Current Events

Another Housing Bubble?

Warren Gibson Current Events, Economics, Liberty , , , , ,

Last year I wandered down the street to an open house for sale. Even though I announced myself as a looky-loo, the agent welcomed me. We sat around talking and eating cookies for an hour; no prospects showed up.

It was a nice day today and I decided to walk to another open house thinking I’d again look around and chat with the agent. Hardly – the place was mobbed! It looks great in this picture but the reality is it’s stuck way up on a hill with a steep driveway and no garage. It’s 80 years old and although it’s been fixed up cosmetically it’s nothing to write home about; not in my book anyway. Nevertheless, I’m betting they’ll have multiple offers before this first day on the market is over.

This is the San Francisco Peninsula which is by no means representative of the whole country but I hear that Las Vegas has turned around too, as have tony places in New York. Why? Although I can’t prove it, I believe a good part the gusher of money that the Fed has been printing is now making its way into housing. The stock market has stalled, the bond market is in retreat, gold has plummeted, and that pretty much leaves housing.

So although the basic premise of monetary stimulus is plausible, it just doesn’t work. The new money seems to go careening around the economy in search of the Next Big Thing. Bubbles form and collapse, malinvestments are revealed and the cycle starts anew. What’s different this time is that it’s been such a short time since the collapse of the previous housing bubble to what looks like the start of another.

If these wasteful cycles of boom and bust are to end, the Fed must cease its stimulus programs. But it can’t. When the Fed dropped just a hint last week that it might start “tapering” off its bond-buying (money-printing) program, the bond market panicked. Why should we care about the bond market? For one thing, the average maturity of the federal debt is just a couple of years. Maturing debt must be rolled over into new debt, and if the new debt carries higher interest rate, the total annual interest payment could quickly swell from a “mere” $345 billion for the current fiscal year toward a trillion dollars per year, swamping any efforts to contain spending, like the $80 billion sequester that just took effect. We could end up needing a bailout from China.

The Fed will very likely continue or even accelerate its bond buying, depending on who occupies Bernanke’s seat come January. We should expect continuing cycles of bubbles and busts and the real possibility of some very nasty fiscal consequences.

From the Comments: Open Borders, Immigration and the Sociology of Gradualism

Brandon Christensen Comments, Current Events , , , , , , , , , ,

Dr Delacroix takes issue with my woefully inadequate summary of his work on open borders in the Independent Review. He writes:

Small yet somewhat important correction: In our piece in the Independent Review, Nikiforov and I argue for somewhat more than a guest worker program and our reference is not a to a EU “guest worker program.” (I am not sure whether there is one.) Rather, we argue that little harm would be done and, as we see now, much harm avoided, by simply agreeing that citizens of Canada, the US and Mexico (especially Mexico) can freely move across the common borders of the three countries. including for the long term. What we have seen in the EU for now more than twenty years shows that there is no reason to attach this free movement principle to citizenship.

That you may work, open a business, pay taxes in Mexico does not logically imply that you may vote in Mexican elections. That you may not does not deprive you of any “rights.” As an immigrant into Mexico you knew what you were doing. You moved under your own power. It’s unlikely anyone even invited you. If you crashed the party, you have no moral right to complain that the food is not kosher (or hallal, you decide).

Several years later, I think that the only reason for this insistence on tying residence to citizenship is the Democratic Party’s totalitarian aspirations. Observing the drift in the Obama administration toward non-legality clarified the picture for me, personally. (I am not speaking for my co-author, here. He just spent three years in Russia; I will ask him.)

Historical precedents matter, and a preference for gradualism may make it desirable -in this country- to transition through a somewhat familiar “guest worker program” rather than directly decree open borders for the citizens of the three NAFTA countries.

I am for whatever works but we must keep concepts distinct from each other: A tomato is not really a fruit, not really.

PS I am glad Notes On Liberty publishes my essays (and even my stories) and that it links to my blog. When I grow up, I want a readership like Notes’ readership!

No Capitalism Means No Peace: Egypt Edition

Brandon Christensen Current Events , , , , , , , ,

I just briefly touched on this in an earlier post, but I thought I’d bring in another perspective to shore up my argument. Fraser Nelson, writing in the UK’s Telegraph, explains some of the important differences between freedom and democracy:

While the West was celebrating Egypt joining the comity of democratic nations, Egyptians themselves were sliding into an economic abyss, with terrifying shortages of fuel, food and security. Sectarian violence has been thrown into the mix, with persecution of the Coptic Christians followed by Sunni v Shia strife. The murder rate trebled. Things were falling apart, which is why the generals were welcomed back.

But the Arab Spring was a demand for freedom, not necessarily democracy – and the distinction between the two is crucial. Take, for example, the case of Mohammed Bouazizi, who started this chain of events by burning himself alive on a Tunisian street market two years ago. As his family attest, he had no interest in politics. The freedom he wanted was the right to buy and sell, and to build his business without having to pay bribes to the police or fear having his goods confiscated at random. If he was a martyr to anything, it was to capitalism […]

The narrative of a 1989-style revolution in hope of regime change seemed so compelling to foreigners that there was little appetite for further explanation. But […] this was a protest for the basic freedom to own and acquire ras el mel, or capital.

Read the rest. I think it is pertinent to note that liberalism (the institutional face of capitalism) was murdered by British imperialism in its infancy (“Egyptian freedom means no more British imperialism, therefore…”).

The people of the Middle East will not get out of the rut they are in until there is a revolution of ideas in their societies. The demand for liberal ideas is certainly there, but Western imperialism provides a convenient scapegoat for authoritarians in the region. Western imperialism is different from Russian, or Persian, or Turkish, imperialism because the Arab public holds the West to a higher standard than other states. It’s time we started doing the same: remove all troops and military equipment owned and operated by the United States from the region.

This will lead to the rapid disappearance of the Islamist monarchies our government protects, and will open up the region to important dialogue. As long as the US military remains in the region, though, the Middle East will not taste freedom. Imperialism is antithetical to freedom, as both the society funding imperial projects and the society being forced to receive imperial projects are coerced in the name of central planning.

See also “Moral Markets and Immoral ‘Capitalism’” and “The Hidden Vice of Capitalism” for more in-depth arguments about the term “capitalism” and what it actually means.

The Immigration “Reform” Bill: RINOs, Labor Unions and a Libertarian Alternative

Brandon Christensen Current Events, Links, Politics , , , , , , , ,

Nobody is happy with the current immigration reform package being shoved through Congress at the moment. I don’t know too much about the specifics of the bill, or even about immigration itself (except that immigrants make good drinking buddies), so I’ll just outsource some ideas and arguments I’ve read elsewhere. First up is our very own Jacques Delacroix, an immigrant from France, who writes:

The main objective of the bill is to install in this country an unbeatable Democratic majority for the foreseeable future. The intent is to turn this polity into a one-party system. Everyone assumes, of course, that the electoral benefits of the bill will redound to the Democratic Party. If you don’t believe it, conduct a simple mental experiment: Tell yourself under what circumstances the implementation of the present bill, or of one similar to it, would cause a net increase in the number of Republican voters?

At best, at the very best, the admission of ten million formerly illegal immigrants and of their dependents would have no effect on American electoral politics. There is no scenario whereas it would help the conservative cause.

New immigrants vote Democrat. Immigrants from societies with authoritarian traditions vote Left unless their societies have gone through violent purging convulsions such as happened in “communist” Eastern Europe in the nineties. The idea that the government should leave people alone is a sophisticated one. It does not grow naturally out of the experience of oppression.

Indeed. Is this analysis wrong? If so, feel free to elaborate why you think so in the ‘comments’ section. I highly recommend reading the whole thing. Angelo Codevilla, an immigrant from Italy (and one of Dr Delacroix’s fellow academics), also elaborates on the bill:

Beginning in the 1960s, increasingly dandified native youths shunned agricultural and service jobs. So did the new legal immigrants. This made room for a growing number of laborers from Mexico who came and went freely and seasonally across a basically un-patrolled 2000 mile border. These were not “immigrants,” but rather mostly young men who yearned to get back to their families. They did not come to stay, much less take part in American politics. America came to rely on them to the point that, were a magic wand to eliminate them, whole industries would stop, including California agriculture.

US labor unions however, supported by the Democratic Party, pressed the US government to restrict this illegal flow. While until the 1980s, the US-Mexican border was patrolled by fewer than 1000 agents – nearly all at a handful of crossing points – that number has grown to some 25,000 in our time. As the border began to tighten, making it impossible for the Mexicans to come and go, many brought their families and stayed put in the US between work seasons […]

The controversy over illegal immigration did not touch the core of the immigration problem, namely the Immigration Act of 1965 and our burgeoning welfare system. Nor did it deal with the fact that the illegal flow of Mexicans was really about labor, not immigration, because most Mexican “illegals” had not come with the intention of staying. A well-crafted guest-worker program would give most of them what they want most [emphasis mine – bc].

Hence the “illegal immigration problem” is an artifact of the US political system: The Democratic Party wants the Mexicans as voters, the labor unions want the Mexicans as members rather than as competitors, and the Chamber of Commerce wants them for as low a wage as it can enforce.

Codevilla has much, much more here. Codevilla attributes the US immigration system to the corporate state, but I am unsure if Dr Delacroix feels the same way.

Delacroix’s piece, like Codevilla’s, also brings attention to an alternative guest worker program. Delacroix, in an article for the Independent Review, points out that the guest worker program has worked extremely well in the pre-central bank European Union (I am unsure if this is still the case).

A guest worker program would eliminate the political implications associated with “illegal immigration reform” and, as a result, enhance the economic benefits of seasonal labor flows coming from Mexico. The Cato Institute has recently come out with a policy report detailing how a guest worker program might be implemented. As I’ve stated before, the Cato Institute is one of three think tanks I actually trust (the other two being Brookings and Hoover).

Life Unplugged

Brandon Christensen Books, Current Events , ,

Hey all,

I’ve been enjoying LA. I finished up 1493 about a week ago and can’t recommend it enough.

Chapters 8 and 9 – on the impact that Africans and Asians had on the New World – are especially fascinating . Mann essentially destroys every myth about race that has ever been devised, but does so in a way that is not condescending (Politically Correct) and not reactionary.

I’ve since been slowly working through Mastering Space, but it’s a real daisy and I think the only people who take it seriously are Marxist-oriented geographers and anthropologists.

I picked up a couple more books with graduation money (Norman Davies’s Vanished Kingdoms, Edwin Wilmsen’s Land Filled with Flies and Bernard Lewis’s Islam and the West), but most of my time will be spent going through Volume 2 of Armen Alchian’s collected works (the volume on property rights and economic behavior), finishing up Said’s Orientalism (again) and studying for the GRE.

The coup in Egypt was predictable. Imperial Britain essentially strangled liberalism in Egypt just after its birth. What we have in Egypt is a large society with no political alternatives: either you can pick the Islamists (and Islamism has nothing to do with Islam, of course) or you can pick the national socialists (i.e. the fascists). Without a regime based on private property rights, individualism and free trade, Egypt will never know tolerance, prosperity or liberty. Democracy by itself can do nothing for Egyptians.

Around the Web

Brandon Christensen Current Events, Links , , , , , , , , ,
  1. The Reality of Feel-Good Government. James Bovard on “federal service” programs
  2. Will Wilkinson says “I smoke pot and I like it” (there’s more to the piece than just a confession)
  3. Map of police officers per 100,000 people in Europe
  4. Filming North Korea’s Film Industry
  5. Stephen Walt weighs in on the Snowden affair: What, me worry?
  6. Sex in the Arab World. An interview with Shereen El Feki

Internal Revenue Service Even Handed After All

Jacques Delacroix Current Events, Politics , , , , , ,

Liberal commentators in all media and even on this blog have been eager to announce that the IRS was an equal opportunity offender between Left and Conservative groups and that, therefore, there is not much of a (new) scandal attached to the IRS.

Peggy Noonan resets the clock in her column of Wall Street Journal of 6/29/13. (All boldings below come from me.)

According to a House Ways and Means Committee source , only seven (7) cases of the 298 cases flagged by the IRS for extra scrutiny appear to represent progressive causes. Not one of the seven was subjected to harassment and abuse. Of the seven, only two were sent follow-up questionnaires after their application for tax-exempt status was received […] And all seven saw their applications approved […]

The “source” was not identified by name. Want to bet it does not exist?

[…] Russel George, the Treasury Inspector General whose audit broke open the scandal answered Rep. Sander Levin’s charge that the audit had ignored the targeting of progressives (by the IRS, bolding and comment mine) […]

The evidence showed conservative groups were singled out by the IRS, not liberal groups. While some progressive groups may have ended up on a BOLO list, the IRS did not target them. We did not find evidence that the criteria you (Rep. Levin), labeled “Progressive” were used by the IRS to select potential political cases during the 2010 to 2013 time frame we audited. One hundred per cent of the groups with “Tea Party,” “Patriot,” or “9/12″ in their names were given extra scrutiny.

Soon, very soon, the Internal Revenue Service will withdraw its apology for misdeeds it gave about two weeks ago precisely for persecuting, treating unfairly conservative-sounding groups. Right?

I wish the liberal deniers on this matter were cunning and twisted rather than something else. It’s easier to deal with conscious dishonesty than with the alternative. Many 1932 Germans were also not twisted, not consciously dishonest; they just would not see the evidence of their eyes.

Edward Snowden is a Commie

Brandon Christensen Current Events, Liberty , , , , , , , ,

So says Max Boot at Commentary, a neoconservative publication that specializes in lies and slander to further the imperialist cause (there is, if you think about it, no other way to further a cause such as theirs). No, really, read it yourself.

Boot tries to pretend that the NSA was only spying on citizens of foreign states, rather than on Americans, but this is laughable on its face, especially given the recent IRS scandal (where an august body of bureaucrats charged with collecting taxes suddenly finds itself targeting conservative political groups during a close presidential election season).

I’ve read elsewhere that Snowden was inspired by Ron Paul. If this is true, then Ron Paul is even more of a bad ass than I thought. The only people on my campus who do not like Ron Paul are hardline Democrats and hardline Republicans. But just think: very few young people identify with a specific political party. The reasons for this vary, but for the most part young people are much more independent thinkers and have yet to enter the workforce. Once they enter the workforce, of course, they will begin to vote for a party line, but kids in college who already identify with a political party tend to constitute tomorrow’s fascists: they are condescending, gullible and believe that the political system is the best way to change society for the better.

American imperialism is dead. Once the Obama administration begins arming al-Qaeda, and the media begins to really throw Obama under the bus, the idea that US government can magically make the world a better place by bombing, arming and invading other countries will find its rightful place in the dunce’s corner of American politics once again. In the mean time, we need more heroes like Snowden to expose the horrific abuses of liberty that Washington has been pursuing under the guise of wars on terror, drugs and poverty over the last half century.

The Decline of the State?

Brandon Christensen Current Events, Links , , , ,

From the Atlantic:

Health care for the world’s poorest and human rights for the oppressed as private-sector businesses? Where there’s money to be made, a commercial alternative will emerge. But core state enterprises are subject to increasing non-commercial competition, as well. Many in southern Lebanon willingly receive social services and other incidents of modern government from the terrorist group Hezbollah rather than from the official government. Al-Qaeda presents many Islamic radicals with an even more extreme — and arguably more effective — non-territorial alternative to the nation-state for purposes of waging war.

The whole thing is interesting throughout, though I don’t agree with the author that virtual states are somehow replacing traditional states. I don’t think we’ll see the disappearance of the state anytime soon either. What will happen, I think, is that governments will become more minarchist in nature as markets simply overwhelm the crummy services that governments essentially force on people using their own extracted money.

Around the Web

Brandon Christensen Current Events, Links , , , , , , , , , , , , ,

I apologize for the dearth of posts lately. I have been reading a lot of books the old-fashioned way, chasing girls down so that I can  smell their hair and generally just enjoying life post-graduation.

  1. Will Wilkinson blogs about the drug war’s inherent racism at Democracy in America.
  2. Rebecca Liao writes about Democracy in China for Dissent.
  3. Randy Barnett on the future of federalism after the “gay marriage” SCOTUS decision.
  4. Uganda versus South Korea. An interesting take on development by Andrew Mwenda.
  5. The Economist has a great piece on the violence in Turkey.
  6. Fascinating ‘comments’ thread on Hayek and Pinochet. I am going to dedicate a long piece to this thread shortly. American Leftists are just classical liberals who have come to think of themselves as superior to their neighbors. Leftists in Europe and Latin America are murderous.

Leon Hadar on Obama’s Syria Decision

Brandon Christensen Current Events, Links , , ,

President Obama, unlike his predecessor, is not promoting democracy in Syria. He is instead pretending to play the game of power balancing, hoping that neither side in the war there wins, and instead allowing both to lose.

Read the whole thing. There is not much new information in the piece, but then again hawks in the US have known about the situation in Middle East for decades and have still advocated stupid policies. Nevertheless, Hadar’s account contains some brilliant rhetoric that I think may be of use to readers and writers that fight for liberty.

Buddhist Leaders Call on Myanmar to Expel Muslims

Brandon Christensen Current Events, Religion , , , , ,

From the New York Times:

After a ritual prayer atoning for past sins, Ashin Wirathu, a Buddhist monk with a rock-star following in Myanmar, sat before an overflowing crowd of thousands of devotees and launched into a rant against what he called “the enemy” — the country’s Muslim minority.

“You can be full of kindness and love, but you cannot sleep next to a mad dog,” Ashin Wirathu said, referring to Muslims.

There is much more in the piece, including this:

[…] images of rampaging Burmese Buddhists carrying swords and the vituperative sermons of monks like Ashin Wirathu have underlined the rise of extreme Buddhism in Myanmar — and revealed a darker side of the country’s greater freedoms after decades of military rule. Buddhist lynch mobs have killed more than 200 Muslims and forced more than 150,000 people, mostly Muslims, from their homes.

Ashin Wirathu denies any role in the riots. But his critics say that at the very least his anti-Muslim preaching is helping to inspire the violence.

What began last year on the fringes of Burmese society has grown into a nationwide movement whose agenda now includes boycotts of Muslim-made goods. Its message is spreading through regular sermons across the country that draw thousands of people and through widely distributed DVDs of those talks. Buddhist monasteries associated with the movement are also opening community centers and a Sunday school program for 60,000 Buddhist children nationwide.

This bad news is, of course, contradictory to everything Dr Delacroix and other imperialists have written on the subject of religious extremism. Imperialists in this century like to pretend that Islam has suddenly appeared to take the place of communism as the preeminent threat to peace and prosperity in the world. They point to violence, poverty and state-sponsored oppression as examples of Islam’s inherent incompatibility with the liberal world order.

This is all anecdotal evidence. There is nothing inherently violent about Islam. All religions are equally authoritarian at their core.

I pull two things from this piece: 1) it reaffirms my commitment to secular government and 2) it reconfirms my skepticism of democracy. These two things go hand-in-hand, of course.

A government that decides to adhere to one religion is necessarily going to oppress those it does not sponsor. This is easy enough for our Western readers to understand, but it is an argument that does not have nearly enough clout in the non-Western world (you could perhaps exclude China from this list, and India has essentially been Westernized; New Delhi even has its own condescending policy towards its indigenous minorities).

The democratic aspect, too, should be familiar to Western readers. Democracy needs restraints, and lots of them. The reasons for this are practically infinite, but suffice it to say here going to war in the name of democracy is a foolish, morally horrendous thing to do. The fact that imperialists today often shroud their lust for power in terms of democracy speaks volumes about the immoral nature of their worldview. (h/t Eugene Volokh)

Про пиратство, русский менталитет и национальное самосознание

Evgenii Grigorev Current Events ,

Всем привет!

Давно ничего не писал. Лето, все дела, времени мало. Но получив вчера магический подзатыльник от Brandon Christensen (специально написал имя по-английски, чтобы переводчик случайно не перевел его неправильно), решил активизировать свою деятельность на Notes On Liberty и поделиться с вами несколькими резонансными событиями, произошедшими в России за последнее время.

Ситуация с Сирией несколько отъехала на второй план после того, как Государственная Дума приняла два очень важных для каждого русского человека закона, касающихся пиратства в Интернете. В силу менталитета и самосознания, практически каждый русский стремится получить некоторое “благо”, ничего не отдав в замен. Это касается музыки, фильмов, сериалов, каких-то нематериальных благ, будь то скидки в магазины, всякие бонусы. В принципе такую позицию можно понять: каждый человек стремится получить побольше всего, и отдать поменьше. При этом вопрос чужой выгоды вообще никого не заботит. “Я хочу слушать новый альбом любимой группы в Интернете в плохом качестве за две недели до его официального издания, чтобы потом не тратить деньги на его приобретение”. Или, например, “я хочу смотреть новинки кинематографа дома, и не покупать для этого диски в магазинах”.

Законы, которые у нас приняли, напрямую касаются интернет-пиратства. В сети началось активное удаление пиратской продукции по требованиям правообладателей: удаляется популярная музыка, попавшая в сеть незаконно, фильмы, сериалы и прочее. Я считаю, что это правильно. Нужно уважать чужой труд. Если музыкальная группа выпустила альбом – его нужно купить, а не украсть. Группа потратила силы, время и деньги на запись музыки, мастеринг, сведение, издание альбома. Организовала тур по странам. Так почеу бы не заплатить им 10 долларов за альбом? Самое интересное, что подобный вид интернет воровства российскими гражданами не считается “нарушением закона”, так как каждый глубоко верит в собственную исключительность, анонимность и непричастность.

Я знаю, что во многих странах мира вопрос с пиратством если не решен полностью – то по крайней мере находится в стадии решения. Надеюсь, что и Россия когда-нибудь по уровню культуры и самосознания сможет догнать иностранных коллег.

The Real IRS Problem

Warren Gibson Current Events, Liberty , , , ,

It’s heartening to see distrust and resentment of the IRS building up in the wake of the targeting of tea party groups and such. But let’s not overlook the daily predations of the IRS, small and large, which add up to a mountain of costs borne by citizens – not just monetary costs but also mental anguish and occasionally violent confrontations.

Case in point: your humble servant. This morning I received a notice demanding $8,900 in back taxes. Needless to say that ruined my day even though it took me only five minutes to realize that they made a mistake and I owe them nothing. I have high hopes that this will be resolved quickly but you never know. I mentioned my plight to a friend this morning and he chuckled. He once had a $1,400 claim which he fought for ten years until finally he got to the right person at the IRS who found their mistake in five minutes. Did he get an apology? Restitution or compensation of any kind? Of course not.

The complexity of the tax code is often cited as a significant drag on the economy, in terms of time spent gathering information and preparing returns, money paid to tax preparers and tax attorneys, etc.  But there are lots of other bad effects.  No one understands the tax code in its entirety and most IRS agents understand little of it — or worse, what they often think they understand is wrong.  Nor do taxpayers understand it.  This opens the door for errors, misunderstanding, cheating and consequent confrontations, anguish, time and money wasted, and sometimes violence.

If we have to have an income tax (which I’m unwilling to concede), let’s have a simple flat tax and do away with, if not the inherent coercion of any tax, at least the enormous expense and anguish that are part and parcel of the current insane system.

What I’ve Been Reading

Brandon Christensen Books, Current Events, History , , , , , , , ,

Hello all. Apologies in advance for not posting more often since graduation. I’ve been reading a lot of books lately, rather than stuff on the internet, so I haven’t had much to link to lately.

Here is a list of a few books I have been working on:

  • 1493: Uncovering the New World Columbus Created by the science journalist Charles C Mann. I know I’ve blogged about this book before, but I’ve finally got a little bit of free time to hunker down and read the whole thing. I’m about halfway through and it’s really good.
  • Mastering Space: Hegemony, Territory and International Political Economy by the Marxist political geographers John Agnew and Stuart Corbridge. This is a pretty crummy book, but it was recommended because of some good critiques of the IMF and the World Bank that it supposedly has. I’ll keep ploughing through and hope for the best.
  • The Embarrassment of Riches: An Interpretation of Dutch Culture in the Golden Age by the historian Simon Schama. This is a very well-written book about Dutch culture (not Culture) in the seventeenth century and so far I have not been disappointed. Schama eschews the political and economic aspects of the Dutch republic in favor of examining the everyday lives of its citizens.
  • Democracy in Botswana which is edited by John D Holm and Patrick Molutsi. I picked this up for a research project I was doing last quarter and have not been able to let it go yet. It brings together a compendium of talks given at a conference held in Gaborone in 1989 to assess Botswana’s current status in the world, in sub-Saharan Africa and according to the citizens of Botswana.

Of the four books, I’d recommend 1493 to the intelligent layman, but the other three are definitely tough slogging.