Tag Archives: Might Makes Right

ebooks, Empire, Freedom, Jesus, Politics, The Mint

On the Nature of Empire

3/8/2013 Portland, Oregon – Pop in your mints…

In today’s Mint we submit to you, fellow taxpayer, an excerpt of our upcoming E-book release:  On the Nature of Empire.  Enjoy!

Empire:  An Introduction

empire -/’empī(ə)r/- noun -1. An extensive group of states or countries under a single supreme authority or oligarchy.

Derived from the Latin imperium, the word Empire has come to embody the concept of dominance on a grand scale.  From the time of the original Akkadian, Mayan, and Egyptian Empires to the more recent Greek, Roman, and British versions, the ignoble goal of all Imperial activities has been to establish and maintain primacy in the affairs of men and women throughout the entire known world.

Proof of this is found in the nearly invariable behavior of the heads of Empire, known as emperors and empresses, who come to embody the ultimate conceit of the imperial mindset by attempting to establish themselves as a deity.  The conceit is always fatal, for this ridiculous presumption has the nasty side-affect of destroying any shred of legitimacy that the head of Empire may have previously established.  However, whether or not the emperor publically manifests a claim to deity by demanding reverence reserved for the truly divine or, at the opposite end of the spectrum of possible outcomes, they make a demand for reverence that goes largely unchallenged, those who have reigned in the emperor’s chair have invariably come to assume that they had, at their disposal, the divine right to liquidate any and all threats to their claim to the ultimate power over their fellow mortals.

In the twenty first century, it has become clear to most that there is no divine right or imperative for the existence of an Empire on the earth.  As such, an ever increasing number of peoples have thrown off the yoke of Empire in favor of a what has become known as a democratic model of collective governance.  Yet simply changing the rules of governance has not put an end to the core ideals of Empire, and the hallmarks of Imperial rule, namely the tendencies towards a central monopoly on the use of force and the right to demand tribute, have been largely retained by governments today that are elected democratically.  How can this be?

The concept of Empire is a construction of men, and is largely a result of a tolerance by the many of what is nothing more than antisocial behavior by a few.  As we have stated above, an Empire, at its base, is a monopoly on the use of force which evolves into a monopoly on the right to demand tribute.  Living under Imperial rule is not man’s natural state, and it will eventually come into conflict with mankind’s natural disposition for autonomy, commonly known as freedom or the right to self determination.

Why do the many tolerate the antisocial behavior by a few that ultimately leads to Imperial rule?  The answer is that Empires do not appear overnight.  They emerge over relatively long time horizons and, until they approach their blow off phase, may appear to have many benefits.  However, these benefits always come at a great human cost, a cost that is almost always obscured from those who receive them.

It should come as no surprise, then, that there is no historical evidence of an Empire spontaneously arising by mutual consent.  On the contrary, Empires are created and expanded by subjugating a territory and the peoples that inhabit it via either the threat or actual use of military force.  Once subjugated, the Empire attempts to consolidate its control of the territory by exacting tribute from its subject.  From ancient times up to today, an Empire’s demand for tribute ultimately manifests itself in taking control over the food supply.

Joseph and His Brethren Welcomed by Pharaoh, watercolor by James Tissot 1836-1902
Painting “Joseph and His Brethren Welcomed by Pharaoh”, watercolor by James Tissot 1836-1902

One of the more poignant historical examples of this can be found in the Biblical book of Genesis, where Joseph advises the emperor of Egypt at the time, Pharaoh, to store up the Egyptian grain production for a time in anticipation of a seven year famine.  The Pharaoh then sold the grain back to the Egyptians and foreigners during the famine.  While the story generally has a happy ending, it is a stark example of the Imperial prerogative to confiscate property via taxation.

Given this example, it is no surprise that the first known system of taxation was in Ancient Egypt around 3000 BCE – 2800 BCE.

Paradoxically, the subjects of Empire, who could just as easily eat from the foodstuffs they produce and store up their own rainy day funds, find themselves rendering their harvests to the representatives of the Empire, in the case of the Pharaohs, a full 20% of their production, only to be forced to beg them back at a future date when the need arises.  The Paradox is furthered in that the Empire, in attempting to maintain primacy via various forms of taxation, ultimately ensures its demise, as the inherent waste in the Imperial model overwhelm its ability to extract further tribute from its subjects.

The mechanism of taxation itself causes the Empire to weaken, as it indirectly encourages sub optimum activity and in the worst case, inactivity and waste by those who receive the benefits of the proceeds of the taxes.

Long before the Empire becomes aware of its weakened state, the subjects themselves are often the first to realize that the Emperor is wearing no clothes, to borrow Mr. Andersen’s metaphor.  Those with the means and the initiative will move to escape the withering grasp of the Empire.  Those who do not leave are often left to perish in a futile effort to either defend the Empire or oppose it through the same force of arms by which the Empire came to their lands.  For an Empire must ultimately demand allegiance from its subjects, and an intolerance for dissention will tend to increase in direct proportion to the level of weakness of the Empire.

As such, for an Empire to perpetuate itself, it must rely entirely on the force of arms when necessary and coercive propaganda at all times in an ultimately futile attempt to assure it retains the primitive right to meddle in the affairs of others.  In the final blow off phase, which is marked by civil wars such as the one currently playing out in Syria, the Empire will resort almost exclusively to the use of arms to squash dissention.

Yet the maintenance of Empire, like the air travel industry, is in every case a losing proposition.  It is an utter and complete waste of time and money.  To maintain an Empire requires an ever increasing amount of human and intellectual capital which are depleted in ever increasing quantities as the Empire slides into history’s dustbin, where it will simply attach itself to the long list of Empires that were.

The concept of Empire has always been lethal to human existence and prosperity.  However, for some reason it is romanticized in the human psyche.  The purpose of this volume is to gain an understanding of the true nature of Empire and, to convince the reader that not only is Empire, and by extension large scale government, unnecessary, but it is a hindrance to human progress and virtually ensures that the worst elements of humanity will rise to power, where they will ultimately impose their will on the rest of us by violence.  For the violent outcomes the Empires invariably produce are not exceptions to the rule, nor are they merely the norm.

They are literally guaranteed.

Finally, we address Pontius Pilate’s infamous inquiry, to Jesus of Nazareth before His public trial:

“What is truth?”

It is a question that has been left to humanity for two millennia, and it is time that it be answered, for in the answer lies our common fate.

Intrigued?  Stay tuned to The Mint for the book’s release.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for March 8, 2013

Copper Price per Lb: $3.51
Oil Price per Barrel:  $91.95
Corn Price per Bushel:  $7.25
10 Yr US Treasury Bond:  2.06%
FED Target Rate:  0.16%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,585 THE GOLD RUSH IS STILL ON!
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.7%
Inflation Rate (CPI):  0.0%
Dow Jones Industrial Average:  14,397
M1 Monetary Base:  $2,481,500,000,000 LOTS OF DOUGH ON THE STREET!
M2 Monetary Base:  $10,377,900,000,000

Empire, Peaceful Resistance, Politics, The Mint

Three Reasons why we’ve stopped voting, The Trail of Tears

10/18/2012 Portland, Oregon – Pop in your mints…

As we watched the Presidential debate Tuesday night, along with the rest of the huddled American masses, we were hoping to hear something that would sway us from our current non-voter status.  We hardly listened to what was said, although our radar went up as one attendee asked about inflation, which happens to fall into our realm of interests.  The periscope of our consciousness went down, however, as each candidate responded in turn with a stream of words which registered as a vague reference to a non-entity referred to as “the economy.”

They just don’t get it.  And unless someone at the top “gets” the concept of inflation and its root causes very soon, the current form of the United States government may not exist by the time the next Presidential term is completed.

With the exception of the inflation bit, we hardly listened to what was said.  Politics, as most politicians will attest, has nothing to do with the keeping or breaking of promises.  In the end, these expensive popularity contests boil down to the intangible of charisma.

As such, we were more interested in the demeanor of the candidates.  Both, while giving the appearance of physically fit, well dressed, and well informed men, seemed to lack something we call the spark of life, that thing that makes you want to be around somebody.  The intangible of charisma, so hard to define, yet so apparent when present, did not make an appearance last night.

We decided to retain our current policy regarding democratic elections.

At The Mint, our current policy is to refrain from voting on all matters which ask us to reach beyond our own city and county.  Even then, we inform ourselves and vote, not on individuals seeking election to sinecures, but on specific referendums, generally with the dual aim of obtaining personal benefit and minimizing both our tax bill and governmental interference in our personal affairs.

As such, if and when we vote, it is an exercise in shameless self interest.

How did we arrive at such an unreasonable stance with regards to voting?  How can we consciously fail to perform our “civic duty” year in and year out and still live with ourselves?

The conscious decision not to vote, at its base, is our way of peacefully resisting what has become a shameless power grab at the highest levels of government.  A series of well intentioned actions at the Federal level has lead to a number of unintended consequences which are about to cause a great deal of suffering.

Beyond this philosophical objection, there are practical matters to consider, which we submit for your examination and comment:

1.  Mind-boggling complexity

From time to time, a ballot measure will be presented which will be stated in a manner so clearly that one can place a vote and know exactly what a yay or nay will mean in terms of real world consequences.  As for the rest of the ballot issues, along with the selection of lawmakers and judges as our proxies, one can’t be expected to keep up with the chaos that passes as national and state governments, and for the most part, we feel that participating in elections or the political process on at these levels is at best a waste of precious time and, at worst, encouraging an enterprise which long ago overstepped any reasonable boundaries, both in its authority and its ability to manage its finances.  At this point, the best one can hope for is to stay clear of the amoeba.

Large scale democracy has a nasty habit of imposing the will of a few on all via the ignorance or indifference of many.  Circa 2012, voters are rarely asked straightforward questions like “Is it ok to steal and kill?” They are instead asked questions like “Do you prefer a fellow named Obama or Romney to serve as President?”  We will ignore the fact that politicians on the State and National level are thrust immediately into situations where keeping promises depends upon factors far beyond their control, and simply recognize that the choosing the President of the United States does little or nothing to change the underlying bureaucracies and interests which have turned the Government of the United States into a strange form of benevolent mafia.

2.  The question of taxes.

By our calculations, we give up roughly 16 hours per year just compiling data for and filing the required tax declarations at the State and Federal levels.  Not to mention the time spent generating the money to pay said taxes.  On the county level, this seems reasonable.  The county even has the courtesy to calculate the tax bill for us and simply request payment.  As for compliance, it is simple, you either pay the bill or you don’t.

Further, if you think that your tax bill is too high, you can leave the City or County and find a City or County with a more reasonable tax regimen, or no regimen at all.

While leaving the City or County may be a costly step, it may be feasible for those who desire to move.  Relocating geographically from a State or a Country is quite another matter, which makes their manner of taxation both understandable and sinister.

The Federal and State governments, as opposed to most county governments, have a much different take on both taxation, as well as the rest of the authorities which they have granted themselves over their subjects.  We use the term “grant themselves” because, as anyone who has tried to vote their conscience on a ballot measure can attest, many measures are written in a way that simply makes the voter a tool in the hand of those who crafted the legislation.

{Editor’s note:  We will refrain from going into the argument that somehow, the illusion of democracy, the Western embodiment of the “Might makes right” mentality, creates a government with legitimacy on the scale the the State and Federal Governments circa 2012 claim.  It is sufficient to say that there are an abundance of examples which would argue to the contrary.}

Returning to taxation with regards to the State and Federal regimens, it is up to the individual to file a declaration each year at their own expense.  Naturally, the governments reserve the right to audit said declaration, again, at the taxpayers expense.  If any inconsistencies are encountered, the taxpayer faces a myriad of penalties from the payment of additional taxes and penalties up to and including serving time in prison.

Even this tack could be considered reasonable were the tax codes written in a straightforward manner.  As things are, the income tax code serves as nothing more than a spider’s web, designed to entangle all who tread it.  We are all caught in it, it is just a matter of time until the spider makes its way over to devour us.

The saving grace, if there is one with regards to the State and Federal tax regimen is this.  They can’t take us all.  While it is likely that every single American has failed to fully comply with the 73,608 page tax code, it is extremely unlikely that the spiders of the various Government or State tax authorities will ever get around to eating all of those who are caught in their web.  As with any predator, they tend to go after the larger prey first.

In this sense, adopting the Franciscan/Marxian belief that poverty is a virtue may keep one safely off of the spider’s radar.

3.  The Trail of Tears

While both complexity and having to pay for something are generally good enough reasons to abstain from any activity, the most compelling reason not to vote is one that is best understood by examining one of the most shameful examples of the modus operandi of the Federal Government:  Their well documented dealings with the Cherokee people, whose world collided with the Feds in the early 19th century in the Southeastern part of North America.

Trail of Tears
The Trail of Tears, a painful chapter in US History – courtesy of http://katta1f.wikispaces.com/

We refrain from making value judgments and will simply examine the highlights of the interaction as we understand them.  A much more detailed account can be found, as always, in the Wikipedia.

The Cherokee found themselves generally prospering as a people and inhabiting lands in the Southeastern US in the 1700 and early 1800’s after presumably relocating there from the Great Lakes region.  During this time, they increasingly came into contact with European settlers and engaged them in trade.

As time went on, the increasingly organized and well armed colonies began to covet the lands of the various Indian groups in North America.  Once the revolution against the British and subsequent conflict known as the War of 1812 had been won, the States of the newly formed United States of America began to dispossess the various Indian peoples of their lands.

{Editors Note:  Sensitive readers are asked to excuse, for the moment, the use of the term “Indian” (Columbus most likely died believing that he had landed in India en route to China, hence the mistaken identity attached to Native Americans peoples), instead of the appropriate “Native American”.  The choice to change terms at this point in the essay was made consciously so that the reader may understand which groups were impacted by the barbarous Indian Removal Act.  No disrespect is implied or intended.}

While their tactics changed according to what was politically expedient at the time, the general policy of the State and Federal Governments was to ultimately expel the Indian populations and force them West, so that the vested interests of the States could take advantage of the lands which were occupied by the Indians.

What is most troubling about the treatment of the Cherokee people is that, from what we can tell, they had adapted to life amongst the new colonists and generally worked to comply with what were ultimately unreasonable demands of the governments.  As a case in point, the Cherokee allied themselves with and fought alongside the US against the pro-British factions during the War of 1812.  They served the US’s interests in the war alongside none other than Andrew Jackson.

Jackson later returned the favor by signing the Indian Removal Act in 1830 which sealed the Cherokee’s fate and began the final chain of events which would lead many of them to an early grave along the now infamous “Trail of Tears.”

While the the Indian Removal Act was passed on the assumption that the Cherokee and other Indian groups faced certain extinction were they to be forced to live alongside the increasingly numerous white settlers, it is generally acknowledged today that the real motivation for the Act’s passage was the discovery of gold in Georgia.

We have read about and watched similar scenarios of deceptions preceded and followed by apologetics play out too many times by centralized governments over the ages to believe that a group of persons who do not know our name and are so far removed from us that they would not recognize our moccasins if they took the time to walk a mile in them, have our best interests at heart.

Even if they did, we have observed that their best efforts to effect change on a large scale end up causing more harm than good.  While the economic damage done by such unilateral actions can be repaired or forgiven, the damage to the moral character of a society of embracing this might makes right mentality will ultimately destroy it.

The desire not to participate in the choosing of the next person to be called “Commander in Chief,” or any of their collaborators or subordinates, is the primary reason why we will not be walking around with a sticker on our chest or an ink stained hand on election day.

For The Trail of Tears has been tread for too long.  It is time to live in the Kingdom of God.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for October 18, 2012

Copper Price per Lb: $3.72
Oil Price per Barrel:  $92.12
Corn Price per Bushel:  $7.39
10 Yr US Treasury Bond:  1.81%
FED Target Rate:  0.16%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,750 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.8%
Inflation Rate (CPI):  0.6%
Dow Jones Industrial Average:  13,557
M1 Monetary Base:  $2,449,400,000,000
M2 Monetary Base:  $10,157,100,000,000

Empire, Jesus, Peaceful Resistance, The Mint

On the nature of Empire, Part III: What is Truth?

9/10/2012 Portland, Oregon – Pop in your mints…

The distinction between the failed “Might makes right” mentality, which is the ideological base for all Empires, and what we have termed the better way, which can be summed up in the words of the Golden Rule:  “Love your neighbor as you love yourself,” was made clear to all in an event that can only be adequately described as the flashpoint in human history, the moment which literally opened the possibility to choose the better way.

This critical moment is related for us in the Gospel of John, chapter 18, verses 37 and 38:

37 “You are a king, then!” said Pilate. Jesus answered, “You say that I am a king. In fact, the reason I was born and came into the world is to testify to the truth. Everyone on the side of truth listens to me.”

38 “What is truth?”retorted Pilate. With this he went out again to the Jews gathered there and said, “I find no basis for a charge against him.”

John 38: 17-18
a papyrus shroud containing the text of John 38: 17-18

For those unfamiliar with the scene, which is expounded upon in John 38:28-40, this historic exchange between Jesus and the Roman Governor Pilate takes place in Pilate’s residence, which is referred to as the Roman Governor’s Palace, in Jerusalem on the day before the Jewish Passover in what is now known as the year 33 CE according to the Gregorian calendar.  It was witnessed by none other than the Apostle John.  It is evident by its inclusion in John’s gospel that He grasped the full importance of the exchange.

For John was witnessing the start of a revolution.

Pilate, the governor, was Rome’s representative in Jerusalem, capital of the rebellious province of Palestine.  He spent his days tempering an uneasy peace between Caesar and the Jewish majority of the region.  His life was a daily exercise of the compromising principles and choosing the lesser of evils.  Perhaps more than any historical character, He represents the inescapable consequence of humanity orienting itself by the “Might makes right” mentality and the ever present fear that it engenders.

Pilate was the embodiment of Empire.

Jesus before Pilate by Nikolai Ge 1890
Pilate utters the lament of Empires across the ages: “What is truth?”

His reply to Jesus’ statement about everyone on the side of truth listening to him (Jesus), “What is truth?” is neither a contemptuous mock of Jesus, nor an honest question, rather, it is an exasperated utterance of a man whose life has been reduced to endless compromises, and has seen that the lesser of evils is, in any and every case, necessarily evil.

One must wonder how many heads of state today utter these same words as they contemplate the clear moral law in contrast to what they have been called to do in this life.

How many career military men, after carrying out an assault on the enemy, have grappled with this lament in their souls?

Each of them may grapple, if indeed they pause to reflect on such matters, with a contradiction which has been eloquently expounded by Adin Ballou, who wrote a significant body of work on peaceful resistance, in his pamphlet entitled:  “How many Men are Necessary to Change a Crime into a Virtue?”

“One man may not kill. If he kills a fellow-creature, he is a murderer. If two, ten, a hundred men do so, they, too, are murderers. But a government or a nation may kill as many men as it chooses, and that will not be murder, but a great and noble action. Only gather the people together on a large scale, and a battle of ten thousand men becomes an innocent action. But precisely how many people must there be to make it so?–that is the question. One man cannot plunder and pillage, but a whole nation can. But precisely how many are needed to make it permissible? Why is it that one man, ten, a hundred, may not break the law of God, but a great number may?”

Yeah, it is a contradiction that rightfully haunts thinking persons the world over to this day.

Que es la Veritat
The question that haunts thinking persons the world over to this day, “I que es la veritat?” (“And what is truth?” translation from original Catalan) highlighted by Antoni Gaudi the Passion facade of the Sagrada Familia in Barcelona. (Photo by Etan J. Tal)

At this flashpoint in history, Pilate speaks for all of them.  The Might makes right system, which must avail itself to represent the truth in a vain attempt to cloak itself with a shred of legitimacy, leaves its thinking adherents searching in vain for a truth that ultimately relies on the fragile force of arms to perpetuate itself.

On the other side of the truthless void embodied in the person of Pilate, is Jesus, the Messiah.  Jesus brought the truth with Him wherever He went.  As He stood, soon to be condemned to death by the Might makes right mentality which was swallowing the world, He embodied the truth as never before.  John witnessed this moment in the governor’s palace and remained shocked to the end of his days.

The Apostle John
The Apostle John, witness to the watershed moment in human history

To Pilate’s lament, “What is truth?” Jesus replies, then and forevermore: “God Forgives.”

In doing so, He ratified what he had preached in the Sermon on the Mount, to turn the other cheek, what is know today as the doctrine non-resistance.

Ever since that fateful day, which represents THE watershed moment in all of human history, mankind has had the choice to chose the Golden rule, “Love your neighbor as you love yourself,” over the self destructive system of Might makes right.  For Jesus represents the clear change in God’s relationship with mankind.  God would no longer claim His ultimate authority on the failed Might makes right philosophy, for there is none mightier than the Living God.  Rather, He chose to cleanse the world through Jesus, the ultimate example of non-resistance.

Jesus’ crucifixion served as an indictment to every soul who would claim triumph by defeating others.  It served notice of the moral bankruptcy of the world system.  For over 2,000 years, those who have stopped at the cross to soak in the message, as John did, have been relentlessly making the world a better place.

In His resurrection, Jesus shattered every excuse for those who believe in Him to cling to the failed system of Might makes right, for to cling to the system is to live in constant search of, or worse, a fear of a truth which has already been revealed.  It is to deny that the kingdoms of this world are perishing and the the Kingdom of God is advancing EVERY DAY.

The Christian, then, has no moral standing when embracing the “Might makes right” mentality in defense of property and even life.  Jesus showed us the better way, the way to the Father.  He is preparing for us a home in God’s Kingdom, where the rule of Might makes right is vanquished, where peace is permanently established and treasures are secure, for the Golden Rule reigns supreme.

Yet the true irony and divine beauty of embracing the doctrine of non-resistance here and now is that it serves to enhance both the peace and security of the adherent.

Why not give peace a chance?

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for September 10, 2012

Copper Price per Lb: $3.62
Oil Price per Barrel:  $96.28
Corn Price per Bushel:  $7.81
10 Yr US Treasury Bond:  1.68%
FED Target Rate:  0.16%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,724 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  8.1%
Inflation Rate (CPI):  0.0%
Dow Jones Industrial Average:  13,254
M1 Monetary Base:  $2,385,400,000,000
M2 Monetary Base:  $10,002,100,000,000

Empire, The Mint

On the nature of Empire, Part I

8/30/2012 Portland, Oregon – Pop in your mints…

Those who have followed The Mint for a reasonable amount of time may have noticed a shift in focus, if indeed there ever were a focus.  At first, we simply commented on the folly of the economy post August 2007, when the wheels began to come off.  We spent our digital ink examining the Federal Reserve and the perversions of what we use as money with a focus on current, even daily events.

Since those days, we have begun to examine the corroded bases of the economy, financial system, and society, as it were.  We poured through “Human Action: A Treatise on Economics” the magnum opus of Ludwig Von Mises and compared its compelling logic to the economic reality that we observe in the world around us.  What we have found has been all at once predictable and surprising, it that is possible.  A world where time and progress have been accelerated by the accumulation of a completely unnatural amount of debt.

On one hand, the accumulation of debt has enabled men to make technological advances which were not even dreamed of a generation before.  On the other, this debt has created severe imbalances in the natural world for which the only cure is the liquidation of said debt and an uncomfortable change in the daily activities for many.

Chart - Decline in US Capital Stock
August 2012 has seen a decline in private capital stock in the US. Coincidence or evidence of Empire? Courtesy of The Money Game at http://businessinsider.com

We’ve found that debt, left to its own devices, has a way of achieving equilibrium.  Credit is created in response to anticipated increases in the capital stock.  However, with the advent of Empire, which we define as a centralized system which employs the philosophy of “Might makes right” to dominate its subjects, debt came to be associated not with increases in the supply of capital, but by decree of the imperial authority.

The nature of an Empire is simple.  It arises out of some sort of ambiguous idea of payment for a common defense.  Through this seemingly logical argument, the Empire extracts a certain amount of voluntary tribute, what today are commonly called taxes, as people make a conscious choice to cede a portion of their earnings for the common defense.

Yet it doesn’t stop there.   With its nascent consolidation of the power to resort to violence, the Empire inevitably expands its activities beyond the maintenance of a common defense.  Most of these extensions of power are more difficult to palate for those subject to the Empire.  They naturally begin to look for ways to lower their tribute.

A view of Empire througout the world - A Map of World Empires 1900-1914 by Geordie Bozanko
A view of Empire throughout the world – A Map of World Empires 1900-1914 by Geordie Bozanko

The lower tribute coincides with increasing monetary outlays by the Empire, which it must fund by issuing debt.  Yet debt issued by an Empire has nothing to do with an anticipated increase in the capital stock, rather, the proceeds are used to fund deficits as the “Might makes right” model goes to work destroying the capital stock of both the Empire and those subject to it.

As the capital stock begins to dwindle, the Empire naturally progresses to using its monopoly on force to take control of the food supply.  Those subject to the Empire are required to render crops as tribute and then to accept a ration of food from the Empire.  Once the Empire has control of the food supply, the supply “mysteriously” begins to dwindle.

Whatever economic pretense that the Empire was founded on is sacrificed in the blind pursuit of a de facto communism.  The end game, which has played out numerous times throughout history, involves starvation, moral deprivation, violence, and revolution.

As the script has played out over the centuries, civil persons everywhere have been known to murmur, “there must be a better way,”

More tomorrow.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for August 30, 2012

Copper Price per Lb: $3.42
Oil Price per Barrel:  $94.62
Corn Price per Bushel:  $8.11
10 Yr US Treasury Bond:  1.62%
FED Target Rate:  0.13%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,655 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  8.3%
Inflation Rate (CPI):  0.0%
Dow Jones Industrial Average:  13,001
M1 Monetary Base:  $2,306,900,000,000
M2 Monetary Base:  $10,032,900,000,000

Events

Watch “Prime Minister of Israel Binyamin Netanyahu at AIPAC 2012” on YouTube

A decent speech from Mr. Netanyahu at the AIPAC 2012, and unfortunately there is much prophecy that would be fulfilled were Israel to strike Iran, or vice versa.  It is a difficult situation, and Mr. Netanyahu may be admired for not skirting around the issue, as the Western nations have done until now, for it is gravely serious.

Yet for all of his wonderful discourse, the most moving of which starts at minute 22:30 of the below video, Mr Netanyahu, like most of us, misses the point. 

Jesus came so that the world would be forgiven, and to overcome death and live abundantly.  Resorting to the “Might Makes Right,” “Strike them before they strike us mentality,” to which Mr. Netanyahu appeals in this address, is what leads all nations to espouse war and violence as a response to their fragile surroundings.  Followed to its logical end, mankind would exterminate itself in a very short period of time. 

While a preemptive strike against a country which is going to annihate your nation may seem like the best response, or the least amongst evils, what is even more necessary is a need for understanding and ultimately the abandonment of the nation state, especially the religious nation state, so that people can deal with each other without the unnecessary prejudices which the mask of the nation state paints on its adversaries. 

With that in mind, enjoy the speech and, as you ponder its obvious consequences, pray for the peace of Jerusalem, Tehran, and your own city.

Economics, The Mint, True Capitalism

Why the morally corrupt are assured of promotion in and leadership of the Might Makes Right ideological system – Part II

11/23/2011 Portland, Oregon – Pop in your mints…

If you were not able to join us yesterday for Part I, please take a brief moment to review it by clicking here:

Why the morally corrupt are assured of promotion in and leadership of the Might Makes Right ideological system – Part I

We will pick up where we left off…

The acts which are required to carry out an economic system doomed to failure inevitably insures that those who lead would be the worst amongst us in terms of adhering to any sort of moral code, for they have chosen to pursue the economic or political program above the obligations of morality, no matter what the cost.  They possess the ability to mute their conscience and oversee acts that are increasingly despicable and outrageous in pursuit of the aims of the program.

Hayek goes on to argue that as the Totalitarian economic and social program inevitably begins to fail, the leader of said system would increasingly deem it necessary to employ a larger number of individuals to enforce the increasing sacrifices required to continue the program.  He offers three reasons why this inevitable outcome further assures that the leader surrounds himself with and encourages the promotion of those who are capable of the worst forms of moral corruption:

“First, the higher the education and intelligence of individuals become, the more their tastes and views are differentiated. If we wish to find a high degree of uniformity in outlook, we have to descend to the regions of your moral and intellectual standards where the more primitive instincts prevail. This does not mean that the majority of people have low moral standards; it merely means that the largest group of people whose values are very similar are the people with low standards.

Second, since this group is not large enough to give sufficient weight to the leader’s endeavors, he will have to increase their numbers by converting more to the same simple creed. He must gain the support of the docile and gullible, who have no strong convictions of their own but are ready to accept a ready-made system of values if it is only drummed into their ears sufficiently loudly and frequently. It will be those whose vague and imperfectly formed ideas are easily swayed and whose passions and emotions are readily aroused who will thus swell the ranks of the totalitarian party.

Third, to weld together a closely coherent body of supporters, the leader must appeal to a common human weakness. It seems to be easier for people to agree on a negative program — on the hatred of an enemy, on the envy of those better off – than on any positive task. The contrast between the “we” and the “they” is consequently always employed by those who seek the allegiance of huge masses. The enemy may be internal, like the “Jew” in Germany or the “kulak” in Russia, or he may be external. In any case, this technique has the great advantage of leaving the leader greater freedom of action than would almost any positive program.

Advancement within a totalitarian group or party depends largely on a willingness to do immoral things.”

The Might Makes Right ideology, then, far from being a viable alternative to True Capitalism, assures a slow march towards a society which openly ignores the rule of law and, as a consequence, quickly becomes devoid of morality.

Can you now see why the ideological battle between True Capitalism and Might Makes Right is much more than a simple choice of economic systems, rather, it determines the moral basis upon which a majority of the society’s members will act.

 

Jon Corzine - A shining example of leadership in the Might Makes Right system

Unfortunately, we have a shining example of the phenomenon of the worst rising to the top in Jon Corzine, former governor of New Jersey and CEO of the now infamous investment bank, MF Global.  Mr. Corzine is a career investment banker and politician.  In other words, he has been firmly indoctrinated and skillfully trained in two of the most destructive trades known to mankind.

Mr. Corzine allegedly saw nothing wrong with raiding the cash accounts of MF Global’s clients in a vain attempt to stave off the firm’s bankruptcy which was declared on October 31, 2011.  There is no way to sugar coat what happened in the days leading up to MF Global’s demise.  MF Global allegedly robbed its clients’ accounts to meet its own obligations.  The fact that the commodity exchanges have been allowed to operate without immediately making the defrauded clients whole has caused an unprecedented breach of the trust which underpins the smooth operation of these exchanges.

Perhaps Mr. Corzine thought he was still a politician.  In Government, it has become a common and acceptable practice to rob a legally established trust fund and replace it with the government’s IOUs.

Mr. Corzine is but the most recent example of the level of hubris and moral corruption required to occupy a high level post in the government and financial sectors circa 2011.

The MF Global bankruptcy and subsequent actions taken by the regulators have called into question whether or not the rule of law will prove supreme in such a situation.  As a society increasingly leans towards a Might Makes Right ideology, the excuses for ignoring the rule of law proliferate.  Hayek observed the inextricable link between the rule of law and Freedom when he wrote the following:

“NOTHING distinguishes more clearly a free country from a country under arbitrary government than the observance in the former of the great principles known as the Rule of Law. Stripped of technicalities, this means that government in all its actions is bound by rules fixed and announced beforehand.”

The most famous modern excuses for ignoring the rule of law during the war on terror and the financial crises are: “These actions are taken in order to protect the American people,” and “These actions have been taken to ensure the stability of the Financial System.”

Fellow taxpayer, do you personally feel safer than 10 years ago?  Do you believe that the financial system is more stable than five years ago?

These are important questions, for the answer may reveal which side of the ideological battle one identifies with.  True Capitalism or Might Makes Right, for there is no ideological middle ground.

The governments of the world are busy tirelessly advancing a failed program.  It should come as no surprise, then, that nearly every action that the governments have taken to fight the war on terror and the financial crisis only seem to have made the original problem worse.

It is clear that as long as the Might Makes Right ideology is embraced by institutions and governments, those who are best able to ignore basic morality and the rule of law are most likely to populate their halls of power.

It should come as no surprise, then, that man’s only hope for justice is to reject Might Makes Right and embrace True Capitalism.  Only then will lasting peace and prosperity be attainable.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 23, 2011

Copper Price per Lb: $3.34
Oil Price per Barrel:  $98.01

Corn Price per Bushel:  $5.98
10 Yr US Treasury Bond:  1.95%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,700 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  -0.1%
Dow Jones Industrial Average:  12,096  

M1 Monetary Base:  $2,121,700,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,644,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, Gold, Politics, Silver, The Mint, True Capitalism

Why the morally corrupt are assured of promotion in and leadership of the Might Makes Right ideological system – Part I

11/22/2011 Portland, Oregon – Pop in your mints…

After a brief break in our faithful correspondence, we are compelled to pick up the proverbial pen to complete an incomplete thought in a vain attempt to eat Thanksgiving dinner in peace.  If you are a new reader of The Mint, we will simply relate that the Mint is the product of a deep felt agitation by its author.  It is what could be referred to as therapy.  The thoughts, once on paper, leave us in peace.  Until then, they stir, deep in our spirit, waiting to escape via these words.

How very fortunate and long suffering you are, fellow taxpayer.

Before we continue our mantra of Anarchy, True Capitalism, Natural Law, and Might Makes Right, we will share a few important observations.

First, the MF Global implosion is now reported to have left a $1.7 Billion hole in the capital base of a highly leveraged commodity and derivatives market.  MF Global was a primary dealer, one that had the unconditional trust of the exchange and other secondary commodity dealers.  It was a silent pillar of these markets.  The aftermath of their implosion, both in loss of capital and confidence, has only begun to unfold.  Commodity markets are no longer “safe” by normal standards.  This situation is best watched by your money at a distance.

Second, while Europe implodes, the US has been spending most of its time firming its position in Asia.  There has been speculation that the US is moving to aggressively devalue the dollar vis-à-vis the Yuan.  Will it be the 10:1 reverse split that we have speculated about here?  No one knows, but it would appear that the US Dollar will not serve as a reliable store of wealth in the short term.  Silver and Gold come to mind as viable substitutes as this drama plays out.

Occupiers take note of a Bolivian tactic of blocking major thoroughfares

Finally, It appears that the Occupy protesters are now wising up and using tactics which we call the Bolivian tactic, that of blocking major thoroughfares.  It is much more effective, not to mention exciting, than urban camping.  As a practical matter, if your livelihood in any way relies on a major thoroughfare being open in an area where the protests are growing, we suggest that short term contingency plans be considered.

These events and any pain they cause should be short term, maybe three to four months of adjustments, if they are allowed to simply run their course.  If the Government continues to intervene, they will plague us indefinitely.  We pray for the former and prepare for the later.

With that off our chest, we continue pondering life as we know it.  Our question today is:  Why does it seem that the worst morals seem to come out on top?  First, a glance at Isaiah:

“ And I will make boys their princes, and infants shall rule over them.  And the people will oppress one another, every one his fellow and every one his neighbor; the youth will be insolent to the elder, and the despised to the honorable,”  Isaiah 3:4-5

Have you ever complained about a politician?  The government?  How about your boss?  The current state of society?  If you haven’t, you are indeed a rarity in this day in age, for there is much complaining, and seemingly much to complain about.

How did we arrive at this, fellow taxpayer?  If democracy is supposed to deliver the cream of the crop in terms of leadership in the government, why does it seem that most politicians are the epitome of immoral liars?

This question was thrust upon us as we were reading the “Is there no shame” rant at zerohedge.com and came across the words “Hayek’s theory that the worst always rise to the top.”  We then perused Hayek’s theory in an excerpt from the “Road to Serfdom.”

In the section entitled “Why the Worst Get to the Top,” Hayek states that:

“There are strong reasons for believing that the worst features of the totalitarian systems are phenomena which totalitarianism is certain sooner or later to produce.

Just as the democratic statesman who sets out to plan economic life will soon be confronted with the alternative of either assuming dictatorial powers or abandoning his plans, so the totalitarian leader would soon have to choose between disregard of ordinary morals and failure. It is for this reason that the unscrupulous are likely to be more successful in a society tending toward totalitarianism. Who does not see this has not yet grasped the full width of the gulf which separates totalitarianism from the essentially individualist Western civilization.”

Suddenly, it all makes sense.  As man has generally chosen to pursue the Totalitarian, or what we call the Might Makes Right ideology, it would follow that those thrust into power should be among the most immoral, unscrupulous, human beings on the planet.

In summary, the Might Makes Right ideology unwittingly promotes the worst individuals to positions of power, as they are best suited to carry out the immoral and contradictory demands which are invariably made of the persons occupying positions of power in such a system.

Depressed?  Don’t be.  It doesn’t have to be this way.  More tomorrow.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 22, 2011

Copper Price per Lb: $3.34
Oil Price per Barrel:  $98.01

Corn Price per Bushel:  $5.98  
10 Yr US Treasury Bond:  1.95%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,700 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  -0.1%
Dow Jones Industrial Average:  12,096  

M1 Monetary Base:  $2,121,700,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,644,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, Gold, The Mint, True Capitalism

Natural Law: The Golden Rule

11/15/2011 Portland, Oregon – Pop in your mints…

We continue today with our brief examination of the foundations of society here at The Mint.  We are finding that while society appears complex on the surface, the further that its elements are reduced, the foundation is extremely, perhaps painfully simple.  Any complexity that we experience is not a product of an inherent complexity in natural laws, rather, it is a product of the human relationships and actions that are a result of man’s choice of response to the demands of natural law.

For those of you joining us for the first time, let us get you up to speed with a synopsis:

Anarchy, the lack of government, is man’s natural state.  It is an ultimate given.  It simply is.  A clear understanding of the current state of affairs depends upon grasping this inescapable fact.

In response to Anarchy, man has two choices.  He can choose to mutually cooperate with his fellow man, respecting both his fellow man’s right to live and his right to property, or He can choose to take his fellow man’s life and property through the use of force.  We have called the path of mutual cooperation “True Capitalism” and the path of forceful coercion “Might Makes Right.”

Ideologically, there is no middle ground between these two paths.  In practice, men live at various points on the spectrum between these two ideological extremes.

We argue that True Capitalism is the response which creates the greatest benefits for the greatest number of people.  The proof of the superiority of True Capitalism is that it allows man to best adapt and react to the inescapable demands of Natural Law.  Like Anarchy, Natural Law is immutable.  It does not change, for its statutes are etched in the foundations of the earth itself.

Last Thursday we presented the Natural Law of supply and demand, a law that deals with what is concrete and tangible.  Today we will deal with second law which primarily governs human relationships and works in conjunction with the law of supply and demand.

It is popularly called the Golden Rule.

The Golden Rule is articulated and exalted as an ideal in some form in nearly every society and religion on the planet.  The Bible famously articulates the Golden Rule in the following way:

“Love your neighbor as you love yourself” (Deuteronomy 6:5)

It is important to note that the Golden Rule is a positive declaration.  It is a call to action.  In many societies and religions the Golden Rule is stated in a negative declaration, a command to abstain from action.  An example of this can be found in Hinduism:

“One should never do that to another which one regards as injurious to one’s own self.”  (Anusasana Parva, Section CXIII, Verse 8 )

The negative declaration is sometimes called the Silver Rule.  It is important to understand that only the Golden Rule, the positive call to action, is Natural Law.  Observance of the Silver Rule, while highly advisable, does not rise to the level of Natural law.  However, it is a logical corollary to the Golden Rule.

Compliance with the Golden Rule, as with all natural law, is indispensible.  It is ignored at one’s peril, for it operates regardless of one’s acceptance of its validity or not.  The Truly Capitalistic society greatly facilitates and encourages compliance with the Golden Rule.  Conversely, compliance is hindered in a society that has embraced Might Makes Right as its ideological response to Anarchy.

“Wait a minute,” some of you are saying, “I’ll give you that the Golden Rule is a great ideal but Natural Law?  No one requires it of me, right?”

Remember, the essence of Natural law is that it is universally true and applicable to all.  The law of Supply and Demand, for example, can be ignored for a time, but every moment of ignorance causes the consequences of that ignorance to accumulate further until a final breaking point is reached.  The result of the failure to comply with the law of supply and demand is material scarcity and ultimately death.

The same is true of the Golden Rule.  Every moment of ignorance causes the consequences of that ignorance to accumulate further until a final breaking point is reached.  In the case of the Golden Rule, the result of the failure to comply is by definition a failure to properly comply with the law of supply and demand as well, with the end result, as mentioned above, being material scarcity and ultimately death.

Compliance with the Golden Rule is a necessary prerequisite to compliance with the law of supply and demand, for the Golden Rule governs relationships in the purest sense.  This is evident to most who have taken the time to ponder it.  So broad are the implications of the Golden Rule that the origins of both the rule of law and more recently the concept of human rights can be traced to it.

What thrusts the Golden Rule out of the realm of being simply a good idea and into the realm of Natural Law is this:  All attempts to comply with the Golden Rule serve to coordinate the actions of men in such a way that the greatest number of human needs are met in the most efficient way.  Any deviance from the Golden Rule, by definition, is a failure to meet human needs in the most efficient way.  Again, by definition, failure to meet human needs in the most efficient way means that a greater number of human needs are simply not being met.

Far from being simply a moral standard, the Golden Rule is elemental in the determination of supply and demand.  As the equilibrium price serves as the beacon of production for the law of supply and demand, the actions taken by men, governed by the Golden Rule, initially determine the supply and demand factors which, when combined, produce the equilibrium price.  In this sense, the Golden Rule serves as the beacon for both supply and demand which enable the creation of an initial equilibrium price.

How can the Golden Rule run ahead of the Law of Supply and Demand?  This is one of the beauties of Natural Law.  Natural Law always compliments and never contradicts itself.

An Example of the operation of the Golden Rule

Each human being has needs and wants which are sources of uneasiness.  Human Action, to paraphrase Von Mises, consists of men acting to dispel their most intensely felt uneasiness.  If a man is hungry, he will direct his actions towards getting something to eat.  Other tasks will be put on hold until this intensely felt uneasiness is relieved.

The operation of the Golden Rule, in the example of mans the need to alleviate hunger, operates in the following way.  A man feels hunger.  He has two options before him with which to fulfill this need.  First, he can forage, hunt, fish, or perform any series of actions with the end of fulfilling this need.  Second, he can voluntarily cede some of his production (or production for others via his contribution of labor) or appeal to the charity of someone else in return for something to eat.

As the second way is the most expedient, it is likely that a majority of people will elect this option.  Now reflect upon the Golden Rule:  “Love your neighbor as you love yourself.”  The person who chooses to comply with the Golden Rule will quickly understand that if he has the need to be fed, it is likely that his neighbor (in this sense, neighbor would mean anyone in the geographical realm in which he is equipped to serve, up to every person on the planet if it is possible for him to serve them) is likely to have the same need to some degree.  With this revelation, he unwittingly is on his way to discovering demand.

As he seeks to voluntarily fulfill this demand, he will need to either produce the supply of food himself or he can voluntarily cede some of his production (or production for others via his contribution of labor) or appeal to the charity of someone else in return for a supply of food with which to provide his neighbor with something to eat.  The information that his adherence to the Golden Rule provides him with regarding the needs of his fellow man will serve to guide his speculation as to where to best employ his limited time and capital.

It is a simple example, yet its simplicity serves to highlight the operation of the Golden Rule and can apply to any situation regardless of the complexity.  The Golden Rule, in modern business school lingo, is the origin of market research; it is the impulse for entrepreneurial activity and is the basis for subsequent human actions.

The Question of Charity

What about charity?  Wouldn’t adhering to the Golden Rule quickly lead to widespread scarcity and bankruptcy as catering to everyone’s preference to receive something for free would quickly deplete all available supplies and production?

The answer lies in the Golden Rule itself:  “Love your neighbor as you love yourself.”  Would you like to provide something for someone and not receive compensation?  Our guess is only if you are in a position to give something away and are willing to do it.  If all members of society are complying with the Golden Rule, the norms of charity will fall under the governance of the law of supply and demand.

The beauty, the perfection, of the Golden Rule is that above all it demands balance in human relationships and by extension, balance in the supply and demand of material goods.

True Capitalism Enable Compliance with the Golden Rule

True Capitalist ideology completely subjects itself completely to the Golden Rule and, in return, most accurately directs human actions towards fulfilling the most urgently felt needs of the greatest number of people. 

Inefficiency is naturally wrung from the system at its source as errors are quickly corrected and information is quickly disseminated via equilibrium prices.  The proper identification of demand by default leads to the most efficient allocation of scarce resources possible.  The liberty of life and property which is ensured in the Truly Capitalistic system allows men to supply this demand by employing their limited time and resources without unnecessary hindrance.

The Golden Rule may not provide everyone with what they expect or what they think they desire, but complete submission to it not only creates the most efficient allocation of resources, it gives humans the best information to base their attempts to mutually cooperate to fulfill the myriad of human desires.  It has the added social benefit of creating the greatest amount of harmony and goodwill possible in human relations.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 15, 2011

Copper Price per Lb: $3.49
Oil Price per Barrel:  $99.39

Corn Price per Bushel:  $6.45
10 Yr US Treasury Bond:  2.06%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,781 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  0.3%
Dow Jones Industrial Average:  12,096  

M1 Monetary Base:  $2,215,000,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,532,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, Gold, Silver, The Mint

Natural Law: the transcendental importance of Supply, Demand, and Equilibrium Prices

2 Comments

11/10/2011 Portland, Oregon – Pop in your mints…

As Europe continues to unravel, we have been exploring, perhaps by accident, the foundations of society here at The Mint.  In case you have missed it, here is a brief recap:

Anarchy, the lack of government, is man’s natural state.  It is an ultimate given.  It simply is.  A clear understanding of the current state of affairs depends upon grasping this inescapable fact.

In response to Anarchy, man has two choices.  He can choose to mutually cooperate with his fellow man, respecting both his fellow man’s right to live and his right to property or He can choose to take his fellow man’s life and property through the use of force.

In other words, man may choose the path of True Capitalism or Might Makes Right.  Ideologically, there is no middle ground.  In practice, men live at various points on the spectrum between these two extremes.

We have argued that True Capitalism is the response which creates the greatest benefits to society in terms of peace, security, capital accumulation and material prosperity while the ideology of Might Makes Right by definition is the antithesis of the Truly Capitalistic ideology and consequently would create the greatest detriment to society.

Ironically, all of the Nation States in existence derive their power from the adoption of the Might Makes Right ideology by a majority of the people.  How, then, can we be so certain that True Capitalism is the proper response to Anarchy if the majority has embraced Might Makes Right?

The proof of the superiority of True Capitalism is that it allows man to best adapt and react to the inescapable demands of Natural Law.  Like Anarchy, Natural Law is immutable.  It simply is.  Man is bound to it whether he chooses to recognize it or not.  It does not change, for Its statutes are etched in the foundations of the earth itself.

It is as Ayn Rand stated:  “You can ignore reality, but you can’t ignore the consequences of ignoring reality.”

In our example, we take the reality that Rand refers to as Natural Law.  Natural Law may be ignored, but ignorance always comes at a price. 

The first of these Natural Laws is that of supply and demand.  The Law of supply and demand, simply stated, holds that supply of and demand for a good or service will tend to find a point of equilibrium at a certain price expressed in terms of money (the equilibrium price).  On a graph the relationship looks like this:

A Graphical Representation of Supply, Demand, and Equilibrium Price

In simple terms, it is a way of expressing what most people intuitively know.  When an item is increasing in price, one of two things is happening.  Either people are demanding more of the good or service or the supply of the item at the previous equilibrium price point is diminishing.

Naturally, the opposite is also true.  When an item is decreasing in price, one of two things is happening.  Either people are demanding less of the good or service or the supply of the item at the previous equilibrium price point is increasing.

In either case, the change in the price of the item in monetary terms is providing crucial information to all of those either producing or consuming the good or service in question, for it guides their inherent speculations.

(Editors Note:  Speculation, far from being an illegal or immoral activity, is essential to everyday survival and without it, there is no hope of achieving equilibrium prices and therefore both production and consumption tend to cease.  It is important to clarify that the illegal or immoral speculation that is villianized today is generally the act of investing the money of other parties in types of speculations without the knowledge or consent of the other party to do so.)

As a producer, if one sees the price of the good or service that one provides increase, the producer will strive (speculate, as it were) to either increase production to take advantage of the opportunity to profit and/or others will strive to produce the good or offer the service for which the price is increasing.

As a consumer, if one if one sees the price of the good or service that one consumes increase, the consumer will strive to either decrease consumption to mitigate the effects of the higher prices or others will strive to find a less expensive substitute for the good or service  to offer in the place of the good or service for which the price is increasing.

Stay focused, here comes the important part.  The increase in production will increase supply which, as the Natural Law of supply and demand dictates, will eventually lower the equilibrium price as the increase in demand is satisfied.  Likewise the decrease in demand will have the effect of increasing the available supply. 

In either case, the individual decisions (again, speculations, as it were) of the producers and consumers serve to increase the available supply.  The process occurs tacitly, and is an example of what Adam Smith famously called the Invisible hand of the market.

To further sum it up in what may seem at first a paradox, the best cure for higher prices is higher prices.

There are no exemptions from the natural law of supply and demand, however, there are numerous examples of Nation States, guided by the principal that Might Makes Right, manipulating the pure message that price is intended to send to producers and consumers.

This manipulation may be achieved in overt ways, such as price controls (the setting the price of an item by decree).  However, most people understand that price controls are bad, so today’s Nation States commonly resort to other tactics.  Amongst these tactics are taxes, subsidies, and the granting exclusive privileges to either buy or sell the good or service in question via regulating the purchase of or granting monopolies to produce it.

Regardless of the tactic employed, the result is to always a manipulation of the equilibrium price for a good or service and consequently distort the signal which guides the speculations and ultimately the actions of all producers and consumers.  The result of society as a whole is always and in every case achieving suboptimum results to those that would be achieved if the price signal were as pure as possible.

In the case of Central Banking and centralized currency control, the Nation State, in addition to the tinkering mentioned above, adds the complication of manipulating the currency that the equilibrium prices are expressed in.  This further distorts the sacred price signal that is universally relied upon to direct the actions of producers and consumers.

You can imagine the confusion occurring all around us, every day.

The True Capitalist ideology, on the other hand, completely subjects itself completely to the law of supply and demand and, in return, provides producers and consumers with best opportunity to obtain and act on the most accurate price information possible.

A Truly Capitalist society quickly settles on Gold and/or Silver as currency and does not recognize the right of anyone to tax, regulate, or grant monopolies. The Truly Capitalist Society continually works to bring supply and demand into balance in the simplest, most efficient way possible:  By relinquishing all control to the market participants and by extension, natural law.

Inefficiency is naturally wrung from the system as firms that depend upon the false price signals or special protections or subsidies provided under the Might Makes Right ideology quickly go out of business.

True Capitalism not only quickly eliminates economic waste, it quickly directs the surplus capital into its most urgently needed employ, and it is accomplished by simply obeying and embracing the natural law of supply and demand.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 10, 2011

Copper Price per Lb: $3.39
Oil Price per Barrel:  $98.04

Corn Price per Bushel:  $6.49
10 Yr US Treasury Bond:  2.07%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,749 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.1%
Inflation Rate (CPI):  0.3%
Dow Jones Industrial Average:  11,861  

M1 Monetary Base:  $2,122,700,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,507,600,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, The Mint, True Capitalism

Responses to Anarchy: True Capitalism vs. Might Makes Right

11/9/2011 Portland, Oregon – Pop in your mints…

We have been mulling over the basic tenets of True Capitalism, the economic system which is man’s most productive response to the state of Anarchy in which he finds himself.  Far from being an undesirable reign of chaos, Anarchy, the absence of government, is the natural state of man.  If Anarchy is simply an ultimate given, then it is man’s response to Anarchy that must be examined.

In response to this natural state, man has two options:  He can choose to mutually cooperate with his fellow man, respecting both his fellow man’s right to live and his right to property or He can choose to take his fellow man’s life and property through the use of force.

In other words, man may choose the path of True Capitalism or Might Makes Right.  Ideologically, there is no middle ground.  In practice, men live at various points on the spectrum between these two extremes.

Responses to Anarchy: True Capitalism vs. Might Makes Right

What may come as a surprise is that all of the Nation States on the planet have come into existence by and base their operations on the principal of Might Makes Right.  No matter how much freedom the Nation State may allow its citizens, it must be recognized that the Nation State stakes its claim on the individual’s life at birth, by declaring them a citizen and in many cases requiring either military service or registration to be conscripted into military service should the nation state deem it necessary.  The Nation State then stakes its claim on the individual’s property through either taxation or a myriad of rules and regulations regarding the use of said property.

Far from being an ultimate given, the Nation State, at a basic level, is an entity which provides varying levels of security and welfare services.  What differentiates the Nation State from other agencies providing security and welfare services (think security firms and insurance companies) is that the Nation State enjoys a geographic monopoly which it enforces by both the threat and use of violence against its captive audience, otherwise known as citizens.

This is the world today, and any sober look at the facts will lead one to conclude that man has chosen Might Makes Right as the dominant response to our Anarchic natural state.

Yet there is a better way.  True freedom and prosperity can be found by embracing True Capitalism and abandoning the Might Makes Right doctrine.  In contrast to Might Makes Right, a revolution cannot be undertaken to change man’s response to Anarchy from Might Makes Right to True Capitalism by violence, for by definition violence is simply a furthering of the Might Makes Right response, not a step towards a Truly Capitalistic society.

As the famous David Wilcox lyric goes:  “resentment doesn’t die with the dead”

Rather, a revolution which would naturally, by definition, bring about a Truly Capitalistic society involves rejecting all aspects of the Might Makes Right doctrine.  It involves renouncing any and all choices which make use of violence, whether undertaken personally or by directing the Nation State to use violence on one’s behalf, to take the life or property of another while at the same time asserting one’s rights to have their own life and property respected as inviolate.

On the surface, a Truly Capitalistic society may not look that different from the current structure of things.  There may arise security and insurance companies which serve geographical areas in tandem in such a way that they closely resemble current Nation States.  However, assuming that the paradigm is changed and man truly embraces Truly Capitalistic ideology, nobody will be compelled under the threat of violence to be a client of the security or insurance company.  Rather, individuals holding property would be free to choose between defending and securing their own property and income streams or voluntarily contracting with the security and insurance companies for these services.

In a Truly Capitalistic society, the division of labor would flourish and the property and resources would quickly pass from unproductive hands to productive hands, organically balancing the competing goals of maximizing output and capital preservation.

Companies who abuse their clients would quickly be abandoned and weakened while those who deliver the best service and value to their clients would prosper and attract more clients.  This rule naturally applies equally to security and insurance companies in stark contrast to the monopoly on these services currently claimed by the Nation State.

The lack of compulsion under the threat of violence is the key difference between the response of True Capitalism and Might Makes Right.  Might Makes Right naturally engenders fear and evokes a response to others based on this fear.  True Capitalism engenders, encourages, and rewards trust and evokes a response of trust in others.

Only upon this trust can a truly free and prosperous society blossom.

The choice between True Capitalism and Might Makes Right is one which must be made.  Anarchy demands a response, and these two options are the only responses known to man.  All other supposed choices are simply points on the spectrum between these extremes, but the choice of guiding ideology determines where man and society are moving along this continuum. 

The ideologies of True Capitalism and Might Make Right are like magnets, and remaining at a point in between them on the continuum is not an option, for society is always being pulled in one direction or the other depending upon the dominant ideology adopted by a majority of the people.

This is an ideological battle which must be won if mankind is to survive and prosper.  Life and death are laid before us.  Choose life, that you may live.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 9, 2011

Copper Price per Lb: $3.44
Oil Price per Barrel:  $97.42

Corn Price per Bushel:  $6.61
10 Yr US Treasury Bond:  1.96%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,789 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  0.3%
Dow Jones Industrial Average:  11,936  

M1 Monetary Base:  $2,122,700,000,000 RED ALERT!!! THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,507,600,000,000 YIKES UP $1 Trillion in one year!!!!!!!