t want them to be totally separate or else there will be no way to check them and balance their power. So, in reality, the branches are not completely separate or independent of one another. Each branch is subject to another of restraints, or checks, on it by the other branches. These restraints work to balance the three branches, so that one branch does not become more powerful than the others. The good thing about this principle is that our founding fathers spelled these checks out pretty clearly in the Constitution, and it is rather tough to get around them. But one does wonder- does America still follow this principle today? Are all the branches still balanced? If not, which branch of government has emerged as the most powerful branch today?
 
Judicial Review. One check is so important to our political system, it is elevated to a founding principle soon after our nation was created. What if Congress or the President uses their power in a way that the Constitution does not allow them to do? Or, who decides if everyone is following the Constitution? Judicial review is the idea that the judicial branch can review laws of Congress or actions of the President and judge whether they are following the Constitution. Careful though- judicial review doesn't mean that judges get to decide whether Congress and the President are 'right' or 'wrong'- only whether they are in fact following the Constitution. Is it right that the Supreme Court (9 unelected old lawyers with lifetime terms) get to decide what our Constitution says- shouldn’t the Congress or President do this? What if judges decide to read things into the Constitution that are not there- do we have to follow what they say? Who rules America- judges/lawyers or elected officials? Does America still follow this principle today?

These questions and these thoughts are important, because for some reason, America grew from thirteen little tiny poor states crowding the Atlantic to conquering a continent, and then dominating the world in a way that has never been done before. A lot of nations have a lot of different advantages, but for some reason, America is strangely more powerful then any nations before or after, whether you judge by military power, economic power, cultural impact, or anything else. Why is America Exceptional? What is it about America that makes it different from any other country in the world- different from any other country ever- that makes it exceptional. What is it that makes America exceptional, and not just another country? Is it religious- are we blessed by God? Is it genetic- racial traits or brain drain? Is it environmental- fertile lands, mild climate, rich natural resources? These may play a role, but I would advance that what makes America Exceptional is our our continued belief in the basic principles on which our nation was established. Popular sovereignty, limited government, separation of powers, checks and balances, judicial review, and federalism- our ancestors fought and died to build a government based on these foundational principles behind our Constitution, and by following these codes and fundamental laws, our nation has become the greatest ever.

One last question to leave you with today- what will it mean for our country if we stray from these principles?

You've all been great! Class is over.

Over and over when debating Obamacare supporters I hear the claim that the number one reason why government needs to take on a massive new expensive role in healthcare is because it has become too expensive. These Obamacare supporters think adding more government to the equation will make healthcare less expensive. They are so wrong.

The reason why healthcare is expensive is because of government. Adding government to healthcare in the past has resulted time and time again with a higher cost for healthcare. Government is the problem, not the solution. And this is not just rhetoric- the evidence and data supports the conclusion that adding more government involvement and interference in the private industry of our nation's healthcare has made it much much more expensive.

Presidential-candidate Harry Browne wrote about this back in 2002. He wrote:

It may be hard to believe, but back in the 1950s health insurance cost just a few dollars a month for most people -- and it was available to virtually everyone, including people with pre-existing conditions. The percentage of people covered grew steadily from the 1940s. And by the early 1970s, almost all Americans were covered by some form of insurance. Then the politicians went to work to load up policies with mandatory coverage of all sorts of conditions that may be of no use to you. More and more people decided that insurance had become too expensive and decided to risk being uninsured. By the 1990s coverage had dropped to under 70% of Americans.

In addition, many employers decided health coverage was too expensive. In 1980 fully 97% of the companies with 100 or more employees provided medical coverage. By 1995, only 77% were doing so. The growing number of uninsured people gives politicians more ammunition for more programs to force more costs onto insurance companies, and to push the price of insurance still higher.

Once again, the politicians are seizing the opportunity to save us from their own handiwork.

Over and over it is demonstrated that when government becomes more involved in an industry, that industry becomes less efficient, less responsive to market forces, and services suffer while prices go up. That is why our founding fathers designed a system where government would not have the authority to even think about doing what it does today- they knew that having government run health insurance companies, auto companies, banks, home loan companies, alternative energy companies, and all the other companies that the government now runs would only result in a poorer society.

Government is the reason why healthcare is expensive- the solution is in every way possible less government. Not a lot more government, not a little big more government, not even the same amount of government- the solution to healthcare costs is less government. LESS GOVERNMENT.

Pivoting away from other issues like the environment ("Bombshell" Experiment: Global Climate Change Caused by Cloud Cover) or education (More Than 200 D.C. Teachers Fired! Progress?), let's return back to jobs and the role that the government plays in job creation.

In my post Coming To Grips With a Political Economy I wrote about a class that I took in college called 'Political Economy.' The class was an attempt to indoctrinate students with the idea that government could create jobs through its actions and could create wealth through proper regulation and control over free markets. I struggled through this class, mostly because I rejected entirely the idea that government can create wealth and jobs through its actions, and today I still believe that.

Government does not create jobs. It takes wealth from those who are productive and creating wealth, cycles it through many layers of bureaucracy and 'management', and then gives that wealth to those people who are favored by the government. Some of those who are favored by the government should be- the Constitution identified those who the government can give 'jobs' to and states further have identified those who the government should give 'jobs' to. But many others who the government gives 'jobs' today in America are simply those who benefit from the kind of crony capitalism and banana republic policies that are more common to two-bit dictatorships and tyrannies.

And the 'jobs' that are created by government are inefficiently created- much wealth and property is squandered and lost and burned by having government provide these jobs because of the many layers of 'management' and bureaucracy that mark the government. This is an acceptable price to pay for fire, police, and military jobs, but for most other 'jobs' the government creates the cost to create these jobs far exceeds the useful good that these jobs provide to society.

For example, many liberals claim that Obamacare will 'create jobs'- agencies and regulatory bodies that will hire overlords and masters who supervise a once-free and vibrant economic sector and regulate, tax, and control it. But the cost of these jobs was demonstrated graphically by the reaction that businesses had to it- after the passage of this law businesses dramatically dropped their hiring of workers. The Heritage report explained why this happened:

Businesses with fewer than 50 workers have a strong incentive to maintain this size, which allows them to avoid the mandate to provide government-approved health coverage or face a penalty; Businesses with more than 50 workers will see their costs for health coverage rise—they must purchase more expensive government-approved insurance or pay a penalty; and Employers face considerable uncertainty about what constitutes qualifying health coverage and what it will cost. They also do not know what the health care market or their health care costs will look like in four years. This makes planning for the future difficult.

Yet President Obama and the modern-day Democratic Party continues to think that regulations, spending, taxes, and control over free people can 'create jobs'. They take wealth from those who have it- either through taxes or fees or by simply sucking up savings by selling debt- and give it to those who they favor and try to pretend that they have made society better. But they haven't- they have killed legitimate jobs that millions of people through their free actions wanted and needed (the unseen hand of the market) and made society less because of their actions that took away freedom and property.

In Latest EPA Rules to Cost 1.4 Million Jobs and a 12% Increase in Utility Bills I wrote about how the Washington Post reported that the new EPA rules that were recently published will cause electric bills will jump 12 percent nationally by 2016 to comply with these new policies, with residents in areas such as Kentucky and Tennessee seeing a 24 percent increase in their utility bills. These policies are project to eliminate 1.4 million jobs- real jobs that will be destroyed by the actions of government, creating people who will no longer be paying taxes any more and will now be sucking down government benefits, all thanks to these policies pushed by Democratic bureaucrats employed by a Democratic President supervised by Democrats in the House and the Senate and supported by Democratic unions and a Democratic media.

And now Wyoming Republican Senator John Barrasso has put together a report that showed that the executive actions of the Democrat President have put in place in July alone an additional $9.5 billion in new regulatory costs by proposing 229 new rules and finalizing 379 rules. Among those rules that are going to add to the cost of doing business, kill jobs, and make our society less productive and wealthy are rules regarding the fake issues of global warming, healthcare reform, and financial regulatory reform rules.

IN JULY ALONE A DEMOCRATIC PRESIDENT PUT IN PLACE $9.5 BILLION IN NEW COSTS! I don't care how many times Obama 'pivots' to talk about jobs, the heart of the matter is that he is wrong about the government being able to create jobs and wealth through its actions- government is best that governs least because when people are free and free to live their lives and free to make their own decisions and free to do with their wealth and labor as they see fit, then jobs are created and wealth is created.

Make the choice in 2012 to turn America away from tyranny and 'government-created jobs' and to freedom and 'people-created jobs'.

For more reading, try Productivity versus OSHA and EPA regulations (Research for business decisions).

Listening to a recent speech by US President Barack Obama (Democrat) regarding the passage of the American Invents Act at Thomas Jefferson High School for Science and Technology in Alexandria, Virginia, I was bothered by way that he phrased things. Shortly into his speech, he said:

...But there are other steps that (the national government) can take. Today, for example, my (the national government) administration is announcing a new center that will help companies reduce the time and cost of developing lifesaving drugs. When scientists and researchers at the National Institutes of Health discover a new cure or breakthrough, (the national government's) going to make it easier for startup companies to sell those products to the people who need them. (The national government) got more than 100 universities and companies to agree that they’ll work together to bring more inventions to market as fast as possible. And (the national government's) also developing a strategy to create jobs in biotechnology, which has tremendous promise for health, clean energy and the environment....

....So (the national government's) going to have to make sure that (the national government's) continuing to invest in basic research so you can do the work that you’re capable of — and still pay the rent, which is important, you will find out. (ha ha, paying the bills is funny.)

(The national government's) need to continue to provide incentives and support to make sure the next generation of manufacturing takes root not in China or in Europe, but right here in the United States — because it’s not enough to invent things here; our workers should also be building the products that are stamped with three proud words: Made in America.

And if (the national government) wants companies to hire our workers, (the national government) needs to make sure we give every American the skills and education that they need to compete. (The national government has) got to have more schools like Thomas Jefferson....

...That’s why (the national government's) boosting science and technology and engineering and math education all across the country. And that’s why (the national government's) also working with businesses to train more engineers, and revitalize our community colleges so they can provide our workers with new skills and training. And, finally, that’s why (the national government's) making sure that all of our children can afford to fulfill their dream of a college education — that they can afford to go to school and that Pell grants and student loan programs ensure that they don’t come out of college with mountains of debt.

This is the economy (the national government) needs to build — one where innovation is encouraged, education is a national mission, and new jobs and businesses take root right here in America.

So that’s the long-term project.

To be helpful, I replaced the word 'we' with 'the national government' so that I could better understand exactly what Obama sees as the long-term project of change for our nation.

You see, what bothers me is that the economic philosophy that I increasingly believe that Obama is increasingly pushing in our nation is State Socialism. Wikipedia describes it this way:

State socialism is an economic system with limited socialist characteristics, such as public ownership of major industries, remedial measures to benefit the working class, and a gradual process of developing socialism through government policy.

Proponents of state socialism claim the state, through practical considerations of governing, must play at least a temporary part in building socialism. Many Socialists, such as Fredrick Engels and Saint-Simon, take the position that the state will change in nature and function in a socialist society; specifically, the nature of the state would change from one of political rule over people into a scientific administration of the processes of production; specifically the state would become a coordinating economic entity of inclusive associations rather than a mechanism of class and political control....

...Traditional social democrats and non-revolutionary democratic socialists argue for a gradual, peaceful transition from capitalism to socialism. They wish to abolish capitalism, but through political reform rather than revolution. This method of gradualism implies utilization of the existing state apparatus and machinery of government to gradually move society toward socialism, and is sometimes derided by other socialists as a form of "socialism from above" or political "elitism" for relying on electoral means to achieve socialism....

....Trotskyists believe that central planners, regardless of their intellectual capacity, operate without the input and participation of the millions of people who participate in the economy who understand/respond to local conditions and changes in the economy, and because of this criticize central state planning as being unable to effectively coordinate all economic activity....

Perhaps I'm wrong, and Obama isn't in favor of State Socialism, but I think I'm narrowing down exactly just exactly this guy is thinking for the future of America.

Juan Williams was on Sean Hannity today discussing President Obama's economic and domestic policies, and when push came to shove and facts and figures and data and evidence was cited, he fell back on the same argument that liberals and progressives always fall back on when the results of their policies prove to be harmful to poor people, minorities, and the groups in society that need the most help- he fell back on the argument that for all of the government's faults, at least it was taking wealth from rich people and redistributing it as charity to poor people.

Liberals and progressives, who have seized the old Democratic Party and are now running it as a communist organization, believe that one of the primary roles of the new United States of America is to use the power of the state to distribute charity to those who need it. But their actions and beliefs are in fact resulting in less money and wealth going to the people who need it in society because the government is THE SINGLE WORST charitable organization in the world, having considerable overhead, being motivated by politics and not need, and full of corruption and graft.

CATO, in a report that, although dated, still gets to the heart of the matter, said:

Private charities have been more successful than government welfare for several reasons. First, private charities are able to individualize their approach to the circumstances of poor people in ways that governments can never do. Government regulations must be designed to treat all similarly situated recipients alike. Glenn C. Loury of Boston University explains the difference between welfare and private charities on that point. "Because citizens have due process rights which cannot be fully abrogated . . . public judgments must be made in a manner that can be defended after the fact, sometimes even in court." The result is that most government programs rely on the simple provision of cash or other goods and services without any attempt to differentiate between the needs of recipients.

Take, for example, the case of a poor person who has a job offer. But she can't get to the job because her car battery is dead. A government welfare program can do nothing but tell her to wait two weeks until her welfare check arrives. Of course, by that time the job will be gone. A private charity can simply go out and buy a car battery (or even jump-start the dead battery).

The sheer size of government programs works against individualization. As one welfare case worker lamented, "With 125 cases it's hard to remember that they're all human beings. Sometimes they're just a number." Bureaucracy is a major factor in government welfare programs. For example, a report on welfare in Illinois found procedures requiring "nine forms to process an address change, at least six forms to add or delete a member of a household, and a minimum of six forms to report a change in earnings or employment." All that for just one program.

In her excellent book Tyranny of Kindness, Theresa Funiciello, a former welfare mother, describes the dehumanizing world of the government welfare system--a system in which regulations and bureaucracy rule all else. It is a system in which illiterate homeless people with mental illnesses are handed 17-page forms to fill out, women nine months pregnant are told to verify their pregnancies, a woman who was raped is told she is ineligible for benefits because she can't list the baby's father on the required form. It is a world totally unable to adjust to the slightest deviation from the bureaucratic norm.

In addition to being better able to target individual needs, private charities are much better able to target assistance to those who really need help. Because eligibility requirements for government welfare programs are arbitrary and cannot be changed to fit individual circumstances, many people in genuine need do not receive assistance, while benefits often go to people who do not really need them. More than 40 percent of all families living below the poverty level receive no government assistance. Yet more than half of the families receiving means-tested benefits are not poor. Thus, a student may receive food stamps, while a homeless man with no mailing address goes without. Private charities are not bound by such bureaucratic restrictions.

Private charity also has a better record of actually delivering aid to recipients. Surprisingly little of the money being spent on federal and state social welfare programs actually reaches recipients. In 1965, 70 cents of every dollar spent by the government to fight poverty went directly to poor people. Today, 70 cents of every dollar goes, not to poor people, but to government bureaucrats and others who serve the poor. Few private charities have the bureaucratic overhead and inefficiency of government programs.

Democratic policies are increasingly being defended on 'charitable' grounds, from healthcare policies to economic policies to environmental policies, but the truth of the matter is that government is a poor method of distributing charity. Instead of relying on government and its horrible charitable giving, all of these programs should be ended and the money spent on them should be returned to citizens. Even if a small percentage of this money was given in charity, then it would be more successful than government programs, and as long as there are a lot of conservative Republicans around, we can be sure that a good percentage of money will be donated and not a small percentage (according to studies, liberals don't donate to charity- they feel superior by taking money from you and giving that to charity).

President Grover Cleveland was a Democrat, and yet even he knew that though the people support the Government, the Government should not support chosen people. Recently I was reading the message that he sent to Congress after he vetoed a relief bill, and I was struck by his deep understanding of government and its proper role in our country.

The proper or correct role of government, he knew, was not to support chosen groups or individuals- federal aid to support chosen individuals or groups encourages the expectation of paternal care on the part of the Government- it changes the relationship that you have with the state from one where you are in charge of the state to one where the state is in charge of you. Further, having the government step in and provide goods and services to those people or groups it chooses to support weakens the overall sturdiness of our national character- rather than people striving to improve and be better, they sit and wait for the government to rescue them. Lastly, having the government step in and provide benefits, money, and support for chosen groups dissuades those kind and good people among us who would give charity and help out, weakening further the bonds of common brotherhood in our nation.

President Cleveland was a wise man- he knew that if the government stepped into to help out anyone who needed charity, society would be less off and not better off than it is. Providing healthcare to the poor, extending unemployment benefits, paying for college, running readings programs for Spanish-speaking citizens, and providing jobs to people is not the proper role of government. I understand the desire that people have to want to help- but using the power of the state in the end creates a worse society. And it isn't just that people are taxed so much that they can no longer give to charity- it is that they are told by the government that the government is taking care of it, so they no longer should help out and be kind to their fellow man.

No one, not even the most rabid conservatives, are doubting that times are tough right now. No one is arguing that things are good. This isn't about conservatives being greedy, or racist, or evil- it is about the proper role of government in society, and creating a happier, more prosperous, more free society.

Our Founding Fathers knew this, and President Cleveland knew this as well- that the Constitution was put together with much thought and care by decent men and that it is not the power and duty of the Government to be extend to relief to individuals who are suffering. This is something that is properly related to the public service or benefit. We should steadily resist as a nation any tendency to disregard the limited mission of this power and duty. And it is important that we teach people why we are resisting this tendency- not out of any bad will, but out of understanding, trust, faith, and kindness.

I believe in America still. The friendliness and charity of our countrymen can always be relied upon to relieve their fellow-citizens in misfortune. This has been repeatedly demonstrated in our times- after hurricanes or terrorist attacks, the American people have stepped up and done more and better than our government could to help people. We need to once again unleash the American people and let them achieve their full measure- and resist the tendency to have government step in and do this instead of them.

Government should do a few things, and do them well. Government should not try to be all things to all people. Oakland County (MI) government needs to wake up and realize this.

If you need a marriage license, a death certificate, or a birth certificate, you should go to Oakland County Government. If you pay your property taxes or get a map of the county, you should go to Oakland County Government. If you need to pay a ticket, find out about the court systems, or look through campaign finances of local elected officials, go to Oakland County Government. If you want a county park or recreation area, go to Oakland County Government. Oakland County Government should be in charge of sewers, elections, roads, libraries, jails, morgues, and children's services.

But, Oakland County should not be manage an airport. It should not be in the movie making business (Office of Arts and Film). It should not be helping to sell industrial or residential properties, or listing foreclosed homes. It should not be speculating in business ventures, gambling on what kinds of industries to support with investments or tax breaks, and should not be picking and choosing winners and losers in the marketplace. Oakland County Government should not be running job placement services, or teaching people how to use a computer, or providing charity for veterans.

These are all worthy and noble efforts- but Oakland County Government should not be doing them, private businesses or private charities should, as they are better able to, provide better services, and do so more efficiently.

And Oakland County Government should not be in the business of providing healthcare to citizens. This is important, and one would hope that an employer would provide this to its employees or the healthcare would be priced so that an individual could afford it, but it is not the business of county government to provide these services.

Government should do a few things, and do them well. Government should not try to be all things to all people.

Over the summer I got in many debates with liberals who supported the government's plan to nationalize the healthcare system. One of the most frequent pieces of evidence cited to support their argument was that currently there is a lot of waste and fraud in the system, and that when the federal government runs your insurance plan, that will all be eliminated. Because the government will run such an efficient system with no waste and fraud, these liberals would argue, it will be able to provide quality insurance to high risk individuals who never paid a dime into the system.

When faced with this logic, I would laugh, and question the assumption that the government will have less fraud and waste than private companies, especially the dramatically less rates needed to fund the magic system of to each according to their needs that liberals are promising.

This week my logic is reinforced by two points. First, the U.S. Office of Budget and Management this week announced that taxpayers lost at least $98 billion through waste and fraud in fiscal year 2009. That’s up $26 billion from last year. The Medicare and Medicaid programs counted for more than half the total—about $54.2 billion. Most of that went out for erroneous payments and outright fraud. With the massive power of the federal government supporting every move, the government still lost AT LEAST $98 billion, and I bet you that the number is much much higher than that in reality (a lot of what a liberal auditing private companies would call 'waste and fraud' is not counted when it is the government doing it). Oh, and amount of waste and fraud is not going down after the election of 'make government more efficient' and 'get rid of the special interests' Barack Obama to President- it is going up, almost as if Obama is doing the exact opposite of everything he promised to do and yet exactly the stuff I predicted he would do.

The other interesting story this week is that the according to the best and the brightest people in our nation's government, publishing official statistics meant to demonstrate the competence and transparency of the best that government has to offer, over $6.4 billion in stimulus money had been spent in hundreds of nonexistent congressional districts. That's right, the federal government 'created and saved jobs' and spent stimulus money in districts that don't exist (like Puerto Rico's 99th Congressional District). Joe Biden says it isn't a big deal- that the numbers the government published were totally made up and had no basis in reality, so don't get upset about it. But that doesn't comfort me and demonstrate to me that government can run a more efficient, less corrupt, less fraudulent, and less wasteful operation than private industry.

The very foundations of this healthcare bill are called into question every day using logic and common sense, and to be perfectly honest, it doesn't matter. The bill that the Democrats are producing could be proved to do everything that conservatives say it is going to do, and Democrats and Obama would still support it. Because its intent is not to make health care costs go down (in fact, it will make them go up) and it is not to cover more people (most people will lose coverage under their old plans), but the whole point of this healthcare bill is to expand the government power over your life. They want to control your life. They want to control your liberty. And they want to control your property. Government is, as it has always been, the biggest threat to your natural god-given rights, and we can see that today in the Obama administration backed by Democratic Congressman.

Today I read a great article in National Affairs called "Capitalism After the Crisis." It discusses what is happening to the idea of capitalism after the recent economic crisis, and makes some very important points. One of the most important ideas is that the idea of capitalism is dying today, but not because of it's failures, but instead because we are turning away from capitalism:

When the government is small and relatively weak, the way to make money is to start a successful private-sector business. But the larger the size and scope of government spending, the easier it is to make money by diverting public resources. Starting a business is difficult and involves a lot of risk — but getting a government favor or contract is easier, and a much safer bet. And so in nations with large and powerful governments, the state tends to find itself at the heart of the economic system, even if that system is relatively capitalist. This tends to confound politics and economics, both in practice and in public perceptions: The larger the share of capitalists who acquire their wealth thanks to their political connections, the greater the perception that capitalism is unfair and corrupt.

Under Democratic-control and influence, America is increasingly becoming less a company where your fortunes are defined by what you do, and is increasingly becoming a nation of who you know- who your political connections are, who is giving you grants of taxpayer money, who your parents are, etc. If you have a million dollars now, the best way to turn it into two million is not to work harder and develop a better product- it is to lobby government to have government help protect your product from competition, or to give you a government contract, or to help you in some other way. Our nation is becoming corrupt under Democrats and corruptible Republicans.

Think about what is going on today, especially in the debates regarding healthcare and energy. Supporters of government control of these areas of the economy talk about all the failures of these 'private capitalist systems'- but over the past decades, energy production and healthcare have become amoung the most non-private non-capitalist systems in our economy. The soda-pop market or movie business does not have the same problems as transportation, energy, healthcare, etc- and the difference is not that these problem areas are more capitalist, it is that they are less capitalist.

The problem with healthcare is not not enough government, it is too much government. The problem with energy is not not enough government, it is too much government. The problem with transportation is not not enough government, it is too much government. The problem with education is not not enough government, it is too much government.

The sad thing is, America might have turned the corner towards statism and corruption, and what once made us exceptional may have been lost forever:

Once economic and political systems are built to reward relationships instead of efficiency, it is very difficult to reform them, since the people in power are the ones who would lose most in the change.

One way to possibly make America exceptional again is to remember how we got here. When your children read stories or watch movies, what sort do they read or watch?

The image many Americans have of capitalism is therefore that of Horatio Alger's rags-to-riches-via-hard-work stories, which have come to define the American Dream. By contrast, in most of the rest of the world, Horatio Alger is unknown — and the image of social mobility is dominated by Cinderella or Evita stories: fantasies more than plausible dreams.

Are your children taught to win the government lottery? To win riches by being a professional athlete? To go to Hollywood and star in movies? To marry someone rich? Or are you teaching your children that the way to success in life is hard work and a good attitude? And is our society still reinforcing those teachings by rewarding hard work and a good attitude more so than luck and connections?

Read the whole article- I'm only pulling from a tiny portion of it, but the whole thing is indeed a good read.

John Locke said that the purpose of government is to protect and enforce our natural rights, mainly our right to live, our right to live free from interference in our lives, and our right to earn and keep property. Here is his argument, shortened for time. Imagine that you live in a state of nature, a place where there are no laws or government. If someone killed you, it wouldn't matter if there were no laws, because it would be wrong- that means that there are rights that exist before and after government. If you went to Mars, and there were no laws, and someone put you in a cage, that would be wrong- they would have violated your natural right to liberty. And if you go into the middle of outerspace and someone robs you, that would be wrong, because your right to earn and keep property existed before government was ever around and exists even if government isn't there. These rights do not come from the government, and it is not the lawful creator or destroyer of those rights.

So, continuing the lecture, given that we have these natural rights, and given that in a state of nature they may be inadequately protected, the rational thing to do is to agree (ie, to consent) to give up our right to enforce our rights to a government, which will be better able to protect these rights. We do not give up our natural rights- we simply give up the power to enforce them. Therefore, the only reason why government exists is to protect your rights to life, liberty, and property.

That is not to say that government should do nothing. One could convince me that providing a bare-bones safety net of welfare (food stamps or medical care) helps to protect life. One might be able to convince me that liberal rights for criminals could better protect my liberty. And one might even convince me that paying for fire and police services help to protect my property better. As you can see, I'm not a fringe nut- I'm more of a Reagan Republican. That being said, think about what government does right now, what Obama wants government to do, and what your Congressman votes for government to do- do they believe that the purpose of government is to protect your life, your liberty, and your wealth?

Obama is going to give a State of the Union address tomorrow- I predict that in it, he is going to talk about how the government can take more of your property (or some other sovereign individual in our nation), control more of your liberty (or someone else's that you may or may not know), and quite possibly might let slip that he is changing the rules regarding the valuing of human lives (pro-choice and all that stuff).

Call up your Congressman and ask him if he believes that the sole purpose of government is to protect your life, liberty, and property. He better say "heck yah!", or else you better donate to his opponent next election and knock door-to-door so that you can throw him out of office.

Listen to a great interview with 760 WJR's Frank Beckmen as he speaks with Amity Schlaes, Senior Fellow for Economic History at the Council on Foreign Relations, about Obama and if he is repeating Roosevelt's mistakes, and you'll see why I am getting so upset about property rights violations by the Obama administration.

Life, liberty, and property. Remember those words.

When discussing interest groups in my government classes, I always try to bring up the Tobacco Master Settlement Agreement as an example of how interest groups and government can work together to create laws that benefit both of them. The tobacco settlement is a good example of a way that the government can try to regulate things in our society that are viewed as harmful, and many people think government should try to use this sort of an agreement as a basis for similar agreements between the government and any industry that supposedly does something harmful.

That's not my view of this agreement. I view the Tobacco Master Settlement Agreement as the tobacco industry trading liability for protection, and paying money to make the government force competitors out of business. I view the TMSA as government-endorsed thuggery, the collusion between the four biggest tobacco companies and the government, setting up a marketplace much the way the mob does where the government only allows certain people to compete, and only then at a price, and in return for that price they are not responsible for the harm their products produce and do not have to worry about competition.

Go back a couple years ago and read this article from Reason Magazine called Puff, the Magic Settlement.

This just isn't old history. Today Jonah Goldberg in an article called 'Big Business' Democrats reminded me of this agreement. The TMSA is viewed as a model of success by many to emulate. They think that if you sit Big Business and Big Government down at the table together, magically Big Business will pay millions of dollars in damages and no longer cause problems. They don't realize that there was a deal made, and the deal was to screw over the American public so that both Business and Government would win.

Cap-and-trade is a similar agreement to the one the tobacco industry struck. The winners are big energy businesses, the losers are the people. In this agreement GE and other major energy companies stand to make billions from carbon pricing, thanks largely to investments in technologies that cannot survive in a free market without massive subsidies from Uncle Sam. GE chief Jeffrey Immelt cheerleads big government as "an industry policy champion, a financier and a key partner."

Healthcare is a similar agreement to the one the tobacco industry struck. The winners are big healthcare businesses, the losers are the people. The healthcare industry has mostly been trying to cut insider deals with the government, not fighting to defend the status quo, and if the healthcare bill goes forward, Big Pharma and Big Hospital will have figured out a way to transfer billions of dollars to them and keep them safe from competition, while politicians will cheer what they call 'reforms.'

The backbone of America is freedom to enter the marketplace and protection of property from unjust takings. But when Big Business and Big Government work together, the Big Loser is America.

This post is going to attempt to tie together commentary of FDR, Green Jobs, the Michigan 21st Century Investment Fund, and Jeff Daniels... I hope it makes sense.

As a teacher, I always become annoyed when students repeat the myth that FDR saved us from the Great Depression. It is now such a widely accepted myth that when I voice my doubts, the students think that I must be joking. It is like claiming the world is flat they think- after all, look at all the jobs that FDR created to fight the Great Depression. Look at all the never-done-before government actions, and the massive expansions in federal power that he shoved through during an unprecedented 4 terms in office. Surely he saved us, because after all, massive government action must be good, right?

Wrong. It is a myth that FDR saved us from the Great Depression. Excellent information this can be found in the essay Great Myths of the Great Depression. In fact, FDR's New Deal program was an economic failure that likely stretched a usual downturn in the economy (albeit a bad sharp one) into a depression that the US did not truly emerge from until after FDR was dead. Roosevelt’s formula of substituting government programs for a normal business recovery did not create the high unemployment. FDR's idea of extracting tax dollars from individuals and corporations to fund government programs such as the Works Progress Administration (WPA) was a bad idea. The WPA hired workers to pick up trash, cut down trees, and build roads, bridges, and schools- but even though the government was 'creating jobs,' in reality they merely transferred jobs from the productive private sector to the inefficient public one. For more yet, see this site.

This myth does not die though. In Michigan, our government has dramatically increased the amount of money that it spends on two 'job creation programs' that are the centerpiece of Granholm's economic recovery program for Michigan. In fact, during her campaign, these two 'job creation programs' featured prominently, and obviously people bought this myth, because she won re-election over a real job creator in Michigan, Republican Dick DeVos. As michiganliberal.com put it "Granholm announced the creation of funding for new companies that will help diversify our economy and keep people and ideas in this state," buying into the myth that the government can tax productive companies and then somehow create jobs with that money.

In reality though, government can not create jobs, it can only force people from productive private sector jobs to inefficient public sector jobs. An article in the Detroit Free Press described how tax dollars in Michigan (where taxes have been steadily been raised) were used by two state programs, the Venture Michigan Fund and the Michigan 21st Century Investment Fund, to try to help bring new jobs to Michigan. These programs were created because Democrat Governor Jennifer Granholm and liberal state lawmakers believed that they could create jobs using the power of the government. The result?

According to the research, Michigan's government spent 116 million dollars and to create 40 new Michigan jobs over the last two years - at the cost of almost $3 million per 'created' job! What's even worse, liberals and government has reached the wrong conclusion- they think that this is a success (the headline of the Free Press article- 'State Venture Capital Funds Start Paying Off'). Thank you to the Michigan Taxpayers Association for staying on top of this one.

So what sent me off on this long rant and prompted me to spend 30 minutes coming up with this post? Those annoying commercials I have to listen to that are narrated by Jeff Daniels! The Michigan Economic Development Corporation has a whole library of video's that they run on TV and the radio that they have put together to tout the myth of government creating jobs. The most annoying of these are the ones that claim that the MEDC is doing great things when it uses massive amounts of taxpayer money to lure environmental companies here, and by doing so somehow creates jobs. Michigan is now fully behind the myth of government job creation- even worse, it is buying in more and more into the more specific myth of green jobs.

John Stossel destroys this myth in his recent article "The Fallacy of Green Jobs." I'm going to pull from it and edit it below:

Democratic presidential candidate Barack Obama has a great twofer pitch: "green jobs." It sounds like a winner. Politicians always promise that their programs will create jobs. The fallacy is the same in every case: Even if the program creates jobs building bridges or windmills, it necessarily prevents other jobs from being created. This is because government spending merely diverts money from private projects to government projects.

Governments create no wealth. They only move it around while taking a cut for their trouble. So any jobs created over here come at the expense of jobs that would have been created over there. Pharaohs created thousands of jobs by building pyramids. Our government could create jobs by paying people to dig holes and then fill them up. Would actual wealth be created? Of course not. It would be destroyed. It's like arguing the hurricanes create jobs. After all, the destruction is followed by rebuilding. But does anyone seriously believe that replacing destroyed buildings creates wealth?

Look at Obama's plan- it wholeheartedly buys the myth. If "green jobs" make so much sense, the market will create them. They will be created by private entrepreneurs and venture capitalists who are eager to profit from winning investments. The best ideas will rise to the top, and green energy will gradually replace coal and oil. If politicians were serious about creating jobs and cleaner technologies, they would step aside and let the free market go to work.

The last thing I want to leave you with is the Broken Window Fallacy, as spelled out by French economist Frederic Bastiat. He pointed out that a broken shop window will create work for a glassmaker, but that work comes only at the expense of the cook or tailor the shopkeeper would have patronized if he didn't have to replace the window. Government taxing tax money, cycling it through inefficient bureaucracies and vast overhead, and then trying to build things inefficiently that the market is not does not create jobs- it destroys jobs.

Need proof- during the Great Depression, FDR's unemployment rate hovered around 15%. And in Michigan, under liberal Democrat Granholm's administration and her government-jobs creation program, Michigan has lurched into a one-state recession and had it's unemployment rate climb from 3.7 to 7.2%.

According to a recent USA TODAY analysis of federal salary data, the number of federal workers earning six-figure salaries has exploded during the recession. Not gone up a bit, not grew at a reasonable and steady rate, but exploded. Federal employees making salaries of $100,000 or more jumped from 14% to 19% of civil servants during the recession's first 18 months — and that doesn't even include overtime pay and bonuses, which for some reason count as pay for executives but don't count as pay for civil servants.

Federal workers are enjoying an extraordinary boom time — in pay and hiring — during a recession that has cost 7.3 million jobs in the private sector. The highest-paid federal employees are doing best of all on salary increases. Defense Department civilian employees earning $150,000 or more increased from 1,868 in December 2007 to 10,100 in June 2009, the most recent figure available. When the recession started, the Transportation Department had only one person earning a salary of $170,000 or more. Eighteen months later, 1,690 employees had salaries above $170,000.

The USA TODAY analysis doesn't lay any blame to any particular party for this explosion in government jobs and pay, but the start of this boom time for government employees was 2007... right after Democrats took control of Congress, and since Obama's election to President, the hiring and raising of pay for government workers has risen sharply.

The USA TODAY analysis also doesn't advance that there is any sort of relationship between the recession and the boom in government jobs and pay, but I will voice that- the recession in our nation is partly attributable to the growth in government pay and jobs. Talented employees are being lured into inefficient and non-productive jobs in the government, and instead of producing products of value for society are instead regulating and taxing productive produces of value for society at ever increasingly rates. In Michigan, we watched the size of government grow and grow and grow, and the recession get worse and worse and worse, and no one ever put the two together- now we see it nationally- if you grow the size of government, you shrink the size of the productive workforce. And to pay for all these government workers, the government borrows money, which soaks up available funds for investment in the private marketplace, further dragging down the nation.

Today we read about how the Democrats in the government are attacking the pay of executives and businessman across the nation, as unelected and unconfirmed bureaucrats arbitrarily decide who gets 'paid to much' according to their nebulous unaccountable judgement calls. And yet Democrats are dramatically increasing the pay of government employees, raising caps on top administrators pays and pushing for more and more pay for government employees. This type of behavior- hypocritical, unethical, and illegal- marks tyrannies and corrupt institutions around the world, and is exactly what the Democrats are advocating.

Democrats believe you should make nothing but their politically connected friends should make more and more pay, and the numbers prove it- in the midst of a recession made worse by Democrat policies, the only people who have dramatically increasing pay and work are government workers.

Representative Jason Chaffetz, a Republican from Utah, said it best- "There's no way to justify this to the American people. It's ridiculous."

Today (July 9) a new nation was created, the nation of South Sudan. South Sudan became an independent state on 9 July 2011 at midnight (00:00) local time following a referendum held in January 2011 in which nearly 99% of voters opted for separation from the rest of Sudan. It has been an Autonomous Region of Sudan or at war with Sudan on and off since 1972, and now is finally its own nation. Sudan has recognized it, and so has the United States, it has ratified a Constitution, and now it is busy forming up its government.

Although I have few readers from Africa, perhaps I might have a couple from South Sudan, and so in that spirit I would like to pass on some advice on how to form a successful state.

People are very powerful, and by giving them as much freedom and liberty they will demonstrate their power by creating a prosperous economy, a strong military, and a vibrant civil society. The biggest obstacle to people is an active and large government that takes away responsibility and freedom from the individual, acts as a barrier to innovation and risk-taking, and sucks all of the money out of the system for projects that elites (government agents) deem important. It is my suggestion that any government created by South Sudan have a healthy respect to the dignity of human life, truly believe in the power of liberty and freedom, and work to put in place strong rule of law that protects above all the fruits of ones labor (private property).

A new nation must put in place barriers to itself, checking itself by separating power between different branches of government and then creating checks between branches to limit the abilities of each to overreach and act in a tyrannical manner. It also helps if the nation limits itself further by separating power between a national government designed to address national issues and local governments designed to address local issues, much like our fading federal system here in America.

Although I no very little about this nation so far, it appears that the current President Salva Kiir Mayardit has a chance to be a good one- a former general who was unambiguous about being free, if he can limit himself and set important precedents in his office than he will be a great one. Most nations that achieve independence get stuck with the first President for a long time as that person eventually becomes a dictator- Kiir needs to recognize that what made George Washington great was that he served his nation for two terms and then left office, turning over power peacefully. It is bothersome that he is so closely associated with the military, and that the legislative assembly is so weak and completely controlled by his party, but I have hopes for him, especially if he is a regular reader of my blog.

It is also not a good sign that the nation is so dependent on oil, especially when these oil resources are largely being developed by foreign companies, especially the Chinese government. One hopes that the government will use the ample oil revenues it receives to fund a limited government that will engage in national defense (not war), control its border, and distribute funds to local governments to put in place police and fire services, build libraries, and support transportation and education services. With the amount of revenue that oil provides, there would be little need to borrow abroad or tax its citizens or companies within, and this low tax and low regulation environment would be an engine of economic development that will eventually lead to a more diverse and prosperous economy. Note I did not suggest that the government use its oil revenue to provide a social safety net or redistribute wealth to poor people- a free and prosperous people will do that better than any sort of forced charity that the government could ever do.

Good luck South Sudan- I hope you take my advice and create a government for the people, by the people, that serves the people, in the spirit of life, liberty, and protection of property.

See the memeorandum story for more details on this new nation.

UPDATE: I really didn't want to make this a political issue, but I did see something interesting over at Ace of Spades...

Christian groups had been championing the southern Sudanese since the 19th century. And their efforts paid off in 2000 when George W. Bush was elected president of the United States. He elevated Sudan to the top of his foreign policy agenda, and in 2005, the American government pushed the southern rebels and the central government — both war weary and locked in a military stalemate — to sign a comprehensive peace agreement that guaranteed the southerners the right to secede. On Saturday, one man held up a sign that said "Thank You George Bush."

Last week I wrote in my post Lessons from Economic Recessions- Introduction and Great Depression:

History teaches lessons- it allows those of us in the present to see how results in the past worked. Economic recessions are a great teaching tool for policy makers and average citizens, because they teach us how the recession may have happened and how to emerge from the recession and therefore inform us as to the policy actions that we must take and those that we as citizens must support.

In that post, I talked about the lessons from the Great Depression. The lessons that I drew from the Great Depression are based though not on just data from that event, but from other recessions that our nation has entered and exited. Most liberals simply say 'government spending got us out of the Great Depression', but when I ask them about all of the other recessions that the United States entered, they have a blank look, as they do not have any knowledge of other recessions or how we emerged from them as a nation.

One of my friends in the media should try this sometime- ask a liberal policy maker- President Barack Obama, or Nancy Pelosi, or Carl Levin, or Debbie Stabenow, or Gary Peters- ask them what lessons they have personally learned from the Great Depression. I am sure they will roll off some long-winded answer that sounds educated and learned but basically boils down to 'spend more money.' Follow-up that question with a question on what lessons they learned from the Depression of 1920-21, or The Panic of 1907, or the Long Depression of 1873–79, and you'll be sure to get blank looks from these policy makers, as they don't have any knowledge about those recessions and have learned no lessons from them. They might even snap back some response to you about how unimportant it is to learn about other recessions- but they are wrong, because if you only draw your lessons on economic policy from one recession, the Great Depression, and your lessons are wrong at that, than you are sure to be wrong about very big and important policy decisions that have real effects on our nation.

Of course, my blog should not be the source for your education- I would advise you to spend some real time studying some real economists- but at least the knowledge that I display here and the lessons that I draw here are likely more educated than those of the above policy-makers, including our Harvard-trained President of the United States. So let's discuss today the The Forgotten Depression of 1920.

The Depression of 1920–21, which was an extremely sharp deflationary recession in the United States that lasted from January 1920 to July 1921, which at 18 months in duration is longer than any of the recessions after WWII, and which saw a GDP decrease of anywhere from 3% to 7%. The recession of 1920–21 was characterized by extreme deflation- anywhere from 13% to 18% — the largest one-year percentage decline in around 140 years of data. Unemployment jumped anywhere from 4 to 6% in one year, the AT&T Index of Industrial Productivity showed a decline of 29.4%, and stocks fell dramatically during the recession. It was a very bad recession that led many in society to question the stability and future of the American system of capitalism.

At the time, Secretary of Commerce Herbert Hoover — later President Hoover- urged President Harding to consider an array of interventions to turn the economy around. Hoover, as we all know now, was a progressive Republican who believed that active government response by government officials who were smarter than the rest of us could shorten a recession and led to economic growth. Hoover advocated the same policy responses in 1920 that he implemented in 1929- increased spending by the government, increased taxes especially on the evil rich, increased regulation of businesses, bailouts for banks and 'too big to fail' companies, continued support to labor unions, and more government agencies and boards to organize and improve our existing economic system.

As you can see, the responses that Hoover advocated in 1920 and implemented in 1929 are very nearly the same policies that President Obama implemented in 2009. The results of these policies are seen today and were seen in 1929- but not in 1920 because President Warren Harding ignored Hoover and did the exact opposite as what he recommended. Whereas Hoover pushed for more government spending, Harding decreased it; when Hoover wanted more regulation, Harding put in place less; for every board of smart elites that Hoover proposed to control human action, Harding cut boards and agencies so that the common man could be more free; and Harding ignored demands to raise taxes and instead slashed taxes.

The result of Harding's more conservative approach to the severe recession of 1920-1921? The recession ended quickly and ushered in an amazing period of robust economic activity the continued throughout the 1920's as Harding and Coolidge continued conservative policies. It is no surprise that the limited government, balanced budget, low taxes, low regulation, and unleashing of human freedom led to the Roaring Twenties, an amazing period in American history of social, artistic, and economic dynamism, while the active government, increased taxes, massive government spending, and more regulation of the progressive Hoover and liberal Roosevelt led to the Great Depression.

Thomas E. Woods (author of The Politically Incorrect Guide to American History, Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse, and Rollback: Repealing Big Government Before the Coming Fiscal Collapse) recently wrote a great post on this subject called The Forgotten Recession- I advise you to read the whole article, but here are several important pieces of it:

...It is hardly necessary to point out that Harding's counsel — delivered in the context of a speech to a political convention, no less — is the opposite of what the alleged experts urge upon us today. Inflation, increased government spending, and assaults on private savings combined with calls for consumer profligacy: such is the program for "recovery" in the 21st century.

Not surprisingly, many modern economists who have studied the depression of 1920–1921 have been unable to explain how the recovery could have been so swift and sweeping even though the federal government and the Federal Reserve refrained from employing any of the macroeconomic tools — public works spending, government deficits, and inflationary monetary policy — that conventional wisdom now recommends as the solution to economic slowdowns. The Keynesian economist Robert A. Gordon admitted that "government policy to moderate the depression and speed recovery was minimal. The Federal Reserve authorities were largely passive.… Despite the absence of a stimulative government policy, however, recovery was not long delayed."...

...There was nothing at all unusual about the pattern of American wealth in the 1920s. Far greater disparities have existed in countless times and places without any resulting disruption.

In fact, the Great Depression actually came in the midst of a dramatic upward trend in the share of national income devoted to wages and salaries in the United States — and a downward trend in the share going to interest, dividends, and entrepreneurial income. We do not in fact need the violent expropriation of any American in order to achieve prosperity, thank goodness...

...Harding's inchoate understanding of what was happening to the economy and why grandiose interventionist plans would only delay recovery is an extreme rarity among 20th-century American presidents. That he has been the subject of ceaseless ridicule at the hands of historians, to the point that anyone speaking a word in his favor would be dismissed out of hand, speaks volumes about our historians' capabilities outside of their own discipline.

The experience of 1920–1921 reinforces the contention of genuine free-market economists that government intervention is a hindrance to economic recovery. It is not in spite of the absence of fiscal and monetary stimulus that the economy recovered from the 1920–1921 depression. It is because those things were avoided that recovery came. The next time we are solemnly warned to recall the lessons of history lest our economy deteriorate still further, we ought to refer to this episode — and observe how hastily our interrogators try to change the subject....

Read the whole article- the logic, the understanding, the theories, and the explanation are all in there, and go into economic terms and theories that I am only beginning to gain an understanding of.

The lessons that I drew regarding the Great Depression are supported by the lessons that one can learn from the Recession of 1920-1921- that economic recessions are worsened and lengthened by a government that takes away human liberty, treats people as numbers to manage, takes wealth and property from those who have earned it, and that in every other way violates the Founding Principles of our nation (limited government, federalism, and separation of power). It is up to policy makers to learn those lessons and to vote accordingly on future legislation facing our nation.

Keep reading my blog regularly for future posts on this subject, and I continue becoming educated and drawing lessons from other past economic recessions that our nation faced and overcome.

As Daniel Howes says in his latest Commentary- Federal control of General Motors is game changer. You might know that GM is being 'bailed out' by the federal government- you might be upset that the government is taking a larger role in businesses in our country- but you might not realize how different and revolutionary the federal takeover of GM is.

(The Executive Branch of the US Government will now control) 50 percent of General Motors Corp. with the United Auto Workers set to gain another 39 percent of the automaker. The feds would select GM's directors, effectively giving this White House (and the others to follow) control over GM's strategic direction, top management and even high-level product decisions. That's just the beginning.

With or without bankruptcy, a Government Motors partnered with the UAW would be a whole new model for the global auto industry, a nationalized company whose labor union owners would be bargaining with themselves, their interests in positive cash flow to finance retiree health care obligations colliding with political interests to preserve wages and benefits.

Government Motors could be a bulwark of infinitely patient capital married to major stakeholders whose goals aren't shareholder return, operational efficiency and market penetration but the social goals of maximized employment, environmental trend-setting and political (damage) control.

"It is not our desire to either own or run one of the auto companies," White House Press Secretary Robert Gibbs said Monday. It may not be, as if saying so makes it so, but that's the practical effect.

Daniel Howes goes on to talk about how this is going to change the game for everyone, not just GM. How is a company like Ford supposed to compete with Government Motors- whenever they produce a better car, they have to worry that the government is going to subsidize cars produced by GM- or let's say the Ford F-150 does really well- maybe the government will get upset and pass laws that make the Ford F-150 'environmentally' incorrect? There are conflicts of interest all over the place with this arrangement, and no one is going to win.

No one, no country, has ever nationalized an industry in this manner- it is shocking. Not only that, but the deal that the government is forcing GM to take is also a mobster deal- the banks (who GM owes money to) and the shareholders (who invested in GM by buying its stock) get nothing out of this deal, and instead ownership of the company goes to the labor union and the government. This is organized looting of private companies by mobsters.

And all of this for what? To produce cars that are not competitive? To operate factories that are too expensive? To prop up a failing whip-and-buggy industry? It's not like this is the GM of years ago- this is a company already destroyed, already shed of jobs and capital and industry- we are sacrificing our morals, beliefs, and ideas about the role of government society to save the dried up dead husk of an industry that has seen its best days already. That deal, made in this manner, is shocking.

Those who voted for Change last election- all those who failed to vote Republican for President/Congress/County/local- you're getting it- nationalized Government Motors competing and driving private companies out of business all for the benefit of politically connected people in our nation. That is change that I can't believe is happening in the United States of America.

This is the title from Tom Mullen's latest blog post "A Nation of Hyenas." As he says, he was inspired by watching Wild Kingdom, in which the cheetah caught and killed some food, and then a bunch of hyena's came and took the property away. Why? Because there were more of them, and they were bigger and stronger. Later that night, while watching a heated exchange between a liberal and a conservative on TV, Mullen heard the liberal give the justification for the government having the power to take away property, possess banks and auto companies, and force me to go to their schools and hospitals:

“That’s why we have a democratically-elected government and the people want the government to do something.”

It is the horrifying reality of what any government bailout or other redistribution of wealth represents. We as Americans have forgotten that all government action is exercised under exactly these circumstances: at gunpoint. That is the purpose of government, to exercise brute force on behalf of its constituents when it becomes necessary to do so. That is why our government was originally so limited. The founders of our nation believed that brute force was only justified in self defense. Therefore, government action was limited to protecting its constituents from harm by other people, whether it was harm by a fellow citizen or a foreign army.

The first philosopher to really grapple with this issue was a guy named Thomas Hobbes. He said that humans are brutal people, who when left to their own devices will take other people's property, lives, and freedom. The only way to control such a brutal creature as man is to create an even more powerful and brutal government, one that will control him and keep him in line. The problem though is once you create a brutal and powerful government, how do you control that very government so that it doesn't take away life, liberty, and property?

Our founding fathers thought that a combination of separation of powers, federalism, checks and balances, limited government, and a religious civil society would do that. Sadly, years of liberal rule has eroded these founding principles, and now we are left only with the unrestrained brutal all powerful government- a hyena who will gang up on you and steal your property.

Rina Okonkwo writes about the genesis of corruption in Nigeria:

When did corruption in Nigeria begin? In the words of a colonial government report of 1947, “The African’s background and outlook on public morality is very different from the present day Briton. The African in the public service seeks to further his own financial interest.” The colonial report concluded that only public opinion could deal with corruption. The problem was that there was no responsible public opinion to check corruption in Nigeria.1

From as early as 1947, commissions of inquiry were held to investigate cases of corruption. The purpose of the inquiries was to expose wrong -doing and to punish the culprits.

Today, we hear much of the rampant corruption at the local government level. As early as 1955, just seventeen months after the inception of Igbo-Etiti District Council in May 1954, the colonial government held an inquiry into the affairs of the Council. The inquiry judged that the “conduct of the Council’s affairs had become a public scandal.” The colonial officer who conducted the inquiry, FP Cobb, noted, “public indignation was widespread and strong.” 2 The public was outraged at the corrupt behaviour of their representatives.

The report on Igbo-Etiti District Council revealed that there was ‘systematic corruption” in the appointment and promotion of staff and in the awarding of contracts. Bribes of L80 to L100 were demanded for unnecessary appointments. The brother of the Secretary to the District Council was hired above a more qualified applicant. In one case, a man paid a L400 bribe to secure a post and was never refunded his money when he did not get the job.

Contractors routinely paid ten percent of the value of the contract as bribe. The contracts were not awarded to the lowest bidder or to the most experienced or competent persons. At the end of its first seventeen months of existence, the Igbo-Etiti District Council was L6000 in debt. There was great wasting of public money due to “gross dishonesty in handling council affairs.”3

The local government councils have continued to be notorious for corruption. Why do such grassroots organizations attract such widespread graft? The people are often not prepared to undertake public office. They have no training in the procedures and ethics of public service. They have minimal education. There is poor supervision of the affairs 9of the Local Government Councils. The history of corruption in local government councils can show no change for the better.

In 1956, the Foster-Sutton Tribunal investigated the Premier of the Eastern Region, Nnamdi Azikiwe for his involvement in the affairs of African Continental Bank (ACB). Under the code of conduct for ministers, a government officer was required to relinquish his holdings in private business when he assumed public office. The Foster-Sutton Tribunal felt that Zik did not severe his connections to the bank when he became a Minister. The Tribunal believed that Zik continued to use his influence to further the interests of ACB.

Zik, his family, and the Zik Group of Companies were the principal shareholders of the African Continental Bank. ACB loaned over L163, 000 to the Zik Group of Companies at low interest. The Zik group did not have to repay the loans until 1971. ACB was a distressed bank. The new registrar of banks in 1952 refused to grant ACB a license. Attempts to find partners for the bank in Britain failed because of the insolvency of the bank.
In the words of a colonial government official, “Were a UK minister to be involved in a series of transactions the result of which public funds were used to support an otherwise shaky institution in which he was directly interested, he would be forced to leave public life.”4 Why did not the colonial government prosecute Zik for his failure to observe the code of conduct for government officers? The colonial correspondence revealed that the government supported the NCNC as the only party to embrace national unity. Without Zik, the NCNC would collapse. The national interest of the country demanded that Zik continue as leader of the party.5

The Governor of the Eastern Region Sir Clement Pleass further observed, “The exercise of public power for private profit is established in the East.” “The aim of the colonial government was not to establish a standard of honesty in public life. Only time and education can do that.” “A number of sensible people realized that Zik had done harm in the East in the last two years, but the mass of the people, ignorant and uneducated, voted him back to power.”6

When Zik called for a general election in 1957, as an alternative to resigning in the face of the findings of the Foster-Sutton Tribunal, the people gave him their support. The Economist observed that Nigerians had a “sunny and tolerant mentality” towards corruption.7 The colonial officer hoped that “Eventually sufficiently honest and enlightened people will be thrown up to rebuild the prosperity and good government of the region.”8

Obafemi Awolowo, the first premier of the Western Region, was found guilty of corruption by the Coker Commission in 1962. In 1954, the Western Region Marketing Board had L6.2 million. By May 1962, it had to exist on overdrafts amounting to over L2.5 million. A loan of L6.7 million was made to the National Investment and Properties Co., Ltd. for building projects out of which only L500, 000 was ever re-paid. The Western Region Finance Corporation and the West Nigeria Development Corporation also received loans of millions of pounds, which were never re-paid. The Coker Commission found Awolowo responsible for the all the ills of the Western Region Marketing Board, and Awolowo “without a doubt has failed to adhere to the standards of conduct which are required for persons holding such a post.”9

The First Republic, with Zik as the President, was marked by widespread corruption. Government officials looted public funds with impunity. Federal Representative and Minister of Aviation, KO Mbadiwe, flaunted his wealth by building a palace in his hometown. When asked where he had gotten the money to build such a mansion, KO replied, ”From sources known and unknown.” Minister of Finance Chief FS Okotie- Eboh responded to charges of accumulation of wealth by government officers by quoting from the Bible, “To those that have, more shall be given. From those that do not have, shall be taken even the little they have.”10

Azikiwe did not surround himself with men of good character. Chinua Achebe maintained that the political thought of both Awolowo and Azikiwe was based on politics for material gain. Achebe quoted from the autobiographies of the two men to show that making money and living well were primary goals in life for both our nationalist leaders. “If we were a more discerning people, we should not have trusted them with our lives even in the fifties and sixties.”11


The popular acceptance and even admiration for corruption was highlighted in Chinua Achebe’s novel about the politicians of the First Republic, A Man of the People. “The people had become even more cynical than their leaders and were apathetic into the bargain. “Let them eat,’ was the people’s opinion . . . It may be your turn to eat tomorrow.” 12

To be continued.

Vin Suprynowic, writing in the Las Vegas Review Journal, writes:

The modern Prussian police state was built by Bismarck and others in the 19th century on a Spartan model, giving the central government vastly greater control over the individual than had ever been considered possible before.

Bismarck's program centered squarely on insurance programs designed to increase support for the ever larger and more powerful government. The program included health insurance, workman's compensation, disability insurance and old-age retirement pensions, all innovations at the time.

Starting with the model of Prussian compulsory schooling, American "educators," starting with John Dewey and Edward Thorndike eagerly imported this Prussian model to America.

Trained to accept such state control (and now the new "green" religion) in the schools for most of the past century, then made dependent on government insurance programs (Social Security, Medicare) as surely as the pimp makes sure his young ladies are dependent on the needle and the fix only he can provide, slavery to the state soon appears inescapable, even ordained by God and nature.

"It is possible that all our politics will come to nothing when I am dead, but state socialism ("Der Staatssozialismus") will push itself through," Bismarck said in 1881.

"State socialism," he called it.

We're told that for some reason we're not allowed to call the Obama-Reid-Pelosi agenda "socialism," "communism," "Marxism," "state socialism" "fascism," or anything else that might sound unpleasant.

Much as I hate to cite the tyrant Lincoln, if we call a dog's tail a leg, does it have five legs? Telling us we're not "allowed" to use an accurate label for something doesn't change what it is.

Instead of allowing General Motors and Chrysler to go through normal bankruptcies, through which new and more efficient private operators could have purchased their worthwhile assets while shedding their crippling union contracts, the two giant auto makers have now been effectively nationalized. Meantime, an unelected federal "pay czar" decides on the compensation of executives, even at supposedly private banks that have paid back all their "bailout" loans. Does that sound like the normal function of the American free market, as understood in 1910, 1960 or even 1990?

Thanks to thoroughly unconstitutional "bailouts," the federal government now de facto manages our major banks and/or credit card companies, along with our airlines and airports.

The health care bill was "sweetened" with a federal takeover of college loans. Why? You don't imagine the federal government will ever try to manipulate the behavior of college graduates, offering to "forgive their college loans" if they agree to behave in ways favored by the fedgov, do you?

"Federalizing" all these programs shifts money and employment from the private to the government-bureaucrat sector. Unionized government bureaucrats tend to belong to outfits like the SEIU, which actively back Democrat/socialists, while dispatching purple-shirted thugs to beat up black freedom-fighters handing out "Don't tread on me" Gadsden flags outside rigged Democratic "town hall" meetings.

The so-called "health reform" bill authorizes $10 billion to field 16,500 more IRS agents to collect and enforce mandatory "premiums," which we're assured are not a "tax." Providing you're a "normal" citizen with a job and house, of course. (Illegal aliens Get Out of Jail Free, as usual.)

Last week the Review-Journal mentioned in passing, in an editorial about socialist Congresscritter Dina Titus' move to facilitate the takeover of Nevada Occupational Safety and Health enforcement by the federal government, that the Constitution grants the federals no authority to regulate workplace safety within the states. One letter writer couldn't wait to write in that the newspaper was wrong: turns out the preamble to the federal OSHA law as adopted specifies that it's all constitutional, since the federal government is empowered to regulate interstate commerce, and "workplace health and safety can impact interstate commerce."

So we're right back to "If you call a dog's tail a leg, does it have five legs?" If Washington can do anything it likes because everything somehow "impacts interstate commerce," why do we have a Constitution with that two-page list of specifically delegated powers? Why not just one sentence: "Congress shall have power to do anything it figures might promote the general welfare and/or impact interstate commerce"?

Vin is right- our Constitution was written for the expressed purpose of limiting the power of the national government so that our god-given rights to life, liberty, and property would be better protected. As the federal government expands, so does its threat to your life, your liberty, and your property, and that is what our founding fathers were trying to protect us against. They wanted to unleash the best of human potential, and knew that that is best done when man is allowed to be free from the constraints of the state. Our economy is more prosperous when we are free and property is protected, and our society is more civil when people provide funds for charities rather than having the government take money from people and redistribute it to favored charities.

In Michigan, I have observed what happens when Democrats run government, and I predicted accurately what would happen if Obama and the Democrats won the elections of 2008. Democrats turned Michigan into Detroit, and Democrats are now turning the United States into Michigan. You need to make sure that everyone you know votes Republican next election, or else your kids will grow up in a nation that is less civil, less prosperous, and less free than then one they are growing up in now. We need to stop these Prussians who are running out government today before they turn us into Germany in 1900... 1920... or 1940.