Is this 1936?

But while the Justices continued to dance in 1936, the music had died

By David Bernstein

Before the ACA decision was announced, many liberal pundits warned that the Supreme Court was on the verge of repeating its mistake in 1936, when the Court revealed that retained a 5-4 majority hostile to broad regulation of economic activity.  These pundits suggested that if the modern Court invalidated the ACA, it would be repeating the mistake of its conservative New Deal-era predecessor.  The Court would then face a backlash of the sort that led to FDR’s Court-packing plan, and ultimately to the famous “switch in time that saved nine.”

Egypt Holds Its Breath

The junta certainly has no intention of abandoning its vast economic empire

by Omar Ashour

“You are the authority, above any other authority. You are the protectors, whoever seeks protection away from you is a fool...and the army and the police are hearing me,” said Egypt’s president-elect, Mohamed Morsi, to hundreds of thousands in Tahrir Square. A man imprisoned following the “Friday of Rage” (January 28, 2011) took the presidential oath in Tahrir on a “Friday of Power Transfer” (June 29, 2012).

But he almost did not.

Ten days earlier, on June 19, I was with a group of former Egyptian MPs in Tahrir Square. One received a phone call informing him that a senior Muslim Brotherhood leader was coming to announce that the group was being blackmailed: either accept the constitutional addendum decreed by the Supreme Council of the Armed Forces (SCAF), which practically eviscerated the presidency, or the presidential election’s outcome would not be decided in the Brothers’ favor. An hour later, the senior figure had not shown up. “The talks were about to collapse, but they resumed,” said the former MP. “Hold your breath.”

The Origin Of Money

Who should create the monetary medium?

by John Aziz

Markets are true democracies. The allocation of resources, capital and labour is achieved through the mechanism of spending, and so based on spending preferences. As money flows through the economy the popular grows and the unpopular shrinks.  Producers receive a signal to produce more or less based on spending preferences. Markets distribute power according to demand and productivity; the more you earn, the more power you accumulate to allocate resources, capital and labour. As the power to allocate resources (i.e. money) is widely desired, markets encourage the development of skills, talents and ideas.

Planned economies have a track record of failure, in my view because they do not have this democratic dimension. The state may claim to be “scientific”, but as Hayek conclusively illustrated, the lack of any real feedback mechanism has always led planned economies into hideous misallocations of resources, the most egregious example being the collectivisation of agriculture in both Maoist China and Soviet Russia that led to mass starvation and millions of deaths. The market’s resource allocation system is a complex, multi-dimensional process that blends together the skills, knowledge, and ideas of society, and for which there is no substitute. Socialism might claim to represent the wider interests of society, but in adopting a system based on economic planning, the wider interests and desires of society and the democratic market process are ignored.

This complex process begins with the designation of money, which is why the choice of the monetary medium is critical.

Like all democracies, markets can be corrupted.

Whoever creates the money holds a position of great power — the choice of how to allocate resources is in their hands. They choose who gets the money, and for what, and when. And they do this again and again and again. 

Chief Justice Roberts and His Apologists

Some conservatives see a silver lining in the ObamaCare ruling. But it's exactly the big-government disaster it appears to be

By JOHN YOO

White House judge-pickers sometimes ask prospective nominees about their favorite Supreme Court justice. The answers can reveal a potential judge's ideological leanings without resorting to litmus tests. Republican presidential candidates similarly promise to appoint more judges like so-and-so to reassure the conservative base.

Since his appointment to the high court in 2005, the most popular answer was Chief Justice John Roberts. But that won't remain true after his ruling on Thursday in NFIB v. Sebelius, which upheld President Barack Obama's signature health-care law.

Justice Roberts served in the Reagan Justice Department and as a White House lawyer before his appointment to the D.C. Circuit Court of Appeals and then to the Supreme Court by President George W. Bush. Yet he joined with the court's liberal wing to bless the greatest expansion of federal power in decades.

Germany Cries: "Europe Is Coming For Our Money"

Greece Promptly Obliges

by Tyler durden

"Greece is an exception in the Euro Zone" - Angela Merkel, December 9, 2011

"Exception from ESM Seniority only applies to Spanish aid" - Angela Merkel, June 29, 2012

It took about a year, but finally Germany, with a little assistance from Merkel on Friday morning, has figured it out. And is now blasting it on the front pages of its various newpapers:

Europe is coming for our money!

What else does Die Welt say:

When economic historians in a few years determine the turning point at which the euro zone turned into a debt community, they may refer to the last Thursday night. In those dramatic hours when Angela Merkel after massive pressure from Italian Prime Minister Mario Monti and Spanish Prime Minister Mariano Rajoy buckled - and agreed to an agreement whose scope is now very difficult to estimate.

Government Medical "Insurance"

Everyone has the right to free medical care, but there is, in effect, no medicine and no care

by Murray N. Rothbard

One of Ludwig von Mises's keenest insights was on the cumulative tendency of government intervention. The government, in its wisdom, perceives a problem (and Lord knows, there are always problems!). The government then intervenes to "solve" that problem. But lo and behold! instead of solving the initial problem, the intervention creates two or three further problems, which the government feels it must intervene to heal, and so on toward socialism.

No industry provides a more dramatic illustration of this malignant process than medical care. We stand at the seemingly inexorable brink of fully socialized medicine, or what is euphemistically called "national health insurance." Physician and hospital prices are high and are always rising rapidly, far beyond general inflation. As a result, the medically uninsured can scarcely pay at all, so that those who are not certifiable claimants for charity or Medicaid are bereft. Hence, the call for national health insurance.

But why are rates high and increasing rapidly? The answer is the very existence of healthcare insurance, which was established or subsidized or promoted by the government to help ease the previous burden of medical care. Medicare, Blue Cross, etc., are also very peculiar forms of "insurance."

Laissez-Faire Learning

The Emperor is still naked

by David Greenwald

As a teacher in a public high school, I am daily confronted with the lamentable realities of state-monopoly education. Student apathy, methodological stagnation, bureaucratic inefficiency, textbook-publishing cartels, obsessive preoccupation with grades, coercive relationships, and rigid, sanitized curricula are just a few of the more obvious problems, attended by the cold-shower disillusionment and gradual burnout among teachers to which they almost invariably lead.

While outcomes such as these are certainly tragic, the process that produces them is not exactly the stuff of Greek theater. There is no climactic battle, no cathartic denouement, no salvific moral lesson to be taken home when the curtain falls, and seldom are there any readily identifiable heroes or villains. It is not a single, epic calamity but a thousand trivial defeats a day, each too mundane and too quickly obscured by its successor to be considered noteworthy. Like a bad movie, public education somehow manages to be both tragic and boring. It is only its cumulative result that would have impressed Sophocles.

What's Wrong With ObamaCare?

Here's A Partial List

IDB Editorial

Repeal: After a full day's reflection, we still feel that the ObamaCare ruling is an outrage. And while we acknowledge that it's now settled law, we believe that it's poor public policy and needs to be expunged from the books.

We're still nettled by the Supreme Court ruling that ObamaCare's individual mandate can stand constitutionally as a tax when Congress failed to define the penalty for failing to buy health insurance that way. But we can do nothing about that. The court has spoken.

What we can do, with an eye toward repeal, is point out just how malignant the Patient Protection and Affordable Care Act is.

Intellectuals adore tyrants

Rating and Ranking Our Presidents

by Patrick J. Buchanan

In 1948, Arthur Schlesinger Sr. wrote for Life magazine a controversial article on a subject that has been the cause of spirited and acrimonious debate ever since. He listed the consensus of our academic elite as to which American presidents had been Great, Near Great, Average, Below Average and Failures.

Leading the list were Abraham Lincoln, George Washington and FDR. Below, but also among the Greats, were Woodrow Wilson, Thomas Jefferson and Andrew Jackson. The Near Greats were Theodore Roosevelt, Grover Cleveland, John Adams and James K. Polk.

In 1962, Schlesinger followed with a New York Times piece, also based on the responses of historians, political scientists and journalists. This list had the same top seven. But Jackson had fallen to Near Great and Polk, who took the Southwest and California away from Mexico, had risen from 10th to eighth.

Arthur Schlesinger Jr. and others have since produced their own rankings. The latest in the field is Robert Merry, a lifelong journalist and now editor at The National Interest. In "Where They Stand: The American Presidents in the Eyes of Voters and Historians," Merry adds a new criterion. Did this president win a second term, and was he succeeded by a man of his own party?

Camus and Sartre’s intellectual fisticuffs

Much ado about almost nothing

A fascinating and entertaining new book explores the fractious relationship between two of the twentieth century's most compelling intellects.

by Tim Black 

The Boxer and the Goalkeeper: Sartre Vs Camus. The title of a new book by Andy Martin, a dude-like don from Cambridge University, isn’t that promising. Neither is the subtitle: ‘They should have been a dream team. It turned into a duel to the death.’ And the cover, just to ram home the gimmicky, ‘prize bout’ theme, is mocked up like a 1950s boxing promotion.

Thankfully, The Boxer is not as naff as it sounds. In fact, Martin has produced a rather lovely, sometimes playful, sometimes moving and often very droll take on the life, loves and, yes, thought of two of the twentieth century’s most compelling intellects. The combative element is there, of course. And Martin certainly has fun pitting the two writers and thinkers against one another. Their ‘binary antagonisms’ seem to proliferate under Martin’s gaze: Jean-Paul Sartre the thinker versus Albert Camus the man of action; the lover of the symbolic versus the savage lover; the prolix writer versus the minimal stylist; and, of course, the ugly versus the beautiful. Lest we forget, Camus, eight years Sartre’s junior, was blessed with good looks. A young Humphrey Bogart, reckons Martin. Sartre, meanwhile, looked like ‘something hanging off the side of Notre Dame’.

Why Don't People Get It?

Facts will always be with us. Wisdom, however, must be taught

by Llewellyn H. Rockwell Jr.

Even now, people think nothing of professing their attachment to socialist ideology at cocktail parties, at restaurants serving abundant foods, and lounging in the fanciest apartments and homes that mankind has ever enjoyed. Yes, it is still fashionable to be a socialist, and — in some circles within the arts and academia — socially required. No one will recoil. Someone will openly congratulate you for your idealism. In the same way, you can always count on eliciting agreement by decrying the evils of Walmart and Microsoft.

Isn't it remarkable? Socialism (the real-life version) collapsed nearly 20 years ago — vicious regimes founded on the principles of Marxism, overthrown by the will of the people. Following that event we've seen these once-decrepit societies come back to life and become a major source for the world's prosperity. Trade has expanded. The technological revolution is achieving miracles by the day right under our noses. Millions have been made far better off, in ever-widening circles. The credit is wholly due to the free market, which possesses a creative power that has been underestimated by even its most passionate proponents.

What's more, it should not have required the collapse of socialism to demonstrate this. Socialism has been failing since the ancient world. And since Mises's book Socialism (1922) we have understood that the precise reason is due to the economic impossibility of the emergence of social order in the absence of private property in the means of production. No one has ever refuted him.

It's Up to the Voters Now

The last chance to stop ObamaCare is in November

By Paul Clement

If there is a modicum of hope in Chief Justice John Roberts's inglorious one-man opinion Thursday, it is that Americans were reminded again that they cannot count on others to protect their liberty. Certainly judges aren't reliable. They can be turned by the pressure of the media and the whims of vanity. If Americans want to repeal ObamaCare, their only recourse is to demand it at the ballot box in November.

The Affordable Care Act is more unpopular now than when it passed, yet it will grind on toward implementation in a second Obama term. The President made that clear in his remarks Thursday, deploying the usual half-truths he used to jam the law through Congress. He continued to claim that no one will lose his current health insurance, though millions are sure to do so as they are dropped from business coverage and tossed into Medicaid or government exchanges.

The Supreme Court And Natural Law

A tough but valuable lesson

by James Miller
I won a bet today.

A few weeks ago I wagered with a coworker that the United States Supreme Court would uphold the Affordable Care Act otherwise known as Obamacare.  He reasoned that the federal government has no authority under the Constitution to force an individual to purchase a product from a private company.  My reasoning was much simpler.  Because the Supreme Court is a functioning arm of the state, it will do nothing to stunt Leviathan’s growth.  The fact that the Court declared no federal law unconstitutional from 1937 to 1995—from the tail end of the New Deal through Lyndon Johnson’s Great Society—should have been proof enough.  He naively believed in the impartialness of politically-appointed judges.  For the first time he saw that those nine individuals are nothing more than politicians with an allegiance to state supremacy.

It was a tough but valuable lesson to learn.

The Big Blink?

Not Really

by Wolf Richter   

Markets soared in Asia, Europe, the US, everywhere. Let the good times roll. The euro jumped to the highest level in a couple of weeks. Yields on Spanish bonds plunged to the lowest level since, well, Monday. A miracle had happened. German Chancellor Angela Merkel had blinked. Um, a little bit.

All eyes were on her at the EU summit in Brussels, the one summit that would once and for all save the Eurozone, THE summit, where she’d be forced to submit to the majority of the Eurozone, and indeed to the majority of the world, and where she’d be forced to come to her senses and give in to the demands set out before the summit.

There was the Grand Plan, issued by European Council President Herman Van Rompuy. It included all the goodies: a European Treasury with power over national budgets and how much countries could borrow; Eurobonds; a banking union that would guarantee deposits; and the ESM that would bail out banks directly.

The Largest Theft Racket In World History

U.S. Entitlements

By Wendy Milling

Suppose that you were a police officer who moved in on a major theft racket that involved thousands of people. You arrest the perpetrators and question them, whereupon they nonchalantly tell you the secret incentive that drew hordes of loot-seekers into their racket.

They had agreed amongst themselves that new recruits would steal from victims on the outside and then turn the loot over to older members. The older members would assist the newer members in the commission of the thefts, and some of the loot would be used to buy off key law enforcement personnel, prosecutors, witnesses, and others in order to assist the racket or protect it from trouble. After a time, the newer members became older members entitled to take from the new recruits. The loot turned out to be larger in size than your state’s economy.

A Finalized Path to Full, Socialized Medicine in America

Thanks to Conservatives and George W. Bush 
By Richard M. Salsman

Once again American conservatives have struck a lethal blow against freedom, rights and capitalism. The U.S. Supreme Court’s 5-4 ruling today, condoning every sordid feature of the 2700-page, rights-violating “ObamaCare” law, ensures that America will move still farther and faster down the path to full, socialized medicine, a path first paved in the 1960s, with Medicare and Medicaid. The lawless ruling was made possible by the vote of Chief Justice John Roberts, an appointee of “compassionate conservative” George W. Bush.

With today’s ruling the U.S. government can do virtually anything it wishes to its citizens – liberty and rights be damned, without limit. Officially in America we now have a totally arbitrary and limitless government. That is, we have a “total government.” In short, we’ve got totalitarian government. As to how much further liberty we may lose in our lifetimes, it’ll depend only on how arbitrary and vicious reigning rulers choose to be, or not. There’s no real Rule of Law any more, only the Rule of Men – and these are mostly ignorant, reckless men.

The Truth About Healthcare

Medical care is a scarce good

By Douglas French

Nothing starts a fistfight like the health-care debate. The market for what is just a basic service has been contorted and mangled by government intervention for more than a century. The average person wouldn’t know a free-market health care system if they saw one.

“Life, Liberty, and the pursuit of Happiness” must include health care, say those on the political left. The alternative is barbaric, they claim. Never mind that someone else’s rights must be trampled upon in order to provide the “right” of health care. And never mind that the results will be seriously degraded for everyone but the elite.

But the political right is just as clueless. Who can forget the Tea Party member who protested loudly, “Keep your government hands off my Medicare!”

Yet another betrayal, from yet another "compassionate conservative"

A lie makes Obamacare legal

By mark steyn

Three months ago, I quoted George Jonas on the 30th anniversary of Canada's ghastly "Charter of Rights and Freedoms": "There seems to be an inverse relationship between written instruments of freedom, such as a Charter, and freedom itself," wrote Jonas. "It's as if freedom were too fragile to be put into words: If you write down your rights and freedoms, you lose them."

For longer than one might have expected, the U.S. Constitution was a happy exception to that general rule – until, that is, the contortions required to reconcile a republic of limited government with the ambitions of statism rendered U.S. constitutionalism increasingly absurd. As I also wrote three months ago (yes, yes, don't worry, there's a couple of sentences of new material in amongst all the I-told-you-so stuff), "The United States is the only Western nation in which our rulers invoke the Constitution for the purpose of overriding it – or, at any rate, torturing its language beyond repair."

‘Ordering Nature Around’ Some More and Why the EU May Break Apart

France Raises the Minimum Wage Rate
By Pater Tenebrarum

Crisis-stricken Greece had to cut its minimum wage by 22% in February this year – this was part of its agreement with the 'Troika' of lenders. For workers under the age of 25 the cut was an even bigger 32%.

Reuters at the time wistfully reported that this 'slashed the living standards of low-paid workers'. Presumably the author of the report would have rather seen them join the swelling ranks of the unemployed and retain a vague hope of a 'higher living standard' if their jobs ever came back.

Minimum wages raise no-one's living standard. They merely price unskilled workers out of the labor market. Not a single advance in living standards can be credited to so-called 'pro-labor' legislation – what raises real wages and living standards is the increase in capital per worker employed and the concomitant increase in economic productivity.

A Eurocrash is baked in the Cake

"All these hordes of Eurocrats should be summarily fired, and their agencies totally abolished"

In a pungent interview with Louis James, Doug Casey talks about the coming economic crash and how to survive it.

Louis James: So Doug, you're off to FreedomFest 2012 shortly, where people will be able to hear your latest thoughts on many subjects. Maybe you can give us a sneak preview on whatever is uppermost on your mind today. 

Doug: Lately I've been thinking about the EU's rising tide of troubles. We talked about this last January, when I said it was coming, but it seems to me that at this point it's rapidly coming to a head. A major financial and economic catastrophe in Europe is unavoidable. From there, it's likely to spread out to the whole world.