Tuesday, August 28, 2012

There Was No Moron Vote

"Just because you don't take an interest in politics doesn't mean politics won't take an interest in you."

Pericles (495-425 BC)

His name meant "surrounded by glory."  And he was.  Pericles was a very respected statesman, orator and general in ancient Athens.

Pericles was also a proponent of education and was such a proponent of and participant in Athenian democracy that he was pejoratively called a "populist."

Athenian democracy demanded that citizens participate.  And they did, in large percentages.  Even still, the percentage of the population that actually participated in politics and voted was about 20%.

But to be a citizen was the key.  Only males who had satisfied their military obligation could qualify.  One could only be a citizen if both his parents had been citizens.  Citizenship for any individual was determined by a vote of a quorum of 6000 other citizens who considered any male's qualifications.

If either parent was married to a foreigner citizenship was denied to the children. 

ONLY CITIZENS COULD VOTE.  And then only if there was no unsatisfied debt to the city of Athens.  Therefore, there were no voting rights.  The ability to vote was an appointment by the quorum!  So, the interest and participation by those so appointed to vote in the political arena was essential to Athenian society.  The voters actually determined the direction the gubment would take!

Hence the Periclean statement!  If you didn't want to participate, or vote, or know what you were voting for or against, the politics of the city would certainly act on you!  And you would be subjected to it.


Citizens who participated probably numbered in the hundreds, not the thousands.  Participants, then, knew what they were doing.  They knew the issues and heard debates.  They personally knew those running for office, or proposing certain laws.

There was no MORON VOTE!  Nobody voted based on 30 second sound bites, or ads that used false or incomplete information.  Nobody voted because of a debate where a "moderator" asked slanted questions designed to point a participant's answer in a certain direction to create unpopularity.  Illegal residents of the society could not vote.  Anyone without "skin in the game," to quote a phrase, could not vote.  Those who vote for shallow reasons like "great hair" or "being cute" were simply not in the voting population!

Those running for office had to portray their ideas to thinking people, educated people, participating people and people who loved their city and society.


If you wanted your city, and society, to go in a particular direction, you voted.  And Pericles, a popular statesman, wanted people to understand that.  He was free to announce his positions, and was unafraid to propose them!

PERICLES WANTED TO SWAY ADULTS TO HIS POSITIONS AND HAVE ADULTS VOTE FOR HIM.   He never heard the statement, "You are like our daddy and we are your children.  What will you do for us?"  PERICLES WOULDN'T KNOW HOW TO DEAL WITH THAT STATEMENT! 

How far do you think he would get trying to appeal to our voters today?

Tuesday, August 21, 2012

The Consumer Rules

"The best guarantee against all exploitation is the market."

Henri Lepage
French Economist

This is a simple statement.  It is also a bold statement.

Any time you use the word all, or never, you are probably in trouble.

But think about this.  ALL exploitation?

Exploitation is taking advantage of another in a more vulnerable state.  If someone is willing to do anything, or take any job, to make money, one would suspect that exploitation could be the natural result.  

Vulnerabilities make it possible that exploitation can happen between individuals, businesses and even markets.

Can people take advantage of others really?  When freedom exists exchange is voluntary.  People deal one with another through mutual benefit.  If something is taken involuntarily the law would rectify that.  Free market capitalism depends on the rule of law.

Can an employer take advantage really?  Doesn't an employer have to pay a competitive wage or salary?  Would not competition in a free enterprise market require competition?  Can an employer force employment at a lower wage?

Can a market take advantage really?  Exchange in a free enterprise market is voluntary.  Business to business, person to person - it is all voluntary.  Exchange is freely done because both parties perceive benefit.  "The market" cannot take advantage of anyone operating voluntarily.

How is free market capitalism not exploitative?  How does it guarantee against exploitation?

When property (any property, including money) is acquired through honest and peaceful effort, the property owner is free to sell it, give it away, trade it, leverage it - whatever!  All that is voluntary.  By definition this is free, and such freedom certainly trumps exploitation.

But let's look further:
  • No other economic system, besides free market capitalism, has done so much to lift entire societies toward better standards of living and more prosperity.  Ludwig von Mises said that in such a system entrepreneurs are only benefitted to the degree that they supply the wants and needs of the consumer.  So who benefits the most?  THE CONSUMER!
  • Monopoly cannot exist in free market capitalism.  Why?  Because power cannot be concentrated as the consumer is benefitted.  Power is therefore quite decentralized over the broadest spectrum of society - the consumer with money and the consumer without so much money.  All are benefitted with something.  If there was no discretionary income so many junk products would never see the light of day!  So who benefits the most?  THE CONSUMER!
  • In free market capitalism the consumer is always looking to take advantage of what the market provides.  The consumer participates to the point they can - they can shop at a second-hand store or at an expensive one.  The consumer drives the market - the market does NOT take advantage of the consumer.  So who benefits the most?  THE CONSUMER!
  • Free market capitalism is indiscriminate.  It feeds the good and the bad of society.  The people choose!  As more choice becomes available, and varying products are produced and distributed, people pick and choose according to their desires.  When prosperity reigns the consumer acquires, even what it might not need, and become more obese in more ways than one.  The objective of free market capitalism is not to restrict, but provide.  So who benefits the most?  THE CONSUMER!
All the talk about "leveling the playing field," or "taking care of the least able," is just that - talk.  Left alone, in a free market, free enterprise system, the power of the consumer is the greatest force in leveling and taking care. 

Disrupting market forces to artificially apply this or that outside force to make things more "fair" creates inefficiencies, reduces motivation, stultifies growth, creates waste and THE CONSUMER benefits the least.


Tuesday, August 14, 2012

In Spite Of Gubment

"Things in our country run in spite of government, not by aid of it."

Will Rogers (1879 - 1935)

A man of many hats, Will Rogers was best known for his humorous, and sometimes caustic, quips and one liners.

He did a little bit of everything, giving him a broad experience and circumspect view of life.  From being a gaucho, to Vaudevillian, movie actor and radio broadcaster, and more, for decades he entertained with his personality and style.

Never one to back away from a controversial statement, even though he backed FDR and the New Deal (which was really Hoover's old deal wrapped up in more money), Rogers was not shy.

"Be thankful we're not getting all the government we're paying for."
"Lord, the money we do spend on government and it's not one bit better than the government we got for one-third the money twenty years ago."

Humor is best when it contains truth.  Do things really run in spite of gubment?

Certainly those statments all contain truth! 

Is a degree of gubment regulation necessary?  Sure, but what kind and how much before it becomes so expensive it ends up stultifying motivation and/or economic activity?

The Competitive Enterprise Institute has a report called "The Tip of The Costberg," in which they calculate that $1.086 trillion of the $3.6 trillion budget was spent on the cost of compliance of federal-agency written regulation in JUST THE FIRST HALF OF THIS FISCAL YEAR!  So, in their calculations, the cost to our economy in just regulatory compliance equals the federal budget.


The hallmark, the defining criterion of bureaucracy, is that it has to grow to sustain itself.  It becomes further and further compartmentalized, with each office, and officer, growing in "importance" and overseeing control.

Are we not now, once again, at the point made by Mr. Jefferson in the Declaration of Independence when he wrote, as one of the many complaints to a tyrannical king:  "He has erected a multitude of new offices, and sent hither swarms of officers to harass our people and eat out their substance..." ?

No matter who the next president is, he will inherit a real mess.  Some would say an intentional mess.

And eliminating a huge portion of regulation demanding expensive compliance has to be eliminated or we will drown not only in debt, which "financial cliff" appears certain to come, but in compliance to silly, self-important and bloated offices and officers IN TRIPLICATE!

Tuesday, August 7, 2012

Shortage Of Sand

"If you put the federal government in charge of the Sahara Desert, in five years there'd be a shortage of sand."

Milton Friedman (1912 - 2006)

In honor of "Uncle Miltie's" 100th birthday, we salute him by using one of his most sarcastic quotes!

But, what do YOU think?  Is it true?

Is there much "taken over" by the bureaucrats that is not later unrecognizable?

Would not the Sahara Desert "taken over" by the bureaucrats not later be unrecognizable?

What causes shortages?  It is simple supply and demand.

When demand exceeds supply there are shortages.  Certainly.  So how do we get there?


Easy peasy.  Does gubment do that?

Take an easy example (and there are many to choose from!) - rent control.

Note:  for the word rent, we could easily substitute other words - price, licensing, inventory, production, subsidy, you name it.  We could also substitute goods or services - corn production, oil production, drug approval and/or distribution, mortgages, auto production, student loans, a whole host of other things influenced, and, soon to come, health care!

So, back to rent control.  To help the "needy," rents are artificially capped with artificial ceilings with pricing that is artificially low that are passed with artificial loopholes from a renter to a friend with artificial "needs" making such units artificially popular, but necessarily artificially few.

Why are fewer available?  Because their owners cannot, or do not want to, rent them at such artificially-low prices.  And they sit, UNRENTED.  Or the owners live in them.

What does this crop of artificially low-priced, and therefore fallow, units do to the rest of the market?  Fewer units available on the market boosts the price of the rest of the market!  Artificially.

Where the market would comfortably find and rest on a proper distribution of supply and demand (i.e. numbers of units available at market prices), instead we have market skews in every regard! 

Add to that apartments that are being purchased by the super rich for sport, trophies, dorms for college kids and so forth, and, well, you have further skews!


Meanwhile, the "average person" has a hard time finding a place to live that is affordable or large enough to house more than a family of guinea pigs.

Such fun and games foisted upon the Sahara Desert would likely, in Dr. Friedman's view, skew its resources beyond belief and create a shortage of sand!

We salute Milton Friedman for his forthrightness, common sense, and ability to speak clearly and forcefully as a true TEACHER in free market economics!  FREE ENTERPRISE!

Thank goodness there is a healthy supply of students of his, free-market economists, coming along now!

Saturday, August 4, 2012

Appreciation For Work

My daughter is a hostess (among the other jobs she does) at this Chick Fil-A.

Her boss, "Mr. Mike," hired her to help him create RAVING FANS.  He does not want patrons, he wants raving fans to come back and come back and come back.

The other day was Chick Fil-A Appreciation Day.  My daughter was scheduled to work.  The previous evening they called her to work a couple more hours than usual.  She agreed.

Before the store opened for breakfast the line was crazy!  They ran out of breakfast stuff around 10am (and they had more breakfast food stocked up than normal).

Going in just after breakfast ended, my daughter had the time of her life.

Because of her personality she was asked to hostess.  It would not be easy.  The place was PACKED, inside and out.
She worked very hard.
She was such a fine hostess people actually gave her tips!
She knew dozens of the people who came in.
She had invited friends and many, many showed up.
She saw families come in for lunch, and then, later, again for dinner.
She had her picture taken with many patrons.
She did things for people they did not expect she would do.
She could not believe how many people showed up.
She has a better understanding of how the market can overcome political funny business by people who don't think that she, or what she does, represents "American values."
She learned what it takes to be a producer.
She said she has no idea why somebody would not want to work for a living.
She had a very good time!
She made huge dollars!  (it's all relative...)
She came home, after they literally had to throw people out of the store, very tired!
She came home VERY SATISFIED.
She may not have been as happy as our dog, Jenny, who is happiest when the entire pack is together.
She went right to bed.

A few days ago she texted me from work asking to "plz, plz, plz" buy tickets and take her to the Batman movie at midnight that night.  That was at 930pm or so.  I was still working on inspection reports!  I did not finish work until 1045 that evening, after 15 1/2 hours of work that day.  She made arrangements to meet a group of friends there too!

So, being the easy blob to manipulate that I am, we went.  We did not get home until 330am.  I had my first inspection the next day at 8am.

Did she care?  Well, no.  She wanted to see Batman and could sleep in!

Last night I asked her if she would go with me to a midnight movie.  "OK!  Wait, I have to work tomorrow!"

We didn't go.

I think Chick Fil-A Appreciation Day gave her a new appreciation for many things.