DecliNATIONblog

Yesterday I finished reading Tom Woods’ ever relevant and insightful new work, Nullification: How to Resist Tyranny in the 21st Century.  I found it to be spot on, precise, and persuasive.  Reading Dr. Woods comes very easy to me as I enjoy his style and prose.  He is gifted in his ability to revive and breath new life into what would normally be construed as mundane and archaic principles.

The premise of the book really comes down to a return to the state’s rights that the founding fathers of our nation and Constitution had in mind.  This is explicitly stated in the 10th Amendment of our Bill of Rights:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

Dr. Woods has done his homework and provided copious examples from both the past and present on how state’s rights do in fact work to provide a barrier from the overreaching tyranny of the federal government.  From the past we learn of the the Virginia and Kentucky Resolutions against the Alien and Sedition Acts signed into law by then President John Adams.  But even present day examples exist, my favorite being California’s stand against the federal government in regards to Medical Marijuana.

My guess is we are about to see the 10th Amendment  again in the near future.  Earlier this week as a matter of fact we read, “a Massachusetts judge struck down the Defense of Marriage Act, which defined marriage as solely between a man and woman, on Tenth Amendment grounds.”  This issue will certainly come up again as Obamacare becomes closer and closer to taking effect.

The Daily Caller has a nice write-up today in regards to the 10th Amendment and how it is playing out with various political groups.

Is this guy serious?

Paul Krugman is right in the fact that “we are now, I fear, in the early stages of a third depression”.  So I am not concerned with his conclusion as much as I am concerned with his solution.

Government needs to spend more money?

Government needs to get more involved in correcting this mess?

Deflation is of all things the thing to be feared most?

And they gave him a Noble prize for this nonsense.

The fact is there have been other economic depressions in our nations history, other than the 2 that Mr. Krugman brings up.  We actually had a depression in 1920-1921 albeit short-lived.  According to the Austrian School of Economic Thought, the depression was needed for market correction and therefore was a good thing in that it liquidated malinvestments left over from WWI.  What Keynsians like Krugman fail to recognize is that it is government intervention that in fact prolongs the depression i.e. FDR’s New Deal.

If you simply allow the free-market to correct itself as President Harding did in the 1920 depression, then the depression will end quickly and recovery will begin sooner.

I just don’t see Krugman, or Obama for that matter, getting the point and letting the free-market do what it needs to do.

I can assure you that Krugman’s “hair of the dog” spending treatment will only delay what the market needs to do and will in fact make it that much worse when the day of reckoning arrives.

Scary times.

Some 30 years ago, the economist Milton Friedman appeared on The Donahue Show with Phil Donahue.  The entire interview can be viewed on Youtube here (note: The interview is in 5 parts).

The following is a 2 minute transcription where Friedman takes Donahue to task for his government-interventionist ideas:

Donahue:  When you see around the globe, the maldistribution of wealth, the desperate plight of millions of people in underdeveloped countries, when you see so few “haves” and so many “have nots”, when you see the greed and the concentration of power; aren’t you ever…did you ever have a moment of doubt about capitalism?  And whether greed is a good idea to run on?

Friedman: Well first of all, tell me, is there some society you know that doesn’t run on greed? You think Russia doesn’t run on greed? You think China doesn’t run on greed? What is greed? Of course none of us are greedy, it’s only the other fellow whose greedy. The world runs on individuals pursuing their separate interests. The great achievements of civilization have not come from government bureaus. Einstein didn’t construct his theory under order from a…from a bureaucrat. Henry Ford didn’t revolutionize the automobile industry that way. In the only cases in which the masses have escaped from the kind grinding poverty you’re talking about, the only cases in recorded history; are where they have had capitalism and largely free-trade. If you want to know where the masses are worse off, worst off, it’s exactly in the kinds of societies that depart from that. So that the record of history is absolutely crystal clear: that there is no alternative way, so far discovered, of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.

Donahue: But it seems to reward, not virtue, as much as ability to manipulate the system.

Friedman: And what does reward virtue? You think the Communist Commissar rewards virtue? Do you think a Hitler rewards virtue? Do you think, excuse me, if you’ll pardon me, do you think American Presidents reward virtue? Do they choose their appointees on the bases of the virtue of the people appointed or on the bases of their political clout? Is it really true that political self-interest is nobler somehow than economic self-interest?

You know, I think you’re taking a lot of things for granted. Just tell me where in the world you find these angels, who are going to organize society for us.

Donahue: Well…

Friedman: I don’t even trust you to do that.

You just don’t find that kind of exchange on TV anymore.  It is so easy to sit back and pick on free-market capitalism, as is the zeitgeist, but truth be told it was not the free-market that put us in this position, but government intervention into the free-market.  A great expose testifying to this fact is Meltdown by Tom Woods.  I appreciate Milton Friedman’s contribution to academia and free-market capitalism and it is my guess that his keen insight is going to gain more and more fans as people begin to realize how accurate he was.