What is Austrian Economics?

Thursday, December 31, 2009

The story of the Austrian School begins in the fifteenth century, when the followers of St. Thomas Aquinas, writing and teaching at the University of Salamanca in Spain, sought to explain the full range of human action and social organization.

These Late Scholastics observed the existence of economic law, inexorable forces of cause and effect that operate very much as other natural laws. Over the course of several generations, they discovered and explained the laws of supply and demand, the cause of inflation, the operation of foreign exchange rates, and the subjective nature of economic value--all reasons Joseph Schumpeter celebrated them as the first real economists.

The Late Scholastics were advocates of property rights and the freedom to contract and trade. They celebrated the contribution of business to society, while doggedly opposing taxes, price controls, and regulations that inhibited enterprise. As moral theologians, they urged governments to obey ethical strictures against theft and murder. And they lived up to Ludwig von Mises's rule: the first job of an economist is to tell governments what they cannot do.

The first general treatise on economics, Essay on the Nature of Commerce, was written in 1730 by Richard Cantillon, a man schooled in the scholastic tradition. Born in Ireland, he emigrated to France. He saw economics as an independent area of investigation, and explained the formation of prices using the "thought experiment." He understood the market as an entrepreneurial process, and held to an Austrian theory of money creation: that it enters the economy in a step-by-step fashion, disrupting prices along the way.

Cantillon was followed by Anne Robert Jacques Turgot, the pro-market French aristocrat and finance minister under the ancien regime. His economic writings were few but profound. His paper "Value and Money" spelled out the origins of money, and the nature of economic choice: that it reflects the subjective rankings of an individual's preferences. Turgot solved the famous diamond-water paradox that baffled later classical economists, articulated the law of diminishing returns, and criticized usury laws (a sticking point with the Late Scholastics). He favored a classical liberal approach to economic policy, recommending a repeal of all special privileges granted to government-connected industries.

More at: http://mises.org/etexts/austrian.asp

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Prepare to get naked.

Wednesday, December 30, 2009

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Chase and Citibank to Drop Out of FDIC Coverage Program

Chase and Citibank announced via their websites that they are no longer participating in (Federal Deposit Insurance Company) FDIC Transaction Account Guarantee Program. Both banks are still insured under the general FDIC program, however.
What is the FDIC? It’s the government entity that makes it safer to keep your money in the bank rather than stuff it in a mattress. In the case of a bank failure, your funds deposited in that failed bank are guaranteed and will be returned to you. From the FDIC website:

The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the United States government that protects funds depositors place in banks and savings associations. FDIC insurance is backed by the full faith and credit of the United States government. Since the FDIC was established in 1933, no depositor has ever lost a single penny of FDIC-insured funds.
What does dropping the Transaction Account Guarantee protection mean to you? Actually, you should be pretty scared. Taking a protection away from your hard earned funds is not a good thing. Nor is it a good sign of the health of these banks. Dropping out of the program means that the banks don’t have to be quite as strict with their banking procedures.
What is the difference between coverage under the Transaction Account Guarantee Program and FDIC’s general deposit rules? With the general deposit rules, any account which is covered under the general rules is covered up to $250,000 but above this amount, the funds are not covered. If funds are covered under the Transaction Account Guarantee Program, funds exceeding $250,000 are still covered. It’s sort of double protection.

Read more at:  http://www.creditinfocenter.com/wordpress/2009/12/23/chase-and-citibank-to-drop-out-of-fdic-coverage-program/

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Money and Politics in the Land of Oz

Sunday, December 27, 2009

Here is the extraordinary story behind the extraordinary story of 'The Wonderful Wizard of Oz'. Most of us have seen the movie version of this allegorical tale, but few of us are aware of what the various characters, places and things represented in the mind of Frank Baum, the tale's author. Professor Quentin Taylor of Rogers State University invitingly titles the piece presented below 'Money and Politics in the Land of Oz'. Though 'The Wonderful Wizard of Oz' was written over 100 years ago, the themes will be recongizable to those with an interest in golden matters. Though gold is painted as a villain in Baum's story, it represented then many of the same things fiat money does today. Whereas gold was considered a tool of oppression by the Populists of 1900, it is considered an instrument of financial and personal freedom today. So, as you can see, we have come full circle, and gold has travelled a yellow brick road of its own. Happy reading. --Mike Kosares

Abstract: L. Frank Baum claimed to have written The Wonderful Wizard of Oz "solely to pleasure the children" of his day, but scholars have found enough parallels between Dorothy's yellow-brick odyssey and the politics of 1890s Populism to suggest otherwise. Did Baum intend to pen a subtle political satire on monetary reform or merely an entertaining fantasy?

"The story of 'The Wonderful Wizard of Oz' was written solely to pleasure children of today" (Dighe 2002, 42). So wrote L. Frank Baum in the introduction to his popular children's story published in 1900. As fertile as his imagination was, Baum could hardly have conceived that his "modernized fairly tale" would attain immortality when it was adapted to the silver screen forty years later. Though not a smash hit at the time of its release, The Wizard of Oz soon captured the hearts of the movie-going public, and it has retained its grip ever since. With its stirring effects, colorful characters, and memorable music (not to mention Judy Garland's dazzling performance), the film has delighted young and old alike for three generations. Yet, as everyone knows, The Wizard of Oz is more than just another celluloid classic; it has become a permanent part of American popular culture.

Oz as Allegory

Is Oz, however, merely a children's story, as its author claimed? For a quarter of a century after its film debut, no one seemed to think otherwise. This view would change completely when an obscure high school teacher published an essay in American Quarterly claiming that Baum's charming tale concealed a clever allegory on the Populist movement, the agrarian revolt that swept across the Midwest in the 1890s. In an ingenuous act of imaginative scholarship, Henry M. Littlefield linked the characters and the story line of the Oz tale to the political landscape of the Mauve Decade. The discovery was little less than astonishing: Baum's children's story was in fact a full-blown "parable on populism," a "vibrant and ironic portrait" of America on the eve of the new century (Littlefield 1964, 50).

In supporting this thesis, Littlefield drew on Baum's experience as a journalist before he wrote Oz. As editor of a small newspaper in Aberdeen, South Dakota, BaumBaum had written on politics and current events in the late 1880s and early 1890s, a period that coincided with the formation of the Populist Party. Littlefield also indicated that Baum was sympathetic to the Populist movement, supported William Jennings Bryan in the election of 1896, and, though not an activist, consistently voted for Democratic candidates. (In 1896, the Populists joined the Democrats in backing Bryan's bid for the presidency.) Finally, Littlefield noted Baum's penchant for political satire as evidenced by his second Oz tale, which lampoons feminism and the suffragette movement.

In coupling Baum's political and literary proclivities, Littlefield built on the work of Martin Gardner and Russel B. Nye, who were among the first to take a serious interest in "The Royal Historian of Oz." According to Nye, Baum all but admitted that his writings contained a veiled subtext, confessing his desire to pen stories that would "bear the stamp of our times and depict the progressive fairies of the day" (Gardiner and Nye 1957, 1). For Littlefield, Baum's revelation appeared decisive. Yet even without it, the numerous parallels and analogies between the Oz story and contemporary politics were "far too consistent to be coincidental" (1964, 58). And although the parable remains in a "minor key" and is not allowed to interfere with the fantasy, "the author's allegorical intent seems clear"-that is, to produce "a gentle and friendly Midwestern critique of the Populist rationale" (50, 58, 57).

Read more at: http://www.usagold.com/gildedopinion/oz.html

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Paul Takes Commanding Lead In GOP Race

Tuesday, December 22, 2009

KY Sen Poll: Paul Takes Commanding Lead In GOP Race

The same grassroots energy that propelled Ron Paul from a little-known Congressman to a force in the presidential primaries now seems to be transferring to his son in his Senate run in Kentucky. Public Policy Polling's (D) latest survey shows him easily ahead of Secretary of State Trey Grayson, who was recruited by the national party after Sen. Jim Bunning (R) was pressured not to seek re-election.

Republican Primary Election Matchup
Paul 44
Grayson 25
Und 32

Some of Paul's advantage seems to come from a name-ID edge, somewhat surprising given that Grayson is a statewide officeholder and Paul is a political newcomer.

Favorable Ratings
Grayson 22 / 15
Paul 39 / 13

Read more at:
http://www.realclearpolitics.com/politics_nation/2009/12/ky_sen_poll_paul_takes_command.html

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A New World War for a New World Order

Sunday, December 20, 2009

Introduction

In Part 1 and Part 2 of this series, I have analyzed US and NATO geopolitical strategy since the fall of the Soviet Union, in expanding the American empire and preventing the rise of new powers, containing Russia and China. This Part examines the implications of this strategy in recent years; following the emergence of a New Cold War, as well as analyzing the war in Georgia, the attempts and methods of regime change in Iran, the coup in Honduras, the expansion of the Afghan-Pakistan war theatre, and spread of conflict in Central Africa. These processes of a New Cold War and major regional wars and conflicts take the world closer to a New World War. Peace can only be possible if the tools and engines of empires are dismantled.

Eastern Europe: Forefront of the New Cold War

In 2002, the Guardian reported that, “The US military build-up in the former Soviet republics of central Asia is raising fears in Moscow that Washington is exploiting the Afghan war to establish a permanent, armed foothold in the region.” Further, “The swift construction of US military bases is also likely to ring alarm bells in Beijing.”[1]

In 2004, it was reported that US strategy “is to position U.S. forces along an "arc of instability" that runs through the Caribbean, Africa, the Middle East, the Caucasus, Central Asia and southern Asia. It is in these parts of the world – generally poor, insular and unstable – that military planners see the major future threats to U.S. interests.”[2]

In 2005, it was reported that talks had been going on between the US and Poland since 2002, along with various other countries, “over the possibility of setting up a European base to intercept long-range missiles.” It was further reported that, “such a base would not have been conceivable before Poland joined Nato in 1999.”[3]

In November of 2007 it was reported that, “Russia threatened to site short-range nuclear missiles in a second location on the European Union's border yesterday if the United States refuses to abandon plans to erect a missile defence shield.” A senior Russian “army general said that Iskander missiles could be deployed in Belarus if US proposals to place 10 interceptor missiles and a radar in Poland and the Czech Republic go ahead.” Putin “also threatened to retrain Russia's nuclear arsenal on targets within Europe.” However, “Washington claims that the shield is aimed not at Russia but at states such as Iran which it accuses of seeking to develop nuclear weapons that could one day strike the West.”[4]

This is a patently absurd claim, as in May 2009, Russian and American scientists released a report saying “that it would take Iran at least another six to eight years to produce a missile with enough range to reach Southern Europe and that only illicit foreign assistance or a concerted and highly visible, decade-long effort might produce the breakthroughs needed for a nuclear-tipped missile to threaten the United States.”[5] Even in December of 2007, the National Intelligence Estimate (NIE) released by all 16 US intelligence agencies reported that, “Iran halted its nuclear weapons program in 2003 and that the program remains frozen.”[6]

Russia has concerns not only about missile interceptors in Poland, which it claims are aimed at Russia, but is also concerned about “an advanced missile-tracking radar that the Pentagon wants to place in the Czech Republic.”[7] Further, in 2007, the Guardian reported that, “Russia is preparing its own military response to the US's controversial plans to build a new missile defence system in eastern Europe, according to Kremlin officials, in a move likely to increase fears of a cold war-style arms race.” A Kremlin spokesman said of the Polish missile defenses and the Czech radar system, that, “We were extremely concerned and disappointed. We were never informed in advance about these plans. It brings tremendous change to the strategic balance in Europe, and to the world's strategic stability.”[8]

In May of 2008, it was reported that, “President Dmitri A. Medvedev of Russia and President Hu Jintao of China met ... to conclude a deal on nuclear cooperation and together condemn American proposals for a missile shield in Europe. Both countries called the plan a setback to international trust that was likely to upset the balance of power.”[9]

In July of 2008, the Russian Foreign Ministry said that it “will be forced to make a military response if the U.S.-Czech missile defense agreement is ratified,” and that, “we will be forced to react not with diplomatic, but with military-technical methods.”[10] In August of 2008, the US and Poland reached a deal “to place an American missile defense base on Polish territory.” Russia responded by “saying that the move would worsen relations with the United States.”[11] Russia further said “the US had shown that Russia was the true target of the defensive shield, as tension between the two powers continued to rise over the conflict in Georgia.” The Deputy Head of Russia’s general staff “warned that Poland was making itself a target for Russia's military.”[12]

It was further reported that, “General Anatoly Nogovitsyn said that any new US assets in Europe could come under Russian nuclear attack with his forces targeting ‘the allies of countries having nuclear weapons’,” and that, “Such targets are destroyed as a first priority.”[13]

In April of 2009, Obama said, “that the U.S. missile defense system in the Czech Republic and Poland will go forward.”[14] In May of 2009, Russia said that it “could deploy its latest Iskander missiles close to Poland if plans to install U.S. Patriots on Polish soil go ahead.”[15] In July of 2009, Russian President Medvedev said that, “Russia will still deploy missiles near Poland if the US pushes ahead with a missile shield in Eastern Europe.”[16]

Iran and the China-Russia Alliance

The Bush regime used hostile rhetoric against Iran, threatening possible war against the country. However, Iran will not be in any way similar to the military adventurism seen in Iraq. A war against Iran will bring China and Russia to war with the west. Chinese and Russian investments with Iran, both in terms of military cooperation as well as nuclear proliferation and energy ties, have driven the interests of Iran together with those of China and Russia.

Read more at: http://www.lewrockwell.com/orig10/marshall5.1.1.html

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The Judge: Rights vs. goods

Saturday, December 19, 2009

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The Feds Are Addicted to Pot – Even If You Aren't

Friday, December 18, 2009

Marijuana's addiction potential may be no big deal, but it's certainly big business.

According to a widely publicized 1999 Institute of Medicine report, fewer than 10 percent of those who try cannabis ever meet the clinical criteria for a diagnosis of "drug dependence" (based on DSM-III-R criteria). By contrast, 32 percent of tobacco users and 15 percent of alcohol users meet the criteria for "drug dependence."

Nevertheless, it is pot – not booze or cigarettes – that has the federal government seeing red and clinical investigators seeing green. As I reported for Alternet last year, the National Institute on Drug Abuse (NIDA) – which overseas more than 85 percent of the world's research on controlled substances – recently appropriated some $4 million in taxpayers' dollars to establish the nation's first-ever "Center on Cannabis Addiction." It's mission: to "develop novel approaches to the prevention, diagnosis and treatment of marijuana addiction."

Of course, what good is a research center if it isn't conducting clinical research? To this end, the U.S. National Institutes of Health recently made millions of dollars in grant funding available "to support research studies that focus on the identification, and preclinical and clinical evaluation, of medications that can be safe and effective for the treatment of cannabis-use and -induced disorders."

According to NIH's request for applications: "Cannabis-related disorders (CRDs), including cannabis abuse or dependence and cannabis induced disorders (e.g., intoxication, delirium, psychotic disorder, and anxiety disorder), are a major public health issue. ... Nearly one million people are seeking treatment for marijuana dependence every year and sufficient research has been carried out to confirm that the use of cannabis can produce serious physical and psychological consequences.

"Currently, there are no medications approved by the Food and Drug Administration for the treatment of CRDs. Given the extent of the use of cannabis in the general population, and the medical and psychological consequences of its use, ... there is a great public health need to develop safe and effective therapeutic interventions. The need to develop treatments targeting adolescents and young adults is particularly relevant in view of their disproportionate use patterns."

Sounds dire, huh? It's meant to. But as usual, the Devil is in the details.

First, there's the issue of the so-called "one million people seeking treatment for marijuana dependence." Or not. According to the U.S. Department of Health and Human Services (HHS), Office of Applied Studies, Substance Abuse Mental Health Services Administration (SAMHSA), the actual number of persons seeking drug treatment for marijuana "as a primary substance at admission" in 2007 (the most recent year for which data is available) was 287,933. Still a large total to be sure, but even this tally is highly misleading. Think these folks are seeking treatment for pot "dependence?" Think again.

Continue at: http://www.lewrockwell.com/armentano-p/armentano-p44.1.html

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Person of the Year: Ron Paul

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Lord Monckton adresses a Greenpeace-campaigner on global warming

Sunday, December 13, 2009

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How to Fix Health Care: Lasik Surgery For The Medical Debate

Saturday, December 12, 2009

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John Stossel on Global Warming

Tuesday, December 1, 2009

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TSA and Its Brethren

TSA and Its Brethren

Going in a Bad Direction Without Wanting To
By Fred Reed ( http://www.fredoneverything.net/TSA.shtml )

After hearing acount after account from friends and acquaintances of rude and sometimes abusive behavior by federal officials in Immigrations, TSA, and others, I spoke by telephone to a fellow at TSA in Washington. He was agreeable and helpful, which is not a response one always gets in the capital. Anyway, I subseqquently wrote him a letter, reproduced below, which addresses matters that in the past have been of interest to readers.

Dear Mr. ,

After our conversation of last week (and I appreciated your taking the time) I thought carefully about the problem of “TSA”—which, as I mentioned, has become a catch-all world for everything people don’t like about governmental intrusion on traveling. It is true that in airports the emigrations officers are much more obnoxious than the genuine TSA personnel.

I discussed the matter with a group of friends who, like me, are roughly in their mid-sixties—that is, who remember the United States as it was years ago. We agreed that we are seeing an anger in the United States, chiefly directed at government, that is new to us. There was widespread anger during the war in Vietnam, but it was directed at the war, not the government in general. Today we have something different.

There is a sense that the government now is not only hostile to the public, which it never was before, but out of control. The degree of intrusiveness has grown from almost none to almost unrestrained—or so people feel.

A few examples:

It is widely assumed by sane and educated people that NSA monitors all email; whether this is true I am not sure, but it is believed. Habeas corpus seems to have gone away. The Fourth Amendment no longer seems to exist, “random” searches on the street being legal. Finances are tracked. You can’t buy a commuter train ticket without a governmental ID, information from which goes into a computer (my experience on MARC).

Read the rest at : http://www.fredoneverything.net/TSA.shtml

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Michael Badnarik on Liberty

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The Philosophy of Liberty.

http://www.isil.org/resources/philosophy-of-liberty-english.swf

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