According to the Bureau of Labor Statistics, there were approximately 1,007,000 private security guards working in the [...]]]>

If all financing of government was voluntary, would anyone volunteer? The answer is: of course, if government were limited to its proper functions—the police, the courts, and the military. And you can see ample evidence of it everyday.

According to the Bureau of Labor Statistics, there were approximately 1,007,000 private security guards working in the United States in 2010. This is about 100,000 more than the number of police in 2008. According to the Department of Justice, Americans spend more than $100 billion per year on security alarms, security guards, and other security services, which is twice what is spent by federal, state, and local law enforcement departments combined. Clearly, Americans are voluntarily spending money in order to protect their property and persons. And this money is spent in addition to the taxes paid for the provision of police.

Many of the objections to the idea that government could exist without taxation arise largely because government has grown far beyond its proper purpose. Most taxpayers are rightly incensed when they hear of the many ways government wastes their money. Taxpayers understandably decry $600 toilet seats, programs that pay farmers to not grow crops, and welfare fraud. They correctly conclude that nobody would voluntarily support such wasteful spending.

With government limited to its proper purpose, all services except the police, the courts, and the military are provided by private companies. You are free to spend, invest, and donate your money as you deem best. If you believe that a business or non-profit organization is wasting your money, you are free to withdraw your support. In a capitalist society, if government officials insist on wasting your money, you are also free to withhold your financial support. Try doing that today.

As evidence, they cite the Reagan tax cuts, which reduced the top marginal rate from [...]]]>

Referring to Ayn Rand’s 1957 novel, Atlas Shrugged, economists Emmanuel Saez and Thomas Picketty are arguing that higher tax rates does not cause Atlas to shrug. That is, high tax rates do not cause the wealthy to work less hard.

As evidence, they cite the Reagan tax cuts, which reduced the top marginal rate from 70 percent to 28 percent:

The economy actually grew faster in the 30 years before that tax cut than it did during the following three decades, according to Diamond and Saez. Gross domestic product per capita advanced at an average annual 2.2 percent rate between 1950 and 1980, compared with 1.7 percent between 1980 and 2010, their calculations show.

Taken out of context, these statistic might seem to prove Diamond and Saez correct. But tax cuts do not occur in a vacuum. Other factors impact economic growth (further, economic growth is a misleading and essentially useless statistic). For example, regulations can have a huge impact on economic growth.

Regulations divert resources from production to compliance. Regulations force businesses to meet the demands of bureaucrats rather than the demands of the market. Instead of producing goods and services, regulations force businesses to produce government forms and secure government permission.

In the thirty years since the Reagan tax cuts, the number of regulations has exploded. In 1960, the Code of Federal Regulations (CFR) contained 22,877 pages. By 2007, the CFR had swelled to 145,816 pages, an increase of more than 530 percent. A report by the Competitive Enterprise Institute found that the cost of meeting federal regulations was $1.751 trillion in 2008. State and local regulations add another $446 billion in expenses to Americans each year. In total, the various federal, state, and local regulations impose on each person more than $6,600 per year in regulatory compliance costs.

Statistics can be useful. But statistics taken out of context are misleading and intellectually dishonest.

One example of the job-destroying nature of minimum [...]]]>

On CNN.com, Christine Ownes claims that raising the minimum wage will create jobs. Of course, she doesn’t explain how coercively imposing additional costs on businesses will lead to job creation, because no explanation is possible. The fact is, the minimum wage kills jobs on a massive scale.

One example of the job-destroying nature of minimum wage laws occurred in July 2009 when the minimum wage was increased from $6.55 to $7.25. A month before the increase, economist David Neumark wrote in The Wall Street Journal: “The best estimates from studies since the early 1990s suggest that the 11% minimum wage increase scheduled for this summer will lead to the loss of an additional 300,000 jobs among teens and young adults.” Nine months later, another economist, Casey B. Mulligan, wrote in The New York Times, that “part-time employment would have been about 500,000 greater in the last couple of months of the year if it hadn’t been for that last increase in the federal minimum [wage].”

By making it illegal to pay a wage below the minimum, minimum wage laws price many workers—particularly those with few job skills and less education—out of the labor market. Simply because Congress mandates a particular wage as a legal minimum does not miraculously endow workers with the skills that businesses need. If this were the case, then why doesn’t Congress mandate a minimum wage of one hundred dollars per hour and legislate the nation into prosperity?

The American Association of Acupuncture and Oriental Medicine is now lobbying the Department of Health and Human Services to have [...]]]>

As ObamaCare gets closer and closer to implementation, the moochers are lining up to get a piece of the pie. We’ve already seen progressives whining for coverage for contraception. But that is only the beginning.

The American Association of Acupuncture and Oriental Medicine is now lobbying the Department of Health and Human Services to have acupuncture classified as an “essential health benefit” under ObamaCare. If the group is successful, insurance companies will be forced to provide coverage for such treatment. And consumers will be forced to pay for coverage that they may not want and will not use.

While many details of ObamaCare remain unknown, we do know that more and more groups will come forward begging for some provision, classification, or special favor. When they realize that they can use government coercion to achieve what they could not do voluntarily, we will be subjected to a parade of drooling brutes armed with a torrent of sob stories.

And through all of this, insurance companies will helplessly sit by while politicians and petty bureaucrats decide their fate. Their customers will watch premiums skyrocket as insurance companies are forced to cover those with pre-existing conditions and provide coverage for everything from aphid infestation to low self-esteem. The only thing that won’t be covered is the raping and pillaging that ObamaCare is about to unleash.

Using government force to “level the playing field” means that a businessman must act contrary to his own judgment: he must charge a higher price, produce an inferior product, or take some other action that he believes will harm [...]]]>

We are often told that regulations are needed to “level the playing field” and promote competition.

Using government force to “level the playing field” means that a businessman must act contrary to his own judgment: he must charge a higher price, produce an inferior product, or take some other action that he believes will harm his business. This means that, in the name of competition, the businessman is prohibited from doing his best. To use force to promote competition is, as Ayn Rand wrote, “a grotesque contradiction in terms.”

Competition results when someone thinks that he can do something better or faster or cheaper. And that cannot be compelled by government decree—force negates judgment. Freedom sanctions an individual’s right to demonstrate his vision. Government coercion renders his vision impotent.

From 1959 to 1966, the Boston Celtics basketball team won the championship of the National Basketball Association (NBA) a record eight straight times. During the thirteen-year period from 1957 to 1969, they won the championship eleven times. The Celtics dominated their league unlike any professional sports team in history. From [...]]]>

An excerpt from my book:

From 1959 to 1966, the Boston Celtics basketball team won the championship of the National Basketball Association (NBA) a record eight straight times. During the thirteen-year period from 1957 to 1969, they won the championship eleven times. The Celtics dominated their league unlike any professional sports team in history. From 1957 to 1969, the Celtics were “anti-competitive.”

Based on antitrust theory, the Celtics should have been broken up, fined, and forced to share the secret of their success with other teams. According to antitrust theory, the government should have intervened to “level the playing field.” Would that have been just? Would fans have cared to watch, knowing that, if their team was successful, the players might be fined or thrown into jail? Would the players be motivated to perform their best? This sounds ridiculous, yet, this is precisely the threat that hangs over the heads of America’s most successful businessmen.

Murdoch’s fitness for running a [...]]]>

British lawmakers have issued a report declaring that Rupert Murdoch is not a “fit and proper person” to run an international business. According to CNN.com, “The ruling could prompt British regulators to force him to sell his controlling stake in British Sky Broadcasting, a significant part of his media empire.”

Murdoch’s fitness for running a business should not be a concern of lawmakers. If he is truly unfit, that fact will be quickly reflected in lost viewers and readers. That is, the market will determine his fitness, just as it determines the fitness of any businessman.

Anyone who resorts to brute force–such as the British lawmakers who issued this report–isn’t fit to govern anything.

I won’t comment on the legalities, as I am not well versed in the Outer Space Treaty. [...]]]>

Last week’s announcement by Planetary Resources to eventually mine near-Earth asteroids has unleashed a controversy over property rights in space. There is some dispute as to whether the 1967 Outer Space Treaty prohibits private ownership of celestial objects.

I won’t comment on the legalities, as I am not well versed in the Outer Space Treaty. But morally, the answer is quite clear. Those who extract minerals from asteroids are the rightful owners of those materials and the area in which they are mining. But this does not give those entrepreneurs ownership of the entire celestial body.

For example, if a private company began mining on the moon, others would remain free to mine other areas of the moon. The first company could only claim ownership of that area necessary for its operations and others could not interfere with their enterprise.

The US government should nip this controversy in the bud by defending private property rights in space. Of course, this is highly unlikely, since the government fails to do that here on Earth.

HT: Rob Abiera