Friday, July 29, 2011

Eliminate the Debt Ceiling

The official position of the Libertarian Party is to say "No" to raising the debt limit. It is a perfectly sensible position, because the alternative is the destruction of the dollar through inflation, and then hyper-inflation. The federal government is going to have to adopt austerity measures someday, whether by choice or by circumstance inflicted on the country. Of all the major party presidential candidates, only Ron Paul and Gary Johnson have spoken about the need to bring the finances of the government under control, and have spoken about how if the hard choices aren’t made now they will be made for the country later.

The problem is, the sane voices won't be heard. The Keynesians and Monetarists who control fiscal and monetary policy in the government will never accept that anything should actually be cut, other than a few token items of window-dressing. Their plan is to keep raising the debt limit every time it is reached. The entire show is Kabuki Theater because the Congress and the President know that the voters are actually watching this time and actually demanding that something be dome about the excessive spending.

But they do not believe in restraint. So perhaps the opposite approach should be taken on the debt ceiling issue. Give them exactly what they want, but give them more of what they want than what they are asking for. Eliminate the debt ceiling. Pass the necessary legislation to tie all government debt issuances to the budget, so that the Department of the Treasury can automatically sell debt as needed when needed without any restraint other than the budget passed by congress.

As crazy as that idea sounds, it has some advantages. The first is that, since sane voices are not able to engineer austerity measures directly, this would be a way to engineer them sooner rather than later, perhaps avoiding the final stage of hyperinflation. Although the Keynesians and Monetarists will never understand it, eliminating the limit entirely will signal to lenders that the United States government has no intention of getting spending under control and therefore is not a good risk for lending. This will cause the austerity measures to start sooner rather then after hyperinflation ruins the country.

Another benefit is that it ends what is a side-show, albeit a side-show that is much closer to the real issue than those in charge would like. Even after two congressmen in a row have resigned over sexual misconduct issues the attention of the public is still on excessive spending. Since the public is actually watching the government instead of the tabloids the debt limit is what is being debated instead of the actual imbalance. A "ten year plan," reminiscent of Soviet five year plans, is introduced with back-loaded spending cuts, and the public isn't buying it. Tax increases, which will eventually be necessary, are proposed without actual cuts, and the public isn't buying it. So everyone in Washington is debating the debt limit, and how the government will shut down without an increase to the debt limit. Eliminating the debt limit will force discussion on the budget instead of on an artificial self-imposed limit.

Although it would be disaster, there is a disaster coming anyway. So perhaps the best thing is to be intentionally wrong so that when the San Sebastian Mines are seized, the truth about them is laid bare for the world to see.

Saturday, July 23, 2011

Why the Government is out of Money

Recently the University of California has provided a microcosm of what is wrong with the government budget. The University system is cutting back programs and tuition is going up to pay for the budgetary shortfalls. Of course, that is not all there is to the story. Not all programs are being cut. The diversity programs are thriving.

Not only have diversity sinecures been protected from budget cuts, their numbers are actually growing. The University of California at San Diego, for example, is creating a new full-time "vice chancellor for equity, diversity, and inclusion." This position would augment UC San Diego’s already massive diversity apparatus, which includes the Chancellor’s Diversity Office, the associate vice chancellor for faculty equity, the assistant vice chancellor for diversity, the faculty equity advisors, the graduate diversity coordinators, the staff diversity liaison, the undergraduate student diversity liaison, the graduate student diversity liaison, the chief diversity officer, the director of development for diversity initiatives, the Office of Academic Diversity and Equal Opportunity, the Committee on Gender Identity and Sexual Orientation Issues, the Committee on the Status of Women, the Campus Council on Climate, Culture and Inclusion, the Diversity Council, and the directors of the Cross-Cultural Center, the Lesbian Gay Bisexual Transgender Resource Center, and the Women’s Center.

The University of California San Diego is cutting its master's degree programs in computer and electrical engineering, showing that according to the leadership of that university it is not engineering that will lead to a productive and prosperous future but it is diversity training that is what students need most to succeed after graduation. Meanwhile prize faculty are being bid away to other schools, such as three professors from the biology department who were offered a 40% raise to teach elsewhere.

Already it is apparent that college education is the most recent bubble to start to go down in an economy composed almost entirely of bubbles. Due to unemployment and underemployment as well as due to the ever accelerating increase in costs, the lifetime earning differential of a college education is falling below the cost of that education. In general college education is becoming a bad investment.

This one example from the University of California San Diego combines many of the problems with government today. Diversity programs are emphasized at the expense of science programs in an education that costs more and delivers less. The political is emphasized at the expense of the economic to deliver high cost solutions that fail to solve anything and due to their cost interfere with actual efforts to solve society’s problems.

Saturday, July 16, 2011

What does "Environmentalist" mean?

One of the greatest challenges in political discussion is undefined terms. Not all terms are undefined, but those that are generally are deliberately undefined. Being deliberately undefined, it enables the speaker to shift between definitions whenever it is advantageous to do so. One such term is "environmentalist."

The term can mean anything from "someone who wants a clean environment" to a specific ideology. But if a critic uses the latter definition, those criticized default back to the former definition in an effort to use the government fallacy to prove the critic desires a dirty environment.

But if one tries to start by defining the term ahead of time, those who use the term "environmentalist" as a self-descriptor complain bitterly about how the critic is defining terms in a negative way.

The best approach seems to be in the way of Socratic reasoning to narrow down the show the distinction between hyphenated environmentalists (such as libertarian-environmentalists) and those who use the term without any modification.

The first thing to do is to ask what is an environmentalist, pointing out that by the basic meaning of the word it would indicate someone who wants a clean environment. Then point out the problem with that definition: it includes people who want one but not badly enough to do anything about it, and it includes people who want one but consider pollution the price to pay for progress.

That will get the unhyphenated environmentalist to agree that definition is too broad, and that it should be narrowed to "someone who wants a clean environment badly enough to do something about it."

This is where it gets tricky, and the critic of the unhyphenated environmentalist must stay on the offensive. The thing to do is to point out that according to most who use the term "environmentalist" as a self descriptor, libertarians are not considered to be environmentalists. Then challenge the statist environmentalist to deny that point.

If the statist environmentalist does deny that point, then the critic can call himself an environmentalist without fear of contradiction, and then put forward free market solutions to environmental problems as environmentalism.

More likely the statist environmentalist will not deny that point, meaning that the critic can now say "therefore the definition includes 'and advocates certain solutions' to environmental problems." That turns the definition into a political definition instead of concern about the environment itself. That is the definition that would be hotly denied without the Socratic lead in, and in order to prevent referring to free market environmentalists as environmentalists the statist environmentalist will have to agree.

A clear and concise definition is exactly what is needed to argue with statist environmentalists. The Socratic elimination is one of the most effective ways to achieve that definition.

Friday, July 08, 2011

California Shoots Self in Foot

Because California legislators are unable to control their urge to spend, especially their urge to spend on public employee pensions and salaries, they are always looking for new sources of revenue. There was one major stream of business not taxed, so the inevitable occurred. The government of the state of California decided to force businesses that do business over the internet to collect sales tax.

It is already law that residents of the state are supposed to pay the sales tax for all internet purchases. There is a line on the state income tax forms for that purpose - a line ignored by Californians. Frustrated by their inability to force Californians to pay yet another tax in one of the highest taxed states in the country, the idea was to “close a loophole” and force internet businesses to do the same tax collection that stores physically located in the state collect - a service they provide “free” to the state.

Already and are reacting to this new law. They are not collecting the sale taxes, though. They are pulling out of the state.

Both businesses have affiliate programs whereby people can sell their products through these major corporations. Both partners in the affiliate programs profit. The major corporations profit by getting a portion of the proceeds, and the small affiliates profit by having their products listed through major outlets where they can reach larger audiences.

These affiliate programs are all ended. The business connections have been severed. Amazon alone had 10,000 affiliates in California, and has ceased to do business with them unless they leave the state.

This law, instead of raising revenue, has created a revenue loss. Instead of increased sales tax, it has resulted in decreased income tax. It may have even resulted in increased unemployment compensation.

One would hope that the legislators and the governor would see the results and admit that a mistake has been made. One would hope that they would see the decreased revenue and the increased unemployment. Of course one would also hope that politicians are honest, capable, and intelligent, but the evidence indicates otherwise.

Friday, July 01, 2011

Judicial Reform in Defense

Since we have a government court system, one thing to do until liberty is achieved is try to make it function in a way that promotes actual justice. There are many ways in which the court system could be improved, some of them simple and some of them radical. One proposal is to hold judges accountable. Another would be allowing private citizens to file criminal charges. But there is one change that can be implemented right now, without any structural changes to the system. All it would require is a willingness to do the right thing. The part to change is the Public Defender's Office.

Currently, the Public Defender only defends the truly indigent. If someone cannot afford an attorney without going deeply into debt, but has an income above poverty, that person does not qualify for a public defender. Unlike civil suits where loser pays, a malicious prosecutor can financially break someone simply by filing spurious charges against them. The only reason that the Duke Rape Case turned out as well as it did was because the accused students came from wealthy families who were able to gather the resources to fight the charges.

The role of the Public Defender needs to be greatly expanded. Anyone accused of any crime should be entitled to representation by a Public Defender. A person still would have the right to hire additional representation, and would have the right to refuse a Public Defender, but the offer must be made. The problem with that is that the Public Defender’s office is already overwhelmed. Even with only defending the poor they have more cases than they can actually handle, and cannot devote enough time to mount a real defense of those they already represent.

The office itself should therefore be expanded. The Defender's office should have a budget equal to that of the District Attorney's office, and staffing levels of each office should vary by, at most, one person. Just as District Attorneys are promoted based on successful prosecutions, Public Defenders should be promoted based on successful defenses. Give full and equal resources and power to the two offices, to make one a real and actual check on the other.

If the average person is not equipped to face the full might of the government, unable to match the "unlimited" resources of the government, then the response should be to offer those same resources to the average person in defense as well as in prosecution.

The best part of this particular reform is it requires absolutely no structural changes to the justice system. It would not require any fundamental changes; it would not require amending any constitutions and it would barely require any changes to the law. All it would really take is the will to include it in the budget.