Voices for Reason

Syndicate content Voices for Reason
Updated: 7 min 5 sec ago

Businessmen vs. Pseudo-businessmen

Fri, 03/05/2010 - 22:35

In the Christian Science Monitor, Don Watkins and Yaron Brook draw on Atlas Shrugged to illuminate a crucial difference between two opposite kinds of businessmen in our economy:

The producers, such as Hank Rearden [a character in Atlas Shrugged], inventor of a new metal stronger and cheaper than steel, work tirelessly to create products that improve human life. The looters are basically pseudobusinessmen, like the incompetent steel executive Orren Boyle, who get unearned riches by getting special favors from politicians. Their business isn’t business, but political pull.

The CSM titled the piece “Apple vs. GM: Ayn Rand knew the difference. Do you?” It’s a good oped that sheds light on how government intervention in the economy distorts the behavior of businessmen.

Read the whole thing.

stock.xchg/barunpatro

Justice Holmes awakens

Thu, 03/04/2010 - 20:34

“On Jan. 21, poor Justice Holmes must have turned in his grave.”

So writes Mimi Marziani in the National Law Journal, lamenting the Supreme Court’s decision in Citizens United v. FEC, issued on Jan. 21, 2010. That’s the controversial case holding that corporations have a right to speak out on political issues without being censored.

What’s the connection with Justice Oliver Wendell Holmes, Jr., who died back in 1935? Well, Holmes spent much of his long career arguing against the idea that the U.S. Constitution is a bulwark of liberty, a barrier to governmental infringements on individual rights. So Marziani is right that Holmes, if he were alive today, would have dissented in the Citizens United case—just as he dissented more than a century ago in the case forever associated with his name, Lochner v. New York. (In that 1905 case, the Court struck down a maximum-hours law for bakers.)

 

In fact, Marziani says, there’s a direct parallel between the two famous cases. Citizens United, she asserts, is “Lochner’s 21st century equivalent.” Why? Because both cases were driven by a conviction that the Constitution should be interpreted where possible to protect people against the awesome power of government to violate their rights. Along with Holmes, Marziani believes that the Constitution is agnostic on the relationship between individuals and the state.

So, in the Citizens United dispute between government censors (which is how the Supreme Court described campaign finance regulators) and muzzled corporations, Marziani would have us believe that the Constitution has nothing to say, nothing to justify the Supreme Court in striking down the law. And she takes it for granted that invoking Holmes’s name will add luster to her position.

But as I argued last year in “Justice Holmes and the Empty Constitution,” Holmes’s status as a spokesman for the Constitution’s true meaning is as undeserved as it is dangerous. The more often “poor Justice Holmes” turns in his grave, the more likely it is that progress is being made toward a recognition that the Constitution is a framework for liberty.

Image: WikiMedia Commons

Hit the brakes on government health care

Sat, 02/27/2010 - 01:50

Nicholas Kristof gives us his best case for passing ObamaCare:

Critics doubt that the Senate and House bills would succeed in containing health care costs very much, and they may be right. It’s hard to know. But the existing system is a runaway roller coaster. Isn’t it prudent to try brake pedals even if we’re not sure how well they’ll work?

You’ve got to love likening a sprawling new government program to further bureaucratize, politicize and intervene in American health care to putting on the brakes.

No, Kristof, I don’t think it’s particularly prudent to expand government’s control over health care based on nothing but the blind hope it will work; I don’t think it’s prudent to approach any problem without understanding the nature of that problem.

A truly prudent course would start by challenging the false alternative between today’s crippled health care system and the bloated monstrosity that is ObamaCare. It would ask: what is the cause of the spiraling costs of health care? And it would discover that the reason health care is so expensive is because of decades of byzantine government regulations and medical welfare programs.

Far from putting on the brakes, ObamaCare would slam on the gas pedal, injecting more and more of the interventionist policies responsible for today’s crisis, and making it even more difficult to move toward a genuine cure: a truly free market in health care.

Currently reading: Nothing Less than Victory

Mon, 02/22/2010 - 10:48

In the modern era, it is common to hear people put forward the view that in war, “the pursuit of victory would necessarily create new grievances and guarantee an even more destructive conflict in the future.” We hear versions of that invoked all over the place — it is, for instance, central to the rationale for America’s nation-building strategy in Afghanistan. But this idea deserves to be questioned in light of empirical evidence. In his new book, Nothing Less than Victory, Dr. John David Lewis takes on that question (among others) from a historical perspective. He considers “six major wars in which a clear-cut victory did not lead to longer and bloodier war, but rather established the foundations of long-term peace between former enemies,” and looks at how and why those successes were achieved.

Over the last few years, I’ve had the opportunity of hearing Prof. Lewis present his analyses of major wars in history, and every time I’ve come away tremendously impressed with his scholarship. This book examines major conflicts in the ancient world (including the Greco-Persian Wars and the Theban Wars) as well as three episodes that may be better known today: General Sherman’s march through the American south during the Civil War; the lead-up to World War II; and the U.S. victory over Japan in 1945. My copy arrived recently, and I’m eagerly looking forward to seeing how he weaves together the threads of his argument.

Kudos to Prof. Lewis for bringing this important volume to light.

Here we go again

Fri, 02/19/2010 - 19:36

Do you know what Venezuelan strongman Hugo Chavez said the other day? He was speaking at a televised ceremony in his presidential palace. In the room were representatives of Chevron, the American oil giant, and other multinational oil companies. They had just signed on to invest billions of dollars to exploit oil in Venezuela’s Orinoco basin.

“Dear friends, partners, allies,” Chavez told the assembly, “you know you have all the guarantees of our Constitution and our laws.”

Really? And exactly how strong are those guarantees?

Chevron might want to ask ExxonMobil about that. Whatever Chevron’s reasons (or rationalizations) for going in, the record of Venezuela’s treatment of foreign companies speaks for itself. Less than three years ago, Venezuela nationalized massive oil facilities operated by Exxon and several other western companies. They all had signed agreements guaranteeing long-term concessions. Chavez just tore those up and tossed them away.

I call it theft by engraved invitation. I say “theft” because I reject the widespread view that a nation owns the natural resources within its borders and is therefore entitled to seize private assets; when a state like Venezuela seizes private assets, I think that should be regarded as a kind of theft. And I say “engraved invitation” in reference to the so-called contracts that western companies sign with eyes wide open, delivering their advanced technology—and the engineers and technicians who understand and operate it—to the custody of thuggish governments with long histories of seizing private assets whenever they please.

What would happen if companies like Chevron and ExxonMobil were to stand up and declare that nationalization is theft? What if they called upon their own government to issue similar condemnations? What if such companies ceased propping up the world’s failing socialist economies?

I’d like to see what would happen to Chavez and his ilk if they were deprived of victims.

Image: WikiMedia Commons

Climate science unraveling

Thu, 02/18/2010 - 10:28

Following the Climategate scandal, I commented that on the climate issue “there has been a consistent pattern of exaggeration and deception, of context-dropping claims, and of distortion of the facts and the scientific process”—and that this has been driven by “a widespread commitment to environmentalist ideology.”

Well since Climategate, there have been so many other scientific scandals that have emerged it’s hard to keep up with them all. As the Wall Street Journal put it:

It has been a bad—make that dreadful—few weeks for what used to be called the “settled science” of global warming, and especially for the U.N. Intergovernmental Panel on Climate Change that is supposed to be its gold standard.

First it turns out that the Himalayan glaciers are not going to melt anytime soon, notwithstanding dire U.N. predictions. Next came news that an IPCC claim that global warming could destroy 40% of the Amazon was based on a report by an environmental pressure group. Other IPCC sources of scholarly note have included a mountaineering magazine and a student paper.

Here’s a round-up of the growing list of scientific distortions from the Orange County Register’s Mark Landsbaum.  So much for “The debate is over.”

Photo credit: flickr/azrainman

Are corporations creatures of the state?

Wed, 02/17/2010 - 20:55

In Citizens United v. FEC, the recent campaign finance case I discussed here and here, the Supreme Court noted that one of the arguments for restricting corporate speech is that “[s]tate law grants corporations certain advantages–such as limited liability, perpetual life, and favorable treatment of the accumulation and distribution of assets.” According to this line of argument, corporations are “creatures of the state” and they give up any claim to First Amendment rights in exchange for special state-granted favors.

In answer to this argument, the Court quoted a dissent by Scalia from a previous decision: “It is rudimentary that the State cannot exact as the price of those special advantages the forfeiture of First Amendment rights.”

The Court, which admirably upheld the free speech rights of corporations, took it for granted that corporations wouldn’t exist save for special favors from the state. It’s a common view of corporations. But it’s one that must be questioned.

There’s reason to think that all of a corporation’s essential features–”corporate personhood,” perpetual life, and limited liability–could arise by voluntary agreement among individuals on a free market, without a single government favor. Consider what many regard as one of the most controversial features of a corporation, limited liability.

Limited liability refers to the fact that a shareholder’s responsibility for the corporation’s debts is limited only to the amount of his investment in the company. Under limited liability, if you own a share of XYZ Corp’s stock and the company goes under, XYZ’s creditors can only go after your investment in the company, not after your personal assets. But that need not be a favor from the state. On a free market, a company could put a clause into its contracts stipulating limited liability, which anyone it dealt with would be free to accept or reject.

To be sure, there are difficult issues that would need to be thought about, such as how limited liability would apply in the case of torts. But free market answers to such questions are possible, and deserve to be discussed and debated. To wrestle with these kinds of issues, however, we’ll need to start from a premise that is totally alien to most commentators today: that free individuals can come up with innovative solutions to political and economic problems.

Image: flickr

Shut up, we want to regulate you

Fri, 02/12/2010 - 19:10

Jeff Scialabba and I have already addressed most of the substantive arguments Ralph Nader and Robert Weissman raise in their Wall Street Journal op-ed “The Case Against Corporate Speech” (see here, here, and here). But this is revealing:

Corporations know that money makes a big difference when it comes to blocking protections for workers, consumers and the environment. Wall Street, health insurance and drug companies, fossil fuel and nuclear power companies, and defense corporations have been hard at work defeating common-sense reforms that would make them more accountable.

Do we want more elected officials to believe that to challenge corporate agendas is to risk their career?

This means: “We should restrict corporate speech because it interferes with us passing our anti-corporate agenda.” As my colleague Onkar Ghate has pointed out, the same argument could have been made by segregationalists during the sixties: “We should restrict speech by blacks because it interferes with our anti-black agenda.”

Image: flickr

‘Heresy’ at Energy and Environment conference

Fri, 02/12/2010 - 11:52

Last week I spoke at the 13th annual Energy & Environment Conference and Expo in Phoenix. This is one the largest events in the U.S. devoted to energy and environmental issues, with over 650 speakers and more than 2300 attendees.

Marketing slogan: “650 speakers tackle solutions for USA’s energy independence and reducing carbon emissions.” Well, make that 649, because the gist of my presentation was to argue against the “solutions” that every other speaker had to offer.

As I told the audience attending my panel session, I was there to make the case for not doing anything about climate change—or, more specifically, for not imposing a massive regime of government controls, regulations, or market interventions aimed at restricting greenhouse gases in the name of allegedly fighting climate change.

Mine was definitely the most controversial talk on my panel session. I was even attacked as a “denier” by one of my co-panelists, the executive director of the American Solar Energy Society. But there were a number of people in the audience who came up afterwards to thank me for presenting a contrarian view that they felt was badly needed at this conference.

The audio of my presentation is not yet available, but it was based on this article, which presents my argument in detail.

The event was blogged and covered by the Heartland Institute for their publication Environment and Climate News. I did a pre-conference interview with Heartland’s James Taylor, available here (or via direct link to the mp3).

And I also did a video interview with Heartland’s James Lakely immediately following my panel session. Here’s the YouTube video of that:

Pivotal day in Iran

Thu, 02/11/2010 - 08:55

Thursday marks the 31st anniversary of the coalescing of Iran’s Islamist revolution. But on this deeply symbolic day, which Tehran usually spends glorifying its militant, tyrannical rule, millions of Iranian citizens will likely attempt another show of mass defiance and repudiation of the regime.

That’s precisely what Tehran fears. It fears having its veneer of popular endorsement torn away altogether. Witness its preemptive crack down. Critics and student activists have been rounded up and tossed in prison. Earlier this month, to build up the intimidation factor, the regime began executing dissidents. The IranTracker project is compiling a record of Tehran’s intimidation tactics in the run-up to the day. The list is horrifyingly long.

People in Iran have taken to the streets to protest before — notably after the elections of June — but an attempt to voice disapproval of the regime on Feb. 11 is particularly significant. It makes their rebuke of the regime all the more pointed.

And in protesting, many will be risking their lives to expose and oppose some of the evils of the regime that lords over them. We should encourage and support them (as I’ve argued before), and hope for their success in weakening, and ideally imploding, a regime that is hostile to America. Yet our leaders in Washington spend their time concocting myths about how the Iranian regime may, possibly have peaceable intentions for its nuclear program — despite a mountain of evidence to the contrary; how, if we’re kinder and gentler toward the regime, we could become friends — despite decades of anti-American violence directed by Iran.

Countless Iranians have shown that they recognize the evils — at least some of  the evils — of their regime. Isn’t it past time for our leaders to face up to the truly malignant nature of the regime and its campaign for subjugation under the Islamist banner?

flickr/Hamed Saber

The real root of political corruption

Wed, 02/10/2010 - 10:54

The recent Supreme Court decision in Citizens United v. Federal Election Committee knocked down long-standing restrictions on corporate and union contributions to political campaigns and was a definitive move toward the restoration of free speech in America. Yet many Americans are up in arms over the ruling, viewing the decision as an invitation for rampant corruption in Washington. While people are right to be concerned about political corruption, there’s a serious misunderstanding here about what gives rise to it and how it can be eliminated.

As Yaron Brook explained in a 2008 forbes.com op-ed, the problem is not the “allegedly corrupting influence on money on politics,” but rather subjecting “political speech to the corrupting influence of government control.”

It’s true that in a free system, money does give you a greater ability to get your message out; this is precisely one of the reasons it’s desirable to earn wealth. If this is what campaign finance advocates regard as corrupt, which system would they regard as uncorrupt? One in which a person’s ability to promote his viewpoint is unrelated to the financial resources he’s earned (whether personally or through voluntary contributions).

This is why campaign finance advocates have not been appeased by McCain-Feingold, and are calling for complete public financing of political elections. Under such a system, candidates would no longer have to financially earn the platform from which they speak; instead, the government would furnish candidates with your tax dollars. Of course, not every potential candidate could receive public funding under such a system: Only “serious” candidates would.

Who decides which candidate is serious? Those presently holding government power. There is no surer way to create a political aristocracy in America.

But what of the fear of corporations supporting politicians in exchange for favorable legislation? Isn’t that a form of corruption justifying restrictions on their freedom of speech? The real question is: Just who is corrupting whom? Brook again:

Can’t large contributions buy political favors? They can–when politicians have power to grant special favors to special interests in the first place. In today’s Washington, it’s not just money that purchases favors. Politicians dispense favors for the sake of prestige (say, their name on a bridge), for the purpose of appeasing vocal critics lobbying against them, for the attempt to win your vote (say, a pet project in your district that will create jobs), etc.

It’s not money that corrupts–it’s the lure of arbitrary political power. A true crusader against political corruption would not strip American citizens of their right to free speech; he would seek to put an end to the government’s power to grant special favors to any group.

Read the rest of the piece for a fuller exploration of the problems with campaign finance restrictions.

Image: euthman on Flickr

The green police

Wed, 02/10/2010 - 02:09

Did you see the “Green Police” Super Bowl ad? There’s some debate about whether the commercial is mocking the green movement, but I think blogger David Roberts makes a pretty good case that it isn’t:

[The ad is aimed] at people who acknowledge the moral authority of the green police–people who may find those obligations tiresome and constraining on occasion, who only fitfully meet them, who may be annoyed by sticklers and naggers, but who recognize that living more sustainably is in fact the moral thing to do. This basically describes every guy I know.

Of course, it’s not exactly reassuring that so many Americans don’t mind being bossed around in the name of environmentalism. Have Americans gone from the Revolutionary-era ethos of “Don’t tread on me” to “Only tread on me if it’s for a good cause”?

Here’s ARC’s Keith Lockitch on why we should not acknowledge the moral authority of the green police.

image: stock.xchng/Plusverde

The freeze fraud

Mon, 02/08/2010 - 12:53

In the name of fiscal responsibility, President Obama is promising a spending freeze–at the record-high spending level he reached in 2009. This is like an alcoholic promising to “freeze” his drinking at 20 beers a night.

But even worse than the dollar amount–a total of almost $4 trillion, starting a year from now–is that Obama will not freeze or cut spending on the parts of our budget that most urgently need to be cut. While Obama pats himself on the back for “saving $20 million by stopping the refurbishment of a Department of Energy science center that the Department of Energy does not want to refurbish”–.0005% of the budget–he will not touch Social Security, Medicare, and Medicaid, which will cost $1.35 trillion this year. This is particularly egregious since these programs have catastrophic unfunded liabilities some estimate at upwards of $100 trillion.

President Obama wants to pretend that he can meaningfully freeze or cut spending without rolling back the welfare state; he can’t. It’s time for all of us to face the reality that celebrated wealth-transfer programs such as Social Security are robbing the present and future of productive, responsible Americans.

stock.xchg/KeRmo

Turning of the tide on Iran policy?

Thu, 02/04/2010 - 11:53

Over at AEI’s blog, Danielle Pletka detects signs that the Obama administration is changing its approach toward Iran. After getting nowhere with attempts to lure Iran into negotiations, suddenly “the administration has started pouring it on from all spigots: sending Patriot batteries to Qatar, the UAE, Bahrain, and Kuwait, lengthening deployments to the Gulf, and otherwise talking up the stakes. So what’s the deal? Is Iran a major threat to the United States and our allies? Did this suddenly dawn on the administration?  . . . Hint: Something has changed. Second hint: It’s not Mahmoud Ahmadinejad. About time too.”

Allow me to register a dissenting perspective.

Obama’s so-called diplomatic outreach has treated Iran as a morally worthy interlocutor and estranged friend, whose goodwill it is our duty to cultivate. And that entire initiative is predicated on evading Iran’s bloody record and militant ideal of global Islamist rule. It’s a long way to go from that to a clear-eyed recognition of the regime’s character.  Obama would have to do, and publicly say, a lot more to convince me — let alone convince Tehran — that the administration now views the regime as fundamentally hostile and is willing to use military force to eliminate the threat it poses. Everything our president has done since taking office has reinforced the contrary view.

stock.xchg/g-point

Celebrating Ayn Rand’s 105th birthday

Tue, 02/02/2010 - 10:26

 

In honor of the 105th anniversary of Ayn Rand’s birth (February 2, 1905), I’d like to recommend Jeff Britting’s short but surprisingly comprehensive biography, Ayn Rand. Lavishly illustrated with items from the Ayn Rand Archives (a special department Britting manages within the Ayn Rand Institute), this biography is especially valuable because it pays close attention to the mental choices and processes by which Ayn Rand shaped her own character and ideology.

Britting’s biography traces Rand’s brilliant successes to the fundamental choices she made—choices about how to manage her own thinking and action. It started in early childhood, Britting observes, with a vigorously questioning attitude “aimed at understanding the things around her.” (p. 4) As she entered her teens, she “began asking why she liked what she did and, as a result, she began integrating her ideas into wider generalizations. She called this approach to integrating ideas ‘thinking in principle.’” (p. 13)

This allowed her, while still a teenager residing in St. Petersburg, to assess the unfolding Russian Revolution and its communist leaders. Britting writes:

For Rand, the Communist motto, “from each according to his ability, to each according to his needs,” meant that man should live for the state and not his own personal happiness. The revolution was her first confrontation with the “ethics of altruism” (the view that service to others is the highest moral virtue), which she rejected instantly as an attack on men of “intelligence, ability, and heroism.” (pp. 14-15)

It was this careful type of thinking over many decades that enabled Rand, as a mature philosopher, to identify the moral base of capitalism in an ethics of rational self-interest.

Britting’s analytical method focuses on how people choose to think and act, within the historical context in which they find themselves. Ultimately, this is the only way to explain how one young girl could emerge from the brutality of Soviet Russia to write a great novel championing capitalism, defining in the process a philosophy of reason that clashed with every irrationality she had endured in her childhood.

The coming inferno?

Fri, 01/29/2010 - 22:47

Ben Bernanke won a second four-year term at the head of the Federal Reserve yesterday with a 70-30 vote in the Senate. Alex Epstein pointed out the absurdity of reconfirming Bernanke on foxnews.com. Bernanke is among the individuals most responsible for the financial crisis, and he hasn’t changed his financial philosophy in the least. Yet nearly three-quarters of the Senate—and President Obama—think he saved us from disaster. To use one of Alex’s metaphors, we just elected the arsonist to put out the fire.

Image: Gage Skidmore on Flickr

Obama v. the First Amendment

Fri, 01/29/2010 - 22:27

Last week’s Supreme Court ruling, which struck down restrictions on certain kinds of political speech by corporations, was a profoundly important decision. Not only did it eliminate the most odious parts of McCain-Feingold, but it did so largely for the right reasons. In particular, the Court recognized that a corporation is an association of individuals, who retain their First Amendment right to free speech. I highly recommend reading the decision in its entirety.

The decision couldn’t have been more timely. The purpose of the First Amendment is to protect our ability to communicate our views without interference by the government. Politically, it is, as James Madison called it, “the only effectual guardian of every other right.” By enabling us to freely criticize our leaders, it is the best and last defense against the threat of unlimited government power.

As this blog has argued at length, Obama has been making an alarming grab for power since the day he entered office. He has shown nothing but contempt for economic freedom and limited government–and now he is seeking to silence those, corporations in particular, who challenge him.

In a statement released the day of the decision, Obama complained: “It is a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.”

Obama was condemning “powerful interests,” while claiming for himself and his colleagues the awesome power to decide who can speak during an election. In Obama’s universe, he should be free to use his unmatched megaphone to push his agenda, but corporate executives and shareholders should not have the right to speak out in opposition to it.

In our universe, however, the President’s job is not to bully Americans and American corporations. His job is to protect our rights by executing the nation’s laws and upholding the Constitution. And it is the job of the Supreme Court to interpret the Constitution. That makes Obama’s response to the Court’s decision all the more disturbing.

According to Obama’s State of the Union address: “With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests. . . . I’d urge Democrats and Republicans to pass a bill that helps to correct some of these problems.” If that weren’t clear enough, Vice President Biden said of the Court’s ruling, it “was dead wrong and we have to correct it.”

This is brazen defiance of the rule of law. The President and Congress do not get to “correct” the Court’s interpretation of the Constitution. They do not have the power to pass laws the Court has found violate the First Amendment rights of Americans. Someone should tell the President that saying “with all due deference to separation of powers” does not by itself constitute due deference to separation of powers.

Now, more than ever, we need to protect our right to speak out against government power. Thankfully, the Supreme Court made a significant step toward securing that right.

State of the Union in one sentence

Thu, 01/28/2010 - 18:59

We need to rise above fear, hesitation, and partisan politics–to give the government all the power it needs to solve all our problems.

That was the message of President Obama’s State of the Union address, which named dozens of problems in America and not once suggested that individual rights, liberty, or freedom were the solution.

From a quick reading of the speech, some statistics:

  • Number of times President Obama said “I”: 105–mainly pushing for the government programs he seeks to pass.
  • Number of times President Obama said “individual rights”: 0.
  • Number of times President Obama said “liberty”: 0.
  • Number of times President Obama said “freedom”: 1–but it was freedom for Afghanistan.

flickr: Darwin Bell

Barney Frank should quit his day job

Tue, 01/26/2010 - 10:53

For years, Barney Frank has been the most prominent cheerleader of Fannie Mae and Freddie Mac–the colossal failures that have cost taxpayers $110 billion to date. Frank has long denied any problems with the government sponsored entities designed to “promote home ownership” by making or guaranteeing loans the free-market wouldn’t.

“These two entities—Fannie Mae and Freddie Mac,” he famously said, “are not facing any kind of financial crisis. The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Frank also explicitly endorsed the reckless lending that proved Fannie and Freddie’s downfall: “I want to roll the dice a little bit more in this situation towards subsidized housing. . . .

Last week, Barney Frank changed his mind: “The remedy here is…as I believe this committee will be recommending, abolishing Fannie Mae and Freddie Mac…”

But don’t celebrate just yet. Frank didn’t call for a meaningful abolition–he called for “abolishing Fannie Mae and Freddie Mac in their current form and coming up with a whole new system of housing finance” (emphasis mine).In other words, there is nothing inherently wrong with government housing entities, like Fannie Mae and Freddie Mac, which subsidize mortgages and manipulate the market at taxpayer expense. It’s just that we didn’t do it the right way last time. But now we’re going to “come up with a whole new system of housing finance,” so Americans should rest easy.

The easy objection to all this is that Barney Frank, the veritable Ambassador for Fannie and Freddie, wants to lead the mission to create “a whole new system of housing finance.” And to be sure, if this were a valid mission, Frank would be one of the least qualified people on the planet to lead it. But it’s not a valid mission. No one has the right or qualification to dictate how homes are financed besides lenders and borrowers with their own money at stake. As I wrote in 2008,

Decisions about how best to finance mortgages should not be made by politicians or by editorial page columnists–they should be made by individuals in a truly free mortgage market, where lenders are free to lend as they choose and reap the full consequences of their decisions. The problem with the current system is not that borrowers and lenders have been unaware of more sensible financing options, but that implicit bailout guarantees have made reckless, short-sighted lending options more appealing. Abolishing the housing welfare-regulatory apparatus is the only “fundamental reform” that will do.

flickr: seier+seier+seier

Baksheesh Diplomacy [U.N. edition]

Mon, 01/25/2010 - 23:55

Later this week world leaders and diplomats will meet in London to discuss the situation in Afghanistan. In my earlier post I talked about the U.S.-Afghan drive to appease the Taliban; now, in the lead-up to the international conference, the NYT reports:

The leader of the United Nations mission here [Kabul] called on Afghan officials to seek the removal of at least some senior Taliban leaders from the United Nations’ list of terrorists, as a first step toward opening direct negotiations with the insurgent group.

What’s next, a plea-bargain for Osama bin Laden? That’s crazy talk, yes. But on 9/12/01, erasing Taliban fighters from terrorist watch lists would have sounded outlandish, too. Here we are, though, eight-plus years later, currying favor with enemies we have failed to defeat in the hopes they’ll deign to talk to us.