Elizabeth Warren

Barack Channels Princess SummerFall WinterSpring

The princess of the title is Elizabeth Warren, self-reputed to be of Cherokee descent. And, as Native Americans go, Warren is about as authentic as Princess SummerFall WinterSpring of Howdy Doody.

You may remember Warren’s bleat of last September, in support of Obama’s plan to soak “the rich.” It caused ripples in the blogosphere (here and here, for example). The bleat? It goes like this:

I hear all this, you know, Well, this is class warfare, this is whatever. No. There is nobody in this country who got rich on his own — nobody.

You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.

Last week, in Virgina, The Mighty O said the same thing in slightly different words:

There are a lot of wealthy, successful Americans who agree with me — because they want to give something back.  They know they didn’t — look, if you’ve been successful, you didn’t get there on your own.  You didn’t get there on your own.  I’m always struck by people who think, well, it must be because I was just so smart.  There are a lot of smart people out there.  It must be because I worked harder than everybody else.  Let me tell you something — there are a whole bunch of hardworking people out there.

I repeat what I said in response to Warren’s bleat:

Who said anything about anyone getting rich on his own? But didn’t the factory owner — and other “malefactors of great wealth” — pay a “fair share”of the taxes that support roads, education, and police and fire forces? Yes.* Didn’t the factory owner pay his workers for their labor? Yes, and sometimes (in the case of union workers) at the expense of consumers and those workers who couldn’t find employment because unions effectively limit entry to the labor market.

If anyone owes “the rest of us” anything, it’s the workers who received subsidized educations that enabled them to earn good wages at factories that were built because factory owners, shareholders, bond holders, and (sometimes) venture capitalists put their own money at risk.

Workers and others (including Elizabeth Warren) ought to be grateful to the “malefactors of great wealth” who have — against heavy odds — enabled America’s prosperity.

Tom Smith of The Right Coast weighs in with this:

…{H]ow many more successful businesses, inventions, products, services, toys, tools, insights, and just plain fun would there be, if government did not in the first place make it so ridiculously difficult to start a business and keep it going? I don’t see our young president taking credit on behalf of the state for all the failures it help cause, all the ideas that never got off the ground because the regulatory hurdles were so high, or all the established companies that never had to face competition because they had managed to get their rents written into law. This is part of the seen and not seen insight of Bastiat. What you see is a successful business when it manages to survive, and then people run up, the same people who taxed and regulated it nearly to death, and say I helped! I helped! What you don’t see are all the businesses that perished or never got started because of the heavy hand of the state. And it’s a very heavy hand….

I started a business, commercially unsuccessful, sadly, but we created some great technology. I was a libertarian before that, but I was really a libertarian afterwards. It’s difficult to even explain how pervasive, expensive, frustrating and sometimes just plain insuperable the regulatory and taxation burden of the state is. It’s not what did our venture in, but it helped….

It’s obvious, but still worth saying — for our young President to suggest that government deserves some large part of the credit for the achievements of business founders who manage, in spite of it all, to start a business and make of a go of it, is deeply, deeply perverse. What it ought to get credit for are all the unseen businesses, no longer here or never to be, that it is responsible for.

I can tell you, from bitter experience as a business owner and corporate officer, that Smith is exactly right. The burdens that government imposes on the creation, expansion, and operation of businesses are myriad and onerous. Most Americans aren’t aware of just how much government does to discourage the creation of jobs, income, and wealth because most Americans — even those who are employed — are not exposed to the ugliness of the business-government interface. If business-government transactions were rated like movies, they would be rated XXX.

There is one more thing to be said about the Warren-Obama attack on industriousness. It’s wrong, as any economist worth his salt could tell you. (That excludes Paul Krugman and his fellow worshipers at the altar of big government.) Despite the pretensions of bleeding heart libertarians and their brethren on the left, no one on Earth is qualified to say how much a person deserves to earn. Aside from thieves and others who coerce their earnings from others (e.g., government officials, members of compulsory unions), Americans earn what they are able to command for their services, on the basis of the value of those services to others.

The factory owner who makes a lot of money does so — after having taken the considerable risk of owning a factory and putting up with a lot of crap from government — because what he produces is valuable to others. He is being rewarded more than his employees because he is taking  risks and putting up with harassment. He is, in other words, being rewarded for his contributions to the success of his enterprise. (Did Barack or Elizabeth do anything to help him create it? Did the workers do more than they were paid to do? No, to both questions.)

And if the factory owner loses a lot of money and goes out of business, is it the fault of those who failed to buy his products? Would Barack Obama and Elizabeth Warren say that everyone let him down? They should, because by their “logic” the failed factory owner was failed by everyone who didn’t buy his products, and so they owe him something.

But most American business owners are not whiny brats like Barack Obama, Elizabeth Warren, and the freeloaders whose votes they depend on to stay in power.

Related posts:
The Causes of Economic Growth
A Short Course in Economics
Addendum to a Short Course in Economics
The Price of Government
Asymmetrical (Ideological) Warfare
“Buy Local”
Giving Back, Again
Taxing the Rich
More about Taxing the Rich
Luck-Egalitarianism and Moral Luck
Union-Busting
In Defense of Wal-Mart
Union Thuggery
Estimating the Rahn Curve: Or, How Government Inhibits Economic Growth

Not-So-Random Thoughts (III)

This is the third of a series of occasional posts that link to and discuss writings on matters that have been treated by this blog. The first edition is here; the second, here; the fourth, here; the fifth, here; and the sixth, here.

Apropos Science

In the vein of “Something from Nothing?” there is this:

[Stephen] Meyer also argued [in a a recent talk at the University Club in D.C.] that biological evolutionary theory, which “attempts to explain how new forms of life evolved from simpler pre-existing forms,” faces formidable difficulties. In particular, the modern version of Darwin’s theory, neo-Darwinism, also has an information problem.

Mutations, or copying errors in the DNA, are analogous to copying errors in digital code, and they supposedly provide the grist for natural selection. But, Meyer said: “What we know from all codes and languages is that when specificity of sequence is a condition of function, random changes degrade function much faster than they come up with something new.”…

The problem is comparable to opening a big combination lock. He asked the audience to imagine a bike lock with ten dials and ten digits per dial. Such a lock would have 10 billion possibilities with only one that works. But the protein alphabet has 20 possibilities at each site, and the average protein has about 300 amino acids in sequence….

Remember: Not just any old jumble of amino acids makes a protein. Chimps typing at keyboards will have to type for a very long time before they get an error-free, meaningful sentence of 150 characters. “We have a small needle in a huge haystack.” Neo-Darwinism has not solved this problem, Meyer said. “There’s a mathematical rigor to this which has not been a part of the so-called evolution-creation debate.”…

“[L]eading U.S. biologists, including evolutionary biologists, are saying we need a new theory of evolution,” Meyer said. Many increasingly criticize Darwinism, even if they don’t accept design. One is the cell biologist James Shapiro of the University of Chicago. His new book is Evolution: A View From the 21st Century. He’s “looking for a new evolutionary theory.” David Depew (Iowa) and Bruce Weber (Cal State) recently wrote in Biological Theory that Darwinism “can no longer serve as a general framework for evolutionary theory.” Such criticisms have mounted in the technical literature. (Tom Bethell, “Intelligent Design at the University Club,” American Spectator, May 2012)

And this:

[I]t is startling to realize that the entire brief for demoting human beings, and organisms in general, to meaningless scraps of molecular machinery — a demotion that fuels the long-running science-religion wars and that, as “shocking” revelation, supposedly stands on a par with Copernicus’s heliocentric proposal — rests on the vague conjunction of two scarcely creditable concepts: the randomness of mutations and the fitness of organisms. And, strangely, this shocking revelation has been sold to us in the context of a descriptive biological literature that, from the molecular level on up, remains almost nothing buta documentation of the meaningfully organized, goal-directed stories of living creatures.

Here, then, is what the advocates of evolutionary mindlessness and meaninglessness would have us overlook. We must overlook, first of all, the fact that organisms are masterful participants in, and revisers of, their own genomes, taking a leading position in the most intricate, subtle, and intentional genomic “dance” one could possibly imagine. And then we must overlook the way the organism responds intelligently, and in accord with its own purposes, to whatever it encounters in its environment, including the environment of its own body, and including what we may prefer to view as “accidents.” Then, too, we are asked to ignore not only the living, reproducing creatures whose intensely directed lives provide the only basis we have ever known for the dynamic processes of evolution, but also all the meaning of the larger environment in which these creatures participate — an environment compounded of all the infinitely complex ecological interactions that play out in significant balances, imbalances, competition, cooperation, symbioses, and all the rest, yielding the marvelously varied and interwoven living communities we find in savannah and rainforest, desert and meadow, stream and ocean, mountain and valley. And then, finally, we must be sure to pay no heed to the fact that the fitness, against which we have assumed our notion of randomness could be defined, is one of the most obscure, ill-formed concepts in all of science.

Overlooking all this, we are supposed to see — somewhere — blind, mindless, random, purposeless automatisms at the ultimate explanatory root of all genetic variation leading to evolutionary change. (Stephen L. Talbott, “Evolution and the Illusion of Randomness,” The New Atlantis, Fall 2011)

My point is not to suggest that that the writers are correct in their conjectures. Rather, the force of their conjectures shows that supposedly “settled” science is (a) always far from settled (on big questions, at least) and (b) necessarily incomplete because it can never reach ultimate truths.

Trayvon, George, and Barack

Recent revelations about the case of Trayvon Martin and George Zimmerman suggest the following:

  • Martin was acting suspiciously and smelled of marijuana.
  • Zimmerman was rightly concerned about Martin’s behavior, given the history of break-ins in Zimmerman’s neighborhood.
  • Martin attacked Zimmerman, had him on the ground, was punching his face, and had broken his nose.
  • Zimmerman shot Martin in self-defense.

Whether the encounter was “ultimately avoidable,” as a police report asserts, is beside the point.  Zimmerman acted in self-defense, and the case against him should be dismissed. The special prosecutor should be admonished by the court for having succumbed to media and mob pressure in bringing a charge of second-degree murder against Zimmerman.

What we have here is the same old story: Black “victim”–>media frenzy to blame whites (or a “white Hispanic”), without benefit of all relevant facts–>facts exonerate whites. To paraphrase Shakespeare: The first thing we should do after the revolution is kill all the pundits (along with the lawyers).

Obama famously said, “”If I had a son, he would look like Trayvon.” Given the thuggish similarity between Trayvon and Obama (small sample here), it is more accurate to say that if Obama had a son, he would be like Trayvon.

Creepy People

Exhibit A is Richard Thaler, a self-proclaimed libertarian who is nothing of the kind. Thaler defends the individual mandate that is at the heart of Obamacare (by implication, at least), when he attacks the “slippery slope” argument against it. Annon Simon nails Thaler:

Richard Thaler’s NYT piece from a few days ago, Slippery-Slope Logic, Applied to Health Care, takes conservatives to task for relying on a “slippery slope” fallacy to argue that Obamacare’s individual mandate should be invalidated. Thaler believes that the hypothetical broccoli mandate — used by opponents of Obamacare to show that upholding the mandate would require the Court to acknowledge congressional authority to do all sorts of other things — would never be adopted by Congress or upheld by a federal court. This simplistic view of the Obamacare litigation obscures legitimate concerns over the amount of power that the Obama administration is claiming for the federal government. It also ignores the way creative judges can use previous cases as building blocks to justify outcomes that were perhaps unimaginable when those building blocks were initially formed….

[N]ot all slippery-slope claims are fallacious. The Supreme Court’s decisions are often informed by precedent, and, as every law student learned when studying the Court’s privacy cases, a decision today could be used by a judge ten years from now to justify outcomes no one had in mind.

In 1965, the Supreme Court in Griswold v. Connecticut, referencing penumbras and emanations, recognized a right to privacy in marriage that mandated striking down an anti-contraception law.

Seven years later, in Eisenstadt v. Baird, this right expanded to individual privacy, because after all, a marriage is made of individuals, and “[i]f the right of privacy means anything, it is the right of the individual . . . to be free from unwarranted governmental intrusion into matters so fundamentally affecting a person as the decision whether to bear or beget a child.”

By 1973 in Roe v. Wade, this precedent, which had started out as a right recognized in marriage, had mutated into a right to abortion that no one could really trace to any specific textual provision in the Constitution. Slippery slope anyone?

This also happened in Lawrence v. Texas in 2003, where the Supreme Court struck down an anti-sodomy law. The Court explained that the case did not involve gay marriage, and Justice O’Connor’s concurrence went further, distinguishing gay marriage from the case at hand. Despite those pronouncements, later decisions enshrining gay marriage as a constitutionally protected right have relied upon Lawrence. For instance, Goodridge v. Department of Public Health (Mass. 2003) cited Lawrence 9 times, Varnum v. Brien (Iowa 2009) cited Lawrence 4 times, and Perry v. Brown (N.D. Cal, 2010) cited Lawrence 9 times.

However the Court ultimately rules, there is no question that this case will serve as a major inflection point in our nation’s debate about the size and scope of the federal government. I hope it serves to clarify the limits on congressional power, and not as another stepping stone on the path away from limited, constitutional government. (“The Supreme Court’s Slippery Slope,” National Review Online, May 17, 2012)

Simon could have mentioned Wickard v. Filburn (1942), in which the Supreme Court brought purely private, intrastate activity within the reach of Congress’s power to regulate interstate commerce. The downward slope from Wickard v. Filburn to today’s intrusive regulatory regime has been been not merely slippery but precipitous.

Then there is Brian Leiter, some of whose statist musings I have addressed in the past. It seems that Leiter has taken to defending the idiotic Elizabeth Warren for her convenient adoption of a Native American identity. Todd Zywicki tears a new one for Leiter:

I was out of town most of last week and I wasn’t planning on blogging any more on the increasingly bizarre saga of Elizabeth Warren’s claim to Native American ancestry, which as of the current moment appears to be entirely unsubstantiated.  But I was surprised to see Brian Leiter’s post doubling-down in his defense of Warren–and calling me a “Stalinist” to boot (although I confess it is not clear why or how he is using that term).  So I hope you will indulge me while I respond.

First, let me say again what I expressed at the outset–I have known from highly-credible sources for a decade that in the past Warren identified herself as a Native American in order to put herself in a position to benefit from hiring preferences (I am certain that Brian knows this now too).  She was quite outspoken about it at times in the past and, as her current defenses have suggested, she believed that she was entitled to claim it.  So there would have been no reason for her to not identify as such and in fact she was apparently quite unapologetic about it at the time….

Second, Brian seems to believe for some reason that the issue here is whether Warren actually benefited from a hiring preference.  Of course it is not (as my post makes eminently clear).  The issue I raised is whether Warren made assertions as part of the law school hiring process in order to put herself in a position to benefit from a hiring preference for which she had no foundation….

Third, regardless of why she did it, Warren herself actually had no verifiable basis for her self-identification as Native American.  At the very least her initial claim was grossly reckless and with no objective foundation–it appears that she herself has never had any foundation for the claim beyond “family lore” and her “high cheekbones.”… Now it turns out that the New England Historical Genealogical Society, which had been the source for the widely-reported claim that she might be 1/32 Cherokee, has rescinded its earlier conclusion and now says “We have no proof that Elizabeth Warren’s great great great grandmother O.C. Sarah Smith either is or is not of Cherokee descent.”  The story adds, “Their announcement came in the wake of an official report from an Oklahoma county clerk that said a document purporting to prove Warren’s Cherokee roots — her great great great grandmother’s marriage license application — does not exist.”  A Cherokee genealogist has similarly stated that she can find no evidence to support Warren’s claim.  At this point her claim appears to be entirely unsupported as an objective matter and it appears that she herself had no basis for it originally.

Fourth, Brian’s post also states the obvious–that there is plenty of bad blood between Elizabeth and myself.  But, of course, the only reason that this issue is interesting and relevant today is because Warren is running for the U.S. Senate and is the most prominent law professor in America at this moment.

So, I guess I’ll conclude by asking the obvious question: if a very prominent conservative law professor (say, for example, John Yoo) had misrepresented himself throughout his professorial career in the manner that Elizabeth Warren has would Brian still consider it to be “the non-issue du jour“?  Really?

I’m not sure what a “Stalinist” is.  But I would think that ignoring a prominent person’s misdeeds just because you like her politics, and attacking the messenger instead, just might fit the bill. (“New England Genealogical Historical Society Rescinds Conclusion that Elizabeth Warren Might Be Cherokee,” The Volokh Conspiracy, May 17, 2012)

For another insight into Leiter’s character, read this and weep not for him.

Tea Party Sell-Outs

Business as usual in Washington:

This week the Club for Growth released a study of votes cast in 2011 by the 87 Republicans elected to the House in November 2010. The Club found that “In many cases, the rhetoric of the so-called “Tea Party” freshmen simply didn’t match their records.” Particularly disconcerting is the fact that so many GOP newcomers cast votes against spending cuts.

The study comes on the heels of three telling votes taken last week in the House that should have been slam-dunks for members who possess the slightest regard for limited government and free markets. Alas, only 26 of the 87 members of the “Tea Party class” voted to defund both the Economic Development Administration and the president’s new Advanced Manufacturing Technology Consortia program (see my previous discussion of these votes here) and against reauthorizing the Export-Import Bank (see my colleague Sallie James’s excoriation of that vote here).

I assembled the following table, which shows how each of the 87 freshman voted. The 26 who voted for liberty in all three cases are highlighted. Only 49 percent voted to defund the EDA. Only 56 percent voted to defund a new corporate welfare program requested by the Obama administration. And only a dismal 44 percent voted against reauthorizing “Boeing’s bank.” That’s pathetic. (Tad DeHaven, “Freshman Republicans Switch from Tea to Kool-Aid,” Cato@Liberty, May 17, 2012)

Lesson: Never trust a politician who seeks a position of power, unless that person earns trust by divesting the position of power.

PCness

Just a few of the recent outbreaks of PCness that enraged me:

Michigan Mayor Calls Pro-Lifers ‘Forces of Darkness’” (reported by LifeNews.com on May 11, 2012)

US Class Suspended for Its View on Islam” (reported by CourierMail.com.au, May 11, 2012)

House Democrats Politicize Trayvon Martin” (posted at Powerline, May 8, 2012)

Chronicle of Higher Education Fires Blogger for Questioning Seriousness of Black Studies Depts.” (posted at Reason.com/hit & run, May 8, 2012)

Technocracy, Externalities, and Statism

From a review of Robert Frank’s The Darwin Economy:

In many ways, economics is the discipline best suited to the technocratic mindset. This has nothing to do with its traditional subject matter. It is not about debating how to produce goods and services or how to distribute them. Instead, it relates to how economics has emerged as an approach that distances itself from democratic politics and provides little room for human agency.

Anyone who has done a high-school course in economics is likely to have learned the basics of its technocratic approach from the start. Students have long been taught that economics is a ‘positive science’ – one based on facts rather than values. Politicians are entitled to their preferences, so the argument went, but economists are supposed to give them impartial advice based on an objective examination of the facts.

More recently this approach has been taken even further. The supposedly objective role of the technocrat-economist has become supreme, while the role of politics has been sidelined….

The starting point of The Darwin Economy is what economists call the collective action problem: the divergence between individual and collective interests. A simple example is a fishermen fishing in a lake. For each individual, it might be rational to catch as many fish as possible, but if all fishermen follow the same path the lake will eventually be empty. It is therefore deemed necessary to find ways to negotiate this tension between individual and group interests.

Those who have followed the discussion of behavioural economics will recognise that this is an alternative way of viewing humans as irrational. Behavioural economists focus on individuals behaving in supposedly irrational ways. For example, they argue that people often do not invest enough to secure themselves a reasonable pension. For Frank, in contrast, individuals may behave rationally but the net result of group behaviour can still be irrational….

…From Frank’s premises, any activity considered harmful by experts could be deemed illegitimate and subjected to punitive measures….

…[I]t is … wrong to assume that there is no more scope for economic growth to be beneficial. Even in the West, there is a long way to go before scarcity is limited. This is not just a question of individuals having as many consumer goods as they desire – although that has a role. It also means having the resources to provide as many airports, art galleries, hospitals, power stations, roads, schools, universities and other facilities as are needed. There is still ample scope for absolute improvements in living standards…. (Daniel Ben-ami, “Delving into the Mind of the Technocrat,” The Spiked Review of Books, February 2012)

There is much to disagree with in the review, but the quoted material is right on. It leads me to quote myself:

…[L]ife is full of externalities — positive and negative. They often emanate from the same event, and cannot be separated. State action that attempts to undo negative externalities usually results in the negation or curtailment of positive ones. In terms of the preceding example, state action often is aimed at forcing the attractive woman to be less attractive, thus depriving quietly appreciative men of a positive externality, rather than penalizing the crude man if his actions cross the line from mere rudeness to assault.

The main argument against externalities is that they somehow result in something other than a “social optimum.” This argument is pure, economistic hokum. It rests on the unsupportable belief in a social-welfare function, which requires the balancing (by an omniscient being, I suppose) of the happiness and unhappiness that results from every action that affects another person, either directly or indirectly….

A believer in externalities might respond by saying that they are of “economic” importance only as they are imposed on bystanders as a spillover from economic transactions, as in the case of emissions from a power plant that can cause lung damage in susceptible persons. Such a reply is of a kind that only an omniscient being could make with impunity. What privileges an economistic thinker to say that the line of demarcation between relevant and irrelevant acts should be drawn in a certain place? The authors of campus speech codes evidently prefer to draw the line in such a way as to penalize the behavior of the crude man in the above example. Who is the economistic thinker to say that the authors of campus speech codes have it wrong? And who is the legalistic thinker to say that speech should be regulated by deferring to the “feelings” that it arouses in persons who may hear or read it?

Despite the intricacies that I have sketched, negative externalities are singled out for attention and rectification, to the detriment of social and economic intercourse. Remove the negative externalities of electric-power generation and you make more costly (and even inaccessible) a (perhaps the) key factor in America’s economic growth in the past century. Try to limit the supposed negative externality of human activity known as “greenhouse gases” and you limit the ability of humans to cope with that externality (if it exists) through invention, innovation, and entrepreneurship. Limit the supposed negative externality of “offensive” speech and you quickly limit the range of ideas that may be expressed in political discourse. Limit the supposed externalities of suburban sprawl and you, in effect, sentence people to suffer the crime, filth, crowding, contentiousness, heat-island effects, and other externalities of urban living.

The real problem is not externalities but economistic and legalistic reactions to them….

The main result of rationalistic thinking — because it yields vote-worthy slogans and empty promises to fix this and that “problem” — is the aggrandizement of the state, to the detriment of civil society.

The fundamental error of rationalists is to believe that “problems” call for collective action, and to identify collective action with state action. They lack the insight and imagination to understand that the social beings whose voluntary, cooperative efforts are responsible for mankind’s vast material progress are perfectly capable of adapting to and solving “problems,” and that the intrusions of the state simply complicate matters, when not making them worse. True collective action is found in voluntary social and economic intercourse, the complex, information-rich content of which rationalists cannot fathom. They are as useless as a blind man who is shouting directions to an Indy 500 driver….

Theodore Dalrymple

If you do not know of Theodore Dalrymple, you should. His book, In Praise of Prejudice: The Necessity of Preconceived Ideas, inspired  “On Liberty,” the first post at this blog. Without further ado, I commend these recent items by and about Dalrymple:

Rotting from the Head Down” (an article by Dalrymple about the social collapse of Britain, City Journal, March 8, 2012)

Symposium: Why Do Progressives Love Criminals?” (Dalrymple and others, FrontPageMag.com, March 9, 2012)

Doctors Should Not Vote for Industrial Action,” a strike, in American parlance (a post by Dalrymple, The Social Affairs Unit, March 22, 2012)

The third item ends with this:

The fact is that there has never been, is never, and never will be any industrial action over the manifold failures of the public service to provide what it is supposed to provide. Whoever heard of teachers going on strike because a fifth of our children emerge from 11 years of compulsory education unable to read fluently, despite large increases in expenditure on education?

If the doctors vote for industrial action, they will enter a downward spiral of public mistrust of their motives. They should think twice before doing so.

Amen.

The Higher-Eduction Bubble

The title of a post at The Right Coast tells the tale: “Under 25 College Educated More Unemployed than Non-college Educated for First Time.” As I wrote here,

When I entered college [in 1958], I was among the 28 percent of high-school graduates then attending college. It was evident to me that about half of my college classmates didn’t belong in an institution of higher learning. Despite that, the college-enrollment rate among high-school graduates has since doubled.

(Also see this.)

American taxpayers should be up in arms over the subsidization of an industry that wastes their money on the useless education of masses of indeducable persons. Then there is the fact that taxpayers are forced to subsidize the enemies of liberty who populate university faculties.

The news about unemployment among college grads may hasten the bursting of the higher-ed bubble. It cannot happen too soon.

Taxes: Theft or Duty?

As goofy as Ron Paul is about defense and foreign policy, he is mostly right about domestic policy, namely that there should be little of it — especially at the national level. This is from his exchange with David Gregory on Meet the Press (October 23, 2011):

MR. GREGORY:  Let me, let me ask you about the role of government.  You’ve said about taxation, in a way that doesn’t minces words, the following: “Taxation is immoral,” you told the Libertarian Party News.  Would you scrap the tax code altogether?

REP. PAUL:  That would be a pretty good idea, a pretty good start.  I, I can qualify it if I’m allowed.  Taxation is theft when you take money from one group to give it to, to another, when you, when you transfer the wealth.  Now, taxation could be accomplished with user fees and, you know, highway fees and gasoline taxes and import taxes.  But the income tax is based on the assumption that the government owns you, owns all of your income and provides the conditions on which they allow you to keep a certain percentage.  That, to me, is immoral, and the founders didn’t like it.  That’s why the Constitution had to be amended in 1913.

Not eloquent, but fairly near the mark.

Government has essentially one legitimate function, which is to protect citizens from predators, foreign and domestic. That covers national defense and domestic justice (including the enforcement of contracts and prosecution of fraud). Those functions could be provided by private agencies, but — because of the danger of warlordism — they are best provided by government and funded from a true flat tax.

A proper division of labor would place defense in the hands of the national government and justice in the hands of State and local governments. This would eliminate the ability of the national government to criminalize conduct for the sake of imposing its will on everyone. For the same reason, the provision of justice should be devolved to the lowest possible level within each State.

I see no need for State and local governments to do more than provide justice, though the government of a very small community — say, not more than 150 persons — might legitimately do more if authorized by the community, following rules explicitly and regularly adopted by consensus. Expanding the scale of government action beyond the jurisdiction of a small community courts runaway statism and precludes the provision of services (utilities, highways, etc.) by private actors, which are subject to discipline by market forces.

With that background, I turn to the October 20, 2011, issue of The New Republic and “Don’t Mess with Taxes: A moral defense.” Excerpts of the editorial (in italics) are accompanied by my comments (in brackets and boldface):

Elizabeth Warren, the Harvard law professor now running for U.S. Senate, is getting a lot of attention for the video of a speech she made recently. It wasn’t just because she was taking on Republican talking points more forcefully than most Democrats do these days. It was also because she was defending an idea almost nobody in American politics dares to champion anymore, at least explicitly: She was defending the idea of taxes. [Elizabeth Warren is all wet.]

In recent decades, Republican politicians and key allies, most notably anti-tax crusader Grover Norquist, have succeeded in demonizing taxes, as if the very concept of a tax itself were immoral. [Not quite. See above.]

But there is nothing wrong with asking [asking?] people to pay taxes. On the contrary, there is something very right about it. Nobody [nobody?] questions whether society [the state] can require people to serve on a jury or, in times of war, to enlist in the military. [So soon is Vietnam forgotten, along with its main legal legacy: all-volunteer armed forces.] So why do we question whether society [the state] can require people to pay for the government whose services, and protection, they enjoy? [Most of us do not "enjoy" government services, other than defense and justice, and even those that we do "enjoy" would be provided more efficiently by private firms.]

The moral case for taxation rests on two separate, but related, principles. The first is distributional. History teaches us that capitalism is an excellent economic system for generating wealth. But history also teaches us that capitalism will create losers as well as winners, often because of forces beyond any individual’s control. Whether it’s accident or illness, mismatched skills or misallocated resources, large numbers of people will inevitably find themselves in financial difficulty—without a job, without savings, and without enough money to pay for the basic necessities of life. It can be crippling for them and crippling for their children, so that poverty, like affluence, becomes its own sort of inheritance. [And that's another thing better left to the private sector: charity. Charity-by-government is an inefficient way of taking from the few to give to the many -- but it yields votes, as in "tax and tax, and spend and spend, and elect and elect."]

A civilized society recognizes this problem and vows to mitigate it. [A state, driven by power-lust, is not a society, and cannot claim to be civilized.] If capitalism does not offer everybody at least some realistic hope of upward mobility, it cannot survive.  [But it does offer that hope, and it will survive unless the minions of the state have their way.] Here in the United States, a part of our solution has been to enact government programs that offer the needy minimal allotments of sustenance (food stamps) and shelter (housing choice vouchers), that provide the less affluent with cash (Temporary Assistance for Needy Families) and college tuition (Pell Grants), and that guarantee all citizens pensions (Social Security) and health insurance (Medicare, Medicaid, and the Affordable Care Act). These programs cost money. And the money has to come from somewhere. [These programs are self-defeating because they (1) create dependency, (2) reduce the incentive to better oneself, (3) reduce the incentive to save for one's future needs, and (4) drain resources from growth-producing investments that create jobs and higher incomes, and allow people to save for future needs.]

The second reason we need taxes isn’t about the least fortunate; it’s about public goods. You’ll frequently hear conservatives argue that taking money from people, particularly successful people, is unfair because they, not the government, earned that money. But that’s not quite right, for reasons Warren explained very well in her monologue. Behind every successful individual is a set of public investments that past generations made. Could Bill Gates have made his fortune without government-financed education and technology? Could Sam Walton’s stores have spread across the country without government-sponsored roads on which goods and customers travel? “You built a factory and it turned into something terrific, or a great idea?” Warren said. “God bless. Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.” ["Public goods" are a crock. Elizabeth Warren is all wet.]

[O]n the morality of asking [asking?] people to pay taxes, there should be no debate at all. Taxes are an act of citizenship [coercion]. We should all be proud to pay them. [Speak for yourself, kemosabe.]

Other than that, I found the punctuation and spelling to be impeccable.

As for the question posed in the title of this post: theft, all theft, because even essential protective services are not funded equitably.

Related posts:
The Social Welfare Function
Risk and Regulation
A Short Course in Economics
The Interest-Group Paradox
Addendum to a Short Course in Economics
Monopoly: Private Is Better than Public
Utilitarianism vs. Liberty
Utilitarianism, “Liberalism,” and Omniscience
Accountants of the Soul
The Real Burden of Government
Zones of Liberty
Toward a Risk-Free Economy
Rawls Meets Bentham
The Rahn Curve at Work
A True Flat Tax
The Case of the Purblind Economist
The Illusion of Prosperity and Stability
Estimating the Rahn Curve: Or, How Government Inhibits Economic Growth
Asymmetrical (Ideological) Warfare
Giving Back, Again
Taxing the Rich
More about Taxing the Rich
Luck-Egalitarianism and Moral Luck
The Destruction of Society in the Name of “Society”
What Free-Rider Problem?
Utilitarianism and Psychopathy
Elizabeth Warren Is All Wet

Elizabeth Warren Is All Wet

Elizabeth Warren’s latest “liberal” bleat, in support of Obama’s plan to soak “the rich,” has caused ripples in the blogosphere (here and here, for example). The bleat? It goes like this:

I hear all this, you know, Well, this is class warfare, this is whatever. No. There is nobody in this country who got rich on his own — nobody.

You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.

Who said anything about anyone getting rich on his own? But didn’t the factory owner — and other “malefactors of great wealth” — pay a “fair share”of the taxes that support roads, education, and police and fire forces? Yes.* Didn’t the factory owner pay his workers for their labor? Yes, and sometimes (in the case of union workers) at the expense of consumers and those workers who couldn’t find employment because unions effectively limit entry to the labor market.

If anyone owes “the rest of us” anything, it’s the workers who received subsidized educations that enabled them to earn good wages at factories that were built because factory owners, shareholders, bond holders, and (sometimes) venture capitalists put their own money at risk.

Workers and others (including Elizabeth Warren) ought to be grateful to the “malefactors of great wealth” who have — against heavy odds — enabled America’s prosperity.

Related posts:
Asymmetrical (Ideological) Warfare
“Buy Local”
Giving Back, Again
Taxing the Rich
More about Taxing the Rich
Luck-Egalitarianism and Moral Luck
Union-Busting
In Defense of Wal-Mart
Union Thuggery
__________
* Even a union-dominated  lobbying organization, Citizens for Tax Justice, acknowledges (backhandedly) that “the rich” pay their “fair share” of all taxes — federal, State, and local:

I won’t vouch for the accuracy of the numbers. But, given the source, this can be taken as a “worst case” depiction of the distribution of the total tax burden. “The rich” are paying their “fair share,” and then some, unless you believe (as leftists seem to believe) that  “the rich” are supposed to take care of everyone else.