The Russian Empire

Posted by PITHOCRATES - February 11th, 2014

History 101

The Europeans built Larger Ships and used Advanced Navigational Skills to sail from Europe to the Far East

The Anatolian peninsula (roughly the area of modern day Turkey) has long been a trade crossroads.  It’s where the Black Sea (and the rivers into Europe and Russia) met the Mediterranean Sea.  It’s where Europe met Asia.  Where East met West.  All important long-distant trade traveled through the Anatolian peninsula.  Right through the Bosporus.  The straits between East and West.

The Greeks, the Persians, the Romans and the Ottoman Turks all coveted this region.  When the Western Roman Empire fell the great Italian city-states rose.  They dominated the Mediterranean.  And the trade through the Bosporus.  Where the Silk Road for centuries brought riches from the Far East into Europe.  The Italian merchant banks controlled that trade.  Until the Eastern Roman Empire (the Byzantine Empire) fell to the Ottoman Turks.  Which, lucky for the Europeans, happened at the time of the Renaissance.  Bringing an end to the Middle Ages.  And ushering in the modern era.

It started in Italy.  And then spread into Europe.  A rebirth (hence Renaissance) of all that Greek learning.  Which shifted the trading center from the eastern Mediterranean to Europe.  Where the Europeans built larger ships and used advanced navigational skills to sail from Europe to the Far East.  Bypassing the Silk Road.  And the Ottoman Turks in the Anatolian peninsula.  Making the Europeans the new rich traders.  Knowledge and wealth created more ships for trade.  And advanced armies and navies.  Making the Europeans the masters of the world.

Peter the Great pulled Russia out of the Middle Ages by making it more European

While the Mediterranean and European nations were ushering in the modern world not all of Asia followed them.  Russia in particular remained in the Middle Ages.  A vast land full of disparate peoples.  Not a unique and singular Russian people.  Until Ivan the Terrible came along.  The Grand Prince of Moscow from 1533 to 1547.  Then Tsar of All the Russians.  Ivan the Terrible united Russia by conquering it.  But at a cost.  Continuous wars killed a lot of Russian people.  Which left a lot of farmland fallow.  Giving Russia a chronic problem they would have for centuries.  The struggle to feed themselves.

Tsar Peter the Great (1682 – 1725) modernized Russia.  To be a more modern country like those in Europe.  He even went to Europe incognito to learn as much as he could about advanced European ways.  And had Europeans help him pull Russia out of the Middle Ages.  He made his army to be like European armies.  Learned about shipbuilding.  And built a Russian navy.  Which was a problem as the only access to the sea Russia had was the Arctic Ocean via the White Sea.  Which meant, of course, war and conquest.  He fought the Swedes for access to the Baltic Sea.  And he fought the Ottoman Turks for access to the Black Sea.

The disparate people of Russia were not all that happy with his ideas or the money he spent.  So he brutally suppressed any discontent.  Peter built his navy.  And a new capital on the Baltic Sea.  Saint Petersburg.  A European cultural center.  And the Imperial capital of Russia.  He also attacked the Ottoman Empire.  And lost.  Losing his Black Sea ports.  But Russia would return to fight the Ottoman Turks.  Under Catherine the Great.

The Bolsheviks killed Tsar Nicholas and his Family and ushered in the Oppressive Soviet Union

Catherine the Great ruled during Russia’s Golden Age.  Continuing the work started by Peter the Great to modernize Russia.  Making Russia a great European power.  Through military conquest.  And diplomacy.  She was even an international mediator.  And established the League of Armed Neutrality to protect neutral shipping from British attacks during the American Revolutionary War.

Catherine pushed Russia’s borders out largely at the expense of the Ottoman Empire.  And the Polish–Lithuanian Commonwealth.  These conquests cost, though.  And she turned to the nobility to pay for them.  In return she supported the nobility.  But the wealth she got form the nobility came from the serfs (basically slave laborers) working their land.  Which took a lot of work to pay for her conquests.  Leading to a peasant uprising or two.  But serfdom would continue in Russia.  Tsar Alexander I advanced the status of Russia with his defeat of Napoleon.  They even called him the Savior of Europe.  But serfdom remained as the Industrial Revolution took off in Europe.  Halting the modernization of Russia.

Tsar Alexander II emancipated the serfs in 1861.  Ending the landed aristocracy’s monopoly of power.  Serfs left their lands.  And moved into the cities.  Selling their labor.  Industrializing Russia.  Still, their freedom favored the landed aristocracy.  Who were compensated for their serfs’ freedom with a tax paid by the freed serfs.  Which little improved the life of the freed serfs.  And did little to ease the revolutionary fervor long simmering in the Russian people.  Especially those outside the nobility.

When Tsar Nicholas II entered Russia into World War I things did not go well for Russia.  Military losses, food shortages, fuel shortages, inflation and striking factory workers made the nation ripe for revolution.  Tsar Nicholas went off to command the Russian Army personally.  Leaving his wife Alexandra to run the country in his absence.  Who turned to Grigori Rasputin for help.  Which didn’t help quell the revolutionary fervor simmering in the Russian people.  They didn’t like Rasputin.  Or the Tsar.  And made Tsar Nicholas the last emperor of the Russian Empire.  Which the Bolsheviks made permanent.  By killing Nicholas and his entire family.  Which ultimately ushered in the Soviet Union.  One of the most oppressive regimes of all time.

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Is the Road to National Health Care through Incompetence or Deviousness?

Posted by PITHOCRATES - December 19th, 2013

Politics 101

The American Left is always trying to Expand the Role of Government in our Lives

Hillary Clinton tried it.  When her husband was president.  Give us national health care.  But there was terrific blowback.  Because people didn’t want it.  For they were afraid it would take the best health care system in the world (it’s the United States the richest people in the world go to for their more serious health problems) and do, well, what Obamacare is doing to it now.

The American left is always trying to expand the role of government in our lives.  To make people more dependent on government.  Because once they are they will soon discover something very beneficial to the left.  They will learn that they need government.  And once they do they will keep voting for the party that promises to expand government ever more.

This is why the left so wants national health care.  For it makes people need government.  To stay alive.  And that pays big dividends at those annoying things that come around every 2 years that the left hates.  And thinks is beneath them.  Elections.

The Lesson the American Left learned from the Failure of Hillarycare was to Lie Better

Liberals are a bunch of elitists.  They think they are better and smarter than the rest of us.  Which is why they feel they have the right to tell us how to live our lives.  For in their eyes we’re just too stupid to know what’s best for us.  Much like the British nobles felt about their petulant North American colonists.  They’d have preferred we appreciated all that the Crown was doing for them.  Thank them.  And shut the hell up.  This is the mindset of the American left.

The British Crown did not like their American colonists questioning the established order of power.  Neither do liberals.  For they believe that they are a privileged class.  And should live under a different set of rules.  Like they continue to show us all the time as they implement Obamacare.  As they forced the majority of Americans to lose the health insurance, doctors and medicine they liked and wanted to keep waivers went out to those connected to the liberal ruling class.  And actual members of the ruling class.  Such as those Congressional staffers getting illegal subsidies for their gold-plated health care plans while ordinary Americans lost their bare-bones plans because the Affordable Care Act made them unaffordable.

Was this an unintended consequence of the Affordable Care Act?  Well, being that the promise that if you like your health insurance, doctors and medicine and wanted to keep them but now can’t as the year’s biggest lie, it makes one think.  If they lied why did they lie?  To do what was best for the American people?  Or was it because they learned a powerful lesson from the failure of Hillarycare?  That the people don’t want national health care.  So if that’s what you want you can’t tell the American people that.  No.  You lie to them.  Which is why President Obama and his fellow Democrats lied.  Because they knew the American people didn’t want the [deleted expletive] they were shoveling.

The American Left looks upon us with the same Contempt as the British Nobility looked upon the American Colonists

Originally the Affordable Care Act included a public option.  National health care for those who opted for national health care.  But this just didn’t pass the smell test.  For there were Democrats who had one of those nasty things they hated coming up.  An election.  And these Democrats knew that their constituents, though they voted Democrat, would not go for national health care in sheep’s clothing.  So they had to remove the public option from the bill.  For it was just too painfully obvious what their ultimate intentions were.  Which left them with Plan B.

People like their health insurance, doctors and medicine.  And you’re not going to usher in national health care when they have these things.  For they know that the VA and Medicaid (examples of national health care already in America) is second-class health care.  I mean, those rich people coming to the United States for their more serious health problems aren’t demanding to get into the VA or Medicaid programs.  So to get national health care you first have to destroy the private health insurance system.  And candidate Obama told the SEIU that it may take awhile (see The Fix Is In: From ObamaCare Set-Up To Single-Payer Solution by Larry Bell posted 11/26/2013 on Forbes).

“But I don’t think we’re going to be able to eliminate employer coverage immediately. There’s going to be potentially some transition process. I can envision a decade out or 15 years out or 20 years out…”

So is the disastrous rollout of the Affordable Care Act just incompetence?  Or is it part of a devious plan to get what they always wanted?  National health care?  By first destroying the private health insurance that gave people the health insurance, doctors and medicine they liked and wanted to keep?  If it’s incompetence that isn’t good for the American people.  For these same incompetent people will now be in charge of our health care.  With our lives literally hanging in the balance.  Or are they just devious?  Which also isn’t good for the American people.  For it means they look upon us with the same contempt as the British nobility looked upon the American colonists.  Who only cared about what was best for their privileged class.  And not the American people.

The problem the left has is one of timing.  Yes they hold the American people in contempt and believe they are privileged.  But because of elections they have to be careful about letting these truths out.  Because if they lose the Senate and don’t get the House back in the next election it could throw a wrench into their plans.  They need to destroy the private health insurance industry.  But doing so will make people hate them.  And vote against them.  So on the one hand they have to get people dependent on government as soon as possible.  To get them to need government.  But if they move too fast they may anger the people so much that they may lose in the upcoming thing a privileged class hates.  And thinks is beneath them.  An election.  Which may cause them to lose their power.  This is the dilemma the left faces in the rollout of Obamacare.  The degree to which they [deleted expletive] the American people.

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Little Ice Age, Protestant Reformation, Louis XIV, Enlightenment, Seven Years’ War, American Revolution and French Revolution

Posted by PITHOCRATES - November 28th, 2013

Politics 101

(Originally published August 30th, 2012)

King Louis XIV remained Catholic as Protestantism was Breaking Out in Europe and Britain

It’s been awhile since the last ice age.  In fact the last time we had a real ice age predated the first civilizations.  We still wore animal skins and hunted and gathered our food.  Long before we first farmed.  But it would get cool again.  Shortly after the Black Death (during the 1300s) it did get unseasonably cool.  So cool that we now call it the Little Ice Age (from 1350 to 1850 or thereabouts).  The glaciers didn’t cover Europe.  But it was cold.  And wet.  The spring took forever to change into summer.  While summer was quick to turn into fall.  Which led to short growing seasons.  Poor harvests.  Hunger.  And famine.

Martin Luther was no fan of the Pope.  Especially because of the indulgences he was selling.  A shortcut to heaven.  For those with money.  Which is what the Pope wanted.  Money.  For he was doing some costly renovations in Rome.  So in 1517 Martin Luther nailed up his Ninety-Five Theses to the church door demanding reform.  And kicking off the Protestant Reformation.  Well, the Catholic Church wasn’t interested in reform.  So Luther set up a new church.  With a new religion.  Protestantism.  A more plain religion.  With masses in the common language of the people.  Instead of Latin.  And no fancy things in the church.  No altars.  No stain glass.  No icons.  Just the word of God.  With over a thousand years of Catholicism already under their belt, though, a lot of people took offense to this.  And their offense offended the new Protestants.  So they went to war with each other for a few centuries or so over their religious differences.

King Louis XIV was one of the great French monarchs.  Under his rule France was the dominant European power.  The Sun King believed in the divine right of kings.  Absolute monarchism.  Doing pretty much as he pleased.  Which included a few wars.  And growing an empire with oversea colonies.  It cost a pretty penny.  And a lot of lives.  Louis remained Catholic as Protestantism was breaking out in Europe.  And in England.  For a couple hundred years or so England and France were bitter enemies.  Contesting colonial lands throughout the globe.  And defending the true faith.  Catholicism.  Or Protestantism.  The Catholic-Protestant battle lines stretched across Europe.  And to distant lands across the globe.  Including the New World.  Where they would both spend fortunes in waging war.

For the French the American War of Independence had nothing to do with the Americans

The Enlightenment, or the Age of Reason, gave the French Voltaire.  One of the great Enlightenment philosophers.  When Benjamin Franklin was in France the French were eager to bring two of the world’s greatest Enlightenment philosophers together.  And did.  The French also gave us the great Charles-Louis de Secondat, baron de La Brède et de Montesquieu.  The greatest influence on the Founding Fathers as they drafted our Constitution.  So there was some great thinking percolating in France.  Thoughts that focused on science and reason.  Not tradition and faith.  Even questioning some long-held beliefs about the Catholic Church, the aristocracy and the absolute monarchy.

Louis XIV built a great French empire.  The French seemed invincible.  Until Louis XV took over.  Who lost the Seven Years’ War to the British.  And saw French North America become British.  (And the Louisiana Territory go to Spain.)  That was tough having their eternal foe humiliate them.  The Protestant British.  It was a blow to French pride.  French commerce.  And French finances.  The near-perpetual state of war that had existed between Britain and France had cost both nations a lot of money.  The British decided to recoup some of that money by taxing their American colonies.  Which didn’t go over well with the Americans.  For unlike France the British had a constitutional monarchy.  Where the Parliament restricted the king’s powers.  That great institute of the people.  Which the Americans had no representation in.  Leading to their rebellion.  Because they didn’t like being treated like second-class subjects of the British Empire.  Which brought about the American Revolutionary War.

After the Americans defeated a British army at the Battle of Saratoga the French joined the Americans in their fight for independence from the oppression of a constitutional monarchy.  Which seemed rather odd being that the French at this time was still an absolute monarchy (though now ruled by Louis XVI).  Which was far more oppressive than the constitutional variety.  But for the French the American War of Independence had nothing to do with the Americans.  It had to do with French interests.  It was a chance to strike back at their eternal enemy.  The Protestant British.  And more importantly, when they won they could get back all their colonies they lost in the Seven Years’ War.

The French were Intoxicated with all of those Enlightenment Ideals and the American Win over an Oppressive Monarchy

The Americans won their independence.  But the French didn’t get anything they wanted.  All they got was a lot of debt.  To add to the enormous pile of debt they already had.  One of the French conditions for their alliance was that the Americans would not make a separate peace with the British.  Which is what the Americans did.  Why?  Because the French and the Spanish were conspiring against the Americans during the peace talks.  So they could expand their holdings in North America at the expense of the British and the Americans.  The French were even willing to trade American Independence away.  The British, who would rather have Americans on their former lands than the French or Spanish, made a separate peace with the Americans.

This act of diplomacy stunned the French.  For they had assurances from the American Congress that they would take the lead in the peace talks.  The Americans double-crossed them before they could double-cross the Americans.  This wasn’t supposed to happen in the world of European diplomacy.  Especially with rubes like the Americans.  But it did.  And the French were now in a world of hurt.  Broke.  And facing bankruptcy.  Desperately needing new tax revenue King Louis XVI called an Assembly of Notables.  The nobility and clergy.  But they didn’t want to pay any more taxes.  So the king called the Estates-General of 1789.  Which included the clergy, the nobility and everyone else (i.e., the Third Estate).

Meanwhile there was widespread hunger and malnutrition.  Poor grain harvests (in part due to the Little Ice Age) pushed the price of bread out of reach for many.  People were cold, hungry and poor.  In the Third Estate, that is.  For though they may have been suffering they saw that the nobility and the Catholic clergy were not.  In fact, they were living rather well.  Which inflamed the masses.  Who became intoxicated with all of those Enlightenment ideals.  And that American victory over an oppressive monarchy.  It got the people thinking.  That they didn’t need a nobility any more.  The Catholic Church.  Or a king.  And the people would get rid of these things.  For awhile, at least.  With something called the French Revolution.

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Racist Democrats and Desegregationist Republicans

Posted by PITHOCRATES - August 29th, 2013

Politics 101

The Way to Great Wealth in the South was King Cotton

At the recent 50th anniversary of Dr. Martin Luther King’s “I Have a Dream” speech most if not all of the speakers were liberal Democrats.  As if the Republicans were not welcomed there.  Funny.  As it was the Republicans who battled the Democrats to end slavery, Jim Crowe Laws and discrimination.

America’s original sin, slavery, was a part of the Old World southern planters did not want to give up.  It was very similar to the manorial system of Europe.  Where peasants were tied to the land.  On a manor.  Unable to leave.  Land that a rich landowner owned.  The lord of the manor.  Property and status were hereditary.  And the peasants at the bottom of the ladder had neither.

The lords belonged to the aristocracy.  The nobility.  They lived in glorious mansions.  Gave magnificent parties.  And enjoyed the best of everything.  Courtesy of owning land.  The peasants worked the land.  And produced the greatest wealth in the kingdom for their lord.  Food.  In the American South this soon became cotton.  King Cotton.  The way to great wealth in the South was growing cotton.  And the more slaves you had the more noble your life was.

The Founding Fathers wanted to Eradicate Slavery at the Time of the Founding

Things were different in the North.  Years of growing tobacco had depleted the land.  So they diversified.  Grew different crops.  And rotated the crops around.  This required a more specialized workforce as things changed from year to year.  And few farms grew one large cash crop anymore.  So they turned to paid-labor.  Which was more efficient.  So while the South held on to the Old World the North became more egalitarian.

The Founding Fathers knew that a nation based on all men being equal could not include the institution of slavery.  They wanted to eradicate it at the time of the drafting of the Constitution.  But that created a problem with the South.  At the time of the Founding their economy was dependent on slavery.  And because it was they had more slaves than the North.  So freeing the slaves would not only destroy their economy it would force the South to live in a biracial society that was unheard of at that time.  Nowhere in the world were there biracial societies.  Not to mention the fact that the freed blacks would outnumber the whites.  The very same whites that once brutally oppressed the blacks.

To form a more perfect union they needed the southern states.  Which they had to take as-is.  With the institution of slavery.  It was a bitter pill to swallow.  As some of these Founding Fathers, especially the ones that didn’t own slaves, were conscious of the history books that would one day be written.  As well as being truly opposed to slavery.  But the choice was a new nation with slavery.  Or no new nation.  And continued sectional disputes.  Even hostilities.  Making them ripe for European intrigue.  Especially from the Old World Empires who wanted to expand their empires into North America.

The Republicans Freed the Slaves, Fought against Jim Crowe Laws and Desegregated the South

So the Founding Fathers tabled the subject of slavery for 20 years.  Sure that in 20 years time the South would adopt paid labor as they did in the North.  Sadly, a great invention changed all that.  The cotton gin.  Which could process cotton faster than slaves could pick it.  King Cotton promised more wealth than ever before.  All you needed was a lot of slaves.  Dashing the hopes of the Founding Fathers.

Wealth.  Nobility.  Life was good for the privileged few in the South.  The planter elite.  The southern Democrats.  Who used the power of the federal government to return fugitive slaves.  Then bitched about the federal government after they lost control of it.  The planter elite brought the nation to civil war.  To preserve the institution of slavery.  To keep the Old World in the South.  To keep the nobility in the South.  With them sitting at the top of the aristocracy.  But then came the Republicans.  And Abraham Lincoln.  Who issued the Emancipation Proclamation.  Freeing the slaves in the states in open rebellion.  Then Ulysses S. Grant won the American Civil War.  The Republicans pushed for and ratified the Thirteenth Amendment.  Abolishing slavery and involuntary servitude.  Then Republican President Grant sent federal troops into the South to protect the freed blacks.  As the racist southern Democrats resisted integrating the freed blacks into the South.  Eventually passing Jim Crowe Laws.  Making the freed blacks a permanent underclass with the Democrats’ separate but equal status of the freed blacks.

Democrat Storm Thurmond has the record for the longest filibuster in U.S. history.  He talked for 24 hours and 18 minutes in his opposition of the Civil Rights Act of 1957.  For he wanted to keep blacks separate but equal.  The southern Democrats opposition to civil rights was so strong that it prevailed through JFK’s administration.  Who did nothing for civil rights lest he go against the powerful southern Democrats.  Despite all the Republicans did the Democrats kept the black man down in the South.  Dr. King fought against segregation in Albany, Georgia, in 1962.  And suffered brutal police oppression in Birmingham, Alabama, that same year.  Things were so bad during JFK’s administration that Dr. King helped organized the 1963 March on Washington.  Where he gave his famous “I Have a Dream” speech.  But real change would have to wait until Republican Richard Nixon became president.  Who implemented the first large-scale desegregation of public schools in the Democrat-controlled South.  And Nixon implemented the first affirmative action plan.  The Philadelphia plan.

Yet despite all of this the Democrats claim the title of champion of civil rights.  And dominated the 50th anniversary of Dr. Martin Luther King’s “I Have a Dream” speech.  Even though it was the Republicans who freed the slaves, fought against Jim Crowe Laws and desegregated the South.  While the Democrats fought them every step of the way.  Yet the Democrats are civil rights champions.  While Republicans are racists.  What’s wrong with this picture?

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Keynesian Economics is as Corrupt and Immoral as is Crony Capitalism

Posted by PITHOCRATES - May 5th, 2013

Week in Review

Before John Maynard Keynes came along the established economic thought was classical economics.  Those principles that made America the number one economic power in the world.  A sound money like the gold standard gave you.  Low tax rates to encourage economic risk taking.  Responsible government spending for only those things a federal government should be doing.  And only spending what that minimal federal tax revenue could pay for.  Little government intervention into the private sector economy.  And thrift.  People spending money very cautiously.  And saving as much as they possible could.  To save for the future.  While providing investment capital for businesses.

These policies made the United States the number one economic power in the world.  Laissez-faire capitalism.  Tried and proven for over a century in the U.S.  But then government got big in the beginning of the Twentieth Century.  The progressives came into the government.  And they needed a new way to lie to and deceive the American people.  And then came along John Maynard Keynes.  The answer to their dreams.  Whose Keynesian economics has destroyed nation after nation with his assault on classical economics.  And now debt crises from excessive government spending in the Twentieth Century have plagued Greece, Italy, Spain, Portugal, Ireland, the United Kingdom, Japan, the United States, and other nations that dared to embrace Keynesian economics.

President Obama’s economic recovery has been horrible because he embraces Keynesian economics.  He lied like a good Keynesian to the American people to pass his stimulus.  It did nothing.  As predicted by everyone that isn’t a Keynesian.  He continues to destroy the American economy with near zero interest rates.  Destroying our savings.  Creating stock market bubbles while the labor force participation rate falls to its lowest since the Seventies.  And caused the federal debt to soar to levels that we can never pay down.  Putting us on the road to Greece.  All because of the corrupt economic school of thought John Maynard Keynes gave us.  That governments everywhere are using to increase their size and power.  To elevate the government class into a new aristocracy.  That lives very well thanks to those people beneath them.  The working class.  That works longer while earning less.  Like the nobility and peasants of old.  And a little Orwellian.  As they built this upon a house of lies.  Beginning with changing the meaning of words (see Two Sides of the Same Debased Coin by Hunter Lewis posted 5/2/2013 on Ludwig von Mises Institute).

When we turn to Keynes’s economics, perhaps the most fantastic self-contradiction was that an alleged savings glut, too much supposed idle cash, could be cured by flooding the economy with more cash, newly printed by the government. Perhaps even more bizarrely, Keynes says that we should call this new cash “savings” because it represents “savings” just as genuine as “traditional savings.” That is, the money rolling off the government printing presses is in no way different from the money we earn and choose not to spend.

All this new “savings” enters the economy through the mechanism of low interest rates. At this point, Keynes further confounds his forerunners and elders by arguing that it is not high interest rates, as always thought, but rather low interest rates, that increase savings, even though we started by positing too much savings in the first place.

Keynes’s followers echo this even today. Greenspan, Bernanke, and Krugman have all written about a savings glut which is supposed to be at the root of our troubles, and have proposed more money and lower interest rates as a remedy, although they no longer call the new money “genuine savings.” They prefer quantitative easing and similar obscure euphemisms…

The General Theory does argue that interest rates could and should be brought to a zero level permanently (that’s pages 220–21 and 336)…

Keynesians hate savings.  They don’t want people saving their money.  They want them to spend every last dime.  And then borrow more money to spend when they run out of their own.  Because consumer spending is everything to them.  Spending is what drives economic activity.  And any money they save they don’t spend.  And drain out of the economy.  Which is why they want zero interest rates.  Or even negative interest rates.  To discourage people from saving.  For if you lose purchasing power when you put your money in the bank you might as well spend it now.  And generate economic activity.

This is, of course, a ‘live for the day and screw the future’ mentality.  For if people spend all of their money going out to dinner, buying new cars, going on more vacations, running up their credit cards, etc., that will create a lot of economic activity.  But when these people retire they will have to live like paupers.  Because they didn’t save for their retirement.  Even if someone loses their job and is out of work for a few months if they have no savings they will struggle to pay their mortgage or rent.  Struggle to put food on the table.  They will struggle to pay their utility bills.  And their credit card bills.  This is the problem of living as if your income stream will never end.  It sometimes does end.  And if you didn’t bank a rainy day fund you could find yourself suffering some extreme hardship as you can no longer afford to live like you once did.

Keynesians once called printed money ‘savings’.  Today they call tax cuts ‘spending’.  A little Orwellian doublespeak.  Change the meanings of words.  So they can fool the people into believing that the government printing money and depreciating the currency is the same thing as you working hard and saving for your retirement.  And not taking more of your hard-earned paycheck is irresponsible government spending.  The only government spending, incidentally, they find irresponsible.  This is a fundamental tenet of Keynesian economics.  Deceiving the people.  So politicians can continue to recklessly spend money they don’t have to buy votes for the next election.  And to reward their campaign contributors with the favors of crony capitalism.

These Romney advisors also, of course, believed in the fairy tale of borrow-and-spend stimulus. It is usually forgotten that Keynes assured us that each dollar of such stimulus would produce as much as twelve dollars of growth and not less than four dollars. Even the most ardent Keynesians have, of course, been unable to demonstrate as much as one dollar. How did Keynes know that you would get four dollars at least? He didn’t. He told the governor of the Bank of England, Norman Montague, that his ideas were “a mathematical certainty” but that was just a crude bluff.

What is empirically verifiable is that all debt, private or public, has been generating less and less growth for decades. In the ten years following 1959, the official figures say that you got 73 cents in growth for each dollar borrowed. By the time of the Crash of ’08, that was down to 19 cents. And I expect it was really negative by then and is deeply negative now.

Keynes lied.  But that lie sanctioned governments to expand into the private sector economy.  So they embraced the lie.  And continue the lie.  Because none of these politicians want to give up the good life and get a real job.  They like it the old fashioned way.  Before the Founding Fathers had to muck it up with their attacks on the nobility.  They like being part of the aristocracy.  To live better than any of the poor schmucks that work a 40-hour week.  They just want to take a percentage of that poor schmuck’s earnings for themselves.  Rub elbows with the beautiful people.  And laugh at the working class.

The idea that you can take a dollar from the taxpayer, run it through a costly bureaucracy that a portion of that dollar has to pay for and think you’re going to generate more than a dollar in economic activity is absurd.  By the time that dollar reenters the economy the government has skimmed so much off the top that any economic activity it generates is negligible.  Now compare that to how the taxpayer who earned that dollar spends it.  He or she spends a dollar out of that dollar.  Because they’re not putting it through a costly bureaucracy before they spend it.

Which begs this question.  If a wage earner gets more economic activity when spending that money why not let that wage earner keep more of his or her money to spend?  For each additional dollar they can keep they can generate another dollar of economic activity.  Not the 19 cents the government will be lucky to generate from it.  Ah, well, if they can keep their money they may just do something responsible with it.  Like save it.  Which Keynesians hate.  And the government won’t be able to skim at least 81 cents from each dollar if they don’t tax it away.  Which Keynesians hate even more.

The common theme [of Keynesian Economics] is that market prices don’t matter…

Is this, then, the essence of Keynesianism, its blind destruction of the price mechanism on which any economy depends, as Mises demonstrated? Yes. But there may be an even deeper essence…

For the Victorians, spending within your means and avoiding debt were not just financial principles. They were moral principles. Keynes, who was consciously rebelling against these same Victorians, described their “copybook morality” as “medieval [and] barbarous.” He told his own inner circle that “I remain, and always will remain an immoralist…”

So, in conclusion, when we strip down Keynesianism to its essence, the relationship to crony capitalism becomes even clearer. Crony capitalism represents both a corruption of capitalism and a corruption of morals. Keynesianism also represents both a corruption of economics and a corruption of morals. Crony capitalism and Keynesianism are just two sides of the same debased coin.

The price mechanism allocates scarce resources that have alternative uses.  Through the laws of supply and demand.  Guaranteeing that the people who most want a resource—and are willing to pay more for it than others—will get that resource.  While those who don’t want that resource as badly are not willing to pay the higher prices others are willing to pay.

This is capitalism.  This is what enables you to go out and buy the things you want.  Because the price mechanism has automatically allocated millions upon millions of resources in the economy to get them into the things people most want to buy.  Crony capitalism smashes this apart.  By distorting market forces.  With government fiat.  Which allocates those resources first to their close friends who, in return, favor their friends in government with generous campaign contributions.  Or gifts of gratitude.  While others must pay a higher price.  If they can even get these resources at all.  Which they might not be able to do if they don’t please someone in government who has power over these resources.

This is crony capitalism.  Corrupt.  And immoral.  Just as is Keynesian economics.  Unlike the classical economics that made this country the number one economic power in the world.  Thanks to the gold standard, low taxes, low government spending, little government intervention into the private sector economy and thrift.  Things that kept a government moral.  However hard they may try not to be.

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A Princeton Woman should Marry Young before the Best Guys find Someone Else

Posted by PITHOCRATES - April 6th, 2013

Week in Review

Princeton is a very liberal school.  An esteemed member of the Ivy League.  Those graduating are going to have very liberal political views.  They will join approximately 20% of the population that thinks like them.  For this liberal view is a minority view.  As well as a superior view.  At least so think the people who belong to this American aristocracy.  Where privilege and power go hand in hand.  As many Princeton graduates enter the halls of power in Washington.  Just like a nobility should.  And as is common in most nobilities this power elite tends to be male.  So a young woman at Princeton should try to marry one of her fellow classmates.  Before he becomes too rich and powerful and acquires a taste for younger women who are not their intellectual equals (see Princeton Alumna Susan Patton Urges Women to Snag Husband on Campus Before Graduating by ABC News Blogs posted 4/1/2013 on ABC News).

Princeton University alumna Susan Patton, who is a member of the class of 1977, is sharing some wisdom with female students, but not everyone is taking kindly to it…

“It was just intended to suggest to these women who are on campus today, again, keep an open mind. Look around you. These are the best guys,” Patton said…

In the letter, Patton also says although “men regularly marry women who are younger and less intelligent…ultimately it will frustrate you to be with a man who just isn’t as smart as you.”

These guys believe they are the best guys.  And they live life as if they are.  And enjoy the privilege of being in America’s aristocracy.  And most of those in an aristocracy don’t marry for love.  They marry to improve their social and power positions.  The old fashioned way.  And the Princeton girl that snags one of these guys will be lucky.  For if she waits another ten years or so to marry these same guys who are their intellectual equals will probably be looking at younger women.  Because that’s what rich and powerful men do.  Even when they are married.  As even JFK cheated on Jackie.

The liberal elite is a small sector of the population.  Which narrows down the field for a possible husband.  Especially if you’re a smart woman in a man’s aristocracy.  So it’s not bad advice.  Marrying young.  For they are already excluding all the men in that 80% of the population that doesn’t think like them.  Which doesn’t leave many men left for smart, liberal women in their thirties and forties to find someone to marry and raise a family with.  Which is apparently something women still want.  Even if they go to one of the most esteemed and liberal schools in the Ivy League.

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Political Right, Left and Center

Posted by PITHOCRATES - November 22nd, 2012

(Originally published December 8th, 2011)

The French Left wanted Radical Change and Launched the French Revolution

The terms Right, Left and Center go back to the French Revolution.  To the National Assembly.  Where people sat according to their political preferences.  Those who wanted to kill the king, the queen, the nobility, the clergy and pretty much anyone rich sat to the left of the president.  Those who wanted to maintain the monarchy and the established institutions sat to the president’s right.  Those who fell between these views sat in the center.

Why did the French Revolution erupt?  The people were starving.  Taxes were high.  And the government was trying to raise taxes again.  Because the government was drowning in debt.  From decades of war with their archenemy.  Great Britain.  And their financing of the American Revolution.  Where the British Americans were rebelling against the French’s archenemy.  Great Britain.

So France was a tinderbox.  To make matters worse for the monarchy was all that liberty talk of the Americans.  It was like a disease.  And it infected the French.  Who looked at the wealthy few.  The king.  The queen.  The nobility.  The clergy.  And then listened to their empty tummies rumbling.  The French Left wanted radical change.  And revolution.  The French Right said whoa now, let’s not act hasty here.  Yes we have some problems but our glorious French institutions have been around for centuries.  It’s in large part to them that France is great.

The Revolution to Topple a King ended with the Coronation of an Emperor – Napoleon

Well despite France’s great and glorious past the radicals got their way.  And blood ran in the streets of Paris.  Starting with the Storming of the Bastille.  The great medieval fortress housing prisoners of the realm.  The revolutionaries threw open the gates.  And freed all seven prisoners.  Being more a symbolic act than one of substance.  But this led eventually to a number of legislative assemblies.  A lot of blood.  Carnage.  And the beheading of King Louis XVI.  And his queen.  Marie Antoinette.  Eventually the seats on the right side of the National Assembly emptied.  As everyone moved to the president’s left.  Lest they be killed, too.

The revolutionaries aimed their wrath at anyone who was not supportive of the Revolution.  And even those whose support was only lukewarm.  They killed these enemies of the Revolution.  Or any other enemies that they conveniently identified as enemies of the Revolution.  Leaders rose.  And leaders fell.  Jean-Paul Marat.  Georges-Jacques Danton.  And Maximillien Robespierre.  All three were killed.  Charlotte Corday, a supporter of the Right, stabbed Marat in his bath tub.  Danton and Robespierre were guillotined.  Leaders of violence.  Victims of violence.  These members of the French Left.  Who killed and terrorized the people unlike the king they killed.  King Louis XVI.  Or the queen they killed.  Marie Antoinette.

Ultimately the French Revolution gave the world Napoleon.  And world war.  And the Revolution to topple a king ended with the coronation of an emperor.  For this opportunist ultimately had the biggest army.  Napoleon could consolidate his power.  Unlike Marat.  Danton.  Or Robespierre.  But Napoleon could.  And did.  Then he set out to create an empire.  Much like the kings that came before him did.

Those on the Right are Distrustful of those on the Left when they Talk about Egalitarianism and Fairness

Today the meaning of Left, Right and Center vary.  But, in general, those on the Right prefer the way things are.  Proven by time to work.  And those on the Left are never happy with how things are and want to change them to some new theoretical ideal that time hasn’t proven as a viable workable system.  Such as socialism.  And communism.  Generally referred to as ‘leftist’ systems.  And both are systems that have never worked.

Fascist Italy, Communist Russia and Nazi Germany were all new experimental systems to right all the wrongs of past governments.  And all three governments made their citizens’ lives worse with harsh police states.  With the state summarily executing enemies of the state.  Much like Marat, Danton and Robespierre did in France.  Many refer to Nazi Germany and Fascist Italy as right-wing states.  But both were fascist states.  Which was nothing more than a national socialism.  Which was a combination of socialism.  And nationalism.  These were people who wanted radical change.  Control over the masses.  And empire.  If these governments sat in the French National Legislation they all would have taken seats to the left of the president.

Leftists hate the rich and successful.  And want to confiscate their wealth for themselves.  Instead of trying to achieve wealth on their own merit.  Those on the Right are distrustful of those on the Left when they talk about egalitarianism and fairness.  Because they know what that means.  They are going to take their wealth via the power of government.  By a progressive tax system.  Inheritance tax.  Capital gains tax.  Surtaxes to punish success.  Regulatory laws and fees that increase the cost of doing business.  (As well as increases the prices of goods and services.)  Etc.

The Left champions the poor and downtrodden as they ascend to power.  But rarely have they helped the poor and downtrodden.  Only a select few in the party upper echelons ever live a better life.   For example, the Democrat Party launched a war on poverty in the Sixties and yet there is still poverty.  Despite a myriad of government programs that has exploded the size of government.  All headed by rich bureaucrats living better lives.  While the poor and downtrodden are still wallowing in poverty.  And we know this because the Left is constantly telling us this.  In their never ending quest to expand the size of government.

The center is somewhere between the Left and the Right.  It’s not really a group with core political beliefs.  But more of a group that that likes a little from column ‘A’.  And a little from column ‘B’.

Politics is a Procession – We tend to Start on the Left, Work our Way through the Center and End on the Right

Perhaps another way to look at this is those on the right being parents in a family.  Children of these parents who are now raising their own families are in the center.  And the young children who are still in college are on the left.

The young know little and have even less responsibility.  They like to stay out late, party, do drugs and have consequence-free sex.  They don’t like anything that restricts their good times.  Hence they are always hostile to authority.  Church.  Or state.  And their vote tends to lean towards anarchy.  Where anything goes.

The children starting their own families are slowly giving up the ways of their youth.  They are becoming established in their careers.  Raising children.  Which leaves little time for fun.  But they are hesitant to admit that they have become their parents.  So they hang on to some of their idealistic ways of their youth.  While starting to save for their kids’ college education.  And their retirement.  They even start going to church.  To get their kids started on the right foot.  And to try and keep their kids from doing everything they did when they were young.

The parents have worked long and hard.  They have a family.  And grandchildren.  They want the best for their family.  And a happy and secure retirement.  After playing by the rules all of their lives they don’t want to rock the boat now that they are so close to retirement.  So they are very pleased to stay with the proven ways of the past.  And prefer to help others at their church.  Rather than giving money to a leviathan government.

Politics is a procession.  We tend to start on the Left.  Work our way through the Center.  And end on the Right.  For we tend to grow less radical with age.  Because as we age we accumulate wealth and have far more to lose with radical change.

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2012 Endorsements: Abraham Lincoln

Posted by PITHOCRATES - October 25th, 2012

2012 Election

The Slave Owners were the Social Elite and Holders of Political Power Similar to the Aristocracy in European Feudalism

General Motors (GM) required a government bailout and bankruptcy protection because of rising labor costs that prevented them from selling enough cars at a price to cover their costs while being profitable.  Their problem goes back to FDR.  During the Great Depression his government placed a ceiling on wages.  To encourage companies to hire more people.  By paying more people less money instead of fewer people more money.  So businesses had to do something else to attract the best employees.  And the employee benefit was born.  Pensions and health care benefits.  That were very generous when there was no competition and car companies could sell cars at whatever price they chose.  But that wasn’t the case in the 21st century.  Competition put great cost pressures on those companies with rising health care and pension costs.  And the job bank paying for workers who didn’t work.  Until they could be put back to work.  Adding a lot of costs to each car.  And sending GM into bankruptcy.

Slavery as an economic model had a similar problem.  High costs.  Which goes contrary to the public perception that slave labor was free labor.  George Washington wanted to sell his slaves and hire paid-laborers.  Because his slave families had grown so large.  So he had a growing slave population.  But they all weren’t working.  The young children could not do the work of a young man in his working prime.  Nor could the elderly.  Or the sick or infirmed.  (Who he couldn’t sell along with the healthier and stronger ones in their families.  So he kept his slaves, keeping those families together.  Freeing them upon the death of his wife.  And including provisions in his will to help them integrate into free society.  Giving them some job skills to help them find gainful employment so they could care for their young, elderly, sick and infirmed.)  Yet Washington was feeding them all.  While the growing amount of food they ate couldn’t go to market.  As the years passed his costs went up and his revenue fell.  Just like at GM.  For both had long-term labor commitments that became more inefficient over time.  Which is why slavery was a dying institution in the United States.  The industrial North was slave-free.  As they used more efficient paid-laborers.  Drawing a lot of immigrants to those northern factories.  And slavery was dying out in the South.  Until the cotton gin came along.  Allowing workers to comb (separating the seeds from the fiber) huge amounts of cotton at a time.  Greatly opening the market for that labor-intensive cotton crop.

The typical image of the South in 1860 is endless plantations each with hundreds of slaves working the fields.  Which is wrong.  Most people worked a small family farm.  In fact, most of the Confederate soldiers who fought in the American Civil War came from those small family farms and never owned a slave in their life.  The actual numbers of large slaveholders will probably surprise you.  Approximately 0.84% of the southern population owned at least 20 slaves.  Only 0.05% of the southern population owned at least 100 slaves.  And the number of big plantations owning at least 500 slaves?  Twelve.  So it was a very small population that had a vested interest in the institution of slavery.  Yet the South seceded from the union over the issue of slavery.  Why?  Because of who those slave owners were.  The social elite and holders of political power.  The Planter Elite.  People similar to the aristocracy in European feudalism.  An Old World nobility.  The very wealthy few who ruled the South.  And for awhile they ruled the United States thanks to an unfair advantage they had in the House of Representatives.  Where they determined their representation by not only counting the free population but by counting every slave as 3/5 a free person as well.  And this southern nobility was determined to maintain their aristocracy.

Popular Sovereignty created a Bloodbath in Kansas as ‘Free’ and ‘Slave’ People raced there to Settle the State

Which was easier said than done.  Because of that industrial growth in the north attracting so many immigrants that they swelled the northern population.  Transferring control of the House from the South to the North.  Which left only the Senate (and the presidency) for the South.  As each state got two senators the race was on to admit free and slave states to the union.  Which didn’t really solve anything.  It only made the differences between the North and the South greater.  And intensified the bad feelings between the North and the South.  The North was full of abolitionist busybodies trying to tell southerners how to live.  While the southerners were a bunch of immoral slaveholders.  Bringing shame to the nation that was supposedly a place where all men were created equal.   Words enshrined in the Declaration of Independence.  Words written incidentally by a southern slaveholder.  It was finally time to address the nation’s original sin.

Congress passed the Missouri Compromise (1820) after Thomas Jefferson bought the Louisiana Territory from the French.  Adding a lot of new land to form states from.  The compromise prohibited slavery north of the border between Arkansas and Missouri (except in the state of Missouri).  They added new states in pairs.  A free state.  And a slave state.  Maintaining the balance of power in Congress.  Then came Kansas and Nebraska.  Both above the Missouri Compromise line.  Well, that meant two new free states.  And a change in the balance of power.  Which the South couldn’t have.  So Senator Stephen Douglas introduced the Kansas-Nebraska Act.  And the idea of popular sovereignty.  The idea of letting the people in these new states decide for themselves if they should be a free state or a slave state.  Creating a bloodbath in Kansas as ‘free’ and ‘slave’ people raced there to settle the state.  Fighting and intimidating each other so they would be the ones to vote on making Kansas free or slave.  It was anarchy.

Abraham Lincoln had reentered politics in 1854 to campaign for fellow Whig Richard Yates.  Who opposed the Kansas-Nebraska Act.  Democrat Stephen Douglas was making a series of speeches in Illinois.  In response to one of Stephens’ speeches Lincoln gave his Peoria speech.  In commenting on letting slavery into Nebraska and Kansas Lincoln said, “I hate it because of the monstrous injustice of slavery itself.  I hate it because it deprives our republican example of its just influence in the world—enables the enemies of free institutions, with plausibility, to taunt us as hypocrites—causes the real friends of freedom to doubt our sincerity and especially because it forces so many really good men amongst ourselves into an open war with the very fundamental principles of civil liberty—criticizing the Declaration of Independence, and insisting that there is no right principle of action but self-interest.”

If Lincoln were Alive Today he would Likely Endorse the Republican Candidates Mitt Romney and Paul Ryan

The fallout from the Kansas-Nebraska Act splintered existing political parties apart.  Created new ones that disappeared later.  And gave birth to the new Republican Party.  The party of George W. Bush, Ronald Reagan and Abraham Lincoln.  Who became the leading spokesman of the party.  The Republicans lost the 1856 presidential election but won majorities in most of the northern states.  Tipping the balance of power further away from the South.  When Lincoln won his party’s nomination to run for senator in 1858 he gave his ‘House Divided Speech’ saying, “A house divided against itself cannot stand. I believe this government cannot endure permanently half slave and half free. I do not expect the Union to be dissolved—I do not expect the house to fall—but I do expect it will cease to be divided. It will become all one thing, or all the other.”

When slave Dred Scott traveled to a free state with his owner his owner died.  Scott said he was then a free man.  The Supreme Court thought otherwise.  Saying that Scott was still a slave because neither Congress nor any territory legislature had the authority to change that.  Which meant no one could restrict the movement of slaves because no one had the right to restrict the movement of private property.  Thus opening all the new territories to slavery.  Making the South very happy.  While infuriating the North.  Who refused to enforce slave laws on the books like the Fugitive Slave Law.  A provision included in the Compromise of 1850 for the states’ rights South.  That called for the federal government to force northerners to return slaves or face arrest and penalties.  States’ legislatures in the North passed laws saying a slave living in a free state was a free man.  The Supreme Court struck down these laws.  Favoring southern states’ rights over northern states’ rights.  So the states just refused to help the federal government in any prosecution of a violation of the Fugitive Slave Law.  Then abolitionist John Brown’s failed slave revolt at Harper’s Ferry, Virginia, further angered the South.

Then came the 1860 presidential election.  That Abraham Lincoln won.  Which was the last straw.  The South lost both Congress and the presidency.  Worse, the new president, though not an outright abolitionist, opposed the expansion of slavery.  Leaving the South with one last option.  Secession.  Which they did.  Leading to the American Civil War.  Which the South lost because of everything they believed in.  For an Old World nobility just could not defeat a modern industrial power.  Lincoln won because he had modern factories building whatever he needed.  The northern economy was large and diverse providing war financing.  Railroads crisscrossed the North.  A large navy controlled the interior rivers and blockaded the southern ports.  Cutting off the South from the outside world and starving it.  When the South desperately pursued the British for recognition Lincoln issued the Emancipation Proclamation.  Making it impossible for Britain to ally itself with a nation fighting for the institution of slavery.

No president entered office with a heavier burden than President Lincoln.  Standing on principle he made the hard decisions.  Becoming the most hated sitting president of all time.  He did not look for an easy solution like every other politician had up to his time.  Only making the inevitable solution more costly.  And more painful.  He would do what had to be done.  Regardless the price he would pay.  Politically.  Or personally.  A cost so high that it made him a one term president thanks to an assassin’s bullet.  He didn’t base his decisions on the polls.  Or populist movements.  But on principles.  Drawn from the Constitution.  And the Declaration of Independence.  As well as the Bible.  So if he were alive today who would he endorse in the current election?  He would, of course, support his party.  Out of party loyalty.  And because it tends to stand on principle more than the Democrat Party.  Which often used an activist Supreme Court to get what they couldn’t get in the legislature.  Which tends to use populist movements and character assassination to advance their agenda.  Such as the so-called war on women to scare women into voting Democrat because they can’t persuade them to based on a successful track record in office.  Also, the Republicans are more pro-business and more pro-military.  Which gives you the ability to win civil wars.  And other wars.  As well as protecting US security interests around the world.  Maintaining peace through strength.  For anything was preferable to the hell he went through during the four long years of the Civil War.  And to have so much blood on his hands.  The war being so horrific because of a policy of continued failed diplomacy when there was simply no common ground.  He said that there was only one of two possible outcomes.  All free.  Or all slave.  And he was right.  But it took someone willing to be the most hated sitting president to have the courage to act to bring about the inevitable.  So if Lincoln were alive today he would likely endorse the Republican candidates Mitt Romney and Paul Ryan.  Not the party that wants to delay the inevitable by refusing to address the systemic problems of Medicare and Social Security.  And a growing welfare state.  Systems a declining population growth rate can no longer fund.  Because aging populations bankrupt nations with expanding welfare programs.  Just like an aging workforce can bankrupt a car company like GM.

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FT139: “The political debate has evolved from no taxation without representation to representation without taxation.” —Old Pithy

Posted by PITHOCRATES - October 12th, 2012

Fundamental Truth

Because the Romans debased their Silver Coin they Required the People to Pay their Taxes in Gold or in Kind

High government spending caused the fall of the Roman Empire.  When the Roman Empire no longer expanded through military conquest it could no longer use the spoils of war to pay for the cost of empire.  Which presented some fiscal problems.  As the empire was never bigger.  Covering most of the civilized world.  Which they needed to protect with a vast army.  And governed through a vast bureaucracy.  Both of which cost lots of money.  Lots and lots of money.

So how did they replace the spoils of war?  Taxes, of course.  Starting small.  And growing lager.  To pay for the cost of the expanding state.  Government bureaucrats.  City improvements.  Food for the poor.  Food for the army.  And, of course, the mighty Roman legions.  Later, as citizens avoided serving in the Roman legions, the Romans turned to hired mercenaries to guard the frontier.  And the problem with sprawling empires?  They have very long borders to protect.  And that ain’t cheap.

To help pay for all of this the Romans turned to some bad monetary policy.  In addition to taxation.  Because their tax revenue just wasn’t enough.  So they started debasing their silver coins.  Putting more and more lead into the coins.  And less and less silver.  But this caused another problem.  Inflation.  As the currency became worth less it took more of it to buy anything.  So prices rose.  Making the silver coin pretty much worthless for taxes.  So the Romans required that people to pay their taxes in gold.  Or in kind.  If you grew wheat you gave a percentage of your harvest to the state.  If you made shoes you gave a percentage of all the shoes you manufactured to the state.

A King ruled over the Landed Aristocracy who Lived the Good Life as long as they were Loyal to their King and paid their Taxes

As the tax burden grew small business declined.  Small farmers and manufacturers said enough was enough.  They were working more for the state than for themselves.  So they quit their businesses and worked for someone else.  Because it was easier.  But this caused another problem for the Romans.  No one was making the stuff the Roman Empire needed anymore.  Food and manufactured goods were becoming scarce.  Which made it difficult to maintain their armies on the frontier.  And to provide the massive welfare state in the cities.  So the Romans addressed this problem with new laws.

If you didn’t like working your farm or your business and giving all the proceeds to the state, tough.  You no longer had a choice.  And neither did your children.  If you made shoes you were going to continue to make shoes.  And when you no longer could make shoes your children would continue in the trade.  Those working on farms became attached to the land.  And could never leave.  Regardless of who owned the farm.  If you farmed you would forever farm.  As would your children born on that land.  Allowing the landowners to raise their crops.  And pay their taxes.

So this led to a few rich landowners.  And impoverished masses working the land.  Sound familiar?  This would evolve into European feudalism.  Medieval manors.  The landed aristocracy (the few).  Peasantry (the many).  And, of course, kings (the one).  The basis of medieval governance.  Lasting thousands of years.  Where a king would rise to rule over the landed aristocracy.  Who he allowed to live the good life as long as they were loyal to their king.  And paid their taxes.  The nobility received certain privileges for this arrangement.  While the peasantry considered themselves lucky if they didn’t die from hunger.  And everyone lived happily ever after.  If you were lucky enough to be the one.  Or the few.

Representation without Taxation allows Government to Spend as Irresponsibly as They Please

Up until the 1200s a lot of France belonged to England.  Or, rather, the English nobility.  The barons.  But King John changed all of that.  For he liked to do what kings are wont to do.  Conquer.  And he tried to conquer a lot.  Only he wasn’t very good at it.  He blew a lot of the nobility’s taxes on failed adventures.  And lost a large chunk of France in the process.  So the taxpayers, the ones bearing the brunt of the king’s follies, reigned in King John’s powers.  The barons made John place his great seal on Magna Carta at Runnymede in 1215.  Which didn’t do a whole lot at the time.  But it ushered in the era of representative government.  And taxation only with representation.

England would become a constitutional monarchy with Parliament to limit the power of the king.  To sit in Parliament you had to have skin in the game.  That is, you had to be a taxpayer.  For this was taxation with representation.  Where those paying the taxes had a say in how the government spent those taxes.  And only those who paid the taxes.  To keep governments from irresponsibly spending those taxes.  A new system of governance that changed the world.  One that once people experienced they demanded for themselves.  As the American colonists demanded.  When Great Britain wanted to tax the Americans even though they had no say in how the British government spent that money.  Something very un-English.  And something that would become very un-American (which led to American independence).

For awhile, at least.  For soon governments found a way to return to their dictatorial ways.  By getting around that annoying taxation only with representation.  Which governments found insulting to their privileged status.  For it galled them that they had to let these taxpayers limit their powers.  But what choice did they have?  Governments must take money from others to establish their nobility.  As it was no longer their divine right to take what they wanted.  Thanks to those barons in 1215.  And Magna Carta.  Which opened the sluice gates to a lot of limitations on absolute power.  But two can play at that game they found.

Their answer?  Representation without taxation.  Allow people to vote who have no skin in the game.  To help the government take what they want.  And to spend it as they wish.  By simply giving those who don’t pay taxes government benefits.  Who will always vote for those who promise to give them more government benefits.  And if you get enough people on these government benefits you can overcome any limitations the taxpayers try to enforce on you.  Currently in the U.S about half of the population pays no income taxes.  While the top 10% of all earners pay approximately 70% of all federal income taxes.  So you have approximately 50% of the population who pay no taxes voting on tax policy for the 10% who pay most of the taxes.  Allowing government to spend as irresponsibly as they please.  Like in pre-Magna Carta days.  Thanks to representation without taxation.

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American Revolution, French Revolution, King Louis XVI, National Assembly, Tennis Court Oath, Bastille, Guillotine and Reign of Terror

Posted by PITHOCRATES - September 6th, 2012

Politics 101

France was Staring at Bankruptcy while her People were Suffering Poverty and Hunger

Shortly after the American Revolution came the French Revolution.  Inspired in part by the American Revolution.  Whose spirit of liberty was infectious.  Some French even joined the Americans in their fight for liberty.  Such as Marie-Joseph Paul Yves Roch Gilbert du Motier, marquis de Lafayette.  Who was a general in George Washington’s army.  And who Washington looked on as a son.  America’s war was an expensive war.  And only through the generosity of Louis XVI, King of the French, did the Americans win their war.  Ironic, really, that an absolute monarch like Louis XVI would help the Americans break free from a monarchy.  But he did.  And saddled France with a tremendous war debt.

These are two things you don’t want to do if you’re a king.  Showing your people that you support the end of monarchy while denying it to your own people.  And making the French people pay for another people’s independence.  Through higher taxes.  And greater privations.  Things that tend to piss off a people.  It was a gamble for Louis.  For he didn’t believe in the American cause.  It was just a calculated bet.  The British had just recently defeated the French in the Seven Years’ War.  And the British took France’s North American territories.  Territories the French wanted back.  The American Revolution was their chance to rebalance the balance of power.  And get back at their hated enemy.  Great Britain.

Well that was the plan.  But it did not go as planned.  The Americans got wind of what the French monarchy was doing behind the scenes.  Which was even in discussions with the British to secure a peace that left the Americans subjects of the British Crown.  With a much smaller territory in the New World.  Leaving room for the French.  And their ally.  Spain.  An outcome that benefited neither the British nor the Americans.  So the British and the Americans made a separate peace.  One that favored their interests.  Not the French or the Spanish.  So Louis gambled.  He lost.  And he lost big.  The nation was staring at bankruptcy.  While her people were suffering poverty and hunger.  And what did these poor and hungry people see?  A very comfortable and well fed king, nobility and clergy.  This was the kindling just waiting for a match to light.

Montesquieu influenced the Declaration of the Rights of Man and of the Citizen as well as the U.S. Founding Documents

That match came in 1789.  And the lighting of that match began with Jacques Necker.  Comptroller-General of Finance for Louis XVI.  Who advised the king that the nobility and the clergy needed to pay more taxes.  And proposed restricting the power of the parlements.  The nobility and the clergy paid little taxes due to their tax exemptions.  While the poor were too poor to help with the financial mess France was in.  So the only hope of raising new revenue was the nobility and clergy.  Alas, the monarchy did not like his recommendations and fired him.  Enter Charles Alexandre, vicomte de Calonne.  Who advised the king that the nobility and the clergy needed to pay more taxes.  Facing opposition from the parlements for proposing unpopular policy Calonne got the king to summon the Assembly of Notables.  A group of notables (like Lafayette) who advised the king.  But the notables did not endorse Calonne’s plan.  So the king called the Estates-General to the Grands Salles des Menus-Plaisirs in Versailles.

The estates were representatives of the people.  There were three of them.  The clergy.  The nobility.  And everyone else.  The commoners.  That is, the Third Estate.  Who grew weary with the way things were in France and declared themselves representatives not of the Third Estate but of the people.  They called themselves the National Assembly.  A radical move.  The first of a lot of radicalism to follow.  Not liking the look of this movement Louis closed their meeting hall and posted a guard in front of the door.  So the National Assembly moved to an indoor tennis court.  And took the Tennis Court Oath.  Where they promised to write a new constitution before adjourning.  Others joined them.  From both the clergy.  And the nobility.

The weariness grew into agitation.  The people grew angry.  And everything the king did just inflamed their anger.  From the firing of Necker.  To the presence of foreign soldiers in Paris.  The people feared royal oppression.  And began rioting.  Paris was out of control.  Then the people stormed the Bastille for weapons and ammunition.  They released all seven prisoners.  And brutally murdered Governor Marquis Bernard de Launay.  The guy in charge of the Bastille.  Beheaded him.  And placed his head on a pike and paraded it through Paris.  Then they went to Paris city hall and brutally murdered the mayor.  Jacques de Flesselles.  Then the National Constituent Assembly (of the National Assembly) went to work on the Declaration of the Rights of Man and of the Citizen (1789).  Sort of a combination of the U.S. Declaration of Independence and the U.S. Bill of Rights.  Drawing heavily on the same great French philosopher of the Enlightenment the Americans did.  Charles-Louis de Secondat, baron de La Brède et de Montesquieu.

The People who Embraced the Declaration of the Rights of Man and of the Citizen unleashed the Reign of Terror

In America after the U.S. Bill of Rights was ratified by the states the nation went about its business.  With some bitter fighting between the Founding Fathers as they argued over what the new nation was going to be.  But this bitter fighting was of the verbal kind.  It wasn’t quite like that in France.  There they attacked the Catholic Church.  Seized its property.  And sold it to the highest bidder.  As France grew more radical.  Where the radicals sat to the left in the legislative hall.  And those supportive of the old ways and monarchy sat on the right.  Giving us the political terms ‘left’ and ‘right’.  Then the radicals turned against the monarchy.  Created a constitutional monarchy to restrict the king’s power.  Like they had in Britain.  As the monarchy was assaulted the royal family tried to flee France in 1791.  They were caught and returned to Versailles.  Where they were put under house arrest.

Then the violence escalated.  Food shortages continued.  Prices continued to rise.  King Louis and Marie Antoinette were guillotined in 1793.  Control of France fell to the Committee of Public Safety.  And new leaders rose up to take power.  Including the radical journalist Jean-Paul Marat.  Who was murdered in a bathtub by a woman in the opposition party.  Georges Jacques Danton escalated the bloodletting by unleashing the Reign of Terror.  Where anyone who was identified as an enemy of the people or was not quite enthusiastic enough about the revolution was sent to the guillotine.  He was pretty bad.  But then there was Maximilien François Marie Isidore de Robespierre.  Who was real bad.  In all during the Reign of Terror the Committee of Public Safety guillotined some 20 to 40 thousand people.  Including Danton.  And Robespierre.  Live by the guillotine.  Die by the guillotine.

The French overthrew their king quicker than the Americans overthrew their king.  But the Americans quickly won their peace.  Without killing 20-40 thousand of their people.  Or their king.  Whereas the French descended into anarchy.  Even executed their king.  Something that appalled George Washington.  For though his motives were wrong and the Americans just rebelled against a monarch of their own, Louis provided the greatest aid to the Americans in their revolution.  Which probably made it easier to maintain a policy of neutrality in the new war between France and Great Britain during the French Revolution and the Napoleonic wars that followed.  Even favor the British in that policy of neutrality.  For the vast majority of American trade was with the British Empire.  And all of the agreements the Americans made with France during their Revolution they made with King Louis XVI.  A man executed during the Reign of Terror.  A period where the rule of law was thrown aside.  By the same people who embraced the Declaration of the Rights of Man and of the Citizen.

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