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Monthly Archives: June 2008

State govts. try to raise gas tax

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randazzo06282Here’s a novel idea: Considering the high cost of gas these days, the government should raise the gas tax. Sounds too unbelievable?

The Virginia state senators passed a resolution raising the state gas tax another 6 cents.  Though Republicans in the House of Delegates are determined to stop the resolution there, the measure highlights a continuing trend across the country. As crude oil prices spike past $140 per barrel, even the government seems unable to help the problem.

Los Angeles Mayor Antonio Villaraigosa announced Wednesday that he wants a half-cent increase for his city. West Virginia has a planned 6-cent gas tax increase scheduled for January 1, 2009. Even New Jersey, with the nations third lowest gas tax rate, is hesitantly considering a hike.

Governments claim they need the gas money to fund new transportation projects. Lawmakers blame the oil companies for the high prices, and many don’t feel government work should stop just because business “greed” has set a high price.

A look at the statistics though, shows that it’s actually state and federal treasuries who earn more—twice as much over the past 25-years—from tax revenues than the big oil companies do from their profits.  While Exxon and their bandit gang have been earning their billions, the government has been taking in trillions.

Democratic candidate Barack Obama supports the current federal gas taxes, and has called for more corporate taxes on the oil companies themselves. He said earlier this month, “I’ll make oil companies like Exxon pay a tax on their windfall profits and we’ll use the money to help families pay for their skyrocketing energy costs and other bills,” though it’s unclear how he’ll keep those companies from passing on their increased costs to the consumer at the pump.

Karl Rove countered Obama further in a Wall Street Journal op-ed June 20. He said that oil companies only make about 8.3-cents in gross profit from each dollar sale. The electronics industry’s 14.5-cent profit per dollar sale and the Microsoft margin at 27.5-cents.

On the flip side of the issue, John McCain has proposed an 18.5-cent cut in gasoline rates and a 24.5-cent cut on diesel fuel, which will bring in less money for the government and hypothetically force it to curb spending.  And ignoring its fellow states, Arkansas voted down a fuel tax increase, instead choosing to issue bonds to fund its road projects.

 
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Posted by on June 30, 2008 in Uncategorized

 

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Bible, Economics and Capitalism

     
Written by Kerby Anderson   
 

Introduction

In this article, we are going to be developing a Christian view of economics. Although most of us do not think of economics in moral terms, there has (until the last century) always been a strong connection between economics and Christian thought.

If you look at the Summa Theologica of Thomas Aquinas, you find whole sections of his theological work devoted to economic issues. He asked such questions as: “What is a just price?” and “How should we deal with poverty?”

Today, these questions, if they are even discussed at all, would be discussed in a class on economic theory. But in his time, these were theological questions that were a critical and integral part of the educational curricula.

In the Protestant Reformation, we find the same thing. In John Calvin’s Institutes of the Christian Religion, whole sections are devoted to government and economics. So Christians should not feel that economics is outside the domain of Christian thinking. If anything, we need to recapture this arena and bring a strong biblical message to it.{1}

In reality, the Bible speaks to economic issues more than any other issue. Whole sections of the book of Proverbs and many of the parables of Jesus deal with economic matters. They tell us what our attitude should be toward wealth and how a Christian should handle his or her finances. The Bible also provides a description of human nature, which helps us evaluate the possible success of an economic system in society.

The Bible teaches that there are two aspects to human nature. First, we are created in the image of God and thus able to control the economic system. But second, human beings are sinful and thus tend towards greed and exploitation. This points to the need to protect individuals from human sinfulness in the economic system. So Christians have a much more balanced view of economics and can therefore construct economic theories and analyze existing economic systems.

It is important for Christians to think about the economic arena. It is a place where much of everyday life takes place, and we can evaluate economics from a biblical perspective. When we use the Bible as our framework, we can begin to construct a government and an economy that liberates human potentiality and limits human sinfulness.

Economics and Human Nature

When we are looking at either theories of government or theories of economics, an important starting point is our view of human nature. This helps us analyze these theories and predict their possible success in society. Therefore, we must go to the Scriptures to evaluate the very foundation of each economic theory.

First, the Bible says that human beings are created in the image of God. This implies that we have rationality and responsibility. Because we have rationality and volition, we can choose between various competing products and services. Furthermore, we can function within a market system in which people can exercise their power of choice. We are not like the animals that are governed by instinct. We are governed by rationality and can make meaningful choices within a market system.

We can also assume that private property can exist within this system because of the biblical idea of dominion. In Genesis 1:28, God says we are to subdue the earth and have dominion over the creation. Certainly one aspect of this is that humans can own property in which they can exercise their dominion.

Since we have both volition and private property rights, we can then assume that we should have the freedom to exchange these private property rights in a free market where goods and services can be exchanged.

The second part of human nature is also important. The Bible describes the fall of the world and the fall of mankind. We are fallen creatures with a sin nature. This sinfulness manifests itself in selfishness, greed, and exploitation. Thus, we need some protection in an economic system from the sinful effects of human interaction.

Since the Bible teaches about the effects of sinful behavior on the world, we should be concerned about any system that would concentrate economic power and thereby unleash the ravages of sinful behavior on the society. Christians, therefore, should reject state-controlled or centrally controlled economies, which would concentrate power in the hands of a few sinful individuals. Instead, we should support an economic system that would disperse that power and protect us from greed and exploitation.

Finally, we should also recognize that not only is human nature fallen, but the world is fallen. The world has become a place of decay and scarcity. In a fallen world, we have to be good managers of the limited resources that can be made available in a market economy. God has given us dominion over His creation, and we must be good stewards of the resources at our disposal.

The free enterprise system has provided the greatest amount of freedom and the most effective economic gains of any economic system ever devised. Nevertheless, Christians often wonder if they can support capitalism. So the rest of this article, we are going to take a closer look at the free enterprise system.

Capitalism: Foundations

Capitalism had its beginning with the publication of The Wealth of Nations, written by Adam Smith in 1776. He argued that the mercantile economic system working at that time in Great Britain was not the best economic foundation. Instead, he argued that the wealth of nations could be increased by allowing the individual to seek his own self-interest and by removing governmental control over the economy.

His theory rested on three major premises. First, his system was based upon the observation that people are motivated by self-interest. He said, “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.” Smith went on to say that “neither intends to promote the public interest,” yet each is “led by an invisible hand to promote an end that was not part of [his] intention.”

A second premise of Adam Smith was the acceptance of private property. Property was not to be held in common but owned and freely traded in a market system. Profits generated from the use and exchange of private property rights provided incentive and became the mechanism that drives the capitalist system.

From a Christian perspective we can see that the basis of private property rests in our being created in God’s image. We can make choices over property that we can exchange in a market system. The need for private property grows out of our sinfulness. Our sinful nature produces laziness, neglect, and slothfulness. Economic justice can best be achieved if each person is accountable for his own productivity.

A third premise of Adam Smith’s theory was the minimization of the role of government. Borrowing a phrase from the French physiocrats, he called this laissez-faire. Smith argued that we should decrease the role of government and increase the role of a free market.

Historically, capitalism has had a number of advantages. It has liberated economic potential. It has also provided the foundation for a great deal of political and economic freedom. When government is not controlling markets, then there is economic freedom to be involved in a whole array of entrepreneurial activities.

Capitalism has also led to a great deal of political freedom, because once you limit the role of government in economics, you limit the scope of government in other areas. It is no accident that most of the countries with the greatest political freedom usually have a great deal of economic freedom.

At the outset, let me say that Christians cannot and should not endorse every aspect of capitalism. For example, many proponents of capitalism hold a view known as utilitarianism, which is opposed to the notion of biblical absolutes. Certainly we must reject this philosophy. But here I would like to provide an economic critique.

Capitalism: Economic Criticisms

The first economic criticism is that capitalism leads to monopolies. These develop for two reasons: too little government and too much government. Monopolies have occurred in the past because government has not been willing to exercise its God-given authority. Government finally stepped in and broke up the big trusts that were not allowing the free enterprise system to function correctly.

But in recent decades, the reason for monopolies has often been too much government. Many of the largest monopolies today are government sanctioned or sponsored monopolies that prevent true competition from taking place. The solution is for government to allow a freer market where competition can take place.

Let me add that many people often call markets with limited competition “monopolies” when the term is not appropriate. For example, the three major U.S. car companies may seem like a monopoly or oligopoly until you realize that in the market of consumer durables the true market is the entire western world.

The second criticism of capitalism is that it leads to pollution. In a capitalistic system, pollutants are considered externalities. The producer will incur costs that are external to the firm, so often there is no incentive to clean up the pollution. Instead, it is dumped into areas held in common such as the air or water.

The solution in this case is governmental intervention. But I don’t believe that this should be a justification for building a massive bureaucracy. We need to find creative ways to direct self-interest so that people work towards the common good.

For example, most communities use the water supply from a river and dump treated waste back into the water to flow downstream. Often there is a tendency to cut corners and leave the waste treatment problem for those downstream. But if you required that the water intake pipe be downstream and the waste pipe be upstream you could insure less pollution problems. It is now in the self-interest of the community to clean the wastewater being pumped back into the river. So while there is a need for governmental action, much less might be needed if we think of creative ways to constrain self-interest and make it work for the common good.

We can acknowledge that although there are some valid economic criticisms of capitalism, these can be controlled by limited governmental control. And when capitalism is wisely controlled, it generates significant economic prosperity and economic freedom for its citizens.

Capitalism: Moral Criticisms

One of the first moral arguments against capitalism involves the issue of greed. And this is why many Christians feel ambivalent towards the free enterprise system. After all, some critics of capitalism contend that this economic system makes people greedy.

To answer this question we need to resolve the following question. Does capitalism make people greedy or do we already have greedy people who use the economic freedom of the capitalistic system to achieve their ends? In light of the biblical description of human nature, the latter seems more likely.

Because people are sinful and selfish, some are going to use the capitalist system to feed their greed. But that is not so much a criticism of capitalism as it is a realization of the human condition. The goal of capitalism is not to change people but to protect us from human sinfulness.

Capitalism is a system in which bad people can do the least harm, and good people have the freedom to do good works. Capitalism works well if you have completely moral individuals. But it also functions adequately when you have selfish and greedy people.

Important to this discussion is the realization that there is a difference between self-interest and selfishness. All people have self-interest, and that can operate in ways that are not selfish. For example, it is in my self-interest to get a job and earn an income so that I can support my family. I can do that in ways that are not selfish.

Adam Smith recognized that every one of us has self-interest, and, rather than trying to change that, he made self-interest the motor of the capitalist system. And before you react to that, consider the fact that even the gospel appeals to our self-interest. It is in our self-interest to accept Jesus Christ as our Savior so that our eternal destiny will be assured.

By contrast, other economic systems like socialism ignore the biblical definitions of human nature. Thus, they allow economic power to be centralized and concentrate power in the hands of a few greedy people. Those who complain of the influence major corporations have on our lives should consider the socialist alternative of how a few governmental bureaucrats control every aspect of their lives.

Greed certainly occurs in the capitalist system. But it does not surface just in this economic system. It is part of our sinfulness. The solution is not to change the economic system, but to change human nature with the gospel of Jesus Christ.

In conclusion, we may readily acknowledge that capitalism has its flaws as an economic system, but it can be controlled to give us a great deal of economic prosperity and economic freedom.

Note

1. See also my article “Ethics and Economics” on Probe’s Web site at www.probe.org/content/view/1340/88/

© 2008 Probe Ministries

 


 

About the Author

Kerby Anderson This e-mail address is being protected from spam bots, you need JavaScript enabled to view it is National Director of Probe Ministries International. He holds masters degrees from Yale University (science) and from Georgetown University (government). He is the author of several books, including Christian Ethics in Plain Language, Genetic Engineering, Origin Science, and Signs of Warning, Signs of Hope. His new series with Harvest House Publishers includes: A Biblical Point of View on Islam and A Biblical Point of View on Homosexuality. He is the host of “Point of View” (USA Radio Network) and regular guest on “Prime Time America” (Moody Broadcasting Network) and “Fire Away” (American Family Radio). He produces a daily syndicated radio commentary and writes editorials that have appeared in papers such as the Dallas Morning News, the Miami Herald, the San Jose Mercury, and the Houston Post.

 
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Posted by on June 30, 2008 in Uncategorized

 

Democrats and Racial Politics

By Frances Rice

 

Democrats have a 150-year history of using race as a political weapon to keep blacks in virtual slavery and Republicans out of power.

 

The recent firestorm ignited by Senator Hillary Clinton’s racially-tinged attempt to derail Senator Barack Obama’s presidential campaign shows the perils of Democrats using their race-based weapon against a black Democrat.  In the black community, people are outraged about how Democrat demagogues, including Billionaire Bob Johnson of BET, are treating Obama as an “uppity Negro” who dares to defy their white Democratic Party masters.

 

Prior to the Clinton-Obama hullabaloo over Senator Clinton’s disparaging remark about Dr. Martin Luther King, Jr., the Clinton campaign was being given a pass for using racial slurs against Senator Obama.  When Democrats called Senator Obama a “Magic Negro,” there was hardly a ripple of protest.  Just as little concern is expressed when Democrats slander black Republicans, such as former Lt. Governor Michael Steele who Democrats depicted as a “Simple Sambo” and Dr. Condoleezza Rice who was portrayed as an ignorant “Mammy”, reminiscent of the racial stereotypes used by Democrats during the days of “Jim Crow.” Any Republican using such slanderous tactics against blacks would be castigated as a racist and destroyed politically.

 

If the controversy generated by Senator Clinton’s remark that diminished the civil rights role of Dr. Martin Luther King, Jr. signals the beginning of an end to the type of racial divisiveness inflicted on our nation for over a century and a half by Democrats, then the angst created by Senator Clinton will be well worth it.

 

To fully appreciate the significance of this possible historical turning point, we must pause to examine briefly the Democratic Party’s sordid racist history.

 

The History of Civil Rights

 

As author Michael Scheurer so succinctly stated, the Democratic Party is the party of the four S’s:  Slavery, Secession, Segregation and now Socialism.  Because the Republican Party was started in 1854 as the anti-slavery party, and Republicans fought for freedom and equality for blacks, the early civil rights leaders, including Frederick Douglass, Harriet Tubman and Sojourner Truth, were Republicans.

 

The civil rights era of the 1960′s was necessary because, after the Civil War, the Democrats thwarted the efforts of Republicans to grant blacks civil rights and launched a reign of terror against Republicans, black and White— using the Ku Klux Klan, the terrorist arm of the Democratic Party—to deny blacks their civil rights and stop blacks from voting for Republicans.

 

Democrats used the Ku Klux Klan and other White supremacist groups to target Republicans because it was Republicans who amended the Constitution to grant blacks freedom (13th Amendment), citizenship (14th Amendment) and the right to vote (15th Amendment).  Republicans also passed the civil rights laws of the 1860′s, including the Civil Rights Act of 1866 and the Reconstruction Act of 1867 that was designed to establish a new government system in the Democrat-controlled South, one that was fair to blacks.

 

Shamefully, Democrats fought against anti-lynching laws, and when the Democrats regained control of Congress in 1892, they passed the Repeal Act of 1894 that overturned civil right laws enacted by Republicans. Republicans started the NAACP to counter the racist practices of the Democrats, and it took Republicans five decades to finally enact civil rights laws in the 1950′s and 1960′s over the objection of Democrats.

 

The Modern Civil Rights Era

During the civil rights era of the1960′s, it was the Democrats who Dr. Martin Luther King, Jr. and the protestors were fighting.  Democrat Public Safety Commissioner Eugene “Bull” Connor in Birmingham let loose vicious dogs and turned skin-burning fire hoses on black civil rights demonstrators.  Democrat Georgia Governor Lester Maddox famously brandished ax handles to prevent blacks from patronizing his restaurant.  Democrat Alabama Governor George Wallace stood in front of the Alabama schoolhouse in 1963 and thundered, “Segregation now, segregation tomorrow, segregation forever.”  In 1954, Democrat Arkansas Governor Orville Faubus tried to prevent desegregation of a Little Rock public school.

Contrary to common belief, it was Republicans, not Democrats, who were pushing to pass the civil rights laws.  It was Republican President Dwight Eisenhower who established the U.S. Civil Rights Commission, enforced the desegregation of the military, sent troops to Arkansas to desegregate the schools, and appointed Chief Justice Earl Warren to the U.S. Supreme Court which resulted in the 1954 Brown vs. Board of Education decision ending school segregation.  Eisenhower also supported the civil rights laws of 1957 and 1960.

President John F. Kennedy was not a Civil Rights Advocate

Democrat President John F. Kennedy is lauded as a civil rights advocate.  In reality, Kennedy voted against the 1957 Civil rights Act while he was a senator, as did Democrat Senator Al Gore, Sr.  After he became president, John F. Kennedy opposed the 1963 March on Washington by Dr. King that was organized by A. Phillip Randolph who was a black Republican.  President Kennedy, through his brother Attorney General Robert Kennedy, had Dr. King wiretapped and investigated by the FBI on suspicion of being a Communist in order to undermine Dr. King.

In March of 1968, while referring to Dr. King’s leaving Memphis, Tennessee after riots broke out where a teenager was killed, Democrat Senator Robert Byrd, a former member of the Ku Klux Klan, called Dr. King a “trouble-maker” who starts trouble, but runs like a coward after trouble is ignited.  A few weeks later, Dr. King returned to Memphis and was assassinated on April 4, 1968.

Senator Everett Dirksen – The Forgotten Civil Rights Hero

Unknown by many today is the fact that it was Republican Senator Everett Dirksen from Illinois, not Democrat President Lyndon Johnson, who pushed through the civil rights laws of the 1960′s.  In fact, Dirksen was key to the passage of civil rights legislation in 1957, 1960, 1964, 1965 and 1968.  Dirksen wrote the language for the 1965 Voting Rights Act.  Dirksen also crafted the language for the Civil Rights Act of 1968 which prohibited discrimination in housing.

Because of his long record of championing civil rights legislation, Dr. Martin Luther King, Jr. hailed Senator Dirksen for his “able and courageous leadership.”  The “Chicago Defender,” the largest black-owned daily at that time, praised Senator Dirksen “for the grand manner of his generalship behind the passage of the best civil rights measures that have ever been enacted into law since Reconstruction,”

Today little is known about the struggle to pass the landmark 1964 Civil Rights Act.  The law guaranteed equal access to public facilities and banned racial discrimination by any entity receiving federal government financing.  The law was an update of Republican Charles Sumner’s 1875 Civil Rights Act which had been stuck down by the Democrat-controlled US Supreme Court in 1883.

The chief opponents of the 1964 Civil Rights Act were Democrat Senators Sam Ervin, Albert Gore, Sr. and Robert Byrd.  Senator Byrd, a former member of the Ku Klux Klan, filibustered against the bill for 14 straight hours before the final vote.  Former presidential candidate Richard Nixon lobbied hard for the passage of the bill.  When the bill finally came up for a vote, the House of Representatives passed the bill by 289 to 124.  Of Republicans in the House of Representatives 80% voted yes, and only 63% of Democrats voted yes.  The Senate vote was 73 to 27, with 21 Democrats in the Senate voting no, and only 6 Republicans voting no.

Equally important was the 1965 Voting Rights Act that authorized the federal government to abolish literacy tests and other means used to prevent blacks from exercising their constitutional right to vote that was granted by the 15th Amendment to the Constitution. With images of violence against civil rights protestors led by Dr. Martin Luther King, Jr. shaping the national debate, Democrats in Congress decided not to filibuster the Voting Rights Act of 1965.  When the bill finally came up for a vote, both houses of Congress passed the bill.  In the House of Representatives, 85% of Republicans and 80% of Democrats voted for the bill.  In the Senate, 17 Democrats voted no, and only one Republican voted no.

Notably, in his 4,500-word State of the Union Address delivered on January 4, 1965, Johnson mentioned scores of topics for federal action, but only thirty five words were devoted to civil rights.  He did not mention one word about voting rights. Information about Johnson’s anemic civil rights policy positions can be found in the “Public Papers of the President, Lyndon B. Johnson,” 1965, vol. 1, p.1-9.

The statement by President Johnson about losing the South after passage of the 1964 civil rights law was not made out of a concern that racist Democrats would suddenly join the Republican Party that was fighting for the civil rights of blacks.  Instead, it was an expression of fear that the racist Democrats would again form a third party, such as the short-lived States Rights Democratic Party.  In fact, Alabama’s Democrat Governor George C. Wallace in 1968 started the American Independent Party that attracted other racist candidates, including Democrat Atlanta Mayor (later Governor of Georgia) Lester Maddox.

Goldwater was a Libertarian, not a Racist

A review of Senator Barry Goldwater’s record shows that he was a Libertarian, not a racist.  Goldwater was a member of the Arizona NAACP and was involved in desegregating the Arizona National Guard.  He supported the Civil Rights Act of 1957 and the Civil Rights Act of 1960, as well as the constitutional amendment banning the poll tax.  His opposition to the more comprehensive Civil Rights Act of 1964 was based on his libertarian views about government.  Goldwater believed that the 1964 Act, as written, unconstitutionally extended the federal government’s commerce power to private citizens, furthering the government’s efforts to “legislate morality” and restrict the rights of employers.

It is instructive to read the entire text of Goldwater’s 1964 speech at the 28th Republican National Convention, accepting the nomination for president that is available from the Arizona Historical Foundation.  By the end of his career, Goldwater was one of the most respected members of either party and was considered a stabilizing influence in the Senate.

Senator Goldwater’s speech may be found also on the Internet at:

http://www.washingtonpost.com/wp-srv/politics/daily/may98/goldwaterspeech.htm

The Racists Democrats did not all Join the Republican Party

Contrary to the false assertions by Democrats today, the racist “Dixiecrats” did not all migrate to the Republican Party.  With the party slogan: “Segregation Forever!,” the Dixiecrats, who were Democrats, (a) formed the States’ Rights Democratic Party for the presidential election of 1948, (b) remained Democrats for all local elections and all subsequent national elections, and (c) declared that they would rather vote for a “yellow dog” than a Republican because the Republican Party was known as the party for blacks.

Today, some of those “Dixiecrats” continue their political careers as Democrats, including former Democrat Senator Ernest Hollings who put up the Confederate flag over the state capitol when he was the governor of South Carolina.

Another former “Dixiecrat” is Democrat Senator Robert Byrd who is well known for having been a “Keagle” in the Ku Klux Klan. There was no public outcry when Democrat Senator Christopher Dodd praised Senator Byrd as someone who would have been “a great senator for any moment,” including the Civil War.  Democrats denounced Senator Trent Lott for his remarks about Senator Strom Thurmond.  However, Senator Thurmond was never in the Ku Klux Klan and, after he became a Republican, defended blacks against lynching and the discriminatory poll taxes imposed on blacks by Democrats. If Senator Byrd and Senator Thurmond were alive during the Civil War, and Byrd had his way, Thurmond would have been lynched.

Nixon’s “Southern Strategy” was not a Racist Appeal

Democrats expressed no concern when the racially segregated South voted solidly for Democrats; yet unfairly deride Republicans because of the thirty-year odyssey of the South switching to the Republican Party that began in the 1970′s with President Richard Nixon’s “Southern Strategy.”  Nixon’s strategy was an effort on the part of Nixon to get fair-minded people in the South to stop voting for Democrats who did not share their values and were discriminating against blacks.  Georgia did not switch until 2004, and some Southern states, including Louisiana, was still controlled by Democrats until the election of Republican Bobby Jindal in 2007.

Frances Rice is a lawyer, retired Army Lieutenant Colonel and Chairman of the National Black Republican Association.  She may be contacted at: www.NBRA.info

 

District of Columbia v. Heller

National Center for Public Policy Research Press Releases

For Release: June 26, 2008
Contact: David Almasi at (202) 543-4110 or dalmasi@nationalcenter.org


District of Columbia v. Heller Supreme Court Second Amendment Decision Hailed by Black Activists

Washington, D.C. – Today’s U.S. Supreme Court ruling overturning the ban on most gun ownership in the nation’s capital in the first major Second Amendment case in almost 70 years is being hailed by black activists of the Project 21 leadership network.

Project 21 Fellow Deneen Borelli says the decision supporting an individual right to use firearms is a loud and clear declaration that the government cannot pick and choose what constitutional protections are honored and enforced.

“This is a great day for law-abiding citizens of the nation’s capital who have unjustly been denied their full right to protect themselves and families for over 30 years,” said Borelli. “The Second Amendment guarantees the individual right of citizens to arm themselves for self-defense and not become easy prey. Perhaps the government should find a better way to keep illegal guns away from criminals and not law-abiding citizens.”

The case of District of Columbia v. Heller is an appeal of the decision of the U.S. Court of Appeals for the DC Circuit in Parker v. District of Columbia. In Parker v. District of Columbia, the DC Circuit ruled the District of Columbia’s Firearms Control Regulations Act of 1975, which bars handgun ownership by most D.C. residents, is unconstitutional.

The specific question being answered in District of Columbia v. Heller today was, as phrased by the Court: “Whether… provisions [in the District of Columbia code] violate the Second Amendment rights of individuals who are not affiliated with any state-regulated militia, but who wish to keep handguns and other firearms for private use in their homes.”

The District of Columbia, defending the constitutionality of the firearm ban before the Court in oral arguments March 18, argued the Second Amendment’s right to “bear arms” refers not to an individual right to use firearms, but rather to a “right to participate in the common defense” and a restriction of “the authority of the federal government to interfere with the arming” of state militias. The District of Columbia argued to the Court that “the Second Amendment… is expressly about the security of the State; it’s about well-regulated militias, not unregulated individual license.”

Opponents of the ban, however, said the Founders considered self-defense a right and one they intended the Second Amendment to protect, telling the Court “the framers knew exactly how to condition a right on militia service… and they didn’t do it with respect to the Second Amendment.”

“There are countless instances in which individuals are on their own when it comes to protecting themselves and their property. A majority of the Justices recognized this and upheld the Second Amendment’s specific protection of an individual right to self-defense. Now that D.C.’s citizens have had this constitutional right restored, criminals will have good reason to think twice before trying to plunder another’s property,” added Project 21′s Borelli.

In 2007, in a newspaper column published in Philadelphia, Chicago, Pittsburgh and elsewhere, Borelli addressed some of the public policy aspects of the case:

Besides violating the Second Amendment, D.C.’s gun ban is a violation of the fundamental rationale of law. In The Law, noted political theorist Frederic Bastiat wrote: ‘It is evident, then, that the proper purpose of law is to use the power of its collective force to stop this fatal tendency to plunder instead of to work. All the measures of the law should protect property and punish plunder.’ D.C. promotes the opposite, effectively protecting the plunderer and punishing the property owner.

Borelli also pointed out:

Research shows that law-abiding citizens using firearms for protection can save lives and deter crimes. In ‘Armed: New Perspectives on Gun Control,’ co-authors Gary Kleck and Don Kates note that ‘as many as 2.5 million victims use guns to defend against crime each year’ and ‘handguns are actually used by victims to repel crime far more often than they are by criminals in committing crimes – as much as three times more.’

Borelli believes that in addition to it being unconstitutional, it is immoral to deny law-abiding citizens the right to legally possess a firearm, especially within crime-infested neighborhoods.

Borelli’s column is available at www.nationalcenter.org/P21NVBorelliGuns90507.html.

Project 21, a nonprofit and nonpartisan organization sponsored by the National Center for Public Policy Research, has been a leading voice in the African-American community since 1992. For more information about Project 21 or the views of its members, contact David Almasi at (202) 543-4110 x11 or project21@nationalcenter.org, or visit Project 21′s website at www.nationalcenter.org/P21Index.html.

 
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Posted by on June 26, 2008 in Uncategorized

 

OLD KEYNESIAN DOGS, OLD FISCAL TRICKS


By Dr. Gary North • http://www.GaryNorth.com

As a dog returneth to his vomit, so a fool returneth to his folly (Proverbs 26:11).

We are about to be thrown back into the tender mercies of Keynesian economists. In the current setting, this will push the economy lower rather than higher.

The main Keynesian solutions to a faltering economy are federal budget deficits and monetary inflation. This two-part program assumes unemployment at 25% and annual deflation at 10%: the Great Depression in America.

Problem: it’s not 1936 any more.

Two recent articles reminded me that the intelligentsia of the United States is like the Louis XVIII, the king of France in the post-Napoleonic restoration: he had forgotten nothing and had learned nothing.

What the intelligentsia learned from the popularizers of Keynesian economics after 1936 they have not forgotten. They have learned nothing new.

KEYNESIAN ECONOMICS

The heart of John Maynard Keynes’ analysis in 1936 was the idea of a permanent free market equilibrium with high unemployment. For some reason, which he never explained coherently, sellers refuse to lower their prices when faced with buyers who refuse to buy at yesterday’s pre-Depression prices. This is especially true of workers who refuse to cut their wage demands.

Keynesianism is based on two fundamental ideas: (1) sellers do not learn that something is better than nothing, and therefore will not lower their selling prices; (2) economists do not learn that government spending that is financed by debt is accomplished in one of only ways: (a) money lent by savers, which could have been lent to businesses or consumers; (b) money lent by a central bank, which lowers the purchasing power of the currency unit. This is a philosophy of something for nothing.

We are told by economists that there are no free lunches. But, except for Austrian economists, all economists really do believe in something for nothing. They debate with each other about which “something” can be obtained for nothing — “nothing” always being a piece of legislation.

Non-Austrian economists believe that a gun, when held by a salaried government official and pointed at a citizen to extract his wealth can sometimes produce economic growth, whereas a gun held by an thief and pointed at a citizen to extract his wealth always produces economic loss. The first produces something for nothing, whereas the second produces nothing for something. What is the difference? This: the person holding the gun.

KEYNES AND THE NEW DEAL

Early in Franklin Roosevelt’s first term, Keynes met with Roosevelt. We know the date: May 28, 1934. Roosevelt’s Secretary of Labor, Frances Perkins, noted in her published recollections that Keynes came out of the meeting and commented on the President’s lack of economic literacy. Later, when speaking with Roosevelt, she noted that he said he thought Keynes must be a mathematician, rather than a political economist.

Both men had the other pegged exactly. Roosevelt knew no economics, and Keynes had earned a bachelor’s degree in math. He had no degree in economics. He got his job at Cambridge University in 1909 because his father, a Cambridge economist, put up half the money to hire his son.

Because the meeting was in 1934, and because Keynes had not yet come up with Keynesianism — he was still working on it — I do not think the meeting was important for the future of the American economy. Keynes justified in theory in 1936 what every Western government had been doing for several years: printing money, raising taxes, running deficits, and regulating the economy.

The New Deal did not end the Great Depression in the United States. World War II did. The war allowed governments to increase deficit spending, inflate tremendously, impose price controls, draft young men and put them to work killing each other (which reduced the labor pool), and hire women to work in munitions factories at below-market wages, using patriotism to persuade them to enter the labor force. Patriotism was used as a way to persuade men and women to work at what would have been below-market wages in 1938. Then inflation and rationing reduced real wages even more.

Economics teaches this: “When the price falls, more is demanded.” This is true of the price of labor. Keynes knew this in 1936, and wrote specifically that the reduced real wage rates produced by monetary inflation would fool workers into going back to work. But it took worldwide deception — wartime wages — to achieve this on a scale sufficient to end unemployment.

None of this is taught in any textbook — not in economics, not in history. To teach it would alert students to the economics of war, which centralizes the power of the State. This is the thesis of economist Robert Higgs in “Crisis and Leviathan.” This book’s thesis and data never get into college textbooks.

With this as background, let me summarize the first of two documents.

TIME MARCHES ON!

In the May 15 issue of “Time Magazine,” there is an article by Justin Fox. I had never heard of Mr. Fox. His biography on “Time”‘s site says he has a B.A. in international relations. He therefore writes for the business section. He has recently published a book, “The Myth of the Rational Market.” You get the general idea.

“Time” was started in 1923 by Henry Luce (Skull & Bones, Council on Foreign Relations). It has long been a popular outlet for the American Establishment. In fact, “Time” is the news magazine written by the American Establishment in order to shape the thinking of the voters on the Big Picture.

Mr. Fox’s enemy is what he perceives as Reaganism.

Economic eras don’t last forever, though, and there are signs that the current slowdown is a harbinger of something bigger: an end to America’s 25-year love affair with tax cuts and deregulation. A lot of the cracks that have emerged during that time, because of global economic shifts or our own neglect, have become impossible to ignore — stagnant incomes, a federal budget gone way out of balance, soaring energy prices, a once-in-a-lifetime housing crash and growing financial risks in retirement and from health care.

He says there has been growing inequality of wealth. He offers no statistics to indicate that inequality has increased from the income distribution of 1940, let alone 1900. Those who identify inequality as a significant economic or moral liability that calls for radical policy changes by government never do offer such statistics. There is a reason for this. The ratio of wealth by income class has barely changed, in the United States or in Western Europe, in a hundred years.

The evidence for a significant increase in American inequality since 1980 is based on tax evidence. But this evidence does not consider money in tax-deferred retirement funds. So, it is questionable.

http://GaryNorth.com/snip/580.htm

In any case, the critics offer no evidence that their reforms will eliminate inequality. It does no good to provide a cure until a problem is diagnosed. Why is income more unequal today — if it is — than it was in 1980? Second, was 1980 significantly different from 1940 or 1900? Where is the evidence? Next, where is the explanation? Only after we have both should we — meaning policy-makers — begin suggesting solutions.

So what should be done about income disparity? In an April Gallup poll, 68% of respondents said wealth “should be more evenly distributed” in the U.S. — the highest percentage saying so since Gallup started asking the question in 1984. A smaller majority, 51%, agreed that “heavy taxes on the rich” were needed.

Surprise! Surprise! Voters with less wealth want to the government to stick a gun in the belly of anyone with more wealth, telling him to fork it over. Of course, voters do not want the government to send people with guns to stick in their bellies, on behalf of people even poorer, who are far more numerous.

The politics of envy is the politics of this commandment: “Thou shalt not steal, except by majority vote.” It is the politics of two wolves and a sheep voting on what to have for dinner. It is alive and well all over the world.

The author then launches an unsubstantiated attack on Reagan’s cuts of the top brackets: from 70% to 28%. No
ention is made of Kennedy’s cuts from 91% to 70%. The economy boomed in both cases.

Then there is the energy crisis. What is needed? Not more production. We need more taxes and more subsidies by federal government.

What makes doing the right thing on energy difficult is that it would almost inevitably involve raising costs now, with higher taxes on oil, increased subsidies for other energy sources or higher energy-efficiency standards for vehicles and homes — or all three. Economists tend to prefer the first of these approaches because taxes on gas, oil or fossil fuels in general tamp demand and allow the market — rather than members of Congress — to sift out the best alternatives.

Here is the good news, he says: the candidates’ stand on global warming.

Interesting, though, to fight global warming, Clinton, McCain and Obama are all in favor of a carbon-cap-and-trade regimen, which would raise the price of fossil fuels just as surely as a direct tax would. Almost in spite of ourselves, we may end up with a semi-rational long-term energy policy. It won’t make gas cheaper anytime soon — or perhaps ever — but in the long run, it could strengthen the country’s economic prospects.

Next, how should government solve the housing crisis? Simple: repeal the tax deduction for mortgage interest payments. That will do it! Yes, sir, there is nothing like a huge tax on everyone’s after-tax income to stimulate robust growth in the housing market. (Too bad it won’t happen — voters being used to the deduction.)

Several countries have dropped the mortgage- interest deduction in recent years, with no noticeably adverse effects, but there’s no indication that any of our presidential candidates are contemplating such a move.

Then there is universal health care. No problem here, either!

But there’s real hope on this front. It is possible to conceive of a system that brings the 47 million uninsured into the fold, improves medical outcomes and costs less than what we’ve got now. It’s possible to conceive of because many other wealthy countries already have such systems. Figuring out exactly how to make universal health care work in the U.S. is a matter better left to its own lengthy magazine article. But if you’re looking for big economic change from the next Administration, this is the form it’s most likely to take.

http://www.garynorth.com/snip/588.htm

This article appeared in the premier Establishment outlet for the American intelligentsia.

My conclusion: get ready for a big dose of the politics of envy.

KUCINICH’S ECONOMIST SPEAKS OUT

There are not many American politicians further to the Left economically than Dennis Kucinich. In a recent interview, his economic advisor, Michael Hudson, provided a detailed and accurate assessment of the problems facing the Federal Reserve System. Then he offered solutions.You will not like the solutions.

The interviewer knew what questions to ask. The questions centered around the solvency of America’s largest banks. The FED is letting them swap bad debt for Treasury debt. Half of the FED’s reserves have been swapped for this supposedly AAA-rated paper since last December. This cannot go on much longer.

Problem: this program merely buys time. How will the banks unload this bad paper on suckers? The supply of suckers has dried up.

The Fed’s idea was merely to buy enough time for the banks to sell their junk mortgages to the proverbial “greater fool.” But foreign investors no longer are playing this role, nor are domestic U.S. pension funds. So the most likely result will be for the Fed simply to roll over its loans — as if the problem can be cured by yet more time.

The problem is bad real estate loans. There is nothing the Treasury can do to solve this problem. The game is over.

The financial sector has been living in the short run for quite a while now, and I suspect that a lot of money managers are planning to get out or be fired now that the game is over. And it really is over. The Treasury’s attempt to reflate the real estate market has not worked, and it can’t work. Mortgage arrears, defaults and foreclosures
are rising, and much property has become unsaleable except at distress prices that leave homeowners with negative equity.

Hence, the title of the article: “The Game Is Over. There Won’t Be a Rebound.”

The dollar is likely to fall. The problem begins with
the international trade system.
When Europe and Asia receive excess dollars, these are turned over to their central banks, which have little alternative but to recycle these back to the United States by buying U.S. Treasury bonds. Foreign governments — and their taxpayers — are thus financing the domestic U.S. federal budget deficit, which itself stems largely from the war in Iraq that most foreign voters oppose.

This is exactly the problem. The United States has pressured oil-exporting nations in the Middle East to demand payment in dollars and then cycle these dollars back through American multinational banks.

For over 30 years they have been pressured to recycle their oil earnings into the U.S. stock market and loans to U.S. financial institutions. They have taken large losses on these investments (such as last year’s money to bail out Citibank), and are trying to recoup them via the oil market.

Conclusion: “. . . unless they are willing to make a structural break and change the world monetary system radically, they will remain powerless to avoid giving the United States a free ride — including a free ride for its military spending and war in the Near East.”

But the fact is, a refusal by central banks to buy T-bills is exactly such a structural break in the world monetary system. He thinks this is now happening. So do I. So, I see no way to remain optimistic about the future value of the dollar.

Regional banks will go under, he says. The FED and the government will oversee mergers.

False reporting also will help financial institutions avoid the appearance of insolvency. They will seek more and more government guarantees, ostensibly to help middle-class depositors but actually favoring the big speculators who are their major clients.

I add: this is already taking place. That is what the FED’s swaps of Treasury debt for private mortgage-backed assets is all about.

Then what should Obama do? Tax and spend.As president, he will have to do what FDR did, and challenge the financial oligarchy with new government regulatory agencies staffed with real regulators, not deregulators as under the Bush-Clinton-Bush regime. . . . Most of all, he will have to make the tax system back progressive again if the domestic market is to recover. He should remove the tax-deductibility of interest payments, and do what the original 1913 income tax did: tax capital gains at normal income rates rather than subsidizing speculation. . . .Wait a minute! This is what Mr. Fox recommends in his article in “Time.”What about Social Security and Medicare? Simple: exempt family that makes under $60,000 a year and tax all income for everyone else — no cut-off at $105,000.There is no deduction from gross income for donations under Social Security. This is just what the centralizers need! This will be Europe’s tax system.He says this will take power away from the American oligarchy. “Unless he does this, what used to be a democracy will be turned into an oligarchy.”

Yet “Time” ran a cover story on just this sort of tax reform. And time has been the popular news magazine for the oligarchy since its creation in 1923.

CONCLUSION

We are heading into a great reversal. We are going to see rising taxes and a falling stock market. Housing is unlikely to rebound next year.

The economic goal today is to keep what you have in the face of a revived welfare state. The days of wine and roses are going to be rolled back next year and beyond.


Gary North’s Economic Edge™

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The Consequences of Ignorance

By Rev. Tommy Davis

Greater than any disease is the issue of ignorance. I often talk to well meaning folks who have so many opinions about the Bush Administration and the economy while the facts that would truly advise them are totally ignored.

One lady told me that Bush is raising the price of oil to profit from its earnings. Another time I was told that the Republicans think they own the whole country and just allow us to live in it. On the same note I have been told that Obama is a very smart guy and he should be president.

Most of these statements spew forth from black and white liberals who desire freedom and prosperity at the expense of the wealthy. Economically, it would not make much sense for Bush to support buying oil from the Middle East when he could yield greater returns from the American oil industry.

Second, the United States is not a member of the Organization of the Petroleum Exporting Countries (OPEC). OPEC is made up of thirteen countries who control two-thirds of the world’s oil reserves. Their output is over 35 percent of the market. It’s OPEC who controls crude oil prices, and its government taxation that finally determines the price after refinery on American soil.

If the U.S. Government raises taxes for oil companies then those costs must be transferred over to the consumer in order for businesses to make a profit, pay their employees and reinvest capital.

A Republican form of government that believes in low taxes and small administration understand that the public will benefit more from innovative ideas through free-market competition. It is high taxes and government price controls that leads to inflation and an unstable market. Remember, it was Franklin Roosevelt’s National Recovery Act (NRA) of 1933 that helped prolong the Great Depression. The NRA required above-market wages for fresh hires which led to elevated unemployment.

Obama is a repackaged Roosevelt’s New Deal (‘Change’). The federal government attempted to control costs and production through many policies and ‘agreements’ with trade associations.

A president who signs activist legislation that penalizes businesses for providing goods to consumers will only make it more difficult for those very consumers to either purchase their desired goods; or those goods would not be provided at all due to the high cost of production and low return on capital (when a company is forced into bankruptcy).

FDR’s New Deal that found support with a majority Democratic Congress was a fable but he sold it to a desperate people. In similar fashion, Obama’s “change” is another step in taking America down a comparable road until a new “Ronald Reagan” gives power back to the consumer and restores true competition in the business world. Thus, resulting in a superior change in our economy.

 

 

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Life: a gift from God

by Mathew Piercy

‘I will neither give a deadly drug to anybody if asked for it, nor will I make a suggestion to this effect. Similarly, I will not give a woman an abortive remedy.’ The Hippocratic Oath.1

These words, penned approximately four centuries before Christ, still hold immense relevance today. Their writer was Hippocrates, a philosopher and physician of Ancient Greece who is often considered to be ‘the father of medicine’. Hippocrates’ ‘Oath’ encapsulated the idea prevalent in Greek philosophy that suicide was a social evil akin to killing another human person, but for the first time placed it in a code of practice for doctors.

Medical students in many western countries are still required to take the above ‘Hippocratic oath’. The anti-abortion clause, however, at least in my country of Australia, has been conveniently (and tragically) removed, a reflection of the secularization of our evolutionized culture. Modern medicine has all but abandoned the principle of the sanctity of human life that Hippocrates enunciated, and which is also found in the Genesis account of man being made in God’s image. For example, today abortion is considered by many to be a ‘pregnancy choice’ rather than the destruction of another human being. Medical treatments are withdrawn from patients on the basis that they lack ‘quality of life’, rather than considering whether the treatment will help the person get better or preserve their life until the natural end.

The belief that we have evolved from simpler creatures is often used to justify the rejection of God as Creator and hence the rejection of His authority through His Law. Without God, life becomes purposeless. Disability, suffering and the terminal stages of life are viewed as meaningless. This is a contributing cause to the ‘culture of death’ that is affecting the Western world in areas such as medicine and healthcare, where people’s lives are dependent on others.

The increasing acceptance of euthanasia is part of this shift in mentality towards the ‘culture of death’. Not long ago, the world watched a court of the United States rule that a disabled person, Terri Schiavo, should die by starvation and dehydration. How could an innocent person be deliberately killed in this way? (Remember that it is not like turning off complex machinery—anyone would die if prevented from taking in water or food, so we are talking about an overt act of killing the innocent—murder, by definition.)

The truth is that people have lost their sense of what it means to be human. Life, instead of being a precious gift, becomes evaluated according to its ‘quality’. A person whilst young, active and productive has a high ‘quality of life’, yet once this person becomes old, disabled or dependent, the quality is reduced, and his or her life may no longer be considered to be worth living or protecting. Without the possibility of recovery, disability or dependence on others become grounds for the termination of that person’s life.

Echoes of this sentiment were also found in Clint Eastwood’s popular movie, Million Dollar Baby. The main character, a female boxer, starts out bold and successful, but ends up suffering a high level spinal cord injury leaving her permanently disabled, dependent on a ventilator (breathing machine) and unable to move her limbs. For her, the loss of her previous abilities is too much and she seeks death, and her ventilator is switched off in what is depicted by Hollywood as a profound act of compassion. (It is interesting to note that the Third Reich used similar films to promote acceptance of euthanasia prior to the extermination of the disabled and the mentally handicapped in Nazi Germany.2) Far from being compassionate, the carers have simply taken the easy way out. Rather than supporting her through her illness and allowing her to adjust to life’s circumstances (compare quadriplegic Christian author Joni Eareckson Tada), they assist in killing her. Such an act rejects the essential aspect that her life is not her own to take. Made in God’s image, she has no right to destroy her own life, or permit others to do so, whatever her situation.

The story of Job in the Bible recounts how he refused to ‘curse God and die’ (Job 2:9) despite this counsel being given to him by his wife. This was because Job feared God and understood that only He has the authority to give and to take life. Even if all joy is taken out of life, as was the case with Job, that still would not justify the taking of life. Even in the depths of suffering, God’s image remains, and life remains an intrinsic good, worthy of protection and support. Not to mention the fact that in rare instances, people have unexpectedly recovered from what were deemed as ‘hopeless’ medical situations.

When courts or individuals become the arbiters of life or death, such power in the hands of mankind (which has a poor track record on handling it wisely) is open to abuse, misjudgment, and bias.

The Christian church, and indeed society in general, should never accept the lie that euthanasia represents ‘a good death’ (as the word’s etymology3 implies). Euthanasia, in its real sense, represents a profound rejection of the gift of life, and hence of the Giver Himself. Instead, there should be a recognition that man, being made in the image of God, has intrinsic value and dignity from conception to natural death.

The decline of respect for life in western culture is one more symptom of the tragic foundational shift away from a biblical worldview to one based on evolutionary humanism.

References and notes

  1. As translated by Ludwig Edelstein. Return to text.
  2. Burleigh, M., Death and Deliverance, Cambridge University Press, New York, USA, p. 210, 1994. Return to text.
  3. From the Greek eu = good or easy, and thanatos = death. Return to text.
 
 
 
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