Star Wars and the Austrian School: Introducing Darth Plagueis

By Zach Foster

Darth Plagueis was a dark lord of the Sith so powerful and so wise, he could… even keep the ones he cared about from dying…  The dark side of the Force is a pathway to many abilities, some considered to be unnatural.  He became so powerful, the only thing he was afraid of was losing his power.

—Supreme Chancellor Palpatine, a.k.a. Darth Sidious[1]

Star Wars: Darth Plagueis book trailer (YouTube)

After much disappointment expressed by the public over the quality and substance of the Prequel Trilogy—grudgingly accepted by diehard fans—comes a novel to save the day and save the prequels, especially Episodes I and II.  James Luceno’s Darth Plagueis excellently brings together the seemingly scattered events of the prequels to not only tie up loose ends, but also offers greater understanding of these films and a greater appreciation of the Star Wars storyline.  Better yet, Darth Plagueis is a novel that could speak volumes on behalf of the Austrian School!

Let it be clear that this is unlike most Star Wars novels.  It isn’t action-packed, but rather philosophical, explaining the teachings of the Sith, the logic for and against the Rule of Two, and the Grand Plan for the revenge of the Sith.  Much like The Count of Monte Christo, Darth Plagueis uses politics, deception, and intrigue to move the plot forward over a chronological span of several decades.

The novel also answers some pressing questions, including why Darth Maul was killed by a padawan and not a Jedi Master.  Another is how and where Count Dooku came into the picture, his frustrations with the weakening Republic, how he would have become a Sith Lord, and why Dark Jedi are leaping out of every nook and cranny while the Rule of Two is still in effect.  Some of the glimpses of the growing military industrial complex give insights on the development of the technology used by the Trade Federation, the Intergalactic Banking Clan, and the Techno Union which not only would make the droid army possible, but also the cyborg technology used to revive General Grievous and eventually Darth Vader.   The novel even covers the open ends made in The Clone Wars series, including Darth Maul having a brother and a psycho godmother.

Rest assured that this article contains some major spoilers, but critical for the brief analysis that must be included in this book review.  Darth Plagueis, known to his business associates as Hego Damask, is a seldom-known figure who mostly operates and does his transactions behind closed doors and out of the limelight, yet is one of the most powerful beings in the galaxy.  He is personally responsible for setting in motion the chain of events that would lead to the rise of the Empire under Palpatine.

Damask, Majister (both CEO and head of state) of the clandestine financial group Damask Holdings, follows the Muun species’ tradition of banking, finance, and acquisition of as much power as possible through the purchasing or seizure of assets, from accounts and properties to big businesses and even whole planets.

Damask is a secret ally of the Intergalactic Banking Clan (the Star Wars version of the Federal Reserve), responsible not only for growing the military industrial complex, instigating the breakup of the Republic and the rise of the Empire, but also for selling weapons and financing both sides in the Clone Wars.  One of the members of Damask Holdings, Larsh Hill, is Chairman of the IBC and will eventually be succeeded by his son San (seen in Episodes II and III as IBC Chairman and influential leader in Dooku’s Confederacy of Independent Systems).  After Larsh’s death, San Hill would be personally mentored by Hego Damask.

Wookieepedia—now recognized as a reliable authority by StarWars.com—says the following about Damask Holdings:[2]

Damask Holdings was a clandestine financial group closely allied to the Intergalactic Banking Clan, which also acted as a lobbying and political pressure organization that involved itself in the affairs of many planets, both to exploit local resources—such as plasma—for financial gain, and to gain influence on a galactic scale as part of the secret Sith Grand Plan to topple the Galactic Republic. It also operated as a secret society, bringing together the galaxy’s most influential beings for the yearly gatherings on Sojourn, and also presiding over the steering committee.

Case closed!  If Hego Damask can be compared to J.P. Morgan, then the Hills are the Rockefellers, the world Sojourn being Jekyll Island[3] and Damask Holdings being the first Federal Reserve Board, using the IBC and satellite firms like the Trade Federation to tighten their hold over the Republic, secure a future for the military industrial complex, and maintain their full monopoly on the control of trade, finance, and unbalanced government regulations.

Star Wars: Darth Plagueis artworkDamask, however, is much shrewder in his schemes and dealings than J.P. Morgan, though Morgan’s co-founding of the Fed and agitation to involve the United States in the First World War (to protect his European investments) makes him no amateur thug.  Damask recruits as his Sith apprentice an ambitious young man from Naboo named Palpatine, simultaneously training him in the ways of the dark side of the Force and grooming him to become an influential Galactic Senator.  Their methods are to acquire all the power necessary for undermining the Republic, Damask’s grand plan involving Palpatine acquiring political power and the reins of government, meanwhile himself acquiring increasing economic power through Damask Holdings and the IBC.  Furthermore, Damask obsessively studies the nature of life, the Force, and Midi-chlorians in the hopes of achieving immortality so that Plagueis and Sidious may forever reign as emperors.

This example is part of why your author respectfully disagrees with the neo-Rothbardian view that government is evil and everything that is good lies in privatization.  (No, this is not because Rothbard hated Star Wars…)  After all, it’s possible for thugs to control whole sections of the private sector and rule as dictators in an anarcho-capitalist society just like the public sector in a socialistic society, whereas in a Constitutional society with minimal, localized government and abundant, decentralized privatization there lies far less opportunity for the stripping of rights and increase of corruption through monopolies and absolute power.

Nonetheless, we live in a world where the same group of thugs seem to rule large sections of both the public and private sectors, just as the Order of the Sith Lords secretly does during the final years of the Republic.  The worldview of the Sith Lords is not different at all from the one held by contemporary policy makers in America, from the Federal Reserve Board of Governors to the U.S. Congress and the Executive Branch, their thoughts and actions completely antithetical to the ideals and principles of the Constitution, the free market, and individual liberty.  During training Plagueis says to Sidious, “With the Republic [the Jedi] are like indulgent parents, allowing their offspring to experiment with choices without consequence, and supporting wrong-headedness merely for the sake of maintaining family unity… When instead they should be claiming: We know what’s best for you.”[4]


[1] Star Wars Episode III: Revenge of the Sith

[2] “Damask Holdings.”  Wookieepedia. <http://starwars.wikia.com/wiki/Damask_Holdings>

[3] Rothbard, Murray N.  The Origins of the Federal Reserve. The Ludwig von Mises Institute. 2009. p. 93. <http://mises.org/document/6119/The-Origins-of-the-Federal-Reserve>

[4] Luceno, James. Star Wars: Darth Plaqueis. Del Rey, Random House Publishing Group. 2012. pp. 166-67.

This Is Why Regulations Are a Scam!

There are times when pure theory becomes too abstract for a student of the Austrian School, and concrete examples are needed to solidify understanding of the stupid greed or false philanthropy of policy makers who seek to “protect” the American people.  Well, see the info-graphic above!

Here’s a graph showing just a taste of the overlap between Goldman Sachs corporate lobbyists/officials and federal government officials.  Remember folks, these are the people writing regulations to reign in those “greedy capitalists”—i.e., their competitors.

Instead of competing to produce the best goods or services to win over consumers, they’re using the law in an unconstitutional manner to give themselves an artificial advantage and fat profits and slant the playing field for everyone else.

Under a truly free market, they would have to compete honestly.  The naturally occurring phenomenon of the truly free market would require them to offer goods or services of the highest quality—with a correspondingly high price—or of the lowest price—with correspondingly low quality—or find a healthy balance between quality and low price that makes goods and services universally affordable and with good utility.

One economic insight to keep in mind this election cycle is that both Barack Obama and Mitt Romney are in the pockets of Goldman Sachs, both having received substantial donations from members of the Goldman Sachs executive board.  Ron Paul is not in anyone’s pocket, disavows crony capitalism, and is Washington D.C.’s greatest advocate of the free market.

One of the problems in the common mindset is that people see crony capitalism and grievously mistake it for the free market.  Clearly there is a difference; the former, wedded to interventionism and eventually socialism, causes society and economy to decay, while the latter enables them to thrive.

Graphic courtesy of AgainstCronyCapitalism.org.

Star Wars and the Austrian School: Trade Routes (Part 2)

Continued from Part I: The Great Hyperspace War

Part II: The Invasion of Naboo

Star Wars and the Austrian SchoolFor those less-than-diehard Star Wars fans who insist that anything not in the six movies doesn’t count, they can witness this political-economic travesty of protectionism in Episode I: The Phantom Menace.  Because of a dispute over the taxation of trade routes to other star systems, the Trade Federation launches a blockade of the planet Naboo.  When the Jedi knights Qui-Gon Jinn and Obi-Wan Kenobi are sent to negotiate a settlement with the Trade Federation’s Viceroy, their diplomatic mission is simply to settle the issue but not to open the blockade, which, according to the Viceroy, is “perfectly legal.”  The notable Austrian school economist Mark Thornton makes an excellent political-economic analysis of the Trade Federation’s aggression against the Naboo:

Lucas sends a clear message that the Federation agreement with the corrupt Republic is based on the model of British Imperialism by filling the movie with historical imagery. The Federation is British Imperialism in the form of the East India Company, which controlled and taxed the British possession of the Indian sub-continent. Of course, entrepreneurs complained and evaded British taxes and regulations, but the British Empire gave out monopoly rights to control India and other colonial trading rights in return for tax revenue.

Yet the real clincher that the Federation was based on British Imperialism lies in the title of the local leader of the Federation blockade and the one who will rule the planet for the Federation-Republican alliance—Viceroy.

Viceroy is of course the British title for colonial leader. British imperialism was largely based on the “company model” where a company, like the British East India Company would be formed and given exclusive trading privileges. The government would get revenue and their proverbial foot in the door in exchange for the monopoly. Later, Britain would provide troops and other means of support and eventually take over the colony from the company once the profitability had been proven and English-rule had been established.

The main difference between the British  invasion and subjugation of India and the Trade Federation’s blockade and invasion of Naboo (with the end result of forcing Queen Amidala to sign an unbalanced treaty favoring the Federation) is that the former was a move of aggression by an empire against a sovereign people, whereas the latter is an act of aggression by one member entity of the Republic (the Federation has representation in the Galactic Republic Senate) against another Republic member world, Naboo.

Furthermore, the Battle of Naboo was a great victory for the Naboo/Gungan alliance against the Trade Federation invaders and their battle droid army, but the Indian Rebellion of 1857 against the British East India Company’s administration was suppressed, resulting in total domination by the British Crown. (Until the British government assumed full control over India, this once-proud empire and various autonomous states were ruled by a corporation which was merely sanctioned by the government; corporate welfare at its worst!)  The Indian people would not regain independence until a war veteran and Imperial patriot-turned pacifist nationalist by the name of Gandhi led a movement of civil disobedience that culminated in independence and catalyzed the British Empire’s dissolution.

Returning to Star Wars, crony capitalism and corporate welfare were rampant in the Republic, even to the disgusting culmination of the Trade Federation—a commercial venture—having its own representation in the Galactic Senate!  It’s one thing for the senators of certain worlds to represent their planets, which may or may not do business with the Federation, and vote according to the economic interests of their constituents, but it’s a completely different story when corporations have their own Senators.  Can anyone imagine Senators and Representatives from Halliburton and Goldmann Sachs strong-arming their counterparts from the states of Arizona or Iowa and wreaking unchecked havoc on Capitol Hill?  This was certainly the case in Star Wars, and the Trade Federation representatives did everything they could to silence Queen Amidala’s plea to the Senate, to end the blockade and invasion, by proposing “investigative” committees wrapped in miles of bureaucratic red tape.

Some might ask why they would do this.  Why would businesses commit such crimes?  Whether it’s the U.S. Congress heavily taxing imported goods to “protect the American economy,” or the British East India Company and its mercenaries invading and colonizing India, or the Trade Federation launching a blockade of Naboo to resolve the dispute over taxation of trade routes in their own favor, crony capitalism is a disease born from greed and laziness but whose epidemic expansion is catalyzed by government intervention, namely in the form of unbalanced protectionism (as if there’s any other kind!) and regulations (there’s always a loophole that favors the “regulated” industry as long as lobbyists in the capital).

Most people are naturally greedy, but the free market forces them to channel their greed towards production of the best and/or lowest priced consumer goods and services, lest they be forced out of the market.  Even these greedy people are forced to work hard nonstop, always planning, strategizing, and innovating in order to come up with new and better ways to serve consumers and ultimately make life better for society, or else they are rejected by the consumer base and go out of business.

Unfortunately, it’s a lot easier to be lazy and use mafia tactics to drive foreign producers out of the domestic market and slam the door in the face of new entrepreneurs (all of these enabling bad businesses to charge high prices for cheap goods) than it is for producers to gird up their loins for the ceaseless competition of innovation and service that the free market demands.

Despite the “best intentions” of legislators, regulations will always favor some corrupt corporate entity because of all the lobbyists in government, whereas the free market naturally imposes survival of the fittest on the businessman and will eventually punish crooked business practices (case in point: had Wall Street not been bailed out by government, those crooked businesses would have been wiped out and new and honest blood would have stepped in to serve clients).  Therefore, crooked businesses are a mafia, the Federal Reserve being the public loan shark which debases the currency and finances predatory loans, and the government—despite the best of intentions—ultimately acts as the enforcer for the mob and its loan shark.  Pray, if we only had Jedi knights with lightsabers willing to cut their way into the Fed to force an audit!

Neither the United States nor the Galactic Republic enjoy the benefits of a fully free market, and in the face of economically-driven state terrorism, it’s up to citizens clinging to God and their guns to solve problems and fight against the desecration of their Constitution.  The Naboo/Gungan alliance did just that.  Had they failed to liberate their world, the Federation would have ruled their planet and the Viceroy’s one-sided treaty would have been signed by Queen Amidala at gunpoint, making the invasion and subjugation of Naboo legal.  Corporate welfare within the Republic would have evolved to new heights, with the conquest of sovereign worlds by corporations and their private armies becoming the norm.

Let no one forget that corporate welfare is antithetical to the free market and its natural ability to raise the standard of living for all people.  Crony capitalism is phony capitalism.

[Originally published by Young Americans for Liberty]

Images by the author; compiled from various explicitly public domain photos from the Wikimedia Commons.

Star Wars and the Austrian School: Trade Routes (Part 1)

Originally published by Young Americans for Liberty

Part I: The Great Hyperspace War

Star Wars and the Austrian School: Trade Routes Part 1For those knowledgeable nerds who are well-versed in Star Wars expanded universe history (such as your author), they would be familiar with the lore of the Great Hyperspace War.  Originally appearing in the Tales of the Jedi comic book series and being mentioned throughout the Knights of the Old Republic game, this particular conflict is part of ancient Star Wars history, having been fought five thousand years before the time of Luke Skywalker.

This conflict began when some gold diggers waist-deep in debt decided to try their luck at finding new paths for hyperspace travel that could become lucrative trade routes and solve their financial woes.  What originally happened was that, after dialing random coordinates and hoping to get lucky, the traveling pair of get-rich-quick schemers accidentally stumbled upon the Sith planet of Korriban and the entire Sith Empire, previously ignorant of the existence of the Galactic Republic and vice versa.

This immediately led to the Sith using the newly-discovered hyperspace route (and subsequently discovered coordinates) to attack Republic worlds.  For the rest of the war, the Republic and the Sith Empire struggled for domination of the hyperspace routes while trying to conquer each other’s’ worlds for imperial expansion.  The Republic eventually won, resulting in the near-annihilation of the Sith Empire and the exile of the Sith Lord Naga Sadow to the planet Yavin 4, but this would only be one in a series of wars between the Republic with its light-side Jedi and the Sith with their dark Jedi.

These episodes are not unlike ancient history here on earth.  The Punic Wars, fought between the Greek Carthaginians and the Romans between 264 and 146 BC (nearly one hundred and twenty years!) were waged specifically for land holdings, particularly islands in the Mediterranean, and for control of waterways for trade routes.  Furthermore, long before Rome fought Carthage, the Trojan War became the stuff of legends.  While mythology romanticizes the war to have been fought over a beautiful woman, historians and archaeologists today agree that the most likely cause for the war would have been trade routes.

Austrian economists know that all such calamity and bloodshed could have been avoided through economic cooperation rather than isolationism.  Just because countries or empires trade with each other does not guarantee that they don’t adopt isolationist measures.  Whether it’s the Greeks battling the Romans or the British battling the French, it seems impossible for nations to simply share the waterways.  After all, 75% of planet Earth is covered by ocean, and there’s enough water on the well-traveled trade routes for ships not to crash into each other.  Still, with the existence of empires comes the need for as much prestige and as many displays of dominance as possible.  The “chosen” empire must have full control of the trade routes and take the liberty to tax any vessel and cargo, leaving little if any market competition.

Even when not trying to dominate a market competitor militarily, international competitors still try to dominate the market through protectionist laws, tariffs, and other taxes.  Unfortunately, such a travesty is all too common today.  In order to “protect” American industry, big businesses lobby the federal government to set high tariffs and fees on imported goods.  This invariably makes the price of imported goods shoot sky high, since the foreign producers now have to pay the exorbitant tax on top of the cost of shipping their products internationally.  While this maintains the illusion of protecting the American economy, it causes more harm than good.  Because the market has been violated by protectionist interventionism, prices are raised artificially (but the higher cost for goods and services is all too real for the poor consumer whose purchasing power is shrinking).  These high prices naturally serve as false indicators in the market and cause domestic producers to raise their prices as such.

These phony prices in no way indicate the actual cost of producing the goods, the way a free market would allow, and manipulating the prices for protectionist purposes harms consumers by making goods more expensive.  The quality of products also drops because domestic producers no longer have to constantly compete with their foreign competitors.  In the end, the American consumer is paying more money for lower quality goods, not necessarily because of some “greedy capitalist” but because government intervention enabled that greed.  The free market is about competition and survival of the fittest, in order to provide the consumer with the best quality product for the lowest possible price.  Author Kel Kelly writes in his book The Case for Legalizing Capitalism, “Don’t buy American, buy what’s best…”:

Intentionally buying only American goods when one would otherwise choose foreign products keeps American workers employed—temporarily—in jobs where they are producing goods which should be produced by other countries, while their labor would be more beneficial in another line of work. Because of this, there are fewer total goods produced and lower real salaries for both the laborers and the consumers.

 To elaborate on Kelly’s point, consumers tend to buy more expensive and lower quality products far less often.  This leads to an overall decline in revenue for producers, causing them either to go under, or to prevent going under by having to cut their budget through cutting all workers’ hours or by eliminating jobs (in which labor is being wasted when other countries should be producing those items so that local labor can better produce other items).

For those less-than-diehard Star Wars fans who insist that anything not in the six movies doesn’t count, they can witness this political-economic travesty of protectionism in Episode I: The Phantom Menace.

Continued in Part II: The Invasion of Naboo

Image by the author. Background taken from a NASA photo which is in the public domain.

Star Wars and the Austrian School: A Brief Overview

This article was originally published by Young Americans for Liberty

Star Wars and the Austrian SchoolStar Wars is unquestionably a brilliant saga that touches the hearts of many through its incorporation of timeless literary archetypes and humanist themes.  Adventure, love, loss, spirituality, good vs. evil, and the triumph of the human (and humanoid) spirit…

Yet there are other characteristics standing out that demand attention and respect, such as the saga’s inclusion of patterns of history (great wars and economic or political disasters) and of the interactions and exchanges of societies and individuals.  One could practically point to passages from Mises’ Human Action or Theory and History while watching any given Star Wars episode!

Everyone knows the basic storyline that spans six episodes and numerous television and novel tie-ins.  A once prosperous and peaceful republic decays over time from corruption and then war.  Victory over secessionists in a great galactic war only serves to undermine the Republic’s ideals of liberty and hastens its demise and overt reorganization into the Galactic Empire.  Following two decades of imperial rule and repression, a guerrilla army dedicated to reestablishing the Republic and maintaining its founding principles of liberty fights a lengthy campaign, pursuing only the help of willing parties, eventually destroying the Empire and restoring republican democracy to the galaxy.

While the whole republican democracy vs. imperial rule theme is incredibly broad and universal, there are a number of factors that tug on the heart strings of any Austrian economists.  The saga begins with the Trade Federation, involved in a dispute over taxing trade routes, launching a blockade of the planet Naboo.  This is unquestionably an aggressive action inflicted on a sovereign people for the purpose of maintaining protectionist taxes and other economic interventionism—a crime not only against a sovereign people but also a violation of the free market.

Throughout the Clone Wars, part of the C.I.S. (Separatist) war effort is paid for by Trade Federation revenues, as well as profits generated by the Intergalactic Banking Clan (secretly controlled by the emperor-to-be Palpatine).  Can anyone say Intergalactic Federal Reserve?  At the same time, the Republic’s war effort is paid for by inflation by its own central bank, and probably also by raising taxes on Republic member worlds.

The end of the Clone Wars is met the rise of the Empire and Darth Vader—warnings of what happens when great leaders and great societies sacrifice their principles under an end-justifies-the-means mentality and invariably become what they originally set out to fight against.  In order to carry out the Wilsonian fantasy of “making the world [err, galaxy] safe for democracy” the Republic had to become an Empire, a threshold from which there was no return.

Then comes the Rebel Alliance, a coalition resembling that of thirteen autonomous states during the American Revolutionary War, fighting the Empire so that the Republic and its Constitution could be restored.  This Republic would be one that respects individual rights and the self-determination of worlds.  What did the Rebels give to the galaxy? “A republic, if you can keep it” (Benjamin Franklin).

Across the journey the audience is introduced to fascinating commercial centers.  Two such places, radically different from each other, are Coruscant and Tatooine.  Corsuscant and its booming skyscrapers represent the hustle and bustle of Wall Street, while the desert spaceports of Tatooine are a haven for the black market—some would call the black market the free market.  Whatever drugs, technology, equipment, and other goods are off the market where the Republic  rigidly enforces its prohibitionist and protectionist laws can easily be obtained in the unregulated bazaars of Tatooine—for the right price of course.  There’s a whole galaxy thriving with exchanges and movement and all sorts of human and humanoid action to explore!

Let this serve as an introduction to a series of glimpses into the Star Wars universe through the eyes of an Austrian economist.  Feel free to come along for the ride, and may the Force be with you.

[View the original publication]

Image edited by Zach Foster. Background taken from a U.S. government photo and in the public domain.

Support Our Troops: The Hypocrisy of So-Called Patriots

This article was also seen in The Political Spectrum and the Daily Paul.

Ron Paul received the most military donationsMany conservatives at this stage of the campaign cycle agree that they like the majority of Ron Paul’s platform, yet they disagree with him completely on foreign policy. Some of them periodically muster the courage to call his foreign policy naïve.  Those who dislike him completely will condescendingly call him a lunatic in the face of anyone they suspect to be a Ron Paul supporter.  These “enlightened” conservatives are so self-righteous and wrapped up in their elevated opinion of their star-spangled selves—and their preferred flip-flopping candidate—that their opinion on maintaining the militarist status quo, infallible as they see it, is so correct that it doesn’t even warrant an intellectual defense, least of all to those no-good dumb-dumb “Paulbots.”  Periodically however, there arise a few who have a sense of honor and decency that are willing to at least defend their ideas with a logical argument.  All of the above, though, are people who claim to “support the troops.”

In light of their claim, it is necessary to analyze who the troops themselves are supporting.  The easiest way to find out is not by straw polls, which can be faulty at times when considering the participating sample of the population, but rather by looking at the way the troops are literally putting their money where their mouth is. As of September 30, 2011 President Obama has received over $68,000 in monetary campaign donations from active duty troops.  The candidate trailing him is Mitt Romney with a distant $11,000, and for the rest of the candidates the numbers only go down from there.  All of their donations from the troops combined with Obama’s come out to $106,266.  Many of these Republican military donors would be content to vote for any Republican candidate in November 2012 just to get rid of our incumbent President.

And now for the pressing question: How much money has Congressman Paul raised from active duty troops?  $112,739, not counting the various money bombs that would come in October and November. The numbers clearly show that Ron Paul garnishes more support from America’s fighting sons and daughters—the true patriots who currently risk life and limb for the country—than all of the opposition combined.  No one is in a position to be more fully and painfully aware of the consequences of America’s militant foreign policy than those troops whose job it is to literally fight wars and terrorism, as well as “keep the peace” around the world.  The vast majority of troops—endangered enough by foolish civilian policy makers that they awoke and joined the political process—clearly wish to abide by the noninterventionist (not isolationist) foreign policy of George Washington and Thomas Jefferson.

Yet the so-called “patriots” who disagree with and/or scorn Paul’s noninterventionist ideas are convinced that he is incorrect, naïve, or just plain crazy. These are the people who most ardently proclaim their support for the troops, yet by writing off Dr. Paul’s idea of bringing the troops home from around the world they also write off the opinions and experience-based beliefs of the very troops they claim to support. These warhawks all have one thing in common: their idea of “supporting our troops” rests with slapping a yellow bumper sticker on their car and occasionally sending a box of cookies to Kandahar Airfield rather than actually heeding the passionate cries from those who wear the uniform and bleed for the stars and stripes.  This is the ultimate form of hypocrisy for so-called patriots and it is unacceptable.  Every servicemember as well as discharged veterans from the decade-long war on terror ought to call these warhawks on their sickening hypocrisy.

Perhaps the most hardline warhawks will never be able to change their minds; they have already drunk the kool aid of staunch ultraconservatism and are long gone. However, this is not true for the majority of conservatives who are intelligent critical thinkers.  After all, they love Ron Paul’s non-socialist economic and domestic policies, yet they disagree with his foreign policies. They also claim that they support the troops, regardless of the overbearing contradiction in their words and logic.  The day these conservatives will truly demonstrate their support for America’s military heroes will be the day they honestly listen to them and vote for the man the troops overwhelmingly champion: Ron Paul.

Grass roots image courtesy of the Daily Paul.

A Brief Statement on Labor Unions

Originally published to The Political Spectrum in April 2011.

Wisconsin protest, Feb 2011. Photo by Justin Ormont.

Civil liberties were assaulted in Wisconsin with the union busting legislation that passed despite epic protests.  At this point the purpose of the bill, the organizations it targeted, and the motives for the assault are irrelevant.  The author will write analyze them in writing later on.  The purpose of this statement is to decry the great tragedy which occurred and spawned other tragedies in quick succession. Why would the ultraconservatives want to break the unions?  Their political camp and its motives more and more resemble the totalitarianism of State Socialism.  Capitalism with minimal regulation is vital to a free and prosperous economy, and labor unions are an essential mechanism in the labor world.  By no means should labor unions dominate industries, but they should merely influence them and be allowed to do so without the dead weight of government crushing civil liberties.

The late and great Senator Barry Goldwater wrote in his book The Conscience of a Conservative that labor unions and politics do not belong together at all and should not be combined.  He writes:

“I believe that unionism, kept within its proper and natural bounds, accomplishes a positive good for the country.  Unions can be an instrument for achieving economic justice for the working man.  Moreover, they are an alternative to, and thus discourage State Socialism.  Most important of all, they are an expression of freedom.  Trade unions properly conceived, is an expression of man’s inalienable right to associate with other men for the achievement of legitimate objectives.”

In that chapter, Goldwater denounces both big government intruding on the worker’s right to free association and the large unions with political power that begin to resemble a second government behemoth.  The only relationship labor unions should have with government is a symbiotic one in which the legislature sets the standards for what is illegal in the work place (via a law) while the unions decide what is unjust in the work place, and then they petition employers with their grievances.  If the result is unsatisfactory, policy is likely to change as union members—workers representing themselves and their own individual interests—take their grievances to the voting booth in the next election.  Government should not interfere with unions (unless a law is explicitly being broken) and unions should by no means get involved with politics.

Particular unions should be opposed when they begin to cripple the industry whose workers they represent.  It is fully acceptable to fight for workers to have a work day not unreasonably long, for livable wages, and certain benefits.  However, there is a certain point where the benefits need to end, such as wages that are too high, both for the skill level of the labor being paid for and the employer’s ability to pay.  While there are certainly big businesses and executives out there that truly are greedy and pay the absolute minimum they can get away with (such as the now bankrupt and lawsuit-plagued Hollywood Entertainment Corporation, host of Movie Gallery, Hollywood Video, and Game Crazy stores), most employers are reasonable employers and the wages they pay reflect both the skill level of the labor being hired and the amount that the employer is able to spend.

Senator Barry Goldwater. Photo by Marion S. Trikosko.

If a union pressures and strong arms a small business owner (or even a large corporation) to pay janitors and cashiers $15.00 an hour with full benefits, or for middle management secretaries to be paid $200,000 a year, then the business will be unreasonable burdened.  At this point an employer has three options: dramatically raise prices, hurting the clientele and customers; cut back many hours or even lay off workers; or simply go out of business because the cost of running a business are too high.  The latter hurts the economy, the employer, and the very workers the big union claims to represent, and by this time the union acts as a second government and the union leaders are bureaucrats, businessmen, and politicians all in
one.  Despite the behemoth nature of big unions, most unions are very productive organizations run by honorable people—workers themselves—that simply aim to boost the quality of life for workers without harming industry or the economy.

It is a travesty that big government steps in and violates the rights of citizens to freely associate and do business.  It is normal for Democrats and even Socialists to advocate government as a remedy for every ill, but for Republicans—the party of less government—to advocate government interference in matters where it does not yet belong (after all, no laws have been broken) is a travesty.  Another tragedy spawned by government violating the rights of Americans is that those who feel violated by the Republican Party flee to the Democratic Party—the party of more government—for solace.  Worse yet, some of the disgruntled Americans tune into the flawed Socialist/Communist “class consciousness” of oppressed labor and of class struggle (class warfare).

Again, these remarks are theoretical, and the author will analyze the circumstances of the Wisconsin debacle later.  In the meantime, let us as Americans take Barry Goldwater’s advice and not disrupt people’s political freedom, economic freedom, and freedom of association.  Government should only bother businesses when they break the law just like it should only bother unions when they break the law.  Also, just as “too-big-to-fail” businesses do in fact fail, large, saturated, and out-of-touch unions should be allowed to fail also—free of bureaucracy.

Wisconsin photo used via Creative Commons Attribution License 3.0. Goldwater photo is in the public domain.  Both were obtained from Wikimedia Commons.

Buy American Only? A Letter From a Concerned Citizen

By Zach Foster. A response to an email letter.  This article originally appeared on The Political Spectrum blog.

"Buy Government Bonds" posterDear [friend], thank you so much for writing to me with your concerns.  I happen to share your deep concern for the fate of working class America, especially since the recession (which I justifiably call the Second Great Depression) has fallen the hardest on the backs of the working poor and the middle classes.

I’m also concerned with the fact that so many of our products come from China and other overseas producers.  Unfortunately, this is not necessarily the fault of American producers but rather that of government intervention in the economy.

What I’m about to say to you might seem a little crazy, but I urge you to bear with me.

The Myth of Protecting American Industry

Buying American products alone will do nothing to restore our economy, nor will it bring production and jobs back to the country.  Instead, what this does is actually raise prices and diminish the quality of domestic products, since producers now know that they have American buyers captive and no longer need to make the best products; they know that the law is on their side.

When I say that I’m all for free market capitalism, it means that the market needs to be truly free and unrestrained in order for consumer sovereignty to take place.  By consumer sovereignty, I refer to the old notion that “the consumer is king” or “the customer is always right”, and according to this ideology, producers who want to get rich know that the only HONEST way to do this is to produce the BEST QUALITY goods at the LOWEST COST and sell them at the lowest possible price.  This is how hard-working Americans have been getting rich for centuries.

Unfortunately, there are those who have found easy ways to get rich through the evils of government intervention.  I’ll explain this momentarily.

There have been periods in American history where there were high tariffs on imported goods (and some of these taxes still exist) which were meant to improve conditions for American businesses and consumers, but instead made things worse.  The free market is all about competition, and tariffs are essentially meant to kill competition.  Not only do tariffs on imports cause many American producers to lose their incentive to produce high quality goods at low prices (because without the competition they know they have their consumers by the throat), but often times foreign countries retaliate.  Because our high taxes make it harder for them to sell their countries’ products in America, they in turn set super high tariffs to punish American producers.  Therefore, the quality of goods produced at home goes down, the prices of those low-quality goods goes up, and the quality of foreign goods which are often good quality is now super high.

Interventionism

This happened during the Great Depression, and both the Hoover and Roosevelt administrations have blood on their hands.  Both administrations, among many other anti-free market crimes, dramatically raised tariffs on foreign goods under the myth that it would boost American industry.  They also set minimum wage laws that were meant to protect incomes.  Well, guess what the tariffs DIDN’T do for our economy and job creation, and guess how foreign countries reacted to them.  Regarding the minimum wage laws, they made production more expensive and unmaintainable for producers, so instead of only having some pay cuts, they ended up having to lay off workers or just went under completely, resulting in the laying off of all workers.  Furthermore, small and medium-sized employers were no longer able to afford to hire people because they couldn’t pay X dollars per hour as required by law.  Removing the regulations and interventionist measures that strangle industry will ultimately make it less expensive to create jobs in America, and jobs will migrate back from the third world.

Because of the government stepping in to be the hero, business growth is stunted, and that stunted growth also stunts job creation, and things are more expensive for everyone.  Many big businesses will send lobbyists to the federal government because most of this is EXACTLY what they want.  They want to be able to charge higher prices for cheaply produced goods, and they want no foreign competition, especially not from foreigners who are probably making things better and selling them cheaper.  The one thing these greedy businesses DON’T see is that, while they’ll make a profit from their captive consumers in the short run, everyone gets poor in the long run and these businesses fail and end up having to be bailed out by the federal government. This is not what the free market ever intended.

For more on the evils of regulation, you can check out Frederic Bastiat’s book The Law, which talks about how government intervention and regulation empowers the two main forms of plunder: stupid greed and false philanthropy.  The producers getting lazy on the quality of their products because people can only afford to buy American falls under stupid greed.  The regulations and minimum wage laws and “job creation” bills, “consumer protection” bills, etc., fall under false philanthropy.  You can also see chapter 18 of Jeffery Tucker’s book Bourbon For Breakfast (chapter titled “How Free is the Free Market?”).  I also HIGHLY recommend chapters 1 and 2 of Kel Kelly’s book The Case For Legalizing Capitalism, which fully explain the consequences of government intervention on stateside producers as well as international trade (and this book is a lot of fun to read and easy to understand).  All three books can be downloaded in full and for free at Mises.org/books.

Bailouts

Photo of a long bread line during the Great DepressionThis gets me to the subject of bailouts.  The big bailouts that took place in 2008 and 2009 completely outraged the majority of the American people.  These bailouts were also a crime against the free market and against capitalism.  The whole concept of pure, untainted free market capitalism is that a business has to work hard to compete with other businesses and provide its goods and services at the best quality and lowest price.  This is one reason why McDonalds and Taco Bell, who have very low-priced value menus with a wide variety of choices, have done a lot better than other higher-priced fast food chains who have had to close down many locations.  This is also why Borders, who didn’t cater to the consumer demand for e-reader books (Kindle, Nook, iPad, etc.), is going out of business, whereas Barnes and Noble, who did cater to that demand, is still in business, and why Honda and Toyota’s low-priced, superior quality cars are outselling Ford while General Motors had to be bailed out.

Businesses that fail need to be allowed to fail once and for all, which weeds out the bad elements of industry and allows room for new contenders (small and medium-sized businesses or new entrepreneurs) to try their luck at meeting the un-met consumer demands.  When big businesses fail and lay off their workers, these new contenders will be the ones to hire the laid off working people, and if the new blood meets consumer demand, then they will succeed.

Thomas Woods, the author of The Politically Incorrect Guide to American History, wrote a fantastic book called Meltdown, which analyzes the Great Depression, the current recession, and vindicates free market capitalism from the lies of the statists and interventionists.  The truth is that when the federal government bailed out all those failed banks in 08-09, as well as parts of the auto and housing industry, they gave these failed businesses a “second chance” which will only postpone another inevitable collapse.  This is like an angry and heartbroken wife, whose husband was cheating on her, giving that husband a “second chance” in which he doesn’t have to shape up but instead can keep cheating on her until he gets caught again.

The Fed

These bailouts, which only punished the American people and the big and small businesses who were doing the right thing, and rewarded the failure of the businesses who were doing the wrong thing.  These bailouts were financed by the Federal Reserve System, which is a quasi-government organization that is basically in charge of big banks (Wells Fargo, Chase, Citibank, etc.) and financial organizations (AIG, Fannie Mae and Freddie Mac, etc.).  Banks are businesses, not storage lockers for money, and rather than letting these businesses try to figure out how to meet the demands of their clients, the Federal Reserve tells them how much to hold in the vaults, how much to lend, and how much to invest.  The Federal Reserve also has the power to print as much money as it wants, which is obviously bad because the more money that is being printed means inflation goes up.

Before the Federal Reserve, there was a U.S. Central bank which was on a gold standard.  The gold standard means that every paper dollar printed needs to have an actual gold dollar that exists somewhere in a bank.  Gold is real money and paper is just an I.O.U.  This was alright though, because with real gold backing up the I.O.U., people had faith in the paper, and they used it for everyday buying and selling.  Even if the central bank used a fractional gold reserve (for every gold dollar there is, they print two or three or four), there was at least SOMETHING partially backing up the paper money.  Nowadays more and more paper money is printed with nothing to back it up other than the “good credit of the United States.”

When the Federal Reserve was created in 1913 by J.P. Morgan, John Rockefeller, and a few government employees and politicians that were in their pockets, it was created with the intent to expand the money supply (inflation) and bail out particular businesses and industries which Morgan and Rockefeller were conveniently invested in.  The Fed essentially became the new central bank and began to coerce banks into doing whatever it ordered.  It also began printing more and more money to pay for expensive and Unconstitutional government grants, loans, bailouts, and other programs.  It is because of the evils of the Fed that inflation is so high (prices are so high) and the dollar is almost worthless.  The gold standard has been abandoned and the Fed will continue to manipulate banks and financial institutions and kill our dollar.  The only way to reverse this is to reinstate the Gold Standard and abolish the Federal Reserve.

To sum up the above points I made: 1) Government interventions, including those in the form of tariffs, are very bad for business, workers, and the whole economy.  2)  The free market is about competition and consumer sovereignty.  Don’t necessarily buy American—buy what’s best.  3)  Bailouts are anti-capitalistic and the only way to stop this is to bring back the Gold Standard and end the fed.

The Contender

Finally, in your email to me you mentioned that in all your readings, you found no one with real solutions or sufficient character and a backbone.  I can honestly say to you that there is a hardworking group of people who are engaged in a grass roots effort to support an honest and hardworking man who is painfully aware not only of the REAL problems that are hurting the working class, but of real solutions to those problems.  This man of course is Ron Paul, who is an outspoken Austrian school economist who has been able to pinpoint problems and their remedies.  He is the only Republican contender who has tackled these issues, regardless of how unpopular the truth was, and remained unwavering in his position.  If you’ve heard of him but have found cause to distrust him, I beg you to reconsider and see what he has to say.

He has three very popular books out (among many others he’s written) which have changed the minds of many Americans.  There is The Revolution: A Manifesto, in which he outlines his political platform and uses the Constitution, American and world history, and the guidance of the Founding Fathers to back up his platform.  In the book End the Fed he makes the case and the plan for abolishing the Federal Reserve System and reviving the value of our hard-earned money.  In his latest book, Liberty Defined, he provides ideas for Constitutional solutions to various political, fiscal, and social ills that are plaguing our society.  I certainly hope my short explanation provided you with some meaningful answers, or at least provoked your thinking and ore beliefs.  I truly hope you also take into consideration the reading I recommended to you, which surely changed my thinking and strengthened my beliefs.  God be with you, my friend.

Both images use in this article are in the public domain and were obtained from Wikimedia Commons.

VIDEO: Ron Paul Unelectable?

Here is the audio version (set to video slide show) of Zach Foster’s article ‘Ron Paul Unelectable?‘  Enjoy, and send the video to your friends!

http://youtu.be/dehXErSiTmc

Note: Political Spectrum Publishing and the article author grant the Mises Institute unlimited noncommercial use to this video and its corresponding text article.

Ron Paul Unelectable?

By Zach Foster. This article originally appeared on The Political Spectrum blog on August 12, 2011.

In February, Fox News’ Bill O’Reilly was incredibly critical of Congressman Ron Paul’s ability to win the 2012 Presidential election.[1]  He mentioned briefly how Donald Trump was booed at the CPAC 2011 meeting by the crowd, as O’Reilly says, “because of Ron Paul.”  What O’Reilly failed to mention in that creatively worded statement is how the audience at CPAC was overwhelmingly favorable towards Ron Paul and highly disagreed with The Donald’s arrogant statement that Ron Paul cannot be elected.  Paul, after all, won the CPAC straw poll for the best possible Republican Presidential Candidate.  O’Reilly also compared Congressman Paul to a number of nearly nameless third party candidates who were unable to garnish massive support in the past, Ralph Nader being one of them.

 John Stossel, educated not only in the arena of politics but also in economics, spoke in favor of Congressman Paul.  The interesting thing about O’Reilly’s statements is that they seemed to flip-flop between undermining Congressman Paul’s ability to win and then calling upon him to run because he’s an interesting candidate and will be able to challenge the front runners, whom O’Reilly had already decided were Bachmann, Romney, and Perry.  What O’Reilly apparently didn’t seem to consider was the possibility that not only would Paul be able to challenge the O’Reilly-crowned “front runners” but also stump them while they merely pay lip service to the Constitution and actually present himself to the American people as a better candidate.

 O’Reilly’s main problem with Ron Paul is that he’s “too radical” and “isolationist.”  He seems to be unaware that Paul’s foreign policy is based on the Constitution and the guidance of the Founding Fathers.  If a foreign policy based on the Constitution and the guidance of the national founders is considered to be too radical for America, then America has obviously lost her way and needs to turn around and retrace her steps.

 In his 2008 book The Revolution, Congressman Paul quotes several early statesmen at length, including George Washington, Thomas Jefferson, and Henry Clay who were overwhelmingly in favor of avoiding foreign entanglements, to defend his Constitutional foreign policy.  He even quotes at length the non-interventionist platform that George W. Bush ran on and was elected on in 2000 and eventually betrayed.

 This idea was popular when George W. Bush ran on it, but eleven years later it’s all of a sudden too radical.  Ron Paul is not a radical for seeking a policy of noninterventionism.  He says:

 “I myself have never been an isolationist.  I favor the very opposite of isolation: diplomacy, free trade, and freedom of travel.  The real isolationists are those who impose sanctions and embargoes on countries and peoples across the globe because they disagree with the internal and foreign policies of their leaders.  The real isolationists are those who choose to use force overseas to promote democracy, rather than seeking change through diplomacy, engagement, and by setting a positive example.  The real isolationists are those who isolate their country in the court of world opinion by pursuing needless belligerence and war that have nothing to do with legitimate national security concerns.”[2]

 O’Reilly was even willing to make a bet against Stossel, the stakes being $1,000 for wounded warriors, that Congressman Paul won’t win a single primary election in 2012.  Many anti-Paul Republicans today, as in February, love to [falsely] cite Paul’s alleged un-electability.  When they do so, they ignore the fact that he is the leading candidate.  While on Monday a USA Today Gallup Poll showed Ron Paul in third place, a telephone survey of Iowa’s likely caucus participants revealed:

 “Overall, just 28% of potential Iowa Caucus participants are absolutely certain of how they will vote, while the rest could change their mind. Among those who are certain of their vote, Ron Paul is on top at 27%.”[3]

 The article on Info Wars making the above quotation also stated that “With this kind of showing, Ron Paul’s candidacy can no longer be accurately characterized as a long shot.”

 Following yesterday’s (August 11) debate in Iowa, Congressman Paul overwhelmingly won the Iowa Online Straw Poll, claiming 44% of the overall vote and leaving the other seven candidates to divide the remaining 56%.  The distant second in that poll was Herman Cain with 16%.[4]

 Even Fox News, many of whose anchors have been falsely and dishonestly proclaiming Romney as the frontrunner, admits that Ron Paul won the debate, receiving over 20,000 of the total 36,000 votes (Gingrich came in second place with 5,000~).[5]  Another Fox News online poll, at the time of this writing, confirmed Paul as the winner with over 14,000 of 37,000 total votes, raking in 38% of the total vote.[6]

 MSNBC’s online poll, riddled with user comments bashing the Republican Party, showed Ron Paul leading with nearly 11,000 (36%) of the total 29,500 votes.  The category with the second most votes (23%) was “no clear winner.”[7]  The Red Dog Report showed Ron Paul pulling in 78% of total votes, with Gingrich at a distant second with 7%.[8]  In the last Republican debate in June, Ron Paul won all three Fox News online polls as well as CNN’s poll (83%).[9]

 Clearly Ron Paul is not such a radical after all if he is receiving such massive support from both within and without the Republican Party.  As much as O’Reilly may lack faith in him, Congressman Ron Paul is not unelectable.  He is clearly the people’s choice for the most qualified candidate to run against President Obama in 2012, and he will do so on a platform whose solid foundation is the Constitution, and his guiding lights will be his faith in God and the written guidance of the Founding Fathers and great statesmen throughout the ages.

 


[1] http://www.youtube.com/watch?v=lmFjEA4vj9M

[2] The Revolution, chapter 2, pp. 10-11

[3] http://www.infowars.com/top-tier-ron-paul-polls-3rd-in-iowa-and-nationally/

[4] http://www.kcautv.com/story/15255706/ron-paul-wins-online-straw-poll

[5] http://www.topix.com/issue/fox/gop-debate-aug11

[6] http://www.foxnews.com/opinion/2011/08/11/who-won-gop-debate/

[7] http://politics.newsvine.com/_news/2011/08/11/7350500-who-do-you-think-won-the-gop-presidential-candidates-debate

[8] http://reddogreport.com/2011/08/who-won-the-iowa-republican-debate/

[9] http://runronpaul.com/polls/post-debate-polls-vote-for-ron-paul/

Ron Paul image courtesy of Wikimedia Commons.