monetary inflation and social decline

i've been thinking recently about the more subtle roles the state plays in the decline of society. one of these is the effect of monetary inflation on the time preference of market participants at the consumer level and how it manifests in a culture.

monetary inflation refers to the increase in the supply of currency. all things being equal, the inevitable result of an increase in the currency supply is a rise in prices, called "price inflation". price inflation is what most people envision when they hear of inflation in the general sense, though the technical, economic definition of "inflation" is a rise in the supply of currency.

time preference is the economic concept referring to the present values of present and future goods. in simpler terms, it is the extent to which individuals value consumption now at the expense of consumption later as opposed to consumption later at the expense of consumption now. those with higher time preference favor consumption now rather than later, placing a higher value on present goods than on future goods. the opposite is true of those with a lower time preference, preferring to save now in order to consume later.

in a society where the currency is constantly inflated and, consequently, prices continue to rise as the value of the currency decreases, the incentives for saving are decreased. the incentive to move out of holding currency is great considering that there is a negative return. conversely, the incentive to spend money (consume) now is increased as prices rise and are anticipated to continue rising. at the level where market participants have stored wealth, such a scenario creates asset bubbles, as wealth seeks a higher yield in investments that may not be sustainable under current market conditions. at the level where stored wealth is more shallow, where most of society resides, consumerism becomes stronger as the incentive to save is diminished.

as this phenomenon prevails, individuals no longer have incentive to exercise the self control necessary to forgo present consumption in favor of consumption later. this lack of self control may manifest itself in a culture, decreasing industriousness and responsibility in favor of leisure and gratification. we may see this at various areas in an affected society, resulting in more single parent households as the discipline needed to keep families together is diminished as well as the discipline needed to start families from a solid foundation. broad capital investment also suffers as savings, from which capital expenditure is derived, are depleted through spending on non-productive items in the consumer sector. this lack of capital funding undermines the productivity and economic progression of societies. these factors ultimately result in the decline of a civilization in varying degrees.

in reality, such phenomena result from inflation brought about by central banks in a nearly constant fashion as governments continually seek to transfer wealth from society to the politically connected. this suits the purpose of government as such wealth transfer is poorly understood by its victims (a likely outcome of state education) and also results, as described above, in a populace without the will, knowledge or incentive to resist such wealth transfer.

government isn't what it is by chance and is the most brilliant and successful of all criminal enterprises. it is responsible, in many ways, for the decline of civilizations, the above simply one of those. a consequence of the artificial increasing of time preference in a general population may be poisonous for the future of said society in the aftermath of inevitable governmental collapse, by leaving in its wake a helpless and childlike populace that is vulnerable to the rise of a similar state eager to poach the remains of wealth.

is this one of the reasons that states are able to persist despite their inherent instability, parasitic and self-destructive natures? they create for themselves the society that they desire, thereby ensuring, like a virus, their own perpetuation, changing the behavior of the host to suit the needs of the disease.

martin luther king jr. - hero?

today is the federal holiday designated to honor the dr. reverend martin luther king jr., a man widely recognized as the premier leader of the civil rights movement of the 1950s and 60s. his efforts did a great deal to bring about the passing of the civil rights act of 1964.

king is regarded as a hero among the majority of mainstream americans for his courageous campaign against racial discrimination in the united states and his outspoken opposition to u.s. involvement in the vietnam war. while i share his opposition to racism and war, and admire his dedication and courage in his pursuits, i wish to dispel the myth of his heroism and expose his ideas as morally corrupt and the product of logic stemming from false premises.

what should stand out first to the casual observer is that king is "honored" with a federal holiday. anything or anyone with its own federal holiday should at once be considered suspect. criminal organizations like the u.s. federal government don't honor anything that doesn't empower them against the unfortunate society burdened by their existence. king's role in bringing about the civil rights act of 1964 is considered by most as his greatest accomplishment, it was, in fact, a great setback to freedom in the u.s., empowering the government against private individuals and compromising the rights of property owners.

while king's crusade against racial discrimination was, in my opinion,a noble one, the fact is that people have the right to discriminate against anyone they want at any time and for any reason. while most of us despise such discrimination, we do not have the right to impose our beliefs onto others through force, which is what the civil rights act of 1964 does. the act contains provision for the outlawing of discrimination in virtually all private matters in title 2 and title 7. this use of force in private matters is likely to have hindered race relations by creating a social "grudge" between races not open to such integration at the time that has persisted even until today.

king advocated the forced redistribution of wealth by government to "disadvantaged americans" to compensate for historical wrongs. while it is undeniable that actions of the past have been a setback to certain groups in the u.s., advocating the redistribution of wealth in the present to right such setbacks is morally wrong. though i ardently advocate restitution of victims by aggressors against their person or property, it is a logical non sequitur to force such restitution to those not directly harmed by such attacks by those who didn't perpetrate the aggression. forcing americans to compensate the descendants of transgressions is just such an example. as illustrated above, discrimination in itself is the right of the individual and does not constitute such a transgression. slave-holding, on the other hand, does. all slave holders should be forced to compensate all slaves, since they aggressed against the person and property of such people. the lack of such justice, while in itself a tragedy, does not justify forcing the descendants of slave holders, who never held slaves, to compensate the descendants of slaves, who were never slaves.

king also advocated a move toward "democratic socialism" citing that "something is wrong with capitalism", probably stemming from a common misunderstanding of the difference between capitalism and corporatism and a lack of understanding of the role of profit in the functioning of markets in society. such ideas are based on the idea that some people (those calling themselves "government") have the right to redistribute the property of others. if that's so, what gives those people the right to the property of others? wasn't king's agenda rights equality?

probably the brightest spot in king's legacy was his opposition to the vietnam war. even here, though, one can see king's cognitive dissonance. king said, "(the u.s. government is) the greatest purveyor of violence in the world today", and who could deny that that statement is just as true today as it was then. the problem starts with king's recognition that the u.s. government is violent, but he doesn't seem to understand that foreign peoples are not the only recipients of such violence. king's own actions brought about violence against the person and property of u.s. citizens at home by stopping them, through force or the threat of force, from exercising their right to discriminate. he also seems oblivious to the fact that democratic socialism requires violence to force wealth away from some in order to give to others. while i admire king's stance against war, he was confused on the issue of violence and what, exactly, constitutes violence - namely, the use of force against individuals and their property.

for all of his virtues; courage, persistence and dedication, king's actions, all-in-all, were a stepping stone for government's increased power to crush individual rights in america and further impede upon freedom. his ideas evolved from a mixture of people from the heroic, such as ghandi, tolstoy, thoreau and Jesus Christ, to the evil, such as lincoln and marx. without a firm ethical principle, king's legacy is a mixture of good and evil, tainted by the fact that his federal recognition stems not from virtue or ideal, but government empowerment.

logic - it's not that difficult.

i get subscribed, somehow, to all kinds of email lists (i even get automated calls from congressional reps- how the hell did they get my number?). a couple of them have been these independent news sources, like "truthout" or "reader supported news".

well, rsn sent out its daily email with the usual links to news and opinion stories on it. one, "The Other Plot to Wreck America", claimed that "Americans must be told the full story of how Wall Street gamed and inflated the housing bubble, made out like bandits, and then left millions of households in ruin." as might be expected, the author was going to tell us, as if the story was a mystery to begin with. look at the article yourself. no mention of the role of the federal reserve. not one! and this is the "full story"? sorry, guy, but you left out a small part - a small, 90% part.

why bother with all the complex "analysis"? why not make it easier and more fun by chalking this stuff up to some ancient fairy plot, or a mysterious unicorn/leprechaun curse? if you're going to promote b.s., at least make it interesting. what i really want to know is why promote it at all? is it because you get paid by interested parties? is because you want to make a name for yourself by ingratiating yourself to the power elite? do you want to be thought of as a smart guy by those even more ignorant than you? heck, maybe you just like writing, for writing's sake, but don't care enough about the subject matter to do any research.

here's some advice, frank rich. any conclusion following logically from a false premise will be false. so, when you get ready to write, check your premise, then you won't look like a fool to those of us who are knowledgeable. of course, with public education having the unavoidable effect that it does, we may be such a small percentage that it doesn't matter. get rid of that idea that the state can ever be the solution to any problem, then you can be taken seriously by serious people.

if rsn wants me to donate to their organization, they're going to have to give me something i can't get somewhere - no, make that anywhere else. because i can get claptrap anywhere. if i want some doofus telling me a story based on false premises, advocating absurd solutions to the problem, i'll consult the mainstream media for free, thanks.

i know it's an opinion piece, but does rsn consider everything fit to print? i never asked to be subscribed to rsn's listserve, but, to be honest, i don't mind giving something a try. i have to actively avoid the crap from the mainstream media, but when i have to avoid the same crap in my inbox? sorry rsn, but "unsubscribe".

take your crap and pedal it to morons.

the state: spinning straw from gold

the people's republic of california has decided to ban large screen televisions in an attempt to free up power for household use. because we're so used to the inefficiency of government controlled resources and because most people have a glaring lack of understanding of such things, it seems a little shocking, but otherwise passe.

slightly underneath the surface is the great example of how government turns assets into liabilities. in a market, where assets (such as power grids and power generation) are used to generate profits and are subject to competition, there is every incentive to respond to an increase in demand with an increase in production. more basically, assets under private control must be maintained in a manner conducive to production.

governments, on the other hand, have no such incentive. governments derive their funding through violence. they force consumers to pay for their "services" after eliminating any competition by threat. they don't need the assets under their control to generate revenue. in this situation, these assets become liabilities that must be maintained at the expense of revenue with no added benefit. in other words, because assets are not needed to generate revenue, the cost of their maintenance makes them liabilities. therefore, the incentive is not to maintain them. this is readily seen in roads, sewers, power grids, etc, where maintenance is always poor and the services are highly unresponsive to demand.

the fact that california is banning certain televisions in order to reduce demand for power should come as no surprise. the state has no incentive to increase production and has the means to use force to curb power consumption. by enacting these laws, they will not have to take the necessary steps upgrade power generation assets which does nothing but drag on the revenue of the government. this is why california experienced the blackouts of a few years ago and why they will continue to have power generations problems for the foreseeable future.

the solution? simple. get such assets out of the hands of government and into the hands of private companies in an unregulated power market.

the police market

last year, wrote a couple of entries about the market alternatives to state-monopolized justice and regional defense. i sort of passed off the police issue because the ideas were so similar to those above and i just didn't feel like spending the time to do it. well, there is widespread confusion about the idea of "final arbiters", or those who would be final deciders of disputes.

i realized that without a discussion of police/dispute resolution, the final arbiter post would be difficult to understand for those who had never heard of such an issue. so, i'll briefly explain the market's vastly superior alternative to state-monopolized (socialist/corporatist) police.

in the current system, the government controls the services of police, or those agents legally authorized to use force against others. if you are naive enough, the supposed reason for state police is to secure the person or property of others. of course, as with any coercive monopolist, state police do anything but this. since they lack any competition and are able to force their "customers (victims?)" to pay for their "services", they need not conform to the desires of the market - after all, who are they going to lose customers to? consequently, law enforcement becomes arbitrary and self-serving, with police routinely violating the person and property of others through the enforcement of drug laws, property maintenance regulations, victimless traffic violation enforcement, licensing schemes, warrant enforcement for victimless crimes, asset forfeiture schemes, etc. not only is this not what the market would demand (would you pay for this if you didn't have to?), but it is the very thing that it is supposedly founded to prevent, i.e. a criminal organization.

left to the market, this type of organization could not exist. there is plenty of demand for the security of person and property and security entrepreneurs recognize this. but because this demand is universal, no agency would be able to maintain a presence in the market that is based on the violation of such security with all other security firms specifically designed to prevent this. in a market, firms have limited resources and must rely on their ability to provide consumers with goods and services that best suit their needs at the best possible price, lest they be overrun by competitors.

unlike government, there are true checks on the power of such firms. one cannot decide to go after the property of its own customers, or the customer will simply refuse to continue to pay for the services of said company and enlist the help of another. it can't go after the property of non-customers, or it risks being targeted by the firms employed by those individuals. in the market environment, reputation is everything and a company that uses its firepower to go after the property of others will quickly find that,not only will it lose the customers directly affected, but others will see the corruption and flee to the greener pastures of other providers.

but what stops a very successful company from amassing the force necessary to simply establish a government? first, isn't it ironic that the scary thing about this is the establishment of government? most who would ask this question are supporters of government in one way or another, which makes the question kind of funny. i'm theorizing here, so it's impossible to say exactly what will or won't happen under such conditions. that said, it would be very difficult for any company, even one that had managed to establish a monopoly in a certain area (which has never been done in any market sector). in order to do this, one would have to amass the resources in soldiers, firepower, infrastructure, etc. this would require massive funding and would be very difficult, if not impossible to hide. on its own, this would be a great disincentive to such an endeavor. obviously, such a company would already be doing very well in its business, so the incentive to do something like this would have to be very high, since the consequences of failure would be enormous.

so, the market is much safer and more effective at providing security to those who demand it than is the government (surprise!) and has many more real safeguards to the abuse of power.

the justice and security markets go hand-in-hand. if a police agency catches a criminal, how will they prosecute them? the justice post linked to above should answer that question, but the question remains for those who have legitimate disputes over property or the violation of it. how does one get people to agree to go to court? couldn't they just refuse to go and never have to answer for their crimes? this is where the question of the final arbiter comes in. who will, ultimately, decide right and wrong, if someone refuses to cooperate with decisions rendered by voluntary dispute resolution firms? i'll address that in the next post.

the final arbiter

before reading this post it would be instructive to read these first: "the state and the justice market", "the state and national defense" and "the police market".

a common question in theorizing the stateless, or anarchist, society is that of the "final arbiter". the question revolves around the scenario of a dispute that arises between two parties. one claims that the other has violated his property. nothing has been proven, so no force may be used. the plaintiff's dispute resolution company calls the defendant's company, but the defendant refuses to go to arbitration for the charges. he has not been proven to be responsible for the violation of anything.

what to do?

first, let's find out what the incentives are. if the companies involved are unable to cooperate, then what good are they? if your cell phone company can't connect you to your contacts on other carriers, what good is a cell phone? the incentives are for the various companies to cooperate with each other. in agreeing to provide service to people, they must draw up the conditions for such service and have the customer agree to abide by the contract. in such contracts will be stipulations concerning which arbitrators will be used, how many appeals may be made for a given decision, etc.

the defendant, by refusing to honor the arrangements of his provider, runs an almost certain risk of being dropped by that provider, leaving him without protection. if he is able to get coverage with another provider, his costs will be much higher. for in the anarchist society, reputation is everything. once he is identified as a high risk, everything becomes more difficult. by complying with the arrangements made by his company (which would almost assuredly include compensation for his time by the plaintiff if found innocent), he may, if found guilty, pay for the damage done and be on his way with the minimum amount of damage done to his reputation.

this is instructive, but none of it answers the question of the who the final arbiter is. as mentioned above, reputation in the anarchist society is everything. it must be known in order to secure protection, so that agencies will know who is a risk and who isn't, by banks for the same reason, by employers, by insurance companies or even by those simply wishing to do business with the best customers. in the anarchist society, the reputation business is big.

needless to say, those who monitor reputation will know who is refusing to comply when charges are brought against him. every time such infractions are made, it makes life more difficult. the more serious the charges that are not answered to, the more one's reputation is hurt. a person with a bad reputation is squeezed to the margins of society and is less and less able to afford his own protection - leaving him open to attack by his unsatisfied accusers.

there need not be an authority with the power to force people to answer for crimes. such things can be handled in a much more effective and civilized manner by voluntary means. it is in everyone's interest, individually, to participate.

who is the final arbiter? society itself.

veteran's day is nothing to celebrate

here's another emotionally charged topic on an emotionally charged day. maybe not the best time to bring it up, but i'll try to be polite and not as aggressive as i've been in the past. it's an important idea and people need to give it a fair shake.

when it comes to the military, many of us have relatives and friends who are or have been involved in it. for me, my grandfather was a POW in WW2, my dad was a reservist and so was i, so i have the same kind of exposure to the military (maybe more) as many others. of course, because we are all taught to love and respect military service and the soldiers who are involved, the subject has a much more emotional rather than logical overtone. people will yell and scream if any resistance to the idea of military worship is questioned, regardless of the fact that the argument (if you can call such things "arguments") has little logical merit, but instead usually consists of cliches and platitudes with little supporting reasoning.

first, the military is supported by various means, the main ones being taxation and inflation. inflation is an increase in the money supply. this supply is controlled by the federal reserve and is politically manipulated. when money is created to pay for military adventures (it's done because people don't understand it, like they do taxation, and its effects are more subtle than direct taxation) like the iraq war and the afgan war, the supply of money increases and the value of currently held dollars is reduced. so, the value of the money you hold is taken, without your consent. this is theft in the same way that counterfeiting is theft. taxation, on the other hand is more obvious. the government forces you to pay through the threat of force without your consent. this is, more obviously, outright theft.

secondly, it is questionable as to whether the military actually defends the country at all. the united states has not been invaded in nearly 200 years. since then, it has been involved in many foreign conflicts, most, if not all have been unnecessary for the security of the united states. in world wars 1 and 2, vietnam, iraq 1 and 2, afganistan, grenada, korea, etc., there was no direct threat to the united states. during the pearl harbor, uss cole, and khobar towers incidents, the military was unable to protect itself, much less the u.s. mainland. during the terrorist attacks of 2001, the military was unable to protect americans at home.

considering the massive and forced funding of the military, it has a less than stellar record of effectiveness, which is to be expected of a purely socialist enterprise.

the cliches would have you believe that the military is necessary for the maintaining the freedom of americans. this blog is based on the idea that americans are not free at all. virtually all of the posts here will reflect that issue. considering that the military is funded by force might lead one to believe that the military is, in fact, a detriment to freedom rather than a support. this doesn't include the impact of military actions abroad, on civilian populations. because of the wide and indiscriminate nature of warfare, the populations directly affected by military operations are much less free.

hang with me here. it gets worse, but then it gets better.

concerning the indiscriminate nature of war: any action that knowingly results in the death of innocent people is murder. therefore, war involves massive amounts of murder. the military is funded by theft in order to finance murder. yeah, i know that's pretty rough, but it's true.

but veteran's day is not so much about military adventurism, but about the people who participated in it. these aren't bad people. in fact, many of them are probably some of the best people society has to offer. unfortunately, sadly, these people were duped by the propaganda that their participation in the military is the highest nobility achievable. what's sad is that they give so much to a cause that they are led to believe is great and noble, but is, in fact, evil. my grandfather spent 9 months in a german prison camp after his a-10 was shot down over germany in WW2. he went into the camp weighing 160 lbs and escaped weighing 95 lbs. not to mention the millions of americans who were killed in the united states' unnecessary involvement in this war - what a terrible price to pay.

veteran's day should be a time of mourning for all of those killed or injured in the myriad military adventures of the u.s. government. it should be a day to reflect on the evils of the state and those whose lives were ended or negatively altered by the tragedy of war.

don't celebrate veteran's day. instead, think of the evil of government and the sad reality of the great people who have been lost in something as useless and wrong as the military - especially when they could have lived up to their potential in the productive and peaceful sector. encourage current members not to reenlist and discourage others from enlisting. save your friends, family and even strangers from the evils of military participation.