no third solution

Blogging about liberty, anarchy, economics and politics

Category Archives: Blog Reactions

RE: The Economics of Invasion

November 28th, 2008

We all know, or ought to know, the truth about the State’s origins. To a one, they are built on a foundation of violence, and they maintain their statehood through the systematic implementation of violence and oppression.

In Some economics of invasion and the State, constant‘s most interesting idea is that since overthrowing a State appears to be a public good, then according to conventional wisdom, it will be undersupplied. In short order, he proceeds to lay out a pretty elementary case for the common defense as public good.

This case, however, is always argued upon a single iteration of the game. Surely, upon learning that one’s neighbor had been violently deposed by an invading bandit, the remaining freemen should begin to see the true costs of their failure to voluntarily provide for a common defense. Historically speaking, this might’ve been difficult in practice, but I’m not convinced that this is any longer the case.

One very private good is the ability to hide one’s assets, or perhaps more importantly, the ability to hide one’s production from the State. If the wealth you create was never part of the white market in the first place, it becomes almost impossible to track or quantify. The State can only steal what it can see, what it knows to exist.

The concept behind the Agorist movement, is to take Constant’s second course: free yourself, as much as is humanly possible, from the State’s constraints. Work with others who share these goals and ideals, to assist them in freeing themselves. It certainly has a Galt-ian appeal to it: by working together and outside the system with people you trust, to better yourselves, the oppressive state should collapse under its own weight.

Comments on Comments #30

November 26th, 2008

Here are some responses to your comments, prior to the Thanksgiving Holiday. Blogging may be light during the next few days as I try to catch up on reading, then again, blogging may be prolific. Who knows.

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Mike Gogulski 1955Design left a comment on Metablogging, in regards to my inquiry about the Twitter badge in the sidebar.

Mike and 1955Design report that they see the Twitter badge correctly.  Must be something local to my machine, although it was visible at first.

If readers are seeing it (and I’m not) then I’m not worried about it.

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I’ve had a few technology-related issues in recent months.  This morning, this website was haxxed.  It may be a WP security issue, but appears like it might be a server hack.  In any event, some of my readers have been kind enough to offer advice for dealing with these problems.  Although I haven’t needed their help, it’s great to know that people who are essentially strangers are willing to help me out. That’s voluntaryism.

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Mike Gogulski points out that Taxation is still theft no matter how many logical fallacies you employ was getting some attention on reddit|Anarchism. I’m glad there’s discussion, but a lot of the comments were obvious trolling. I don’t follow reddit, digg, etc., although reddit and stumbleupon have been driving some traffic to my site lately.

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On the metablogging note, Billy Beck @ Two–four.net recently linked here. I got a lot of traffic from that hit. I’m very happy people are noticing and reading my blog. If you don’t read two–four regularly, I suggest that you do.

Traffic for November looks to exceed 4,000 absolute unique visitors according to AWSTATs. I’m getting anywhere between 50-150 unique visitors each day, and approximately 500 pageviews, daily.

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Brad left a comment on No Nation Ever Taxed Itself Into Prosperity, Either:

What are you and RG trying to solve? It sounds like a battle of “I have read more books than you so I’m more qualified.” RG sounds like a politician.

I think your argument of taxation brings no good is simple enough. There just needs to be a better way to collect taxes instead of just taking it through income taxes or raising taxes on certain products (like yachts). I like a flat federal retail tax. This way the government can only get as big as the market will let it.

LOL @ the first part of the comment. I sensed it was kind of going that way, and asked RG to post his commentary at his own blog (he doesn’t have one) or to feel free to correspond with me via e-mail. He has yet to do so. He left a number of comments that I’m trying to put together into a coherent post, rather than piecemeal comments/responses, they’re not going unnoticed or unchallenged.

The second part of Brad’s comment is WRONG.

I oppose a flat tax for the same reason I oppose any tax. Taxation is theft, and it even though a flat tax is somewhat more transparent (allegedly) it still amounts to ransom for permission to live. In a free society, that is intolerable.

Brad is a budding libertarian, so there is hope for him, yet. The problem is buried as a hidden premise to “There just needs to be a better way to collect taxes”, which is, “Government is the only entity capable of providing certain things, from which it follows that taxes are necessary for the provision thereof.” I could probably write a book on that topic.

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I’ll respond to one of RG’s comments

Also — as much as you have studied economics, I find it hard to believe that you support the market-distorting mortgage tax deduction. Granted, you believe nobody should ever pay taxes and we should live in caves. But given current circumstances, surely you can see that the tax deduction is nothing more than a transfer of wealth from renters and homeowners (e.g. no mortgage) to people who are somewhere on the 30-year journey to homeownership.

Taking off my anarchist hat, for a moment, from a policy perspective, it seems far more reasonable that a deduction be based not solely on mortgage interest paid, but rather on the total monthly housing expense. In this manner, no matter where you are on the 30-year amortization continuum, or even if you rent a home, you’d be eligible for a deduction based on the monthly payment. This proposal might also base the deduction on the property value instead of monthly payment, in order to reduce/eliminate the incentive to remain indebted.

Insofar as the current incentive serves as a transfer, it falls primarily on the renters, since homeowners at one point benefited from the deduction (or, if they paid cash, had the opportunity to benefit from it). I don’t support it as a general principle, I’m just trying to point out that repealing that deduction would be the single largest increase in effective tax rates, probably in the history of the world.

But wait: If reducing tax burdens for some people “distorts” the market (I agree that it does), is it not also true, that raising tax burdens for some people is also distortionary?

Yes, that must also be true. That’s one of the points I’m trying to make in that series of posts.

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Enjoy the holiday weekend.

“The Dollar Standard Flooded the World With Funny Money”

November 25th, 2008

I’d argue that the world was already flooded with “funny money” by Nixon’s unilateral repudiation of the Bretton Woods agreement in 1971 (more on that, below) but even still, when the Financial Times is pimping a return to gold-backed money, what’s next, flying pigs?

When Richard Nixon destroyed the Bretton Woods International Monetary System in 1971 by closing the “gold window” at the Treasury, he severed the last link between dollars and gold. What followed was a spiralling proliferation of increasingly spurious credit instruments denominated in a debased currency.

I’m not sure the tie is completely “severed”, for instance, as long as the Government continues to run that printing press, the price of gold (in terms of dollars) should continue to rise.

It’s also important to remember that the monetary system installed under Bretton Woods agreement was already a severely debased version of a “gold standard”.

Most central banks had suspended convertibility during the first world war. The German hyperinflation of the interwar period was at least in part fueled by the crushing reparations due, and the onset of the second world war was more-or-less accurately forecast by J.M. Keynes in The Economic Consequences of the Peace.

The United States had begun to sever the de jure tie with gold as early as (if not earlier than) in 1913, but the most pernicious event occurred on April 5, 1933 when Franklin Delano Roosevelt ordered the expropriation of all privately owned gold money.

What followed was an explicit debasement of the dollar by at least 69%, raising the official price of gold from $20 to $35 per ounce. After Bretton Woods, Special Drawing Rights were required to convert currency into gold, and these SDRs generally reserved for international traders and government entities. As the dollar became the de facto reserve currency of the world, the United States found itself in the fortunate position of being able to export most of its inflation to the rest of the world.

Even Alan Greenspan once argued that “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation.” So, if you want to talk inflation, (in terms of rising prices which reflect an artificially augmented money supply) just look at the chart to the left, showing the estimated Consumer Price Index from 1800 to 2007.  The advent of the Federal Reserve in 1913 is barely a blip on the radar when compared to 1971, but the former paved the way for the latter.

It’s not about some bizarre fetish for a “barbarous relic”, really, it’s not. It’s about plain-and-simple theft. It’s about rights. It’s about the wholesale expropriation of private property, by one of the greatest Moral Defectives ever to preside over the country.

no third solution

Blogging about liberty, anarchy, economics and politics