Menu
Liberty Weeps over Ferguson and New York

Liberty Weeps over Ferguson and New York

LibertyWeeps

Last night’s decision over Eric Garner in New York after what happened in Ferguson has left the United States in more turmoil than the nation has experienced in years, maybe even decades. I tossed and turned much of the night, unable to sleep, angry and sad.  Liberty, what I hold most dear, weeps.

 

Much will be said about this over the coming years, but I believe it comes down to this. In order for people to respect the law, both the laws and those who uphold them must be respectable.

 

The law in the US is no longer worthy of respect, having criminalized human behavior to an insane degree and those who are to uphold the law have turned into a militarized force that is entirely too focused on intimidation and domination rather than “to protect and serve;” obviously this is not true for every person involved in enforcement. As I’ve mentioned in an earlier post (here), no other country incarcerates a higher percentage of its population than the United States, a dubious gold medal we’ve held since 2002. Over 7 people are incarcerated out of every 1,000. The US has about 5% of the world’s population but 25% of the entire world’s prison population!

 

While I understand the pain and frustration, the violent protests and broad accusations of racism detract from the very real issues and often harm the credibility of those accusations raises questions over their validity. We do have very real problems in the US, and it seems to me they have reached a point at which they can no longer be ignored, but history has shown that these are best resolved by principled dialogue. The US was founded on deep respect for individual rights and a passionate desire to limit the power of the government. Respect for an enforcement of individual rights by definition prohibits any racism in the law. Individuals are still free to be bigoted jerks, but no law can fix that. Only a just society can provide fertile ground for enlightenment of the ass.

 

As a nation we’ve stumbled along and not gotten things right many times, but the trajectory was at least in the right direction. We used to have credibility in our role as the global defender of liberty! We used to be a nation that fought for what was right and we weren’t so easily scared, so willing to give up responsibility for the empty promise of security. Fear has led to an increasingly militarized police force and a mind boggling expansion of what is deemed “criminal,” which has placed this insane, perverse, over-arching enforcement of “law” above basic human respect. It needs to stop, but if any nation on earth is capable of reversing this horrible course, it is America.  She can once again become the land of the free and the home of the brave.

Liberty Cannot Be Delivered at the Point of a Gun

Liberty Cannot Be Delivered at the Point of a Gun

Iraq has again descended into anarchic terror as the government  and tenuous order left in place by the US crumbles without the power of the US military behind it.  Now the US finds itself once again forced to engage in a situation that will cost dearly both in terms of actual dollars and in lives lost or at least severely damaged.  We made a mess of it and understandably the world looks to us to clean up after ourselves, regardless of the futility of the exercise.

The American Solider is to me one of the most awe inspiring images.  He/She is the defender of those who cannot defend themselves, the strong hand that reaches out and provides food, shelter, and breathtaking levels of aid during times of crisis.  He/She is the fearless defender of freedom.  Whenever I see servicemen and women I thank them for their sacrifice, for taking on risks and enduring hardships that I cannot comprehend, affording me the luxury of enjoying a life in which I only have to sweat the small stuff.  The respect they deserve demands that our military not be used so readily and with so little thought as the the endgame.

Time and time again we send our precious men and women into a nation that is suffering under a horrid despot.  We march on in fancying ourselves to be the great liberators, freeing those terrorized under barbaric rule.   It is a noble image and one that has seduced repeatedly.

The reality is something entirely different.  Democracy cannot be spread at the point of a gun.  A nation cannot be handed democracy by an occupying military force.  Liberty cannot be delivered at the point of a gun.  The love of freedom, the deep belief in the sanctity of individual rights cannot be forced upon a people, no matter how noble the intent.  It is something that must be generated from within.  It is something that must be fought for by those suffering under despotic rule and if history is any guide, it must be earned by those who seek it in bloodshed and tears.

The US seems to repeatedly stumble into foreign military messes the way Justin Bieber tweets, frequently and without much thought.

The US accounts for roughly half of the world’s military spending, yet we still don’t feel safe.  In 2013 the US accounted for about 73% of NATO’s defense spending, despite the other 27 members having collectively a larger economy than the US.

MilitarySpending

It was not the use of American military force that instilled in Soviet era Russians the desire to smoke Marlboros or wear Levis, icons of American cowboy-style independence.  The world and the United States would be better served if, rather than engaging in military conflicts that only ended up trading one set of terrorizing leaders for another, we focus on being an example of what is possible when individual rights, innovation and success are revered.  We could do much more good in the world by serving as a safe haven for those who seek to escape terror abroad, welcoming with open arms and with high expectations that those who come here, push themselves to achieve to the best of their abilities, rather than treating them and much of our existing population, like incompetent children who require a paternalistic government to manage their lives.

Inequality of Racism

Inequality of Racism

Yesterday the NBA barred Clippers owner Donald Sterling for life for the racist remarks he made in a recorded private conversation. Naturally Facebook immediately became a hotbed for inflammatory debate, much of it not worth one’s time to read as all too often in today’s society thoughtful discussion and reasoned, rational debate is replaced by verbal lashings and outlandish name-calling. That being said, underneath the often ALL CAPITALIZED rants, there are some valid frustrations concerning the inequality of racism.

A response to Donald Sterling’s remarks Monday in Charlotte, N.C., where the Miami Heat completed a sweep. Credit Streeter Lecka/Getty Images

Many argue that Sterling ought to not be castigated because there is a long list of individuals with black skin who have made outrageous, racist, bigoted, or sexist comments and have suffered little ill will from society at large, occasionally even benefiting from their disgusting rants. The fact that some people get away with wrong-doing does not mean it is no longer wrong. The NBA’s actions are not the case of the government taking away private property, using the threat of force. The NBA is a brand and Sterling simply owns a franchise. When he bought the franchise, he agreed to honor the terms of the league constitution.

A McDonald’s owner cannot damage the McDonald’s brand without consequences. The same holds true for NBA team owners. Advertisers are pulling their sponsorships and do not want their ads run during a Clippers game. That harms other NBA franchise owner’s property rights. Many individuals will no longer attend or watch Clippers games on TV. That harms the NBA brand, other owners and the players. The NBA has the right, according to their own constitution, to defend their brand.

It is true that there are many loud-mouthed pundits who abuse the very concept of racism to forward their personal agenda, which is typically perfectly aligned with the interests of their own pocketbooks. There are plenty of people of all colors who are racist, bigoted, and vile in a variety of ways. Their actions do not make Sterling’s any less vile. The woman who recorded this private conversation is awful for doing so, but again, doesn’t make what he said, or the vile things he’s done for decades acceptable.

Yes, outrage in this country can be very biased, often one sided, and that angers the hell out of me, but again, doesn’t make this acceptable. This isn’t a tit-for-tat game. It has taken the NBA entirely too long to address the vile ethics of one of their owners, but now that they are finally doing so, let’s support that decision and make it known loud and clear that such a swift response will be expected any time racism rears its ugly head, regardless of the color of the skin of the perpetrator.

America’s Foreign Foibles – rethinking foreign policy

America’s Foreign Foibles – rethinking foreign policy

The United States suffers from a significant mismatch between expectations and reality, which has up until recently been address by bureaucratic denial and protestations/assurances that if only more money/power are handed over, the dream can yet be realized.

This mismatch is possibly the greatest in the area of foreign policy. Most Americans are aware that they are incredibly fortunate to live in the United States, under the protection of the Constitution, a document which I find breathtakingly beautiful in its simplicity and respect for both the strengths and weaknesses of human nature. That awareness morphs into a desire to share our good fortune with others, to spread the ideals of democracy, liberty and respect for individual rights.

Unfortunately those beautiful and arguably noble sentiments are perverted into foreign wars and “engagements” that evolve into an attempt to spread respect for individual rights and freedoms through the barrel of a gun, a logical inconsistency that only government can tirelessly support.

A good deal of this perversion arises because anytime a politician has sufficient funds to allocate, someone will find a way to “wine and dine” them, thus foreign policy primarily serves special interests and is in practice often a far cry from the original noble intentions.

I am not advocating isolationism, but rather that American needs to appreciate the difference between being engaged in the world and being responsible for it. The former is consistent with our Constitution, respecting the rights and sovereignty of other nations and individuals. The later, while on the surface may sound admirable, is in reality closer to the bossy and invasive neighbor that chops down your favorite tree under the guise of helping you with your gardening.

America and the rest of the world would be better served if instead the nation focused internally, making itself an example of the joys and benefits of a free society. Showing the world the continually rising standards of living, the endless innovation and happiness enjoyed in a free society is our most powerful tool for global influence.

Michael Jordan and the B-Ball Inequality

Michael Jordan and the B-Ball Inequality

MKI know that this may come as a surprise to many of my regular readers, but I have a confession to make.  Michael Jordan is a better basketball player than I.  This basketball skill spread needs to be addressed. He shouldn’t be that much better than I. It isn’t fair.  No matter how much I practice, no matter what coaching I get, no matter how hard I train in the gym and follow a strictly regimented diet, he will always be better than I.  Unfortunately for Mike, the only way to address this issue, (given that there is a clear cap to my potential at 5’8″ with a proportional wingspan and at best, only slightly better than average springs) is to handicap him.  Now wouldn’t the world be a better place if the difference in our abilities were materially reduced?

You probably get where I’m going with this.  Before anyone gets into a tizzy and starts making all kinds of accusations about how mean and uncaring I am.  There is a serious problem today with respect to income, but the problem, thus the cure, isn’t what is preached in the popular media.

The billionaires at Davos, in what can only be described as irony of epic proportions, all agreed that “Severe income inequality” is one of the top 10 global risks of greatest concern for 2014.  You can read the report here.

So let’s break this problem down.  When people talk about income inequality there is a knee-jerk assumption that by definition, income inequality is bad, which in reality is quite destructive to society as a whole.  It intuitively doesn’t make sense that as a society we should strive to have income equality where regardless of what value an individual generates, income ought to be equal.  The guy who chooses to work 3 days a week sweeping floors at the local Walmart clearly should not enjoy the same income as Steve Jobs! So some degree of income inequality is Ok, right?  But not too much?  Hmmm, ok, then how much?  Who gets to decide how much is too much and how do they make that determination?  Then how do they enforce it? How do we trust that the person we give such enormous power to won’t abuse that power?  For argument’s sake let’s say they don’t.  What about their successor?  How likely is it that we continue to have only angelic geniuses that are able to manipulate society into a Utopian income spread without ever falling prey to corruption and graft?  So far the record throughout history doesn’t lead one to believe that is it all likely.

I spend a great deal of my time in Italy, where I sadly witness first-hand the awful consequences of this sort of societal structure.  If I get paid roughly the same amount whether I work my tail off and take risks trying to improve my performance or if I put in essentially the bare minimum level of effort, why try?  I see this everywhere.  Incredibly bright people who could be innovating like crazy, coming up with all kinds of solutions that would benefit their companies and eventually their nation are beaten down by a system that provides no incentive for those who really try to do something great.  Those who are naturally innovators want desperately to try new things, take risks, but for them there is only downside risk.  They can’t improve their income level through hard work and risk taking.  They only risk annoying their colleagues and supervisors by trying to improve things.  Status quo is the rational choice.  Notice the level of innovation coming out of Italy and its rate of growth!?

I sit at dinner and hear the agony in my friend’s voices as they vent their frustrations and their anger at how a colleague who does very little gets paid roughly the same as they do.  This type of structure infects relationships because it forces people to live in a lie, a lie which is painfully obvious to everyone. The guy who barely shows up to the office and only does the bare minimum knows that the guy who’s working his tail off, (he can’t help but try as innovation is in his DNA) is angry that they both get paid roughly the same.  They both are aware of the resentments, but are powerless to do anything about it because society tells them that this is a far better way to live.  It is more fair. What the hell?  More fair that those who are willing to sacrifice and take risks are basically barred from enjoying any benefit from doing so?  My Italian friends all talk wistfully about how great it would be to work in the U.S. where at least there they can hope to get rewarded for accomplishing something great.

As for the U.S., I struggle to see where this horrific trend we keep hearing about is evidenced.  The table below is from an excellent study by Alan Reynolds of the Cato Institute.  You can read the entire report here. The data does not prove out the claims, at least in the U.S..  The bottom two quartiles and the top quartile enjoyed nearly the same increase in income on a percentage basis from 1989 – 2007.  From 2007 – 2010, the bottom quartile experienced a rise in income, while all others experienced a decline.

Now where is inequality a problem?  Barriers and disincentives to improve one’s lot in life ARE problems.  Subsidies such as those in the Affordable Care Act put the poor in a veritable poverty trap in that as they work to improve their situation, the subsidies are taken away at such a pace as to make them far better off overall working less.  That is both demeaning to the individual and immoral in that it forces others to eternally be enslaved to subsidize their fellow citizen, despite the reality that the guy being subsidized may desperately want to get out of his situation, but is faced with overwhelming incentives that keep him dependent, resentful and demoralized.

There is also something horribly wrong with a system in which savers are punished through financial repression.  The Federal Reserve, by keeping interest rates low, forces savers to go into inappropriately risky investments just to try and get a reasonable return.  Those who are already wealthy and are able to invest heavily in the stock market enjoy out-sized returns courtesy of the Fed’s QEInfinity as evidenced by the 90% correlation between the Fed’s balance sheet and the stock market starting in 2008.  Previously the correlation was essentially 0!

The free market system is far from perfect, full of all kinds of flaws, but it is infinitely better than anything else out there.  There are no angelic, omniscient bureaucrats that can manipulate our world into a more Utopian state.  Be wary of any who claim they can.

Prison, it’s not the perks, it’s the population: An over-criminalization crisis

Prison, it’s not the perks, it’s the population: An over-criminalization crisis

The headlines this week have been touting how “Prison life has never been so good,” here and here. While I understand why taxpayers would be none too pleased at the idea that prisoners enjoy more daily life perks than those out earning a living every day, it isn’t the perks that are the problem. It is the massive prison population that ought to make you hopping mad.

The US has a wildly unproductive criminal justice system with a self-destructive focus on revenge-oriented judgment and entirely too many laws that permanently damage an individual’s potential for committing acts that ought never to have been considered a crime in the first place.  We have a veritable over-criminalization crisis.

No other country incarcerates a higher percentage of its population than the United States, a dubious gold medal we’ve held since 2002. Over 7 people are incarcerated out of every 1,000. The US has about 5% of the world’s population but 25% of the entire world’s prison population!

U.S. prison population is over 2.4m and has quadrupled since 1980, with the largest driver of this change being longer prison sentences for drug offenders. There is something seriously wrong with a system in which had the current President been caught smoking pot, as he admits he did in his youth, he could have been sent to prison and been unable to ever make much of his life, after being saddled with the stigma of a convict. Instead, he was one of the lucky ones who never got caught and is now arguably the most powerful person on earth. Something is very wrong with a system that would have imprisoned and effectively ruined his life, as it has so many others, even if you disagree with his political views!

Bottom Line: Prisons ought to be reserved exclusively for those who are a physical threat to society, not as a taxpayer funded form of revenge. Those who are not a physical danger to society ought to remain productive members of society and atone for their misdeeds while being an active part of the economy.

NSA Surveillance Impact Overseas

On February 10th I spoke with Neil Cavuto on how NSA surveillance affects international communications.

I work internationally, dividing my time between San Diego, California and Italy. I sometimes advise on deals that have involving high-profile, publicly traded companies and the actions my clients take are significant enough to affect the market.  Now whenever you are talking about large amounts of money, someone will always find information valuable.

So… aside from the obvious obscene Constitutional violations by the NSA, their spying has a material effect on how we now communicate, specifically on how non-American entities conduct their business with Americans and with each other. The world has been put on notice that communications, which in anyway interest the US, are subject to interception by an agency that has shown it doesn’t have its house in order and its use of that information is uncomfortably vague.
Some companies in Europe have even taken steps to ensure that their communications do not get routed through any servers that they believe the NSA may observe.  Of course we really have no idea just how pervasive the NSA’s program truly is, so an overabundance of caution is required.
So now, when I am outside the US and I send an email to the US, I have to first think of which account to send it from based on what I’m saying and whom I’m sending it to.  When placing calls from outside the US to firms with whom we work in the US, I am conscious that someone may be listening and cannot trust what they may do with what they hear.  What if I place a call from somewhere like Dubai or have a conference call on with someone from there to a financial institution in the US?  Does that raise any red flags for the NSA?  Would someone then listen to that call?  I have to think about how to protect information that cannot be released before we are ready, which adds more friction to the system. That is not exactly helpful in an economy that is struggling.  Why make it harder for us to work done?

Forget Snowden and Focus on the NSA

Forget Snowden and Focus on the NSA

The NSA works for us.  The power to govern lies with We the People and flows from us to the government, not the other way around.  The NSA does not dictate to us what the appropriate constraints on its activities ought to be.  It may suggest, but We the People decide what controls we want on our government.  When the governing violate the constraints imposed by We the People, without our knowledge, someone like Snowden needs to take the risk to let us know.

“I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them.” ~ Thomas Jefferson

2013-07-04 WhistleblowerListening to the pundits finger-wag and vilify whistle-blower Edward Snowden for the past few weeks has me in a serious lather.  I’ll admit that the recent heatwave in Genova, Italy (my part-time home along with San Diego, CA) and my upcoming trip from here to Las Vegas for FreedomFest probably has me even more fired up than normal.  You haven’t lived until you’ve had to drive in Italy in the heat.  I swear it makes an already anarchic driving society even more lunatic, but I digress.  I’m usually one to pshaw conspiracy theorists, but the vehemence of the vile attacks on Snowden’s character by those who have scant information to go on has even my eyebrows raised.  He may be an angel.  He may be a demon.  But why the hell is that even the focus?  That’s like finding the lost city of Atlantis in a tropical sea and obsessing over the clarity of your goggle lenses!

Snowden has been referred to as a “cross-dressing Little Red Riding Hood” in the Washington Post, a grandiose narcissist in the New Yorker, and Fox New analyst Ralph Peters and Donald Trump want to bring back the death penalty for Snowden.  Seriously people?  Talk about going off half-cocked and gunning for bear.

Where is the focus on the Constitutionality of the NSA’s spying?  Oh but not to fear, Jed Babbin of the American Spectator assures us that the NSA is “a whole lot more trustworthy than most of the rest of our government,” and isn’t like the IRS.  Oh that’s comforting, given the NSA’s track record.  For the love of Pete, in 1978 the Foreign Intelligence Surveillance Act was created specifically to limit the powers of the NSA after project SHAMROCK came to light, a project that Senator Frank Church claimed was, “probably the largest government interception program affecting Americans ever undertaken.”  That is until now of course.

Let’s not forget that the NSA is responsible for  the Gulf of Tonkin incident, reporting falsely that an attack had occurred on the USS Maddox, which ultimately led to the Vietnam war.  Ooops on that one too?

Now we’ve got National Intelligence Director James Clapper admitting in a letter to the Senate Intelligence Committee that his statement before Congress that the NSA did not have a policy of gathering data on millions of Americas had been “clearly erroneous”.  Right, you lied to the people you serve, but we’ll trust your judgment anyways.

A month after the Guardian broke this story, Snowden’s worst fears may be coming to pass, namely that nothing changes.  We have no Frank Church to lead the charge as he did in the 1970s, instead we have the likes of Cheney defending the NSA and calling Snowden a traitor.

The power of government must at all times be vigorously constrained because power will always end up being abused.  Perhaps we get lucky and have angels running the show for a while and we grant them all kinds of powers under the theory that they are there to protect us.  History has shown that angelic bureaucrats are a quickly fleeting dream.  Hell, if the NSA is so good at making sure this data doesn’t get into the wrong hands, how did Snowden get it?  Doesn’t look like he is exactly their poster child!

Liberty comes at a price.  Living in a society in which individuals are free to live their lives as they see fit, rather than living in a one-size-fits-all world comes at a price.  The more protection we ask for, the less freedom we have.  Keep this in mind.

“All men having power ought to be distrusted to a certain degree.” ~ James Madison

Speaking with Wealth TV on the Apple Tax Charade

Speaking with Wealth TV on the Apple Tax Charade

On May 22nd, I spoke with Graham Ledger on Wealth TV about the horrific show the Senate put on in an attempt to shame Apple for not voluntarily paying more in taxes than it required by the tax code by implying inappropriate corporate behavior.

The Daily Ledger Chewing Up Apple from One America News Network on Vimeo.

The U.S. Senate has been hosting a sham of a hearing to try and publicly berate Apple for not paying “it’s fair share” of taxes despite the reality that Apple is in full compliance with tax law. The government has not even once suggested that Apple has in any way violated the tax code.  To try and publicly shame a company that is in full compliance with the law is an embarrassment and a blight on the legitimacy of our political system.

The supposed crime is that the company has not voluntarily paid more than required by law to pay and has taken advantage of the tax code, enacted by the very group hosting this charade, to the benefit of its shareholders, employees, suppliers, and all the ancillary individuals and organizations that benefit from such a successful company. The federal government apparently would prefer that Apple voluntarily take money away from American investors, retirement funds etc and give it to the government to spend. Apple does far more good for the American economy with every dollar it generates than the federal government ever could.

Apple should not pay taxes on income generated outside of the U.S. That income is already subject to foreign taxes. It is ridiculous that the U.S. would try to argue that another sovereign charges too little in taxes, thus Apple ought to pay more.

To the extent that Apple is using the tax code in order to minimize its taxes by shifting U.S. income into foreign income, the U.S. should be taking a long, hard look at how uncompetitive the U.S. corporate tax rate has become and review the Laffer curve. By lowering the U.S. corporate tax rate, multinationals would find less value in such techniques, which would likely raise the amount of taxes collected.

I was beyond thrilled to see Rand Paul call the Senate to the floor for the atrocious nature of this hearing.

Visit NBCNews.com for breaking news, world news, and news about the economy

 

What is the proper role for government?

Only July 21st, Lenore Hawkins joined the Freedom Fighters, (Charles Payne, Ellis Henican and Kmele Foster) and on Freedom Watch to discuss the economics of electric cars, Florida selling info on citizens obtained by the DMV, the federal government’s restriction of potatoes in school lunches and the impending FAA shut down.