The Ultimate Minority

I’ve been studying the Austrian School of Economics for some time now, and I am proud to have finally found a home.

In the business and management world, Dr. Deming taught that without proper theory, one has no sound basis for action.  Without theory, one finds themselves endlessly reacting to events that occur around them, and their attempts to “fix” the problem only wind up making matters worse by tampering with the system.  Theory provides a lens with which one may view events, place them in context, and make rational decisions.

The Austrian School is my lens for the study of economics; the study of how individuals, acting in their own self-interest, interact with others in society and improve the standard of living of mankind through mutually beneficent exchange.  The Austrian School is proper theory because it recognizes order in society as an emergent property, the result of billions and billions of individual choices and actions taking place in the free market.

Mainstream economics, as represented by the Keynesian school, denies the emergent property of order, and instead prescribes central control as the means by which order is imposed on society.  Keynesianism is Statism.  (For more, please see my post The Two Schools of Economics.)

So after a long period of independent study, I was pleased to receive feedback in the form of a 100% Austrian score on the Austrian Economics Quiz at Mises.org.  Personally, I didn’t find the quiz all that difficult, and I know I still have a lot to learn about the Austrian School, but it was nice to verify that I’m on the right track.  In the coming years, I hope to not only be a student of the Austrian School, but a contributor to the theory.  A solid foundation in Dr. Deming’s System of Profound Knowledge provides insight that I believe can add value to the Austrian School.  I still have the itch to go back to school and earn my PhD, and have decided that if I am to do so, the study will be Economics.  I’d have to find the right fit, though, as I have no interest in earning a PhD in the Keynesian school that dominates academia.

I encourage you to take the Austrian Economics quiz – it is 25 questions in multiple choice format, and even if you choose the “Keynesian” answer, it will present the Austrian answer to each question for you to ponder.  Let me know how you did in the comments!

This is a statement that I wish those who advocate the free market used more often:  I Don’t Know the Answer.

Those who argue for the State often challenge those of us who are against the State to pose our alternative.  Pick your scenario, it doesn’t matter:  How would we provide “xxx” without the State?  Too often, those who will defend the free market feel compelled to provide a solution.

The right answer is “I don’t know.”

It’s easy for statists to say “Ah hah!  Without a better solution, you’re lost!”

To that I say “BUNK.”

If I professed to know “the answer” I would either be:

A)  The one who will provide a market-based solution, subject to the discrimination of everyone…and if successful; hugely profitable and documented as one of the great business visionaries of all time

-or-

B) On the same plane as a government official claiming that his solution is the “right” solution for all members of society, and imposing it on all others as “law.”

If I claim to be none of the above, I only posit that the free market will come up with millions of solutions, and that the best solutions will rise to the top – and that as better and better solutions are found, they’ll supplant the earlier solutions at the top.

This is because that is what the free market is all about:  Ideas.

If you have a better idea of how things should work, introduce your idea to others.  If they think it’s a good idea, they’ll tell you with their choices, by allocating their money to your idea.  If it’s not good enough, it will fail because people won’t support it with their hard-earned money.

Yes, it is that simple.  It is a deterministic ideal to believe that there is a “one best solution” to all issues confronting mankind.  The best solution is to let them be presented with multiple choices, and to let the best one emerge in the market of free choice.

Pick any example.  Post it in your comments.  I’ll respond with a few potential ideas, but not the “right one.”

In order to have a clear understanding of rights, one must first understand the concept of property.  Questions of “right” can be easily sorted out when approached from the perspective of property.

Most envision a piece of land when thinking about property, but this is too narrow a definition.  Property begins with self ownership.  As an individual, you have full ownership of your own body.  You have the absolute right to determine what goes in to your body.  No one has the right to infringe on your property, in this case, to assault your body.  Your labor is your property.  What you produce with your hands, or with your mind, is your property.  When you go to work, you sell your labor to your employer, who in turn sells you money in exchange for your labor.  Everything you acquire through lawful exchange is your property, and you have the absolute right to determine the disposition of your property, whether you choose to sell it, give it away, or dispose of it.

Property ownership is transferred through mutually agreed upon exchange.  If I own a bicycle, I may agree to sell it to you or I may give it to you.  Once I have decided to do so, I have transferred the property and therefore the property rights to you.

Understanding rights from the perspective of property helps us clear the air of confusion when collectivists put forth their “but” arguments against individual rights.  For example, many have heard the argument that you have a right to free speech, “but” it has to be limited because it shouldn’t be a “right” to run into a theatre and yell “FIRE!”

Approached from the perspective of property rights, it is easy to see why yelling “FIRE” in a crowded theatre isn’t a “right” in the first place.  First, the theatre owner (as the property owner) has the absolute right to establish rules of conduct on his property.  By purchasing a ticket, you consent to his rules.  The act of yelling “FIRE” disrupts his business operations on his property, endangers his customer relationships and future revenues, and may subject him to liability if people are harmed.  The property rights of the individuals attending the show are similarly violated, as they exchanged their money for 110 minutes of entertainment, and cutting the show short deprives them of the property they rightfully purchased.

Speaking of individual rights, it should be noted that only individuals have rights.  There is no such thing as a “group’s” right.  Groups are abstract concepts, only individuals exist.  Every individual in a group has rights inherent in his humanity, but no additional rights are acquired by membership in a group.  The rights of a group are simply the rights of its individual members.

Election day, 2008:

I don’t think I’ve ever voted Democrat or Republican in a general election – maybe sometime in the past, I’m not sure, but for the most part I’ve always voted third party.

This time around, I made a different choice: I chose not to vote.

I chose not to vote for the lesser of two evils, because I would still be voting for evil.  I chose not to vote third party, because I do not believe this government can be “reformed” if we can just get the “right people” in office.  I chose not to vote to express something much more profound: I have withdrawn support for this government, and I will not legitimize it by participating in its grand show of validation.

History has shown that while government has had minor setbacks in its growth from time to time, the long term trend is that it will continue to grow.  Growth of government and individual Liberty are inversely proportional.  Each administration has left us less free than we were upon its taking of office.

The constitution has failed in Thomas Jefferson’s vision that it would bind the government down with chains.  This government resembles the constitution only in form, in that it has three branches and holds elections every few years.  The constitution is, at best, nothing more than a speed bump to be occasionally overcome by an ambitious ruling class.  When the constitution was the supreme law of the land, it could be said that we lived under Rule of Law.  Due to its failure, we live under rule of men.

This government has ruled the world money supply for decades with its worthless fiat money, and – as is always the case with the unlimited power to create money out of thin air – it has destroyed the value thereof, devastating the productive base of the nation and the middle class that it built.  The future value of all fiat monies, at some point in time, is zero.  The three decades since the final breakdown of the Bretton Woods arrangement have brought about deterioration at an exponential rate, manifest in the recent trillion dollar bailout and the multi-trillions yet to come.

This government cannot be reformed.  It draws evil to its ranks, and quickly converts the well-intentioned into evil with its black hole-like power center.  It is, after all, the most powerful government in the history of the world, running the most expansive empire in the history of the world.  As children, we were taught two things about empires:  They’re evil, and they are always doomed to failure.  This empire’s day is coming, whether it be five years or fifty years from now, I do not know.  But it will fail.  The only question is whether it will go out with a bang or with a poof.  I do not claim to know the outcome.

I do know that I have taken the first and most important step that all of us must take if this government is going to go out with a poof. We must reject its claim to rule over us.  We must declare our individual sovereignty.  We must strip it of its legitimacy, and then dismantle it – lest we (or succeeding generations) will be forced to shed blood in order to reclaim our natural rights to life, liberty, and property.

I, for one, do not wish to pass that burden to future generations.

And their elected “representatives” have ignored them, and have done what they planned to do all along.

Today, the congress passed the massive bailout bill, the biggest ripoff in American history next to its causal predecessor, the Federal Reserve Act of 1913.  Last week, a reluctant House of Representatives voted down the bailout bill after a tsunami of calls, letters, and emails in opposition.  There was a brief ray of hope, in that the roaches had been sent scurrying out of fear for losing their jobs.  Paul Ryan (R-Wis) said:  “We’re all worried about losing our jobs…Most of us say, ‘I want this thing to pass, but I want you to vote for it – not me.'”

One may have been encouraged by the failure of the first bailout bill.  One may have believed that this is, in fact, representative government because, ultimately, the people can “throw the rascals out” if they do not do their bidding.  One may counsel one’s self that if enough people can be motivated to take action, the system works – the threat of removal from office would enforce the will of the people.

One would have been disappointed.

The Senate took the responsibility to correct the failure of the House of Representatives, repackaging the bailout in a swift and unconstitutional manner, originating a bill of revenue in the Senate (against the requirements in Article 1, Section 7:  All bills for raising Revenue shall originate in the House of Representatives.)  They passed their bill 74-25 and handed it down to the House.  Emboldened by Senate action, pacified with more welfare and promises, House passage of the bill was a formality.

The first version of the bailout bill was three pages in length.  The second version was over 400 pages.  The bill went from $700 billion to $810 billion.  Another $110 billion in pork was added to win over the support of those congressmen who could be persuaded with goodies for their district, or more accurately, welfare and subsidies for those who stuff their campaign coffers.  To this end, we paid for:

• Sales tax exemption for certain wooden arrows designed for use by children:  $2 million over the next 10 years
• Tax breaks for a motor sports racing facility:  $100 million
• Tax breaks for rum importers:  $192 million.
• Corporate welfare for research and development:  $19 billion

The list goes on and on.  Taxpayers for Common Sense gives an overview here.

This act of government intervention was always about one thing and one thing only:  Preservation of government power and corporatism.  You did not factor in to the decision.  Your outpouring of objection was a minor annoyance to be overcome.

In the end, it matters not what you think.  The government will go ahead and do what it wishes, because you are not as important as the State.  These “elected officials” are not representatives – they have assumed the role of the ruling class.  You are not a constituent, you are a subject to their rule.

It is time to face the cold reality:  You are not represented by this government.  The sooner you free yourself of this myth, the sooner you can begin to reclaim your liberty.  The constitution failed long ago to bind government down with chains, as Thomas Jefferson suggested.  There is no chance for reform, we are well beyond that point.  Our only path to restore liberty is to tear this government down, learn from our mistakes, and start anew.

Follow-up:  The People Have Spoken II – The Futility of Politics