Showing posts with label Medicare. Show all posts
Showing posts with label Medicare. Show all posts

Sunday, December 6, 2015

Bernie Sanders: A Glaring Symptom Of American Dishonesty


... Thus, for example, health care was declared by Bill Clinton during the 1992 election campaign to be "a right, not a privilege" — a neat dichotomy which verbally eliminates the whole vast range of things for which we work, precisely because they are neither rights nor privileges.  For society as a whole, nothing is a right — not even bare subsistence, which has to be produced by human toil.  Particular segments of society can of course be insulated from the necessities impinging on society as a whole, by having someone else carry their share of the work, either temporarily or permanently.  But, however much those others recede into the background in the verbal picture painted by words like "rights," the whole process is one of differential privilege. ...
  — Thomas Sowell, 'The Vision Of The Anointed: Self-Congratulation as a Basis for Social Policy', 1995, p.100


A long standing dishonesty among the American public (and most of the world) is the false claim that human rights include a certain quality of life, or outcome — i.e. that an individual's rights place an obligation on others to provide for their needs.

This is so obviously contradictory, it is surprising what lengths so many will go to in their attempts to delude themselves that it is somehow true.

The contradiction is too obvious to be honestly ignored.   That is, if you have a right to other people's labor to satisfy your needs, why do they not have a right to your labor to satisfy theirs?   To put it another way, if you have a right to, say, 'free' medical care simply because you need it, as so many wish to pretend, why don't the individuals that provide that 'free' care (whether unpaid medical staff, or taxpayers) have the same right to make you their servant, simply because they need it?

There is no honest answer to explain the contradiction highlighted by such questions, despite the convoluted rationalizations that many will immediately spin to justify the individual rights violations entailed by any supposedly free government provided service — if government gives any service for free to some group of individuals, other individuals are being made slaves to them, regardless of how one describes the relationship.

Typically, people pretend that because one person is suffering and another is not (that one person's well being is higher than another's) that is enough to justify the initiation of force via the political process, to force one person to serve another.   But this clearly does not make it right — that is, human suffering or need does not somehow magically create a human right.

Certainly, the vast majority of people would not want their time and effort to be seen as something owed to others as a right, yet when that majority wants something from a minority among them, they ignore their hypocrisy and pretend their desire to engage in rent-seeking is moral (while simultaneously complaining when others attempt to get special treatment from government, of course).

Human rights can be reduced to one simple idea: if others do not leave you alone, it is moral for you to fight back — that is, to defend yourself by retaliating with force.

In other words, other than for purposes of restitution, it is contradictory to claim that any action can be morally required of you by others without your consent.   Individual rights create the restriction that one is morally obligated not to harm or harass others — not that one is morally obligated to serve others.   Obviously, again, there is no such thing as a right to be served by others (that would be slavery).   Therefore, any law that requires an action which is not part of a restitution is immoral — like creating a legal requirement for some group to provide or pay for some service for others without the unanimous consent of the group.   In short, it should be obvious that law cannot morally be used to initiate force, and so any law which does so must be immoral.

Notice that this simple idea includes rights violations from externalities, like pollution — measuring the harm is complicated (like if someone is running a loud smoking car in a driveway near you, or polluting the groundwater you use for drinking), but the principle of individuals being prohibited actions that harm others is not complicated.

It is important to emphasize that legally requiring actions by some individuals without their consent, to provide some service by right to others, completely destroys the principle of individual rights.   That is, such a use of force makes every individual's freedom of action, and so their fundamental right, conditional on the dictates of government — in no way can this be defined as freedom, or consistent with the recognition and protection of individual rights.   You are not free, and so have no rights, if government can claim your time and effort for others by right.

The ultimate end result of such a principle is the numerous bloody dictatorships that have always existed, epitomized by North Korea.   In principle there is no difference between such brutal regimes and other socialist states, regardless of the obvious differences in practice.   That is, such bloody dictatorships have simply taken the principle that individuals owe service to others as a right to its logical conclusion.   Once such a principle is accepted, every individual's life belongs to the state — with any supposedly justifying need, the state is then obligated to dispose of the time and effort of its citizen's lives to protect an individual's supposed 'right' to receive service (and if nothing else, people have certainly demonstrated the ease with which they can invent nonsensical rights to service).

On what grounds can one argue that North Korea is immoral, for example, when one accepts and defends the principle that the state can dispose of one's time and effort against one's will simply because of another's need?

North Korea simply applies that principle in all cases, and jails anyone who refuses to submit — after all, under the principle that the state can dispose of your time and effort based on the needs of others by right, the refusal to submit constitutes a violation of another individual's rights — that is, it is a legitimate crime under the principle.   There is no escaping this obvious conclusion.   If others can demand your time and effort by right, then it is criminal for you to refuse — just as it is criminal to steal another's property which belongs to them by right.   This is what it means to claim that something is a right.

So to those who say that one has a right to medical care, for example, what would you say to criticize North Korea? —
      "Oh, they've just gone too far." ? (!!)

Really?   Why?   Aren't they just being more consistent?

Perhaps you would say —
      "North Korea is immoral because they closed their border, and don't allow people to migrate." ?

But why does the government of North Korea not have a right to prevent people from leaving by closing their border, if those who wish to leave owe their services to others by right?   How could a country possibly enforce such a right without closing its borders?

In short, it is impossible for an honest person to criticize a brutal dictatorship like North Korea, after having accepted on principle that one can have a right to the time and efforts of others (via some service like medical care).   Everything North Korea has done follows directly from that principle to the extreme, and as contemptible and unjust as such a country is, the only way to attack such regimes is with a clear defense of man's right to be left alone — that is, with an attack on the irrational altruist ethic of self-sacrifice, and the false and nonsensical claim that there is a supposed right to the involuntary servitude of others.

It is fascinating that people seem to believe that such an enormous perverse debasement of individual rights will somehow never harm them.

And notice that there is nothing new in the claim that individuals have a right to the involuntary servitude of others — the Democratic party insisted that explicitly over 50 years ago in their party platform of 1960.

The Democratic Party Platform of 1960 clearly states the contradiction of a supposed right to service, claiming as a value and support for "our open society which places its highest value upon individual dignity", as opposed to the Communist world where "the rights of men are sacrificed to the state", while the same platform also supported an "Economic Bill of Rights" — i.e. a right to the forced labor or agreement of other individuals, directly contradicting the supposed recognition of the value of individual dignity by demanding the sacrifice of the rights of men to the state.

It is just our old friend the Orwellian double think again — my freedom requires your oppression --

http://archive.is/RRUpE

Democratic Party Platform of 1960
July 11, 1960
...

The Communist World

To the rulers of the Communist World: We confidently accept your challenge to competition in every field of human effort.

We recognize this contest as one between two radically different approaches to the meaning of life—our open society which places its highest value upon individual dignity, and your closed society in which the rights of men are sacrificed to the state.

We believe your Communist ideology to be sterile, unsound, and doomed to failure. We believe that your children will reject the intellectual prison in which you seek to confine them, and that ultimately they will choose the eternal principles of freedom.
...

Control of Inflation

The American consumer has a right to fair prices. We are determined to secure that right.

Inflation has its roots in a variety of causes; its cure lies in a variety of remedies. Among those remedies are monetary and credit policies properly applied, budget surpluses in times of full employment, and action to restrain "administered price" increases in industries where economic power rests in the hands of a few.

A fair share of the gains from increasing productivity in many industries should he passed on to the consumer through price reductions.

The agenda which a new Democratic Administration will face next January is crowded with urgent needs on which action has been delayed, deferred, or denied by the present Administration.

A new Democratic Administration will undertake to meet those needs.

It will reaffirm the Economic Bill of Rights which Franklin Roosevelt wrote into our national conscience sixteen years ago. It will reaffirm these rights for all Americans of whatever race, place of residence, or station in life:

1. "The right to a useful and remunerative job in the industries or shops or farms or mines of the nation."
...

Minimum Wages

2. "The right to earn enough to provide adequate food and clothing and recreation."
...

Agriculture

3. "The right of every farmer to raise and sell his products at a return which will give him and his family a decent living."
...

Small Business

4. "The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home and abroad."
...

Housing

5. "The right of every family to a decent home." Today our rate of home building is less than that of ten years ago. A healthy, expanding economy will enable us to build two million homes a year, in wholesome neighborhoods, for people of all incomes.
...

Health

6. "The right to adequate medical care and the opportunity to achieve and enjoy good health."
...

Mental Health

Mental patients fill more than half the hospital beds in the country today. We will provide greatly increased Federal support for psychiatric research and training, and community mental health programs, to help bring back thousands of our hospitalized mentally ill to full and useful lives in the community.

7. "The right to adequate protection from the economic fears of old age, sickness, accidents, and unemployment."
...

Education

8. "The right to a good education."
...


None of the supposed eight 'economic rights' listed above, from the Democratic Party Platform of 1960, can properly be considered a right (i.e. creating a crime, if they were not provided), since each one has nothing to do with freedom of action, and cannot be achieved without the forced participation of other individuals.   Each one claims a supposed right to a quality of life, or outcome, which does not exist in a state of nature, since it is a product of human effort and cooperation.

Here is an excellent definition of man's rights by Ayn Rand, from the chapter 'Man's Rights', from her book 'The Virtue of Selfishness'.   She wrote this essay back in 1963, and she included a description of the Democratic Party Platform of 1960, as an example of the destruction of the concept of individual rights --

https://ari.aynrand.org/issues/government-and-business/individual-rights/Mans-Rights
http://www.aynrand.org/novels/virtue-of-selfishness
...
A “right” is a moral principle defining and sanctioning a man’s freedom of action in a social context.   There is only one fundamental right (all the others are its consequences or corollaries): a man’s right to his own life.   Life is a process of self-sustaining and self-generated action; the right to life means the right to engage in self-sustaining and self-generated action—which means: the freedom to take all the actions required by the nature of a rational being for the support, the furtherance, the fulfillment and the enjoyment of his own life.   (Such is the meaning of the right to life, liberty and the pursuit of happiness.)

The concept of a “right” pertains only to action—specifically, to freedom of action.   It means freedom from physical compulsion, coercion or interference by other men.

Thus, for every individual, a right is the moral sanction of a positive — of his freedom to act on his own judgment, for his own goals, by his own voluntary, uncoerced choice.   As to his neighbors, his rights impose no obligations on them except of a negative kind: to abstain from violating his rights.

The right to life is the source of all rights—and the right to property is their only implementation.   Without property rights, no other rights are possible.   Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means to sustain his life.   The man who produces while others dispose of his product, is a slave.

Bear in mind that the right to property is a right to action, like all the others: it is not the right to an object, but to the action and the consequences of producing or earning that object.   It is not a guarantee that a man will earn any property, but only a guarantee that he will own it if he earns it.   It is the right to gain, to keep, to use and to dispose of material values.

The concept of individual rights is so new in human history that most men have not grasped it fully to this day. In accordance with the two theories of ethics, the mystical or the social, some men assert that rights are a gift of God—others, that rights are a gift of society.   But, in fact, the source of rights is man’s nature.

The Declaration of Independence stated that men “are endowed by their Creator with certain unalienable rights.” Whether one believes that man is the product of a Creator or of nature, the issue of man’s origin does not alter the fact that he is an entity of a specific kind—a rational being—that he cannot function successfully under coercion, and that rights are a necessary condition of his particular mode of survival.

“The source of man’s rights is not divine law or congressional law, but the law of identity.   A is A—and Man is Man.   Rights are conditions of existence required by man’s nature for his proper survival.   If man is to live on earth, it is right for him to use his mind, it is right to act on his own free judgment, it is right to work for his values and to keep the product of his work.   If life on earth is his purpose, he has a right to live as a rational being: nature forbids him the irrational.” (Atlas Shrugged.)

To violate man’s rights means to compel him to act against his own judgment, or to expropriate his values.   Basically, there is only one way to do it: by the use of physical force.   There are two potential violators of man’s rights: the criminals and the government.   The great achievement of the United States was to draw a distinction between these two—by forbidding to the second the legalized version of the activities of the first.
...

It was the concept of individual rights that had given birth to a free society. It was with the destruction of individual rights that the destruction of freedom had to begin.

A collectivist tyranny dare not enslave a country by an outright confiscation of its values, material or moral. It has to be done by a process of internal corruption.   Just as in the material realm the plundering of a country’s wealth is accomplished by inflating the currency—so today one may witness the process of inflation being applied to the realm of rights.   The process entails such a growth of newly promulgated “rights” that people do not notice the fact that the meaning of the concept is being reversed.   Just as bad money drives out good money, so these “printing-press rights” negate authentic rights.

Consider the curious fact that never has there been such a proliferation, all over the world, of two contradictory phenomena: of alleged new “rights” and of slave-labor camps.

The “gimmick” was the switch of the concept of rights from the political to the economic realm.

The Democratic Party platform of 1960 summarizes the switch boldly and explicitly.   It declares that a Democratic Administration “will reaffirm the economic bill of rights which Franklin Roosevelt wrote into our national conscience sixteen years ago.”

Bear clearly in mind the meaning of the concept of “rights” when you read the list which that platform offers:

  “1. The right to a useful and remunerative job in the industries or shops or farms or mines of the nation.
  “2. The right to earn enough to provide adequate food and clothing and recreation.
  “3. The right of every farmer to raise and sell his products at a return which will give him and his family a decent living.
  “4. The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition
        and domination by monopolies at home and abroad.
  “5. The right of every family to a decent home.
  “6. The right to adequate medical care and the opportunity to achieve and enjoy good health.
  “7. The right to adequate protection from the economic fears of old age, sickness, accidents and unemployment.
  “8. The right to a good education.”

A single question added to each of the above eight clauses would make the issue clear: At whose expense?

Jobs, food, clothing, recreation (!), homes, medical care, education, etc., do not grow in nature.   These are man-made values—goods and services produced by men.   Who is to provide them?

If some men are entitled by right to the products of the work of others, it means that those others are deprived of rights and condemned to slave labor.

Any alleged “right” of one man, which necessitates the violation of the rights of another, is not and cannot be a right.

No man can have a right to impose an unchosen obligation, an unrewarded duty or an involuntary servitude on another man.   There can be no such thing as “the right to enslave.”

A right does not include the material implementation of that right by other men; it includes only the freedom to earn that implementation by one’s own effort.

Observe, in this context, the intellectual precision of the Founding Fathers: they spoke of the right to the pursuit of happiness—not of the right to happiness.   It means that a man has the right to take the actions he deems necessary to achieve his happiness; it does not mean that others must make him happy.

The right to life means that a man has the right to support his life by his own work (on any economic level, as high as his ability will carry him); it does not mean that others must provide him with the necessities of life.
...



Here is Rand Paul attempting to explain to Bernie Sanders the problems with declaring that one has a right to medical care --



Sanders is incapable of responding, other than to try to avoid the issue by getting one of the doctors invited to speak to state that she does not 'feel like a slave'.   Well, of course not — doctors that participate in government provided health care are being paid by taxpayers from forced tax collections — obviously they are a beneficiary here (at least to the degree that government actually pays).   That some doctors do not 'feel like slaves' does nothing to refute Rand Paul's point, which is that to claim something is a right means that it can be morally taken by force, regardless of how many are willing to give it up voluntarily.

And notice the comment from Debra Draper, from the U.S. Government Accountability Office, regarding the difficulty that Medicaid beneficiaries have in finding a physician, since many physicians simply refuse to see them because of the low Medicaid reimbursement rate (and this is only expected to get worse) —
     https://www.google.com/search?q=doctors+refuse+medicaid+patients

So much for the government's ability to provide free medical care — doctors simply stop providing the care if they feel the compensation is too low, regardless of how many may claim they do not 'feel like a slave' or that they will treat patients without payment.

And note that this video was not put together by an opponent of Bernie Sanders — it is a video Sanders had created and placed on his own YouTube channel.

Bernie Sanders is proud of such behavior, and thinks that voters should be inspired by it.  Well, of course many voters are — just not those that have a real understanding of human rights, and the destructive track records of world governments in their various attempts to provide so-called 'economic rights' (the Scandinavian countries included — despite Bernie's repeated praise of them).

Here is a funny and mocking video from Stefan Molyneux, entitled 'The Truth About Bernie Sanders', in which he points out the obvious and idiotic fallacies that Bernie Sanders has repeated throughout his career — no surprise there, since they are the same fallacies the Democratic party has been repeating for many decades, as shown by the main points from their 1960 party platform quoted above.  It is especially comical that Sanders was a registered independent for much of his career, given that his positions are so slavishly conformist — Bernie's core positions have been Democratic Party positions for decades, and prior to Sanders first taking political office as Mayor of Burlington, Vermont, in 1981.

Stefan Molyneux repeatedly points out the obvious childish appeal of Bernie's 'you have a right to free stuff'  talk.   Molyneux's nice encapsulation of Bernie Sanders at the close of his video is transcribed below --

"So, I mean look, Sanders has other public positions, they're exactly what you expect — 'rich bad, I'll give you free stuff', rinse, wash, repeat, same thing over and over.   So, look, people have been writing saying: 'What is your opinion on Bernie Sanders?'   He's ... I mean I hate to say it (laughing) ... I went and reorganized this presentation so many times ... because ... he's boring (laughing), he's predictable, and dull.

"Like all socialists he's completely divorced from physical, economic, and human reality — but is very in tune with the discontented greed of the masses that anxiously look for scapegoats for their own irresponsibility, and beg for politicians to give them free goodies that will be stolen from everyone's future children.

"The fact that a socialist has recently surpassed potentially brain damaged Hillary Clinton in favorability polls doesn't surprise me, given that the United States has already a massive number of socialist policies in place.   What's interesting is that Sanders is not even trying to hide his socialist agenda, unlike other politicians, yet his popularity is surging in the very country that fervently opposed the Soviet Union for decades.   'Socialist' is a dirty word for a reason, but heeyyy at least he's honest.

"I recently put out a video on the causes behind the collapse of Greece, and it's called 'The Fall of Greece, Prepare Yourself Accordingly'.   I strongly recommend that you watch it, because I fear the same trend is repeating itself in the United States.

"When someone offers you something for free, it starts off as a cobweb and it ends as a chain.   It's like a bad habit — it starts as a cobweb, ends as a chain.   It's like an addiction to a drug — starts as a high, and ends with a crash and destruction.   The true freedom in life — what makes you truly free, as in liberated, not deluded — what makes you truly free, is understanding that there is no such thing as free.   There's no such thing as free in this world, and everyone who tries to tell you that there is something that you can get for free, is giving you the drug called delusion in order to enslave you forever."


Here is an informative display of the dishonesty that explains the appeal of Bernie Sanders.   Quoted below are two comments to Stefan Molyneux's video above, from a YouTube user in defense of Bernie Sanders — notice that even though Stefan spent a good portion of his video addressing how wealthy individuals change their behavior in response to higher tax levels, this individual simply ignores those inconvenient points, and pretends that the government will have no difficulty in raising the revenue required by the extravagant social agenda of Bernie Sanders.

Note that the difficulty of raising government revenues by simply raising taxes on the rich is well documented — never mind that it is unfair, and so immoral, as welfare state zealots try desperately to ignore.   See my post here, for example —
      http://maxautonomy.blogspot.com/2014/11/real-ignorance-with-bill-maher.html

And of course, there is the even more obvious attempt from this Bernie Sanders defender, in the second comment quoted below, to pretend that Sanders is not offering free stuff (like education and medical care) to certain voters.   Of course, someone is going to pay, just not those Bernie is pandering to — they will in the end, as Molyneux went to great lengths to point out, but it will be in unintended consequences (normally in reduced quality or availability, as Medicaid patients already face), allowing Bernie's supporters to pretend it was free to them.

In short, it is a bald-faced lie to insist that 'No one is claiming this will be free', because Bernie would raise taxes on the wealthy, as the author of the comments below wrote — Bernie repeatedly states emphatically that we have a right to medical care and that higher education should be free, and the only people that such obvious nonsense appeals to, are those that want someone else to pay for their supposed 'right'.   I mean, who does the author of these comments think that he is fooling?   Are all Bernie Sanders supporters this dishonest?

If Bernie Sanders clearly stated that everyone would pay a dramatic tax increase to pay for his agenda, no one would support him.   That the wealthy would pay for Bernie's agenda, making it free to Bernie's supporters, is the whole point, and it is the only reason that anyone touts the supposed virtues of Bernie Sanders --

Tw4tch s 2 months ago
Stefan is clearly clueluess on Bernie Sander's policies. Something he is being called out on in the comments and dislikes of his videos. The only people this coward responds to are the vaguest of comments. Bernie will get money for education from taxing the speculation of Wall Street and by taxing billionaires at least as much as their own employees are being taxed. Do your research, Stefan and #feelthebern
Tw4tch s 2 months ago
+DamonM Roger  *No one is claiming this will be free.* Scandanavians have plenty of money after taxes, after education and after going to the hospital. What America isnt tell us is that we have a higher personal debt for the average citizen than any Scandinavian country, yet we are still the richest country in the history of the world. Where is all that money going?


Here Molyneux responds in detail to much of the criticism to 'The Truth About Bernie Sanders'
      https://altcensored.com/watch?v=z1jCSfySGtk


In a previous post regarding Noam Chomsky's complete lack of credibility, I quoted a large section of Ayn Rand's essay 'Collectivized Ethics', from her book 'The Virtue of Selfishness', since that essay so eloquently describes the contemptible and perverse psychology so widely displayed by Chomsky and many others like him, in their massively confused zeal to pretend that the initiation of force can be moral.   It is especially perverse in Chomsky's case, since he repeatedly argues that the U.S. is the leading terrorist state.   Chomsky really seems convinced that a leading terrorist state should have massive control over its citizens.   See my previous post for details —
      http://maxautonomy.blogspot.com/2015/06/noam-chomsky-losing-all-credibility.html

And just like Chomsky, Bernie Sanders provides an excellent real-life example of Ayn Rand's description of so-called humanitarians in her essay 'Collectivized Ethics'.   It is so easy to pretend to be a humanitarian, when it costs you nothing, and even profits you with political power via control over dull ignorant voters, while your sole course of action is to force the redistribution of the labor of others.   Someone else does the work, but you can take the credit — while a slavish and obsequious public praises you for 'caring solely about what is best for people'.

Here is a perfect demonstration of that slavish obsequious public — Sarah Silverman's comment in this video that Bernie is 'not for sale' is especially ironic, given that Bernie has spent his political career pandering to the ugly envies of the worst voters (again, not exactly what one would call independent) —
     https://www.youtube.com/watch?v=TvJ5vdIUksM

In closing, here is the relevant portion of Ayn Rand's essay 'Collectivized Ethics' again (this deserves to be re-read) --

https://www.youtube.com/watch?v=2OvL1_89QDs
http://www.aynrand.org/novels/virtue-of-selfishness
...
Since nature does not guarantee automatic security, success and survival to any human being, it is only the dictatorial presumptuousness and the moral cannibalism of the altruist-collectivist code that permits a man to suppose (or idly to daydream) that he can somehow guarantee such security to some men at the expense of others.

If a man speculates on what “society” should do for the poor, he accepts thereby the collectivist premise that men’s lives belong to society and that he, as a member of society, has the right to dispose of them, to set their goals or to plan the “distribution” of their efforts.

This is the psychological confession implied in such questions and in many issues of the same kind.

At best, it reveals a man’s psycho-epistemological chaos; it reveals a fallacy which may be termed “the fallacy of the frozen abstraction” and which consists of substituting some one particular concrete for the wider abstract class to which it belongs—in this case, substituting a specific ethics (altruism) for the wider abstraction of “ethics.”  Thus, a man may reject the theory of altruism and assert that he has accepted a rational code—but, failing to integrate his ideas, he continues unthinkingly to approach ethical questions in terms established by altruism.

More often, however, that psychological confession reveals a deeper evil: it reveals the enormity of the extent to which altruism erodes men’s capacity to grasp the concept of rights or the value of an individual life; it reveals a mind from which the reality of a human being has been wiped out.

Humility and presumptuousness are always two sides of the same premise, and always share the task of filling the space vacated by self-esteem in a collectivized mentality.  The man who is willing to serve as the means to the ends of others, will necessarily regard others as the means to his ends.  The more neurotic he is or the more conscientious in the practice of altruism (and these two aspects of his psychology will act reciprocally to reinforce each other), the more he will tend to devise schemes “for the good of mankind” or of “society” or of “the public” or of “future generations” —or of anything except actual human beings.

Hence the appalling recklessness with which men propose, discuss and accept “humanitarian” projects which are to be imposed by political means, that is, by force, on an unlimited number of human beings.  If, according to collectivist caricatures, the greedy rich indulged in profligate material luxury, on the premise of “price no object”—then the social progress brought by today’s collectivized mentalities consists of indulging in altruistic political planning, on the premise of “human lives no object.”

The hallmark of such mentalities is the advocacy of some grand scale public goal, without regard to context, costs or means.  Out of context, such a goal can usually be shown to be desirable; it has to be public, because the costs are not to be earned, but to be expropriated; and a dense patch of venomous fog has to shroud the issue of means—because the means are to be human lives.

“Medicare” is an example of such a project.  “Isn’t it desirable that the aged should have medical care in times of illness?” its advocates clamor.  Considered out of context, the answer would be: yes, it is desirable.  Who would have a reason to say no?  And it is at this point that the mental processes of a collectivized brain are cut off; the rest is fog.  Only the desire remains in his sight—it’s the good, isn’t it?—it’s not for myself, it’s for others, it’s for the public, for a helpless, ailing public ... The fog hides such facts as the enslavement and, therefore, the destruction of medical science, the regimentation and disintegration of all medical practice, and the sacrifice of the professional integrity, the freedom, the careers, the ambitions, the achievements, the happiness, the lives of the very men who are to provide that “desirable” goal—the doctors.

After centuries of civilization, most men—with the exception of criminals—have learned that the above mental attitude is neither practical nor moral in their private lives and may not be applied to the achievement of their private goals.  There would be no controversy about the moral character of some young hoodlum who declared: “Isn’t it desirable to have a yacht, to live in a penthouse and to drink champagne?”—and stubbornly refused to consider the fact that he had robbed a bank and killed two guards to achieve that “desirable” goal.

There is no moral difference between these two examples; the number of beneficiaries does not change the nature of the action, it merely increases the number of victims.  In fact, the private hoodlum has a slight edge of moral superiority: he has no power to devastate an entire nation and his victims are not legally disarmed.

It is men’s views of their public or political existence that the collectivized ethics of altruism has protected from the march of civilization and has preserved as a reservoir, a wildlife sanctuary, ruled by the mores of prehistorical savagery.  If men have grasped some faint glimmer of respect for individual rights in their private dealings with one another, that glimmer vanishes when they turn to public issues—and what leaps into the political arena is a caveman who can’t conceive of any reason why the tribe may not bash in the skull of any individual if it so desires.
...


Sunday, June 28, 2015

Krugman's Obviously False Debt Spin

In the past, I've written numerous posts in response to Paul Krugman's nonsensical writing, in an attempt to expose him as a charlatan.   Because Krugman is a devout Keynesian, he believes that government spending is always an unqualified positive, and an easy solution to all economic problems.

If you thank that is an exaggeration, watch Krugman in this interview from August, 2011, where he parrots Keynes in supporting government stimulus spending, with his explicit statement that the spending be on something that wastes resources and helps no one — that is, a military buildup for a fictitious alien invasion --

http://www.youtube.com/watch?v=nhMAV9VLvHA
http://krugman.blogs.nytimes.com/2013/05/09/the-moral-equivalent-of-space-aliens/
If we discovered that, you know, space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months.  And then if we discovered, oops, we made a mistake, there aren’t any aliens, we’d be better [off].


Paul Krugman's blog is dominated by content like the statement quoted above, which makes it little more than an endless stream of fallacies.   Here is another typical example, from a Krugman post in February, 2015, where Krugman attempts to dismiss concerns about the mounting U.S. public debt --

http://krugman.blogs.nytimes.com/2015/02/06/debt-is-money-we-owe-to-ourselves/

Debt Is Money We Owe To Ourselves
Paul Krugman   FEBRUARY 6, 2015 7:32 AM
Antonio Fatas, commenting on recent work on deleveraging or the lack thereof, emphasizes one of my favorite points: no, debt does not mean that we’re stealing from future generations. Globally, and for the most part even within countries, a rise in debt isn’t an indication that we’re living beyond our means, because as Fatas puts it, one person’s debt is another person’s asset; or as I equivalently put it, debt is money we owe to ourselves — an obviously true statement that, I have discovered, has the power to induce blinding rage in many people.

Think about the history shown in the chart above. Britain did not emerge impoverished from the Napoleonic Wars; the government ended up with a lot of debt, but the counterpart of this debt was that the British propertied classes owned a lot of consols.

More than that, as Fatas points out, rising debt could be a good sign. Think of my little two-classes model of debt, where some people are less patient than others — perhaps (to step outside the model a bit) because they have better investment opportunities. Moving from a very limited financial system that doesn’t allow much debt to a somewhat more open-minded system should, in that case, be good for growth and welfare.

The problem with private debt is that we have good reason to believe that in very wide-open financial systems people get irrationally exuberant, lending and borrowing to an extent that they eventually realize was excessive — and that there are huge negative externalities when everyone tries to deleverage at once. This is a very big problem, but it’s not about generalized excess consumption.

And the problems with public debt are also mainly about possible instability rather than “borrowing from our children”. The rhetoric of fiscal debates has been, for the most part, nonsense.



Krugman's blog post quoted above hardly deserves comment — since it is so poorly written, the fallacies it contains should be obvious to almost anyone.

First, the title is obviously false — it is true that the largest portion of the U.S. public debt is held by government agencies (mainly Social Security), but a large portion of the U.S. debt is held by foreign nations.   Here is part of a table from the U.S. Treasury's June 2015 Bulletin, showing the estimated ownership of U.S. Treasury Securities, from 2010 through March 2015.  Notice that this table shows that 'foreign and international' owners (column 11) were holding about 34% of the total U.S. public debt in December of 2104 --

https://www.fiscal.treasury.gov/files/reports-statements/treasury-bulletin/b2015-2.pdf   (p. 43)
https://web.archive.org/web/.../https://www.fiscal.treasury.gov/files/reports-statements/treasury-bulletin/b2015-2.pdf

Table of Estimated Ownership of U.S. Treasury Securities, June 2015


And notice that China and Japan alone were holding over 13% of the U.S. public debt in March of 2015 --

http://ticdata.treasury.gov/Publish/mfh.txt

Top Two Foreign Holders of U.S. Treasury Securities, 2014 - 2015


But regardless of the breakdown of the ownership of the U.S. public debt, Krugman's statement that 'debt is money we owe to ourselves — an obviously true statement',  is, rather, an obviously false statement.   There is nothing about government debt in general that entails 'taxpayers owing it to themselves'.   At a minimum, this would mean that all government debt securities are purchased by the government with tax revenue.   This was never true, and it certainly is not true now.

But even more importantly, notice that even in the case of the Social Security Administration's past purchase of government treasuries with surplus payroll deductions — as an example of 'owing it to ourselves' — we do not 'owe it to ourselves', since current beneficiaries of government programs like Social Security and Medicare will not pay, nor will they even suffer any consequences of, the growing debt that is being generated in part to pay for their benefits — obviously, future taxpayers will, since current taxpayers will not live long enough.

So even under the assumption that the phrase 'owing it to ourselves'  is simply meant to indicate government debt that was purchased with tax revenue, and so is held by government agencies (i.e. debt owned by U.S. taxpayers), that debt will still affect future taxpayers more than current taxpayers (especially given future interest rate increases).   In short, Krugman's phrase — 'debt is money we owe to ourselves' — is a euphemism to disguise the unequal impacts of the debt between current and future taxpayers.

So how is it possible to justify Krugman's claim: 'no, debt does not mean that we’re stealing from future generations',  when we know that the growing debt is certainly not helping future generations?

But what is truly perversely fascinating in this nonsensical 'we owe money to ourselves'  talk, is that anyone would take this seriously — never mind a Nobel laureate economist.

I wrote about the absurdity of pretending you owe yourself money last year in this post —
     http://maxautonomy.blogspot.com/2014/06/pretending-you-owe-yourself-hazard.html

In Krugman's blog post quoted above, he mentions that one person's debt is another person's asset — yes, but this is only true if there really are two different people.  Your debt is not also your asset.   So making the claim that your debt is your largest asset, is exactly the same as saying 'I'm broke'.   All debt is a claim against future earnings, and government debt is a claim on the future earnings of taxpayers, regardless of the owner of that government debt.   This is what makes the commonly heard comment that the Social Security 'trust fund' pays benefits so absurd — all the government 'trusts' that hold U.S. Treasuries are simply promises to collect future taxes (i.e. they are claims on future tax receipts), and so future taxpayers must pay, if those securities are ever to be redeemed in order to pay some government expense, like Social Security or Medicare benefit payments.

It is hard to believe that it is not obvious to people that they cannot also treat their debt as an asset, and that it should require an explanation as to why, but it must, since it is repeated ad nauseam — even by a Nobel laureate.

Making the claim that we 'owe it to ourselves'  does nothing to mitigate a debt problem.  The U.S. government 'trust funds' are an unfunded liability of U.S. taxpayers — that is, they are promises to collect payments from future taxpayers.   And notice that this simple fact — which is determined by the U.S. Treasury securities held by the trusts (that's just how they work) — stands in direct contradiction to Krugman's claim that 'debt does not mean that we’re stealing from future generations'.   The larger the U.S. debt grows — including the so-called 'trusts' — the larger the burden that will be borne by future taxpayers.

Here are more details on how the government trusts are a liability to U.S. taxpayers.  If you are a U.S. taxpayer, you pay for the U.S. trust funds, they do not pay for you —
     http://maxautonomy.blogspot.com/2015/05/the-trust-fund-tolls-for-thee.html

And notice the glaring contradiction in Krugman's comment that private lenders alone have a tendency to become 'irrationally exuberant'.   I suppose this is his shorthand code to readers who wish to pretend that government requirements had nothing to do with the financial crisis of the Great Recession.   This notion that governments are consistently rational and responsible, in contrast to the private sector, is so utterly ridiculous there is no reason to comment on it.   Anyone who responds affirmatively to such a comment is simply expressing a blindness driven by a biased agenda.   The crises, strife, and misery, caused directly by the world's governments are too widely well known to be worthy of mention.

To those who would now launch into a diatribe about the obvious harm that has been caused by private companies (no argument here), I would only say that your moral compass and your ability to measure harm are a bit off.   Good luck.

Of course, this is consistent with Krugman's mantra that all government spending has some magical ability to create well being, whereas private sector spending or saving does not.  That Krugman would be comfortable in repeating such a ridiculous claim, as well as 'Debt Is Money We Owe To Ourselves', is a testament to how insulated he is from any real criticism.

So much for the Nobel prize.

Sunday, May 24, 2015

The 'Trust Fund' Tolls For Thee

Here's a description of the Social Security and Medicare trust funds on the Social Security website, in the 'SUMMARY OF THE 2014 ANNUAL REPORTS'  from the Social Security and Medicare Board of Trustees.  Pay special attention to the second paragraph, and recall that any investment in U.S. Government securities puts money in the U.S. Government's general fund to be spent — that is, both the principle and interest payments for U.S. Government securities (whether marketable or not), are made from the earnings of U.S. taxpayers --

http://www.ssa.gov/oact/trsum/
https://www.ssa.gov/oact/TR/2014/index.html

...
What Are the Trust Funds?  Congress established trust funds managed by the Secretary of the Treasury to account for Social Security and Medicare income and disbursements.  The Treasury credits Social Security and Medicare taxes, premiums, and other income to the funds.  There are four separate trust funds.  For Social Security, the Old-Age and Survivors Insurance (OASI) Trust Fund pays retirement and survivors benefits and the DI Trust Fund pays disability benefits.  (OASDI is the designation for the two trust funds when they are considered on a theoretical combined basis.)  For Medicare, the Hospital Insurance (HI) Trust Fund pays for inpatient hospital and related care.  The Supplementary Medical Insurance (SMI) Trust Fund comprises two separate accounts: Part B, which pays for physician and outpatient services, and Part D, which covers the prescription drug benefit.  In 2013, 47.0 million people received OASI benefits, 11.0 million received DI benefits, and 52.3 million were covered under Medicare.

The only disbursements permitted from the funds are benefit payments and administrative costs.  Federal law requires that all excess funds be invested in interest-bearing securities backed by the full faith and credit of the United States.  The Department of the Treasury currently invests all program revenues in special non-marketable securities of the U.S. Government which earn a market rate of interest.  The balances in the trust funds, which represent the accumulated value, including interest, of all prior program annual surpluses and deficits, provide automatic authority to pay benefits.
...


Now notice these paragraphs from the same page, and especially the statement that deficits in these programs contribute to U.S. Federal budget deficits, and that the redemption of trust fund bonds provides no new net income to the Treasury --

http://www.ssa.gov/oact/trsum/
https://www.ssa.gov/oact/TR/2014/index.html

...
What are the Budgetary Implications of Rising Social Security and Medicare Costs?  Concern about the long-range financial outlook for Medicare and Social Security often focuses on the depletion dates for the HI and OASDI trust funds—the times when the projected trust fund balances under current law will be insufficient to pay the full amounts of scheduled benefits.  A more immediate issue is the effect the programs have on the unified Federal budget prior to depletion of the trust funds.

Chart D shows the excess of scheduled costs over dedicated tax and premium income for the OASDI, HI, and SMI trust funds expressed as percentages of GDP.  Each of these trust funds’ operations will contribute increasing amounts to Federal unified budget deficits in future years.  General revenues pay for roughly 75 percent of all SMI costs.  Until 2030, interest earnings and asset redemptions, financed from general revenues, will cover the shortfall of HI tax and premium revenues relative to expenditures.  In addition, general revenues must cover similar payments as a result of growing OASDI deficits through 2033.

In 2014, the projected difference between Social Security’s expenditures and dedicated tax income is $80 billion.  For HI, the projected difference between expenditures and dedicated tax and premium income is $25 billion.  The projected general revenue demands of SMI are $248 billion.  Thus, the total General Fund requirements for Social Security and Medicare in 2014 are $352 billion, or 2.0 percent of GDP.  Redemption of trust fund bonds, interest paid on those bonds, and transfers from the General Fund provide no new net income to the Treasury, which must finance these payments through some combination of increased taxation, reductions in other government spending, or additional borrowing from the public.

Projected SMI/OASDI/HI General Revenue Funding, Percent of GDP
...


The last sentence in the quote above deserves to be repeated, since so many people wish to pretend that the Social Security and Medicare 'trust funds' hold assets that are helpful to taxpayers, rather than simply a claim on their wages —
Redemption of trust fund bonds, interest paid on those bonds, and transfers from the General Fund provide no new net income to the Treasury, which must finance these payments through some combination of increased taxation, reductions in other government spending, or additional borrowing from the public.
This is probably the clearest statement that will ever come from the government that the bonds in the trust funds do not represent an asset to taxpayers.  As stated above, if the redemption of trust fund bonds is expected to generate any funds to be spent (as one would expect), the only way to finance that spending is through increased taxation or additional borrowing.

Without additional taxation or borrowing, the dollar amounts of the bonds in the trust funds cannot be spent — so the only way to prevent the trust fund bonds from triggering new taxation or borrowing is to throw them away (i.e. not redeem them).

In short, the trust fund bonds simply act as an accounting tool — a way to track the debt owed by U.S. taxpayers, that they must pay in order for future recipients of Social Security and Medicare to actually receive meaningful benefit payments.

If you are a U.S. taxpayer, the U.S. government trust funds do not make payments to you — you make payments to them.