Saturday, April 23, 2011

Too Late to Tinker Around the Edges??

I cannot help but notice a connection to today’s editorial by Mr. Wile and the editorial a few days ago by Mr. Hultberg and his new political party. Without rehashing all of the discussion from the aforementioned editorial, it would seem Mr. Hultberg’s “practical” solutions fall directly in line with the promotion of austerity, and that the solution lies – not in a complete rethinking of the relationship of government and society – but in a better management of government, with ALL of the control systems remaining in place.

As Mr. Wile said quite well, “Rather than question the fundamental alignment between the public and private sector – the basics of regulatory democracy – the IMF treats a country like a business and prescribes cost-cutting, privatization and other methodologies that address the symptoms instead of the cause.”

I will offer a few quotes from today’s editorial:

FT: This must involve cutting spending, reducing entitlements and raising taxes.

Barr: While the solution to that problem surely lies in more responsible policy – lower spending, a less ridiculous tax code….

Wile: But the real message in Barr's article, like the FT's, has to do with IMF-style remedies in my view. The phrase "less ridiculous tax code" seems to bear that out.

Wile: The conversation, as we can see in the above articles, is constricted. The problem is always defined as too much government spending. The solution is to demand more revenue from the citizens' affected and to slash the public services that many have grown to depend on.

Wile: IMF provisions featuring privatization, tax hikes and public sector "austerity" are designed in my view to provoke the very public anger that Western elites are counting on to fuel a conversation about yet MORE centralization and MORE governmental control – of a "transparent" and "disciplined" type.

Wile: The conversation is constantly to be focused on "better" government, not less of it.

And what will be the likely result of such “practical” solutions as offered by Mr. Hultberg and others like the IMF?

Wile: The result is a controlled social implosion that the powers-that-be can capitalize upon to introduce a new system, presumably a more globalized one, complete, perhaps, with a global central bank administering a new currency.

Finally to the point that “practical” solutions are no longer sufficient, and in fact only a distraction from the true problems:

Wile: One doesn't merely need "less" of what is currently offered. What is needed is a discussion featuring the fundamental freedoms that gave Western-style democracies their strength to begin with. The US 's vibrant economy in particular was built without a graduated income tax and without a central bank. There were no centralized regulatory authorities and no over-arching military-industrial complex.

I would only modify one portion of the statement. The US’s vibrant economy in particular was built without an income tax of ANY kind. The current income tax and the current central bank both were born at the same time, the dreadful year of 1913.

Now, I will say, I wrote all of the above in real time: capturing my thoughts as I read the editorial, and before reading the conclusion. Imagine my surprise, when at the end of today’s editorial, I read Mr. Wile’s conclusion, which is exactly the opposite of everything I gathered (and commented above) while reading the editorial:

Wile: While an even more radical downsizing might be preferred, Hultberg's proscriptions are at least a start and go far beyond the IMF-style conversation now being prepared for the US.

Mr. Hultberg supports a flat income tax, when the vibrant economy of the US was built with NO income tax. Mr. Hultberg supports a Federal Reserve, with a mandated policy to inflate 4% per year, when the vibrant economy of the US was built with no such mechanism of evil. Mr. Hultberg offers a dialogue exactly within the framework of those preaching austerity: fiddle around the edges of a failed system, yet not questioning the system itself.

The conclusion of Mr. Wile’s comments today seems counter to all of the analysis in the editorial.


  1. Bionic,
    Just realized who has been doing all the labor theory (Marxist) proselytizing on the DB!

    Ingo, when he's selling his theory of real estate taxation. He's the one who first said the value of gold is due to the labor invested to obtain it.

    However, DB bought it.


  2. Wayne

    Forgive my delay in responding, I have been pretty tied up.

    Yes, I agree regarding Ingo. While he certainly seems to be well read, his interpretation of history and much of his economics are about 180 degrees opposite from my view. So, he and I will likely continue to butt heads....

  3. @Wayne an BM:

    I think that all value is linked to labor, ultimately. That's why I am so pissed about these IPR dismissal by Kinsella.
    BTW, my blog is now okay (I hope; BM's more mortal cousins may have crept in ;-))

  4. Leonardo

    Congrats on the blog, I will poke around from time to time.

    As to all value being linked to labor, I will respectfully disagree. Value always and everywhere is in the eye of the beholder.

  5. Okay, BM. It may be a definition issue. What I am arguing is that added value is coming from labor. E.g., gold in the soil is just as it is, but to make it tradeable it needs to be dug out, melted into a useful shape etc -- in other words labor has to be added.
    Of course you have a point - the value I attach to it defines if I want to trade it and against what other "value" - whether it is is a pile of hundred mile paper money or a certain weight in gold or zillion liter of oil, it doesn't matter.

    Thank you for being around: you are a great libertarian spirit and if anybody would think/act like you the world would be much happier for all of us.

  6. Yes, I think it is definitional. It certainly takes labor to convert natural resources into items useful for man's existence. As to the value another attaches to that labor, the market will sort that out.

    Thank you for the kind comments. I equally enjoy your writing and wish you the best success; by success meaning that you successfully influence those who read your work!

  7. BM, I have the impression you use your blog reactionary, i.e., merely as a convenient way to react on DB and maybe others. For this reason I haven't added a link to this blog site. If, however, you want me to do so, just give me a shout.

    Thank you for the thumbs-up on my writings. Indeed, let's pray that a few start using their brains finally....

  8. For the most part this is true. In fact I started it as a way to get around a problem I had in posting longer comments at DB.

    I do write on other topics here, sometimes a few times a week, and sometimes not for a month. Mostly I do it for me, as I feel it helps me improve my skills at logic, reason, and communication. I also do it as a way to keep track of where I have been in the journey.

    Thank you for the offer to post the link; it is not necessary. I will then feel pressure to have to write regularly. Perhaps that would be good for me, but I would rather not deal with that right now.

    However, if you ever see anything I write here worthwhile, feel free to link to it or whatever. I will do the same with your work.

    Always best regards.