The Old-School Liberal

“Freedom granted only when it is known beforehand that its effects will be beneficial is not freedom” — Friedrich Hayek

Posts Tagged ‘Ron Paul’

On the Wall Street Bailout

Posted by dagnygalt on October 3, 2008

The recent legislation passed in efforts to ease the tight credit markets may in fact create legislation which makes it more difficult for the economy to revive and sustain growth. Analysts and voters should consider the role of the Federal Reserve in keeping interests rates artificially lower than the naturally market set rate in encouraging mal-investment and ultimately significantly contributing to the unwise investments made by banks and lenders. In addition, government policies benevolently aimed to increase home-ownership among low and moderate income groups likely provided extra incentives for banks and lenders to invest in areas they normally would not have considered.

Over the past year we’ve seen our financial markets uncomfortable sway until in recent months we’ve seen the stock market plunge downward. Mistakes have been made and most people in the United States, and likely even the world, will experience the consequences of these mistakes. When discussing possible causes of the financial crisis, National Public Radio, CNN, MSNBC, and many more have repeatedly discussed the role of deregulation and greed as a cause of the crisis. I pose a question to them: “Do you really think that there was a sudden increase in the amount of pervasive greed in Wall Street in the past decade?” It is extremely unlikely that human nature among a specific group of people could have systematically changed without cause. Deregulation could certainly be a cause; however, one convinced of this cause should take an objective step back and examine the evidence.

Research has shown that low interest rates stimulate investment. (1) This is likely the reason the Fed kept the rate low for so long. However, much research has shown that interest rates artificially kept low also tend to encourage mal-investment. Harvard’s Joint Center for Housing Studies also explained in The State of the Nation’s Housing 2008 (2)  report how the Fed’s low interest rates encouraged the housing market bubble, an expansion of risky loans in subprime mortgage market, and ultimately lead to a derivation of complicated and very risky mortgages repackaged and purchased by large banks. In addition, an prevalent ideology existed (and still exists) among policy makers and legislatures that homeownership creates wealth. Thus, they create policies which incentivized banks to lend to people who the bank might not normally lend to because of risk. For example, the Community Reinvestment Act of 1978 mandated that banks lend to families that in many cases couldn’t afford the loan payments. Thus, the combination of government policy making and encouragement of home ownership among those who could not afford homes and artificially low interest rates ultimately lead to the bad investments (3) which are highly contributing to the economic problem our country currently faces.

The bailout plan was indeed deliberated over, which is good. However, given the urgency and the emotional pressure put on government “to act” may indeed have prevented policy-makers from analyzing the true causes of the crisis. In addition, regulation enacted through the bailout passed this morning may in not at all decrease the likelihood of mal-investment and instead create new unforeseen problems that will prevent the economy from competing globally.

In conclusion, I hope voters will recognize that the economic problems we face today may in fact be a result of poor government policies. In addition, we should be not allow our fear and emotion detract from our ability to see evidence clearly. In efforts to “do something” we may in fact not be doing what is in our best interest in the long run.

BLUE: Real Yr/Yr GDP Growth
RED: Real Effective Fed Funds Rate

Source: Compiled by Robert P. Murphy, http://mises.org/story/2728

1 The New York Federal Reserve http://www.newyorkfed.org/education/level.html
2 Harvard’s  Joint Center for Housing Studies,  The State of the Nation’s Housing 2008, at http://www.jchs.harvard.edu/son/index.htm
3 Sechrest, LJ. 2006. “Explaining Malinvestment and Overinvestment,” Quarterly Journal of Austrian Economics 6, 4:27-38.

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Cato on the Gold Standard

Posted by Poorsummary on February 20, 2008


50267026.jpgLawrence H. White, Professor of Economic History at the University of Missouri-St. Louis debunks several myths about the gold standard and concludes the following:

“A gold standard does not guarantee perfect steadiness in the growth of the money supply, but historical comparison shows that it has provided more moderate and steadier money growth in practice than the present-day alternative, politically empowering a central banking committee to determine growth in the stock of fiat money. From the perspective of limiting money growth appropriately, the gold standard is far from a crazy idea.”

Read more about the seemingly antiquated monetary regime that our constitution prescribes and politicians ignore here.

Posted in 2008 Presidential Race, Constitution, Politics, Ron Paul | Tagged: , , , , | 2 Comments »

Why not ask the Iraqis?

Posted by Poorsummary on February 12, 2008

LennieWhile politicians debate about how many decades we should leave troops in Iraq, more evidence surfaces to indicate that the US is less like the penitent shopper who broke an item, and more like Lennie Small from Of Mice and Men who just can’t leave well enough alone:

THE US occupying army in Iraq (euphemistically called the Multi-National Force-Iraq) carries out extensive studies of popular attitudes. Its December 2007 report of a study of focus groups was uncharacteristically upbeat.

The report concluded that the survey “provides very strong evidence” to refute the common view that “national reconciliation is neither anticipated nor possible”. On the contrary, the survey found that a sense of “optimistic possibility permeated all focus groups … and far more commonalities than differences are found among these seemingly diverse groups of Iraqis.”

This discovery of “shared beliefs” among Iraqis throughout the country is “good news, according to a military analysis of the results”, Karen deYoung reports in The Washington Post.

The “shared beliefs” were identified in the report. To quote deYoung, “Iraqis of all sectarian and ethnic groups believe that the U.S. military invasion is the primary root of the violent differences among them, and see the departure of ‘occupying forces’ as the key to national reconciliation.”

So, according to Iraqis, there is hope of national reconciliation if the invaders, responsible for the internal violence, withdraw and leave Iraq to Iraqis.” (link)

The Iraq situation is a complicated one. Those who respect the constitution (though few they may be) say we had no right to go in, but there may be something to be said for fixing what we’ve broken. Perhaps the issue would be a bit clearer if we included the voice of the Iraqis in our decision making. After all, it’s their lives on the line.

Posted in Constitution, Government Gaffes, Politics | Tagged: , , , , , , , , | 3 Comments »

Would a Ron Paul Presidency Hurt Israel?

Posted by Poorsummary on January 16, 2008

Israel FlagSome have claimed that a Ron Paul presidency would be bad for Israel. Shimshon Weisman, an orthodox jew who lives in Israel, begs to differ (thanks to Lew Rockwell for the post):

There are a number of issues here. First, aid to Israel. It has been obvious for a long time that Israel does not need this aid. Israel’s GDP per capita is at European levels and rising. The aid itself is a form of corporate welfare in that it must be spent in America. It comes with many strings attached.“It allows the government to avoid sorely needed economic reforms.

“Along with the aid Israel receives, potential or actual enemies receive several times more. That aid doesn’t just allow the recipient nations to avoid reforms, it actually props them up and allows them to continue to maintain a bellicose stance against Israel (this certainly includes Egypt, with whom Israel has a peace treaty in place).

“When the entire world condemned Israel, including President Reagan on down in America, Dr. Paul supported Israel’s right to act in its own self-interest (and preemptively, I might add) in its bombing of the Osirak reactor in Iraq. He had absolutely nothing to gain by taking this position, and nothing to lose by following the herd in its condemnation of Israel.

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Posted in 2008 Presidential Race, Politics, Ron Paul | Tagged: , , , , , , | 4 Comments »

Ron Paul: The Most Electible Republican

Posted by Poorsummary on December 2, 2007

Ron Paul AdThe 2008 presidential election is rapidly approaching, and Republicans are going to have a difficult time holding onto the presidency after the Bush administration. Prediction markets like Intrade provide a fairly accurate assessment of the probability of each candidate winning the primary nomination, as well as the probability of each candidate becoming president. In determining which candidate to send to a general election, however, primary voters should choose the candidate most likely to win the general election, given that they receive the primary nomination.

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Non-Interventionism ≠ Isolationism

Posted by Poorsummary on December 2, 2007


Non-interventionism

Bruce Miller of The Blue Voice confuses non-interventionism with isolationism:

“Let me start this by saying as I’ve said in a number of posts before that most warnings about ‘isolationism’ are fake, straw-man arguments. At least outside of Ron Paul’s political corner, there are no actual isolationists in American politics…If you listen carefully to what Ron Paul and similar isolationist rightwingers are saying, their brand of nationalism is coming from a very similar place. They want to discard normal diplomacy, foreign aid, even the threat of economic and trade sanctions from the set of foreign policy tools available to the United States. They are not far from the neocons in that essential focus. As the Overstreets described the perspective 43 years ago, “What we might need to do abroad, in military terms, could be done by a well-placed bomb or a regiment of Marines.”

Bruce mischaracterizes Congressman Paul’s foreign policy. Paul does not advocate “pulling back out of the world” altogether, but merely eliminating US military intervention unrelated to our national security. Whenever he talks about the success we’ve had by leaving Vietnam, he also talks about the stability that has come from our actively trading with them:

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Will the GOP Reduce the Size of the Government?

Posted by Poorsummary on November 30, 2007


In the GOP Youtube debate, Emily Ekins asked a very straightforward question which begs for a simple answer: “What are the names of the top three federal programs you would reduce in size in order to decrease [spending]?” Here are the answers:

Fred Thompson seemed to be answering the question when he started talking vaguely about Medicare and Social Security reform, but he makes it clear that he is not providing a straightforward answer:

Cooper: So of the top three you would say Social Security?

Thompson: No. I didn’t say that. There is — the OMB has come out with a list of over 100 programs. I would take all 100 of them, the ones that are full of waste, fraud and duplication.

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Posted in 2008 Presidential Race, Current Events, Politics, Ron Paul | Tagged: , , , , , , , , , , , , | 1 Comment »

Ron Paul: the Centrist Republican

Posted by Poorsummary on November 14, 2007

Centrist

While the mainstream media has panned Ron Paul as a “fringe candidate,” it turns out he may be the most centrist of all the Republican candidates. Ask any democrat you know what the 2 most important issues are in this presidential election and you’re likely to hear “the environment,” and “the war.”

Since its hard to know exactly what a candidate will do based on what they say in debates (remember Bush’s “humble” foreign policy with no nation building?) it’s important to look at their actual previous behavior. For congressman and senators, this means their voting record.

The environmental advocacy group League of Conservation Voters publishes a National Environmental Scorecard for every Congress since 1970. According to their website, “The Scorecard represents the consensus of experts from more than 20 respected environmental and conservation organizations who selected the key votes on which Members of Congress should be graded.”

Suffice it to say the democrats lead the pack on the environment (bear in mind that the costs of such bills are not taken into consideration), but when it comes to the Republicans, something very interesting has occured. Ron Paul was the most environmentally friendly Republican presidential candidate rated. Here are the life-time scores (note that the other front-runners, Guliani and Romney, are omitted since they were not congressmen or senators): Read the rest of this entry »

Posted in 2008 Presidential Race, Current Events, Politics, Ron Paul | Tagged: , , , , | 2 Comments »

Romney working hard to put food on his family?

Posted by Poorsummary on October 22, 2007

Romney, from the latest Fox news debate:

All of us on the stage are Republican. But the question is, who will be able to build the house that Ronald Reagan built — who will be able to strengthen that house, because that’s the house that’s going to build the house that Clinton, Hillary, wants to build”

Huh? With uncharacteristic disheveled hair, Romney began tonight’s debate on the wrong foot with this particularly jumbled anthropomorphism of a residential dwelling. The Republican front-runners (with the notable exception of Ron Paul) have long followed suit with Bush on the Iraq war, but now Romney has gone one step further by mimicking Bush’s blundering public speaking skills.

In all fairness, letting one’s tongue get ahead of one’s brain is something every politician and public speaker deals with from time to time. What Romney, Guliani, and the rest of the neo-conservative bunch need to worry about is their disrespect for the constitution, the rule of law, the concept of truly limited government, and individual freedom. Unfortunately, principled, just, and economically sound leadership requires that we allow people to make decisions that are not always the best for them– the reason being that bureaucrats in Washington, if they make the decisions for us, are going to get it much more wrong much more often. To quote Jacob Hornberger, “If you are not free to choose wrongly and irresponsibly, you are not free at all.” An unwillingness of the public to recognize the inherent ineptitude of government in making the correct decisions for individuals is what underlies most of the biggest political blunders of history– from prohibition, to social “security,” to the war on drugs, the war on poverty, the war on terror, and any other wars on abstract nouns we care to dream up. Most people choose to deal in abstracts, ignoring the unintended consequences and inherent violence of government action. Fighting poverty sounds good, but forcibly taking from the industrious to give to those in need is less appealing. Fighting drug use seems like a no-brainer, but “drug use” is an abstract concept that only exists as a shorthand for describing the activities of those who choose to use drugs. The typical politician ignores the injustice of his actions, turning a blind eye to those hurt by the policy he peddles, eager to shake another hand or kiss another baby of someone equally willing to ignore the blatant injustices of a coercive, paternalistic state. To see this phenomenon, this time exhibited by Mitt Romney, but equally practiced by the social planners and statists across the simplistic, one-dimensional political spectrum, click here.

In related news, Ron Paul did not fair quite as well with the pro-war Florida crowd as with crowds past, receiving more boos than any candidate other than Hillary Clinton. It seems the Republican party is suffering from what HBS professor Clayton Christensen calls the “Innovators Dilemma“– the phenomenon of businesses catering so closely to their existing customer base, that they lose sight of the unmet needs of the population as a whole, and are subsequently displaced by new, innovative technologies. In this case, everyone but Paul insists on pandering to the largely pro-war republican base, while losing sight of the vast majority of Americans that wants it to end (and fast– sorry, Hillary; no decade-long pull-out strategy will do). Will the Republican party insist on throwing away an election on an already lost (and virtually unwinnable) war? Probably not– whoever wins the nomination will likely have a convenient change of heart and start talking a lot more about getting out of Iraq after the primaries.

Posted in 2008 Presidential Race, Current Events, Politics, Ron Paul | Tagged: , , , , , , | 2 Comments »

John Mayer endorses Ron Paul?

Posted by Poorsummary on October 17, 2007

Ok…so “endorses” is a bit of a stretch, but he does say he’s talking about Ron Paul and advocates reading the constitution. After all, “there’s a lot of healing in there.”

But seriously, it’s high time some high-profile celebrities start thinking about endorsing Ron Paul. Name recognition is still one of his biggest obstacles, despite his recent fund raising success both nationally and in New Hampshire. Sure, Barry Manilow has thrown a couple thousand dollars Paul’s way, but a few public statements in support of Paul could be worth millions. Given musicians’ public opposition to the war (remember Dave Matthews’s “Vote for Change” tour?), and Hillary’s confession of a long-term US presence in Iraq, one would think the Ron Paul campaign could get at least a benefit concert or two. As far as I know, even libertarian Drew Carey has yet to get behind the biggest libertarian movement of the decade.

Well guys…if you were waiting for an invitation, this is it. As a DMB and occasional “Who’s Line” fan, I’m ready to see you guys “Vote for Change” by supporting a presidential candidate that stands out from the usual pack of fear mongering, flip-flopping, nanny-state loving, focus-group driven, well oiled political robots. And don’t wait for TMZ to catch you ranting about it drunk outside of a bar with your entourage– although, that could arguably be more interesting than watching another piece on traffic jams.

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