Good Intentions

Venezuela Cleans Up After Hugo

On the heels of Rodman schmoozing with the warden of the world's largest prison colony, we have some good news from the third world.  But one of the left's favorite sons did not receive a glowing obit from the left's paper of record.  The NYT (I repeat, the NYT, friend of the left) description of Chávez:

• visceral connection with the poor, tapping into their resentments
• his followers called him Comandante
• had no qualms about using weapons to seize power
• used oil revenues to finance his desires
• nationaliz(ed) dozens of foreign-owned assets, including oil projects controlled by Exxon Mobil
• social welfare programs could be corrupt and inefficient, but they made the poor feel included in a society
• determined to hold onto and enhance his power

The WSJ who does not share ideology with this guy also notes:

• he stripped independent TV and radio stations of their licenses
• opposition politicians were limited to three minutes of advertising a day, while Chávez could commandeer the airwaves at any time
• he permitted no debates
• public workers risked being fired if they voted against him.

Weren't these the kind elections that Jimmy Carter blessed?  (For those of you not paying attention, the answer is "yes".)  Can anything be learned or concluded about President Carter's ideology from this? Are we allowed to conclude anything based on a man's actions? Or are stated good intentions the only thing that informs our judgment?  Anyway, the list of laudable accomplishments rolls on:

• despite the populism and government handouts,... the less-fortunate now endure routine food and medicine shortages
• prices are more than 20 times higher than in 1999
• the murder rate in Caracas is one of the highest in the world
• bridges and roads are in disrepair
• blackouts are routine
• untreated sewage pollutes drinking water

How on earth does this qualify him to be the "hero to Venezuela's poor" as the LA Times headline barked? These conditions are good for the poor?

What is it exactly that the left so admires about this man and other fellow sojourners like him on the left? Why would Kevin Spacey, Danny Glover, and Sean Penn visit this man? Some of this sounds like the left's fevered imaginary description that justified deep hatred of Bush. But this engenders love and admiration for Chávez? So they share Chávez's ideology or... what? I guess oil money is super nifty when you are a petrol-potentate or it is purchasing a leftist TV station. Remember, the NYT is inclined to print hagiographies of guys like this. But all they could come up with was what a rat he was?

He grew obsessed with changing Venezuela’s laws and regulations to ensure that he could be re-elected indefinitely and become, indeed, a caudillo, able to rule by decree at times.

The NYT could have saved some space on that one.  We have a nice short word for that – dictator.

The NYT continues:

He stacked his government with generals, colonels and majors, drawing inspiration from the leftist military officers who ruled Peru and Panama in the 1970s.

...often in his military uniform and paratrooper’s red beret.

Isn't the left always worried about the militarization of government? Is there no self-awareness? The ends justify the means? Pas d'ennemis à gauche, I guess.

The NYT ended with psychiatrist Dr. Edmundo Chirinos's assessment: “a hyperkinetic and imprudent man, unpunctual, someone who overreacts to criticism, harbors grudges, is politically astute and manipulative, and possesses tremendous stamina, never sleeping more than two or three hours a night.” The WSJ concludes with: "As life stories go, the lesson of Chávez's is to beware charismatic demagogues peddling socialist policies at home and revolution abroad." That is, if we can conclude anything from results and not just intentions.

You Didn't Do That

Olympics demotivation you didn't do that

Think Like a _______ Person

The right thinks that people should be regarded not based upon their ethnicity, sexual preference, gender, social status, skin color or other physical characteristic but on shared values and the content of their character.

It is the Left that argues that every gay person must think like a leftist.
It is the Left that argues that every black person must think like a leftist.
It is the Left that argues that every woman must think like a leftist.
It is the Left that argues that every Hispanic person must think like a leftist.
It is the Left that argues that every poor person must think like a leftist.

Julia - Cradle to Grave

Ross Douthat takes a look at the Obama campaign's Julia ad.

What’s more, she seems to have no meaningful relationships apart from her bond with the Obama White House: no friends or siblings or extended family, no husband (“Julia decides to have a child,” is all the slide show says), a son who disappears once school starts and parents who only matter because Obamacare grants her the privilege of staying on their health care plan until she’s 26.

Its all about her. Kinda self-centered, right?

He goes on:

In addition to ignoring the taxes that will be required of its businesswoman heroine across her working life, “The Life of Julia” hails a program (Head Start) that may not work at all, touts education spending that hasn’t done much for high school test scores or cut college costs, and never mentions that on the Obama administration’s own budget trajectory, neither Medicare nor Social Security will be able to make good on its promises once today’s 20-something Julias retire.

Would the ad be as effective if Julia's name were José or Shaniqua? Doesn't the Obama campaign care about minorities?

Down With Capitalism

Chris Carrado has a great article that examines some of the motivations behind the Occupy Wall Street movement:  the left hates inequity in results more than it loves liberty, they hate profit more than they love freedom in markets.

If a company earns millions in profit because it develops a revolutionary medical device that saves thousands of lives, has it not paid its fair share? If a company produces a chemical that kills 99.5% of bacteria in farms, has it paid its fair share? If Ford creates a car so safe that it prevents 80% of otherwise fatal auto accidents, has Ford not done enough? If a grocery chain brings us a bounty of diverse, healthy foods we can purchase without the cost and effort of growing them ourselves, do we think we're also entitled to the profits it brings that chain?

What Everybody Owns, Nobody Owns

Collective ownership didn't work at Plymouth Rock. John Aman shares the collectivist failure that occurred under a charter which imposed a seven-year period of joint ownership on the original settlers at Plymouth Rock.

Governor Bradford wrote that common ownership "was found to breed much confusion and discontent, and retard much employment which would have been to the general benefit and comfort."

After much debate, Governor Bradford

allowed each man to plant corn for his own particular [for his own household] and to trust themselves for that ... so every family was assigned a parcel of land, according to the proportion of their number ... this was very successful. It made all hands very industrious, so that much more corn was planted than otherwise would have been by any means the governor or any other could devise.

When the incentive for personal gain is removed by collectivist economies, stewardship of the property does not occur as readily when one directly benefits from his/her own labor. It flies in the face of human nature to believe that a person will work as hard for the benefit of a stranger as he will for himself or his family.

The Pilgrims were much more successful when the political economy aligned with human nature and acknowledged that incentives do matter.

Mike Rosen often uses an analogy to demonstrate the differences in stewardship between collective ownership and individual ownership. He notes that public restrooms are often dirty and have graffiti on the walls. But have you ever seen graffiti on the walls of a private home?

The Occupy Wall Street demonstrators inadvertently confirmed this idea with their stewardship of the public spaces they occupied. The destruction and fouling of many of the occupied areas is positive proof that when everybody owns it, nobody owns it. They are able to just walk away from the problem rather than deal with it.

Capitalism recognizes this tendency of human nature.

Affirmative Action for the Ugly

Once again, The Onion is eclipsed by the New York Times. Daniel S. Hamermesh questions whether certain EEO actions might be reasonable based on ugliness.

...why not offer legal protections to the ugly, as we do with racial, ethnic and religious minorities, women and handicapped individuals?

We could even have affirmative-action programs for the ugly.

For purposes of administering a law, we surely could agree on who is truly ugly, perhaps the worst-looking 1 or 2 percent of the population.

This is a powerful example of the conflict of visions that exists between conservatives and liberals. One side seeks to impose equivalence via government coercion and lawsuits and the other does not. One side says the government should be the arbiter of morality while the other does not. One thinks in terms of groups while the other does not.

An important issue was noted near the end of the article. Often, the left does not acknowledge that incentives matter. In the case of taxation, they often dismiss the chilling effect that higher tax rates can have on investment and economic growth. They often poo-poo the idea that the wealthy may decide to change their behaviors if tax rates are to high. But in his article about ugly people, Hamermesh notes that incentives certainly do matter:

There are other possible objections. “Ugliness” is not a personal trait that many people choose to embrace; those whom we classify as protected might not be willing to admit that they are ugly. But with the chance of obtaining extra pay and promotions amounting to $230,000 in lost lifetime earnings, there’s a large enough incentive to do so.

Hamermesh feels that the ugly among us will embrace their ugliness if lured out with the prospect of financial remuneration. If true, those on the left should certainly concede that confiscatory tax rates, 90 weeks of guaranteed income in form of unemployment insurance and paying no taxes at all (as about 50% of Americans do) may in some way affect the decisions that people make.

For those who still possess some modicum of shame, they would likely not be able to expose themselves to the crushing humiliation of asking for a handout because of their uncomeliness. Their self-esteem is likely fragile as it is and having to be judged by some pulchritude panel may be more than they can bear. But those without shame would be lining up with their hands fully extended to exploit this program of good intent. I suppose those with face tattoos, meth mouth and other self-imposed disfigurements could benefit from this as well.

But Hamermesh places a low percentage on who would be eligible - one or two percent. So the competition would be steep for those racing to the bottom of the beauty pool. And given the track record of other public programs, we can all sleep well knowing this number would likely not grow and costs would be contained. For those of you enamored with large government programs, that was a joke.

As many ideas and programs of this nature, it stages - whether intentionally or not - a race to the bottom. It does not elevate people. It creates a culture where we are told to gather based on our shared grievances.

Soak the Rich

The politics of envy clouds the judgment of the left. Because they are looking for a silver bullet to fix budgetary problems, they seek to push the debt problem onto the backs of the rich. As Bill Whittle demonstrates in his YouTube video, Eat The Rich, all of the earnings and wealth of the rich could be confiscated and it would not come close to solving the problem.

Much of the politics of envy is driven by a blind desire to take from those who have more and redistribute it to those who have less. As the maxim goes, "from each according to his ability, to each according to his need."

I suppose this could be chalked up to noble intent, but there are glaring examples where the left reveals that this might not be a deeply held belief. Because when their ideas are applied to them, they immediately rebel against it.

When is it applied to them? Healthcare.

There are many reasons that the cost of healthcare is high in America, and cost transfer is certainly a large contributor. The burden that caring for illegal aliens imposes on the system is just one example of this transfer and why costs and insurance premiums are higher than they should be.

Reimporting drugs is another slight of hand that the left likes to recommend when asked for cost cutting measures. This article by Mac Johnson sums up why it is a bad idea. But drug reimportation is a great example of where the left bristles against their own policy prescriptions.

When compared to the rest of the world, America is the rich. America subsidizes the cost of medicines for the rest of the world. This is a wonderful global expression of "from each according to his ability, to each according to his need." The left should be championing the higher cost of prescription drugs as an example of good redistributive policy.

But when the shoe is on the other foot and those who champion eating the rich are what's for dinner, they cry and moan and seek any means possible to avoid being eaten. Apparently what's good for the goose is not good for the gander.

Yet another example of the left's lack of self-awareness.

Getting Along

This is, I think, a 50/50 country and we don't quite know which side is going to come out on the 51/49 side when we run the numbers. And what's problematic, I think, is that we are a house divided – to resurrect Lincoln – we are a house divided.

But we are divided about the nature of the state itself, which is the most fundamental division of all. Its not really like a division between rich and poor, or between black and white. Americans are divided on the kind of republic the United States should be. Whether it is still a republic of limited government and a self-reliant citizenry that is free to live lives to their fullest potential. Or whether it is just a kind of larger version of Sweden.

...But the problem is there's not a lot of compromise between those two visions.

...Those are two incompatible visions of America.

Mark Steyn on the Mike Rosen Show, 12 Aug 2011, H2, 5:56

Cheap Labor

Is the myth of cheap labor just transferring the costs to the public at large? Is it a case of pay me now or pay me later? That is, if we paid more for the goods and services that are produced with "cheap labor" now, could we avoid much of the socialized spending later?

Dick Lamm has a good article on this here. He articulately and thoughtfully examines some of the cost multipliers of "cheap" illegal labor. Its an oldie but a goodie.

Defenders of illegal immigrants call any and all concern about this issue “racist,” and attempt to take the issue completely off the table.

To continue to tolerate this practice is not only a legal issue; it is morally unfair to those waiting to come legally.

But that is not to say it is “cheap labor”. It may be “cheap” to those who pay the wages, but for the rest of us it is clearly “subsidized” labor, as we taxpayers pick up the costs of education, health, and other municipal costs imposed by this workforce.

The very people that liberals profess to speak for and care about pay the price in lost and suppressed wages while employers get the benefits of reduced wages.

The health care cost of this illegal workforce is also significant and also subsidized by U.S. taxpayers.

I have been fighting all my life for universal health care, but we can't have “the best health care system in the world” combined with Swiss cheese borders.

Ironically, the price of compassion is restriction.

By tolerating illegal immigration are we laying the foundations for a new Hispanic underclass?

You may have seen emails circulating around the internet that tick off the hidden costs to cheap labor. Some of the hidden costs to cheap labor include:

• Earned Income Credit
• Section 8 housing
• Food Stamps
• School breakfast and lunch
• Bilingual education
• Energy bill assistance
• Emergency room healthcare
• No car/life/homeowner's insurance
• SSI
• Medicare/Medicaid

Instead of paying for these items at the point of purchase in the form of higher prices for goods and services, these costs are paid through higher taxation. The costs will eventually be paid. But instead of paying them directly through the private transaction in a free market, they will be paid through a governmental income transfer.

If redistribution through taxation is the model one desires, then the status quo is an excellent way to achieve it.

Notable Quotable

If there were a contest for the most misleading words used in politics, "poverty" should be one of the leading contenders for that title.

If government programs were confined to people who were genuinely poor in some meaningful sense, that would shrink the welfare state to a fraction of its current size.

People who say they want a government program because "I don't want to be a burden to my children" apparently think it is all right to be a burden to other people's children.

Thomas Sowell, Misleading Words: Part II, 2 Aug 2011

Union Hysteria

President Obama called the bill an “assault on unions.” Democratic state senator Lena Taylor compared Scott Walker to Hitler. But the results of the changes in Wisconsin were not nearly so terrible.

From the Weekly Standard:

On June 29 at 12:01 a.m., Koczela could finally breathe a sigh of relief. The budget repair bill​—​delayed for months by protests, runaway state senators, and a legal challenge that made its way to the state’s supreme court​—​was law. The 27 teachers on the chopping block were spared.

With “collective bargaining rights” limited to wages, Koczela was able to change the teachers’ benefits package to fill the budget gap. Requiring teachers to contribute 5.8 percent of their salary toward pensions saved $600,000. Changes to their health care plan​—​such as a $10 office visit co-pay (up from nothing)​—​saved $200,000. Upping the workload from five classes, a study hall, and two prep periods to six classes and two prep periods saved another $200,000. The budget was balanced.

In Brown Deer and school districts across the state, Walker’s budget repair bill, known as Act 10, is working just as he promised.

Were the unions and their supporters who stormed the capitol and those senators who left the state simply overwrought in their rhetoric, incapable of understanding the proposed fixes or stumping for their special interest? Will there be any apologies and realizations that the anger was all on one side on this issue?

From the Washington Examiner

But after the law went into effect, at 12:01 a.m. Wednesday, school officials put in place new policies they estimate will turn that $400,000 deficit into a $1.5 million surplus. And it's all because of the very provisions that union leaders predicted would be disastrous.

In the past, teachers and other staff at Kaukauna were required to pay 10 percent of the cost of their health insurance coverage and none of their pension costs. Now, they'll pay 12.6 percent of the cost of their coverage (still well below rates in much of the private sector) and also contribute 5.8 percent of salary to their pensions.

But when the Milwaukee teachers’ union president Bob Peterson was asked “You have a choice: layoffs or pension contributions. Do you see that choice? Why did you make a choice of layoffs?” when collective bargaining resulting in layoffs, the union president said, "I didn’t lay off anybody,”

Who was it in Wisconsin that kept teachers employed, pensions in place and the fiscal house in order? The union assaulting Hitlarian governor? Or the union?

Right Wing Myths

The following article was forwarded by a friend. The article is reproduced in its entirety with my comments embedded.

Deconstructing Right-Wing Myths About Socialism, Capitalism, and Who The ‘Job Creators’ Are

Conservatives have taken to a new spin on truth, by refashioning definitions of words and terms in order to provoke new connotations. Socialism is now defined as a government take over, Capitalism is now defined as patriotic, and the wealthy are now defined as job creators. But simply redefining these words will not change their true meaning, it is only myth making.

If the author is suggesting that these ideas are new, he is right if by new he means since 1776 when Adam Smith wrote Wealth of Nations. Or the years preceeding this milestone, since surely the ideas were floating around prior to Smith writing them down. And the author's rebuttal of the ideas is not new since the most thorough and enduring critique of the results of capitalism was given by Karl Marx in the late 19th century.

Just because the author disagrees with some aspects of Capitalism does not render the ideas mythical. Just as there is value in some aspects of socialist commentary, so there is value in certain capitalistic aspects. Polarizing the issue will create more mythical dogma than an honest discussion of controlled vs. free economies.

Surely the author is aware that the US economy is a mixed economy. The markets are not "free" in the sense that they are unregulated. A quick examination of the Federal Register will disabuse the reader of any notions that the economy is not at least well regulated and possibly highly or over regulated.

Socialism does not mean the abolition of a free market society, nor does Socialism call for a government takeover of all industry; that is Communism.

It is refreshing to see a reasonable definition of Socialism presented. The classic dictionary definition does identify the "collective or governmental ownership and administration of the means of production and distribution of goods." Those on the left in America tend to use this as evidence that the policies pursued by those on the left are therefore not Socialist. However, the term has somewhat evolved over time and the author makes an important distinction between Communism and Socialism. A better definition may substitute "the most important industries are owned or controlled by the whole community" for ownership of means of production. Certainly Europeans understand this concept since they have parties with the word Socialist in the title and yet they are not advocating the total takeover by government of the means of production. It is possible to regulate or administer industry to the point that Socialism is achieved without actual ownership by the government.

It is difficult to have meaningful conversations about anything if the definitions of terms cannot be agreed upon. To be sure, the right wants less government control moving toward the ideal of capitalism and freer markets while the left wants more government control moving toward the ideal of socialism and egalitarianism. As the author so adroitly points out later in the article (a point that I incessantly make with the hope of fostering meaningful interactions by de-fanging both sides of the issue), "Capitalism is neither right nor wrong, it is simply an economic term." Similarly, socialism is neither right nor wrong, it is simply an economic term. If economic concepts and models cannot be summarized into generalized terms, what hope is there of discussing anything? Growth in thought and understanding cannot be achieved if we must restate a thesis in its entirety and are not allowed to use terms that generally encapsulate an idea or body of ideas.

Therefore I applaud the author’s candor and willingness to view the terms as descriptors rather than pejoratives.

Socialists acknowledge the limitation of a free market and believes that some industries should not be run for profit. Police protection, fire protection, prisons, education, health care, parks, electricity, water supplies, waste and sewage removal, and roadways are just a few examples of industries which should not be run for profit. The reasoning behind this belief is when these industries are operating for profit, not only will prices rise, but corresponding services would then be reserved only for those who can afford them.

This assertion does not account for competition, price setting and other market forces. Certainly, if a producer of goods is solely motivated by profit and is a price setter, this could lead to ever escalating and out of control prices. However, these are two assumptions that are not borne out by experience.

An understanding of price setters and takers is necessary. A company that is able to dictate the price its customers pay for goods and services is a price setter or price maker. All other companies that are competing in a similar market where similar products are readily available elsewhere are price takers. For example, a company that is selling computers cannot set the price arbitrarily high if others are competing for a market share. If it does, it will not sell units because the consumer can go to the competitor and receive a similar product for less. Therefore, the first seller is forced to lower prices to a market clearing price. That is, a mutually agreeable price is reached between buyers and sellers. This price is determined by the cost of manufacture, the perceived value of the product, profit, etc.

Any company that is producing something will necessarily maximize profits for the shareholders. However, this is limited by how much a buyer is willing to pay. If a TV manufacturer decides to include a 100% profit in the price of its TV, the buyer may decide that the added value of having a TV in the home is not worth the price. This desire to price set is mitigated by the market when another company sells the product cheaper – maybe deciding to produce the product with less profit. The second company can undercut the competition and gain a larger portion of the market share. This will have the effect of driving down prices at the first company if they want to stay in business.

Price setting generally occurs with monopolies, companies that are producing something that is so unique that there is no competitor making a similar product, collusion, etc. For these reasons and others, governments are likely to be price setters. (e.g., government monopolies are often established by law for various reasons.) The only relief for the consumer is for him to not purchase the product or service. However, since governments tend to control necessity items and/or items that are mandated by law, the consumer is not as free to make value/price considerations.

The author’s assertion that operating for profit only results in higher prices disregards market forces and empirical evidence to the contrary. It could be just as easily asserted that the monopolistic, regulatory and price control characteristics of government lead to higher prices.

Or more succinctly, no one person should be able to profit over running services, in which everyone benefits from.

The assertion here focuses on "no one person." Corporations do employ CEOs and the like, but shareholders make up a much larger portion of those benefiting from the profits of an organization. The elderly woman who holds stock in her retirement account for a corporation is certainly hoping for profitability to sustain her retirement.

And where does this line of reasoning stop? How is “in which everyone benefits from” defined? What portion of society must benefit to qualify? Certainly the author would therefore condone the socializing of the production and distribution food, heating and air conditioning, automobile, energy (including oil, gas, coal), and many other goods and services. All one has to do to turn control over to government is make the case that “everyone” benefits.

One excellent example of Socialism in action is demonstrated in our banking industry. While most banks operate for the profits of their CEOs,

If the author believes that the sole reason to exist is to operate for the profit of the CEO, there is no refutation possible for this belief. Certainly some take advantage of systems and try to get as much money as possible from the system, this does not therefore justify the tarring of an entire industry. Just as some lawyers appear to be heartless, soulless people that would sue their own grandmothers, this does not therefore mean that all lawyers are evildoers. Most people try to maximize their take for their efforts. Labor unions do exactly this when they lobby to mandate certain rules in the workplace. This does not necessarily obviate their efforts or necessarily make them evildoers.

credit unions are owned and operated by the people. The profits which are not imparted upon CEOs are reflected back to the customer in higher interest rates for investments and lower interest rates for loans. It may be important to point out that credit unions did not run the same risks as banks when our financial bubble burst, and thus did not need to request nor receive any TARP bailout money. Nor have the credit unions contributed to the faulty foreclosures as our banks have.

The credibility of the author is at risk if he is making the case that profits were the primary reason for the "financial bubble." I am no fan of extremely high compensation for executives, especially if it comes by deliberately and intentionally manipulating accounting to hit earnings targets so that senior management can maximize the bonuses and other executive compensation they receive, at the expense of shareholders. But this is exactly the source of the $90M received by Franklin Raines while he was in charge of Fannie Mae. And his support and implementation of policies to ease credit requirements on loans that Fannie Mae purchased from banks that were "a notch below what our current underwriting has required" may have contributed at least as much to the foreclosure problem as his extravagant $90M bilking of borrowers and the $400M civil fine paid by Fannie Mae.

Furthermore, the author has unwittingly made a good case for not socializing banking. He appears to be arguing that by removing bureaucratic control and decentralizing the decision making by placing it in the control of those who are most interested in conservative and judicious use of the assets - the consumer - that tragedy can be averted.

Another example is found in health care. The free market creates for-profit businesses ranging from medications, medical testing, medical treatments, medical research, to hospitals. None of which have lowered the cost of health care through innovation or through competition.

Absent a parallel universe, how can this statement be made with certitude? The medical cost issue is complicated, messy and needs an intervention. However, to assert that competition and innovation are not fostered by free markets strains credulity. Does competition and innovation bring about the lowering of cost in any other arena? Are groceries cheaper, better and more available because of competition? Does this inability of the market to reduce prices only exist in healthcare? And if so, why? It may not exclusively be the free market aspects that are messing up the healthcare industry. Could regulation and rule making play any role? It is likely not all one thing or the other. This is an incredible statement for the author to make.

This is because the demand of which is a basic necessity, or in other words is non-negotiable. Like clean water, oil, and electricity, humans cannot survive without such products or services. The demand of which is a constant, therefore they are not subjected to the Keynes supply and demand curve. When prices go up, demand does not lessen beyond a certain threshold. Americans may forgo a pleasure trip to conserve on gasoline consumption, but their demand for gasoline to take them to and from work is non-negotiable. Where the free market brings economic ups and downs which effects everyone, Socialism believes that there is a limit on the protections a free market provides. And quite simply, some things should not be run for profit, especially at the expense of everyone else.

The author’s primary objection appears to be profit. Profit in and of itself is not evil. I am sure the author allows that some profit is good. Labor unions want profit for the workers. They certainly want profit for the union itself, at the expense of everyone else. That profit is useful since much of that profit is used to influence elections in the form of political contributions and donations that help to elect politicians that create laws that ensure higher profits for the union members and therefore for the union.

This fixation on profit alone is fallacious. Is the author contending that the elimination of profit equates to the elimination of wrongdoing, waste, fraud, incompetence, and a whole host of other human frailties? The Franklin Raines debacle recited earlier should demonstrate that the ability of a company to make a profit is not the sole source of the author’s discomfort since Mr. Raines conducted his dealings in a quasi-governmental organization, under the watchful eye and collusion of OFHEO officials, and is a fellow of the left. If anybody should have been able to avoid this sort of exorbitant behavior, it should have been Mr. Raines and especially the co-conspirators at OFHEO. Failed human character might be a better place to point one’s finger.

If bad character is universal, it will crop up in corporations and government with similar frequencies. If not, are we to believe that something draws the seedy crowd to the private sector with greater frequency? Is it profit? But many would argue that power is more alluring even than filthy lucre. Is power as intoxicating to the politician as profit is to the businessman? And as corrupting?

Would the author argue that only the righteous enter politics while the immoral enter the private business world? Does this explain why, as the author proffers, if profit were removed and the government produced and distributed “some things” that prices would lower and quality rise? How is this squared with all the waste and fraud that leaders say they will excise from Medicare and Medicaid programs in order to lower costs and fund increases in benefits? Since profit couldn’t have produced the waste and fraud, from whence did it burst forth? It is a silly notion to think that corruption, greed, avarice, vice, et al. can be expunged from humankind by simply removing profit.

The Founders sought to minimize corruption and other vice by encouraging healthy religion to attack the moral problems of humanity. This is made clear from statements such as this one by John Adams:

“We have no government armed with power capable of contending with human passions unbridled by morality and religion.”

If the left wants to argue that religion is an antiquated method of moral conditioning that is no longer needed, that is fine. But moral conditioning will need to continue somewhere and somehow. The author is engaging in it when he makes moral judgments about profit. The reality is that if religion is not heavily relied upon as a co-worker in forming a good, just and moral government, then the government itself will have to take on the role of moral conditioner by imposing moral codes in the form of laws. If religion ceases as the primary agent of moral conditioning then government must take up the task. The moralizing of the left about not using government to legislate morality is hard to understand when the only avenue allowed by leftward policy is to have the government fulfill that role and, in fact, legislate morality. (This brings up interesting church and state discussions.)

Merely removing profit from the economic equation will not prevent bad bahavior.

Furthermore, when the author states that “some things should not be run for profit,” who shall decide which things are profit worthy and which aren’t? And if it is immoral to allow profit for this select group of chosen tasks, why would it be moral to allow any industry to function with profit?

Capitalism is an economic term for the free market system which is structured upon the accumulation of money, where the means of production are privately owned and operates for profit. Capitalism is neither right nor wrong, it is simply an economic term.

As noted earlier, kudos to the author for de-fanging the terms and allowing the use of terms as descriptors and not as pejoratives. Similarly, it is OK to discuss aspects of the left in America as socialism in the modern, European socialist sense. It is also OK to discuss the writings and ideas of Marx and draw comparisons between some of his work and aspects of the American left. His ideas are legitimate explanation of a particular political economy. Referencing his work is not intended as an attack of character but rather a reference to a concise explanation of a particular political economy. To note that the left shares the Marxian maxim “From each according to his ability. To each according to his need.” is not to attack the motive and worth of the person of the left, but is rather a concise statement of a fundamental belief and value held by the left. Why isn’t this association embraced and acknowledged by the left just as the right acknowledges Smith’s enlightened self-interest? Why does the left consider somebody that they largely agree with on economic matters to be taboo?

Nor is Capitalism patriotic!

If patriotism is defined as “a feeling a lot of love, respect, and duty toward your country”, then both sides of the issue can of course be patriotic. But, the Howard Zinn view of America, which is widely taught in schools using his textbook “A People’s History of the United States,” is that America has done more bad than good in the world. He thinks that the the policies and values of the Founders would better be replaced with democratic socialism.

It is hard to imagine a person loving and respecting a country that he believes has done so much evil and deserves such widespread condemnation. Could it be said that conservatives are in love with what America has been and would like to preserve its better aspects while progressives are in love with what America could be if it were fundamentally changed? Fundamentally changing America was, after all, one of President Obama’s campaign slogans. Should a conservative be faulted for taking the President at his own word?

Of course liberals can be patriotic. And conservatives that pretend that patriotism is the exclusive province of conservatism are over stating, or perhaps simplifying, an argument. But in light of much of the self-flagellating and America bashing of the left, there might be some nuance here that should be considered and understood. It seems clear that somebody who thinks America is exceptional is in love with Americanism. It is not so clear that the person who is highly critical and angry about American injustices is in love with Americanism.

And, of course each side is going to view support of their preferred political economy as more patriotic since, ostensibly, they support that economic model because they think it is more fair, just, right, better than the other and better reflects American values. And believing that something is a better option certainly would lead to a feeling of love, respect and duty toward the society that it supports.

A system which encourages the accumulation of wealth does not salute a flag, nor is it loyal to a native country. This market system crosses state and national borders in order to provide larger profits for business owners. If labor costs are cheaper overseas, then it is capitalism which will drive businesses out of our country.

The alternative to this is to prevent businesses from seeking cheaper alternatives in other countries. Again, the author assumes that profit is the only criteria considered by businesses. Walmart is a testimony to what the consumer prefers - lower prices. Laws can be passed preventing Walmart from seeking lower costs by mandating that all products sold on their shelves must be produced in America with higher labor costs, but the price of everything will increase in spite of any profiteering that may occur. Profit aside, this protectionist concept will increase prices and defeat the author’s intent. Additionally, forced increases in labor costs imposed by unions have the effect of driving industry overseas to cheaper labor markets in an attempt to control costs. Again, this can be prevented, but at a cost.

If a company finds it cheaper to produce a dangerous product than it is to produce a safe one, it is capitalism which will produce the most profitable option without consideration of customer safety.

Companies that produce unsafe products do not stay in business very long. So any profit realized will be short lived. This line of thinking assumes that businesses are so corrupt or inept that they will continue to produce unsafe product thereby jeopardizing their future profit in spite of what consumers want. This is not to say that unsafe products are not produced by business. They certainly are. But it is not capitalism that is the root of this behavior. Many government bureaucrats have accepted or approved inferior work on the taxpayer's behalf.

Capitalism only seeks profits

This is a trite and irresponsible comment. Would the right be correct to say that socialism only seeks to destroy prosperity?

and will by nature migrate operations towards areas which promotes greater profits. Capitalism has no allegiance to any one country as it operates in a global economy. Again, capitalism has no allegiance with patriotism. Where would a business find themselves most profitable? Would they find a country with extremely lower labor costs to be more profitable for manufacturing than a country with higher labor costs? Would they find a lower taxed area more profitable than an area with high demand for their products? But most of all, wouldn’t it be more patriotic for an American business to spark demand in order to operate, manufacture and sell their goods or services inside America, as opposed to overseas?

This might be ideal, but some onus must be placed with the consumer. Consumers are at least equal players in this interaction. The author will later make the case that consumers are in fact the job creators by creating demand. These demand creators also demand lower prices. And because consumers prefer lower priced items, market feedback pushes business to meet that need. If the author's later argument with regard to job creation is to be taken seriously, then the consumer must be at fault here, not the business that is simply responding to the consumer's demand.

I wonder if the author is in favor of lowering the price of prescription drugs? Or re-importing them from Canada? If so, he is violating his own prescription for lowering prices and counter-acting profit. The prices are higher in America in part because the companies are covering their costs. Other countries don't respect patent law and reproduce the drugs in defiance of the pharmaceutical companies that spent all the money to develop the drug. Profit is part of the equation, but does the author wonder why the pharmaceutical companies aren't sticking Canada with the profit? And if safety is a concern, is the author prepared to trust China with the production of his medicines or would he rather pay a higher price to pay Americans to produce quality drugs. Using the author's reasoning, that would also be more patriotic.

The wealthy are not necessarily the job creators. Poor and desperate innovators have sparked many new business ventures despite their lack of wealth. Many small businesses began out of practically nothing, but only an idea executed inside of their garages. The fact of the matter is that neither wealth nor lower taxes create jobs; only demand creates jobs. This little tidbit of truth is lost in translation when the wealthy are deemed as “Job Creators”. This ploy is used to promote additional tax breaks for those who already have enough and while promoting cuts in public services on those who do not have enough.

When the luxury tax was imposed on yachts and the rich stopped purchasing yachts in America, who lost their jobs? The non-wealthy yacht makers. This is job creation from the demand side. When those garage businesses want to expand their idea and employ the masses, where do they acquire the capital? Even universities must find a sugar daddy to fund their research. It cannot be done without wealth. So those that are good at creating wealth should be encouraged not vilified.

Another tidbit of truth which is diluted in this argument is the inequality of income between the workers and the owners. A manager typically earns 343 times more than an average employee. And while 88% of domestic profits go to corporate bank accounts and CEO bonuses, only 1% of these profits gets applied towards labor. The business owner shoulders no responsibility for producing any product or service.

This reveals a profound lack of understanding about what it takes to run a business, oversight of capital and the difference between physical and intellectual labor. If this statement were absolutely true, wouldn't some good leftist have slapped his forehead and fired all of this needless overhead and let the business run itself? This is not acknowledging the enormous risk of ownership nor the intellectual contribution. Does the author suggest that since Stephen Hawking does no hard labor that his contribution is meaningless? Or that he has no responsibility for producing any product or service? Or that Hawking should not be compensated at a higher rate for his specialized labor?

Rather the business owner invested their money (and in most cases time) into a business which is productive.

Well, when the business is successful. What about the multitude that try and fail? And lose their life savings? Just investing cash does not a successful business make.

Productivity is a result of the balance between the investors, the managers, and the workers. It is a symbiotic relationship, which many Americans cannot conceive of. For where would any business be without any one of these three elements? Despite conservative talking points, even the lowest of employees is an invaluable asset to a business. In a restaurant, an effective business owner knows that the dishwasher and busboys are just as important to their operation as their managers and customers. If you remove the dishwasher and/or busboys from the equation, the business suffers. Yet an effective manager can be absent from their responsibilities and the operation should not be sacrificed.

This is an amazing statement. It is hard to imagine that the author has ever worked in the private sector. But even if he hasn't, even in government good managers are hard to come by. In the case cited, a busboy is an example of low skilled labor. And yes, even though the busboy is integral to the success of the company, the pool of potential candidates for this job is almost limitless. Accountants, however, are not so plentiful. Supply and demand alone suggest that a busboy can be hired at a lower rate than a skilled manager or accountant.

And again, if the manager can be AWOL with no impact to the business, why hasn't somebody other than the author figured this out? Certainly a greedy business owner would realize that he could add the cost of the manger to his profit margin if the manager is as useless as the author suggests.

So which employee should be valued more than the other, the laborer, the manager, or the investor? The answer is neither of the three. For without one, the other two would not have a business operate or a job to tend to. Yet the argument goes that only the wealthy create jobs. Without enough demand, even these jobs won’t last very long.

We should not tax our job creators in a time of economic recession. But we have misidentified exactly who these job creators are. When our recession is being prolonged out of a lack of demand, it is not the business owner who can create jobs. But rather it is the customers who spurn on demand who create jobs. The businesses who pocketed great sums of cash during our economic catastrophe will still be there when we come out of it without the need to create more jobs. But these businesses will find themselves with greater profits when demand picks up again, and that is what will create jobs. So let’s not overburden our true job creators, the customers. In order to spark higher demand, we must effect the largest target market we have at our disposal. It’s not the wealthy who can spark this demand; they only constitute up to 2% of our populace.

It is comforting to see the admission that the wealthy are at most 2% of the population. This group already pays about 38% of ALL income taxes. Even if all of their money were taken, there would not be enough to cover the current levels of indebtedness. And, even though, according to the author, this group doesn't create any jobs, they are free to move their wealth when taxation becomes too onerous. And if that 2% is as worthless and parasitical as the author suggests, it may be an advantage to have them all leave. But then, who would we tax when the group that currently pays 38% of the entire tax burden - and the group who legislators wish to further tax in order to get them to pay their "fair share" - is gone, or stops investing because it makes no economic sense to risk their wealth?

Rather, we should focus our attention on the other 98% of our populace, our struggling middle class and poor. Henry Ford believed that his product meant nothing unless there were customers who were able to purchase it. In order to ensure his company’s success, he paid his laborers more than other businesses, so they may buy his cars. This enabled his employees to comfortably afford to buy Ford products. This sparked higher demand, which in turn produced higher job growth. Which led to Ford’s success story. Henry Ford did not believe in paying the least amount possible for labor, eliminating the minimal wage, or acquisitioning higher profits. Instead he realized the symbiosis between business and labor and between the business and its customer.

He also said "We try to pay a man what he is worth and we are not inclined to keep a man who is not worth more than the minimum wage." His view of symbiosis was largely merit based and did not shrink from releasing those that did not meet his needs for production.

Good businessmen will treat their staff kindly and the best they can. The decision is the business owner's, but I agree with encouraging businesses to treat the employee as good as possible. This leads to satisfied and happy employees. With this aspect of Ford's - and the author's - ideas, I agree.

As for the input of an owner, Ford disagreed with the author's sentiments when he said, "The hours of labor are regulated by the organization of work and by nothing else. It is the rise of the great corporation with its ability to use power, to use accurately designed machinery, and generally to lessen the wastes in time, material, and human energy that made it possible to bring in the eight hour day." Ford thought there was some worth to his input as an innovator, manager and organizer and that the business would not simply run itself with the addition of unending waves of labor.

Ford is a great case study to help understand the difference that an observer's ideology can make. Ford had some good and some bad in what he did. Owing to his ideology, the author is going to see much of what Ford did as supportive of leftward ideals. Everyone does this - me included. We interpret the world through our understandings, beliefs, desires, ideology, etc. Any successes on the part of Ford are going to be chalked up to adherence with the observer's ideals. A leftist and a rightist are both going to look at the same evidence and come to much different conclusions because of their different view of humanity, incentives and other factors.

As the author noted, this doesn't make either one correct or incorrect. But each side does have real and significant ideas on what motivates people in a political economy and the proper role of government. Although it is not likely that ideologues on either side will be persuaded by the other's recital, each side should strive to present their ideas in a rational and respectful way. And for this the author is to be commended.

It is good to understand where each side disagrees with each other. Understanding ideological differences brings clarity to the discussions. And that is a good first step.

WWJD

There is a lot of WWJD talk being used to justify policy these days.

Lawrence O'Donnell on MSNBC.

While Jesus may not have specified specific tax brackets, He was the first recorded advocate of a progressive income tax.

Obviously, He [Jesus] would take from each according to their ability to pay. That is the clear, Christian, philosophical basis of a progressive income tax.

Jesus Christ's instructions to you could not be more specific. You can follow Christ's path to righteousness or you can follow the path of the damned. The choice is yours.

Rep. Charlie Rangel

What would Jesus do this weekend?

Eric Sapp/Thom Hartmann

In Matthew 25, which is to my recollection, I've only read the Bible four times, but, the only time when the Disciples actually sat down with Jesus and said, "How do we get into heaven?" And He said, "Here's the list. Feed the hungry. Clothe the naked." The modern equivalent would be, you know, house the homeless. "Heal the sick. Visit those unjustly in prison."

The Hill

Jesus taught we should sell our possessions and give the proceeds to the poor...

Are they advocating for a religious state? One that operates straight from the precepts of Jesus? A theocracy? Christian Sharia law?

Ken Shepherd at NewsBusters does a good job of deconstructing O'Donnell's sermon.

There are a few assumptions that go into these presentations of WWJD that preordain the conclusions drawn by those cited above:

1. That Jesus was directing his comments to the state not the individual.
2. That the state is the singular method of helping the poor and Christian charity.
3. That those who don't think that the government should be the charity arm of the Christian church are mean and selfish.
4. It is OK for to judge the motives and eternal salvation of limited government capitalists and the rich.
5. There is no room for alternate interpretations.
6. The separation of church and state is only meant for 'those other guys.'

...I contemplate with sovereign reverence that act of the whole American people which declared that their legislature should 'make no law respecting an establishment of religion, or prohibiting the free exercise thereof,' thus building a wall of separation between Church & State.

~ Thomas Jefferson

Those represented in the links above might believe that Jesus mandates that the government be a branch of the church, but this strains credulity since they are all people of the left. Traditionally, those on the left interpret Jefferson's statement to the Danbury Baptists to mean that even a creche cannot be placed in front of a government building or that circumcision is a primitive religious rite that should not be subsidized. Surely, if placing a creche in front of the courthouse next to Santa and his reindeer creates church/state entanglement, using the government to carry out a central doctrine of the Christian church is problematic. In the past, the left was satisfied with merely taking the responsibility away from the church and making it their own without the pretense of religiosity. Apparently that was then and this is now.

In his discussion with Thom Hartmann, Eric Sapp notes that hypocrisy is the only "sin in the New Testament that gets the divine death penalty." One wonders if Mr. O'Donnell will spend 10 minutes Bible thumping to his fellow sojourners on the left about how hard it is to get through the eye of a needle and sure fire methods of avoiding God's wrath, including "Give up everything. Those are the words of Jesus Christ. Give up everything."

It would be the Christian thing to do.

Ayn Rand and Jesus

Eric Sapp/Thom Hartmann wrestled with the idea of whether one could like anything that Ayn Rand had to say and still be a Christian. It was a discussion aimed at those swing voters who do not have a fixed notion of what they think the role of government should be with respect to charity.

Sapp summed up his thesis by stating:

People who say, "well, I'm a Christian and I can follow Ayn Rand." Well, by definition you can't, because Ayn Rand taught you can't follow her and follow Christ.

What an amazingly puerile, vacuous and facile statement. To be sure, there are problems with the Objectivist philosophy. Ayn Rand's view of the world relies too heavily on individual integrity to work. There are dark and ugly traits in man that will prevent the absolute capitalism that she envisions. The corrupt and lazy would certainly ruin it for the rest.

Conservatives and Christians who gravitate toward the works of Ayn Rand connect with the descriptions of individualism and small government. Sapp and Hartmann's black and white, unnuanced view that one must either take all of Rand's philosophy or none of it is childish. This manner of thought might also prevent Christian progressives from supporting any governmental social programs since such policies fall within the bounds of Marx's teachings.

One would think that these gentlemen of the left would laud the 'big-tent' inclusivity of Christian conservatives that can find some common ground with an unabashed atheist.

Sapp said that he is hoping to engender discussion with the ad campaign by revealing that the fruits and roots of the Republican budget are rotten and not in keeping with Matthew 25 (if fruits are actions, then roots are motives), and that Republican politicized policies are rotten and based on a totally anti Christ message. Surely he doesn't hope that those who see the ad will then vote Republican after considering the anti Christ nature of Republican policies and the evil motives and trickery of those making that policy. He fully intends to persuade those who may have voted Republican to support the Christ centered, kind policies of the left that are in keeping with Matthew 25.

Another subtext in their argument assumes that the vehicle for Christian charity is the government. They offer no Biblical justification for this. It is just assumed.

What is particularly odd about this is that normally those on the political left are hypersensitive to any commingling of church and state. It doesn't seem to bother either of them that the leap from caring for the poor to having the government be the purveyor of that care clearly violates the cherished notion of separation of church and state. If they embrace the idea of the separation of church and state, they should recommend that Christian charity be done by the local churches. If, however, they desire that the government perform this directive of Jesus, then they should acknowledge that they do in fact want to legislate morality and have the government perform their religious duty on behalf of the church.

Sapp and Hartmann must explain how making laws imposing the religious ideals expressed by Jesus either does not establish a religion, or does not prohibit someone from exercising his religious choice (if, for example, his religion does not mandate that he give charity). One suspects that the argument in favor of government imposed religious belief in this case might sound similar to conservative's maintaining that a national day of prayer is not tantamount to government establishing a religion. However, since a day of prayer does not require input from anyone and the imposition of Christian charity mandates the taking of another's earned income, one might expect a more thoroughgoing and rigorous apologetic by Sapp and Hartmann.

However, they might argue that the concept of charity can exist outside of the religious dogma of Christianity and therefore isn't exclusively a religious teaching but rather a universal ideal. Of course, if this is the case for charity, it is also the case for the ideals that religious conservatives identify with in Ayn Rand's writings. Just as an atheist is not compelled to eschew the economic policies of a devoutly religious liberal, a religious conservative does not need to be bullied into abandoning ideas about limited government because the atheist Ayn Rand also shared those beliefs. And the thoughtful person is able to discriminate and is in no way obligated to accept or embrace every idea promulgated by any author. In other words, they are free to eat the hay and leave the sticks.

The throw the baby out with the bathwater approach suggested by Sapp and Hartmann is so inane that it hardly merits a response. But they present it in such a smooth and confident manner that is passes as sophisticated thought. Presented without critical review, this argument will likely persuade some voters who are not secure in their own world view.

Just as honorable liberals can favor a political economy that seeks equalization of wealth through redistributive policies without embracing the uglier aspects of Communism, so a conservative can favor a political economy that seeks competitive markets with minimal government intrusion without embracing the uglier aspects of Objectivism.


Chuck Colson video on Atlas Shrugged

BreakPoint Commentary

American Spectator

It's touching how liberal, religiously pluralistic groups like Faithful America and American Values Network are suddenly very concerned that Christians specifically remain faithful to the Bible and to Jesus. Their respective boards are populated with activists and clergy not themselves known for careful adherence to Christian orthodoxy.

The Atlantic

But calling Ayn Rand "brilliant," as Rush Limbaugh is quoted doing, or labeling yourself "a fan" of her work, like Rand Paul, doesn't mean that you embrace every tenet of her philosophy, never mind her every statement about Jesus Christ or the Christian religion.

Eric Sapp in The Huffington Post

It uncovers the heartless GOP and Tea Party wolves who've been parading around in sheep's clothing among the Christian flock, leading them astray.