property rights

Life Under Fatwa

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

I did once visit Iran when I was 21 years old, during the time of the shah. It was wonderful. I had just graduated from university, and such was the world at that time, 1968, that I was able to drive with a friend from London to South Asia across the world. I mean, try driving across Iran and Afghanistan now! I remember it being a very cosmopolitan, very cultured society. And it always seemed to me that the arrival of Islamic radicalism in that country, of all countries, was particularly tragic because it was so sophisticated a culture — which is not to defend the shah’s regime, which was appalling. But it was one of the tragedies of history that an appalling regime was replaced by a worse one.

From Salman Rushdie.

At first I found his praise for the Obama administration to be typical of Left-wing establishment figures, but then I remembered that Rushdie is an Indian and had probably had to deal with racist legislation in one form or another while growing up. While the period of colonialism (roughly coinciding with the end of the Napoleonic Wars and the beginning of World War I) did indeed open up more places to markets, the Jim Crow-like legal barriers that European states erected no doubt helped to foster part of the suspicious climate that now pervades most globalization skeptics worldwide.

This is a shame for two reasons: Continue reading →

Around the Web: Consortium Edition

Brandon Christensen Links , , , , , , , , , , , , ,

Co-editor Fred Foldvary points out that slavery is alive and well today.

Historian Michael Adamson compares the debacle in Iraq to South Vietnam rather than Germany or Japan.

Mark Brady gives us a well-written, brief biography of a little-known (and hence important) individual in the liberty movement.

Ninos Malek explains how property rights are the key to environmental conservation efforts.

Jeffrey Rogers Hummel takes on anthropologist David Graeber.

More on Chick-fil-A

Warren Gibson Liberty , , , , , , ,

Here’s a commentator in the New York Times who echoes my views on the Chick-fil-A matter, and in a more gracious manner:

… a society that truly believes in individual freedom will respect Mr. Cathy’s right to his views. Those who disagree with him are free to boycott Chick-fil-A in protest. But if our elected officials run Chick-fil-A out of town, they are effectively voting for all of us, regardless of our respective beliefs, and eliminating our individual freedoms.

The writer is Steve Salbu, dean of the Scheller College of Business at the Georgia Institute of Technology.  And he happens to be a gay man.  Here is the link.  Not sure if it’s gated.

Chicken Fascism

Warren Gibson Culture, Current Events, Law, Liberty, Politics , , , , ,

If anyone hadn’t yet gotten the message, the flap over Chick-fil-A ought to make it crystal clear that contemporary “progressives” are fascists, plain and simple.

The issue, of course, is the CEO’s statement in opposition to gay marriage, which has prompted a backlash across the country.  San Francisco’s mayor tweeted “Very disappointed #ChickFilA doesn’t share San Francisco’s values & strong commitment to equality for everyone” followed by “Closest #ChickFilA to San Francisco is 40 miles away & I strongly recommend that they not try to come any closer.”

Wow. It wouldn’t be much of a stretch to substitute “Closest Jews are 40 miles away and I strongly recommend they not try to come any closer.”  Mayor Lee would have fit right into 1930’s Nazi Germany.

The proper response to those who take offense at the CEO’s statement is a boycott, which just might work if Chick-fil-A were to set up shop in San Francisco.  It’s a totally different story when a mayor, backed by the armed might of the police, issues veiled threats against people who hold unpopular views.  This is a huge demonstration of our descent into fascism, right in front of our eyes.

By the way, do I recall correctly that the majority of California voters in 2008 approved Proposition 8 which banned gay marriage?

 

An Ominous Expansion of Eminent Domain

Warren Gibson Liberty , , , , , , ,

A new assault on private property is in the works and it hasn’t gotten much attention – yet.  Needless to say, it goes by an Orwellian name, in this case the “Homeownership Protection Act.”  As summarized recently by Kathleen Pender in the San Francisco Chronicle, the scheme has been hatched by two cities in San Bernardino County and has not taken effect yet but is under serious consideration.  A new agency called a “Joint Powers Agreement” would be formed to do the dirty work.

The idea is to use the power of eminent domain to seize mortgages – not houses but mortgages owed to lenders by homeowners who have defaulted or are under water.  Using Ms. Pender’s example, suppose there is a $300,000 mortgage on a house worth $200,000.  The agency decides the mortgage balance should be $190,000 which would leave the homeowner with $10,000 in equity.  It seizes the mortgage and compensates the mortgage holder in an amount such as $170,000.  A new mortgage in the amount of $190,000 is then issued by a private firm which would reimburse the agency some lesser amount, say $180,000.  Thus the private firm pockets $10,000 up front and the agency another $10,000. One such firm, Mortgage Resolution Partners, has already been formed in San Francisco for this purpose.

There are some technical questions.  How is the house value determined?  By appraisers, presumably, but we saw in the housing bubble how useless their numbers were.  And what if the mortgage had been securitized, i.e., put into a mortgage-backed security?  The Federal Reserve holds a lot of these securities.  What if a local government entity tried to seize a mortgage that was ultimately owned by the Fed?  Wouldn’t that be fun?

Technical questions aside, the whole idea portends a massive new assault on private property by ravenous politicians and bureaucrats and their private co-conspirators.

Eminent domain has generally been understood as a way of solving holdout problems when a “public” project is proposed.  Such projects typically require acquisition of property from a number of owners and can’t be built at all unless and until all owners are willing to sell.  A single holdout can ruin the project.  Thus eminent domain has almost always been used to seize real property (land and buildings) as opposed to personal property such as mortgages.  (Private solutions to holdout problems have been proposed.)

The only ultimate limitation on the use of eminent domain is a clause in the Fifth Amendment to the U.S. Constitution which says “nor shall private property be taken for public use without just compensation.”  That clause is of course wide open to varying interpretations of “public use” and “just compensation.”

A landmark Supreme Court 5-4 decision in 2005 held that the City of New London could seize a modest house owned by Suzette Kelo and hand it over to a private developer.  The house and surrounding buildings were seized and destroyed but the project went bust and the land is still vacant.  This was a significant extension of the notion of “public use.”  Justice Stevens in his decision to uphold the City noted that “a public purpose will often benefit individual private parties.”

Indeed.  Can there ever be a public project that does not benefit some private party?  Any public project necessarily diverts resources to some private party such as a contractor or neighbors whose property values are enhanced.  Turning the proposition around, almost any private project throws off some public benefits.  Kelo opened the door to conspiracies of private developers and public officials to launch almost any sort of assault on anyone’s private property.

The “just compensation” clause is also gravely problematic.  Suzette Kelo loved her little pink house.  Its market value wasn’t nearly enough to compensate for the emotional loss she suffered when she was kicked out.  Values, as distinct from prices, are subjective and are revealed by voluntary transactions.

In addition to the obvious grave immorality of this latest assault on private property, consider the incentive problems that it raises.  Future savers will be reluctant to invest their savings in mortgages or financial products containing mortgages knowing they could be expropriated.  Homeowners will find loans harder to get, thanks to the “Homeowner Protection Act.”  (Echoes of Ludwig von Mises: government interventions invariably make things worse for their ostensible beneficiaries.) There will be a marginal shift away from saving toward consumption.  Economic growth will be marginally slowed, for which politicians will blame the free market and plump for yet more expansions of government power.

Should the San Bernardino project go forward, it will be very likely to end up at the Supreme Court.  The Kelo and Obamacare decisions do not bode well for the result.

Lester Maddox, Hero or Bum?

Warren Gibson History, Politics , , , , , , ,

Ask anybody outside Georgia who Lester Maddox was and you’re likely to get a blank stare.  I’m not from Georgia but I remember the attention he got in the late 1960’s.  Aside from Alabama Governor George Wallace, Maddox was the best known rear-guard defender of racial segregation in the South at that time.

Mr. Maddox and his family operated a modest restaurant called the Pickrick adjacent to the Georgia Tech campus in Atlanta.  The fried chicken must have been good, because he prospered.  He gradually became interested in politics and began to express them bluntly.

Maddox was incensed when the Civil Rights Act became law in 1964.  Among other things, the Act outlawed racial discrimination in “public accommodations.”  He did not welcome black people as customers, and when three black men tried to enter his property in July of 1964, he reportedly waved a pistol at them and shouted: “You no good dirty devils! You dirty Communists!”  He believed that as owner of the restaurant, it was his prerogative to decide whom he wanted to serve. The pick handles that were initially decorations in his restaurant became symbols of his defiance, and he sold them as autographed “Pickrick drumsticks” in his souvenir shop.

Maddox consistently defended his stand as an issue of property rights. Continue reading →

Mali: Let It Collapse, Duh! Part 2

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

I just came across an article in the New York Times via Bill Easterly, and it is very discouraging. The article is, of course, about the aspirations of Azawad, the breakaway region of Mali that just declared its independence. The article outlines the slim-to-none chances Azawad has of breaking free from the shackles of colonial legacy and African despotism:

“[…] there is little likelihood that anyone will defeat the Tuaregs on the battlefield anytime soon.

Still, they face slim odds of establishing a nation. Just ask Ahmed Abdi Habsade, a government minister in Africa’s other unrecognized state, Somaliland. ‘We have many problems,’ Mr. Habsade said in a telephone interview from Somaliland’s capital, Hargeysa. ‘The country cannot get donations from the U.N. or other governments. We are not having a budget to develop our country.’

Somaliland, which sits in the northwestern corner of Somalia, has been a de-facto independent nation for the better part of two decades, and an oasis of calm in the chaos that has swept up Somalia. Its claims to independence date from the colonial era, when it was a British protectorate while Somalia was controlled by Italy. The two states merged after independence, but the Somalilanders had almost immediate regrets, and have been trying to break free ever since.

Somaliland has had successes, including holding peaceful elections, yet it has struggled without an international stamp of Continue reading →

From the Comments: A Note on Property Rights

Brandon Christensen Comments , , , ,

A couple of very thoughtful comments have been posted in regards to property rights over the past couple of weeks, and I want to single them out for their thought-provoking content.  JuanBP writes:

Libertarian socialists (no, my dear American friends, that is not an oxymoron) believe in freedom of speech, association,religion and all other liberties cherished by Libertarians. Where we differ profoundly is in our understanding of what constitutes economic liberty – for we tend to consider that property, the very foundation of capitalism, is theft.

And from Benjamin David Steele:

There is one general difference I see between the left and the right which also would refer to the general difference between left-libertarians and right-libertarians. Those on the left tend to see human rights as prior to property rights. And those on the right tend to see property rights as prior to human rights. It is a difference of emphasis, but a very big difference in terms of practical application. As a left-winger with libertarian tendencies, I see no evidence that defending property rights inevitably leads to defending human rights.

Both of these comments provide great insights into one of the many myths espoused in political discourse throughout the world: that property rights are somehow different from any other human right. Continue reading →

More Musings on Colonialism

Brandon Christensen History , , , , , , , , , , , , , ,

I recently attended an excellent lecture at Cabrillo College, located in central California, by an International Relations scholar who focused on the effects of colonialism. We took a solid look at the ‘World Systems Theory’ of why the developing world is, well, developing, and it was great to go over this school of thought’s main arguments.

For those of you who don’t know, World Systems Theory is a Marxian analysis that basically states that poor countries are poor because of the effects of colonialism, and the evidence supporting their claims is pretty damn solid. Basically, the World Systems theorists argue that when the various European powers gained outright control of non-European lands (this process in itself took centuries, by the way, and I deplore the historical narrative that argues Europeans set out to conquer foreign lands and divide up the spoils of war for reasons outlined in the link provided), the European powers set up states that were designed specifically to export raw agricultural materials to European factories, to be produced by European workers, and to be consumed by European (and elite non-European) consumers.

This is pretty much what happened, and explains why most of the developing world is dependent upon raw commodity exports (that are shipped to European markets) for most of their well-being. Unfortunately, the very solutions that the World Systems theorists propose to dismantle the structural inequalities that exist in this world will (and have) actually led to more of the same structural inequality.

Allow me to explain. Continue reading →

Catching the Killer Kony: What Trends for Tools Can Tell Us About Political Structures

Brandon Christensen Current Events, History, Politics , , , , , , , , , ,

I am more than amused at the current trend of teenage boppers and serious college students catching up with the decades-long war happening in the Congo basin. It makes feel superior! If we really want to solve the problem of war in the Congo basin (and everywhere else in the post-colonial world) then we are going to have start looking at the political structures that have been left behind by the colonialists and enhanced by the indigenous (and socialist-educated) elite.

I have a quick blurb that may be of use. I say “may be” because I have decided to use Nigeria as an example rather than Uganda because it is a region I am much more familiar with, but the underlying concept is still the same. My more intelligent readers will no doubt grasp this nuance right away, but it may be harder to grasp for those readers not well-versed in social theory. I would, as always, be grateful for critiques and comments alike.

Religion has virtually nothing to do with the current conflict tearing Nigeria apart, and everything to do with the legacy of British imperialism (which went hand-in-hand with socialist legislation in the late decades of the 19th century). Continue reading →