AMA is Wrong About Medicare

http://capmag.com/article.asp?ID=4793

Under current restrictions, it is illegal for the doctor to accept a patient's payment for any amount over the government's approved reimbursement for a service covered by Medicare.
The government also prohibits the patient from being reimbursed by Medicare if the patient chooses to privately contract for services with a doctor who does not accept Medicare.

This is a textbook example of why it's wrong for the government to be the middleman for your dollars. If you were freely exchanging your dollars for medical services, you would be within your right to choose which services, which provider (and thereby, what cost) you prefer. But it's not your dollar anymore, it's a dollar that has passed through the hand of government, somehow "sanctifying" it from the taint of profit or greed before being handed to the provider of services you desire.

Unfortunately for you, because you are not the one exchanging the dollar for services anymore, you no longer have the power to negotiate the terms of that exchange (unlike your ability to choose which breakfast cereal you purchase - ironically a real factor in your health). Your options for exchange consist of trying to game the tax system to your benefit, and punching a ballot every now and then to decide who will be your personal benevolent tyrant for a season.

Also working against you is the fact that since your money has been pooled together with everyone else's before reaching this point of medical services, it falls upon the representatives of the People to make sure your best interests (as they define it) are served in this exchange. Unsurprisingly, every incident that brings harm to one becomes a reason to legislate for all - since the only way, in this situation, to keep harm from coming to the one again is to codify the incident into preventative law, transferring the effects of that exchange from one to all. How else could a victim be protected if the terms of their exchanges are dictated by government?

The thousands of pages of directives and regulations dictating the use of what has now become "public money" on your behalf is no different than a hypothetical "government-sanctioned grocery list", posted on the doors of every store, specifying the items you may buy, at what price, and from whom. It would also be illegal in this bizarro world for the grocer to accept any of your personal dollars for his business with you would be funded by the state. Only a selfish, greedy rich person would ever need or want more than the benevolent tyrants had provided.

Would you be surprised to see the shelves eventually sparse and then empty for lack of products to sell? (as all the producers of products chose to do business elsewhere where they could set their own prices with the buyers) Would you be surprised to see lines of disgruntled shoppers, each carrying their apportioned groceries through the "free checkout line"?

We can't forget that medical products and services are not intrinsically different from any other product or service. They must to be bought and sold, and replacing personal choice with government fiat doesn't "wash the (supposed) stain of profit" from the product one buys. That doctor must choose to provide a service, just like the hairdresser - or he is a slave. Those drugs must be manufactured by human beings, who, devoid of the right to choose their incentive, will cease to do so and seek other means of providing for themselves. Treating medical care any different than "food care" results in a world where food is cheap (for the poor), plentiful (for the multitudes), and profitable (for the producers) - while medicine is expensive, scarce, and undesirable to produce.

And don't tell me health care is different because we need it to survive. Starvation is worse than dying from cancer on my list...

The Fear Factor

http://www.lewrockwell.com/paul/paul402.html

While fear itself is not always the product of irrationality, once experienced it tends to lead away from reason, especially if the experience is extreme in duration or intensity. When people are fearful they tend to be willing to irrationally surrender their rights.

Thus, fear is a threat to rational liberty. The psychology of fear is an essential component of those who would have us believe we must increasingly rely on the elite who manage the apparatus of the central government.

A short essay by Ron Paul that highlights the consequences of speaking, legislating, and governing from a perspective of fear. Fear is the hallmark of socialism - the driving emotional force that motivates people to seek protection from benevolant tyrants - those who would promise that nothing bad will ever happen to good people under their watchful care. Stimulated by crisis, both real and perceived, they advocate the restrictions of freedoms for everyone because of the criminal acts of a few. The mindset always boils down to this - prevent anyone from doing anything bad before they get a chance to do so, and forcibly ensure that everyone does good before they fail to do so...

The Five Stages of Counterfeiting

http://www.lewrockwell.com/north/north550.html

A truly serious counterfeiting operation would in fact plan to do something very similar to what Mr. Heath said a counterfeiter would not do – just not in a single step. The goal of a serious counterfeiting operation would be to persuade the public to use its money rather than the official bills it originally copied when it designed its original fake plates. Its goal would be the replacement of the original official bills with its own bills, making them official in the eyes of the public.

This has been the primary goal of central bankers ever since the creation of the Bank of England in 1694

Gary North's essays are always very detailed and thorough, if a bit lengthy. This article covers a very broad scope of economic history and describes the process of converting generations of people to treasure a currency once thought to be worthless. It covers precious metal debasement, fractional reserve banking, fiat money, central banks, and inflation - all in the context of a larger move to legitimize a counterfeit currency.

Economists on the Loose

http://www.CapMag.com/article.asp?ID=4991

First, let's establish a working definition of free markets; it's really simple. Free markets are simply millions upon millions of individual decision-makers, engaged in peaceable, voluntary exchange pursuing what they see in their best interests. People who denounce the free market and voluntary exchange, and are for control and coercion, believe they have more intelligence and superior wisdom to the masses. What's more, they believe they've been ordained to forcibly impose that wisdom on the rest of us. Of course, they have what they consider good reasons for doing so, but every tyrant that has ever existed has had what he believed were good reasons for restricting the liberty of others.

Tyrants are against the free market because it implies voluntary exchange. Tyrants do not trust that people acting voluntarily will do what the tyrant thinks they ought to do. Therefore, they want to replace the market with economic planning, or as Professor Blinder calls it — industrial policy.

A short and simple essay on the basic philosophy of the free market economy vs. central planning/industrial policy. I love Walter Williams ability to concisely demonstrate the mindset that inspires both the capitalist and socialist movements.

Where Michael Moore is Wrong

http://www.realclearpolitics.com/articles/2007/07/where_michael_moore_is_wrong.html

America's medical system has problems, but profit is the least of it. Government mandates, overregulation and a tax code that pushes employer-paid health insurance prevent the free market from performing its efficient miracles. Six out of seven health-care dollars are spent by third parties. That kills the market. Patients rarely shop around, and doctors rarely compete on price or service.

Private competitors innovate or die. Government workers do what they did last year. That's why I want the private sector to provide my health care. Pursuit of profit will give us our best medicines and medical devices.

I'll pay you $1,000 if you can name one thing government does more efficiently than the private sector.

Third in a series on articles by John Stossel on his interaction with Michael Moore. In it he disputes more claims of how government does a better job of providing services than the private sector. Moore's popular belief that certain services shouldn't be "tainted" by profit is deceptive - and attractive to those who don't understand what profit truly is.

Bill Gates Needs an Econ Course

http://www.realclearpolitics.com/articles/2007/06/bill_gates_needs_an_econ_cours.html

At Harvard, Gates said, "We can make market forces work better for the poor if we can develop a more creative capitalism -- if we can stretch the reach of market forces so that more people can make a profit, or at least make a living, serving people who are suffering from the worst inequities."

He misses the point. Gates faults the free market for problems caused by governments. What constricts the reach of the free market is the state. Gates seems oblivious to all the ways that governments here and abroad cripple enterprise. In poor countries, corrupt bureaucracies smother entrepreneurship while enriching cronies. The lack of formal property rights and stable law keeps average people from accumulating capital. So the poor stay poor. That's what causes "scarcity of clean water" and kills "children who die from diseases we can cure."

John Stossel takes Gates to task for confusing the root causes of poverty. Once again, the only-somewhat-informed public debate looks at free markets, looks at suffering, and then determines that the free market has failed, and therefore the State should intervene (or more accurately, since it has been intervening already, it should improve its intervention).

Gates' statement at the end of this article, "We also can press governments around the world to spend taxpayer money in ways that better reflect the values of the people who pay the taxes" is especially telling. The idea that somehow problems would be solved if we just did the wrong thing in a better way is futile. Ignoring the underlying truth that individuals know best how to spend their money does the poor a disservice. The arrogant assumption that the poor - or anyone - would be better off if a benevolent dictator would take their resources and then wisely dispose of them for the greatest benefit of their former owner is a gross deception. I'm baffled that such an idea is so widely accepted...

Cartels: Economists and Central Bankers

http://www.lewrockwell.com/north/north546.html

Economics as a science is seen by its practitioners as having progressed by identifying more and more institutions as governed by personal self-interest. Yet when economists come to banking and education, they refuse to extend this traditional analysis. They either remain silent or invoke the mantra of public interest.

You will search in vain for a chapter on education as an oligopoly within the context of tax-funding, laws mandating education up to age 16, and government licensing of college-accreditation agencies. Somehow, economics textbook authors skip over any analytical discussion of this, the largest sector of the American economy.

Gary North asks some pointed questions in this essay, where he reveals the lack of critical examination on the part of economists when it comes to things like the Federal Reserve. He outlines the obvious contradictions and deceptions being practiced that for some reason, no one ever bothers to question (don't ask, don't tell).

The Romantic Illusion of Universal Health Care

I found all these short essays on CapMag on the same day - so it seemed appropriate to bundle them together and share them here to counter the ignorance I hear every day about Universal Health Care. It's gotten to where the phrase is used as a litmus test - you're either for it or against it (like the abortion issue). Even more perversely, the public consensus has judged that UHC is inherently good (who could possibly be against caring for people?), it is inevitable (everyone else is doing it!), and it is only being held up by selfish, heartless, greedy people (if you're not in favor of the Patriot Act, you must be a traitor!).

Universal Health Care Freedom on the Fourth of July
http://capmag.com/article.asp?ID=4983

The talk about a "right" to health care really means that no one should have the right to any health care at all except through the government. As we celebrate the Fourth of July this year we must remember that our right to manage our own health care as we see fit is as vital to our liberty as freedom of speech or freedom of the press.

Why Health Insurance Should Not Be Universal
http://capmag.com/article.asp?ID=4984

Power-hungry politicians feed off the irrationality of the citizenry. If the citizenry were more rational, there would be no place in the political system for politicians who value power over freedom and justice. Today's problems with medical care are the fault of the people who want the results of capitalism while instructing their leaders to install more socialism.

All Power to the Post Office
http://capmag.com/article.asp?ID=4981

During a recent interview, a talk radio host told me that all private health insurance should be eliminated in order to give us all a reason to work together to make sure the government runs a good health care system.
A better analogy would be that conditions in our prisons might be expected to improve if we were all required to live in them. Socialists and some Liberals would find this level of government-enforced uniformity to be a noble sacrifice to which all citizens must submit. Many Conservatives would reluctantly agree—but suggest a voucher system that would allow us each to select the prison cell of our choice.

Health Care's A Mess--So What's the Solution?
http://capmag.com/article.asp?ID=4980

It's better to consider the possibility that the market didn't fail us in medical care...but it was never allowed to function. If you don't want more of the same, which universal government coverage and control will provide, then consider something radically different: freedom in health care.

Freedom and Benevolence Go Together

http://www.realclearpolitics.com/articles/2007/07/freedom_and_benevolence_go_tog.html

I interviewed Michael Moore recently for an upcoming "20/20" special on health care. It's refreshing to interview a leftist who proudly admits he's a leftist. He told me that government should provide "food care" as well as health care and that big government would work if only the right people were in charge...

Moore followed up with a religious lesson. "What the nuns told me is true: We will be judged by how we treat the least among us. And that in order to be accepted into heaven, we're gonna be asked a series of questions. When I was hungry, did you feed me? When I was homeless, did you give me shelter? And when I was sick, did you take care of me?"

I'm not a theologian, but I do know that when people are ordered by the government to be charitable, it's not virtuous; it's compelled. Why would anyone get into heaven because he pays taxes under threat of imprisonment? Moral action is freely chosen action.

This is textbook socialist thinking - first, that government control is the best solution to the society's ills, when lead by the "right people"; second, that because it is right to do something, people should therefore be forced to do so. While people will argue about the results (charity doesn't cover everyone / civilized society should be like this / etc.), they ignore the moral contradiction of being compelled to do what's right. The first attack on those who stand on principle and advocate individual freedom and responsibility is that such people are cold-hearted and unsympathetic of other's suffering. They champion the "charity" of their forced programs and claim the lover of liberty has no love for his fellow man. Unfortunately, many people believe this rhetoric and end up believing that to advocate freedom is to be against charity. Nothing could be farther from the truth...

Time for Another Revolution

http://www.mises.org/story/2633

In 1913 the relationship between the State and Society was reversed. Areas which had heretofore been considered within the private domain, sacred ground so to speak, were now invaded by the arrogant and enriched State, and within thirty years the individual was squeezed into a corner so small that even his soul lacked elbow room. His case was far worse than it was in 1776; in exchange for an income tax King George III would have conceded every point made against him by the colonists, and might even have done penance for past sins. But, such was the character of these Americans that they challenged him to battle because he presumed to impose a miserable tax on tea. What they won at Yorktown was lost by their offspring one hundred and thirty-two years later.

Were the disposition of the current crop of Americans comparable to that of their forbears, a new revolution, to regain the profit of the first one, would be in order. There is far more justification for it now than there was in 1776. But, people do not do what reason dictates; they do what their disposition impels them to do. And the American disposition of the 1950s is flaccidly placid, obsequious and completely without a sense of freedom; it has been molded into that condition by the proceeds of the Sixteenth Amendment. We are Americans geographically, not in the tradition. In the circumstances, a return to the Constitutional immunities must wait for a miracle.

An excellent essay on the need for a revolution - as great a need as existed at the birth of our nation. Too many people are ignorant of the Constitution - its purpose, its principles, and even its weaknesses and why they exist. It all sounds too anachronistic to be taken seriously today. Defenders of the Constitution are seen as blind nostalgic cultists, out of touch with modernity. That's easy to believe when you don't understand the philosophical and moral challenges of our day, let alone the historical context (and the amazing similarities).

Frank outlines the foundations of the Constitution, the social struggle, the loss of liberty, and the slow erosion of protections against the powers of the State. The entire book can be downloaded for free here.

The Myth of the Rational Voter

http://www.economist.com/world/na/displaystory.cfm?story_id=9340166

Instead, he identifies four biases that prompt voters systematically to demand policies that make them worse off. First, people do not understand how the pursuit of private profits often yields public benefits: they have an anti-market bias. Second, they underestimate the benefits of interactions with foreigners: they have an anti-foreign bias. Third, they equate prosperity with employment rather than production: Mr Caplan calls this the “make-work bias”. Finally, they tend to think economic conditions are worse than they are, a bias towards pessimism.

The make-work bias is best illustrated by a story, perhaps apocryphal, of an economist who visits China under Mao Zedong. He sees hundreds of workers building a dam with shovels. He asks: “Why don't they use a mechanical digger?” “That would put people out of work,” replies the foreman. “Oh,” says the economist, “I thought you were making a dam. If it's jobs you want, take away their shovels and give them spoons.” For an individual, the make-work bias makes some sense. He prospers if he has a job, and may lose his health insurance if he is laid off. For the nation as a whole, however, what matters is not whether people have jobs, but how they do them. The more people produce, the greater the general prosperity.

A good essay exposing the myth that democracy always results in the best choice for all involved (wisdom of crowds, etc.) He outlines four factors that cause voters to act irrationally. In a democracy, he claims, rational politicians give the voters what they (irrationally) want.

Live and Let Live

http://jewishworldreview.com/0707/stossel070507.php3

That same week I happened to interview filmmaker Michael Moore for "20/20." Moore wants government to monopolize health care. His new film, "Sicko," argues that Canada and France approach paradise because their governments provide health care and more. This brought him standing ovations in Cannes.

"But government is force," I said to him. He was incredulous.
Michael Moore: Why do you see it as force?
Me: Because government takes money with force from people and gives it to others.
Moore: No, it doesn't, actually. The government is of, by, and for the people. The people elect the government, and the people determine whether or not they'll allow the government to collect taxes from them.

Is it really necessary to explain that government is force? When the Salvation Army asks you for a donation, you are free to say no, and you suffer no consequences. When the U.S. government demands a tax return and a check on April 15, you can't say no and go about your business. You comply or face fines or imprisonment. Yes, you get to vote for candidates periodically. But having an infinitesimal say in who will coerce you doesn't change that fact that they are using force.

John Stossel is very good at identifying the principles that most people miss when discussing the latest hot-button issues. The universal health care debate is full of misdirection and illusion, and a lot of passionate people championing popular causes while ignoring the foundation of their philosophy. Michael Moore's total absence of awareness about the true nature of any collectivist policy leaves me dumbfounded (yet not totally suprised). When people like him are making sweeping statements in the media that ignore principles, I get worried - it means the public debate is fueled by ignorance.

Walking Through the Looking Glass

http://www.freecapitalist.com/columnists/koerber_archives.php?id=13

What's the difference between failure and prosperity? How can you be sure you are headed in the "right" direction? Is it even possible to chart a course to live the abundant and prosperous life? Is it just an age-old gimmick to trick the naïve and unsuspecting entrepreneur into believing that the American dream is still a possibility? Can an honest person actually make it "big" in the business world?

To anyone with any substantial ambition whatsoever, these questions-and many related to them-are very important. To me, it has been very surprising indeed how I have come to learn the answers to these questions over the last few years.

I have learned that prosperity is not about some external event or some lucky opportunity. Prosperity is about a choice and the subsequent change that starts from within. It is literally like "walking through the looking glass" and seeing a world that so many people never see because of their own fears. I add my voice to those who have gone before me and say, "I too have walked through the looking glass and see a new way of life."

So what happened that enabled me to walk through the looking glass? Did I get lucky? Was I in the right place at the right time? Did I find a partner with a lot of money? No. None of these have anything to do with my success. The fact that I used to think in a way to even conceive such possible explanations for success is almost frightening to me.

This a great essay by Rick Koerber, where he outlines the journey of his failure and success, and describes what made the difference between the two. An excellent introduction to changing you perspective from scarcity to prosperity.

Health Care Is a Business - or Should Be

http://www.capmag.com/article.asp?ID=4948

Ultimately all health care is paid for by business activity. Business provides the wages, the return on investment, the insurance, the taxes that pay directly for health care, and the insurance and taxes that fund government programs. When the government manages to provide services at all, it can give you nothing that it does not take from you or others, or from your employer and other employers. The total added value the government creates for your benefit is nothing.

The government now uses your money to pay for 50 percent of health care. That is up from less than 10 percent, forty years ago. The increase in health care costs that has accompanied this process is largely caused by government—the actual origin of the "health care crisis," discovered and proclaimed by Richard Nixon and Edward Kennedy in 1971. Their proposed solution was more government. They got it.

The "crisis" was created by government, not just through its own reckless spending, but through the consequent destruction of much of the free market.

Socialism, Free Enterprise, and the Common Good

http://www.hillsdale.edu/imprimis/2007/05/

In chapter 21 of St. Matthew’s Gospel, Jesus proposes a moral dilemma in the form of a parable: A man asks his two sons to go to work for him in his vineyard. The first son declines, but later ends up going. The second son tells his father he will go, but never does. “Who,” Jesus asks, “did the will of his father?” Although I am loath to argue that Jesus’s point in this parable was an economic one, we may nonetheless derive from it a moral lesson with which to evaluate economic systems in terms of achieving the common good.

Modern history presents us with two divergent models of economic arrangement: socialism and capitalism. One of these appears preoccupied with the common good and social betterment, the other with profits and production. But let us keep the parable in mind as we take a brief tour of economic history.

This essay is adapted from a speech delivered at Hillsdale College on October 27, 2006, at the first annual Free Market Forum, sponsored by the College’s Center for the Study of Monetary Systems and Free Enterprise.

It makes a thorough argument about what I have often observed in the struggle between capitalism and socialism - that of the difference between the public perception of a philosophy and the actual consequences of the same.

When Talk Isn't Cheap

http://www.opinionjournal.com/diary/?id=110010006

Washington's highest court struck down a decision by Superior Court Judge Chris Wickham, who in 2005 ordered KVI radio hosts John Carlson and Kirby Wilbur had to place a monetary value on "campaign contributions" they made when they argued in favor of Initiative 912, a ballot measure to repeal a 9.5-cent-a-gallon increase in the state's gasoline tax. The antitax measure ultimately lost by 6% of the vote, in part because its opponents outspent its supporters by 20 to 1.

But the "unofficial" support of the measure by talk-show hosts such as Messrs. Carlson and Wilbur, who went so far as to actively tell listeners how they could sign petitions to get I-912 on the ballot, infuriated the self-styled Keep Washington Rolling coalition, which backed the gas tax hike. The coalition convinced a local prosecutor in San Juan County, along with the cities of Kent, Auburn and Seattle, to sue KVI radio demanding that it be brought under the state's campaign finance laws.

In siding with the localities, Judge Wickham insisted he was not restricting speech, merely requiring the reporting of "in kind" contributions to the antitax campaign. But in fact he was equating speech to money, for these "contributions" consisted entirely of speech.

Read to see where our political system is headed...

The Best Way to Save the Earth? Capitalism

http://www.lewrockwell.com/murphy/murphy112.html

Although the friends of the planet might disagree on what they’re for – some care most about the quality of the air we breathe, some want to preserve endangered species, and some extremists wish human beings would leave the scene altogether – they all know what they’re against: capitalism.

Whether the alleged solutions are taxes on gasoline, fines for smokestack pollution, or stepped up enforcement of fishing quotas, the common thread is that free individuals cannot be entrusted to make wise decisions with their private property. Benevolent politicians (taking their cue from the environmentalist experts, of course) must use the power of the government to alter people’s behavior.

So far I’m saying nothing controversial. The tradeoff between jobs and the spotted owl is familiar to all, and indeed the typical environmentalist relishes the material sacrifice necessary to make amends with Mother Nature. (After all, you can’t properly atone for past sins without a little suffering.) But what most people don’t realize is that unbridled capitalism is the best way to achieve the environmentalists’ objectives.

Why are people so easily lead to believe that the government and all its encumbent bureaucracy can do a better job than the self-interested, ruthlessly efficient free market? Has anyone checked the historical record?

I love the irony in this article - those crying for the protection of nature are at the same time demanding that no one have any vested interest in nature (i.e., private ownership), but somehow they expect other people to value natural resources the same way they value their own property. It just doesn't work. All those good intentions are powerless - which is why those with such intentions look to the power of government to force people to act as their intentions would have others act.

Panama Has No Central Bank

http://www.mises.org/story/2533

For a real-world example of how a system of market-chosen monetary policy would work in the absence of a central bank, one need not look to the past; the example exists in present-day Central America, in the Republic of Panama, a country that has lived without a central bank since its independence, with a very successful and stable macroeconomic environment.

The absence of a central bank in Panama has created a completely market-driven money supply. Panama's market has also chosen the US dollar as its de facto currency. The country must buy or obtain their dollars by producing or exporting real goods or services; it cannot create money out of thin air. In this way, at least, the system is similar to the old gold standard. Annual inflation in the past 20 years has averaged 1% and there have been years with price deflation, as well: 1986, 1989, and 2003.

This is a short essay about the argument that we don't need a "federal reserve" or central bank. It doesn't go into a lot of detail about the pitfalls of a central banking system and fiat currency, but it references them clearly. National financial systems can seem horribly complex - and they usually are, when a government agency, beholden to politicians, instead of shareholders, contols monetary policy. Panama provides a good example of how a free market banking system would work.

Security and Liberty

http://www.lewrockwell.com/paul/paul383.html

... The Virginia Tech tragedy may not lead directly to more gun control, but I fear it will lead to more people control. Thanks to our media and many government officials, Americans have become conditioned to view the state as our protector and the solution to every problem. Whenever something terrible happens, especially when it becomes a national news story, people reflexively demand that government do something. This impulse almost always leads to bad laws and the loss of liberty. It is completely at odds with the best American traditions of self-reliance and rugged individualism.

... Freedom is not defined by safety. Freedom is defined by the ability of citizens to live without government interference. Government cannot create a world without risks, nor would we really wish to live in such a fictional place. Only a totalitarian society would even claim absolute safety as a worthy ideal, because it would require total state control over its citizens’ lives. Liberty has meaning only if we still believe in it when terrible things happen and a false government security blanket beckons.

After the Virginia shootings, the age-old debate is once again on the front page: "if we would just ban the guns, these things wouldn't happen" vs. "if the people had been allowed to be armed, they could have defended themselves". Every tragedy brings the same argument of state control vs. self-control (both for the criminal and the victim). Ron Paul makes a great statement here about the true definition of Freedom, and the unseen risks that come with ceding our responsibility to the state.

"The mania for giving the Government power to meddle with the private affairs of cities or citizens is likely to cause endless trouble, through the rivalry of schools and creeds that are anxious to obtain official recognition, and there is great danger that our people will lose our independence of thought and action which is the cause of much of our greatness, and sink into the helplessness of the Frenchman or German who expects his government to feed him when hungry, clothe him when naked, to prescribe when his child may be born and when he may die, and, in time, to regulate every act of humanity from the cradle to the tomb, including the manner in which he may seek future admission to paradise."

-- Mark Twain