We are emotionally drained here after Spain’s victory over neighboring Portugal in the Euro 2012 semifinal which took place in the Ukraine. From what we could tell, soveriegn credit quality was not mentioned nor did it have an impact on the match. As such, the correlation between a country’s sovereign credit quality and Euro cup performance is still being tested.
Spain downs Portugal! Euro 2012 prediction intact
If Germany downs Italy tomorrow, the hypothesis will hold, at least as far as the semifinals are concerned. We are predicting that Spain will disprove the hypothesis in the final and take the cup home.
Yet the Euro 2012, as are the Olympic games, which commence in just one tender month, are large scale distractions from the disease that ails the world and is threatening to rip it apart. Yes, fellow taxpayer, the insane “debt is currency” monetary experiment of the past 40 to 100 years is beginning to disintegrate.
Someday the historians will write about our times and lament: “They used debt as money, and corn as fuel,” or something to that effect.
While modern life is full of such contradictions, there are few with the potential to wreak such havok as the one where debt is forced into the role as money, which is akin to water being forced into service as oil.
But what is so bad about debt based currency? Doesn’t the ability to create money at will buffer everyone from suffering another depression?
On the contrary, the fickle nature of electronically created debts masquerading as money is economic suicide. This demands an explanation that we will not unduely withhold, for it about to burst out of us.
Capitalism is man’s only productive reaction to his Anarchic surroundings. It is inevitable that man would choose an increasingly free and capitalistic society as he gains a deeper understanding of natural law and his rightly understood self interests.
The expansion of the capitalistic system relies upon the division of labor in which men (we include women as we use the term “men” to define all of mankind) increasingly abandon self reliance and begin to trust their fellow men to provide them with life’s essentials.
This process is good, for it inspires and encourages widespread effeciencies in all spheres as man’s natural tendency to economize is rewarded as his actions align with what we refer to as the demands of anarchy and the natural economic law of supply and demand.
While this process is good, it is dependant upon capitalistic principles to operate in all spheres without exception. Any part of the system which succombs to hegemony (what we refer to as ‘Might makes right“) by one party causes all of those who mistakenly rely upon that part of the system to become vulnerable to its collapse.
The hegemonic parts of the system are prone to collapse because their existence is no longer owed to willing participation, but the use of force.
At the risk of oversimplifying a complicated issue, the more an organization encourages willing participation, the more it must adapt to the wants and needs of its clients. The process of adaptation makes the organization extremely strong and stable. It becomes a rock.
A hegemonic system, where organizations rely upon force to maintain thier positions, has already failed, for the organizations cease to adapt in a vain attempt to force others to adapt to them. The organizations in turn become weak and prone to collapse.
The largest hegemonic system operating today is the world’s monetary system, and it is on the verge of collapse. This debt based monetary system is especially dangerous because it has the effect of stimulating economic interdependence in much the same way that a healthy capitalistic system would while at the same time rendering useless or destroying the capital upon which a healthy capitalistic system relies upon to operate.
While the more perceptive members of society see it coming, the inevitable collapse causes the interdepence on which all rely to suddenly cease to operate. The result is chaos and suffering for the unprepared.
While there are many ways to prepare for this, there is only one way to start. It requires large amounts of humility, faith, and courage.
For now is the time to walk humbly with God and others. It is time to step, on the right with faith, which is provided by God, and the left with courage, which comes from within.
Faith…courage…faith…courage…faith…courage as we work together to pick up the pieces of the failed experiment to build something new, something reliable, something that will last.
For walking humbly in faith and courage is to live in the Kingdom of God.
As a treasury professional, we have more than a passing interest in money laundering schemes. For the unitiated, money laundering schemes are generally designed to make money earned through illegal activities, such as trafficking illegal drugs, appear as if it were earned legitimately, allowing it to freely navigate the financial system.
A great deal of the bureaucracy inherent in the banking system is an attempt to thwart would be money launderers. In the process, they make nearly everyone with a bank account a suspect.
One of the bureaucratic tools employed to nab money launderers is the SAS, or Suspicious Activity Report. This is why your banker wants to see your identification when you withdraw or deposit a large sum of cash, even though they have known you for years. The technical threshold for filing such reports is $10,000, but the bankers are further instructed to file an SAS whenever a deposit or withdrawl deviates from a client’s regular modus operandi.
This brings us to Smurfing. the term came to us via yet another informative report generously provided by Stratfor. Smurfing is the act of depositing a large amount of cash in amounts under $10,000 overseveral days and/or across several financial institutions for the purpose of avoiding an SAS. It is ineffective, for sure, yet it is technically a viable money laundering tactic.
The other money laundering technique described in the report (which can be read by clicking the link below) is much more interesting. It involves money being transferred to China from the US in exchange for appliances which and other goods which are shipped to Mexico and then sold.
The War on Drugs has made drug trafficking so profitable that even it is working as a bizarre sort of stimulus!
The point of the Stratfor report is to highlight the fact that there is an increased incidence of both drug trafficking and money laundering activity now that the US Feds have cracked down on the manufacture of methanphetamines in the 50 states. This report discusses the results of the law enforcement operation “Dark Angel.”
However, as the author points out, the lessons learned from Dark Angel may reveal more about money laundering techniques than they do about meth trafficking.
If this is what Stratfor provides for free email subscribers, we can only imagine the insights that a paid subscription would provide. Their analysis is insgihtful and borders on brilliant.
After defeating Greece in the quarterfinals, Germany will now face Italy in the Euro semifinals and, if they are victorious in there, either Spain or Portugal in the finals. If the 2012 Euro plays out according to the most recent soveriegn credit ratings, according to Moody’s, we should expect the following outcomes from the aforementioned teams:
Germany (Aaa) defeats Greece (Ca), which already occurred on Friday. Spain (A3) would defeat Portugal (Ba3) on Wednesday, and Germany (Aaa) would come out a hair ahead of Italy (A3).
The Germany would then come out victorious after handling Spain on July 1.
However, as Italy showed England yesterday, poor credit ratings can be overcome on the pitch. Therefore, we are speculating that Spain will defy Moody’s and take the cup.
Spain to defy Moody’s on the pitch
Ironically, a similar scenario is set to play out at the latest emergency EU summit (we have lost track but believe that there have been at least 14 prior to this one) where the Germans are set to capitulate on not only austerity measures but also restraint on monetary policy.
As unemployment in Europe’s club med regions rises, Germans and Europe in general will be keen to avoid a repeat of the rise of the Third Reich in their neighbors to the south.
With Greece predominantly in the headlines for its fiscal woes, this insightful report by Robert Kaplan explores the historical roots of Greece’s economic problems as well as its unique strategic advantage owed to its geographic location.
Is Greece European?
It can be a long road from political extremism and nepotism to a moderate political center, and this past weekend’s elections have shown that it is a road which Greece may not continue down, no matter how much prodding it gets from the increasingly desperate EU.
Greece, Inc. is now for sale. Its new management is preparing a list of demands for its current creditors, the Troika. If those demands are not met, Greece, Inc., which enjoys a prime geographical location, will prod its shareholders to accept an offer from the highest bidder, likely to be either Russia and/or China.
From Olympic sized overspending to the aftermath of the recent world wars, Kaplan does a fine job of presenting Greece’s history as a framework for understanding its current situation.
The report can be seen in its entirety via Stratfor:
This year, it is our privilege to get to know John, the author of a good portion of what is now the New Testament.
There is much to learn. Today, we had two revelations as we began our journey:
Revelation one has to do with what we willthe mechanics of rebirth. It is written in John 1:12-13 that those who believe in Jesus, the Messiah, are given the right to become children of God. How does this miracle occur?
It was revealed to us as the spirit of God penetrating the believer. It is a miracle, yet we will attempt to describe it as clearly as possible. The Spirit of God descends as a mere drop of oil on the head, which then enters the body, as if flesh were not a barrier.
Russian Orthodox icon of the Apostle and Evangelist John the Theologian, 18th century (Iconostasis of Transfiguration Church, Kizhi Monastery, Karelia, Russia)
This drop grows larger until it fills the entire physical presence of the believer, for it is the essence of the Lord permeating the flesh of the believer.
This was confirmed as we read the next line, John 1:14: The Word BECAME FLESH and dwelt amongst us. This vision and John’s choice of descriptive language reveal the deep understanding and intimacy that John has with the Father.
It is no mistake that in Chapter 3, the third witness of this truth appears as John recounts Jesus’ shock in John 3:10 that Nicodemus, a teacher of Israel, would be ignorant of the mechanics of spiritual rebirth. Nicodemus’ ignorance is striking because He was a Pharisee, one who believed in life after death and the coming of the Messiah.
The second revelation is that John was one of two disciples of John the Baptist, whom upon witnessing the baptism of Jesus, immediately followed Jesus and asked where He was staying. The other was Andrew. Both of these first disciples told their brothers that they had found the Messiah. The brother of Andrew was Peter, and the brother of John was James.
John, like Isaiah before Him, was eagerly awaiting the Jewish Messiah. While He was a fisherman by day, his spiritual thirst attracted Him to John the Baptist. His perceptiveness drew Him to Jesus.
The spirit of Isaiah was upon John, and the Spirit of the Living God is upon all of us.
The EU’s direct Spanish bank bailout, while ostensibly averting the latest in a string of events which threaten to blow the Euro to smithereens, has now raised the question of moral hazard for German politicians.
The path forward, as we have discussed in this space before, leads to the elimination of national sovereignty for the countries unfortunate enough to have adopted the Euro.
George Friedman discusses the scenarios which may unfold as the Eurozone inches closer to implementing their ultimate solution to the continent’s debt crisis: The Eurobond
Today, Jamie Dimon, CEO of JPMorgan, made his courtesy appearance before the home team, the Senate Banking, Housing, and Urban Affairs Committee earlier today.
It was, for the most part, a constructive exercise. Mr. Dimon had been called to explain something alarming, a $2 billion loss due to hedges gone awry in what is essentially the banks internal treasury operations. Alarming as it may be, the losses fell entirely on the backs of JPMorgan’s shareholders.
It was a stark contrast to the lambasting that Jon Corzine, former bureaucrat and MF Global chief, recieved by committees from both the House and Senate after his firm “lost” $1.6 billion of client funds. As JPMorgan was the counterparty to the transfer of a portion of those funds, it was only natural that a few questions with regards to the infamous event would find their way to Mr. Dimon today.
Generally, Mr. Dimon gave an impressive show in front of the home team crowd. As the largest bank on the planet and a Treasury Primary Dealer, JPMorgan may be one of the largest direct and indirect purchasers of US Bond issues. For the most part, the Senators were kind to their biggest customer. You can see the entire testimony here.
Some observations from The Mint:
Mr. Dimon knows what he is doing.
There is a reason that JPM is the banker and/or key liquidity provider of many smaller banks and sovereign nations.
It was brought up that loans are the riskiest investments that a bank makes, and JPMorgan is no exception.
The term “hedging” is widely misunderstood. Most take it to mean a trade made to eliminate risk, when in practice hedging has the effect of diversifying a portfolio of investments, often using leverage to do so.
Mr. Dimon’s brief response about the need for fewer regulations which are enforced rather that a myriad of regulators which lack expertise and authority was a brilliant appeal to common sense which mostly fell on deaf ears.
The US fiscal cliff will not wait until December 31, 2012 to produce derogatory effects for the economy. Individuals and businesses will begin to take actions to protect themselves long before the deadline approaches.
One of the Senators observed that the US Treasury ran a loss of $4 billion per day, twice the amount that Mr. Dimon’s firm had lost on its renegade trades.
Most of the Senators, while well intentioned, are absolutely clueless about the inner workings of a modern banking entity. Which begs the question, what qualifies them to regulate one?
JPMorgan is not to big to fail, rather, it is too big to save were it to fail.
One cannot apply the hedging and investment strategies of the world’s largest bank to the entire banking industry.
JPMorgan is in a league of its own, and thus is required to take risks on the scale that is difficult to fathom.
Mr. Dimon places little faith in financial models, which at best are a reflection of the immediate past and generally useless for future decision making.
New regulation costs as a result of the legislation inspired by the financial crisis for JPMorgan were estimated to be upwards of $1 billion.
It is not below the Senate to play the “US Taxpayer is on the hook” card when speaking with a banker, incorrectly implying that the US Taxpayer somehow thought that TARP and everything after was necessary and stands ready to take similar actions should another large bank get into trouble.
Much of the testimony was peppered with the common theme from the Senators which can be summed up in the phrase “how should we regulate you?”
While Mr. Dimon took the opportunity to point out that the so called Volcker rule was a bad idea, which is what has dominated headlines about today’s hearing, He did point out that JPMorgan’s survival was not dependant upon TARP and other bailouts, as has been suggested.
The message? Don’t regulate us and don’t save us.
In the end, isn’t that what true capitalism is all about?
When we attended graduate school in Spain, we were the first North American student in our course. It was late 2003 and the Eurozone was full of optimism. This optimism lead some of the professors to use a portion of their class time taunt the US model as failed and the European model as the obvious way forward.
As proof of European supremacy, our Finance professor often made a point of mentioning to us that the yields on the Spanish 10yr bond were almost the equivalent to the yields on the US 10yr bond.
What a difference nine years and 500 basis points make.
Circa 2012, Spain dominates the financial headlines as the latest casualty of the European debt crisis. Apparently Spain now is in need of a bailout. The bailout strategy which will be employed by Spain, Inc. is a hybrid of the prior bailouts accepted by their counterparts, Greece, Inc. and Ireland, Inc.
Greece, Inc. required a bailout because its government was broke. Ireland, Inc. was slightly more ingenious in that it made a good faith effort to backstop its banks, only to find that it was now the entity which required a backstop. Spain, Inc, theoretically learning from both experiences, forced its banks to accept the backstop directly so that the Spanish government could save face and be spared the humiliation of the Irish scenario.
Unfortunately, the markets have seen through the charade and are now putting pressure on all bonds, bank or sovereign, which hail from the Iberian Peninsula.
What a difference nine years and 500 basis points make!
Spain’s strategy has failed before it was even implemented for lack of collateral and credibility, both of which are in desperately short supply amongst the EU leadership.
How did once proud Europe end up in this situation? They decided to force a debt based currency integration by integrating only the currency part of the equation and leaving the debt and fiscal matters to chance.
As if choosing to use a debt based currency weren’t bad enough, choosing only to implement the currency is like handing the nations foolish enough to engage in such a gamble the revolver in a game of Russian roulette where the revolver is fully loaded.
Now, the revolver is being passed and it is Spain’s turn. Once Spain slumps to the floor, it is Italy’s turn, the Belgium, France, etc. until the European Currency Union, doomed from its outset, breathes its last.
At some point in the process, possibly as Spain pulls the trigger, USA, Inc. will be forced to step in with the “ultimate” backstop, the final hope of the failed, insane “debt is money” currency regime. As the US throws its sovereign credit rating in front of the runaway freight train of Europe’s soveriegns, it will quickly find itself in the very situation that it is trying to save the European Sovereigns from.
For in this debt crisis, the unwritten rule of quality holds. When one adds wine to sewage, one gets sewage. When one adds sewage to wine, one gets sewage. The sovereign vats have long since been polluted. It might make sense to check one’s portfolio and remove as much sewage as possible.
Beyond that, we will present two unsolicited yet practical bits of advice. First, US Bonds will ultimately slide as USA, Inc. wades across the pond to aid Europe. The Euro currency will rally as the run on European banks by the citizens and the wholesale dumping of any bond denominated in the currency begins. Quite simply, demand for the Euro will exceed supply in the short term.
Plan accordingly.
We submit to you that the Spain, Inc. debacle is further evidence of one of The Mint’s central themes, that Anarchy is man’s reality, it is an ultimate given, it simply is, and all understanding of the current political and social structures is greatly facilitated by one’s acceptance of this fact.
In fact, one’s ability to act and react to the unfolding changes in the current political and social structures depends upon accepting and embracing Anarchy as the basis for reality and learning to operate in the Truly Capitalistic system which organically emerges as men learn anew that mutual trust and cooperation are in their rightly understood self interests, and that he who is to lead must truly become the servant of all.
To truly embrace this fact, we must understand the nature of mankind. Man, left to his own devices, is completely devoid of the ability to do the right thing. He doesn’t have it in him. He is lazy, self-serving, and completely evil. He needs God and his fellow man to be able to do anything productive, altruistic, or what may be considered remotely good. A full defense of this statement is a subject for another day (although the evidence is all around us), we mention it here only to underscore the necessity of a framework which presupposes this fact within which mankind can use this weakness to avoid both self and mutual destruction.
The only reliable framework which has emerged out of natural Anarchy which not only addresses the problem of human nature, but also turn man’s weaknesses into strengths is what we call True Capitalism. Ironically, by allowing market forces to work with as little hindrance as possible, mankind can insulate itself from descending into chaos and catastrophe.
In fact, to fight the workings of True Capitalism is, by default, to submit oneself to chaos and misery. Yet every nation on the planet is devoted to some degree in the fight against True capitalism. Why? Because the nation state sells itself as the most perfect expression of man’s good intentions, which we presuppose do not exist. In other words, the dream of the nation state is built on a false pretense that is usually attributed to socialism: That man is inherently good and wants to do good to others.
Given their presuppositions, is it clear that the nation state and a truly capitalistic society are, in fact, the antithesis of one another. Where a nation state regulates by edict, truly capitalistic society regulates by example. Where a nation state is rigid, where truly capitalistic society is pliable. Hence, where truly capitalistic society will bend but not break, the nation state is repeatedly smashed to pieces when faced with change.
For the more a nation state tries to force men to do good, the more mankind’s character flaws will overtake these good intentions until the nation state becomes an expression of mankind’s evil nature.
The truly capitalistic society allows each mans evil nature to be corrected by allowing him to experience the consequences of his inherently poor behavior, paradoxically and naturally improving the behavior and norms of all.
Moving to a less philosophical level, how can we be sure that Anarchy is the basis of man’s current existence? The evidence can be found in that the institutions which supposedly offer the best option to Anarchy, the nation states if the world, are beginning to succumb to the punishments they have built up in their losing fight against natural law.
Greece, Ireland, Portugal, Italy, and now Spain, Inc. are now succumbing to the inevitable. The member of club med which turns from the failure of the Euro currency to go it alone and embrace the much feared “Anarchy,” as it were, paradoxically stands to be richly rewarded by the flocks of tourists who can suddenly afford a European vacation without the Euro.
We conclude with a brief manifesto for your perusal and enjoyment. What does the future hold?
Out of Anarchy, a Truly Capitalistic System will ORGANICALLY emerge, and with it a new dawn for humanity, built on mutual interest and almost endless capital formation which will engender a spontaneous and dynamic social order, a society without borders that would enjoy freedom and prosperity that we cannot even imagine under current conditions.
As the world continues to hurtle towards a form of financial armageddon, at The Mint, we have become increasingly reflective. Ed Harrision of Credit Writedowns, recently posted regarding the causes and effects of the current financial crisis/recession/depression which much of the western world now finds itself in.
In the essay, Mr. Harrison observes that one of the root causes of the financial crisis is the combining of financial deregulation with desupervision and the decriminalization of financial crimes.
The most notable example of this phenomenon has been the MF Global Bankruptcy. On the surface, it would appear that the firm purposely helped itself to its clients’ segregated funds in order to cover the firms margin calls which it received in those gloomy days in late October of 2011.
In layman’s terms, this is robbery. Yet in the parallel universe of the insane “debt is money” monetary system in which we live, John Corzine, the CEO of MF Global at the time and supposedly the one who is ultimately responsible for the firms actions, is able to freely walk the streets after telling a series of Congressional committees that He had no knowledge of the “transfers” (read: theft) of client’s funds which were illegally used by MF Global in a desperate attempt to stave off the firms imminent collapse in late October of 2011.
We do not wish to further flog Mr. Corzine, or for that matter, Jamie Dimon, who, as the CEO of JPMorgan, served as an accomplice to the theft (for JPM happily took the missing client funds as collateral in the fateful transfer), for their consciences, if indeed they have one, must be flogging them daily without mercy.
We do, however, wish to flog the idea of decriminalization when it comes to the financial industry. Like sending remotely controlled drones into war, the digitalization of the world in financial matters gives the actors involved a false sense that they are operating not in the real world, but in a virtual world where they alone are acting.
How does this false perception of reality play out and, more importantly, differ from what is commonly understood as real life?
In the example of the remote controlled drone, the drone facilitates acts which more resemble murder than self defense, for it is much easier to convince a teenager, who has been raised playing video games where the actions taken on the screen have no real world consequences (save wasting otherwise valuable time), to kill someone if it can be done by giving them a video game control and a sofa from which to guide their armed drone into real world combat over half the world away.
The experience for the teenager on the sofa is similar to that of the video game and, as such, has the effect of removing the real world consequences of having murdered persons who posed them no existential threat. It is as if the distance both dehumanizes the very real interaction which is taking place.
So it is with financial crimes. As persons begin to conduct a great portion of their financial transactions, especially those involving large sums of money, in a virtual world with little or no human contact, it becomes easier for persons who have access to the funds of others to shun their fiduciary duty and use the funds of others for their purposes without their consent.
While the technical medium employed is an electronic transfer, the actions similar to those taken by Mr. Corzine are more accurately described as robbery.
Yet as of today, Mr. Corzine has not been accused of a crime.
The problem is not that crimes such as murder via remote controlled drone and robbery via wire transfer take place, for robbery and murder have been unfortunate parts of the human experience since the dawn of time.
Nor is it a problem that the means to commit these crimes exist and are used as a normal part of life. For remote controlled airplanes and electronic wire transfers may have great benefits.
No, they problem is that the misuse of these mediums has been largely decriminalized. Those who use them to commit crimes can now justify their actions behind a smokescreen of words and those who should be holding these persons accountable appeal to some good greater than Justice that is being served: Security and Financial stability.
However, without Justice, security and financial stability are mere illusions.
What is important is to have a belief in one’s principles which is firm enough so that it is impossible to compromise them, even when holding to them causes one personal injury.
Bettie Mitchell, the founder of Good Samaritan Ministries, recently shared the story of how her father visited her one day, unannounced, when he was 70 years of age. This was unusual because she knew that her mother had not sent him, which had always been the case in the past.
She knew that what he was to say was important, and that it did not come from him, but from the Holy Spirit.
Her father arrived at her house, she let him in. He entered, sat down and told her the following:
“When I was your age, I had all of the spiritual gifts that you have. Then I began to compromise.Never Compromise.”
With that, Bettie’s father got up, and walked out. There was nothing more to be said, the message had been delivered.
There are principles by which one must live their lives which cannot be compromised upon. Put a different way, it is much easier to stand by one’s principles 100% of the time that 95% of the time.
Once one compromises on their principles 5%, or even 1% of the time, they begin to go down a slippery slope. They are constantly searching for the next patch of firm ground upon which to stand as they find themselves caught sliding down an increasingly unstable incline.
How easy it would have been to simply stay on the level path, even if it did take a little longer to get to one’s destination.
Today, while lawmakers, Judges, and central bankers struggle to find their moral compass as they slide further down the slippery slope they have set out on, we challenge each and every one of you, fellow taxpayers, to stay on the path, where it has always been wrong to steal, and it has always been wrong to murder.
For it is this increasingly narrow path that leads to life.
This particular report focuses on the failure of the United States’ recent nation building strategy which has relied on counterinsurgency operations. It also explores what viable defense strategy may take its place, namely, the broader use of specialized, highly mobile and scalable units to defend key geographical areas which are vulnerable to highly motivated and increasingly well equipped non-state actors.
It is a fascinating look at the logical evolution of US defense strategy as it retools itself to better and more effectively meet increasingly global security demands. Via Stratfor:
A colleague from our grad school days in Barcelona recently contacted us from Madrid with an exciting project he and a partner are developing. As such, we are unwittingly trying our hand at the emergent Natural Cosmetics Market.
While Spain and Europe in general appear to be falling apart at the seams, his company is experiencing a boom. As with most smaller enterprises, all it lacks is some well guided investment to transform this mini-boom into a supersonic boom. “El Empujon”, we call it. The big push to get them over the hump, to open new markets, scale production, and create countless jobs in the value chain.
It is just this sort of thing that Governments in the West espouse in word but make nearly impossible in deed.
While the products are all natural, they may be subject to FDA approvals. Then, once the governmental hurdles are cleared, we face a fiercely competitive market where access to the final consumer is tightly controlled by what amounts to a monopoly or at best, an oligarchy, in the cosmetics world. Then there are patents, customs, and any number of mines in the field which must be avoided or diffused to successfully bring the products to market.
How shall The Mint attack this Goliath? We are working on a strategy, which we call, the “Heart of the Beast.” The details of which, for obvious reasons, we shall keep a well guarded secret for the moment.
More on this to come.
In our last correspondence, we presented a hypothesis for dealing with government. Now, we must move the hypothesis down a level. How, then would one test the hypothesis by embracing anarchy, or atheism with regards to government, in a place like Oregon?
Oregon is a State which places a relatively large amount of faith in its political system and, by extension, the power of the government to solve social problems.
The approach seems to work for most. The territory is home to an abundance of natural resources and a great number of people who are willing to go along with the government’s program. In these conditions, the idea and mechanisms of government are tolerated and to an extent championed, for it is possible to live in Oregon and enjoy a relatively high standard of living despite the waste inherent in governmental activities.
Disarming the State is as simple as changing and then using one's mind
However, one can only wonder as to what may be possible here in the great Northwest were the government not to hyper regulate every industry or confiscate 9% of the wages earned by those who labor in its borders (on top of the roughly 21% that the Federal government lays claim to).
Is the average citizen better off living on 70% of his wages? Or, put another way, does the average citizen derive enough benefit from being “governed” that he or she would value it at roughly one third of his or her income?
There are burning questions, fellow taxpayer, that every citizen would do well to ask themselves from time to time. If the mechanism of government were to go away, or be reduced to the spheres where it paradoxically does add value to the economy (note that, were this the case, it would technically cease to be government and become yet another capitalistic enterprise operating in the anarchic surroundings), would it not hold that everyone, including those who work in the unproductive areas of government, would be better off on a relative basis?
The answer, of course, is yes, unless one finds themselves in a position which relies upon the government being able to confiscate a certain amount of resources or the privileges which the mechanism of government may grant them.
However, even this minority would be better off once they adjusted to the reality of life without the idea of government.
What about the Disaster aid, Police and Fire Departments? Aren’t they at least necessary?
Of course they are! And for that very reason, private organizations would quickly spring up to fill these vital roles. In fact, they already exist. They are commonly known as Security and Insurance companies. In Anarcho-Capitalist theory, the array of companies which would arise are called “Private Defense Agencies.” Anyone skeptical about what would arise in a purely anarchic system to replace functions currently delegated to the Nation State is encouraged to study this theory.
For in some ways, the Nation State is simply an over diversified and poorly run Private Defense Agency.
As with any failing capitalistic entity, when a Nation State has gone from being a servant of the people to active enslavement, its lack of popularity invariably shows up in its deteriorating financial condition. This fact alone is proof that Anarchy is the context in which the Nation States of the world today act and operate. On this basis alone it is proper to constantly question the relevancy of the State with regards to its utility against viable alternatives.
Yet despite the failure and bankruptcy of nearly all of the Nation States that have existed and the presence of well developed theories which offer alternatives to these failures, the mechanism of the Nation State remains in place and retains for itself a monopolistic power over defense, welfare, as well as the right to generally meddle in all of the affairs of its subjects at whim.
When living within geographical boundaries of a failing Nation State, it is wise to be prepared to live as if it did not exist, which means that functions vital for one’s existence must be secured by the individual or a cooperative independant of the failing Nation State, for it has been observed throughout history that the authorities of a failing Nation State have a tendency to pillag…we mean, relieve their subjec…we mean, citizens, of their means of sustenance by the most expedient means available.
What is the most expedient means possible? If the Nation State controls the money supply, they simply print money and acquire resources, which is more the rule than the exception circa 2012.
Once a Nation State has begun to relieve their citizens of their wealth in this way, it is possible that those who understand what is going on will convince all to resist by way of armed conflict. However, this is rarely effective, for it tends to replace one form of tyranny with another. These methods rely upon might to make right, which most thinking persons are keenly aware is a losing proposition.
Persons and Nation States, especially those that are desperate and have resorted to robbery, rarely give up their arms willingly or peacefully, so it is up to the individual to peacefully disarm it. This is best done by using a tactic that is not coincidentally very effective against the school yard bully.
Avoidance.
How can one do this? For practical purposes, we have compiled a brief list of steps which one could take to avoid and thereby peacefully resist a Nation State which has failed:
1.Money, trade what you want to: Conduct trade in a currency other than the one used to pay the tax. For it is proper to give to Caesar what is Caesar’s. While it may be inconvenient at first to trade using alternative currencies, one may find that it is often not obligatory to use Caesar’s money.
2.Rely on Common sense: Ignore laws and excessive regulations and respect the free will of those you work with. If someone is willing to work for you for less than minimum wage, allow them to work, do not deprive them of a job to comply with an arbitrary wage set by a bureaucrat. Make no conscious distinction between contract workers and employees, for both are freely performing work.
3.An important caveat to this is to not brag about flouting unreasonable laws and regulations. Assume that if you are breaking a legitimate labor law, for example, both you and the employee will know of it and have dealt with it long before the government will deal with it. It is the false hope that government is regulating untenable working conditions that gives rise to untenable working conditions in the first place.
4.Come out of Babylon: If you live in a place where the microscope of government regulation is unavoidable, move until you can freely live a safe distance from it.
5.Cross borders: If language is not a barrier and your trade or profession is not location specific, there should be no resistance from either government to crossing national borders in search of better opportunities, for all stand to benefit from this.
6.Sell what consumers want, not what the government allows you to sell. The greatest test of a product (food included) is public opinion. Government approval of products, like labor laws tend to give the population a false sense of security.
As we have stated above, if the Nation State’s intentions are pure and in harmony with Natural Law, there should be no resistance from them to an individual who chooses to take these steps.
If, on the other hand, the bankrupt Nation State begins to pass and enforce laws against these actions, restricting freedom and by default, trade, in a vain effort to pillage its subjects to pay the politicians’ debts, it then shows itself to be predatory.
Anyone who has attempted to take any the steps above has likely encountered some sort of resistance to taking these actions. What may come as a surprise is that the resistance may not have come directly from the government itself, for the government of a failing Nation State, or any Nation State for that matter, does not have the resources to enforce all of the rules that they put on the books.
Rather, resistance, more often than not, comes from well meaning but misguided fellow citizens who are unwittingly trained by the government’s education system to deter these brave souls on the questionable moral basis of simply obeying the rules, no matter how unreasonable they may be.
You must be logged in to post a comment.