Thoughts on Freedom

The virtues and vices of America take up a disproportionate amount of the political discussion by non-Americans. This is probably because America runs the world, but also perhaps partly because America did embark on a “wacky” experiment with free-markets and limited government. While the last century has seen America embrace more mainstream social-democratic government, they continue to be held up both by supporters and detractors of the free-market as an important example.

There is plenty of reasons for people to complain about America. And unlike some of the pro-Americans, I think it is fair and appropriate to complain about the vices of America because it is effectively the centre of the world and an important example for other countries.

But it’s worth remembering some of the virtues of America. And one virtue in particular is their generosity. According to Giving USA, in 2007 Americans gave $306 billion to charity, which is a 1% increase (inflation adjusted) over 2006. On average, this is about 2.3% of disposable income.

About 75% of this comes from individuals, and about half of that went to religious charities. An increased proportion of the money has been directed to international aid, environmental and human-services groups. Donations to international charities rose the most (an increase of about 13 percent).

Americans (as distinct from the American government) are the most generous givers in the world, with charity taking up 1.7 percent of GDP. Interestingly, Great Britain is second (0.73 percent of GDP).

Free-market advocates make the point that government charity has crowded out private charity. Consequently, it is safe to assume that private charity would increase if there was a smaller government. The benefits of this are significant, because private charity tends to be targetted better, run more efficiently, more innovative, and helps to bring people together and build a sense of community.

I believe that the private charity sector is of vital importance to building a better world. I think the nature of the free-market is that it creates sufficient wealth so that people divert more of their thoughts and resources towards building civil society. And I think that the long-term consequence of this dynamic would be to build a world that might look similar to what many leftists hope for. Unfortunately, I think this sector is being undermined and devalued by a system that concentrates on government hand-outs.

Maintaining a vibrant private civil society is vital for a free world. And I think Americans deserve credit for the role they are playing in keeping that tradition alive.

Some great news from the States via the latest Zogby poll.

UTICA, New York – As the race for President passes the Independence Day holiday and heads toward the dog days of summer, Sen. Barack Obama holds a 44% to 38% lead over Sen. John McCain in the horserace contest, but also leads by a substantial margin in a state-by-state Electoral College tally, a new Zogby Interactive poll shows.

The extensive national poll of of 46,274 likely voters also shows Libertarian candidate and former Congressman Bob Barr wins 6% support, eating into McCain’s needed conservative base of support.

The online survey was conducted from June 11-30, 2008. It carries a margin of error of 0.5 percentage points. After nearly a decade in development, the Zogby Interactive survey on a state level was remarkably accurate in the 2006 midterm elections. In 18 U.S. Senate elections polled two years ago, the Zogby online survey correctly identified the winner of 17 of 18 races. ….

 Pollster John Zogby: “Obama is in the driver’s seat right now, especially where it really counts - in the electoral votes. Bob Barr could really hurt McCain’s chances. McCain can’t afford the level of slippage to Barr we found among conservatives in this polling. While there has been plenty of talk about Obama’s recent emphasis on his centrist positions, he can get away with it during these dog days of the campaign as McCain finds himself still trying to shore up the conservative base. McCain will have to move to the center because right now Obama is clobbering him among independents. But there is the rub for McCain: Bob Barr has some juice among conservatives and is hurting him in several states. ”

Bob Barr receives the support of 7% of voters who identify themselves as conservative or very conservative voters. Barr gets 43% of libertarians and 11% of independents. McCain’s support among conservatives is 74%. On the left, Ralph Nader gets less than 2% nationally.

This indicates the possibility of up to 5-6 million votes, and there is time to improve on that as both Barr and Root are being taken seriously by a fair proportion of the media, a far cry from the norm.

The disappointing part of it is “Barr gets 43% of libertarians” which means the libertarian purity factor is worse than I predicted, although quite a few serious and dedicated Libertarians have swallowed their disappointment and are backing Barr/Root.

Regardless of the conservative origins of both members of the team, they appear to be bringing huge numbers of voters to pull the lever for Libertarian for the first time, after seriously considering LP policies for the first time. This has to be a positive.

As you may know, my parents grew up in Zimbabwe (then Rhodesia). The last of my extended family left Zimbabwe several years ago, and they are in the process of becoming Australians. But obviously we try to stay up to date with the current chaos. Here is a recent story:

Inside Mugabe’s torture camps: beaten, maimed and poisoned with weedkiller
By Daniel Howden in Harare — Tuesday, 1 July 2008

As Robert Mugabe sought recognition from African leaders yesterday, his police have been arresting the ‘dangerous’ opposition agents that Mr Mugabe accuses of fomenting violence in the country. Mrs Chigoro is one of them. She is considered such a threat she is being kept under armed police guard at a Harare hospital.

Seventy years old, her injuries are so horrific she can no longer lie on her back or walk unassisted. She can only huddle in a claw-like shape. The appalling chemical burns that have removed her lips and melted her right cheek come from an industrial weedkiller she was forced to drink. The widow can eat no solids and survives with the aid of a saline drip. Her crime was to survive the death squads that have roamed the rural areas of this bankrupt and terrified country. The police, armed with AK-47s, have been stationed on her ward to stop her from telling her story.

Read more »

By Robert Higgs

Well, the letter was actually addressed to me and my wife. The IRS people are great believers in family values, and my wife and I are what the tax collectors affectionately refer to as joint filers. It’s all pretty warm and fuzzy, in a creepy sort of way.

Anyhow, the letter was not nearly as bad as usual. It informed us that the government, acting under authority of the Economic Stimulus Act of 2008, would soon be sending us $1,200. Usually it’s the other way around, and the agency’s letter invites us to send it more of our money than we have already sent. Well, we understand, of course: when the government identifies someone who deserves to get our money more than we deserve to keep it, simple justice requires that we pass it along to KBR (formerly Kellogg Brown & Root), Lockheed Martin, and other widows or orphans.  Besides, if we kept the money, we’d probably just end up wasting it, whereas the Department of Defense watches every cent with an eagle eye. Ditto for Health and Human Services. We don’t call those people “public servants” for nothing; they really put their hearts into their jobs.

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Marx thought socialism was a good idea, and one part of that good idea was ”from each according to their ability, and to each according to their need”.

Raul Castro (the new leader of Cuba) also thinks socialism is a good idea… but he has a slightly different criteria. According to Castro, Cuba will now follow:

“the socialist principle of distribution, wherein each person receives according to his or her contribution, that is: pay for quantity and quality”

Castro has introduced capitalist “new-socialist” reform in Cuba, to replace the equal-pay system with performance-based salary (with no upper limit). Apparently this is supposed to boost efficiency and productivity. Indeed. Hand that man a cigar.

This is good news for Cubans and another nail in the coffin of soviet-style socialism. If Cuba is really on a reform path towards markets then that leaves only Nth Korea in the dog-house. Perhaps the US can relax their stupid sanctions now.

But what is the deal with the murder of semantics? Cuba is following the trend set by China and Vietnam in introducing market reform and calling it socialism. That is like curing cancer, and calling outcome “new cancer”. The great minds of China, Vietnam & Cuba seem to think that the definition of socialism is “have good intentions” and the definition of capitalism is “have bad intentions”. So as long as they introduce market reforms with good intentions, they are still socialists.

Of course, their understanding of political philosophy is retarded. But who cares. They can call themselves Britney Spears if they really want. What matters is the action — and the action is towards capitalism.

For the jet-setters among you — there are a couple of international libertarian conferences coming up. One in Europe and the other in America.

Conference organiser Mikolaj Barczentewicz asked me to pass on this invitation to the European get-together – which can be found here. The conference will be in Warsaw (Poland) from June 28-29, and has the support of Libertarian International.

The other libertarian get-together is FreedomFest, being held in Las Vegas, Nevada from July 10-12. The ALS did get an invite to participate, but it’s unlikely that we’ll be able to send over a delegation. If you would like to go over and waive the ALS flag, please contact me.

I owe David Leyonhjelm for bringing this to my attention. There appears to be significant change afoot in Libya, and not the usual ‘Oh shit’ change, but real change for the better. This is not only in the economic area, but also to a limited degree socially.

 Since December 2003, when Libya announced that it had agreed to reveal and end its programs to develop weapons of mass destruction and to renounce terrorism, relations with the West have improved to the point where relatively normal relations exist with them. Come to think about it, it seems kind of odd not having Gadhafi making a bloody nuisance of himself.

 Gadhafi will never be acceptable in polite society owing to some of the extremes he went to during his pariah years, but will probably get along with governments just fine. I am willing to give him the benefit of the doubt as far as the reform to his character but his past will always make him thoroughly reprehensible.

 Free market style reforms will do a great deal to improve the economy as it has done in a number of countries in the past. The massive oil revenues of Libya will of course be used by the left as a smokescreen to excuse themselves from having to make any embarrassing admissions. Read more »

The crisis in Burma caused by cyclone Nargis appears to be worsening. Despite reports yesterday that the Burmese junta will allow limited aid provided it is channelled through ASEAN countries, the aid agencies have released reports predicting widespread famine and death. Save the Children believes that ‘thousands of children will starve to death within weeks unless food supplies reach them soon’ and The UN believes that ‘up to 2.5 million could be at risk of death and disease.’

What to do?

The libertarian position has already been made clear by Lew Rockwell and Ron Paul. This week when a Congressional resolution came up for a vote merely offering ‘condolences and sympathy‘ to the people of Burma, Ron Paul was the only member of the entire House of Reps to vote ‘no’. Lew Rockwell is against any form of help for the Burmese believing it to be a good excuse for the US to take over another country.

Norm Geras points to an alternative reason for the ‘do nothing’ school as presented by author David Rieff in the LA Times. He makes the very valid point that aid agencies are in the business of aid and hence always exaggerate the suffering caused by disasters. But he also makes the absurd point that calls for aid from the French and British are tantamount to a renewed colonialism.

But is ‘do nothing’ the correct and only course of action?

The Economist favours air drops but the Guardian says these don’t work. Our very own ex-foreign Minister and now head of the international Crisis Group, Gareth Evans, has no time for pussy-footing around and has suggested that the UN might need to bring aid to Burma ‘non-consensually‘.

More than a few very powerful people (UK Foreign Secretary, David Miliband, and French Foreign Minister Bernard Kouchner) are raising the issue of whether the 1648 Treaty of Westphalia (which guaranteed the right of a sovereign nation to non-interference from other nations) is now null and void and whether the recent UN resolution of a ‘responsibility to protect‘ (or R2P) should be invoked. This resolution, passed in 2005 with little fanfare, forces the UN to act if a sovereign nation is committing crimes against humanity.

The debacle in Iraq has made people forget that sometimes coordinated interventions can lead to productive outcomes - for example Kosovo and Kuwait. But one thing is clear - unlike say, lower taxes, freer trade or less regulation, the issues around foreign aid and intervention are complex and unintended consequences lie in wait around every corner. It is simply not possible to know the right answers.

Perhaps the best solution is the threat but not the act of intervention. Perhaps this is why the junta have finally relented.

If you would like to do something, John Quiggin is raising money at his blog.

Liberty did once exist in the Anglosphere.

A marvelous passage from A.J.P. Taylor’s ‘English History; 1914-1945′.

‘Until August 1914 a sensible law-abiding Englishman could pass through life and hardly notice the existence of the state, beyond the post office and the policeman. He could live where he liked and as he liked. He had no official number or identity card. He could travel abroad or leave his country forever without a passport or any sort of official permission. He could exchange his money for any other currency without restriction or limit. He could buy goods from any country in the world on the same terms as he bought goods at home. For that matter, a foreigner could spend his life in this country without permit and without informing the police.’

‘Unlike the countries of the European continent, the state did not require its citizens to perform military service. An Englishman could enlist, if he chose, in the regular army, the navy or the territorials. He could also ignore, if he chose, the demands of national defence. Substantial householders were occasionally called on for jury service. Otherwise, only those helped the state who wished to do so.’ 

‘The Englishman paid taxes on a modest scale; nearly $400 million in 1913-14, or rather less than 8% of the national income. The state intervened to prevent the citizen from eating adulterated food or contracting certain infectious diseases. It imposed safety rules in factories, and prevented women, and adult males in some industries, from working excessive hours. The state saw to it that children received education up to the age of 13. Since 1 January 1909, it provided a meagre pension for the needy over the age of 70. Since 1911, it helped to insure certain classes of workers against sickness or unemployment.’ 

‘This tendency towards more state action was increasing. Expenditure on the social services had roughly doubled since the Liberals took office in 1905. Still, broadly speaking, the state acted ony to help those who could not help themselves. It left the adult citizen alone.’ 

‘All this changed by the impact of the Great War.’

The newly formed British Libertarian Party now has a manifesto. Their policies are broadly similar to Australia’s own libertarian party, the LDP, with a few differences.  Interesting to note the much more robust defence policies of British libertarianism as compared with the more passive variety that exists in Australia and the US.  Also note that aim to abolish income tax rather than introduce a flat 30% tax favoured by the LDP.

The British electoral system does not favour small parties. Hence there has been much reluctance from British libertarians in the past to set up a new party, believing that they would rather have their prominent supporters in parties that are capable of gaining power.  There is no chance of the BLP ever gaining a single seat.  The other key difference is that there is arguably a much greater need for a classical liberal party in Britain as the state is so much more prevalent in people’s lives than here in Australia (hard to believe, i know) and the Opposition Tories have become much more statist than their Thatcherite predecessors.   Government spending as a proportion of GDP is around 43% in the UK versus 23% in Australia (not counting the UK’s massive off-balance sheet liabilities such as pensions and PFI) and the economy is sagging under eleven years of regulation and state interference.

Their main policies are;

i) The abolition of personal income tax

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From Expatia. “Anti-govt-intervention group to be launched”

I know that some of you will disagree with me here but I believe that something that is a social problem, (in a lot of cases this simply means that some of us don’t like it) can with the intervention of the dead hand of the state become a social disaster.

Some interesting figures on the various state responses to gun crime come up in the San Francisco Coalition Against Prohibition campaign against Proposition H (handgun control) as follows.

Washington, D.C. has a handgun ban, and is arguably the murder capitol of the USA. Murder is higher now than before the ban. England banned firearms, and crime increased (up to 28% for street robberies; rape and murder have both increased). Read more »

An anonymous Norweigen, using the alias John Smith, recently asked if the ALS could publicise his request for help. Following the controversy about Danish caricatures of the Islamic prophet Mohammad, “John Smith” wants to up the ante by introducing more caracatures. His request is below:

1001 caricatures of Mohammad

What should the answer of the freedom loving peoples of the west be ageist the fascist forces in Islam who threatens with violence to stop critical opinions and caricatures of Islam?

If you are one of many who share my beliefs that we have to fight this totalitarian ideology, you now have the possibility to participate. I am writing a book called “1001 caricatures of Mohammad as a defense, for the right to ask the critical questions and make caricatures”. As you understand from the books title, I need contributions in the form of 1001 caricature drawings of Mohammad.

I am writing this book under a fictional name because of the dangers combined with expression critical views of Islam. Any contribution will be protected in the same manner as my self.

Make history; defend the freedom too many take for granted. With a pen you can stand up and fight for the right to be free in the battle of liberty for all the peoples of the world.  Send your contribution to: 1001.muhammed@gmail.com.

I’m not so sure about this. I agree with freedom of speech, as one example of the general freedom to do what you like with what you own as long as it’s peaceful and voluntary. I don’t think the government should stop John Smith from publishing his book.

However, I’m not sure about the morality of publishing a book that intends to offend, simply to make the point that it should be legal to offend.

Likewise, I don’t think the government should prevent art works like “piss christ” (a picture of Jesus covered in piss)… but I’m not sure that it is in good taste. According to my moral radar, it’s inappropriate to offend people, unless you’re making another necessary point. The only point of piss christ and mohammad caracatures is “ha ha… I am allowed to offend you”. It would be like calling somebody an asshole simply to prove that you’re allowed to call them an asshole. Legal? Sure. Friendly? No.

On the other hand, there have been death threats and absurd over-reactions by some people regarding the Mohammad caracatures. It would be a shame if this coercion was successful. Perhaps it is appropriate for somebody to repeat the caracature episode simply to show that threats and intimidation will not be tolerated or respected in a free (well… relatively free) society. This is unfair to peaceful Muslims, but perhaps it is necessary.

I am not publishing John Smith’s request because I want people to participate. Personally, I won’t. Instead, I want to use this debate to spark a debate about when it is morally appropriate to be offensive?

The US State Department has decided it knows how to deal with Iran better than India does. But India begs to differ:

USING uncharacteristically strong language, India last night told the US to butt out and mind its own business after Washington attempted to tell the country how to deal with Iranian President Mahmoud Ahmadinejad when he visits New Delhi next week.

Ahead of the visit, the first to India by the Iranian leader, a State Department official offered gratuitous advice to India on how to handle him, suggesting that it should take a tough line in pressuring Tehran on the nuclear issue to “become a more responsible actor on the world stage”.

We need more countries like India to speak out against America’s current isolationist policy (sanctions, threats of military confrontation) towards Iran. I think it would reduce the chances of the Iraq war spreading into Iran.

OK, I know I will never get many of you on the John McCain bandwagon, (I have been quietly supporting him for a while without telling you), and you all seem to think Ron Paul is the answer to the prayers of all of Libertaria.

 Here is a guy for you who will do far more for the libertarian movement than any of the other LP candidates and Paul combined, with the exception of Wayne Root, who although he is the best of them will probably now find the going tough.

 The LP now finds itself in the unusual position of having two candidates with actual federal government experience, Bob Barr as a former congressman, and former Democrat Senator Mike Gravel.

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A few people have noted the progression from moderate libertarian Milton Friedman to his anarcho-capitalist son David Friedman and have questioned where the next generation could go from there. The answer is seasteading.

A while ago I stumbled across the online world of Patri Friedman and swapped a few e-mails. Interesting chap. One of his big ideas was to create self-sustainable floating “countries” and he called this idea seasteading. It’s not a new idea, but Patri seems to have taken it further in terms of design and logistics… and now that he has $500,000 worth of sponsorship, the Seasteading Institute is up and running.

This morning I got an e-mail from Patri to tell me about the Institute. Their initial press release is below:

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I have just finished reading John Lee’s book, Will China Fail?, released by the Centre for Independent Studies. Lee has performed a valuable service by documenting what moving towards freer markets has achieved – stunning growth rates and lifting hundreds of millions out of poverty. He also notes the fundamental contradictions that must eventually be resolved by the Chinese Communist Party.

These contradictions arise from the tension between free markets and political authoritarianism. Free markets cannot exist in a vacuum. Markets require the defence of private property, enforcement of contracts and government organs operating under the rule of law. Though no longer a totalitarian state, China is still very authoritarian. It does not have an independent legal system, and thus cannot provide businesses the certainty they need to prosper.

Read more »

During the forced collectivisation of China’s “Great Leap Forward”, food production dropped sharply. But Communist Party officials inflated food statistics so they could argue there was no food shortage. The authorities exported grain while ordinary Chinese starved. ”See, communism does work,” Mao Zedong would proclaim to the world.  

Unfortunately, communist rationing of food had some side-effects:

Deaths were kept secret as long as possible. What food there was was distributed by the collective kitchen and generally one family member would be sent to collect the rations on behalf of the whole household. As long as the death of a family member was kept secret, the rest of the household could benefit from an extra ration. So the corpse would be kept in the hut. In Guangshan county, one woman with three children was caught after she had hidden the corpse of one of them behind the door and then finally, in desperation, had begun to eat it.

From this, we can derive a basic test that we should apply to all ideologies. It goes like this. Is the ideology likely to lead to mothers eating their own children? If so, the ideology is flawed. Pretty simple, really.

In the case of libertarianism, to the best of my knowledge, I believe the answer is “no”.

Well done, Pommy, you’ve sent the blog stats into overdrive… I even took a screenshot of the WordPress home page for keepsies. Classic stuff… not sure how it happened, but our most popular post yet. BTW, you can watch (and download) Fitna here.

UPDATE: I should probably also mention that I’ve blogged this over at Catallaxy, in part because I have Dutch relatives and find the whole issue interesting from their perspective.

From Bloomberg:-

Bernanke and the four Fed governors voted yesterday to become creditors to Bear Stearns Cos., a securities firm that isn’t a bank, by invoking a law that hasn’t been used since the 1960s. Three days earlier, the Fed said it would swap Treasury notes on its balance sheet for privately issued mortgage-backed securities held by Wall Street firms.

“It’s a re-drawing of the relationship of the Federal Reserve with the rest of the financial system,” said Vincent Reinhart, former director of the Division of Monetary Affairs at the Board. Risks of so-called moral hazard, where firms will now come to count on bailouts by a federal agency, “are considerable,” he said.

I don’t think taxpayers should bailout failing businesses and I don’t make an exception for banks. However if a central bank is going to offer finance to bail out a business such as this then I think they should do so only on the condition that they receive an equity stake (which they should offload on the market at some later point) and that the board sack the CEO. This would at least mitigate some of the moral hazard.

John Quiggin has spawned a good discussion about the poor performance of financial credit rating agencies at his website.

This produces some absurd results. For example, Ambac, a mortgage insurer whose shares have lost 92 per cent of their value in the past year, is rated at AA by Fitch. By contrast, Greece, a Eurozone member country, is rated A. Does anyone seriously think the probability of default by Greece is greater than that for Ambac? And Fitch is conservative. Moodys and S&P still have Ambac rated as AAA suggesting, to anyone foolish enough to believe them, that the probability of default is negligible.

In the comments Mugwump offers this interesting insight:-

The solution is to get rid of the effective government-granted monopoly on ratings providers. The ratings used for banks, money markets and state pension funds must be assigned by Nationally Recognized Statistical Rating Organizations, or NRSROs.

In order to achieve the NRSRO designation, and organization must be “nationally recognized as an issuer of credible and reliable ratings by the predominant users of securities ratings.”

So you effectively cannot become an NRSRO unless you’re already an NRSRO. Catch 22.

Check it out.