Saturday, August 19, 2017

Condemnation

"Do not judge, and you will not be judged. Do not condemn, and you will not be condemned."
--Luke 6:37

The popular word in politically correct circles currently is 'condemn.' As in "I condemn (fill in behavior)." There are also public outcries for others to condemn (fill in behavior).

Alongside Matthew 7 and John 8, Luke 6 above suggests that we be careful with how we sling that word around.

Friday, August 18, 2017

Monumental Hysteria I

Colonel Robert Gould Shaw: It stinks, I suppose.
Tripp: Yeah, it stinks bad. And we all covered up in it, too. Ain't nobody clean. Be nice to get clean, though.
Colonel Robert Gould Shaw: And how do we do that?
Tripp: We ante up and kick in, sir. But I still don't want to carry your flag.
--Glory

Following the Charlottesville riots, progressives across the country are engaging in their latest bout of hysteria: seeking to remove or destroy all monuments that this group perceived as linked to the Confederacy and/or slavery. This can be seen as an extension of the left's Confederate flag fetish a couple of years back.

Of course, tearing down statues is the socialist way. Whether those socialists originate from communist or fascist sides of the spectrum, the idea is to erase symbols from the public mind that are inconsistent with the collective message. Also, being an intolerant lot, socialists seem to possess a strong urge to blot out words or symbols that cause them negative psychic income.

As many, including President Trump and Judge Nap, have argued, removing these monuments amounts to trying to erase history. And how far do you take it? The pyramids were built by slaves. The White House was built by slaves. Washington, Jefferson, Madison, et al were slave owners. Lincoln's racism. Slaves even worked in Lincoln's White House during the Civil War. Lots of infrastructure would have to come down to be logically consistent with this movement.

As Judge Nap questions, do we really want to pretend that none of this happened? He suggests that we're in a bad place when we erase and deny history. He argues that we should remember the awful so that the pain of those memories helps prevent those bad events from recurring. Quoting Orwell's 1984:

"Every record has been destroyed or falsified. Every book rewritten. Every picture has been repainted. Every statue and street building has been renamed. Every date has been altered. And the process is continuing day-by-day and minute-by-minute. History has stopped. Nothing exists, except an endless present in which The Party is always right."

The Judge fears we are getting there today. Me too.

Although I am sympathetic to this view, there is a good argument for removing these monuments from public places. We'll discuss it next time.

Thursday, August 17, 2017

Brandenburg Doctrine

William Roper: So, now you give the Devil the benefit of the law!
Sir Thomas More: Yes! What would you do? Cut a great road through the law to get after the Devil?
William Roper: Yes, I'd cut down every law in England to do that!
Sir Thomas More: Oh? And when the last law was down, and the Devil turned 'round on you, where would you hide, Roper, the laws all being flat? This country is planted thick with laws, from coast to coast. Man's laws, not God's. And if you cut them down, and you're just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I'd give the Devil the benefit of the law, for my own sake.
--A Man for All Seasons

Judge Nap adds legal perspective to our discussion (here, here) about the Charlottesville riots and the First Amendment. The First Amendment protects speech from government infringement. Government does not grant free speech. Free speech is a natural right derived from our humanity. Rather, the proper role of government is to protect speech from invasion by others.

The ink was barely dry on the Bill of Rights before the federal government moved to abridge freedom of speech--particularly speech perceived as threatening to government itself. Alien and Sedition Acts. Lincoln's War. Wilson and FDR during the World Wars. When those infringements were brought before the Supreme Court, sometimes they were rejected and sometimes they were upheld.

At a Ohio rally in the 1960s, a KKK leader named Clarence Brandenburg verbally attacked Jews and Blacks in the federal government and urged followers to travel to Washington and produce violence against them. Brandenburg was subsequently arrested and convicted under Ohio law that prohibited public expression of hatred as a means to overthrow the government.

Brandenburg's conviction was subsequently overturned in a unanimous decision by the Supreme Court in 1969. The court ruled that the entire purpose of the First Amendment is to protect speech that we hate and fear--lest, of course, it would not require protection. The right to decide what speech to consume is left to each individual--not to a group or the government. The court ruled that all innocuous speech is protected absolutely. Speech is considered innocuous when there is time for more speech to challenge it. Brandenburg's speech was innocuous because, while he suggested violence against government officials in Washington, there was reasonable time for speech to suggest otherwise.

The Court's 1969 ruling became known as the Brandenburg doctrine and has been consistently upheld since then.

Applied to the Charlottesville case, the Brandenburg doctrine says that the government cannot take sides in a public dispute. If it does so, then the government becomes a censor, thus infringing upon the free speech rights of those against whom it has taken a position. On the contrary, as noted in a previous post, government is obligated to protect the speaker's right to speak and the audience's right to hear and respond to the speaker.

When the police declined to maintain order in Charlottesville, government abdicated its responsibility to protect the right to free speech. They permitted the 'heckler's veto' where the audience silences speech that it dislikes. When the heckler's veto comes about as a result of government failure to protect the right to speak, then it is unconstitutional. It is equivalent to the government taking sides and censoring speech it hates or fears a la the early Alien and Sedition Acts.

Yet, I am aware of few mainstream media outlets headlining, or even investigating, this story: Government fails to uphold the First Amendment in Charlottesville.

Wednesday, August 16, 2017

Soft News and Pseudo Events

"A journalist makes himself the hero of the story. A reporter is only a witness."
--Jim Cleary (Deadline U.S.A.)

Yesterday these pages observed that there has been a lack of reporting and analysis by the mainstream of the actual Charlottesville riots--particularly with respect to First Amendment issues and how that process broke down.

Ryan McMaken provides an interesting follow up piece here. "Already," he notes, "the media has lost interest in analyzing the details of the event itself, and are instead primarily reporting on what Donald Trump, his allies, and his enemies have to say about it."

A good example is this WSJ piece this morning that focuses on what Donald Trump said yesterday during a press conference. The tone implies that Trump is wrong for claiming that both sides--the original assembly and the protesters of that assembly--shared blame for the violence. No reasonable mind should dispute Trump's claim given what facts have been made widely known about the events in Charlottesville, and not one shred of evidence is offered in the article that suggests otherwise.

McMaken links this situation to a phenomenon seen in the national media for many years: a shift away from who/what/when/where factual reporting about an event to a focus on what people who were not directly involved in the event think or say about it. Old school newspaper types would term this as a movement from 'hard' to 'soft' new. Historian Daniel Boorstin calls it an evolution toward 'pseudo events.'

Boorstin suggests that the need to create more copy led reporters and editors to realize that they could 'create' news by focusing on how people respond to a particular narrative that often first requires creation by media types themselves. That response constitutes the pseudo event. It is particularly 'news' when individuals defy the narrative in some way. Trump, of course, is a media dream in this regard.

McMaken suggests that what passes for news coverage today actually involves pseudo event journalism that, when you break it down, involves far more opinion than fact.

Tuesday, August 15, 2017

Protesters

We'll be fighting in the streets
With our children at our feet
And the morals that they worship will be gone
--The Who

The sad events last weekend at Charlottesville once again motivate review of issues related to political speech--particularly with respect to people who show up to protest that speech.  When political speech takes place in a public place, the speech rights of both the speakers to speak and any present protesters to peacefully protest must be upheld.

Protesters toe a fine line, however. They cannot lawfully interfere with political speech, however innocuous it might seem to them, in a manner that drowns out the message to the audience (a.k.a. the 'heckler's veto'). Physical force against the speaker or the assembly at large is also illegal, of course.

Moreover, it is the affirmative obligation of the police to protect the speaker's right to speak and the audience's right to hear as well as to protect the protester's rights to peacefully protest.

In all of the accounts that I have seen/read/heard about the Charlottesville incident I have yet to encounter one that clearly lays out the related facts related to both party's First Amendment rights. What is clear is that the process described above broke down badly.

The Charlottesville case also reinforces a previous observation. Demonstrating in the midst of someone else's political rally is like a spark in search of tinder. Whether intended or not, the likelihood of violence increases dramatically when opposing protesters show up at political rally.

Stated differently, if you intend to protest at someone else's assembly, then you are unnecessarily escalating a potentially violent situation.

Rather than protest, why not walk away? Graduate from the playground and let juvenile minds with small thoughts talk themselves into the ground?

Better yet, pray for them.

Monday, August 14, 2017

Poverty is the Natural State

"Ghettos are the same all over the world. They stink."
--Williams (Enter the Dragon)

Sage insight by Prof Bylund. People asking about the causes of poverty are asking the wrong question. Because scarcity is the default condition of the world, poverty is man's natural starting point.
Prosperity is the alleviation of poverty. The more salient question is what causes, and advances, prosperity?

Sunday, August 13, 2017

Tariffs Without Bounds

Everybody's kicking sand
Even politicians
We're living in a plastic land
Somebody give me a hand
--Steve Miller Band

Rothbard suggests a useful way to think about tariffs: forget about political boundaries. While country borders may be important for other reasons, they can be seen as arbitrary from an economic perspective and having little significance.

Imagine that each state in the US were a separate nation. Inevitably, there would be complaints from some states about unfair, cheap labor in other states undercutting inefficient producers on prices. Calls for tariffs would follow to protect essential local industries from that unfair competition.


Indeed, such trade wars between the original 13 states provided motivation for the Constitutional Convention of 1787. The idea was to have a central government to regulate--in the sense of making regular and free--trade between the states. And so it is today--an American free trade zone where it is illegal for states to levy tariffs on other states.

To push the tariff 'logic' to completion, why stop at country borders, asks Rothbard? Why not tariffs at state, city, or even the family level in order to shield producers from unfair external competition?

The answer, of course, is that such nonsense would cast the world back into the dark ages, where each producer would need to diversity in attempts of being self-sufficient. As trade dried up, division of labor and the productivity gains that it confers would disappear.

As history reminds us, tariffs protect squalor, not prosperity.

Saturday, August 12, 2017

War Drumming Markets

"'War is a continuation of politics by other means.' Von Clausewitz."
--Captain Frank Ramsey (Crimson Tide)

Markets took a hit on Thurs on back of North Korea situation--although not as much as one might have expected. Muted downside market response marks the time we live in--although that could change quickly, of course. Currently the SPX is not quite down to support defined by the multi-month uptrend line.


Volatility indexes did seem to take an outsized jump compared to the move in stocks. VIX was up nearly 60% in two days.


I happened to look at put schedules mid-week before the jump in vols. Despite historically low index vol levels, out of the money index puts did not look cheap to me--certainly nowhere near 'Simon' levels. This suggests significant option 'skew,' and is consistent with market participants scooping quantities of downside 'insurance.'

Sitting on my hands for now, and will see how things unfold.

no positions

Friday, August 11, 2017

Political Shortsightedness and War

"And the Lord said, 'Gentlemen, he who is without sin, let him cast the first stone.'"
--Professor Groeteschele (Fail Safe)

Saber rattling comments by Donald Trump aimed at North Korea earlier this week once again have his detractors wringing hands. Presidents don't talk like this, they complain.


They do now. Get used to it.

Trump's most recent round of behavior deemed unbecoming of a president presents another opportunity to warn those pointing fingers to take a good look in the mirror. How much of the current problem was created by political shortsightedness of a good many people?

Many didn't complain when the executive branch was assuming more power while their guy was sitting in The Big Chair. How nearsighted the granting of administrative power looks today now that someone less likable is in charge.

As a nation, we've been fine with the President of the United States carrying nuclear launch codes at his side for more than a half century--despite the fact that war-making power constitutionally rests with Congress. For many, that may seem pretty stupid right about now.

There has been also been a multi-decade, bipartisan effort to fund gargantuan war-making capacity. In the last year of the previous administration, military spending was targeted well north of a half trillion dollars.

Finally, let's not forget the role of sanctions. For years, politicians from both major parties have supported the imposition of trade sanctions against countries deemed to be enemies of the United States. Trade, not sanctions, foster interdependence and peace. Indeed, it has long been said that when goods don't cross borders, armies will.

Perhaps armies will cross borders this time as a result of our political shortsightedness.

Thursday, August 10, 2017

Sanctuary Cities

The traffic roars
And the sirens scream
You look at the faces
It's just like a dream
--Glenn Frey

Over the past couple of years, the term 'sanctuary cities' has been applied to cities whose political officials have refused to enforce federal immigration laws. Why have they done so? Sanctuary cities are almost exclusively under the control of Democrats. Because Democrats generally view voter blocks sympathetic to immigrant causes as valuable sources of political capital, their creation of sanctuaries for illegal immigrants can be seen as a thinly veiled strategy for winning votes.

Are sanctuary cities legal? As Judge Nap argues, yes. Local authorities are not obligated to help the feds with manpower or other resources to enforce federal law in local jurisdictions. The Supreme Court has ruled in previous cases that the federal government cannot force local officials to enforce federal law; the feds must enforce it themselves.

The Court's rationale is that such compulsion would violate the Guarantee Clause of the Constitution which guarantees a representative form of government in every state. If the feds interfered with the will of elected state officials on how to spend state resources (read: tax dollars), then representative government would be constitutionally impaired in those states.

To get around this legal inconvenience, the federal government has frequently provided funding to states that is contingent on state cooperation in particular matters. During the Reagan administration, for instance, the feds dangled dollars in front of states for interstate highway repairs under the condition that states reduce speed limits to 55 miles/hr. If states didn't want to lower their speed limits, then they were free to reject the funds. Subsequent ruling by the Supreme Court validated the legitimacy of what resembles a contract.

In other cases, however, the federal government has threatened to pull funding from states who refuse to comply with a federal demand that was not specified when the monies were first sent to the states. For example, in a move designed to force states to expand Medicaid under Obamacare, the federal government threatened to cut Medicaid funding to states who didn't do so. In one of the few Supreme Court rulings related to Obamacare that made sense, this initiative was ruled invalid by the Court.

Not only does such a practice by the federal government violate the principle of federalism, but it is not good contracting practice.

A similar situation has arisen in the context of the sanctuary cities. Under the Obama administration, funds were offered to sanctuary cities with no strings attached related to federal immigration law enforcement. Now, the Department of Justice under the Trump administration wants to impose such strings retroactively. As Judge Nap notes, that won't fly in the courts and any legal challenge on withholding Obama era funding should favor the sanctuary cities.

What the Trump administration can do is work with Congress on future funding packages that do require state cooperation in immigration law enforcement if states want those funds.

In the case of sanctuary cities we are witnessing principles of federalism and nullification in action--both of which are healthy and favorable for liberty. Democrats and Republicans, of course, tend to like these principles when they work in their political favor and detest them when they don't.

Wednesday, August 9, 2017

Civil Asset Forfeiture

"Nice house on government pay."
--Mace Ryan (Rapid Fire)

Civil asset forfeiture is government seizure of property believed to be involved in a government crime. For example, people thought to be transporting drugs can have their vehicles confiscated by the police.

The government can use civil asset forfeiture to take property from owners that was used in criminal activity unbeknownst the the owner. Real estate owners (e.g., homeowners, apartment building owners) can lose their property because guests or renters were dealing drugs behind the owners' backs.

The big thing is this: Government can keep the property that it confiscates even if it never convicts, or charges, the owners.

This opens the door for civil asset forfeiture to be a multi-billion dollar money maker for government at all levels. Studies, for instance, indicate that most states allow police and prosecutors to keep at least half the loot that they confiscate. The IRS can also use civil asset forfeiture to increase tax collections.

As Ron Paul observes, civil asset forfeiture is a euphemism for civil asset theft. Recently, Attorney General Jeff Sessions ordered the Department of Justice to increase use of civil asset forfeiture. In doing so, he, like his predecessors, is escalating use of a clearly unconstitutional policy.

Twenty four states have now passed legislation limiting its use. Let's hope that trend continues. More state-level push back might impair federal level looting as well.

Tuesday, August 8, 2017

Low Vol, No Vol

Fool, said I, you do not know
Silence like a cancer grows
--Simon & Garfunkel

While recent headlines have emphasized more all time highs in the major equity indexes, the extremely low volatility context that surrounds them have largely been ignored. As ZeroHedge notes, it has now been 13 days since the SPX has moved more than 0.3% in either direction.


Am reminded of observations that unstable systems often go quiet before breaking apart. Minsky's theory that 'stability breeds instability' also comes to mind.

Silence is not necessarily a harbinger of peace and solitude.

no positions

Monday, August 7, 2017

Socializing Kids

"America is a whorehouse...where the revolutionary ideals of your forefathers...are corrupted and sold in alleys by vendors of capitalism."
--Re-Education Film Narrator (Red Dawn)

Bernie Sanders will soon release a new book aimed at teens: Bernie Sanders Guide to Political Revolution.


It follows the recently released book from MIT Press, Communism for Kids.


Since the time of Marx and Engels, socialists have understood that they must try to indoctrinate minds before they fully develop. Once minds mature and are able to think critically, the drivel of socialism becomes much harder to swallow.

Sunday, August 6, 2017

Demand for Media Bias: The Microaggression Crowd

There are things we won't recall
And feelings we'll never find
It's taken so long to see it
'Cause we never seemed to have the time
--Phil Collins

Producers of slanted media could not persist unless there was a market for biased information. A large source of demand for media bias is likely to be people who protest opposing views or claim to be offended by so-called 'microaggressions.' Their intolerance for opposing views that by definition add to balanced perspective is so great that they refuse to admit those viewpoints for consideration.

Instead, the microaggression crowd will want to remain inside their comfort zone and consume media that reinforces their worldview and provides a source of positive psychic income.

Saturday, August 5, 2017

Eat Your Cooking

"You reap what you sow. You have heard of this, no?"
--Imad (Kingdom of Heaven)

President Trump recently tweeted that bailouts for insurance companies and members of Congress related to Obamacare should end.


The reference to Congress involves an exemption that allows congressional members to opt out of the ACA framework in pursuit of other healthcare alternatives.

Thomas Massie subsequently asked the president why he didn't end them right now?

Trump has the power to do so. Why shouldn't Congress be required to eat its own cooking?

Friday, August 4, 2017

Whiskey Rebellion

"How could it come to this? An army of rabble...peasants. Everything will change. Everything has changed."
--General Charles Cornwallis (The Patriot)

Rothbard discusses one of the many American events that has been distorted by historians: the Whiskey Rebellion. The official narrative is that people in four western Pennsylvania counties refused to pay an excise tax on whiskey that had been levied by the workings of Alexander Hamilton, then Secretary of State, in 1791. Subsequent uprisings drove President Washington to call a federal army of 13,000 into the area to put down the insurrection in 1794.

Consequently, according to the narrative, a local but dramatic challenge to federal taxing power had been defeated, and the forces of federal law and order were reinforced.

Rothbard points out the flaws with the official narrative. The deep seated hatred that Americans had for internal taxes of any kind found widespread resistance to the whiskey tax far beyond a mere four Pennsylvania counties. In frontier areas of several states, no one paid the tax on the whiskey.

Moreover, whiskey was widely produced by back-country farmers and often used as a medium of exchange in local transactions. Back-country people people correctly viewed the tax as a means for large distilleries to cripple their smaller and more numerous competitors.

Western Pennsylvania, Rothbard observed, "was only the tip of the iceberg." It became the focus in large part because it was one of the few back-country areas that made any attempt to collect the whiskey tax. Other areas did not rebel because the taxes were not being collected.

Widespread resistance to the tax ultimately helped motivate formation of the Democrat-Republican party and the forthcoming Jeffersonian movement. In fact, one of Jefferson's first acts as president was to repeal the entire federal excise tax program.

The true story of the Whiskey Rebellion is that it was a widespread, multi-year campaign of civil disobedience in which American citizens refused to pay a hated tax. Rather than being quickly put down, the Whiskey Rebellion was successful in that it eventually led to federal repeal of the tax.

It is easy to see why the story was subsequently distorted. Washington and his cabinet did not want to advertise the extent of their failure. And big government historians certainly did want it known that federal taxing power could be successfully challenged by the people.

When correctly viewed, the Whiskey Rebellion was a victory for liberty rather than for the state. It offers a source of inspiration and hope for American taxpayers who ponder being tax resisters.

Thursday, August 3, 2017

Compassion, Envy, and Redistribution

Feed the babies
Who don't have enough to eat
Shoe the children
With no shoes on their feet
House the people
Living in the streets
Oh, oh there's a solution
--Steve Miller Band

Interesting multi-disciplinary, multi-national study on what motivates individual support for economic distribution. The fundamental hypotheses propose that various motivational systems--compassion, envy, self-interest, and taste for fairness--nfluence a person's support for economic redistribution. Scales used in the study can be found here. Over 6000 respondents from four countries were obtained.

Among the less interesting findings was that self-interest was positively associated with support for forced redistribution. Stated differently, if you perceived that you would benefit from the redistribution program, then you were in favor of it. Not a surprise.

A more interesting finding was that there was no significant relationship between taste for fairness and support for redistribution. This is surprising to me. The researchers were careful to measure fairness using two separate underlying definitions consistent with common views--i.e., fairness under law and fairness in outcomes. Neither of the fairness scales were found related to support for distribution in 'all-in' regression models.

Perhaps this was due to high cross correlations with other constructs. Unfortunately, correlation matrices are not available and the researchers, while conducting some assessment of internal consistency of their scales (e.g., Cronbach's alpha), did not evaluate/report measures of discriminant validity. This is a limitation of this study that lends to the feel that this is a 'working paper' that has been published in a 'preliminary edition' of a proceeding as indicated on the pdf masthead.

The most interesting findings concerned the compassion and envy constructs (both measured with multi-item psychometric scales). Personal compassion was not associated with support for coerced economic redistribution. Instead, compassion was positively related to charitable giving and voluntary work with the needy. Individuals who did support forced redistribution were less prone to charitable giving.

Envy was found to be positively associated with forced redistribution. Moreover, based on several cases posed in the study, respondents who measured high on the envy scale were prone to tax the wealthy (i.e., redistribute economic resources) more even though poor people would receive less.

Results of this study suggest that compassionate people do not favor forced redistribution. Rather, they prefer voluntary charity. Envious people, on the other hand, support forced redistribution. However, envious support for the forced redistribution may not be due to desire to help the poor as much as it is due to desire to hurt the rich.

Wednesday, August 2, 2017

Hot Rentals

The heat is on, on the street
Inside your head, on every beat
And the beat's so loud, deep inside
The pressure's high, just to stay alive
'Cause the heat is on
--Glenn Frey

I haven't rented since the early 1990s. Back then I was paying low to mid $300/month for a single bedroom unit with detached garage. From the looks of the below chart, I was probably just about average after factoring in my apartment's size.


Fast forward 25 years and rents have more than doubled nationwide. A brief scan of rents for open units in my former stomping grounds is consistent with the trend.

For renters, the heat in on.

Tuesday, August 1, 2017

Promising Poverty

You made me promises, promises
You knew you'd never keep
Promises, promises
Why do I believe?
--Naked Eyes

As the new campaign cycle kicks in, we once again observe politicians trading promises for votes. Many of those promises are for free stuff. Free healthcare, free college, free food, etc.

Many of those same politicians also promise that there will be jobs for all.


As questioned above, what happens to incentive for work when economic resources are given for free? Another way to ask the question is who produces the free stuff?

Anyone who thinks this thru is bound to arrive at this truth: the greater the socialism, the lower the productivity. The lower the productivity, of course, the lower the standard of living.

They may not realize it, but these politicians promise not prosperity, but poverty.

Monday, July 31, 2017

Unhealthy Dance

He tried pretending a dance is just a dance
But I see
He's dancing his way back to me
--Molly Hatchett

What happens now that attempts to repeal Obamacare have failed? As Rand Paul notes, healthcare costs and insurance premiums will continue their upward march, capacity will leave the market, and consumers will have less choice.

Sadly, the design flaws of Obamacare, and of socialized medicine in general, made such outcomes completely predictable years ago.

Although the spotlight currently shines on GOP failures to coalesce behind an alternative design, it has been the Democrats that have circled the wagons around a program that will soon blow sky high. In their rush to display solidarity, Dems have chosen to continue to escalate a failing course of action. Hindsight might reveal that they would have been better off offloading the problem to Republicans right here.

Now that they are back to owning it, the Democrats' tap dance away from responsibility for the program's failure will soon take center stage.

A curious question remains: Will Republicans try to rejoin the dance?

Sunday, July 30, 2017

Acceptance, Peace, and Prosperity

Gary Wallace: That's not my car. This isn't my suit. Those weren't even my friends.
Deb: Why are you telling me this?
Gary Wallace: Because I want you to like me for what I am.
Deb: Whatever you are, I like it.
--Weird Science

How many socioeconomic philosophies accept people for who they are? How many socioeconomic philosophies do not try to regulate behavior or alter who people are thru use of offensive force? How many socioeconomic philosophies assert that prosperity is best advanced by voluntary, peaceful exchange among people?

Only one that I know of.

Saturday, July 29, 2017

Neutralizing Threats to the State

Hey!
Think the time is right for palace revolution
'Cause where I live the game to play
Is compromise solution
--The Rolling Stones

The state grows larger only by expropriating ever more resources from some for the benefit of others. Those beneficiaries constitute principals contracting with strong armed government agents for their mutual welfare. A larger state means more benefits for the principals and their agents.

Naturally, the principals and agents of the state will be reluctant to surrender their spoils. That reluctance will grow with the size of their take. Because the state has now grown to mammoth proportions, the resolve with which state beneficiaries seek to hold onto their spoils is also very strong.

Anyone who challenges this institutional arrangement or, pray tell, seeks to reduce or eliminate it, will face stiff resistance. Indeed, principals and agents of the state will do everything in their power to neutralize the threat.

All stops are unlikely to be pulled right away, however. Instead, a progression is likely where force is hidden (in pretense that the state does not act aggressively) and becomes more overt only if necessary to neutralize the threat. The progression of force generally unfolds as follows:

Social force. The first phase is to apply social pressure to back off the threat. Public ridicule, belittlement, revelations of personal secrets, etc. The media, which is often a large beneficiary of state power, serves as a primary instrument in this phase. The idea is to create a situation where the target feels so much embarrassment, shame, etc so as to give up and 'voluntarily' walk away.

Legal force. If that doesn't work then the next step is to use the legal system to force the target to stop acting in manners that threaten the state's institutional arrangement. Laws, law suits, arrest, impeachment, et al. are meant to keep the threat at bay.

Physical force. If the legal system is unable to deter the threat, either because the laws cannot be bent enough to ensnare the individual or because the subject refuses to comply, then overt physical force is necessary. If the threat has made it this far, then it is unlikely that low to moderate levels of force will be effective. Principals and agents of the state will probably need to use lethal measures to neutralize the threat.

Because history suggests that running this gauntlet takes what might be viewed as divine commitment, the state's approach to neutralizing threats has been quite successful.

Friday, July 28, 2017

Frenemies

"We should stop pussyfooting about the goddamn Russians! We're gonna have to fight them sooner or later anyway. Why not do it now, when we've got the army here to do it with? Instead of disarming these German troops we oughta get them to help us fight the damn Bolsheviks."
--General George S. Patton (Patton)

An ancient tenet of strategic behavior is that 'the enemy of my enemy is my friend.' The idea is that factions normally in opposition will be prone to form coalitions against common adversaries. Enemies become friends ('frenemies') in order to protect or extend their interests against another factions deemed more threatening than the dangers that the coalition parties pose to each other.

A classic frenemy relationship during WWII was the allied US and Soviet Union--two opposing states that banded together to fight a common Axis enemy.

Frenemies are almost by definition temporary relationships. If/when the coalition wins the fight against the common enemy, then frenemies will tend to view each other as opponents once again. The US/USSR coalition quickly dissolved after WWII and the adversarial relationship that followed polarized into a multi-decade Cold War.

In dynamic environments with many factions, frenemy relationships form and dissolve rapidly as each faction seeks to further its interests.

There is no better example of frenemy dynamics than modern politics--particularly politics grounded in democratic (i.e., majority rule) decision-making process. Years ago, for instance, we forecast the tenuous Tea Party/Republican Party frenemy relationship.

The name of the game in the political context is to build a large enough coalition to control the decision--either by winning votes outright or by causing other parties to not win. Factions that normally tear at each others' throats mutually support each other one day only to fight on opposite sides the next day.

Herbert's observations suggest that frenemy relationships become more frequent as democratically motivated factions fight for control of the strong arm of the state. Abundant empirical evidence is available to support claims that we are currently experiencing precisely this.

It is also straightforward to hypothesize that, extended over many periods, the frenemies game played in the political arena serves to hasten the chaos endpoint.

Thursday, July 27, 2017

Half Full Healthcare

There's a battle ahead
Many battles are lost
But you'll never see the end of the road
While you're traveling with me
--Crowded House

Yesterday a group headed by Rand Paul was able to get a clean repeal of Obamacare bill before the Senate for a vote. This bill was nearly identical to the 2015 bill that attracted a near unanimous vote by Republicans when it was understood that then President Obama would veto it.


This time, when it was understood that President Trump would sign a clean repeal bill, seven Republicans, including Ohio's Rob Portman, voted against it which served to strike it down in the Senate.

While this seems a defeat for the cause of liberty, there are several reasons to assume a glass-half-full perspective. Tea Party types in the Senate who promised voters that they would act to repeal Obamacare did their job. A straight repeal vote was unthinkable until just a short time ago.

Moreover, Rand Paul's uncompromising actions in the health care arena strengthen his position as a leader for liberty. My sense it that this has positive long run ramifications.

Yesterday's vote also exposes several Republicans as progressives--a transparency that should also prove beneficial over time.

Finally, although a straight repeal would have directly alleviated Americans from the burden of the ACA, Obamacare as-is is destined to fail--perhaps within a year. Barring some version of 'Skinny Repeal' that strips away burdensome aspects of the ACA--a possibility that is still alive in the Senate--the burden of the failing Obamacare system falls back into the laps of progressives on both sides of the aisle.

The tap dancing to un-own the failure should prove entertaining as always.

Wednesday, July 26, 2017

Enslaving the Future

Amanda Jones: What is this?
Keith Nelson: It's my future.
--Some Kind of Wonderful

Salient point by Thomas Massie on who pays for the public debt that finances deficit spending. Today's generation borrows and tomorrow's generation pays. There is, however, an argument to be made that this is more appropriately termed slavery rather than theft.
This is why I refuse to buy sovereign debt. I could not look my niece and nephew in the eyes knowing that I was party to a contract that put them on the hook for my generation's profligacy--not to mention the coupon payments on the bonds for my financial gain.

Tuesday, July 25, 2017

Breaking Ranks

"You'll never be one of them."
--Captain George von Trapp (The Sound of Music)

Many people mock the inability of Republicans to stand together on a variety of issues. Look at the Democrats, they say. Dems have the ability to die to one's self, to take one for the team, to stand in solidarity.

Why is such unity deemed valuable? Because in a democratic political system numbers matter. If you can somehow get enough otherwise diverse factions to band together with you then you can gain control of the strong arm of government.

This is why liberty and democracy are fundamentally at odds. Those willing to compromise in order to join a majority faction are prone to give their freedom away.

This is also why collectivists are attracted to democracy. By definition, collectivists emphasize group over individual interests. They are more prone to compromise for the sake of the collective.

Preference for collectivism can be seen as distributed across a spectrum:

Highly collectivist preference <------------------>Low collectivist preference.

Preference for collectivism should be inversely related to preference for liberty.

It is safe to say that people with more collectivistic tendencies will be attracted toward the Democratic Party while people with less collectivistic tendencies will be drawn toward the Republican Party.

Because they are less collectivistic by nature, Republicans are more prone to break ranks and disagree on issues. This naturally puts them at a disadvantage in political systems grounded in first-past-the-post political processes.

Monday, July 24, 2017

Ungovernable

I must've dreamed a thousand dreams
Been haunted by a million screams
But I can hear the marching feet
They're moving into the street
--Genesis

As the stakes associated with controlling the strong arm of democratic states continue to grow, Herbert proposed that factions will grow increasingly hostile toward each other. They will be hellbent on gaining government control and keeping control out of competing faction hands.

This hostility logically extends to voters on the losing side. They will become increasingly ungovernable (e.g., 'We Resist...') to the ruling majority. The real folly is that the ungovernable minority expects that the other side will somehow submit to their rule if/when the roles are reversed.

All part of the topsy-turvy ride down the path toward the Misesean chaos endpoint of socialism.

Sunday, July 23, 2017

Overdependence on Insurance

If you change your mind
I'm the first in line
Honey I'm still free
Take a chance on me
--ABBA

Ryan McMaken argues that a primary way to improve the healthcare system is to reduce dependence on health insurance products. Use of insurance as a principal means of distributing healthcare is largely a post WWII phenomenon--borne from government tax and regulatory interventions that rewarded corporations for offering health insurance to employees. Subsequently, the insurance model replaced cash markets where consumers purchased healthcare goods and services for a fee.

As insurance replaced fee-for-service markets, healthcare costs began their ascent. Why? In large part because health insurance invites moral hazard and subsidizes consumption, thereby reducing incentives to shop for value.

Cash markets, on the other hand, encourage entrepreneurship among producers who must constantly become more productive in order to win the business of value-conscious buyers. Thus, as McMaken notes, we observe ongoing patterns of innovation in industries that rely on cash-for-service transactions. Food, for example, a cash market good that is no less essential for life than healthcare, constantly gets better and cheaper and now comprises a lower percentage of household budgets than in the past.

McMaken proposes changes to tax codes and regulations to reduce dependence on the health insurance model. Tax-free health savings accounts and tax credits for health spending should be expanded. Group coverage options beyond employer-sponsored plans should be nurtured. Markets need to be opened to more providers willing to operate in fee-based markets.

He makes a nice point near the end of his article. If a society wanted to build a healthcare system where prices were permanently high and improvement was hindered, then one would be hard-pressed to design a system more conducive to those outcomes than the current one.

Saturday, July 22, 2017

Central Question Facing Statists

In violent times
You shouldn't have to sell your soul
In black and white
They really, really ought to know
--Tears for Fears

The central question that any statist, whether that statist leans toward the welfare or warfare end of the spectrum, is how do you justify the use of offensive force against others in order to enact your policies?

Statists have yet to reasonably answer this question.

Friday, July 21, 2017

Hypocrisy and Politics

"Listen, I'm a politician, which means I'm a cheat and a liar. And when I'm not kissing babies, I'm stealing their lollipops."
--Jeffrey Pelt (The Hunt for Red October)

Although these pages have long observed that hypocrisy and politics go hand in hand, I continue to shake my head at the blatant inconsistency of the Washington crowd. What was ok when your guy/party was in charge is outrageous when the other guy/party is in charge.

It does make one speculate about the extent to which political hypocrites are actually aware of their inconsistent behavior. Do they know and not care? Or do they not know what they are doing?

For those striving to for consistency regardless of situation, political hypocrites provide good examples of what not to do.

Thursday, July 20, 2017

Stealing Liberty

All for freedom and for pleasure
Nothing ever lasts forever
Everybody wants to rule the world
--Tears for Fears

One would think that the primary question that guide the actions of politicians--those who have sworn to uphold the Constitution--would be "What does the Constitution permit us to do?" Instead, the primary question is "What can we get away with?"

This is the question of thieves. Answers aim at stealing liberty.

Wednesday, July 19, 2017

No Worries

In every life we have some trouble
But when you worry you make it double
--Bobby McFerrin

All time highs once again for the SPX and COMP.


No worries for the bulls.

no positions

Tuesday, July 18, 2017

Repeal Appeal

Second time around
I'm still believing
The words that you said
--Naked Eyes

On the back of Rand Paul's continued strong, outspoken stance and formal thumbs down announcements by several other Republican senators including Mike Lee, the idea of repeal now and discuss replacement later is gaining momentum. President Trump tweeted the following last night:
Several posts in agreement with Trump, such as this one from VP Mike Pence, followed. Now, Senate Majority Leader Mitch McConnell is turning his hat around:
An up or down straight repeal vote of Obamacare seems increasingly likely.

This is what staying the course, prioritizing principle over compromise, and doing as promised can produce.

Monday, July 17, 2017

Hamilton and the Left

Peter Howard: We are citizens of an American nation! And our rights are being threatened by a tyrant three thousand miles away!
Benjamin Martin: Would you tell me please, Mr Howard, why should I trade one tyrant three thousand miles away for three thousand tyrants one mile away? An elected legislature can trample a man's rights as easily as a king can.
--The Patriot

Many people scratch their heads over the Left's affinity for Alexander Hamilton. Hamilton was, after all, one of the vocal framers of the Constitution. He also wrote skeptically, in the Federalist Papers and elsewhere, about a euphemism of leftist rule: democracy.

However, once the Constitution was ratified, Hamilton's actions revealed his true nature--much of which leftists would find naturally appealing. He favored a strong central government and thought the Constitution should be bypassed as necessary by the ruling class. In Hamilton's view, that ruling class should be aristocratic nature. He thought the the president should be granted lifetime tenure and that the powers of the executive branch should be disproportionately large.

As first the first treasury secretary, Hamilton initiated the nation's sovereign debt program and liked the idea of acquiring federal resources on the back of taxpayers. He was fond of central banking and got the First Bank of the United States, a predecessor to today's Federal Reserve, off the ground.

In many ways Hamilton's profile resembles Lincoln's--another authoritarian who leftists love to love.

Sunday, July 16, 2017

One Relationship Matters

Hey now, hey now
Don't dream it's over
Hey now, hey now
When the world comes in
--Crowded House

Only one relationship continues to matter when explaining the levitation of stocks. Asset buying by central banks is propping up markets round the the world.


The question remains: what causes this relationship to break?

Saturday, July 15, 2017

Staying the Repeal Course

"Stay the course."
--Gabriel Martin (The Patriot)

Rand Paul digs his heels deeper w.r.t. the Obamacare 'replacement.' The Establishment is working on co-opting other senate holdouts here and there and is predictably painting Paul as an island--a selfish island of an individual who would rather see 'the country' suffer under the ACA than compromise on some kind of replacement socialized medicine program.


For principled people, however, those principles are not open to compromise. Paul knows that the best (only) chance of ACA repeal is if he stays the course.

Friday, July 14, 2017

What's in a Name

Meet the new boss
Same as the old boss
--The Who

The Affordable Care Act. An oxymoron like that could only come from...morons.

Now a new bill is under construction: the Better Care Reconciliation Act.

Same approach, but from a separate group of morons.

Thursday, July 13, 2017

Markets Reduce Bigotry

Mrs. Leslie Colbert: I came by to make it as clear as I possibly can--that I do not want the Negro officer taken off this case.
Mayor Webb Schubert: Negro officer?
Chief Gillespie: Yeah, well he, uh, comes from up North, you see, and he was, uh, kinda passing thru...
Mrs. Leslie Colbert: I don't care what he is. If it wasn't for him, your impartial chief would still have the wrong man behind bars. I want that officer given a free hand. Otherwise, I will pack up my husband's engineers...and leave you...to yourselves.
--In the Heat of the Night

As Friedman observes, markets reduce bigotry. In unhampered markets, people are free to discriminate as they wish. However, if those discriminatory policies result in poor customer service, then those policies will be punished by the market while other sellers with less discriminatory policies will be rewarded.


Stated differently, unhampered markets temper bigotry in the name of self-interest.

On the other hand, regulations (such as, ironically, the Civil Rights Act of 1964) that discourage entrepreneurs from entering industries where bigoted behavior takes place are more likely to make discriminatory behavior more durable.

Wednesday, July 12, 2017

Encouraging Marginally Productive Robots

Standing in line
Marking time
Waiting for the welfare dime
'Cause they can't buy a job
--Bruce Hornsby and the Range

Prof Williams reiterates a point made by these pages before (e.g., here, here, herehere). Minimum wage laws motivate producers to look for labor substitutes--such as robots. These investments would not be economical except for the fact that a floor has been forced under labor prices.

Marginally productive people that would have been employable at lower labor prices are no longer in demand at the higher labor price manipulated by law. And marginally productive robots that would have been bad investments when labor prices were unhampered are now attractive at the manipulated labor price.

Both of these--marginally productive labor unnaturally forced to the sidelines and marginally productive machines unnaturally put into action--are undesirable over time. Marginally productive labor grabs no toehold in the market and likely heads to welfare to live off the production of others. Marginally productive machines are vulnerable to economic shocks due to their inflexibility.

Over time, minimum wage laws constitute economic malpractice. They discourage marginally productive workers and encourage marginally productivity robots.

Tuesday, July 11, 2017

Selective Imperialism

"You shouldn't have come here."
--Atto (Black Hawk Down)

Many people have no problem subscribing to the belief that U.S. meddling in the affairs of other countries is inappropriate. They further believe that this meddling drives people in other countries to rightly hate America. In extreme cases this hate motivates pushback against the U.S. brand of foreign imperialism, much of which is justified.

Paradoxically, many of these same people have no problem supporting programs of domestic imperialism where a faction seeks to use the strong arm of government to forcibly meddle in the affairs of its own citizens. Such meddling is rationalized in various euphemisms--for the greater good, part of the social contract, etc. Further, they see any pushback against these internal invasions as completely unjustified.

Selective reasoning operationalized as selective imperialism.

Monday, July 10, 2017

Illinois Inevitability

"You hear that Mr Anderson? That is the sound of inevitability."
--Agent Smith (The Matrix)

That giant sucking sound? It's just the latest socialist state--Illinois--circling the drain of bankruptcy.


Others wait in the queue to face inevitability.

Sunday, July 9, 2017

Phoenix Rising?

The people came to the capitol town
One hundred thousand of them laid their hearts down
They screamed in anger and broadcast their fears
Just to have them fall on deaf ears
--Dan Fogelberg

Amusing Economist article from 1988 predicting that a common world paper money (the article labels it the 'Phoenix') would replace national currencies in 30 years. That deadline is fast approaching, of course, with no world currency in sight.


Since this article's publication, the closest the world has come to consolidating money over sovereign boundaries is the euro. Yes, the euro has reduced transaction costs of trading on the Continent. But it has exposed problems associated with trying to blanket one currency and its associated monetary policy across sovereign nations with varying needs.

Moreover, a single world paper currency exposes countries to monetary mischief of others that cannot easily be controlled via political process.

Stated differently, the greater the distance over which a single paper money is employed, the greater the risk to local sovereignty.

Doubt we'll see the Phoenix rising anytime soon.

Saturday, July 8, 2017

Evaluating Healthcare Policy Consequences

I read the news today, oh boy
Four thousand holes in Blackburn, Lancashire
And though the holes were rather small
They had to count them all
--The Beatles

One of the best books someone can read to improve their economic thought process, particularly w.r.t. evaluating economic policy, is Henry Hazlitt's classic Economics in One Lesson.

Using various policy topics (e.g., minimum wage, tariffs, welfare programs), Hazlitt repeatedly demonstrates how to apply Bastiat's analysis of 'that which is seen and that which is not seen.' Hazlitt prompts the reader to look beyond outcomes that typically make headlines (e.g., "layoffs resulting from process automation") to the less discussed but usually important consequences (e.g., long run effects on prosperity from productivity improvement projects).

Such perspective is invaluable when making sense of public policy issues, such as the current healthcare debate. Proponents of state-run healthcare splash headlines with threats that millions of people will die, or at least lose their healthcare coverage, if Obamacare is repealed and/or replaced. Such claims, of course, are dubious to begin with (e.g., here, here, here) and smacks of emotional capture propaganda.

But even if those claims contained elements of truth, a complete and honest analysis involves evaluating other policy. What has been the effect of Obamacare on jobs, for instance? On the availability of healthcare resources? On health insurance premiums? On healthcare productivity and innovation?

Consider as well the social consequences of forcing some people to produce healthcare resources for the benefit of others? And what would have happened had those resources not been forcibly diverted?

Small minds respond to what is fed to them about healthcare. Inquiring minds go beyond.

Friday, July 7, 2017

New Institutional Economics

"I am the eyes and the ears of this institution, my friend."
--Carl the Janitor (The Breakfast Club)

As a founder of the new institutional economics (NIE), Williamson (2000) proposed a hierarchy of institutions that influence economic exchange (Figure 1). At the bottom (L4) come basic institutions of the market, such as prices and quantities, that are constantly in flux in the face of everyday transactions and exchange.


Next up (L3) comes structure that governs those everyday transactions to make them more efficient. Organizations and contracts are primary examples of such governance structure. Time horizon for change here ranges from one year (typical contract length) to a decade (consistent with time tom implement major organizational change).

L2 represents the institutional environment where formal rules for game of market exchange are made. This is the land of politics, law, and government agency that defines such things as property rights. Williamson estimates the stability of this level ranges from 10 to 100 years. Personally, I suspect change happens quicker at this level--although not as quickly as L3 change. On the short end, L2 change might occur 4-8 years in association with major government election cycles.

At the top of the hierarchy (L1) rests informal institutions embedded in human psyches such as customs, social norms, tradition, and religion. L1 is the most stable and takes generations, typically, to evolve.

Williamson posits that individuals spend most time at lower levels of the institutional hierarchy. Entrepreneurs, for example, prefer L3 and L4. Because it is costly to foray into higher levels (e.g., opportunity cost of not being close to customers, cost of lobbying), individuals only do so when expected returns are high. L1 is generally not a target for economizing behavior since change here usually requires more time that most people have on this earth.

I like this framework--particularly w.r.t. research questions that link L3 and L4 actions with L2 institutional activity. More to come...

Reference

Williamson, O.E. (2000). The new institutional economics - Taking stock, looking ahead. Journal of Economic Literature, 38(3): 595-613.

Thursday, July 6, 2017

Off Script

Frank Horrigan: I've never worked with a female agent before. How many are there?
Lilly Raines: About 125.
Frank Horrigan: Mmm. Pure window dressing.
Lilly Raines: Excuse me?
Frank Horrigan: Window dressing. About 125 out of a little over 2,000. They have you all around so that the President can look good to his feminist voters.
Lilly Raines: Do you make an effort to be obnoxious, or is it a gift?
Frank Horrigan: It's a gift. Let's face it, half the things we do are window dressing. Take running alongside that limousine. It'd take an anti-tank missile to put a dent in that damn thing. But there we are, out for show, trying to make the President look more presidential.
--In the Line of Fire

Chris Rossini argues that a primary factor driving the rancor directed toward President Trump is Trump's refusal to play the institutional role of President of the United States.

The institution of The President has been under construction by statists for over one hundred years. According to the institutional script, The President is the ultimate in political correctness. An orator of lofty rhetoric. Compliant with rules of formality. A master of diplomacy. All actions reflective of a 'presidential' construct.

Trump's unconventional actions upset the institution. He is spontaneous. He is prone to outbursts. He tweets what he thinks. He is a rule breaker.

By refusing to kowtow to the presidential tradition, Trump is off script. This infuriates the architects of The President and their statist minions to no end.

Wednesday, July 5, 2017

Pushing Limits

And when the night is cold and dark
You can see, you can see light
'Cause no one can take away your right
To fight and never surrender
Never surrender
--Corey Hart

Human performance can be viewed as a product of skill and drive. Skill is talent that can be applied toward executing a task. Skill is often multifaceted. For example, hitting a baseball hard on a consistent basis requires a good deal of strength, quickness, and hand/eye coordination among other things.

At any point in time, skill is capped at an upper bound which in turn limits human performance. A hitter's strength helps restrain the exit velocity of a ball coming off his bat. In the near term, skill defines human capacity.

Drive is ingenuity for getting as much performance out of one's skill set as possible. It is a composite of many factors, including interest in the activity being performed, confidence in one's ability, focus and persistence, and ability to learn.

In the short term, drive dictates how much of one's skill is employed toward achievement. People with low drive employ only a fraction of their skill toward an activity while people with high drive might squeeze every last drop of potential from their skill sets. Drive, in other words, defines human capacity utilization.

In the long run, drive extends the thresholds of skill so that more can be achieved. Why? Because, unlike skill, capacity for human ingenuity is unlimited. A hitter with high drive can always train his body to get stronger and quicker. He can take advantage of technologies such as video to replay his actions and to learn vicariously from others. He can practice concentration techniques to tune out noise and improve his concentration at the plate. For a person with high drive, this improvement process never ends.

Stated differently, drive motivates improvement. Improvement pushes the limits of skill such that the boundaries of human performance, while limited in the near term, are essentially undefinable over time.

Tuesday, July 4, 2017

Free Spirit

"Knights, the gift of freedom is yours by right. But the home we seek resides not in some distant land; it's in us, and in our actions on this day! If this be our destiny, then so be it. But let history remember, that as free men, we chose to make it so!"
--Arthur Castus (King Arthur)

Liberty cannot be realized unless one's spirit is free. How you think and feel is in your dominion alone. If you allow others to intrude on your spirit, to influence or control it, then that is your choice. You have surrendered your freedom voluntarily.


It is impossible for someone else to compromise your spirit unless you allow it.

On this Independence Day, declare your spirit free.

Monday, July 3, 2017

Re-Declaration of Independence

Benjamin Franklin Gates: You know, of all the ideas that became the United States, there's a line here that's at the heart of all the others. 'But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.'
Riley Poole: Beautiful...I have no idea what you just said.
Benjamin Franklin Gates: It means that if there is something wrong, those that have the ability to take action have the responsibility to take action.
--National Treasure

Ron Paul observes that our founding ancestors fought a war against the British Crown to reclaim far less liberty lost compared to today. Today we face, among other intrusions on our freedoms, stifling tax rates, pervasive government surveillance, restrained travel, a dominant military industrial complex, a devaluing dollar, and burgeoning federal debt.

Given that our founding ancestors thought that 1-2% tax rates were excessive and merited forcible response to throw off the oppressive regime, one can only imagine what our freedom loving predecessors would be up to today.


One thing does seem certain. They would be saddened by our lack of resolve to preserve the liberty they toiled so hard to secure for us more than two hundred years ago.

Sunday, July 2, 2017

Real Independence Day?

Benjamin Martin: May I sit with you?
Charlotte Selton: It's a free country. Or at least it will be.
--The Patriot

On July 2, 1776 the Continental Congress voted on a resolution of independence proposed by Virginia statesman Richard Henry Lee a month earlier. The vote passed with 12 states affirmative and one abstention (New York would not be authorized to vote for independence until one week later).

In a letter to his wife, John Adams predicted that the 2nd of July would become a great American holiday. "The Second Day of July 1776, will be the most memorable Epocha, in the history of America," he happily wrote.

However, the draft of a formal declaration of independence, which had been written by the Committee of Five with Thomas Jefferson on point, was still under congressional review. Those changes would not be completed for two more days.

A vote on the declaration document would not take place until July the 4th.