I had taken a bit of a break from reading philosophy to give my mind a bit of a rest. I re-read for the umpteenth time, "Beguilement" by Lois McMaster Bujold. This is one of my favorite books, series actually.
It was something of a different experience reading it after having read of lot of Ayn Rand's philosophy as I could see similar themes, especially in the main characters who, over the course of the series, go against what is expected of them and instead work for what gives them the most fulfilling lives and in the process improve the lives of everyone around them.
At any rate, I am back reading "Capitalism: The Unknown Ideal" by Ayn Rand and soon came across another great quote.
Remember that private citizens-whether rich or poor, whether businessmen or workers-have no power to start a war. That power is the exclusive prerogative of a government. Which type of government is more likely to plunge a country into war: a government of limited powers, bound by constitutional restrictions-or an unlimited government, open to the pressure of any group with warlike interests or ideologies, a government able to command armies to march at the whim of a single chief executive? Yet it is not a limited government that today's peace-lovers are advocating. [emphasis mine]
Corporations receive a lot of blame for the supposed ills of the world (while at the same time not receiving any credit for the good that has come from them) especially for their "influence" on government. It seems that few people stop to ask themselves how much corporations would lobby and try to manipulate government if government was limited and restricted from interfering in the economy? As Yaron Brook points out in a number of his talks, before the Department of Justice went after Microsoft, the tech giant spent virtually nothing on political lobbying. Corporations, like individuals, respond to incentives. When government interference and regulation make it more profitable for a company to spend their money lobbying than developing innovative new products, is it any wonder that is what they do?
Today's quote comes from a talk by Ayn Rand, I believe from the 1960's, about the so-called Robber Barons of the 19th century, and how they were actually the greatest benefactors of the United States, contrary to what popular history tells us. About 5 minutes into the recording, which you can find here, she made a statement that jumped out at me enough to go over it repeatedly to write it down. The groups she is referring to are the Central Pacific and Union Pacific railroads.
In both cases, the main motive of the men involved in building these railroads, though not the exclusive but the main motive, was to acquire the subsidies, not to build a railroad. More than that, there was as yet no economic need for a transcontinental railroad. There was not enough freight to justify private investment, but the government, under propaganda similar to today's and such excuses as the prestige of the country, decided to build a railroad and it did so by means of giving subsidies to private groups.
You could very easily substitute "green energy" for "transcontinental railroad" and the quote would be applicable to current government policy. How often do we hear "We are falling behind in green energy technology!" or similar slogans when the government touts its subsidies for such projects?
I guess the old saying is true: "Those who do not learn from history are doomed to repeat it."
For those that may be curious, the quotes I have started posting are from my current reading, pretty much posted as I come to them. They are passages that jump out at me as I go along.
This particular quote is from Ayn Rand's book "Capitalism: The Unknown Ideal" and is in the section discussing reason as man's means of survivial. As she says a bit earlier: "The action required to sustain human life is primarily intellectual: everything man needs has to be discovered by his mind and produced by his effort." You have only to look around and see all things that are needed to allow man to survive in the world (food, shelter, clothing, defense, and etc) and enjoy life (books, movies, music, travel, and etc) to see that this is true.
"Since knowledge, thinking, and rational action are properties of the individual, since the choice to exercise his rational faculty or not depends on the individual, man's survival requires that those who think be free of the interference of those who don't. Since men are neither omniscient nor infallible, they must be free to agree or disagree, to cooperate or to pursue their own independent course, each according to his own rational judgement. Freedom is the fundamental requirement of man's mind."
Came across this quote today in Ayn Rand's essay titled "The Nature of Government", found in the book "Capitalism: The Unknown Ideal." It seems appropriate given all that is coming out of Washington these days:
"...instead of serving as the instrument of objectivity in human relationships, the government is creating a deadly, subterranean reign of uncertainty and fear, by means of non-objective laws whose interpretation is left to the arbitrary decisions of random bureaucrats..."
This seems to me to be a spot on description of how large portions of the government operates today. From the EPA to the IRS to Obamacare, the actual decisions on how to implement a rule and when are left to the whim of the bureaucrats involved. We have seen this in the targetting of certain groups for extra scrutiny based on factors unrelated to the issue at hand and in the large number of instances of the phrase "as the Secretary shall decide" in the Obamacare legislation.
I've always had a hard time with the concept of compromise when it comes to government. For reasons I could never really define, I was uneasy by the concept that you should accept something you fundamentally did not agree with in order to obtain something you wanted, or in the case of government, in return for a promise to vote for something you wanted in the future.
Of course I would always be told that government was all about compromise and look at how the Founding Fathers had to compromise in order to write the Constitution. Still, it did not make any sense to me and despite this "explanation", it didn't seem right.
Recently I came across the writings of Ayn Rand and things started to become clearer. In regards to compromise, the following quotes struck home for me:
"It is only in regard to concretes or particulars, implementing a mutually accepted basic principle, that one may compromise. For instance, one may bargain with a buyer over the price one wants to receive for one’s product, and agree on a sum somewhere between one’s demand and his offer. The mutually accepted basic principle, in such case, is the principle of trade, namely: that the buyer must pay the seller for his product. But if one wanted to be paid and the alleged buyer wanted to obtain one’s product for nothing, no compromise, agreement or discussion would be possible, only the total surrender of one or the other."
"In any compromise between food and poison, it is only death that can win. In any compromise between good and evil, it is only evil that can profit."
To me this made perfect sense to me. It helped me realize that it was on principles where I did not want to accept that compromise was valid. Pretty much every issue in government, major ones at any rate, involve principles. So for example, if on principle you believe it is wrong for the government to use its coercive power to redistribute wealth from one segment of the population to another, then it would be immoral and evil to do anything that increases the burden of taxes as this would be compromising your basic principles.
On the other hand, on issues where there is not a difference on basic principle, national defense for example (at least I hope everyone in government agrees we have a right to protect our interests), it is perfectly moral to compromise (to a point) on how to go about that task, how much to spend and how to fund it and so forth.
Unfortunately it appears that government today is all about compromising on both details and principle and the mainstream media agrees, and tends to support the view of the Democrats. In this week's Time magazine there is an article, "Cliff Dweller" by Michael Grunwald which has the following quote:
"if Senate Republicans had decided to work with Obama in his first term instead of fighting him, they could have helped shape Obamacare and other Democratic legislation."
So apparently the feeling in the media, and I think in large parts of the population, is that the Republicans should compromise their principles and go along with the Democrat agenda to help "shape" the legislation. In the case of Obamacare, this is essentially saying that if Republicans are opposed on principle to allowing the Federal government to compel citizens to purchase a product, they should set aside that principle and work with those feel it is proper for the government to do so. To do so is not a compromise, but an abdication of your principles.
Sadly, I don't believe many Republican members of Congress actually hold the principles they claim to hold. As one example, the individual mandate in Obamacare has roots on the Republican side. One need only take a glance at this article on Fox News to see it has a long history of Republican support. In the final debate between Mitt Romney and President Obama, my main impression was there was no principle difference between the two in many areas. Many of Romney's answers appeared to me to be variations on "I agree with the President, but I think I can do it better." So it is merely the details, not the underlying principles, that they differed on.
It should be obvious that most members of Congress hold the same statist and altruistic principles, though the details vary. Very few would argue for reducing and eventually eliminating the welfare/regulatory state we live in, only how to fund it and run it more efficiently (i.e. look at the expansion of regulation under Sarbanes-Oxley which had no dissenting votes in the Senate and only 3 in the House). Even Paul Ryan's so-called "radical" budget plan doesn't cut government spending, rather it simply slows the growth so that the budget will balance, at a higher level, in 20 years or so.
The main difference between the two parties is that the Democrats present a more consistent message of these principles. They openly state that it is the government's job to provide cradle to the grave economic security for everyone and take whatever steps required to achieve that whether that be higher taxes, banning large soft drinks, compelling companies to provide nutrition labels and so forth. The Republicans tend to say the opposite, talking of personal freedom and individual rights, while pursuing many of the same goals.
I think one final quote from Ayn Rand perfectly sums up how we have arrived at the situation we find ourselves in as a country:
Consider a few rules about the working of principles in practice and about the relationship of principles to goals . . . .
In any conflict between two men (or two groups) who hold the same basic principles, it is the more consistent one who wins.
In any collaboration between two men (or two groups) who hold different basic principles, it is the more evil or irrational one who wins.
When opposite basic principles are clearly and openly defined, it works to the advantage of the rational side; when they are not clearly defined, but are hidden or evaded, it works to the advantage of the irrational side.
I had a little interaction on Twitter the other day that got me thinking. A dangerous thing as my brother might tell me.
I had posted to Twitter:
Ah, first paycheck of the year, first view of my higher taxes. And people say the government can't work fast.
The difference in my paycheck was just the ending of the so called "payroll tax holiday."
This garnered a decent number, for me, of favorites, retweets and even a few new followers. It also drew one direct reply:
This was a two year tax holiday; would you like to have it made permanent? Why not lower the rate to 0%, and borrow 100%?
Implicit in this reply is that Social Security is a fact of reality that is not subject to change and that the only choice open to us is how we fund it.
This is a pretty common assumption, or at least not uncommon. A quick search revealed any number of similar reactions a year ago when the payroll tax holiday was extended. For example:
Investor's Business Daily (one of my favorite newspapers) said, "Result: cash for pizza now — and smaller Social Security checks later." Truth Sandwich's headline read: "Raiding the Social Security Piggy Bank for Pizza Money" CNS News reported, quoting Rep. Frank Wolf (R-VA), "Wolf called the payroll tax extension a "raid on Social Security, which is already going broke," and he noted that the money paid into the system now -- through payroll taxes -- pays benefits for existing retirees."
This was pretty much my reaction at the time. I felt that if we have a Social Security system that is by all accounts already looking at trouble down the road it is foolish to knowingly take in less money. For those that don't believe that Social Security is on shaky ground, here is a quote from Social Security Administration that they used to send out when they mailed statements to people:
"Your estimated benefits are based on current law. Congress has made changes to the law in the past and can do so at any time. The law governing benefit amounts may change because, by 2037, the payroll taxes collected will be enough to pay only about 76 percent of scheduled benefits.”
There are a number of philosophical issues with a Social Security system. The first is that it essentially requires that you work/live for the benefit of someone else. To whatever extent you are living for someone else's benefit you are NOT living for your own. Given that we are forced to live for others, as opposed to choosing to do it for your own reasons, we are not free. As Ayn Rand put it, "Living for others is slavery -- and nothing else whatever -- and no names, ends or excuses can alter the fact."
Contrary to popular belief, the government is not saving and investing your contributions in order to give you income during your retirement. Rather, money paid in today is used to pay benefits to those collecting them today. In the past, more revenue was collected in payroll taxes than was needed to pay the current benefits and the surplus was used to fund other parts of the government in return for IOUs (Treasury bonds) which were put in the "Trust Fund." Now that payroll taxes are no longer covering current benefits, bonds from the "Trust Fund" need to be redeemed. Which means the cash needed to pay shortfall is coming from general tax revenues further burdening current tax payers. This latter problem will worsen as demographics catch up with us and there are fewer and fewer workers paying taxes to support retirees. In the 1930s it was about 17 workers for 1 retiree and now it is approaching 2 to 1.
There have been a number of models for privatizing Social Security which would appear to remove the issue of requiring people to work for the sake of others. Two of the more often mentioned systems are those of Chile and Galveston, Brazoria and Matagorda counties in Texas.
Chile converted their system from an untenable government run system to a privately invested system where the individuals can decide how their money is invested. So far this seems to a lot of improvements over the government run system. One interesting side effect is that savings rates are higher than before the private system which certainly helps long term growth.
The three counties in Texas took advantage of a since-closed loophole in the law and opted out of Social Security in 1981 and convert to a privately invested system. These counties pool the contributions and then money management firms bid to manage this money with certain restrictions on guaranteeing rates of returns. Even the report from the Social Security Administration indicates that in many ways the private program is as good and often better than Social Security. In the areas where it appears Social Security is better it is unclear whether the figures given for Social Security include the reduction in benefits that would appear to certain to occur around 2037 (the examples given in the report are for workers retiring in 2045). Assuming the government doesn't increase payroll taxes by about 1/3, at current estimates, then benefits as noted above would be reduced by 24% making the private plan in these counties better in pretty much all areas.
The problem with both of the above alternatives is that they use government force to compel the workers involved to participate. (Well, in the case of the counties in Texas, workers are compelled to either participate in the private plan or social security.) While the government properly should have the monopoly on the use of force in a civilized society, this force should only be used in retaliation against those who initiation the use of force unlawfully. The government should never be the initiator of force against the innocent.
When the government uses force to compel behavior, or prevent behavior that does not infringe on the rights of others, it effectively takes away our right to use our own mind and reason to decide what the best course of action for ourselves is. When the government compels someone to save X% of their income towards retirement it precludes the person from using that money for something else.
Maybe the person would like to start their own business but because of such a law they would be unable to save the money needed to begin, or would be so delayed that the opportunity would disappear and the person's future be worse off as a consequence. Maybe the person would decide to take a trip, buy a new computer or whatever and not bother with saving for the future. Either way, man's most important right, the one he cannot truly live without, is the right to live his life as he sees fit based on his own reason.
Below is Yaron Brook of the Ayn Rand Institute discussing the entitlement problem in the United States.
So my feeling is the the ultimate answer is essentially the same as what Yaron speaks of in the video. As I put it in response to the tweet quoted above:
or how about phasing out Social Security all together and let individuals plan for themselves?
After I started writing this post, I noticed I had a reply to my response. I was a little surprised, but pleasantly so, given my preconception based on the initial reply:
That would be the best idea, since it isn't a "retirement plan" and is nothing more than an entitlement program.
