Socialism is a Euphemism for...

Lately, this blog has strayed from economics. The reason for the straying is difficult to explain because the reasoning behind it is uncommon knowledge. Economics is not simply about money, it is about people.

Economics is the study of free markets (or Marx's derogatory term "Capitalism"). Economics does not explain communism or socialism or centralized control because such would be the study of power hungry princes, in other words, politics. The study of free markets boils down to the description of rational behavior in free individuals.

Adam Smith, widely considered the father of economics, wrote two seminal works: The Theory of Moral Sentiments (1759) and An Inquiry into the Nature and Causes of the Wealth of Nations (1776). You can read both from the links given.

Smith addresses virtue in The Theory of Moral Sentiments

VI.I.1
When we consider the character of any individual, we naturally view it under two different aspects; first, as it may affect his own happiness; and secondly, as it may affect that of other people.

This seems reasonable to those with Judeo-Christian values. This section outlines the virtue of "do unto others..."

The cornerstone of Smith's work is individuality, a uniqueness which you might describe as "personality" or  "soul." His concern is with virtue and morality, as he was a moral philosopher at the University of Glasgow. Today, we consider Adam Smith a founding economist but he did not considered himself an "economist." His work defined the field.*

Smith explained why moral behavior is superior to immoral behavior. His frame of reference was Christianity. So, he explained as scientifically as he could, Judeo-Christian virtue. Smith described the "soul" in action through humanity.

Paraphrased, free markets are based upon the belief that individuals have a unique perspective in life and can use that to provide value to others. Your unique person-hood, your soul, is the basis of your value to yourself and to others.

Gross Domestic Product

Many human cultures do not believe in the concept of a unique soul. For humanity in general, gross domestic product is a function of population. The more people, the more a society can produce. Like an ant colony, more ants under the control of a single queen is superior to fewer ants.  This is the logical basis of human collectivism, detachment from individuality.

Free societies value the individual. Production is a function of freedom. Freedom is sustained by virtue.
Virtue is acquired through faith and wisdom. Faith and wisdom require freedom. This is known as the golden triangle of freedom.

It is all very puritanical, but was revolutionary is the late 1700's. This explains why America's founding fathers embraced the concept.

Through the last three hundred years, production from the world's free people has far exceeded the production of the collectivists. Innovation is a product of freedom, the wisdom of virtues, and the faith to persevere. Without freedom, no amount of determination, ability or faith can be focused upon that which the individual is exactly suited to pursue.

In a collectivist society the human being is guided by a collective will, of which no individual has complete perspective, knowledge, ability or accountability. The collective is critically detached from individual humanity. The focus of effort degenerates into what empowers those "in power" instead of what is productive.

For example, a state run health system might invent "pill based abortions" to protect politicians' sexual improprieties. Systems with all power collected by elites might allocate immense resources to building monumental ant hills to honor themselves.

Instances where innovation for the collective also benefits the whole of humanity exist. Such instances are rare. Innovation without individual freedom is slowed, distorted and misallocated.

A powerful colony of human "ants" may steal innovation and riches by conquest. Collectivist empires may spread stolen innovation through their kingdom, but they also destroy innovation which they do not value. It would be astonishing to find an aggregate human benefit from all the inventions by all the worlds' collectivist governments. Yet, a single free nation led humanity from horses and plows to landing upon the moon.

The collective misallocation of resources is a key reason that periods of human enlightenment coincide with flashes of increased freedom and then end when virtue fails. The struggle to maintain a free society is actually an interpersonal struggle within the members of the society. It is a struggle between the virtues of freedom and comfort of entitlement.

Today we see America, the most productive nation on earth, slip as Americans turn toward the security of the collective. Fellow SLOBs site The Liberator Today:

The new normal is revealed in two graphs.   The first graph is the employment ratio comparing number employed to the total population. 

Next is the labor force participation rate, the number of persons who are employed in some way or seeking employment.

Socialism, a How To

From a colder, more scientific point of view, one might argue that the struggle is between the cumulative knowledge and the collective memory of humanity. Fundamentally, knowledge inspires imagination and creation. Memory is suited to incremental improvement and can resent opposing points of view.

Both knowledge and memory are imperfect so individuals rely upon a balance. Collectivist leaders must be portrayed as perfect to maintain power. The surer path is the critical detachment of collected memory. Inspirational leadership is rare and valuable, but unpredictable.

All leaders are tempted by the easier, "more pragmatic" collectivist path. They are tempted by the proven path of tyranny over the individual.

Dividing individuals from freedom is simple. Use either force or deception.

Where free people are more powerful than the government, interrupt the golden triangle with wild promises and temptations.

Free health care, security, guaranteed food, shelter and income are proven temptations to humanity. Replace virtue with meaningless "feel-good" goals to misdirect productive efforts and then claim freedom has failed. Where virtue does not exist, free people ruin themselves, so emphasize the short-comings of those with faith. Discourage faith while diminishing the accomplishments of the risk-takers.

As more people ruin themselves, present yourself as a savior. Offer entitlement in place of self-reliance. Substitute freedom with dependence. Finally, teach fear and isolation with pseudo-wisdom like, "a man must accept his fate or be destroyed by it." Put the people in their place, below, ignorant of their own value.

A broken people is an unproductive people. So promise a reward for their allegiance. Faith promises a heaven for good works. So, promise a heaven on earth, utopia. Promise a reward in the end. Promise retirement.

You may be surprised to hear, there is no Hebrew word for retirement, at least not in the familiar sense. The closest biblical usage is re-vocationed.

Instead of doing the work in the Temple, they were to assist and provide their wisdom for the next generation of Levites.

Older, wiser people might impart virtues to young hearts yearning for freedom. Use the powerful promise of Utopian retirement. Sequester the retired away from the young. Promote division between young and old. Promote the ideal retirement as freedom from obligation. Finally, redistribute the collected wealth of the retired to further dependence upon the state.

Collectivism is simple. Entitlement requires the comfort of dependence.  Dependence requires ignorance of opportunity. Ignorance requires the security of entitlement. Collectivism is subjugation.

(An example of people control in America: http://www.youtube.com/embed/9RABZq5IoaQ?feature=player_embedded )

Conclusion

Humanity's greatest attribute is adaptability  We thrive in tribal societies, agrarian societies, empires, dark ages, ice ages, and more. We adapt to the environment and society. This is our greatest strength, but also our greatest weakness.  

Slaves learn to survive enslaved. Masters learn to oppress. Free people must learn virtues and the faith to forge their own risky path.  These are conflicting human fates separated by courage.

Leaders require character and courage to resist the temptation of tyranny, "character matters."  Over time, our leaders have grown less courageous and less comfortable with citizens who are more wise and knowledgeable than the government. They have turned toward tyranny because they fear their rivals will exploit doubt in the minds of the people. 

A proven way to erase questioning and doubt is by promoting dependence, entitlement and ignorance.  Instead of building us up, they tear us down to enable their lust for power. This is the triangle of tyranny. This is the path of the socialist. This is why socialism is a euphemism for evil.

...and this is why economics is not about money.

notes:

* Due to input from avid readers on economics, we changed some of the wording of this section in respect for the great works of philosophers before and along side Adam Smith. Richard Cantillon's Essay on the Nature of Trade in General (1730?), predates Smith's work but was lost for hundreds of years.

America Progressing Toward Slavery

Remember those stories of Chinese slave labor, and third world country sweatshops? How is it that America rose up and ended slavery and sweatshops? According to Mitt Romney in the New Hampshire debate, "(American) GDP Per capita is 50% higher than Europe". America became the breadbasket for the world. "United States produced between 60 and 70 percent of the world's oil supply". America's armed forces became the world's superpower. American ingenuity was released causing us to essentially invent everything over the last 170 years. What explains it all: Free Markets (or Karl Marx's pejorative: Capitalism).

What has changed?

The Progress in Progressive is Toward Slavery

Progressivism is rolling back the individual freedom and innovation that this country at one time personified. We are progressing toward a slave society; a society where the rich use poor and middle class people as natural resources. We are progressing to a society where individuals will no longer hope to start their own business due to regulations, legal and insurance paperwork, taxes, a corrupt bureaucracy and cronyism.

Doo Doo Economics Blog 9/30/2011: President Obama signed the America Invents Act into law. A full discussion of this action can be found on The Blaze, but allow me to summarize. America now has Europe's patent system. You know the system that does not work. The system that makes innovation by small business, responsible for 100 percent of U.S. job growth over the last 35 years, impossible. The European system where "less than 1 percent of patents are filed by job-creating small businesses and independent inventors compared to 28 percent in the U.S." as Business Insider guest writer Henry Nothhaft writes.

I blame Progressives because their social programs enable slavery to once again compete with free markets. Consider Obamacare: instead of an employer competing for workers by offering benefits like health care, the meager $2,000 annual "penalty" or "exchange buy-in" encourages employers to drop health care insurance instead of paying on average $17,000 per year. Many health insurance companies and doctors are leaving medicine before the law is enacted. This is a precursor to an eventual government-run, "single-payer" medical system.

In this way, Obamacare offloads the cost of production to the public sector. Everyone is sold that they can live at the expense of everyone else. In truth, their children and those more financially well off but without waivers are pushed into perpetual debt. Government debt, taxation and regulation leave the masses desperate and without hope for a better life. The American dream is to have your own house, your own business and "get ahead" financially.

Government dependence destroys this dream. Section 8 housing, the lack of classical education and demonizing those who succeed ensure the dream is unattainable. In slave vernacular, those who succeed are "house" not "field" workers.

Capitalists (free traders) must pay for all the costs associated with a product or service. Like a communist Chinese slave state, American progressive policies use public funding to balance a lack of innovation, productivity and risk with the services of desperate "illegal", dependent and miseducated workers.

The same can be said for retirement and pension plans vs. social security.  Home interest deductions, solar panel subsidies and other tax credits may similarly be viewed as reducing the pay required to retain labor. Any entitlement programs relating to essentials that would otherwise require income also offload the cost of production to the public. All of these costs would be borne by the entrepreneur in a free market, thus the competitive drive for innovation and value.

It was innovation that allowed America to end slavery and embrace self-reliance. Free markets made America great. The destruction of innovation and self-reliance is the indicator that we are "progressing" back to slavery. When slave labor becomes more cost effective than skilled workers, you are dealing with progressive tyranny.

Let me reiterate that all of this "everyone living at the expense of everyone ELSE" is a fallacy.  Either we must pay for these benefits through taxes, or our descendants will be saddled with the additional debt. Eventually, this scheme collapses, ironically, because it is not "sustainable." The only "sustainable" path is self-reliant, free-market, capitalistic FREEDOM!

Epilogue - Post Script

The American worker is a productive marvel. There is no doubt that as government slaves we would be highly sought after. The problem is that Americans require self-reliance and independence. We require the ability to keep what we have earned. America requires the hope for a better life. Without these things Americans will be no more productive than anyone else.

Further, miseducation at Harvard and other "elite" institutions is just as worthless as and more dangerous than politically correct miseducation at your local community college. Having the ability to quickly learn, retain and comprehend that 1+1 =3 is no more valuable than badly learning it. However, the Harvard elitist class, that has led America so far astray, is far more dangerous because they have been taught to unquestioningly believe that they are actually better than everyone else. They will not be swayed by logic and reason because some expensive professor knows best. To admit that they are wrong would invalidate that expensive degree and illuminate the missing "think for yourself" wisdom that most of America learns at an early age.

Finally, I find it amazing that America currently tolerates the "illegal alien" invasion. These poor souls may be better off in America, but the truth is that unscrupulous people use them as cheap, slave-like labor. America fought the Mexican-American War from 1846 to 1848, prior to the civil war:

The war had been widely supported by Democrats and opposed by Whigs. Many Northern abolitionists (Republicans) attacked the war as an attempt by slave-owners to expand slavery and assure their continued influence in the federal government. Henry David Thoreau wrote his essay Civil Disobedience and refused to pay taxes to support the war. Former President John Quincy Adams also expressed his belief that the war was an effort to expand slavery.

With American successes on the battlefield, by the summer of 1847 there were calls for the annexation of "All Mexico," particularly among Eastern Democrats, who argued that bringing Mexico into the Union was the best way to ensure future peace in the region.

(Italics ours)

Democrats have a long history that is continued today. At the end of the war, congress debated annexing all of Mexico, but there was no doubt that Democrats would make slaves of the Mexican people. I am a steadfast Tea Party patriot, but my Republican roots are deeply abolitionist. It is difficult to believe that this battle is ongoing and again threatens America. It is astonishing that minorities vote for the pro-slavery, anti-civil rights Democrat party.

The Democratic Senate Majority Leader, Lyndon Baines Johnson from Texas, realized that the bill and its journey through Congress could tear apart his party, whose southern block was anti-civil rights and northern members were more pro-civil rights. Southern senators occupied chairs of numerous important committees due to their long seniority. Johnson sent the bill to the judiciary committee, led by Senator James Eastland from Mississippi, who proceeded to change and alter the bill almost beyond recognition. Senator Richard Russell from Georgia had claimed the bill was an example of the Federal government wanting to impose its laws on states. Johnson sought recognition from civil rights advocates for passing the bill, while also receiving recognition from the mostly southern anti-civil rights Democrats for reducing it so much as to kill it.

Nobody Ever Got Rich By Working For An A-Hole

There are a lot of ways to motivate the people around you. You can push and pull, carrot and stick, pay or whip, pester or praise, scream at or celebrate your fellow workers. Many workers need motivation, organization, management and refocusing, but there is a line that should not be crossed. That line is summarized by remembering that "nobody ever got rich by working for an asshole."

Our economy is based upon mutually beneficial relationships. Relationships based upon strengths, weaknesses, knowledge, ability and comparative advantage. Relationships that are not mutually beneficial are not maintainable and people who exploit this fact are assholes.

Pushing people to the limits and beyond can be mutually beneficial. This may open new horizons for those involved, but setting goals at unachievable levels without consensus burns people out. It damages their lives in innumerable ways and reduces their overall productivity. In short, it is not mutually beneficial. This behavior is the reason that many workers formed trade unions to oppose exploitation in centuries past.

We often hear about Microsoft Millionaires and Bill Gates is no choirboy. However, with the revelations that Steve Jobs was an exploitative asshole, it comes to mind that there is no such thing as an Apple Millionaire. There are people who made money on the stock, but I have not found one story of an Apple employee becoming vastly wealthy beyond Steve Jobs and Steve Wozniak and the forementioned article may explain why:

He cheated his friends out of money. He cut old colleagues out of stock options. He fired people with peremptoriness. He bullied waiters, insulted business contacts and humiliated interviewees for jobs. He lied his pants off whenever it suited him – "reality distortion field" is Isaacson's preferred phrase. Like many bullies, he was also a cry-baby. Whenever he was thwarted – not being made "Man of the Year" by Time magazine when he was 27, for instance – he burst into tears.

As for critiquing the work of others, Jobs's analytical style was forthright: "too gay" (rabbit icon on desktop); "a shithead who sucks" (colleague Jef Raskin); "fucking dickless assholes" (his suppliers); "a dick" (the head of Sony music); "brain-dead" (mobile phones not made by Apple).

...nobody every got rich by working for an asshole.

The Day After Capitalism

In 1791, a new economic system was tried. It was called Capitalism and based on Adam Smith's philosophical arguments. The primary focus of capitalism was finding an alternative to slavery in various forms.
Slavery in the form of kingdoms, dictatorships, empires, and other barbaric violations of mankind's basic freedoms has dominated human history. Even religions imposed a basic requirement that limited your access to your God or Gods through a master.

Along came a man named Cicero who spoke of Natural Law. A few years later a "magician" named Jesus took up the cause and birthed a movement based upon individual salvation via direct relationship to God. These philosophies weighed heavy on Adam Smith. He was a devout believer in individual salvation, individual morality and individual worth and through his book "Theory of Moral Sentiments"; a new economic idea began to take shape.

What if each person could harness their own unique value and create a "Free Market" that enabled anyone with a unique idea, skill, or value of any kind to trade with other willing "Free" individuals? What if government did not control "Trade" or regulate who could participate in the creation of wealth? In answering these questions and because Smith had "Had enough" of Kings and mercantilism, Capitalism was created.

It was a beautiful idea and "Free Markets" led to "Freedom" from slavery as British Colonies in the New World established independent and entrepreneurial territories. Poor Englishmen began to travel to America as indentured servants who traded several years of labor for their passage toward a better life. In 1619, a Dutch slave trader traded his cargo of Africans for food at Jamestown. Africans were traded at Jamestown for food and English women cost about 120 pounds of tobacco.  The term slave began use around 1660. In 1662, Africans became servants for life.  By 1680, slaves had become essential to the economy. There was no alternative to slavery at that time.

By 1775, many tobacco growers were perpetually indebted to the British government connected mercantilists and a "Tobacco War" began. Freedom in America was being taken away through British law and financial cronyism. David Hartley called slavery "contrary to the laws of God and the rights of man." In addition, in 1776, the Declaration of Independence was drafted and for the first time in modern western history, a people declared themselves self governing and free from the King and thereby free from slavery.

"How is it," asked British author Samuel Johnson, "that we hear the loudest yelps for liberty among the drivers of Negroes?"  Johnson did not realize the high regard for hard work and genius that American Colonists like George Washington held for everyone around them.

Washington readily recognized and applauded the talents among the enslaved. In early 1776, he received a poem from a young woman and, "with a view of doing justice to her great poetical Genius, I had a great Mind to publish the Poem." In gratitude for her gift, he invited her to visit his headquarters in Cambridge. The poet was the now famous Phillis Wheatley, who was then an enslaved Bostonian. In writing of and to her, Washington made no reference to her race: a remarkable omission by the standards of his day (and of our own). In private correspondence during the 1780s and 1790s, Washington repeatedly expressed a devout hope that the state governments would legislate "a gradual Abolition of Slavery; It would prevent much future Mischief." (Chronology on the History of Slavery)

During the American Revolution, the abolition of slavery began. Virginia 1778, the importation of slaves was ended and all slaves in the state were considered legally free. By the Constitution of 1780, in the Commonwealth of Massachusetts persons of color were declared citizens of the state. In 1783, the Revolution successfully ends. George Washington becomes the first President in 1784 and he is intent on ending slavery.

"I never mean (unless some particular circumstance should compel me to it) to possess another slave by purchase; it being among my first wishes to see some plan adopted, by which slavery in this country may be abolished by slow, sure and imperceptible degrees."--George Washington, September 9, 1786

The only economic idea available to counter slavery was Adam Smith's capitalism requiring each individual to be moral and educated. The American public school system began focused on teaching people to read The Bible. Within 100 years, slavery is abolished in Britain and America and a new era of human prosperity and freedom begins.

Unfortunately, tens of thousands of years of social drive to rule other men did not die with the abolition of slavery. Slavery has arisen with many new names under the pretext of religious and political systems. The major tools for human slavery include submission to a God through dependence upon his self-proclaimed leaders and submission to government through economic dependence.  Pseudo-economic interventionist dogma is used by both religious and political promoters of slavery. 

"Socialism" in its various forms has arisen as the most popular form of slavery.  Communism is slavery based upon class warfare. Fascism is slavery based on racism. Sharia is slavery based upon religion. Each of these political systems share red "socialist" banners. All were kept at bay through capitalist economic prosperity, individual bravery, faith and strength.

Since people generally do not "yearn to breath slave" attacks upon capitalism became the primary marketing tool. Blaming banks or "the rich" have been the most successful appeals to envy and hate. Slogans like "for the people," "hope and change," and "social justice" remain common propaganda tools appealing to group identity. Obfuscations emerged such as labeling fascism "right-wing" and coloring electoral maps to represent socialists as blue and opponents as red. 

Intimidation is the most central theme in slavery through human existence. Political correctness is the westernized tactic to keep people from discussing the failures and irrationality of slavery in its various disguises. Ignorance through miseducation and distraction is the second tenet of slavery. When these tactics fail and groups rise up in opposition they are assaulted and intimidated with personal attacks, demonization, vilification, slander and eventual violence through legal or illegal channels. Ignorant masses are exploited as the tools to exact violence upon the brave and the free.

The day after capitalism came as a shock to an entitled and miseducated public. "Free markets" converted to "slave markets" quickly as people realized that they no longer could provide for themselves or their families. Ignorant and ill equipped to defend themselves, masses of people were fooled into hating and assaulting the people who could stand up to the slave masters. Promises of "social justice" and "equality" appealed to the desperate. Code language was used to identify people to be voilently targeted by those "springing up for equality."

As the dust settled it became clear that essentials were scarce and there were no alternative leaders remaining. Opponents had all been injured, broken or destroyed.  Opposing political groups had been infiltrated and "moderated." Green re-education taught people to live with less and less in submission to "a better planet" and "more sustainable" service to the ruling class.  The tired, poor, huddled masses had no one left to believe in them, only rulers who required their belief.  To satisfy this requirement now requires service, servitude...slavery. The only alternative is to live without income, financial assets, healthcare, education and legal rights as citizenship now requires participation in the master's plan.

Timothy Geithner Says Obama Reforms Unstoppable

Speaking at the Harvard University Shorenstein (Joan) Center on the Press, Politics, and Public Policy, Timothy Geithner revealed his arrogance with a parade of unreported comments. Although the mainstream media will not report the meaning of his words, C-SPAN does have the comments available in video and transcript form.

Important Geithner take-aways are:

• He misunderstands or is intentionally mischaracterizing the debt ceiling as if it were debt default (31:30)
• His has disdain for impudent debt ceiling discussions, "You've got to be kidding." (48:56)
• Corporate Tax Reform is possible, but No Flat Tax. (49:09)
• People just "don't understand" that we know better. Just forget about the fact that Democrat big government programs created the problem. The slow recovery is a "Tragic consequence of what caused this basic problem." (56:06)
• "We don't have the option" of a faster recovery. (59:32)
• Those Tea Partiers can't stop us now. "I don't think that they can touch the basic architecture of the reforms." (1:00:00) He believes that Americans will choose security and safety over capitalism and freedom.

Obama's Secretary of the Treasury is just another political hack. The most ridiculous parts of his presentations are when he tries to stay away from political questions. Pretending to be non-partisan while pursuing the Fundamental Transformation of America.

As a side note: What was up with C-Span today? The website thinks that both yesterday and today are May 17th. Talk about a filing error!  (Finally they fixed it!)

Adam Smith was not an Economist.

Today, we hear the name Adam Smith and envision a stuffy old economics professor droning on about various econometrics. You may think of a powdered wig from the late 1700's, or a thick book that is far too imposing to actually read. We forget that economics is the study of free markets. Adam Smith's rail against big government-big business collusion is what Karl Marx calls "Capitalism", so it is difficult to label him an economist. It is like labeling Jesus a Christian.

Adam Smith was a moral philosopher brought up in a Judeo-Christian system. He wanted to find a way for the poor to rise up through a westernized, Judeo-Christian moral system. That free market system is what we study in economics today as "Capitalism."

Theology is not my strongest suit, but the parallels between the fundamental tenants of Christianity and Capitalism are clear. The government promotes certain aspirational goals by setting the legal and regulatory framework for free markets much like a Church dictates which virtues are most valued. Furthermore, the individual Capitalist's unique perspective allows him or her to provide value to the community which is very similar to an individual's "soul" in religion.

Capitalism's strongest moral sentiment is against the collective and for the individual. Governments and big businesses grow detached from morality as individual choices become detached from the ability of the community to admonish bad behavior by individuals within the system. As more immoral and illegal behavior can be blamed upon "systemic policy," the more out of control the entity becomes. For this reason, Adam Smith's moral philosophy relies upon the failure of "too big to fail" entities to provide opportunity to the moral individual through "creative destruction." It sounds like the story of the Great Flood to me.


(This was written as a example submission to a popular San Diego news media outlet.)