Monthly Archives: April 2009

Good Ol’ Master Nolan

I was on Facebook today, and I noticed one of my friends had used the Nolan Political Chart in the context of identifying political orientation. I’ve seen it loads of times before, but I never really thought about it much until now.

I find it very disturbing that David Nolan chose to gauge political standing using a diagram that separates economic and personal freedom. This is evidence of a society that does not fully understand the role of government and how personal and economic freedoms are all inalienable rights. A person and their family’s very well being is determined by their economic freedom. To say that a society is personally free when the government controls the means of achieving a desired standard of living is absurd, and a government that does not respect one facet of freedom cannot respect another. Abridging either facet only expands the power of government, and creates dependency in its constituency.

That being said, I also find it disturbing that Nolan associates the “right-wing” with having a lack of personal freedom. Not only are terms like these ambiguous, but they also show a lack of understanding of conservatism, the political philosophy most commonly associated with “right-wing”, and the United States Constitution. I outline conservatism in a previous blog entry of mine, show how conservatives have been labeled by common arguments and misconceptions, and how conservatism has been and always will be the philosophy of individual rights in an ordered civil society.

Lastly, getting back to rights: The only finite human aspect in the universe is time. By nature, humans base how to spend their time living on economic rationalizations. The time a person spends (or doesn’t spend) on economic productivity is directly related to the personal well being of them self and their family. Be abridging or delegitimizing the value a person’s economic productivity (labor or lack thereof) through government activity (taxes, welfare, etc.), you are delegitimizing the time they spend living, affecting all aspects of life, including non-economic, personal ones. Likewise, the abridgment of certain personal freedoms also decreases opportunity for economic endeavors.

Normally, I can somewhat sympathize with the libertarian viewpoint for many issues on a case-by-case basis. However, I am consistently annoyed with the general libertarian mindset that disregards the importance of constitutional government and ordered liberty in the civil society. When limited and controlled, government does provide protection for the citizens as well as other minimal, efficient services.

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Sub-Priming It Up

This may seem like old news by now, but I am constantly suprised by how many people are unaware of many factors in this discussion of the “sub-prime loan banking crisis.”

Either you are of the mindset that the government created the sub-prime mortgage crisis, that excessive regulation of the banks starting with the Community Reinvestment Act signed by Jimmy Carter and perpetuating with the folly of the Clinton Administration and Congress through Fanny Mae and Freddie Mac in the early nineties led to the collapse of the banking industry through a massive wave of defaulted mortgages (here is a piece on IBD that summarizes this view very well), or you are of the mindset that greedy bank executives created it, or perhaps even some combination of the two. Whatever the cause, the practice of issuing risky loans to unqualified home buyers has proven to be unproductive and foolhardy. Given this knowledge, the debate over whether or not to use federal tax dollars to bail these banks out is mute, as you will only be funding the current business practices.

To solve this problem, we again see two diverging mindsets: One, that government regulation, having caused the problem in the first place, should be drastically reduced, giving the free market room to correct itself. A second, that new, heavy government regulation of the banks should be employed to protect unqualified home buyers, and by setting business conditions for receiving federal bailout money, defeat the schemes of evil bank executives, seems to have been commonly vocalized in Washington for the past few months.

This second mindset should be a warning sign to all. It is the chant of a leftist demagogue, and holds no basis in our society, nor any place in public policy. First of all, why on Earth should the money of federal taxpayers be used to buy up all the “toxic assets” the banks currently hold? They’re toxic for a reason, and to shift the burden created by the unwise actions of unqualified home buyers to the entire responsible and productive sector of the economy is idiotic. To the holder of this mindset, I must ask “Where in the Constitution is the power to run private entities delegated to any branch of the United States Government?” It is obvious that because the powers of Congress are even enumerated in Article 1 Section 8 that Congress was not meant to have unlimited power. This is again exemplified by Amendment 10 in the Bill of Rights, reserving unenumerated powers to the States and the people. If you dismiss the boundaries specified by the Constitution, where then do you draw the line of governmental prerogative? Without the Constitution, there is no rule of law. There is only the free acquisition of power by governing bodies, and no remaining safeguards against tyranny.

Keynesonomics

As I see it, the concept of using government spending to increase demand in the aggregate of markets takes for granted two assumptions that, though they should not be, are often overlooked:

1. The government has the money to spend in the first place. Since the federal government derives all power and funds from the people, Keynesian spending takes away from the very people (or at least the many responsible ones) we are trying to help. And to say borrowing from other nations is a viable solution to this dilemma is the other side of the same coin since the burden of repaying those debts will be placed on the American taxpayer anyway.

2. The government can effectively focus their Keynesian idiocy in the right markets as efficiently as private citizens and firms can. This assumption can never be fulfilled in reality, however, because before the government can spend money, it must first be consolidated in the form of revenue and then spent on huge magnitudes. Doing this contradicts the nature of individual actions conducted in the private sector, as many voluntary private transactions add up to build the economy, instead of spending from the top-down, and hoping some of the money goes where you want it to.