On December 23, 1783, George Washington resigned as commander-in-chief of the Continental Army, at the Maryland State House in Annapolis, Maryland.
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Washington Resigns
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Henry David Thoreau
“The progress from an absolute to a limited monarchy, from a limited monarchy to a democracy, is a progress toward a true respect for the individual.”
Henry David Thoreau, “Resistance to Civil Government,” Aesthetic Papers, 1849 (republished in a variety of titles, including On the Duty of Civil Disobedience).
Subsidize something, and you tend to get more of it.
But wait, what if you subsidize demand for something, but don’t really allow (or continue to disallow) increased supply?
Then prices for that something go way up.
This is elementary economics — nothing controversial about it.
Except that politicians and bureaucrats who make public policy tend not to acknowledge this aspect of reality when they propose subsidies. Instead, they expect praise for their “heroic” and “caring” program of destruction.
They need to be educated. But, alas, all this applies best to college education. How does one educate the educators?
A new study, which reliable economists tell me is “sophisticated,” finds that the bulk of recent college tuition price inflation can, indeed, be directly linked to the federal government’s loan subsidies.
This study makes for some opaque reading, alas: “Essentially, demand shocks lead to higher college costs and more debt, and in the absence of higher labor market returns, more loan default inevitably occurs.” Yikes.
The college education bubble has been much talked-about for years, at least amongst skeptics of government policy. But in hushed tones — the big fear, here, is that a bursting of the bubble will lead to — who knows what? I mean, who-knows-what policy reaction.
Probably just more government subsidy and control. And even higher tuition still. Double yikes.
Thankfully, while the brick-and-mortar higher education institutions suck up more and more government-backed money, the Internet is enabling some great alternatives. The future, I think, does not belong to the university system as we have known it.
This is Common Sense. I’m Paul Jacob.
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Arthur Latham Perry
“By far the most important of all the conditions, under which the production of material commodities goes broadly forward, is liberty of action on the part of the individual; because, wherever such liberty is conceded, association and invention and all other needful conditions follow right along by laws of natural sequence.”
Arthur Latham Perry, Principles of Political Economy, 1891.
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Dictator Overthrown
On December 22, 1989, Communist President of Romania Nicolae Ceaușescu was overthrown by Ion Iliescu after days of bloody confrontations. The deposed dictator and his wife fled Bucharest with a helicopter as protesters erupted in cheers.
Capitalism can be rigged a hundred different ways, apparently. China’s is run by its Communist Party, and even current innovations bear the stamp of the Party.
Take “social credit.”
Not the quaint decentralist economic reform movement that was a minor deal in politics on the West Coast of the U.S. and Canada 60 or more years ago.
What I’m referring to is the innovative credit scoring system devised by a gaming company in cooperation with China’s commie-run government.
But it’s not quite like the credit scoring systems set up by competing companies in the U.S., which cook up “credit scores” based on going into debt and paying off debt. If you pay your bills, you get a higher score. If you don’t, it plummets.
The new “Sesame” credit scoring system is less interested in the debts you pay off and more in what you buy and what you put up on social media. The company has concocted a secret algorithm, and gives higher scores to good citizens — obedient people — and lower scores to lazy people (inferred from, say, if you play a lot of video games) or to folks who are rebellious free thinkers (posting pictures of Tank Man in Tiananmen Square, for example).
That is what it seems like, so far.
It rewards those Chinese who are industrious (yay?) and who kowtow to Communist Party expectations (yikes!) — and makes me extra glad I live in the U.S., where government is too chaotic and stupid to cook up anything quite this insidious.
This is Common Sense. I’m Paul Jacob.
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Rock and Rebellion
On December 21, 1620, William Bradford and the Mayflower Pilgrims landed on what is now known as Plymouth Rock in Plymouth, Massachusetts.
American settlers in Nacogdoches, Mexican Texas, declared their independence on December 21, 1826, starting the Fredonian Rebellion.
Avant-garde rock ‘n’ roll guitarist, band leader, and composer Frank Zappa was born on this date in 1940. In 1985, Zappa testified before the United States Senate Commerce, Technology, and Transportation committee, attacking the Parents Music Resource Center or PMRC, a music organization co-founded by Tipper Gore, wife of then-senator Al Gore. Zappa was a passionate advocate for freedom of speech, self-education, political participation and the abolition of censorship. Describing his political views, Frank Zappa categorized himself as a “practical conservative,” or “independent.” He died in 1993.
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Arthur Lee
“The right of property is the guardian of every other right, and to deprive the people of this, is in fact to deprive them of their liberty.”
Arthur Lee, brother of Richard Henry, Francis Lightfoot and William Lee.
Fixing the welfare state, for everybody’s benefit, should be high on the political agenda. But if a fix isn’t possible, maybe we should be thinking more radically about its very real problems.
Click on over to Townhall.com, for Paul Jacob’s December 20, 2015, column. Then come back here, for more information.
- Cato: “Finland to Break New Ground with Basic Income Experiment,” by Charles Hughes
- Independent Institute: “Property Rights, Coercion, and the Welfare State: The Libertarian Case for a Basic Income for All,” by Matt Zwolinski
- Independent Institute: “A Philosophical Economist’s Case against a Government-Guaranteed Basic Income,” by David R. Henderson
- The Tom Woods Show: “Should Libertarians Support a Basic Income Guarantee?,” Tom Woods interviewing Matt Zwolinski
- The Foundation for Law, Justice and Society: “Guaranteed Income as a Replacement for the Welfare State,” by Charles Murray
- The Atlantic: “The Conservative Case for a Guaranteed Basic Income,” by Noah Gordon
- Cato: “Tangled Web of Welfare Programs Creates High Tax Rates on Participants,” by Charles Hughes
- Congressional Budget Office: “Effective Marginal Tax Rates for Low- and Moderate-Income Workers in 2016”
- The Guardian: “Even in Finland, universal basic income is too good to be true,” by Declan Gaffney
- Adam Smith Institute: “Will the Finns be the first to introduce a basic income?” by Mikko I Arevuo
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Diplomat and Spy
On December 20, 1740, Arthur Lee — Revolutionary Era diplomat, spy, and Virginia delegate to the Continental Congress — was born. He practiced law in London from 1770 to 1776, where he wrote polemics against slavery and in defense of the American colonies’ resistance to the Townshend acts and other tyrannical British policies.
He was brother to Richard Henry Lee and Francis Lightfoot Lee.