Author: bmboone

I am a sixty -three year old father of two and grandfather of one and have been married for 30 years. I am a forensic accountant/economist and am a partner in a professional services firm providing litigation support in the form of expert testimony. Prior to beginning my career as a forensic expert, I was the CFO of a large regional wholesale mortgage banking company. I have a masters in business administration from the University of California at Davis Graduate School of Management. I completed my undergraduate studies at Claremont McKenna College earning a Bachelor of Arts in Economics/Accounting. I was an athlete in college; I played football at Claremont McKenna named a captain of my team and to the all conference second team two seasons as a linebacker. I play the guitar and an occasional game of golf. I am interested in my family history.

Political Prejudice in America

The latin origin of the word prejudice is the combination of “prae” (meaning “in advance”) and the word “judicium” (meaning “judgment”).  So the latin translation of prejudice is “praejudicium”.  Prejudice means pre-judgment.  Racial prejudice is a hot topic in America today.  There is a widespread and well publicized belief that law enforcement officials in America are prone to prejudgment of black citizens.  The recent events in Ferguson, Missouri included a claim that a young black man was singled out unfairly and was essentially murdered by a peace officer because of the color of his skin.  Ironically, the white peace officer who shot this black citizen was pre-judged by many, before an investigation was completed, of being guilty of this crime based upon the color of his skin.  Racism is essentially the act of prejudgment, classification and treatment of an individual based upon race.  Prejudice is usually, if not always, a two-way street.  You are different from me so I make assumptions about you when I make decisions and I am different from you so you make assumptions about me when you make decisions.

Arguably, prejudgment is an important defensive survival strategy that is ingrained in the human psyche.  In order to protect ourselves we make judgments about others so that we can decide how to approach other citizens or whether or not to approach others at all.  We develop trust for those we are familiar with and believe we know regardless of their physical characteristics.  If we are honest with ourselves we must admit that we all pre-judge people every day based upon their physical appearance and actions.

But prejudgment or classification and treatment of other citizens based upon distinguishing characteristics other than race is commonplace in America, as well.  If a woman was walking to her car  in the airport parking lot late at night and she found that a shaved headed man covered with tattoos and with a ring in his nose was walking in her direction from behind, would she make a judgment that she was likely in danger or at risk; and would that judgment be different if the man was in a suit and clean-shaven with no jewelry or tattoos?  Christians pre-judge Jews and Muslims and Jews pre judge Christians,etc. What about our judgment and treatment of a person when we learn their political party membership or political views?

The word politic is from the latin word “politicus” (meaning “concerning civil administration”).  The greek word “polis” means “city”.  The word “political” means about or concerned with politics.  In America there are two dominant political parties that each set forth a platform of prescribed policies for civil administration.  Political prejudice in America is, as a practical matter, the prejudgment, classification and treatment of a citizen based upon their political views and/or party membership.

If we are a self-proclaimed “liberal Democrat” and we learn another is a self-proclaimed “conservative Republican” do we draw immediate conclusions about that person (rich, greedy, selfish, uneducated, brainwashed, exploitive, inflexible, blindly patriotic, war mongers who do not respect life,  born again Christian, uncaring, unhappy.)  If we are a self-proclaimed “conservative” and we learn another is a “liberal” do we draw immediate conclusions about that person (lazy, believe in punishing success and rewarding failure, want to tax the rich to give handouts instead of offering a hand up, have low expectations for our citizens, see poor as less capable and want to make them subjects, do not consider the potentially devastating unintended consequences of well-intended policies, stupid, lazy, unpatriotic, envious, resentful, unhappy, do not love America, do not respect the constitution, do not value a life, no moral standards, socialists.)  I am certain someone is offended when reading those lists.  The lists of pre-judgment assumptions that can be made of one about the other could go on and on.

Would we be surprised  to learn that a self –proclaimed “conservative Republican” was middle class, well-educated, intelligent, caring, compassionate, philanthropic, in support of gay marriage and with no apparent selfish short-term economic incentive to vote for conservative Republican policy?  Would the woman in the airport parking lot be surprised and relieved to learn that the man with the shaved head, tattoos and nose ring walking behind a woman in an airport parking lot late at night was an activist musician returning from a peace rally?  Would we be surprised if a Democrat was a rich fiscal conservative in favor of a flat tax or of abolishing income taxes and in favor of smaller government but was a social liberal believing that morality should not be legislated?

I am a member of the Republican party.  I received an estimated 10 to 12 e-mails per day from Republican organizations that are for the sole purpose of fundraising.  Both my cell phone and work phone ring constantly from calls soliciting my financial support of Republican candidates and support of the party.  The main theme of the communications is that we need to defeat the opponent.  I am full of confident views about the best policies for leading our country but I have yet to be asked by Republican candidates or their agents for my concerns.  I finally received a call where the agent said that they were calling to hear from the voters but it was clear to me after setting forth a list of concerns about the Republican party platform, that the caller was not going to be recording or communicating my concerns to anyone; the call was exclusively intended to secure financial support.  The development of political platform and policy is not done from the bottom up.  Identification of issues and policy is, clearly, developed from the top down and this is true for both the Republicans and Democrats.  The party leadership sets the platform and the policy positions on all issues are bundled so that it is one stop shopping for the voters.  This top down approach by party leadership, I believe, causes voters to feel they have to go all-in with one party or the other because the platform is dictated to them and they are not heard about possible differences they have on some of the issues.  With the top down approach by each political party in setting policy positions, there is no chance to identify with some of the policies of each.  It is all or nothing.  You have to choose!

I would categorize myself as fiscal conservative.  I believe that government is well past being too large and I believe that “caring for its people” by confiscation and re-allocation of income and property is not the proper role of government.  It may be the best for our long-term survival that community members, of their free choice,   allocate their property toward the care of others in their community but it is not, in my opinion, the proper role of government to enforce such allocation especially when they are empowered by votes from those who would benefit from this confiscation and re-allocation.  I believe the liberal Democrats in Washington throw resources (other people’s money) at issues aimed at keeping their (false and unsustainable) promises and that the unintended consequences of this practice creates even greater problems (which they artfully blame on the Republicans!)  I believe that the invisible hand of the free market, despite its imperfections, is the best guide for resource allocation.  You may disagree with me but will we fail to reach some common ground and to challenge each other’s thinking just because we have chosen one party over another?

At this point in reading this article and learning about my views, it is my experience that, many liberals will likely begin to classify me “a certain way” and would likely stop listening.  Yet, I would classify myself as a social liberal as I believe, like many liberals,  that we should not legislate morality and that citizens should be free to choose social behaviors as long as they do not tread on other citizens.  I believe social issues should be governed by grass-roots community organizations and family units in our society and that the government should be out of peoples bedrooms as well as out of the board rooms.  I support recognition of same-sex unions (call it marriage or call it domestic partnership, I do not care) and, while I am not a fan of abortion, I support an individual woman’s right to choose in early term.  I vote Republican because I believe that economic freedom is the most important priority and a necessity to sustain a free society.  Interestingly,  if I began talking about my views on social freedoms before my views on economic freedom, many conservatives would have likely assumed I was a liberal democrat and would classify me a certain way and stop listening.

Many Republicans and Democrats can find common ground but we have evidently become more polarized in an “all or nothing” support of our party of choice.  The Pew Research Center conducted the largest political survey in it’s history – a poll of more than 10,000 adults between January and March of 2014.  The survey revealed 7 key findings:

  1. The share of Americans who express consistently conservative or consistently liberal opinions has doubled over the past two decades.
  2. Partisan antipathy has risen: The share of Republicans who have very unfavorable opinions of the Democratic Party has jumped from 17% to 43% in the last 20 years. Similarly the share of Democrats with very negative opinions of the Republican party has more than doubled from 16% to 38%. But the majority of both Democrats and Republicans say the policies of the other party represent a threat to the nation’s well-being.
  3. About six in ten (63%) of consistent view conservatives and 49% of consistent view liberals say most of their close friends share their political views.
  4. 75% of the consistent conservatives say they would opt to live where houses are larger and further apart, but schools, stores and restaurants are several miles away, while 77% of consistent liberals prefer smaller houses closer to amenities.
  5. Only 39% of Americans take a roughly equal number of liberal and conservative positions, down from 49% from surveys conducted in 1994 and 2004.
  6. Voter rates are higher on the right than the left but voter rates are higher on the left than the middle. Political donation rates are roughly double the national average for the consistent view liberals (31%) and for the consistent view conservatives (26%) compared to all liberals and all conservatives, respectively.
  7. Six in ten liberals say the optimal deal between President Obama and the GOP should be closer to what the President wants while 57% of conservatives say an agreement should be more on the GOP terms.

The Pew Research Center survey results suggest that there is growing polarization and animosity along across party lines and that we are more polarized in our views.

I think it is a sort of duty for all of us to try to avoid prejudice or pre-judgment of others, even when it comes to our political beliefs and affiliations.  If we congregate only with those that think like us and avoid the challenge of discussion, we will lose a chance to grow and evolve as a society.  Jonathan Haidt has written the book:  The Righteous Mind, Why Good People are Divided in Religion and Politics, and I believe the findings are important for us all to understand.  There are reasonable foundations in the decision processes of both liberals and conservatives.  While I understand it is human nature to prejudge others to make efficient decisions about allocation of our time or regarding safe passage through life, if we are too insulated (as in a plastic bubble) we will fail to experience different perspectives and will become myopic and will lack the ability to adapt and to will not be able to sustain the way of life we love for future generations.

We gather in groups to form a majority and to strengthen our filter of political correctness and when one stretches to listen to the other side, we consider casting them from the fold with disdain and disgust at their willingness to consider a view contrary to the rigid platform the collectively hold so dear.  Tocqueville saw the tyrannous effect that public opinion and the power of the majority force to gain a tyrannous hold on the minds of its subjects:

In America the majority raises formidable barriers around the liberty of opinion; within these barriers an author may write what he pleases, but woe to him if he goes beyond them. Not that he is in danger of an auto-da-f‚, but he is exposed to continued obloquy and persecution. His political career is closed forever, since he has offended the only authority that is able to open it. Every sort of compensation, even that of celebrity, is refused to him. Before making public his opinions he thought he had sympathizers; now it seems to him that he has none any more since he has revealed himself to everyone; then those who blame him criticize loudly and those who think as he does keep quiet and move away without courage. He yields at length, overcome by the daily effort which he has to make, and subsides into silence, as if he felt remorse for having spoken the truth. 

Tocqueville Warning Regarding Republican Democracy and the Tyranny of the Majority.

 

 

Coercion and Confiscation are not Elements of Leadership in a Free Society

In a free society, you make the choices about your life.  In a politically dominated society, someone else makes the choices.  And because people naturally resist letting others make important choices for them, political society is, of necessity, based upon coercion.  From “The Libertarian Mind” by David Boaz

If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion.  Friedrich August von Hayek

When an individual uses physical threat, financial threat, political force, trickery, salesmanship (offering a promise of value in exchange for cooperation) in order to cause other individuals to a particular action, can we call that leadership?  We can say that leadership is the act of inspiring people toward some end or goal.  In a free society, however, any coercive methods would not be an acceptable form of leadership.  Would they?

Many think of someone who vocalizes ideas as a leader, of sorts.  We, however, have heard the reference to a “silent leader”.  We have heard of the reference “lead by example.”  Interestingly a follower can also be a leader in that a respected person may demonstrate to others his desire to follow someone else’s instruction or idea, thus leading those others down the same path.  Leadership can be passive (the followers may not even realize they are being led) and can be active (the person attempting to lead is explicit in articulating his desire for others to act).

I have used the reference of “leader” when referring to the president and members of congress.   If one gains a source of power to control the behavior of other people, is that a form of leadership or is it just coercion?  If that power comes from the vote of the people you control so that you can move “the people” toward  a goal you believe is appropriate, is that reasonably characterized as leadership in a free society.  What about those among “the people” that did not vote for you?  Are they following you by choice or are they coerced?  And if they are coerced and are forced to comply with threat of imprisonment, can the redistribution be the characterized as the result of leadership in a free society?

What if we were to say that our freedom has limitations such that we are free to chose to do whatever we want as long as we do not harm another or infringe upon the ability of another to pursue their own happiness?  That is different than saying others have the right to take the fruit of your efforts in their quest for happiness and in the name of “fairness.”  “Vote for me and put me in a position of power, and I will force others who have gained more than you in their pursuit of happiness, to give you their property, even at their objection.”  Confiscation of property does not lead a person to, of their own free will, give to the cause of another.  Whether armed with votes or armed with guns, confiscation of the property of another against their will is a coercive act and it is difficult to characterize that act as leading people to help others.   We do have examples of people giving their property to the cause of others of their own free will in our society.  Giving by free will and choice is a common and well documented practice among our country’s most wealthy individuals and yet we subscribe, at the price of our own voice (votes), to confiscation from “the wealthy” and allow ourselves to be wards of the confiscators.

The practice of securing power through promise of the confiscation and redistribution of property from one citizen to another in exchange for votes is not a form of inspirational leadership in a free society, it is a form of bribery.  The fact that it is done on a large scale somehow causes us not to take notice.  Imagine if you received a call from a candidate for president of the United States indicating that, if you vote for him, he will distribute enough money for you to make your car payment and that the funds will come from your neighbor who has a nicer car?

 “The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”
Alexis de Tocqueville 

Modern Politics and the The American Value of Freedom

In a free society, you make the choices about your life.  In a politically dominated society, someone else makes the choices.  And because people naturally resist letting others make important choices for them, political society is, of necessity, based upon coercion.  From “The Libertarian Mind” by David Boaz

In our modern political canvas, we place everyone in one of two categories left (liberal) and right (conservative).  There is a platform for each and we must choose one or the other for practical relevance.  There are two dominant parties with the Democratic party representing everyone from overlapping center to left and the Republican party representing everyone from overlapping center to right.  Many feel that the party platform of each has become more polarized left (Democrats) and more polarized right (Republicans.)  I believe the most significant foundational value of the American Experiment is Freedom.  Which of the two dominant parties is the strongest proponent of Freedom?

The Republicans seem to be the biggest proponents of economic freedom while the Democrats seem to be the biggest proponents of personal freedom.  What party do you join or support if upholding Freedom is the most important to you as a voter?  I have met many hardened Democrats that seem to me to be fiscally conservative and socially liberal and  I meet many Republicans that seem to be socially liberal and fiscally conservative.  What I tend to find is that the choice of party for each is based upon which of the two (personal or economic freedom) that they feel is most important.  I happen to be a staunch fiscal conservative and in support of economic freedom (low taxes, smaller government and a limited amount of Federal laws regulating economic activities) and yet I also am a social liberal in that I believe that we should not legislate morality and that personal behavior should be of personal choice and governed by grass roots family and community organization but because I believe Economic Freedom is the most critical of the two, I default to vote Republican.  I know many Democrats that weight the need for social (individual) freedom above the need for economic freedom and they default to vote Democrat.

Ultimately, each law passed is a restriction on the people’s freedom to act and choose as they please.  There are easily more laws restricting and governing an individual person than any person can keep track of and explicitly follow.  Is one of the two dominant political parties a protector of Freedom?  I do not see it.  Both parties fancy the title of “law maker” for its representatives.  If you are making more laws you are restricting freedom.  What if I do not want more laws?  What if I want many laws actually repealed and what if I want the government to be substantially smaller?  Conventional wisdom says that I should vote Republican but I am beginning to question that wisdom.  Republicans seem to give the goal of smaller government and less intrusion in our personal lives lip service but I do not have confidence that the GOP actions will match the GOP words.  Ronald Regan was raised an Irish Catholic Democrat and he said, “I did not leave the Democratic Party, the party left me.”  I feel that way about my GOP.  But I do not find safe harbor with the Democratic Party, in fact I still find it the lesser of the two evils.

While our society remains generally based upon equal rights and markets, every day new exceptions to those principles is carved out in Washington and in Albany, Sacramento and Austin (not to mention Brussels, Beijing, and elsewhere).  Each new government directive takes a little bit of our freedom, and we should think carefully before we give up any liberty……A Liberal Society is resilient; it can withstand many burdens and continue to flourish; but it is not infinitely resilient.  Those who claim to believe in liberal principles but advocate more and more confiscation of the wealth created by productive people, more and more restrictions on voluntary interaction, more and more exceptions to property rights and the rule of law, more and more transfer of power from society to state, are unwittingly engaged in the ultimate deadly undermining of civilization.  From “The Libertarian Mind” by David Boaz

If Liberty is the main component of America’s foundational beliefs, we are in the process of removing one pillar at a time from our foundation and using it to increase the mass and weight of the structure on top.  Eventually the structure will collapse.  Human nature causes us to value scarce resources over abundant resources.  We take Freedom for granted and value it less than our concern for “fairness” and our recently new identification of equality as meaning “equal results”.  We are not aware that each step we take toward trying to make things “fair” and “equal” is a step away from freedom.

Self-Ownership or a Subject, Which do You Choose?

“Society will develop a new kind of servitude which covers the surface of society with a network of complicated rules, through which the most original minds and the most energetic characters cannot penetrate.  It does not tyrannise but it compresses, enervates, extinguishes and stupefies a people, till each nation is reduced to nothing better than a flock of timid and industrious animals, of which the government is the shepherd.”   Tocqueville

Every person is a unique individual and I believe our propensity or nature is to think and act individually. Yet the complexity of our society and the sheer volume of rules and considerations causes us to shun discussion and debate in exercise of individual ideas and thought in favor of relinquishment of our individuality. We surrender to a keeper and are forced to follow one of two platforms built by our appointed keeper. Membership in one means we are enemies of the other.

We call our keepers law makers. We haver surrendered our individuality to those who would produce more and more rules and more and more complexity so that we are more at sea and in need of them to take guide of our individual vessel. Ask yourself how many laws at the federal, state and local government levels that you as an individual are subject to? The answer is more than you can count and keep track of. Do you adhere to these laws because you study them to make sure you are fully aware as you conduct your business of life? Of course not. You adhere to the morass of detailed rules and laws because you follow basic rules of behavior. And yet the administrative cost to society of making, administering and enforcing the detailed morass of laws is a devastating overhead burden that continues to grow. Maybe the role of our keepers should be to begin to thin down our system of rules and laws and to think of themselves as law keepers instead of law makers? Do we really need one more law?

David Boaz, in his book, The Libertarian Mind, talks about the other possibilities as an alternative to self ownership or individual sovereignty:

1. Somone—-a king or a master race—-could own others. Plato and Aristotle did argue that there were different kinds of humans, some more competent than others and this endowed with the right and responsibility to rule, just as adults guide children. Some forms of socialism and collectivism are, explicitly or implicitly, based on the notion that many people are not competent to make decisions about their own lives, so that more talented should make decisions for them. But that would mean there would be no universal human rights, only rights that some have and others do not, denying the essential humanity of those who are deemed to be owned.

2. Everyone owns everyone, a full-fledged communist system. In such a system, before anyone could take an action,he would need to get permission from everyone else. But how could each other person grant permission without first consulting everyone else? You would have an infinite regress, making any action at all logically impossible. In practice, since such mutual ownership is impossible, this system would break down into the previous one: Someone or some group would own everyone else. That is what happened in the communist states: The party became a dictatorial ruling elite.

Make no mistake, your keeper wants your money and support, your vote. Your keeper does not want to ask you how you want to be kept but will tell you how you should live and be kept. Because your keeper, by your own surrender, is your superior and knows what is best for you. You gladly surrender because you can avoid the challenge of considering and understanding the complexity created by your captor and because you are promised that you will be taken care of and will be equal to your piers despite your differences.

The American Republic will endure until the day Congress discovers it can bribe the public with the public’s money. Tocqueville

Americans are so enamored of equality, they would rather be equal in slavery than unequal in freedom. Tocqueville

A Suggested Reading List – Man: Where do We come From and Where are We Going

We see evidence of chaos in nature as well as amazing order and balance.  Humans are constantly striving to conquer nature so that the inconvenience of struggle is, ideally and ultimately, eliminated.  We seem to now operate under the premise that no man should have to struggle and that we can govern struggle out of our existence regardless of the cost.  But, if you believe man has evolved and changed, what would that process of evolution lead to if we eliminated struggle from our lives?  With millions of years of human experiment, there is a wealth of data regarding the success and failures of man in his attempt to conquer the forces of nature. We have a long record of social experiment that include successes and failures. What can we learn from history? 

How is it that a new-born eventually comes to understand the wisdom of millions of years of human trial and error when the average life lasts less than 100 years?  Joseph Campbell studied the recurring themes in the fables and mythical stories of man across different cultures of the world that aim to teach the findings of the generations to instruct us “how to live”?  I think Campbell’s work is important and instructive and if a person wanted to consume one book by Campbell, I recommend The Power of Myth by Joseph Campbell with Bill Moyers.

The aboriginal culture was the longest living, purely intact culture on the planet, what did they owe to that longevity.  Can we learn something from how they lived.  The primary foundation of their culture was a life lived in harmony and balance with the plants and animals with which they were dependent.  Mutant Message from Down Under by Marlo Morgan is a wonderful story illustrating the Aboriginal view of how to live sustainably in concert with the laws of nature.  One of the key elements lacking in the economy of the aboriginal was agriculture as we know it.  The aboriginal did not practice animal husbandry, did not herd animals to store food. We might judge the aboriginal society as unsophisticated and yet they survived as an intact culture for longer than any on the planet. Instead of trying to rise above nature and struggle, the aboriginal people of the Australian Outback wanted to live in balance with nature and embrace struggle as a part of live.

A look back at the history of man on our planet indicates that man’s shift from hunters and gatherers to an agrarian society with storage of surplus food was one of the most profound shift’s and changes in history and has had a profound impact on our planet.  Ishmael: An Adventure of the Mind and Spirit, by Daniel Quinn (as well as his book My Ishmael) is a thought-provoking story causing one to consider the past and the path of man and his relationship with nature. In the book, Ishmael says: There’s nothing fundamentally wrong with people. Given a story to enact that puts them in accord with the world, they will live in accord with the world. But given a story to enact that puts them at odds with the world, as yours does, they will live at odds with the world. Given a story to enact in which they are the lords of the world, they will act as the lords of the world. And, given a story to enact in which the world is a foe to be conquered, they will conquer it like a foe, and one day, inevitably, their foe will lie bleeding to death at their feet, as the world is now.  Guns, Germs and Steel:  The Fates of Human Societies by Jared Diamond chronicles, in this non-fictional work, the rise and destruction of human civilizations in the history of man and the role of agrarian technology and food surplus in promoting population growth, dominance and superiority in civilizations.

The Journey of Man, A Genetic Odyssey by Spencer Wells describes the use of modern science to track the genetic mutations of humans back to his origin through the mail Y chromosome. The finding is that all people can be traced back to a tribe in Africa that lived 60 million years ago. The incredible undertaking shows how all humans are related and how we adapted and changed in different environments. The level of radiation or the predominant diet in a region, for example, would impact our need to absorb sunlight to produce vitamin D and therefore impact the shade of our skin. Does the thought that we all have the same origin change our acceptance and understanding of one another?

Democracy in America by Alexis de Tocqueville is a critique of the American experiment by a Frenchman who was originally chartered to travel to America to evaluate the criminal justice system. Tocqueville is able to identify the practical limitations and potential failings of a democratic system of self governance. This is a brilliant and insightful treatise that produced the famous reference: “tyranny of the majority.” These writings are potent and relevant even though they were written well over 100 years ago. I think every American would benefit from the incredible insights and predictive qualities of Tocqueville in Democracy in America.

Jonathon Haidt, a social psychologist, popularized moral foundations theory in his book The Righteous Mind: Why Good People are Divided By Politics and Religion. Intelligent and caring people can end up voting to support either liberal or conservative agendas. The one side assumes that the other side is either stupid, brainwashed, greedy or evil. But Moral foundations theory and the study of how differences in moral reasoning can produce different decision criteria, offers a possible explanation of how to good, intelligent and caring people can reach a completely different conclusion. Moral foundations theory offers six moral foundations or imperatives (with opposing factors listed for each) at work in moral reasoning: Care/Harm, Fairness/Cheating, Liberty/Oppression, Loyalty/Betrayal, Authority/Subversion, Sanctity/Degradation. Haidt, with political origins and leanings as a liberal Democrat, studied the difference in the moral reasoning exercises of liberals and conservatives and compared those. What he found was that liberals consistently stress three of the six (harm, fairness and liberty, in that order) while conservatives stress all six foundations more equally. Haidt and other moral psychologists believe that the moral foundations are a decision criteria that stem from the process of human evolution as a response to adaptive challenges. It is not difficult to imagine why all six moral imperatives might be important considerations for group survival. The valuable insight from this work, in my opinion, is the development (mostly by liberals in my opinion) of the realization that there are justifiable reasons, rooted in the evolutionary development of man in a social setting, why conservative values (driven by the other three moral foundations) exist and why good and caring people can reach a different conclusion. When we consider the work of Jonathan Haidt we have to consider that although good and caring people can reach polar opposite conclusions, the opposite conclusions about how man should live and role of government in society will likely produce entirely different results.

Atlas Shrugged by Ayn Rand, is a novel that imagines a world where the moral foundation of care is dominant to the detriment and even exclusion of decisions based upon the criteria of liberty, loyalty, authority and sanctity. In Atlas Shrugged, the productive citizens are shrinking in number while the dependent population is growing in number with the moral imperative or care calling the productive into servitude of the “moochers”. The consequence in Atlas Shrugged is the disappearance and unavailability of the productive and resourceful citizens and the implosion of society. I believe every citizen could benefit from reading the novel Atlas Shrugged. The novel allows for image of a society where dependency and self-responsibility take a back seat to entitlement. The novel warns us that decisions, while well intended are not immune to the law of unintended consequences when decisions are void of consideration of certain moral foundations that are a product of evolution based upon adaptive social norms in response to survival challenges. Unfortunately, Atlas Shrugged is extremely lengthy and is a significant undertaking for any reader. I believe it is an incredibly important work and, while I understand the reluctance of a good liberal to partake I would suggest that your conviction of belief will either be shaken or firmed from the challenge.

America Alone: The End of the World as We Know It, by Mark Steyn causes us to consider demographic shifts and the impact of increasing death rates coupled with decreasing birth rates in some countries and the threat of the opposite trend in other countries to the balance of power and our way of life. If the message in this book is considered with the history set forth in Guns, Germs and Steel it is not impossible to imagine that changing world population could lead to a shift in power and imposition of a new, undesirable, way of life could result. Mark Steyn has a brilliant and engaging writing style that will not disappoint.

I can only hope that my children read all items from my reading list above and will be encouraged to read from other people’s lists. In this way they will expand and challenge their thinking so that they can be responsible decision makers through an understanding of where we (humans) come, where we are headed and the possibilities for a change.

The Path to Peace

My mother, Linda, was the oldest of 7 children. She was raised in a small town in the Midwest. She attended a catholic grade school (I recall her talking about a strict nun.) Many people have told me that she was the most beautiful girl ever to come from McCook, Nebraska. Linda appreciated compliments but at the same time she was uncomfortable with the notion that she was beautiful and never quite accepted or entirely believed that this was the case. Linda attended junior college and worked as a receptionist and bookkeeper and was not a particularly sophisticated person. She was not versed in the matters of Washington or Wall Street. Linda was a compassionate and loyal person with a devotional love for her family and for the extended family of people in the circle of her life.
My mother went through a very tough divorce. Linda raised three boys on her own on a receptionist salary and enlisting help from her parents before she remarried a man who would provide for her and her boys and give her a complete family. She suffered two brain aneurysms in her life, one in her thirties and one in her fifties (almost exactly 20 years apart.) Although she had some imperceptible issues from the brain aneurysms, she was fortunate to recover remarkably well. Her family all reasoned that she had her full share of health issues and that she would now live a long life (her grandmother and mother both lived well into their 90’s.) However in 2006, Linda was diagnosed with glioblastoma (an insidious and incurable brain cancer) and she died in October of 2008 the age of 68.
I sat with her one night next to her bed while she was in a rehabilitative care facility after they attempted to remove the cancer from her brain surgically and held her hand while we watched a crime drama on TV. At one point she pulled her hand away and rubbed the incision on her head and said, “I had another one of those things.” I said, do you mean an aneurysm.” She said, “yes, one of those.” I said, “no Mom, you have a terminal form of brain cancer.” She asked some questions and then stared at the TV. I began to cry and then squeezed her hand and said, “Mom, I am so sorry.” She squeezed my hand and turned to me and looked me square in the eyes. In an effort to comfort me she said, “babe, no one ever said life was going to be easy.” And then she smiled at me as if to say that she was fine and went back to watching the TV and continued to stroke my hand. She was intent on comforting me at that moment.
My Mother said things to me like: “no one said life was going to be easy” as I was growing up. She used to tell me to make sure that I gave more to the world than I took because, “the only way for the world to keep spinning is for people to give more than they take.” When I was in college and having the normal struggles that a young person trying to find their way has, my mother sent me the serenity prayer. I will not recite the prayer here but it is about acceptance and self-responsibility. Many would have thought of my mother as less than a formidable person. Now that she is gone, I realize that she was the strongest of us all and she had “the secret sauce.”
I am not certain that people can find true serenity until they find self-responsibility and self-reliance. Certainly freedom is an important element of serenity. Maybe a person can find peace in captivity but that is not the kind of peace and serenity that I desire. My mother would provide love and comfort but the greatest gift she gave me was the ability to love, accept and comfort myself despite my imperfections and mistakes. My mother taught me that I am responsible for my own happiness and that the key to my happiness was inside me. She taught to be happy with more or less and to be grateful for what God gave me, for better or for worse. Linda gave me a measuring stick to evaluate my life that did not lead me to envy others or to expect others to make me happy. I think my mother gave me the means of being free even if I were physically held captive.
While my mother would comfort me in a time of need, she would at the same time challenge me to find comfort in the simple things and to appreciate the opportunity before me. That was incredibly empowering. She was a true leader and motivator in that respect. She gave me an endless internal flame of independence and freedom.
Amazingly, I hear leaders today talking about income inequality and promoting envy and dependence. I do not hear leaders teaching people to love themselves for other than their income or possessions or providing a way for people to measure their value or chance for happiness in other than dollars. I do not hear our leaders challenging citizens to give more than they take to help keep the world spinning. I do not hear leaders describe a path to self-reliance and serenity. Someone will always have more and some will have less in a free society. I hear our leaders encouraging comparison to our neighbors who have more measured by income and possessions. This comparison can only promote envy and anger. Dependency is another form of captivity that is more powerful than physical captivity because it imprisons the soul and isolates the soul from what it truly needs. What the soul thirst for is self-acceptance and an internal strength and flame that allows us to love and accept ourselves regardless of the station of our neighbor, for better or worse.

Income Differential in the NBA

In December of 2013, President Obama spoke to the nation and indicated that the dream of economic mobility is breaking down and the growing income gap is a “defining challenge of our time.” The President vowed to focus the last three years of his presidency addressing the discrepancy and a rapidly growing deficit of opportunity that he said is a bigger threat than the fiscal deficit. President Obama said increasing income inequality is more pronounced in the United States than other countries and that Americans should be offended that a child born into poverty has such a hard time escaping it. He said “it should compel us to action. We’re a better country than this.”

It has been more than 9 months since President Obama made these statements and made his vow. It sounds to me like a very important issue. President Obama did not and has not, to my knowledge, provided more clarity regarding his this issue and his vow. What exactly is the objective as it relates to income inequality and disparity in incomes? I can only assume that President Obama is indicating that in America (and around the world), fewer and fewer people earn more and more and more people earn less. Is he indicating that the goal of his focus is for every person to earn the same, ultimately? He did not indicate if some level of discrepancy is acceptable? What about accounting for differences in behavior and capability when we look at differences? Are differences in inputs important in the analysis of differences in outcomes? This issue of income inequality usually includes a citation of the distribution of incomes in the broadest definitional sense but it rarely accounts for or references the differences in inputs (hours worked, education, ingenuity, research, capital investment, risk taking, luck, etc.) that can influence differences in income levels.

With most objectives, we have to define the issue and define the goals. With any process, we have to start somewhere. The United States is a big country and people in our country face many differences. I decided to focus on one income earning segment of our economy to highlight some real questions and issues that arise when we seek clarity regarding this issue of differences in incomes. It is clear to me that one of the best representative sectors of our economy, with respect to income differential, is professional basketball in the United States. More specifically the National Basketball Association (including it’s main major league and it’s developmental league.) Since President Obama points to broad income distribution statistics, without differentiating, we can assume that the income differences in the NBA (and other professional sports) are impacting, to some degree, the overall income differential in our country which referred to by President Obama when he identifies the issue.

The maximum salary for a D-League NBA player is under $30,000 with daily per diem and living expenses paid in addition. NBA players who are under contract and on the rosters of teams in the major league also receive a per diem pay but the average salary in the NBA (excluding the D league) for the 2014-15 season is $4,935,593. The top NBA Salary for the 2014-15 season is $23,500,000 for Kobe Bryant. The maximum NBA development league player salary is just more than ½ of 1% of the average NBA salary. The maximum NBA development league player salary is just 12.8% of 1% (.128%) the top NBA salary. The top 30 (7.73%) NBA players earn $528.46 million or 27.6% of the total NBA wages. The bottom 100 (25.8% ) of NBA players earn $100.32 million or 5.24% of the total NBA wages. Clearly the income distribution statistics for the NBA indicate that there is a major discrepancy and that there is a significant income gap (and that is just when considering NBA employees that are players.) If we were to look at professional basketball compensation including the concession employees, marketing staff, janitorial and facilities maintenance staff, etc., we would likely identify an even bigger discrepancy or gap in incomes. According to President Obama, this is an issue that needs to be addressed in a broad sense, so why not start with professional sports like the NBA. Next we can look at the film industry and the discrepancy between the average annual salary of Tom Hanks and the ticket taker or popcorn popper behind the concession counter.

Is it fair that Kobe Bryant earns 695.61 times what the maximum player in the NBA development league makes? Is there a plausible explanation or is there a defensible reason for this difference? When income gap statistics are quoted there is no qualification or differentiation so the inference is that all people are comparable and that the differences are a problem. What about the unemployed basketball players that aspire to be NBA players? Should we include the unemployed NBA players in this analysis? Are there differences between Kobe Bryant and the maximum salaried developmental league player that would cause us to account for the differences as actual being fair or justified. If the answer is yes, meaning that there are reasons for the differences that justify the differences, then is it possible that much of the differences in earnings of all American’s is explainable and justifiable? How do we know if we really have differences in incomes for all people that are not accounted for as due to differences in efforts, differences in risks taken, differences of investment of time or capital, differences in talent or differences in ingenuity?

President Obama does not begin to address all of the potentially valid and acceptable reasons why people may have different incomes. I would start by pointing out to President Obama the substantial differences for professional basketball players, professional athletes, professional sports employees, movie industry actors and other movie industry workers and ask him to tell us what he would propose to do to promote a shrinking of that discrepancy or gap so that earnings are more evenly distributed? I would ask him if he believes that the average developmental player deserves to make the same amount as Kobe Bryant. I would ask him if the ticket taker deserves to make the same as Tom Hanks? If his answer is no, then he has to admit that there may be a plausible and acceptable reason for vast disparity or discrepancy in incomes and that consequently we need to accept, in a free society, different results.

The compensation distribution in professional sports and the movie industry, especially if you consider all employees in professional sports and the movie industry, is substantially skewed. If we were to look at this issue across our nation segment by segment (or even door to door), would we be able to show the American people that differences in incomes are simply a byproduct of differences in people in a free society? Would we show the American people that differences in choices, differences in risk acceptance, differences in effort, differences in ability, differences in behaviors, differences in supply and demand for individual skills and abilities, differences in willingness to save and be thrifty, differences in investment of amount of time or capital, and other differences among many more are responsible for income differences? Would we show the American people that accepting freedom of choice for American’s is not exclusive of the requirement to accept different outcomes and different rewards?

Why Centralized Government Welfare is Intrusive on our Freedom and Destructive of Community Coheshion.

If we go back in our countries history to the beginning, just after the ink on the US Constitution was dry, the role of the federal government was not to be a caretaker of it’s people. In fact, the opposite was true: the government only existed and was sustainable based upon the care of the people (“We the people…”)

The altruistic role of the local community is subverted by the liberal agenda to define the role of centralized government as that of a caretaker of the masses. Ultimately, in the role of the caretaker of the people, the federal government steals the opportunity for individuals in a local community to congregate and cooperate among themselves to solve social problems. This federal government welfare agenda eliminates the binding of the community toward a cause of social welfare that is tailored to the needs of a particular community. The centralized welfare programs must assume that all people in need in every community have similar needs and that they are all worthy of assistance regardless of their personal choices or behavior. Local programs at the grass roots level allow for discrimination so that people are free to give their time and resources to others that they feel are deserving. This key element of local grass roots giving allows for the local communities to avoid enabling bad behavior. A community (and certainly the federal government) cannot sustain a program of care for a growing population of unproductive dependents who take more than they contribute to the collective. The result is, for productive people, to have their property taken at threat of guns and imprisonment, and to have that property given to some (and a growing number) of people in their communities who demonstrate selfish, unproductive, and community damaging behavior. This removes the chance of the citizens to care for those fellow citizens in need who are honorable and responsible to the community. In other words, our allowance of the liberal agenda to define the federal government as a caretaker of it’s people has depersonalized our society and has limited the ability of people to voluntarily take care of it’s people.

The weapon of the liberal agenda is to demonize any who would not support the re-allocation of resources from local communities to allow the central government the power to address the apparent ills of society. The administrative cost of sending hard earned resources (not to mention that they are resources taken from private citizens) to Washington to be re-distributed back into the local community is high. What the liberal leaders have done is hijacked the purpose and role of local grass roots cohesive community involvement in favor of the impersonal and disconnected centralized social welfare function. The consequence is limitation of the cohesive quality of community cooperation and the elimination of positive local discriminatory practices.

While I am sure there are those who could write a paper on the current state of organized Judeo-Christian religion and it’s failure, in most every denomination, to maintain and grow participation, one of the major external causes of this trend is the growing role of the federal government as the caretaker and social net for people in local communities. There are other groups in communities besides those that meet in churches and synagogues, that are also finding it difficult to recruit young people. Membership in local grass-roots community organizations aimed at addressing local social issues is diminished as more and more feel they do their part by paying their taxes and expect the central government to take care of these issues.

So we move toward a new paradigm where it is no longer the expectation that mature and citizens will take care of themselves. Instead we find that more and more want to look away from self responsibility and the discriminating requirements of neighbors and to look to a central figure who draws it’s power from the vote of the growing mass of immature and dependent citizens. The central figure draws support with the promise that he will coerce others into caring for any who chose something less than self responsibility. These individuals surrender their proxy, dignity and self respect to a captor disguised as a savior.

The economically viable citizen in the America of the modern liberal must, on the penalty of imprisonment, work several months of every year to care for persons he has never met and many of whom escape the moral responsibility of working for themselves and providing for their own material welfare (even though they are not occupationally disabled.) The foundations of social cooperation in communities across America are not understood by the modern liberal. The capacity for individual altruism by discrimination and choice manifested as charitable acts in a community are the foundation of sustainable systems of social cooperation. When this selective moral imperative of group survival is changed to be the product of a legally enforceable demand by the central government in exchange for votes and continued power, the foundation for the community social net is weakened and we are set on a destructive path.

“So you think …

“So you think that money is the root of all evil?” said Francisco d’Aconia. “Have you ever asked what is the root of money? Money is a tool of exchange, which can’t exist unless there are goods produced and men able to produce them. Money is the material shape of the principle that men who wish to deal with one another must deal by trade and give value for value. Money is not the tool of the moochers, who claim your product by tears, or of the looters, who take it from you by force. Money is made possible only by the men who produce. Is this what you consider evil?

“When you accept money in payment for your effort, you do so only on the conviction that you will exchange it for the product of the effort of others. It is not the moochers or the looters who give value to money. Not an ocean of tears nor all the guns in the world can transform those pieces of paper in your wallet into the bread you will need to survive tomorrow. Those pieces of paper, which should have been gold, are a token of honor – your claim upon the energy of the men who produce. Your wallet is your statement of hope that somewhere in the world around you there are men who will not default on that moral principle which is the root of money. Is this what you consider evil?

“Have you ever looked for the root of production? Take a look at an electric generator and dare tell yourself that it was created by the muscular effort of unthinking brutes. Try to grow a seed of wheat without the knowledge left to you by men who had to discover it for the first time. Try to obtain your food by means of nothing but physical motions – and you’ll learn that man’s mind is the root of all the goods produced and of all the wealth that has ever existed on earth.

“But you say that money is made by the strong at the expense of the weak? What strength do you mean? It is not the strength of guns or muscles. Wealth is the product of man’s capacity to think. Then is money made by the man who invents a motor at the expense of those who did not invent it? Is money made by the intelligent at the expense of the fools? By the able at the expense of the incompetent? By the ambitious at the expense of the lazy? Money is made – before it can be looted or mooched – made by the effort of every honest man, each to the extent of his ability. An honest man is one who knows that he can’t consume more than he has produced.

“To trade by means of money is the code of the men of good will. Money rests on the axiom that every man is the owner of his mind and his effort. Money allows no power to prescribe the value of your effort except by the voluntary choice of the man who is willing to trade you his effort in return. Money permits you to obtain for your goods and your labor that which they are worth to the men who buy them, but no more. Money permits no deals except those to mutual benefit by the unforced judgment of the traders. Money demands of you the recognition that men must work for their own benefit, not for their own injury, for their gain, not their loss – the recognition that they are not beasts of burden, born to carry the weight of your misery – that you must offer them values, not wounds – that the common bond among men is not the exchange of suffering, but the exchange of goods. Money demands that you sell, not your weakness to men’s stupidity, but your talent to their reason; it demands that you buy, not the shoddiest they offer, but the best your money can find. And when men live by trade – with reason, not force, as their final arbiter – it is the best product that wins, the best performance, then man of best judgment and highest ability – and the degree of a man’s productiveness is the degree of his reward. This is the code of existence whose tool and symbol is money. Is this what you consider evil?

“But money is only a tool. It will take you wherever you wish, but it will not replace you as the driver. It will give you the means for the satisfaction of your desires, but it will not provide you with desires. Money is the scourge of the men who attempt to reverse the law of causality – the men who seek to replace the mind by seizing the products of the mind.

“Money will not purchase happiness for the man who has no concept of what he wants; money will not give him a code of values, if he’s evaded the knowledge of what to value, and it will not provide him with a purpose, if he’s evaded the choice of what to seek. Money will not buy intelligence for the fool, or admiration for the coward, or respect for the incompetent. The man who attempts to purchase the brains of his superiors to serve him, with his money replacing his judgment, ends up by becoming the victim of his inferiors. The men of intelligence desert him, but the cheats and the frauds come flocking to him, drawn by a law which he has not discovered: that no man may be smaller than his money. Is this the reason why you call it evil?

“Only the man who does not need it, is fit to inherit wealth – the man who would make his own fortune no matter where he started. If an heir is equal to his money, it serves him; if not, it destroys him. But you look on and you cry that money corrupted him. Did it? Or did he corrupt his money? Do not envy a worthless heir; his wealth is not yours and you would have done no better with it. Do not think that it should have been distributed among you; loading the world with fifty parasites instead of one would not bring back the dead virtue which was the fortune. Money is a living power that dies without its root. Money will not serve that mind that cannot match it. Is this the reason why you call it evil?

“Money is your means of survival. The verdict which you pronounce upon the source of your livelihood is the verdict you pronounce upon your life. If the source is corrupt, you have damned your own existence. Did you get your money by fraud? By pandering to men’s vices or men’s stupidity? By catering to fools, in the hope of getting more than your ability deserves? By lowering your standards? By doing work you despise for purchasers you scorn? If so, then your money will not give you a moment’s or a penny’s worth of joy. Then all the things you buy will become, not a tribute to you, but a reproach; not an achievement, but a reminder of shame. Then you’ll scream that money is evil. Evil, because it would not pinch-hit for your self-respect? Evil, because it would not let you enjoy your depravity? Is this the root of your hatred of money?

“Money will always remain an effect and refuse to replace you as the cause. Money is the product of virtue, but it will not give you virtue and it will not redeem your vices. Money will not give you the unearned, neither in matter nor in spirit. Is this the root of your hatred of money?

“Or did you say it’s the love of money that’s the root of all evil? To love a thing is to know and love its nature. To love money is to know and love the fact that money is the creation of the best power within you, and your passkey to trade your effort for the effort of the best among men. It’s the person who would sell his soul for a nickel, who is the loudest in proclaiming his hatred of money – and he has good reason to hate it. The lovers of money are willing to work for it. They know they are able to deserve it.

“Let me give you a tip on a clue to men’s characters: the man who damns money has obtained it dishonorably; the man who respects it has earned it.

“Run for your life from any man who tells you that money is evil. That sentence is the leper’s bell of an approaching looter. So long as men live together on earth and need means to deal with one another – their only substitute, if they abandon money, is the muzzle of a gun.

“But money demands of you the highest virtues, if you wish to make it or to keep it. Men who have no courage, pride, or self-esteem, men who have no moral sense of their right to their money and are not willing to defend it as they defend their life, men who apologize for being rich – will not remain rich for long. They are the natural bait for the swarms of looters that stay under rocks for centuries, but come crawling out at the first smell of a man who begs to be forgiven for the guilt of owning wealth. They will hasten to relieve him of the guilt – and of his life, as he deserves.

“Then you will see the rise of the double standard – the men who live by force, yet count on those who live by trade to create the value of their looted money – the men who are the hitchhikers of virtue. In a moral society, these are the criminals, and the statutes are written to protect you against them. But when a society establishes criminals-by-right and looters-by-law – men who use force to seize the wealth of disarmed victims – then money becomes its creators’ avenger. Such looters believe it safe to rob defenseless men, once they’ve passed a law to disarm them. But their loot becomes the magnet for other looters, who get it from them as they got it. Then the race goes, not to the ablest at production, but to those most ruthless at brutality. When force is the standard, the murderer wins over the pickpocket. And then that society vanishes, in a spread of ruins and slaughter.

“Do you wish to know whether that day is coming? Watch money. Money is the barometer of a society’s virtue. When you see that trading is done, not by consent, but by compulsion – when you see that in order to produce, you need to obtain permission from men who produce nothing – when you see that money is flowing to those who deal, not in goods, but in favors – when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is doomed. Money is so noble a medium that it does not compete with guns and it does not make terms with brutality. It will not permit a country to survive as half-property, half-loot.

“Whenever destroyers appear among men, they start by destroying money, for money is men’s protection and the base of a moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it. Paper is a check drawn by legal looters upon an account which is not theirs: upon the virtue of the victims. Watch for the day when it becomes, marked: ‘Account overdrawn.’

“When you have made evil the means of survival, do not expect men to remain good. Do not expect them to stay moral and lose their lives for the purpose of becoming the fodder of the immoral. Do not expect them to produce, when production is punished and looting rewarded. Do not ask, ‘Who is destroying the world?’ You are.

“You stand in the midst of the greatest achievements of the greatest productive civilization and you wonder why it’s crumbling around you, while you’re damning its life-blood – money. You look upon money as the savages did before you, and you wonder why the jungle is creeping back to the edge of your cities. Throughout men’s history, money was always seized by looters of one brand or another, but whose method remained the same: to seize wealth by force and to keep the producers bound, demeaned, defamed, deprived of honor. That phrase about the evil of money, which you mouth with such righteous recklessness, comes from a time when wealth was produced by the labor of slaves – slaves who repeated the motions once discovered by somebody’s mind and left unimproved for centuries. So long as production was ruled by force, and wealth was obtained by conquest, there was little to conquer. Yet through all the centuries of stagnation and starvation, men exalted the looters, as aristocrats of the sword, as aristocrats of birth, as aristocrats of the bureau, and despised the producers, as slaves, as traders, as shopkeepers – as industrialists.

“To the glory of mankind, there was, for the first and only time in history, a country of money – and I have no higher, more reverent tribute to pay to America, for this means: a country of reason, justice, freedom, production, achievement. For the first time, man’s mind and money were set free, and there were no fortunes-by-conquest, but only fortunes-by-work, and instead of swordsmen and slaves, there appeared the real maker of wealth, the greatest worker, the highest type of human being – the self-made man – the American industrialist.

“If you ask me to name the proudest distinction of Americans, I would choose – because it contains all the others – the fact that they were the people who created the phrase ‘to make money’. No other language or nation had ever used these words before; men had always thought of wealth as a static quantity – to be seized, begged, inherited, shared, looted, or obtained as a favor. Americans were the first to understand that wealth has to be created. The words ‘to make money’ hold the essence of human morality.

“Yet these were the words for which Americans were denounced by the rotted cultures of the looters’ continents. Now the looters’ credo has brought you to regard your proudest achievements as a hallmark of shame, your prosperity as guilt, your greatest men, the industrialists, as blackguards, and your magnificent factories as the product and property of muscular labor, the labor of whip-driven slaves, like the pyramids of Egypt. The rotter who simpers that he sees no difference between the power of the dollar and the power of the whip, ought to learn the difference on his own hide – as, I think, he will.

“Until and unless you discover that money is the root of all good, you ask for your own destruction. When money ceases to be the tool by which men deal with one another, then men become the tools of men. Blood, whips and guns – or dollars. Take your choice – there is no other – and your time is running out.”

This is a quote from a character in the book Atlas Shrugged by Ayn Rand.  Money (currency) is essential to the flow of income.  Our president has lit the beacon with his statement that “income differential” is the defining issue of our time.  But do we really understand what gives money value?  How can someone who is truly unproductive even come to hold money for exchange without causing devaluation?  This may sound harsh but read the quote and tell me what you think.

Minimum Wage – Part I

by Brian Boone

Different businesses entail a different level of risk.  A restaurant, for example, may require the owner to fund and make tenant improvements, enter into a long-term lease agreement to secure the physical premises and commit the time and expense to hire and train a core staff; and these commitments are required before the first entrée is served.  A restaurant owner can vary staffing and food ordering somewhat according to the volume of patrons and related sales, but the rent, the payments on the tenant improvement loan, the insurance, the payroll cost (and required benefits) for the chef, dishwasher, hostess, bartender, and an estimated level of supply and food inventory to insure quality and service are all fixed and have to be exceeded by sales, at a minimum for the venture to survive.  If the owner works in the restaurant as a manager, she must collect a base wage for her services as well if she is to pay her mortgage.  If a break even level of sales is not reached (a level that can cover all of these costs of essential resources) the owner will have to invest more capital (short-term) or will possibly have to shut the doors to patrons (long-term) and will suffer great loss of down payment capital and with liability to the landlord and bank for the tenant improvements.  Of course we see restaurants fail and close often.  This risk may differ from the risk of launching a new publication for local distribution.

In the example of the restaurant, it may be that the expected income to the owner assuming success, given the costs of resources, is sufficient to pay the owner a fair wage to compensate for the contribution of time and effort as well as additional income to provide a return on the investment of savings and to serviced the debt requirements compensate for the risk of borrowing.  Let’s assume that the government is proposing to impose a minimum wage (or wage increase) and that prior to the increase, the restaurant owner was able to attract an available supply of labor for dishwashing and table bussing at $6 per hour.  Let’s assume the government is proposing an increase to $12 per hour.  The restaurant owner may realize that the net profit he expects will no longer provide for a return on investment and will substantially increase the risk that she will even be able to draw a wage for herself that will allow her to pay her personal bills.  The owner will feel trapped in that the bank and the landlord, who rely on and “banked” on her success will still require payment.  The owner could try and raise the prices on the menu to offset the cost but, ultimately, the owner would likely cut her losses and would close the doors and might file for bankruptcy protection.  The restaurant shut-down would cost the Chef, the bartender, the hostess, the bussers, the servers, the dishwashers and the owner their jobs.

Many proponents of increasing minimum wage complain that an employee at the current level ($6 in the hypothetical example) cannot be self-supporting.  Is it important that any solicitation for labor in our economy provide sufficient compensation to allow an individual to be self-supporting?  What about the family where the wage of the dishwasher supplements the income from another household member?  Many proponents suggest that the higher minimum wage will put money in the pockets of consumers and that this will improve the economy.  If this is true, I am wondering why we would be so foolish as to stop at $12 per hour as a minimum; why not $50 per hour or $100 per hour or $1,000 per hour?  If your answer is that $50 is too high or is ridiculous then I ask you:  why is $12 the proper and reasonable amount?  Because risk profiles are different for different businesses, maybe the minimum wage should be different for different businesses?

There is one mechanism available that can effectively set minimum wages for businesses at unique and different levels:  the invisible hand of the free market that provides for the pricing of resources according to the free market bidding and competition for those resources.  If people are sitting with no-employment at all, the restaurant owner, may be able to attract qualified labor for dishwashing at a lower rate, but if there are higher rates paid by homebuilders for laborers to the point that there is a shortage of qualified dishwashers, the restaurant owner would have to raise the pay rate accordingly.  Opponents to the free-market method believe that there is some guy with a suit on in Washington (who, of course spoke to a guy with a very slick econometric simulation model in a spreadsheet) who can determine that some single rate works best.  Of course this “Washington suit” does not want the restaurant owner to shut the doors of the restaurant or for the car wash owner to close after he attempted to raise his rates to pay his laborers only to find that the restaurant owner (along with other employed and newly unemployed) has decided she has plenty of free-time to wash her own car, given the higher prices.

The neighbor may be willing to hire the boy down the street to mow his lawn at $6 but would mow it himself at the $12 rate thus removing critical supplemental income for a struggling family.  How can one minimum wage rate be optimum and effective for all businesses providing goods and services when each business is subject to different supply and demand dynamics?  If I am hungry and in a government funded shelter and I can earn $2 per hour to pass out marketing fliers to augment my need for public assistance, isn’t it better for me than not to work at all to provide something for myself?  If you set the minimum wage too high, the business owner may pass out the fliers herself or may choose a different media method for advertising her city bike tour business.  Then the resource of effort provided by the unemployed worker is lost as well as the chance at some level of self-sufficiency and self-respect.  If there is no unintended consequence of failed businesses and loss of available jobs, then why not raise the minimum wage to $25, $50, $100 or even $1,000 per hour.  The invisible hand of the free market is considered ineffective by many because there are some jobs that would be priced at such low rates, that the job would not completely lift the employee from poverty (without other family income , public assistance, or communal efforts.)  But the hand of the suit in Washington is also imperfect and inefficient because it eliminates the opportunity for citizens to even partially contribute to their families or to limit the need for public assistance by artificially raising the price of a resource thus eliminating jobs that would otherwise exist.

While a minimum wage is an idea that was born from noble aspirations, it serves to have the opposite effect than the one desired.  With a minimum wage, we will have more people without an opportunity to provide for themselves.  This unintended consequence is inevitable and cannot be ignored lest you agree then that $1,000 per hour or more would be an even better policy than $12 per hour.  Unfortunately with incredible appeal and political skill, the politician calling for a higher minimum wage (quite appealing to the voters) will find a way to deflect responsibility for the unintended consequences of the government meddling with the free market and will blame them on his opponent.

One might ask what minimum wage has to do with personal sovereignty and the cause of freedom?  Minimum wage interferes with the freedom of one to offer employment to another at a free market price and with the freedom of one to accept an offer of employment from another at a free market price.  This limitation on the free will of both sides of the transaction is argued to be justifiable given the intent of it’s policy without full regard for the practical impact of it’s policy.  The goal of causing hard working people to receive a higher wage is noble while the unintended result of causing people to be wholly unemployable and then, by necessity, dependent entirely upon those still employed, at or above the minimum, is counterproductive and contrary to the goal itself.