Henry Hazlitt and I on the Auto Bailout

Hazlitt

“Dying industries absorb labor and capital that should be released for the growing industries.  It is only the much vilified price system that solves the enormously complicated problem of deciding precisely how much of tens of thousands of different commodities and services should be produced in relation to each other.  These otherwise bewildering equations are solved quasi-automatically by the system of prices, profits and costs.  They are solved by this system incomparably better than any group of bureaucrats could solve them.  For they are solved by a system under which each consumer makes his own demand and casts a fresh vote, or a dozen fresh votes, every day; whereas bureaucrats would try to solve it by having made for the consumers not what the consumers themselves wanted, but what the bureaucrats decided was good for them.  Yet, though the bureaucrats do not understand the quasi-automatic system of the market, they are always disturbed by it.  They are always trying to improve it or correct it, usually in the interests of some wailing pressure group.” – Henry Hazlitt, Economics in One Lesson, 1946

My beefs with the bailout:

  • It rewards failure (through “loans”) at the expense of success (through taxes).
  • The excuses are lame.  A few loosely-quoted examples:  “People won’t buy our cars because they think we might go bankrupt.”  More likely: they won’t pay for your inferior product.  People know that bankruptcy does not equal death, as I am sure all of your sales associates have told their customers.  Lame.  “Foreign companies are receiving good incentives to open new factories, but we have to use our old ones.”  More likely: the unions have you by the balls.  Lame.  “Foreign companies are getting assistance from their governments, which is why we need assistance from ours.”  Not sure if either of the claims made in this excuse are true, but lame nonetheless.  If other governments want to misplace investments, that’s their business.  Their economies will become weaker for it, and our overall economy will be relatively more productive than theirs, regardless of what happens to the automakers.
  • I live in Tennessee.  The auto industry in Tennessee is doing relatively well.  Why should Tennessee be punished for Michigan’s business failures?  For the taxpaying laborer at a Tennessee factory, there can be no sufficient reason.  It is stealing from the Tennessean.  It is immoral.
  • It is unconstitutional (see part 2 of Jefferson’s argument and replace “bank” with “auto loan,” then become disgusted by the monstrous parasite that is your federal government).
  • It will not save the automakers.  The beggars will be back to Congress, palms upturned, and because the government will have already invested in their success, it will be much more difficult to turn them away.
  • The government cannot “save” one industry without adversely affecting another, or–what is more likely the case–many others, through opportunity costs and/or taxation.
  • I prefer Honda, Toyota, and Nissan to GM, Ford, and Chrysler, mainly because, when the Japanese automakers take my money, they give me a car for it–not a promise to try to pay it back A.S.A.P.
  • The United States government is in a fiscal abyss, and one unfortunate generation will eventually have to fit the bill.  This is what I call generational slavery, because one or more generations has decided, rather than extinguishing its own debts, to pass them on to posterity, guaranteeing “confiscatory” income taxation (as if there were any other kind) in the future, and thus robbing future generations of their own labor.
  • As poorly as the executives at GM, Ford, and Chrysler have managed their businesses, the federal government (or “car czar”) would do the job even worse–much worse, I believe.

If this bailout passes, the Lions will go 0-16 this season.  Sorry Detroit, karma’s a bitch, but I’m sure one more quarter of Ford’s failing operations is preferable to one win at Ford Field.  Go Colts!

Red Light Cameras = Proof Evil Exists

Hey Dubya, here's your proof that evil exists.

“All agree that the legislature cannot bargain away the police power of a State. ‘Irrevocable grants of property and franchises may be made if they do not impair the supreme authority to make laws for the right government of the State; but [101 U.S. 814, 818] no legislature can curtail the power of its successors to make such laws as they may deem proper in matters of police.’ Metropolitan Board of Excise v. Barrie, 34 N. Y. 657; Boyd v. Alabama, 94 U.S. 645 . Many attempts have been made in this court and elsewhere to define the police power, but never with entire success. It is always easier to determine whether a particular case comes within the general scope of the power, than to give an abstract definition of the power itself which will be in all respects accurate. No one denies, however, that it extends to all matters affecting the public health or the public morals. Beer Company v. Massachusetts, 97 id. 25; Patterson v. Kentucky, id. 501. Neither can it be denied that lotteries are proper subjects for the exercise of this power.” – Chief Justice Waite

Despite the good intentions of public officials, in its “Request for Proposals for Automated Red Light Enforcement System,” the City of Knoxville’s legislature affects to “bargain away the police power,” which is forbidden by the United States Supreme Court in the decision above (Stone vs. Mississippi, 1879). The restriction invoked hinges on the debatable definition of “police power,” which is generally accepted as “the capacity of a government to regulate behavior and enforce order within its territory.”

Beyond the obvious illegality of camera systems, there are other noteworthy aspects of original intent that pertain to automated enforcement systems like the red light cameras in Knoxville. When we consider the constitutional framework of our government, the implementation of automated enforcement is offensive to the liberty intended. In opposition the Fourth Amendment of the U.S. Constitution, it assumes, searches for, and punishes the trivial moral shortcomings of free and good people-without probable cause.

The aforementioned “Request for Proposals” leaves the responsibility of policing public intersections to a private entity. This private entity is not a local company, and moreover has no responsibility to the electorate.  If the citizens do not like the way the firm operates, they cannot elect a new firm; it remains unfettered by political dissent.  Whereas the public police force has a primary objective of protecting and serving the people, the private firm’s primary objective is to earn a profit, even if at a cost to the rights, safety and happiness of citizens (as has been proven in Chattanooga’s case, among others).  With the “Request for Proposals”, the enforcement of a traffic signal is no longer for the benefit of the public, but for the benefit of a private firm.

There is a psychological change that takes place in drivers as a result of traffic light enforcement, which existed before automated camera systems, but is exacerbated by their introduction. When the rules of the road originated, it was not necessary to enforce their use. With rare and extremely unusual exception, people followed the signals out of an interest in their own safety. It is now unusual for drivers to follow signals for this reason; the reason now is to follow a law, without regard to safety. While people know the signals are there to keep them safe, they do not follow them for their personal safety. Because of traffic law enforcement, the objective of an automobile’s operator has been fundamentally altered. The driver’s original purpose, “to arrive at a destination as quickly as is safely possible,” has been replaced by a new one, “to arrive at a destination as quickly as is legally possible.” This psychological change, which can only be attributed to unnecessary and costly enforcement, has made American roads much less safe, because individuals are more apt to act for their own benefit than for the pleasure of authority.

It is unfortunate for lazy enterprises that good government practices rarely grant profitable contracts, and it is the policy of bad governments, as well as bad businesses, to reward mere association and sloth. Proper engineering and timing of signals will do much more for reducing accidents than any enforcement firms ever could, but these will require natural law and common sense to be used in place of coercion and lucrative contracts, an occasion rarely seen in our time. 

Automated enforcement contracts are a dangerous sign that we are but a step from the sort of fascism Mussolini called “corporatism,” and defined as “a merger of state and corporate power.”

Request for Proposals for Red Light Automated Enforcement:
http://www.cityofknoxville.org/purchasing/bids/0513_redlight.pdf

Stone vs. Mississippi (1879):
http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=101&invol=814

Fourth Amendment text:
“The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

Letter response from Senator Bob Corker, (R), TN

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Senator Corker responds to my letter about FISA Amendments

Dear Mr. _______,

Thank you for taking the time to contact my office regarding S. 2248, the FISA Amendments Act of 2007. Your input is important to me, and I appreciate the time you took to share your thoughts.

Like you, I believe that protecting our civil liberties is a fundamental responsibility of the federal government. However, I believe that we must strike a balance between preserving civil liberties and having the resources necessary to protect our country.

On February 12, 2008 I voted to pass S. 2248 as approved by the Senate Intelligence committee. In this particular case, because the federal government asked the telecom companies to comply with allowing surveillance, it does seem reasonable that the federal government should provide them protection from lawsuits stemming from compliance. Furthermore, I strongly believe that Americans can be assured that their constitutional rights will be protected while our government retains the tools necessary to track terrorists throughout the world.

Thank you again for your letter. I hope you will continue to share your thoughts with me.

Sincerely,

Bob Corker
United States Senator

This response is much appreciated, but also concerning.  I hope that the Senator will take time to talk with Representative John Duncan, Jr. about the importance of defending the Constitution.

Letter to Representative John Duncan, Jr., (R), TN

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Congressman Duncan,

I think you are acquainted with my parents, _______ and _____ _______.  I am in college, and I have become very interested in history, economics, and government. 

I had heard your name numerous times growing up in Knoxville, but I never took the time to research your politics.  Now that I have done that, I can tell you that I am impressed.  You are a statesman in the truest sense, and you stand for those Americans who have voiced no interest in your existence, except through merely living.

Thank you for taking a stand for fiscal responsibility and non-intervention, in the interest of the people, and in opposition to a self-interested, powerful minority.

My generation is one that grew up with many of its needs met, and many innovative extravagances available.  We have had cell phones in our school years.  We have had the Internet, allowing us to experiment with our identities and networks at an early age.  We have been coddled and rarely restricted in our behaviors.  We are going to college in droves, and many of us are going free of expense.  A superficial light on the circumstances of my generation will bring some glaring negatives into view; but there is a net positive that I know you will appreciate, and that is individuality, and an insatiable thirst for individual freedoms.

I have a message I would like you to send along to your BIG spending friends in Congress.

Our generation will not be treated like imbeciles, which appears to be the intent of many of your colleagues, who ignore deficits, (former) GAO head David Walker, foreign policy failures, reality, or anything that does not carry an oversized checkbook or promise media exposure.  We know about the fiscal gap, what it means for us, and we know failure when we see it.  We know too much, and we have seen too much, and we communicate independently online too regularly, for their scheme against us to succeed.  The expense of all the government’s irrational exuberance is ours, even though we had no representation in it.  How American is that?  Thomas Paine is turning in his grave.

Washington’s elect have a MORAL obligation of divine origin, to minimize the expenses of, the international hatred toward, and limits of freedom on our generation.

If the current assembly will not act on our behalf, we will suffer tremendously, and you know that.  But we will fix your errors ourselves, eventually.  We do not notice old media (television, print, radio, etc.), and we communicate directly with the source (Iraqis, Israelis, Egyptians, Jordanians, Africans, etc.) on the Internet.  The activists, thinkers, and educated members of our generation have flocked to the Ron Paul Revolution.  The heart of political activism is changing–pumping backward (or more appropriately, forward again), all the way to the eighteenth century, and our faith is in individuals–not government or corporation.  With a free Internet, we currently have all the necessary facilities at our disposal to put America back on its proper path, regardless of the interests of the power elite.  We have it in our power to begin the world over again.  In my limited position, I do all that I can, and I hope you do the same in these trying times.

Please help us while you can.  Stave off attempts to indebt us further and deny us liberties.  Do so with all of your might and creative power, because our interests are your interests, and I believe it is your God-given duty, as a member of humankind, to fight for what you know, in your heart and in your head, is right.  The fight for a free America is a fight for the good of humanity.

Sincerely,

Letter to Senator Bob Corker, (R), TN

Senator Corker,

I met you through my friend Brad Smith at a UT football game during your campaign. 

I agree completely with your stance on the stimulus package.  Thank you for standing up for citizens, and not supporting the bill that I see as a not-so-creative vote-buying scheme. 

I was disappointed to read that you voted for the FISA reforms.  Please consider the Fourth Amendment and its origins.  If we allow ourselves to give in to fear, the terrorists have won.  If we lose a million lives, but keep our commitment to freedom, American principles have still triumphed.

The principles of freedom, which made this country great, do not regard America as their home, or the Congress as their protector.  If we abandon them here, principles of freedom will have no home on this planet.  Our aim should be to protect freedoms everywhere.  That is the purpose of American government, right?  That is what made Reagan a hero, in my opinion.

I met a young Chinese student at UT a couple of weeks ago.  He said that foreigners hold all Americans accountable for the continued atrocities in the Middle East, because they have always learned that America is a government of the people, by the people, and for the people.

When you make a decision, please remember that you are representing all of us, and that the expense of war is always ours.  All Americans get the blame, even though 70% of us want out of Iraq.  All Americans get the blame, even though few of us condone torture or unwarranted wiretaps.  And, if retribution comes (and America is not unbreakable), remember that all of us will be blamed for the injustices perpretrated by a powerful minority, and all of us will suffer the economic and/or military consequences.

Like you, I am small in stature.  When we met, I joked that we saw eye to eye, and I believe we do in a lot of ways.  Please, do not be a small man in Congress.  View things as they are, without regard to person or place, and stand up for American principles of freedom always, no matter the cost.  Uphold the promise of your oath, stand up for freedom, and you will be more than a senator: you will be a statesman. Thanks for your representation.

Sincerely,