Thursday, April 30, 2009

Collectivism In Medicine

Health Care is Ailing, from the Star-Ledger Reader's Forum

Jason Fodeman rhetorically asks: "Is our health system really bad off?" in "Haste makes waste when fixing health care" (April 23). In a word, "yes."

According to a recent Commonwealth Fund Commission report, U.S. health care is the most expensive in the world, but does not meet critical benchmarks for quality, access, and other major performance measures. While America spends twice as much per capita on health care, it ranks lower than most other industrialized nations on numerous indicators of overall care; the U.S. score averaged 65 out of 100 over 37 categories, and fell to last for "preventing deaths through use of timely and effective medical care."

Can we afford covering the 47 million uninsured and the 50 million underinsured nationwide? Yes, we can. Currently, insurance companies have an overhead of approximately 30 percent, which is spent on marketing, administration, shareholders dividends and exorbitant CEO salaries. Medicare's overhead is approximately 3 percent. We could save about $350 billion annually, enough to cover the 47 million uninsured and the 50 million underinsured. Both the Congressional Budget Office and the General Accounting Office say the U.S. could insure everyone for the money we're paying now to insure seniors only.

-- Larry Siegel, Plainsboro

My Commentary:

Posted by Zemack on 04/30/09 at 7:39PM
Larry Siegal underscores the fundamental philosophical/moral conflict at the root of the healthcare debate...collectivism verses individualism. He asks:

Can we afford covering the 47 million uninsured and the 50 million underinsured nationwide?

Implicit in that question is the assumption that the wealth and earnings of a nation do not belong to those who produced it, but to the collective, as represented by the state. That primitive view holds that individual human beings have no value except as sacrificial fodder to the whims of the tribe. The representative of the tribe is whoever claims to speak for it, which in this case is the democratic majority as manifested in the government. Mr. Siegel simply assumes that "we" may dispose of the earnings and wealth (i.e., the lives) of whomever "we" please, for the unearned benefit of the "uninsured" or "underinsured" (whatever that means). This is the altruistic premise that individual self-sacrifice for the sake of others is the ideal, which is the moral root of all forms of tyranny, oppression, and predatory government.

America was founded upon the opposite premise...that every individual is a morally independent entity capable of charting the course of his own life by his own mind and effort, and in voluntary, uncoerced, rights-respecting association with others. This is the egoistic premise that each person is an end in himself, not the means to the ends of "humanitarians" wielding the legalized physical force of government, nor as a slave to the needs of other people. America's founding premises lead to a society based upon the inalienable rights to life, liberty, property, and the pursuit of happiness held equally, at all times, and protected by a government limited to that purpose.

Mr. Siegel's premise leads to socialized medicine. America's premise leads to a free market in healthcare.

Leaving aside the issue of statistics...which can be skewed any which way and which tell you nothing about the actual quality of American healthcare...and Medicare's alleged low administrative expenses...which is a myth ...I do sympathize with Mr. Siegel that our system has serious problems. Unfortunately, Mr. Siegel, like so many other advocates of medical tyranny, fails or refuses to consider how we got here. But cause and effect is where we must begin.

The fact is, the problems in American healthcare have grown in lock step with the growth of government intervention. The solution we are racing towards is to reward the culprit with full totalitarian control. The real solution is one that is not even being discussed in the political arena...a turn towards capitalism and free markets.

The only just and moral course to take on healthcare reform is to rid healthcare of government interference. America currently spends some $7500 per capita per year ($30,000 per family of four and rising) on healthcare. Almost that entire amount represents third parties spending other people's money. This is a fundamental part of the problem. That money comes from all of us in a myriad of ways, yet leaves us with little control over how it is spent. Leave that money in the hands of the people that earned it through some vehicle like HSAs, end government insurance mandates and the third-party-payer system, phase out existing "public" plans like Medicare, Medicaid, and SCHIP, and let people take personal responsibility for their own healthcare.

Advocates of socialized medicine (by whatever name you want to ascribe to it) like to take the moral high road, claiming compassionate concern for some downtrodden group. But they never see actual human beings, whom they are free to help through direct, voluntary charity. They give no consideration whatsoever to their fellow men as what they actually are...individual human beings with their own unique values and circumstances. Anyone who would trample the rights of others to act upon their own judgement with regard to their own healthcare deserves not a moral sanction but moral condemnation. Show me someone who would force others to pay for his "compassion" by depriving them of their earnings and their freedom, and I'll show you a phony.

The choice we face is not between a government-run healthcare dictatorship and the status quo. The choice we face is between being held hostage to government central planners, or liberating each of us...consumers, providers, patients, and insurers take control of our own healthcare in a truly free market.

Tuesday, April 28, 2009

The "Public Health Insurance" Option

From the Reader Forum of the New Jersey Star-Ledger.

Oppose insurance lobbyists

During the election, President Obama promised to give everyone the choice of private insurance or a public health insurance plan like Medicare with lower premiums and better benefits.

Obama's public health insurance option could save us up to 30 percent on our insurance premiums by being more efficient and driving down prices across the board, according to the Commonwealth Fund report.

The insurance lobbyists are fighting Obama's public health insurance option. They're fighting against us -- you and me. Insurance companies know that lower costs for us mean lower profits for them.

Resist and overcome the lobbyists. Tell your representative and senators.

-- Millicent Sims, Montclair

My Commentary:

Posted by Zemack on 04/28/09 at 7:26PM

It's a sad, shameful spectacle to witness how eagerly and flippantly so many Americans are willing to give up their freedom.

The "public health insurance plan" advocated by Millicent Sims is just another name for socialized medicine, and denying that is dishonest and evasive. Its sole intention is merely a slow-motion path to totalitarian government control of medicine.

A "public" company (or GSE--government-sponsored enterprise) is backed by the legal force of government, which can subsidize it through taxes, while setting legal restrictions on its private "competitors" through its tax and regulatory authority...etc. A private company has no coercive power, and must rely upon the voluntary private market. To pretend that there can exist "competition" between a government-run "insurer" and a private one is to say there is no difference between an armed mugger and his victims.

Ms. Sims writes:

Obama's public health insurance option could save us up to 30 percent on our insurance premiums by being more efficient and driving down prices across the board...

This is a case of the mugger posing as his victim's savior. Medical costs are exploding because of decades of growing government interference into the healthcare industry, dating back to the 1930s. The natural incentives inherent in a free market...where healthcare providers and insurers compete directly for consumers' business based upon the rights of consumers, providers, patients, and insurers to contract freely and voluntarily with each other to mutual what leads to widely available, affordable healthcare. But those incentives are nowhere to be seen. Instead, the Obama plan takes the immoral route.

It is insane to punish the very people you depend upon for your healthcare by empowering bureaucratic government dictators to "drive [i.e., force] down prices". Doctors, hospitals, pharmaceutical makers and other producers of healthcare products and services are not slaves but free individuals who have a right to act upon their own judgement on setting prices for there work. The rest of us are likewise free to pay for those services or not, based upon our own judgement. This is called justice. There is no inherent right to healthcare provided by others at any particular price. There is only the right to trade our earnings for those services, based upon voluntary, mutual contractual agreement. Those who believe government should use force against providers in the name of lower costs are advocating theft and slavery.

The solution is to discover capitalism. The only just and moral course to take on healthcare reform is to rid healthcare of government interference. America currently spends some $7500 per capita per year ($30,000 per family of four and rising) on healthcare. Almost that entire amount represents third parties spending other people's money. This is a fundamental part of the problem. That money comes from all of us in a myriad of ways, yet leaves us with little control over how it is spent. Leave that money in the hands of the people that earned it through some vehicle like HSAs, end government insurance mandates and the third-party-payer system, phase out existing "public" plans like Medicare, Medicaid, and SCHIP, and let people take personal responsibility for their own healthcare.

Today's problems in medicine represent a failure, not of freedom, but of statist government intervention. The choice we face is not between a government-run healthcare dictatorship and the status quo. The choice we face is between being held hostage to government central planners, or taking control of our own healthcare in a truly free market.

Saturday, April 25, 2009

Insurers Seeking regulation

Insurance regulation needs a new approach

Posted by Frank Keating, Steve Bartlett and Leigh Ann Pusey/ Star-Ledger Guest Columnists April 24, 2009 5:58AM
Categories: Economy, Policy Watch

AP File Photo/ Michael Manning
Former Oklahoma Gov. Frank KeatingShould the federal government be completely walled off from monitoring a $6.4 trillion industry that does business across state and national borders and affects the lives of nearly all Americans?

That is the question that the nation's policymakers must answer as we all grapple with the fallout from the financial crisis and seek ways to assure it does not happen again. The $6.4 trillion industry is insurance; the folks who assure lifetime financial security and protect the value of everything from the family house to the automobile.

Although the insurance industry is as important to the financial services matrix as the banking industry and the securities industry, there is no federal insurance regulatory office comparable to the Office of the Comptroller of the Currency, which regulates national banks, or the Securities and Exchange Commission, which regulates securities.

Since the 1850s, insurance has been regulated at the state level. While that system has performed reasonably well, today's insurance industry is much more complex than it was in the 19th century. To bring the industry into the 21st century, the government must begin regulating insurance at the federal level. In order to do so, Congress must create a national insurance charter overseen by a new Office of National Insurance.

This idea has broad support.

In testimony before the Senate Banking Committee, Treasury Secretary Tim Geithner hinted that he believes a national insurance charter is a good idea and expects it to be a part of meaningful regulatory reform.

Federal Reserve chairman Ben Bernanke told lawmakers that a national regulator for insurers was a "useful idea." He also noted that regulators did not have effective holding company supervision and that implementing such a structure should be given "serious consideration."

And the Group of Thirty -- an influential, non-profit organization of the world's leading financiers and academics -- recently released a report calling for a federal insurance charter. The report was authored by one of President Obama's key economic advisers, former Federal Reserve chairman Paul Volcker.

An insurance regulator at the national level is needed because insurance markets have evolved and now transcend the current state-based system. Today's financial markets are globally interconnected. Problems in one country or one market sector can pose risks to the entire financial system. State regulatory agencies are simply not equipped to address the macroeconomic problems of today, which affect many nations and require the coordinated efforts of several agencies. Such coordination is exactly what would be expected of the new regulatory body, and it would be perfectly positioned to deploy industry-wide solutions to emerging crises.

Establishment of a national insurance regulatory authority should be comprehensive, but not supplant state insurance regulation. Just as with banks, many insurance companies and their customers may choose to remain under state control. But a national insurance regulatory office would allow the government to monitor insurance markets and identify potential risks to the financial system.

This new regulator, both through its direct responsibilities and through its contacts with other financial regulators in the U.S. and abroad, would be able to monitor the insurance marketplace and identify and address problems before they reach the crisis state. This regulator would function with a broad vision not available to a state regulator, whose focus is necessarily limited to local issues.

However, this is not a call for a costly new Washington bureaucracy. A recent report from the Promontory Financial Group, a consulting firm, suggested that a federal insurance regulatory office could rely on fees paid by regulated companies. Taxpayers would bear no additional costs but would enjoy countless new advantages, like truly personalized policies.

As Congress and the Obama administration look for ways to get our economy back on track, it's imperative that they recognize the important role of insurers in the nation's financial system and in the lives of millions of Americans. In the future, the states will continue to play a vital regulatory role, but a new, federal regulatory framework for the insurance industry is vital. Sensible modernization would ensure that consumers and businesses have the insurance options they need to help revitalize the U.S. economy.

Frank Keating, former governor or Oklahoma, is president and CEO of the American Council of Life Insurers. Steve Bartlett is president and CEO of the Financial Services Roundtable. Leigh Ann Pusey is president and CEO of the American Insurance Association.

My Commentary:

Posted by Zemack on 04/24/09 at 10:23PM
This is incredible! To avert a crisis in the insurance industry, we must adopt the same central planning and regulatory framework for insurers that caused the financial crisis! Yet, everywhere one looks, one sees government interference as the culprit in the banking disaster.

There was the Federal Reserve's housing bubble-expanding low interest rate, inflationary credit expansion policies.

We have the FDIC, which encourages risky, imprudent lending...then, when irresponsible banks fail, punishes sound prudent banks by raising their premiums to cover the failed banks' depositors. This, in the name of "protecting" savers.

There are the GSEs--Fannie, Freddie, and Ginnie Mae--which under intense political pressure bought up massive amounts of sub-prime loans, which were then packaged into CDOs for sale around the world. This allowed outfits like Countrywide to originate-and-sell sub-prime mortgages to its heart's content.

There are the three government licensed and protected rating agencies (Moody's, S&P, and Fitch), which were encouraged to grant investment grade ratings to these securities based upon an implicit government guarantee.

There is the CRA, the political wedge through which the sub-prime cancer was introduced into the nation's credit bloodstream.

There was the rigid mark-to-market accounting rule forced on the industry through the government's control of accounting standards, which drove otherwise solvent banks under.

Then there was (and still is) the whole government network of "affordable housing" policies and programs, such as FHA-insured mortgages and "anti-discrimination" rules which enable economically unjustifiable loans.

These and other market-distorting interventions combined to create a mighty conveyor belt of bad lending and inflating home prices that culminated in the housing bust...the fundamental cause of the current recession. The toxic assets likely being carried on the insurers' books can be traced directly to the financial crisis. And this crisis occurred within the context of a heavily regulated, centrally controlled banking and financial industry beset by massive government interference into the mortgage and housing markets.

Yet these insurance industry representatives want the same for their industry, it seems.

To be sure, legal reforms are needed, especially where it relates to health insurance...a market beset by bad tax policy, thousands of government mandates, and trade barriers to interstate competition. But to place the insurance industry into the same federal regulatory straightjacket that brought us the financial crisis is ludicrous. There must be more behind the call by the authors of this article for federal regulation than rationalizing the state-based system.

Perhaps, as suggested by correspondent jbken and John Bury in his related article here, the insurers are willing to sell their souls for a government bailout. Traditionally, businesses seeking government regulation do so in the expectation that they will be pulling the regulatory strings through political connections, or of being shielded from the rigors of market competition.

But whatever the reason, the unholy rush to expand central political regulation and control of business, coupled with industry's willingness to submit to the "protective" embrace of government officials, can only end badly for America. As can be seen with the banking crisis, government regulation and control opens the door to political interference and influence peddling, and is inherently and irredeemably corrupt. We have seen this pattern before. It is the road to fascism.

The right direction to move is toward decontrol and a free market, where government's role is as envisioned by the Founders...a policeman that protects individual rights. This means the vigorous enforcement of laws against fraud and breech of contract. Otherwise, insurers should be fighting for the right to act upon their own judgement in issuing insurance products based upon competition, customer demands, rational risk assessments, and profit expectations. Badly run companies should be allowed to fail, and strong one's to reap their rewards.

The profit motive within the context of a free market rewards personal responsibility and the long-term perspective, and thus is our best protection against future meltdowns. Centralized control and regulation guarantees more calamities.

Other Commentary:

Posted by jbken on 04/24/09 at 10:35PM
dustybuns & Zemack:

You're both missing the point. The insurance industry wants federal regulation now so they can get bailout money too - and they need it.
Did their investment guys see this coming better than the banks? NO! They have the same junk, it's just that they don't have to tell anybody because state regulation is so weak and they can't tell anybody or else the source of their funds (selling insurance) dries up.

These three are just stooges for the industry and it's no coincidence that the Allstate guy, Tom Wilson, had that NY Times editorial last week begging for federal regulation. It's really the only way to save your jobs at this point.

My Response:

Posted by Zemack on 04/25/09 at 10:24AM


Actually, I think I do get it. I wrote:

The toxic assets likely being carried on the insurers' books can be traced directly to the financial crisis. And this crisis occurred within the context of a heavily regulated, centrally controlled banking and financial industry beset by massive government interference into the mortgage and housing markets.

Yet these insurance industry representatives want the same for their industry, it seems.

Perhaps, as suggested by correspondent jbken and John Bury in his related article here, the insurers are willing to sell their souls for a government bailout.

The authors point to the financial crisis as a justification for more control and regulation, despite the overwhelming evidence that it was just such central planning that caused the crisis to begin with.

Related article:

Why Insurers Want Federal Regulation Now

Posted by John Bury April 24, 2009 9:44AM
Categories: Insurance
Last week Tom Wilson, CEO of Allstate, had an op-ed piece in the New York Times begging for federal regulation of the insurance industry. Today, in the Star-Ledger (and presumably any paper in the country that had exhausted the Obama dog story angles), three insurance insiders made their case for federal regulation.

This is something I have been pushing for decades, from letters to the Times to this blog. Why the push now from inside the industry? It seems obvious to me. Simple survival.

No fiscally responsible person would voluntarily invest in any insurance product these days. (Though that still leaves a substantial pool of suckers, those are not usually the people who have the big money.) Insurance is essentially the process of paying now for the promise of repayment later. If you can't trust that the company will be there later, you won't buy their product. Insurers need that federal charter as a marketing tool since nobody with any sense sleeps easier knowing that state guaranty funds back up those promises.

Insurance companies are basically investment vehicles. That's how they have historically made their profits. They take in $100. They invest it to get an extra $10 and a year later they pay out $100 in claims. The $10 they get to keep. Works like a charm until that investment part either goes away or turns negative. That it did over the last year but since insurance companies are essentially unregulated, it's not widely known.

Surely many Insurers must have the same toxic assets in their portfolios as those banks that are being bailed out but how are you going to find that out? Will you contact the Montana Insurance Department or whatever state your insurer is domiciled in? How about checking with a credit rating agency?

Banks had the FDIC to reassure their customers that, even if the bank itself was shaky, the federal government had the safety net out. Now, put yourself in the shoes of an annuity salesman the day after Harry Reid blurted this out. What are you going to tell your next sit? That the state of New Jersey has a guaranty trust that will protect them in a worst case scenario. Even the most naive insurance consumer knows enough to be wary when the words "New Jersey" and "trust" are linked.

Insurers desperately need a federal cash pipeline to cover losses they will inevitably incur. State funds are inadequate and, in any case, Guaranty associations obtain funds for their operations and payment of claims through assessments against the solvent insurance companies. That means insurers will need to clean up their own mess unless they get access to the federal government printing presses...and soon

Thursday, April 23, 2009

ExxonMobil, Property Rights, and the First Amendment

In response to my Earth Day post at Principled Perspectives, The "Anti-Industrial Revolution" Rolls On , Harold left these comments.

My comments followed.

The ExxonMobil case that I wrote about is a symptom of the serious and growing deterioration in the rule of law in America, brought about as a consequence of a mixed economy.

Wednesday, April 22, 2009

Tea Parties Past and Present

From the Star-Ledger Reader Forum, April 22, 2009

Letter #1

Defends tea partyers
I object vehemently to the charges by reader Lawrence Uniglicht in his letter to the Readers Forum, ("No tea for me, thank you," April 18) that all those protesting increases in taxes and an overspending government are malcontents and clowns. I suggest people look at Govs. Jim McGreevey and Jon Corzine, and Sens. Frank Lautenberg and Robert Menendez if they want to see clowns.

The protesters did not throw tea into Boston Harbor to start a war with England, but peacefully assembled to protest a fearful trend by a Democratic Congress and administration to take away our constitutional right to life, liberty, and the pursuit of happiness that our founders fought so hard to win. Protesters were from all walks of life. They did not break store windows, overturn and set fires to cars, or fight with the police. They personified what Americans are -- hard-working, law-abiding, and moral citizens.

As for constructive ideas from the Republicans, tea party opponents should know there were many proposals that were denied by the Democrats in Congress, mainly because they would be successful in restoring the economy to the way it was before 2006. That was the year the left-wing voted in a Democratic Congress, and we have been sinking toward socialism ever since.
-- Richard A. Ketay, Newark

Letter #2

History doesn't repeat
Once again, the American people are responding like sheep. A case in point is the recent "tea parties" across the country.

Had protesters been paying attention, they would realize the tax rate on the wealthy will only increase from 36-39 percent, far below the 90 percent rate under President Dwight Eisenhower.

The nationwide tea party, which was created to oppose taxation, borrowed its name from the Boston Tea Party. As a history teacher, let me take the opportunity to remind the American public that the Boston Tea Party was not about taxes. It was staged to protest the monopoly being granted to the East India Tea Company by Prime Minster Lord North, who was a primary investor in the company.
-- James O'Brien, Bayonne

My Commentary:

Posted by Zemack on 04/22/09 at 7:23PM
James O'Brien, the history teacher, doesn't understand the significance of today's Tea Parties, or of the philosophical common denominator linking them to the original Boston Tea Party. Richard A. Ketay does. The fundamental principle linking both across a span of centuries is a profoundly moral one...the uniquely American concept that the individual's life is his and does not belong to any "higher power" such as a king, warlord, democratic majority, state, priest, president, or ayatollah. That principle is embodied in the doctrine of unalienable individual rights to life, liberty, property, and the pursuit of happiness.

The concrete issues are different, but the principle is the same. Any government-imposed monopoly such as the East India Tea Company is a violation of individual rights because it forcibly bans individuals from exercising their liberty to promote their lives through the freedom of production and trade in a particular market. Today's protestors are not concerned with some narrow issue such as 3% in the income tax code. Rather, the massive confiscation of wealth through deficit spending and the forced transfer of wealth to politically connected failed corporations and irresponsible mortgage borrowers are what concern the protestors. This will be paid for either through direct, massive tax increases or through the inflationary back door...the confiscation of the purchasing power of our money through the government printing press.

Worse still is the use of the financial crisis as a cover for a breathtaking dictatorial economic power grab by government through its regulatory apparatus. This, despite the fact that it was the massive buildup over the years of government interference in the housing and mortgage markets, as well as the central bank money monopoly called the federal reserve system, that caused the crisis to begin with. The statist policies of Bush and Obama are a direct assault on America's founding principles of individual rights and a government limited to protecting those rights.

I find it fascinating that Mr. O,Brien chooses to call today's protestors "sheep" for rising to defend individual rights, which means the right and responsibility of each of us to take charge of our own lives. In contrast, President Obama constantly demands that we suspend our own judgement and our selfish concern for our rights (the "old, stale" arguments, as he puts it) in order to "come together" to solve our nations problems. This language is a euphemism for relinquishing control of our lives to central planning ideologues who seek to consolidate federal control over private contracts and corporate governance, energy, healthcare, education, food production, finance and investments, etc.

Who are the real sheep? It is certainly not the Tea Party protestors, many if not most of whom are attempting to build an individual rights coalition to push back against the rising tide of statism sweeping Washington, D.C.

Wednesday, April 8, 2009

On the Future of the GOP

Republicans continue to be the great pretenders

Posted by Paul Mulshine/ The Star-Ledger March 31, 2009 5:02AM

Photo by Justin Sullivan/Getty Images
Is the Republican Party done?
In the past few months, the national Republican Party has experienced a miraculous conversion to the principle of fiscal conservatism.

Let's hope it's a deathbed conversion. I, for one, am ready to see the Republican Party disappear from the political scene. I would like to see it replaced by a party that believes in the U.S. Constitution, limited government, defense of our borders and balanced budgets -- in other words, everything the national Republicans claimed to espouse back when Bill "Slick Willie" Clinton was in the White House.

Now that a Democrat is again in the White House, the Republicans again claim to endorse those sacred values. But there is the small matter of how they behaved in the eight years George W. Bush was in power. And they behaved like . . . let me think of an appropriate invective . . . Oh, yeah, they behaved like Democrats. And now that we have a real Democratic president, they have no grounds to criticize him.

Consider President Obama's response to a reporter's question the other day about Republican criticism of the huge deficits in his proposed budget. Good question. But Obama dodged it with ease. "I suspect that some of those Republican critics have a short memory, because, as I recall, I'm inheriting a $1.3 trillion deficit, annual deficit, from them," said Obama.

Slick Barry will be repeating that argument for years to come. And the Republicans will be powerless to refute it. Their credibility on economic matters is shot and they won't be getting it back anytime soon thanks to the legacy of big-spender Bush.

Here in New Jersey, we saw the same phenomenon the last time the Republicans were in power. Christie Whitman was in many ways a female forerunner of George W. Bush. They were born the same year in the same part of the country into the same Republican elite. I don't think it's unfair to say that the abject incompetence of these two is an accurate indicator of the party's decline.

Like Bush, Whitman took office facing a few simple problems that could have been easily addressed through adherence to Republican principles. And like Bush, she instead accumulated a mountain of debt for various do-gooder projects. A few days after I penned a column railing against her borrowing, I got a letter:

"Dear Paul," it began, "I thoroughly enjoyed your article today detailing the mountain of debt that our governor has accumulated. Yes, we will criticize Governor Whitman in 2002."

It was signed "Jim McGreevey."

This is what happens when Republicans govern like Democrats: They get replaced by Democrats. And just as is happening now, when McGreevey took office the New Jersey Republicans suddenly rediscovered their conservative roots. And everyone got a good laugh, just as everyone is doing now.

If you're in the mood for a laugh, I invite you to visit the national Republican Party website. There you will find a list of the big-spending items on Obama's "liberal fiscal agenda." One such item is Obama's plan to spend billions closing the so-called "doughnut hole" in the Medicare Prescription Drug Program. Closing that gap in coverage is indeed a liberal fiscal policy, but not quite as liberal as the Republican policy that created the program in the first place.

Another legacy of the Bush era is the "Veterans Traumatic Brain Injury and Health Programs Improvement Act of 2007." Obama wants to fund it, but the GOP is opposed. If these are the talking points for next year's Congressional elections, the GOP had better swear its candidates to silence.

The problem with the national Republican Party is the same as the problem with the state GOP. It's run by lawyers, lobbyists and cynical campaign operatives -- just like the Democratic Party. But the Democrats don't pretend to believe in small government. The Republicans do. This is okay until they make the mistake of actually getting elected. Then it all falls apart.

Perhaps you're a loyal New Jersey Republican. And perhaps you think I'm being harsh in my assessment. But let me ask you this: If the party takes back the governorship next year, do you honestly expect to see your property taxes reduced? Or do you expect to hear the same lame excuses you hear from Jon Corzine?

It's the same on the national scene. The Republican Party has nothing going for it but a hope that Barack Obama will turn out to be as politically inept as Jon Corzine. But no one is as politically inept as Jon Corzine.

So the future is not bright for the party that displaced the Whig Party back in the 1850s. I don't know if there are any Whigs left out there, but if there are, let me ask this: Have you guys thought about making a comeback?

While we're on the subject of why the GOP is in decline, I just came across this column from 2002 in which I pointed out how the liberal George Bush and his not-so-smart svengali Karl Rove were assuring the demise of the GOP through unlimited immigration of future Democrats:

Date: 2002/05/05

GOP is migrating toward oblivion

In the first primary election since Sept. 11, Republican candidates haven't had to look hard for an issue that fires up the party faithful. Curbing illegal immigration does the trick every time. At least that seems to be the case in the GOP primary for U.S. Senate.

"It's polling off the charts," says one political consultant. Regardless of political party, Americans realize that it's impossible to have domestic security in a country that has 8 million or so people within its borders illegally.

Well, most Americans. The exception is George W. Bush. Even after Sept. 11 he has persisted with a plan to offer yet another amnesty to those who entered the country illegally. This is perhaps the least popular idea in the history of political polling. In New Jersey, it has a mere 5 percent support among likely Republican voters.

So what is he up to? I had that question in the back of my mind Thursday as I was attending a state Assembly Transportation Committee hearing at the Statehouse in Trenton on problems with E-ZPass. Suddenly the hearing was drowned out by a huge commotion in the plaza below. Drums, whistles, air horns . . . I had no idea what it was, but it sounded more interesting than what was going on in the room. So I headed down to the plaza.

Several hundred people, mostly Hispanic, were demonstrating on behalf of justicia and sindicatos. Justicia means justice. Justice, I gathered from the speakers, meant that illegal immigrants should be able to get driver's licenses, which is almost impossible since Sept. 11. They should also get amnesty, the speakers said. The speakers also said that most illegal immigrants are hardworking people who just want the chance to become American citizens.

I spoke to several people in the crowd who confirmed this. A factory worker from El Salvador complained that he has lived here and worked hard for more than 10 years, but he has no legal status. His two sons are in high school, but when they reach college age they will be ineligible for financial aid or in-state tuition.

It was hard not to sympathize with his plight or with the plight of the many Mexicans at the rally. El Salvador is my favorite foreign country. Mexico is the second. I like Salvadorans. I like Mexicans.

It's Democrats I don't particularly care for.

Like most conservatives, I am philosophically opposed to them. If the Democrats want to hold onto power in America, they should have to do so by convincing the electorate their ideas are better. Instead, they are importing a more favorable electorate. That brings me to the meaning of the word sindicato. It means labor union. The rally was organized by unions. "We are the future!" one union leader proclaimed.

If so, the future is an electorate that is even more likely to vote Democratic than the current electorate. California is a classic example, says James Gimpel, a political science professor at the University of Maryland who has studied immigrant voting patterns.

"There's no question that over the last 20 to 30 years, high levels of immigration have hurt the Republicans in California," says Gimpel. "California used to be a state where the Republicans could win. No more. New Jersey might be a case like that. Fifteen or 20 years ago, New Jersey was a tossup. Now it's expected to go Democratic."

The alleged genius behind the Bush political effort, Karl Rove, is said to believe millions of Hispanics will switch to the GOP if only the Republicans pander to them on issues such as amnesty. Gimpel believes otherwise. Amnesty or no amnesty, Hispanics are likely to keep voting Democratic by large margins.

"There appears to be some people inside the Bush administration who sincerely believe some type of political realignment is inevitable," says Gimpel. "They don't understand how rare realignments are in American history."

The main political impact of an asylum program would be to add millions of new voters, Gimpel says. And if past history is any indication, the GOP is likely to get less than 25 percent of these new voters. The only way to get more would be to offer them the same big-government freebies the Democrats offer.

At that point, why have a Republican Party? The entire strategy is so suicidal for Republicans that Gimpel believes there is more to it than simply Karl Rove's naivete about the nature of the Hispanic voter.

"It may have something to do with the fact the Republicans are doing this for their business constituency. But instead of saying that, they have to pretend they are sincerely attempting to attract Latino voters.

"You can't come out and say that your cheap-labor constituency in the business community is pushing this. You have to say you have fantasies of realigning the new voters."

That won't happen. The only way to convert immigrants to the GOP would be through a cutoff of immigration and a period of assimilation. Bush has a chance to push for that, but he is passing it up.

Failing that, the President should identify some class of foreigners who wish to come here and vote Republican in equal numbers to all the new Democrats.

Who are these people? Maybe the Flemish. Maybe the Walloons. Maybe they don't exist and the Republican Party as we know it is simply doomed.

MORON PERSPECTIVE WARNING: If there is anyone out there naive enough to think Bush was in any way, shape or form a conservative, please read my prior post about his advocacy of driver's licenses for illegals before commenting. And then don't comment.

Intelligent comments on conservative alternatives to the two big-government parties would be appreciated. But if you think the Republicans who blew out the budget and support open borders are conservative, you are in the wrong place.

Also, before commenting, ponder this quote from Ron Paul:

"We talk about personal liberties and balanced budgets. The Republican Party lost credibility because it didn't do any of that. It violated the privacy of individuals. It flaunted the spending and ran up these huge deficits, got us into wars that are not winnable. And those are the real issues."

My Commentary:

Posted by Zemack on 03/31/09 at 7:52PM
Reaffirming a commitment to the U.S. Constitution, limited government, a strong national defense, and fiscal responsibility is indeed vital to any GOP revival. But without a firm philosophical foundation based upon the individual's unalienable rights to life, liberty, property, and the pursuit of happiness--and a government that protects those rights--the phrases cited above have no meaning. Those principles can be found, of course, in the Declaration of Independence.

The GOP must become, first and foremost, the party of the individual. Clearly, the Democrats have come down squarely on the side of the collective society and the authoritarian state. America desperately needs a principled opposition with the courage to present America with a true "choice, not an echo". This means to embrace the following twin pillars of a truly free society:

The separation of religion and state...which means to reject the Religious Right's anti-rights agenda on the marriage amendment, stem cell research, abortion, public school prayer, faith-based initiatives, First Amendment "obscenity" restrictions, etc. Thoughtful Christians understand that when any religious sect demands its agenda be put into law, the rights of everyone...themselves included...are threatened.

The separation of economics and state...which means to embrace economic freedom, or laissez-faire capitalism, as a guiding principle on all issues. This would mean a platform which would include phasing out and dismantling the welfare state including sacred cows like social security, Medicare, Medicaid, and SCHIP; breaking up the public school monopoly and extending school choice to all parents through tax credits (but not government-funded vouchers); a full commitment to global free trade and an open immigration policy with all friendly, non-hostile nations; a return to a gold standard and abolition of the Federal Reserve central bank monopoly, which will break the back of the Federal government's now unlimited ability to confiscate our wealth; and massive tax reduction and regulatory name a few planks.

I believe we are approaching the end game...the climax...of the statist trend of the last 100 or so years in America. The time for a compromising, "mainstream", non-ideological Republican Party has run its course. It will no longer work. It never really has. Decades of GOP compromises have only paved the way for the liberal/socialist Democrats. We are at a tipping point. There is only one defense against collectivism and socialism--individualism and capitalism.

The GOP needs to declare a philosophical "Contract with America". Though important, the party needs to stand on more than the Constitution (which has flaws that contradict our founding principles). The rights of the individual to live his life for his own sake, so long as he doesn't violate the same rights of others, must be the unifying principle for the platform agenda. Mr. Mulshine is right that the GOP has forfeited any standing to criticize the runaway statism of the current Democratic leadership. Only a full GOP commitment to our founding principles, which the Democrats have now openly abandoned, can restore that standing. It will take a lot of political courage and a steadfast focus on the long-term rather than just the next election. It won't be easy. But standing on principle means, well, standing on principle.

The GOP must reject both the economic tyranny of the Socialist Left, and the social tyranny of the Religious Right. It must create a truly big tent...welcoming people from all across the American culture...united by the values of unalienable individual rights and limited, rights-protecting government. The Republican Party, I firmly believe, needs to move beyond the conservative-liberal paradigm; and forge a radical new individual rights coalition to counter the Democrats' full embrace of collectivism.

People will say that this is radical. It's not practical. It won't win elections. Of course, it is radical, in the honorable sense of the term. So was the American Revolution! Freedom is practical. People are capable of managing their own lives. As for elections, do we really want just a political party holding its finger in the air to determine the political wind direction in order to win elections for the sake of winning elections? Real electoral strength begins with ideas.

Do individual rights still "sell" in the only country ever founded on that principle? I believe the answer is yes. Will a political strategy encapsulated by the unifying philosophical/moral principle of individual rights work? I believe it can, and given time, will work. One thing is sure...if we value our freedom; it must work, because our time is running out. Reagan once said, "Freedom is never more than one generation away from extinction". Observing the ominous trends in Washington, we may be that last generation.

Other's Commentary

Posted by sonofbiford on 04/01/09 at 2:06PM

Your eloquence is head and shoulders above most of the posters on this board, and I salute you for it. However, your post reminds me of a major similarity between purists on the left and purists on the right.

Depending on your personality type, both extreme philosophies look good on paper, but neither can be sustained for very long simply because of human nature. In the end, ego will always trump reason, and the expectation that personal morality and ethics be used in driving decisions, is a farce. It is wholly unrealistic.

Purists on the left believe in mandating economic equality, which completely disregards the competetiveness inherent in the human animal. Socialism fails because eventually, someone will break the social contract, and seek to take advantage of the situation for personal gain. Someone always thinks he knows what's best for society, and will impose his will upon society.

The Soviet experiment went horribly wrong very quickly because not so long after one czar was deposed, another one ruthlessly hijacked the revolution, and imposed his authoritarian tyranny under the false banner of "Socialism." One czar replaced another.

Purists on the right believe in laissez-faire capitalism, which is seen as essential to "freedom." This, too, is an unsustainable pipe-dream because of human nature. Competition will thrive in the early stages until clear winners begin to emerge from the markets. Once those winners emerge, a snowball effect begins where the winners become so powerful as to snuff out competition. Unregulated competition eventually culminates in monopoly. Yet, ironically, competition is anathema to monopoly.

When competition is snuffed out, and monopolies take hold, they will do whatever it takes not to lose any gains they've made in the markets, including taking the reins of government (see the revolving door between K Street and Capitol Hill). This is the birth of oligarchy, and in some cases fascism. Going the way of healthy competition, the state fades away into oblivion, and is replaced by the company. Individualism and freedom are negated by default, as anyone with ideas contrary to the ideals of the company, become enemies of the company.

History has shown that both extreme philosophies on the left and the right, are impossible to impose upon society and sustain for any significant amount of time. As the world population increases dramatically, these two dreams will be driven further and further from reality. What is left, and what the world has been doing for several centuries, is fighting for the middle ground. The societies that can achieve a balance that is tolerable to the majority, and can keep their "crazies," in check, are the societies that will survive the longest.

It is the mutt who is always the strongest, and most capable of surviving.

My Response:

Posted by Zemack on 04/01/09 at 10:02PM
The fundamental question at the heart of human relationships is...force or the abolition of force. One extreme is the total rule of brute force, and the other abolishes force altogether, leaving people free to associate based upon reason, persuasion, and voluntary agreement. In other words, statism vs. capitalism.

Contrary to sonofbiford, the two extremes cannot coexist. They are mutually antagonistic. There is no contest between two armed and one disarmed. A mixed economy, such as we have now, means that some people deal by (legalized governmental) force, while others must rely on voluntary association. As we are seeing now with the financial crisis, force overwhelms whatever free market elements there are, leading to still more legalized force and less freedom.

Once free markets are compromised by legalized (political) force, there is no way to draw the line between where freedom stops and force begins. Force will steadily become more and more dominant as a means of achieving economic goals, hence the steady growth in the numbers and power of special interest pressure groups. There is no middle ground, although it may seem like there is at any given time. Since about 1900, the "middle ground" between the two extremes has been a steady (and now accelerating) march toward one of them...statism. This will continue to its logical tyrannical end until and unless the other extreme, laissez-faire capitalism, becomes the principle guiding one of the two major political parties. Then and only then can the statist trend be reversed.

This is the reason for my contention that the GOP must be that party. The basic battle on all issues comes down to the two extremes...either an individual is free, or his life belongs to the state. Either statism is imposed, or capitalism is adopted. America needs an open ideological debate on the two extremes.

I strenuously disagree that neither extreme can work. Man is by nature a rational, egoistic being whose means of survival is his mind. That nature requires individual freedom from force. Capitalism is the only social system that works, to the extent it is adopted, because it is consistent with man's nature. Laissez-faire works best, because it eliminates all force from human relationships.

Sonofbiford's statement on monopolies is wrong, in my view. In a free market, no one can eliminate competition (or potential competition), even a company with 100% of a market share at any given time. Only governmental force can (and does) stifle competition, through coercive means like regulations, subsidies, franchises, etc. I don't want to dwell on this point, because it's somewhat off-topic. But, for a counter-view to the monopoly myth, perpetrated by Marx, read The Capitalist Manifesto by Andrew Bernstein.

Other's Commentary:


I agree in general with the points you made about what the religious right would need to give up, with the exception of making a certain determination on abortion. It's not clear to me whether or at what point the fertilized egg becomes a human being entitled to a right to life. This is completely irrespective of religious questions. We are all fertilized eggs at various stages of development. There is some value in the "viable outside the womb" standard, but I'm not sure it makes sense. Newborns are "viable" outside the womb but still wholly dependent on other humans to keep them alive. I don't think it's clear cut, and as such I don't think we should make a statement on it one way or another.

Naturally I'm not trying to force you to adopt this opinion. I just think that that one is logically debatable, and probably out to be left out of what is otherwise a list of things that ought to be clear from "common" sense.

My Response:

Posted by Zemack on 04/08/09 at 7:21PM
I want to respond to htuosm, because he (or she) brings up a very important point.

I have thought, written, and debated extensively about abortion as it relates to individual rights. The issue is complex, especially as it relates to late-term pregnancies, and is the most difficult point to make. I won't make a lengthy statement here, but I have concluded that the principle is unequivocal. The rights of the woman are paramount. If she doesn't have the right to determine the functions of her own body, then who does? If her rights are not unalienable, then no rights are, and America's key founding principle is negated. To be a consistent advocate of individual rights, a woman's right to her own life must be defended. I am not pro-abortion, but pro-individual rights. (The fact that "Newborns are 'viable' outside the womb but still wholly dependent on other humans" is, in my view, irrelevant to the abortion issue.)

As to the Religious Right, it doesn't have to give up advocating for its agenda. Everyone is free to use his or her free speech rights. What they must "give up" is the attempt to impose their ideas on others by force. But then, they are not really giving up anything since they do not have that right to begin with. No one does.

Sunday, April 5, 2009

Businessweek Debate Room--2

The Economy Needs Ayn Rand

My Commentary:

Mike zemack
April 4, 2009 11:13 PM
It's hard to call this exchange a debate. If I were a serious opponent of Ayn Rand's ideas, I'd be ashamed to call Christina Patterson a representative of my side. Her hissing, uninformed tantrum is more reminiscent of a spoiled child than a worthy participant in Businessweek's "Debate Room."

The fact is, if Ayn Rand's philosophy of Objectivism was dominant in American culture, there would have been no financial crisis.

Objectivism teaches how to live and advance one's life through one's own thinking and efforts, and through voluntary, non-predatory, rights-respecting, mutually advantageous association with one's fellow man. Its cardinal personal virtues include rationality, integrity, and honesty, among others. The consequence would be a benevolent capitalist society.

As a husband, father, and grandfather, I strongly urge anyone seeking a comprehensive guide to a virtuous, self-sustaining, happy life to study the works of philosopher Ayn Rand and Objectivist intellectuals like Onkar Ghate.

Other's Commentary:

Barney Murrell
April 5, 2009 02:36 AM
All the pro-Rand commentators are ignorant of U.S. History, and/or lacking in morality. Today's economic failures are the result of two things: One, failure to recognize that most humans are greedy SOBs and run amok without oversight (remember prisons?) and two, implementation of deregulation legislation that ended with predictable results.

Same thing happened to S&Ls in the 1980s, thanks to Reagan’s deregulation and tax policies. The following Federal Deposit Insurance Corporation links explain the failures that helped bring about the S&L crisis:

The S&L Crisis: A Chrono-Bibliography

History of the 80s

Also, what follows are links to photographic evidence of what results in an unregulated free market pre-Great Depression economy:

Child Labor (Ann would be proud of their “freedom” to work instead of going to school)

Earlier in the 1900s was Upton Sinclair’s “The Jungle” – about labor slavery and the filthy conditions under which American meat was processed.

“The Jungle” was the catalyst for Theodore Roosevelt’s implementation of the Pure Food and Drug Act of 1906.

And then there was the Great Depression

Children of the Great Depression

Hoovervilles from American Memory

Hooverville: Shantytown of Seattle’s Great Depression

If there are any pro-Rand fans that still believe her ignorance is correct then you are one of those who may be aptly described as "greedy no-good SOBs." Just remember, it was the cannon fodder from the lower economic classes (victims of "free markets") that won America’s wars which made it possible for capitalism to exist and Rand to write.

My Commentary:

Barney Murrell offers not even a hint of a refutation of even a single principle of Objectivism.

Instead, he makes the claim that “most humans are greedy SOBs” incapable of freedom (including Mr. Murrell?). This is belied by the historical fact that rising general prosperity and (even relatively) free markets are inextricably linked corollaries (Ex., the contrast between North and South Korea), while central planning of all kinds inevitably leads to economic decline and poverty (example, the Hoovervilles and today’s unemployment statistics). His support of government regulation implies that a gun can impart wisdom and virtue into otherwise “greedy SOBs”. Give any “greedy SOB”, which he claims most humans are, a position of coercive police power over the lives of other men by making him a regulator automatically allows wisdom and omniscience to flow from the (metaphorical) gun in his hand into his selfless brain.

Humans are not evil by nature, but are rather in need of a rational, scientifically validated code of ethics to guide them in their lives and in their relationships with others. Objectivism provides that moral guidance. See the works of Ayn Rand or of Objectivist intellectuals Tara Smith (Ayn Rand’s Normative Ethics, the Virtuous Egoist) and Craig Biddle (Loving Life, the Morality of Self-Interest and the Facts that Support It. ).

The litany of horrors allegedly perpetrated by capitalism, such as slave labor and child labor, were legacies of pre-capitalist societies that capitalism inherited and eventually wiped out. The extraordinary advance in men’s economic well-being that occurred in the 19th century was unmatched by any century before or since, and enabled the creation of the American middle class. While terrible conditions did coincide with the rise of capitalism, they must be viewed in historical context…something that the enemies of capitalism routinely fail to provide. For a properly contextual viewpoint, see Andrew Bernstein’s The Capitalist Manifesto.

Every one of the 20th century disasters cited by Murrell were the result of government interference into the economy, not free people “running amok”. The S&L crisis and the (Hoover-Roosevelt) Great Depression are two irrefutable examples. The failure to understand the true causes of the S&L crisis helped pave the way for today’s financial calamity. See Richard M. Salsman of the American Institute for Economic Research (The Collapse of Deposit Insurance—and the Case for Abolition)and Amity Shlaes(The Forgotten Man—a New History of the Great Depression).

As for today’s crisis, listen to this lecture given by BB&T Chairman John Allison at:

Or visit The Ayn Rand Center for Individual Rights and visit the special section detailing their response to the financial crisis.

Also read Richard M. Salsman's penetrating essay in the current issue of The Objective Standard.

Government regulation is inherently unjust, because it is based upon the un-American principle of presumption of guilt, whereby coercive control is extended over an entire industry because of the wrong-doing (or alleged wrong-doing) of the few. The establishment of the FDA (and its precursors) is a prime example. That its creation may have been supported by many in the pharmaceutical industry does not justify it. Can it ever be calculated how much suffering and premature death has been caused by the FDA, which routinely delays, prohibits, and discourages investments in medicines from entering the market? Fraudulent behavior of the few is dealt with by criminal law in a free, capitalist society. Prisons are for criminals, and criminals only. Placing controls on people or companies innocent of any wrong-doing is a form of pre-emptive law, which is consistent with dictatorship and is incompatible with a free, lawful society.

It’s not that “greedy SOBs” don’t exist in a free market. It’s that capitalism, which protects individual rights, works to their disadvantage. Honesty wins in a society based upon freedom of association. It is the political corruption of the private economy caused by coercive government interference in the free market that empowers and entrenches the “greedy SOBs” (Ex., Countrywide’s Mozilo and the GSEs).

I take particularly strong exception to Murrell’s degrading of our military personnel as mere “cannon fodder” incapable of appreciating and fighting for their own freedom. We owe an incalculable debt of gratitude to our fighting men and women, who by fighting for their own freedom and our American ideals, they protect the rights of us all…thus enabling Barney Murrell to freely advocate for tyranny and against America’s foremost defender of individual rights.