The Politics of Woke: Why PC Institutions Cave in to Communist China

Last week a few sharp-eyed members of the audience for Disney’s live-action remake of Mulan noticed something ugly in the credits. The film’s producers thanked, among others, the publicity department of the “CPC Xinjiang Uyghur Autonomous Region Committee” as well as the “Turpan Municipal Bureau of Public Security.” These are the same political and disciplinary institutions that oppress China’s Uighur minority. Disney cooperated with them without batting an eye.

But Disney is more than happy to call attention to human-rights abuses in the United States. Since George Floyd died in police custody earlier this year, the corporation and its subsidiaries, including ABC and ESPN, have issued statements in support of Black Lives Matter. The House of Mouse has reaffirmed its commitment to the ideology and practices of diversity, equity, and inclusion. Nor is Disney the only film studio to ignore repression in the People’s Republic of China while embracing the cause of social justice at home. They all do it. The question is why.

Part of the reason is parochialism. Americans just don’t care very much about what happens in other countries. Another motivation is profit. All companies desire access to the largest possible markets. Angering the Chinese Communist Party, or violating the tenets of political correctness, endangers the bottom line. Meanwhile the legitimacy of political, cultural, and economic institutions, including the corporation, has come into question. To ensure their survival, corporations must conform to the values and regulations of host societies and governments. That means playing nice with China, embracing “stakeholder capitalism,” and adopting the teachings of Ibram X. Kendi.

Selective indignation is not new. What’s striking about this latest version is its zones of prevalence. The sectors of the economy most wedded to the view that American society is systemically racist—entertainment, sports, media, tech—are the least concerned with the real and concrete injustices of the antidemocratic and hostile Chinese regime. This is the woke dialectic: dissent in America, acquiescence to China.

Just as people became aware of Mulan’s complicity in injustice, the Academy of Motion Picture Arts and Sciences promulgated a complicated set of ethnic, racial, and sexual quotas that films must meet in order to become eligible for the best picture Oscar. “The Academy Museum of Motion Pictures is committed to building an antiracist, inclusive organization that will contextualize and challenge dominant narratives around cinema, and build authentic relationships with diverse communities,” read part of the statement announcing the rules. But the Academy is less interested in contextualizing and challenging the absence of civil and political rights elsewhere. In 2013 it was happy to accept $20 million from one of China’s largest multinationals.

The NBA is no different. Its front offices, coaches, and athletes are among the most progressive in the country. Social justice messages adorn players’ uniforms. “Black Lives Matter” is painted on the court. LeBron James has leveraged his celebrity to earn further political concessions from the league, including the transformation of arenas into polling places on Election Day. But James has also made embarrassing comments regarding the conflict between democracy and autocracy in Hong Kong. And the league itself carries the shame of having operated training facilities in Xinjiang.

The Washington Free Beacon has shown that the same newspapers that devote so much space to advancing America’s racial reckoning (and whose foreign desks often report on the foulness of China’s dictatorship) also accepted millions from the Chinese government to run propaganda. The same company, Alphabet, that earlier this year announced millions in donations to social justice nonprofits expressed no qualms in 2017 when it opened an AI research center in China.

In other words, the same businesses that promote the progressive reconstruction, radical reform, or transformation of the United States are intertwined with the revisionist great power that aims to replace the United States as global hegemon. This synthesis of the woke dialectic lends an additional meaning to the term “allyship.” And it is why champions of individual rights, equality under the law, due process, and pluralism stand athwart both political correctness at home and authoritarianism abroad.

Michael Continetti

A Criminal Enterprise, aka the Democratic Party

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Somewhere within the last few decades, the United States was taken over by a clandestine criminal enterprise working under the radar to infiltrate and gain control of our media, schools, universities, unions, Hollywood, military and our halls of governance at the local, state, and federal level.  They did so in conjunction with a new American oligarchy composed of billionaires seeking a One World Order and all too willing to fund their operations, along with the aid of foreign financiers such as Red China and parts of the oil rich Islamist world.  

Within time, and with much of its funding coming from a billionaire oligarchy, they were able to hijack the entire Democrat Party who were only too willing to sell out the United States to the highest bidders while lining their own pockets with sweetheart deals made with Red China, Iran, and Ukraine.  The admittance of Red China in 2001 into the World Trade Organization, backed and supported by Bill Clinton and Joe Biden, was the beginning of China’s advance and the decline of the United States on the world stage.  As American companies moved overseas along with the millions of lost jobs in cities throughout the United States, Democrats and some Republicans, sold us a bill of goods.  They advanced the notion that we were moving towards a service economy and that cheap labor overseas meant cheaper products here at home.  They failed to mention that the loss of our manufacturing industry to China, and in particular our pharmaceutical industry, posed a national security threat since China could threaten to stop selling essential goods to us.  Nor did they mention that certain minerals, now mined in China, were critical to our military defense.  These decisions were made against our national interests; yet, no one in Washington protested.

The rise of China onto the national stage brought forth opportunities seized upon by the husbands of House Speaker Nancy Pelosi and Sen. Dianne Feinstein.  Both were able to enrich themselves to the tune of hundreds of millions of dollars by engaging in business deals with Red China, where all companies are governed by the CCP, while the two senators sat in our Senate chambers. Joe Biden’s son, Hunter, and his equity firm, were given a one and a half billion dollar contract by the Red Chinese on one of Joe Biden’s Vice Presidential visits to the communist state, yet; incredulously, there was no oversight to check for impropriety.   When Hunter Biden’s company, Burisma, was offered a multi-million dollar deal in the Ukraine, the new Ukrainian prosecutor charged with rooting out corruption, was suddenly fired after Joe Biden threatened to withhold American financial aid to Ukraine.  Incredulously and unabashedly, Biden later boasted on camera before an American audience that he had the prosecutor fired within a few short hours.  Again, yawn from the media and our Justice Department.

Bill and Hillary Clinton, the political Bonnie and Clyde of our time, while in office, accepted millions of dollars in donations for their Clinton Foundation from dubious countries such as Saudi Arabia, China, Russia, and Ukraine.  What was most certainly a “pay to play” scheme to enrich themselves, one has to ask how adversely was American policy shaped by the monetary donations collected by the Clintons during their many years in Washington.  Furthermore, as Secretary of State, Hillary Clinton sold to Russia 20% of our uranium used to build nuclear weapons.  The irony is not lost when she shamelessly concocted the fake Steel Dossier used as the basis for the Russia hoax investigation for the intended purpose of driving President Trump from office.  

Former presidential candidate John Kerry, no stranger to treasonous acts, while Secretary of State and representing Barack Hussein Obama’s administration,  secretly transferred $150 billion of our taxpayers dollars in cash to the Iranian Mullahs who regularly scream “Death to America!”  He did so without the consent of Congress; yet, silence and no calls for an investigation arose from Congress, the Justice Department and or the media for such a treasonous act.  It is noteworthy to mention that Kerry’s sons, John Jr. Heinz Jr., along with Hunter Biden, profited greatly from Kerry’s days in office.  According to leaked documents from the Ukrainian General Prosecutors office, all three were in possession of a slush fund  to the tune of $3.5 million derived from money transfers from Burisma Holding, a Ukrainian gas company,  between 2014 and 2016.

Additionally, the rise of Big Tech has created within the last few decades a new billionaire oligarchy and American aristocracy which have used their newly gained funds to finance and control public opinion at the expense of the American citizenry.  While our country was founded on the principles of a government by the people, for the people, and of the people, in reality, Big Tech and the new American oligarchy now wield considerable power and appear to have taken the reigns of the Democrat Party.  Big Tech has the means to erase our First Amendment rights and they are silencing Conservative voices on sites such as Twitter, Facebook, and other social media outlets.   In a convenient way of getting around campaign finance laws, the new oligarchy finances numerous NGOs who then turn around and fund the Democrat Party.   Hungarian billionaire,George Soros, wanted in Ukraine for corruption and despised in Great Britain, Thailand, and Malaysia for currency manipulation, is responsible for the destruction of those countries’ economies in 92′ and 98′.  He has donated over a billion dollars through these NGOs to gain control over policy and candidate decisions within the Democrat Party.   In the first three months of 2020, he has donated over $28 million to Democratic PACs for this upcoming November election.   For all practical purposes, he and his policies are on the Democrat ballot come November.  With his monetary influence, it most likely is he who selected Obama as the Democratic nominee in 2009, and it is he who placed Heels Up Harris as the vice presidential nominee.   

The unexpected election of President Trump, who promised to clean the swamp, serves as a threat to their continued corruption and reign.  Their demonization and hate expressed for this president is purely personal.  They know his reelection spells the end of their sweetheart deals, bribery, and money laundering schemes while sitting in our halls of Congress.  With the aid of our adversaries, Red China and Iran, they have thrown everything but the kitchen sink at him.  From the Russia hoax, impeachment, the Wuhan virus, and the current civil unrest in our streets, he has escaped and survived their evil deeds.  The Democrats are now desperate and going for broke.  They have exposed themselves as a corrupt criminal enterprise bent on regaining control of their corrupt money machinations while the country be damned! 

Shari Goodman has written political commentaries for American Thinker, World Net Daily, Israel Today and other online journals.

Image credit: Twitter screen shotenhanced with FotoSketcher.

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The Black Lives Matter Movement and America’s Founding Principles

Unjust police actions impact the authority of every sworn officer and hurt the reputation of every law enforcement agency.  This is why it is vital for law enforcement representatives to speak out against the bad apples anywhere in the justice system — not unlike how it is done in the medical field.

As a law enforcement officer, my fundamental duty is to serve mankind — to safeguard lives and property, to protect the innocent against deception, the weak against oppression or intimidation, and the peaceful against violence or disorder, and to respect the Constitutional rights of all men to liberty, equality, and justice.

But the claim that “systemic” racism permeates law enforcement agencies strikes me as false.  What correlates most to police shootings and arrests is the crime rate, not race.  There are an estimated 375 million annual U.S. police interactions with citizens — in 2019, 999 ended in shooting fatalities by police (0.0003%), and 14 were unarmed blacks (0.000004%).  Only one of those shootings was not attempting to resist or evade arrest (0.0000003%).  (Source: Washington Post.)  The Black Lives Matter movement chooses to ignore these facts and prefers to call attention to questionable police tactics and to ascribe racial motivations to much of law enforcement.  Tactical units from my sheriff’s department have recently been called out only to discover that there were cameras set up on scene just to “catch” officers doing something inappropriate.

The Black Live Matter movement is really two disparate groups.  One identifies with the idea that black people have been unfairly treated and discriminated against in society.  These BLM-supporters often wear the T-shirts, carry the signs, chant the slogans, and demand political and economic change.  These supporters are not part of the second group.  That is a formal organization that maintains a website with revolutionary goals, large amounts of money, and radical leadership.

The first group of adherents to the BLM message is larger and likely not aware of the radical organization whose water its members carry.  The second group is smaller and more disciplined and raises some fundamental issues that need close examination.  I refer to the first group as “BLM Supporters” and the second group as “BLM Activists.”

The BLM movement was founded in 2013 following the death of Trayvon Martin.  As the original movement grew, it failed to pay attention to factors that have caused many of the race-related problems the country has confronted.  The destruction of the black nuclear family and missing black fathers, for instance, are arguably the single most detrimental societal change America has witnessed over the past 100 years.  Out-of-wedlock births are a corollary.  Worse, these changes have too often been incentivized by government policies.

Every weekend in major inner-city neighborhoods, the death toll from black-on-black murders is staggering.  Black lives do not seem to matter to the BLM organization under these circumstances.  The young perpetrators are more often than not from fatherless homes.  Not only are BLM activists silent on this issue, but they say on their website: “We disrupt the Western-prescribed nuclear family structure requirement[.]”

Hanging on the wall in the Orange County sheriff’s training academy is a quote from Dr. Martin Luther King, Jr.  I make a mental note to read it every time I am at the academy: “Injustice anywhere is a threat to justice everywhere.”  MLK taught us that we should judge others not on the color of their skin, but on the content of their character.  BLM activists say something different: “We work vigorously for freedom and justice for Black people[.]”  In law enforcement, we are sworn to protect freedom and justice for all people equally.

Sometimes law enforcement tragically misses the mark (as do all professions), but we shouldn’t destroy or defund the whole law enforcement structure because of a few rogue incidents.  We should deal with them.  Bad cops should be fired just as bad teachers should be removed.  Nobody hates bad cops more than good cops.

Lady Justice is always portrayed with a blindfold.  The symbol stands for the idea that justice — from cop to court — is applied without regard to wealth, power, or status.  Should we raise the blindfold in certain instances so she can peek out with an eye toward taking better care of black Americans?  BLM Activists, I suspect, would say yes.

There is another critical factor that differentiates BLM Activists from BLM Supporters.  The co-founders of the BLM movement are unapologetically Marxist — followers of Karl Marx, the revolutionary German philosopher who died in 1883 and whose ideas have inspired the governments of all the communist regimes.  BLM co-founder Patrisse Cullors explicitly said that she and fellow BLM co-founder Alicia Garza are “trained Marxists.”  On the BLM website, they state: “Our members organize and build local power to intervene in violence inflicted on Black communities by the state and vigilantes.”

The Los Angeles Chapter of BLM held a rally on June 23, 2020.  Their message: “We are demanding that the School Board vote … to defund school police by 90% over the next three years.”  This theme seems to resonate throughout the BLM movement and is often endorsed by many political leaders on the left.

It is time we no longer embrace the well meaning slogans of the BLM Supporters or the radical agenda of the BLM Activists.  Rather, we must vigorously embrace and stand for the American way of life, characterized by a colorblind society, adherence to the tenets of the U.S. Constitution, and a return to traditional American family values.

Thomas Jefferson is credited with saying, “Eternal vigilance is the price of liberty.”  We are now called upon to end our silence.  We must be vigilant — or we may very well lose the country the vast majority of us of all faiths and colors and creeds love.

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What is the Free Market ?

The Free Market is a summary term for an array of exchanges that take place in society. Each exchange is undertaken as a voluntary agreement between two people or between groups of people represented by agents. These two individuals (or agents) exchange two economic goods, either tangible commodities or nontangible services. Thus, when I buy a newspaper from a news dealer for fifty cents, the news dealer and I exchange two commodities: I give up fifty cents, and the news dealer gives up the newspaper. Or if I work for a corporation, I exchange my labor services, in a mutually agreed way, for a monetary salary; here the corporation is represented by a manager (an agent) with the authority to hire.

Both parties undertake the exchange because each expects to gain from it. Also, each will repeat the exchange next time (or refuse to) because his expectation has proved correct (or incorrect) in the recent past. Trade, or exchange, is engaged in precisely because both parties benefit; if they did not expect to gain, they would not agree to the exchange.

This simple reasoning refutes the argument against free trade typical of the “mercantilist” period of sixteenth- to eighteenth-century Europe, and classically expounded by the famed sixteenth-century French essayist Montaigne. The mercantilists argued that in any trade, one party can benefit only at the expense of the other, that in every transaction there is a winner and a loser, an “exploiter” and an “exploited.” We can immediately see the fallacy in this still-popular viewpoint: the willingness and even eagerness to trade means that both parties benefit. In modern game-theory jargon, trade is a win-win situation, a “positive-sum” rather than a “zero-sum” or “negative-sum” game.

How can both parties benefit from an exchange? Each one values the two goods or services differently, and these differences set the scene for an exchange. I, for example, am walking along with money in my pocket but no newspaper; the news dealer, on the other hand, has plenty of newspapers but is anxious to acquire money. And so, finding each other, we strike a deal.

Two factors determine the terms of any agreement: how much each participant values each good in question, and each participant’s bargaining skills. How many cents will exchange for one newspaper, or how many Mickey Mantle baseball cards will swap for a Babe Ruth, depends on all the participants in the newspaper market or the baseball card market — on how much each one values the cards as compared to the other goods he could buy. These terms of exchange, called “prices” (of newspapers in terms of money, or of Babe Ruth cards in terms of Mickey Mantles), are ultimately determined by how many newspapers, or baseball cards, are available on the market in relation to how favorably buyers evaluate these goods. In shorthand, by the interaction of their supply with the demand for them.

Given the supply of a good, an increase in its value in the minds of the buyers will raise the demand for the good, more money will be bid for it, and its price will rise. The reverse occurs if the value, and therefore the demand, for the good falls. On the other hand, given the buyers’ evaluation, or demand, for a good, if the supply increases, each unit of supply — each baseball card or loaf of bread — will fall in value, and therefore, the price of the good will fall. The reverse occurs if the supply of the good decreases.

The market, then, is not simply an array, but a highly complex, interacting latticework of exchanges. In primitive societies, exchanges are all barter or direct exchange. Two people trade two directly useful goods, such as horses for cows or Mickey Mantles for Babe Ruths. But as a society develops, a step-by-step process of mutual benefit creates a situation in which one or two broadly useful and valuable commodities are chosen on the market as a medium of indirect exchange. This money-commodity, generally but not always gold or silver, is then demanded not only for its own sake, but even more to facilitate a re-exchange for another desired commodity. It is much easier to pay steelworkers not in steel bars, but in money, with which the workers can then buy whatever they desire. They are willing to accept money because they know from experience and insight that everyone else in the society will also accept that money in payment.

The modern, almost infinite latticework of exchanges, the market, is made possible by the use of money. Each person engages in specialization, or a division of labor, producing what he or she is best at. Production begins with natural resources, and then various forms of machines and capital goods, until finally, goods are sold to the consumer. At each stage of production from natural resource to consumer good, money is voluntarily exchanged for capital goods, labor services, and land resources. At each step of the way, terms of exchanges, or prices, are determined by the voluntary interactions of suppliers and demanders. This market is “free” because choices, at each step, are made freely and voluntarily.

The free market and the free price system make goods from around the world available to consumers. The free market also gives the largest possible scope to entrepreneurs, who risk capital to allocate resources so as to satisfy the future desires of the mass of consumers as efficiently as possible. Saving and investment can then develop capital goods and increase the productivity and wages of workers, thereby increasing their standard of living. The free competitive market also rewards and stimulates technological innovation that allows the innovator to get a head start in satisfying consumer wants in new and creative ways.

Not only is investment encouraged, but perhaps more important, the price system, and the profit-and-loss incentives of the market, guide capital investment and production into the proper paths. The intricate latticework can mesh and “clear” all markets so that there are no sudden, unforeseen, and inexplicable shortages and surpluses anywhere in the production system.

But exchanges are not necessarily free. Many are coerced. If a robber threatens you with “Your money or your life,” your payment to him is coerced and not voluntary, and he benefits at your expense. It is robbery, not free markets, that actually follows the mercantilist model: the robber benefits at the expense of the coerced. Exploitation occurs not in the free market, but where the coercer exploits his victim. In the long run, coercion is a negative-sum game that leads to reduced production, saving, and investment, a depleted stock of capital, and reduced productivity and living standards for all, perhaps even for the coercers themselves.

Government, in every society, is the only lawful system of coercion. Taxation is a coerced exchange, and the heavier the burden of taxation on production, the more likely it is that economic growth will falter and decline. Other forms of government coercion (e.g., price controls or restrictions that prevent new competitors from entering a market) hamper and cripple market exchanges, while others (prohibitions on deceptive practices, enforcement of contracts) can facilitate voluntary exchanges.

The ultimate in government coercion is socialism. Under socialist central planning the socialist planning board lacks a price system for land or capital goods. As even socialists like Robert Heilbroner now admit, the socialist planning board therefore has no way to calculate prices or costs or to invest capital so that the latticework of production meshes and clears. The current Soviet experience, where a bumper wheat harvest somehow cannot find its way to retail stores, is an instructive example of the impossibility of operating a complex, modern economy in the absence of a free market. There was neither incentive nor means of calculating prices and costs for hopper cars to get to the wheat, for the flour mills to receive and process it, and so on down through the large number of stages needed to reach the ultimate consumer in Moscow or Sverdlovsk. The investment in wheat is almost totally wasted.

Market socialism is, in fact, a contradiction in terms. The fashionable discussion of market socialism often overlooks one crucial aspect of the market. When two goods are indeed exchanged, what is really exchanged is the property titles in those goods. When I buy a newspaper for fifty cents, the seller and I are exchanging property titles: I yield the ownership of the fifty cents and grant it to the news dealer, and he yields the ownership of the newspaper to me. The exact same process occurs as in buying a house, except that in the case of the newspaper, matters are much more informal, and we can all avoid the intricate process of deeds, notarized contracts, agents, attorneys, mortgage brokers, and so on. But the economic nature of the two transactions remains the same.

This means that the key to the existence and flourishing of the free market is a society in which the rights and titles of private property are respected, defended, and kept secure. The key to socialism, on the other hand, is government ownership of the means of production, land, and capital goods. Thus, there can be no market in land or capital goods worthy of the name.

Some critics of the free-market argue that property rights are in conflict with “human” rights. But the critics fail to realize that in a free-market system, every person has a property right over his own person and his own labor, and that he can make free contracts for those services. Slavery violates the basic property right of the slave over his own body and person, a right that is the groundwork for any person’s property rights over nonhuman material objects. What’s more, all rights are human rights, whether it is everyone’s right to free speech or one individual’s property rights in his own home.A common charge against the free-market society is that it institutes “the law of the jungle,” of “dog eat dog,” that it spurns human cooperation for competition, and that it exalts material success as opposed to spiritual values, philosophy, or leisure activities. On the contrary, the jungle is precisely a society of coercion, theft, and parasitism, a society that demolishes lives and living standards. The peaceful market competition of producers and suppliers is a profoundly cooperative process in which everyone benefits, and where everyone’s living standard flourishes (compared to what it would be in an unfree society). And the undoubted material success of free societies provides the general affluence that permits us to enjoy an enormous amount of leisure as compared to other societies, and to pursue matters of the spirit. It is the coercive countries with little or no market activity, notably under communism, where the grind of daily existence not only impoverishes people materially, but deadens their spirit.

Murray Rothbard, Mises Institute

The Corruption of Union Leadership

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The Corruption of Union Leadership

Alongside the struc­ture of traditional unionism, there begins to grow in its shadow a murky pseudo-unionism

Sylvester Petro

Coercion marks the beginning and corruption the conclusion of the march of union power observ­able in the McClellan Record. The process begins with the use of compulsion to secure members. Thereafter new and different coer­cive devices are used to bind the unwilling employees to the union. After a union has learned the use­fulness of coercion in increasing membership, it falls into the habit of using even more in disputes with employers.

Some trade union leaders hold that any employer who resists their demands is an “enemy of the labor movement” who must be taught a lesson, and, if he con­tinues to resist, must be exter­minated. If employees themselves refuse to acquiesce in strikes, if, instead, they exercise their right to continue working during strikes, they are considered trai­tors, against whom brutal reprisals are not only permissible but praiseworthy.

Law-enforcement officials some­times stand in the way, however, and it, therefore, becomes necessary to take care of them, too. Pure bribery is not always the appropriate method here, and often a generous campaign contribution will do as well. If the laws of the land pose an obstacle to the use of union power against traitorous employers and employees, then the laws must be changed, and full-scale political action, largely financed by membership dues con­tributed in a substantial degree by workers of differing political views, is the appropriate vehicle for change. Candidates who sup­port the unions’ claims of special privileges to coerce and compel get extensive, expensive, and en­thusiastic political support; those who insist that the laws of the land should apply to trade unions are marked for extinction. Too often the unions have their way, although a startling exception here and there indicates that the black night has not yet fallen.

Meanwhile, alongside the struc­ture of traditional unionism, there begins to grow in its shadow a murky pseudo-unionism. A two-stage process is at work. Frequent use of coercion and violence by traditional unions induces their leaders to include on their staffs—alongside college-trained econ­omists—men with criminal rec­ords and backgrounds of brutality; if dirty work is to be done, it is just as well to have a person around who has had some experi­ence with it. And the practical privilege to coerce, to extort, to shake down, to compel (such as has accrued to the unions) is pre­cisely what the denizens of the underworld, the professionals of organized crime, have been search­ing for most avidly, ever since the rich pickings under Prohibition dried up.

If a single picket will harm a business badly enough to make the owner sign up with the union, maybe it will also serve to shake loose some immediate money. In either case, the picket line is coer­cive, and if it is a specially privi­leged form of coercion in the one case, why not in the other? Thus the professional extortionist dis­covers a new tool for his trade, and thus to are born “racket-picketing” and its associated shakedown techniques.

Convicted criminals are in the unions then with both feet—as adjuncts to traditional unions, and on their own, cynically using the form of unionism as a cover for their age-old methods of getting ahead in the world. The one thing they have never learned is how to work for a living. As union agents and leaders they live very well off the product of those who have learned how to make a living through socially useful work—the businessmen and workingmen of the country.

Although society at large may know very little about all this, it pays the bill—an overwhelming, extortionate, and destructive bill. A shakedown induced by “stran­ger-picketing” has to be made up by the businessman somehow.

The situation is not made any better by the shrill accusations of the union leaders against business­men about the high cost of living and unemployment. The plain fact is that no businessman ever likes to cut back production. He does so only when he has to. More often than not the union leader has been responsible for pricing union members out of the market. For that, he ought to be fired, or law and law enforcement ought to be rigorous enough to keep him from abusing workers, union members, businessmen, and the public.

Special Privilege—Unlimited Power

The point cannot be emphasized enough. The harm done by crimi­nals masquerading as union offi­cials is enormous and filled with the most ominous signs for the future of society. But it is still less than that produced by the power of the traditional unions. They daily coerce and brutally at­tack workers who decline to join or refuse to participate in strikes. They throw out of work hundreds of thousands of men because of their artificially inflated wage costs. They create irresistible in­flationary pressures and compound the evil by encouraging costly and destructive deficit-spending by governments. Through the use of legal and political special privi­leges, they tie up entire industries into tight monopolies and cartels which abuse the public and threaten the destruction of the free and competitive economy which has always been the Ameri­can ideal.

This is the panorama of union power. Traditional unions have secured for themselves special privileges which vest in them un­limited power. This power, like any other unlimited power, can only be abused, and it is abused. Violence and economic coercion by themselves create socially harm­ful conditions, the consequences of which are infinite and unpredicta­ble. Besides, they exert a magnetic force, drawing to the trade unions some of the worst types of crimi­nals, who find there an environ­ment which suits them.

The combination is a destructive force which no society can long survive: on the one hand, abuse of the citizenry and impair­ment of peaceful, progressive, pro­ductive activity; on the other hand, dissolution of the moral and political structure. In the spe­cial privileges of coercion and compulsion which unions have gained, there breeds a rotten growth which corrupts the whole moral and political structure of society.

The Welfare State Philosophy

The same thinking which is pro­ducing the Welfare State has also been largely responsible for the special privileges accorded trade unions. Furthermore, the welfare-state ideology has given the State so many diverse jobs to perform that it can no longer properly per­form the basic job for which it was designed. That job was to in­sure domestic tranquility by pro­tecting honest citizens against thugs and criminals. Proper per­formance of that basic function requires, obviously, a primary and predominant preoccupation by the government with the police force and the administration of justice.

While we expend our substance in granting special privileges and subsidies to the strong pressure groups, encouraging idleness and unproductiveness, we under man our police forces and pay them poorly, so that they have neither the numbers nor the quality of men necessary to do what is, after all, the basic job of civilization: keeping the peace.

While recognizing, then, that Senator Ives had hold of a piece of the truth in observing that the crime disclosed in the McClellan Record is a part of the larger problem of law enforcement cre­ated by the welfare-state distor­tion of the role of government, his view is not on the whole ac­curate. At least it is not the whole truth if he means to say that there are no independent causes for the prevalence of crime and corrup­tion in trade unions. It is not the whole truth because it fails to ex­plain why, among all the other private associations of society—the business firms, the bar asso­ciations, the medical associations, and the thousands of other private associations in this country—vio­lence, crime, and corruption do not prevail as they do among trade unions.

Violence, crime, and corruption prevail among trade unions to a degree unmatched in any other private association because trade unions have acquired from society and the law special privileges al­lowed to no other private associa­tion. There is every reason to be­lieve that any other private asso­ciation accorded the same privileges would manifest the same characteristics which the McClel­lan Record discloses in trade unions.

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If, for example, businessmen were allowed to compel the pur­chases of their customers, to as­sault them when they showed any intention of removing their pa­tronage, and to block access to competitors—there is very little reason to believe that such conduct would not become common busi­ness practice, leading to more and more of the same as the selective process wore on in business in the way that it has in trade unions : with the productive and the ingenious giving ground be­fore the thugs, the bullies, and the master strategists of large-scale organized violence.

Businesses compete in a civilized way partly because the law com­pels them to do so and partly be­cause the law’s compulsion has created a selection process which grinds out the thugs and the law­less and advances the able and the industrious. Among trade unions, precisely the contrary proc­ess of selection has been going on, with, as might be expected, precisely the contrary results.

Errors in Government

The sources of the special privi­leges which trade unions enjoy are to be found in the policies and conduct of the federal government over the past thirty years, begin­ning in 1930 and continuing to this date. The responsibility is nonpartisan, with Republicans and Democrats sharing it, although not in equal proportions. It is dis­tributed in another way. Rather than being confined to one or an­other of the three branches of the federal government, it is shared, instead, by all three: the legisla­tive branch, the executive branch, and the judicial branch.

Unwise laws have been made worse by the administration and interpretation they have had, while socially beneficial laws have been reduced to impotency by a re­luctant administration, on the one hand, and dubious interpretation, on the other. Without exonerating Congress from its share of the re­sponsibility, one still must ac­knowledge in the interests of ac­curacy that its record is not as defective as that of the other par­ties: the National Labor Relations Board, representing the executive branch; and the United States Su­preme Court, representing the judicial branch.

Accuracy calls for further quali­fication. There have at all times been on the Supreme Court some justices who resisted valiantly and with great legal ability the errors and excesses of that Court. Again, some of the justices who earlier participated in the most dubious decisions of the Court have shown since then that theirs were good-faith errors; and, as all good and learned men will do upon finding themselves in error, they have taken steps toward correction.

It should also be noted that at frequent intervals between 1935 and 1953 there were some mem­bers of the NLRB who recognized and dissented from improper de­cisions of the Board. Moreover, the majority of the Board since 1953 has been guilty of nothing comparable to the outrageous mis­interpretations of the Taft-Hart­ley Act handed down by the ma­jority which prevailed from 1949 to 1953, although the more recent majority has been very slow to correct some and has failed com­pletely to reverse the most serious of its predecessor’s misinterpre­tations.

Whereas the NLRB and the Su­preme Court have preponderantly contributed decisions heightening the abusive powers of trade unions and negating the efforts of Con­gress to reduce such powers, the record of the Federal Circuit Courts of Appeals has been one, preponderantly, of the kind of ex­cellence in legal scholarship, fair-mindedness, and fidelity to law and precedent which is to be expected of all judges. The Circuit Judges, with some exceptions, have neither tried to give trade unions and their officials more privileges than the laws of Congress intended nor have they negated, except by di­rect mandate of the Supreme Court, the laws of Congress which were intended to limit abusive and monopolistic trade-union conduct.

Little need be added at this point on the kind of corruption at all levels which we have witnessed in the preceding chapters…. But we must bear in mind that moral and political corruption of the varieties recounted their rot in­tegrity at all levels and thus weaken the fiber of society, mak­ing it prone to further corruption of a million kinds in a million ways, every day. Nonunion men treated brutally as outlaws and union members as serfs, the in­filtration of unions by professional gangsters, extortion from busi­nessmen, bribery and corruption of public officials, the theory that trade unions are entitled to special privileges from government—no society can survive much of that for very long.

Destructive Monopoly Powers

All these put together, however, probably do not equal and cer­tainly do not exceed the danger in­herent in the necessary course of monopolistic unionism. As much as trade unions may protest their virtue and distort the truth, it is the opinion of the most competent economists in this country, and of the greatest economists in the world, that monopolistic trade unionism will destroy any free en­terprise system if it is allowed to proceed unchecked. Many of America’s ranking economists have come to more or less this same conclusion—Fritz Machlup, Milton Friedman, David McCord Wright, Edward H. Chamberlin, Philip Bradley, Henry C. Simons, and many others of equal ability and disinterested devotion to truth.1 Their conclusions are shared by economists of unsur­passed international reputation, including Friedrich A. Hayek and Wilhelm Roepke, as well as the man who has in our time achieved the greatest stature of all in the social sciences, in my opinion, Professor Ludwig von Mises.

Steps in the Process

All these men agree, not only as to the fact but as to the process by means of which trade unions will, if unchecked, bring about the destruction of the free society. First, compulsory membership leading to dictatorial control of all workers; second, through the ensuing monopolistic regimenta­tion of all industry, the securing of wage structures higher than the market will bear; third, in in­evitable consequence, drastic and severe unemployment of great numbers of workers; fourth, clamorous insistence that govern­ment, through deficit spending, create jobs and other subsidies for the men thrown into unemploy­ment by the union monopolies; fifth, loose money policies by the monetary arm of a government politically committed to “full em­ployment” policies; sixth, a crack­up inflation; seventh, consequent mangling of the lives of all those who have attempted to save; eighth, increasing chaos and dis­location; ninth, the rise of vicious demagogues playing upon the con­fusion, chaos, and dissatisfaction of the populace to secure for them­selves dictatorial powers which permit them to apply totalitarian remedies which the Constitution of the United States inhabits; tenth, dissolution into the jungle.

The McClellan Record demon­strates the fundamental culpabil­ity of the federal government for the intolerable conditions which exist in labor relations. Attacks on thugs, racketeers, and power-hungry union leaders miss the real point. The real problem, the real fault, lies in a theory of gov­ernment which ensures an awful paradox: a virtual anarchy within a plethora of laws. We have thou­sands upon thousands of rules and statutes, millions upon millions of government employees. Yet we have no law.

Government’s Limited Role

The ultimate responsibility falls to the public. But this fact does not absolve the members of the government from all responsibil­ity. It is their job to inform the public that they cannot deal with all the things which the special privilege groups are seeking and still run a decent government in the general welfare. Then it is the job of the public to understand that government, like all other human institutions, has very nar­row limits. It may be able to do a fair job of providing for the na­tional defense, of keeping the peace, of enforcing the laws, and of administering justice in the courts—if it devotes all its time and energy to those difficult tasks. But it cannot do those things at all, as the McClellan Record so vividly demonstrates if its ener­gies are expended on every pet project upon which every pressure group from the National Educa­tion Association to the National Committee for the Protection of Tropical Fish comes running to Washington for help.

I do not know of any short way to bring about limited and there­fore effective government in this country; that will come only when large numbers of people appre­ciate its value and insist upon it. Yet I am convinced that the jun­gle, retrogression, and decay are the necessary result of unlimited government, just as they are the necessary result of unlimited power in trade unions. No civili­zation can long survive unlimited power in any hands. The greatest contribution of the McClellan Committee lies in its overwhelm­ing documentation of that truth. 

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Sylvester Petro
Sylvester Petro

Sylvester Petro (1917–2007) was a professor of law and the author of several books on the history of labor policy in the United States, including The Labor Policy of a Free SocietyThe Kohler Strike, and The Kingsport Press Strike.
As professsor and director of the Wake Forest University Institute of Law and Policy Analysis, he taught generations of students about the history of labor unions, while defending free association and free contract as essential to the free and prosperous commonwealth.

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Further Reading

The Perversion of Pluralism

Sylvester Petro – 6/1/1964

Labor vs. Management

William H. Peterson – 7/1/1959

Competition, Monopoly, and the Role of Government

Sylvester Petro – 12/1/1959

Can Labor Clean Its Own House?

Sylvester Petro – 2/1/1958

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This isn’t Social Justice, it’s Blackmail

Aaron Coleman, age 23, running as a Democrat for the House of Representatives from Kansas, confessed to brutally attacking his girlfriend. His excuse? We didn’t have Medicaid for All, he said. If we had Medicaid for All, boyfriends wouldn’t savagely attack their girlfriends. Unless we get Medicaid for All, the violence will continue.

Black Lives Matter and Antifa tear cities to shreds. Their excuse? We won’t defund the police. And we won’t redistribute wealth more than we already do. Until we do both of these things, they say, they will continue to tear our cities to shreds. And, they promise, they’re coming for us in the suburbs and rural areas too. What do you think they will do after we no longer have police, should we give in to their demands?

They call it “social justice” warfare. It’s not social, and it’s not just. It’s warfare all right — the most brutal, unprovoked and unjustified kind. It’s the kind of warfare you’d see if you gave loaded weapons, or nuclear bombs, to a group of rowdy five-year-old children.

In a different era, we called this blackmail.

Blackmail is when you threaten to burn down someone’s house, disarm them or even kill them, unless you do what they want you to do. It used to be illegal. Not only do these thugs get away with it in cities run by far-left mayors, but they’re aided and abetted by wealthy celebrities and the very powerful, very rich mob known as the Democratic Party.

We used to call wealthy perpetrators of violence mobsters. Today millions of us seek to call them Mr. President and Ms. Vice President.

The worst part of all? We’re told to look on it all as morally virtuous. The mobs and thugs don’t merely destroy buildings and make threats. They’re after your soul. In reports of what goes on in places like Portland, Seattle and Chicago, the mobs gang up on people whom they deem deserving of such intimidation, and demand they relent and apologize — for being white, for being “privileged” or whatever the perceived offense is said to be.

THIS is what going after people’s souls look like. It’s the worst kind of warfare there is. I thought the Jihad waged by similar terrorists who provided us with 9/11 (19 years ago) was bad. Even I never thought I’d live to see something worse — in America, of all places. Thank you for this, public schools, universities, academia, corporate tech giants like Facebook and media. You’re killing America — and you expect us to applaud you for it.

Michael J. Hurd

Fear: The Foundation of Government Power

  • All animals experience fear—human beings, perhaps, most of all. Any animal incapable of fear would have been hard pressed to survive, regardless of its size, speed, or other attributes. Fear alerts us to dangers that threaten our well-being and sometimes our very lives. Sensing fear, we respond by running away, by hiding, or by preparing to ward off the danger.

To disregard fear is to place ourselves in possibly mortal jeopardy. Even the man who acts heroically on the battlefield, if he is honest, admits that he is scared. To tell people not to be afraid is to give them advice that they cannot take. Our evolved physiological makeup disposes us to fear all sorts of actual and potential threats, even those that exist only in our imagination.

The people who have the effrontery to rule us, who call themselves our government, understand this basic fact of human nature. They exploit it, and they cultivate it. Whether they compose a warfare state or a welfare state, they depend on it to secure popular submission, compliance with official dictates, and, on some occasions, affirmative cooperation with the state’s enterprises and adventures. Without popular fear, no government could endure more than twenty-four hours. David Hume taught that all government rests on public opinion, but that opinion, I maintain, is not the bedrock of government. Public opinion itself rests on something deeper: fear.[1]

The Natural History of Fear

Thousands of years ago, when the first governments were fastening themselves on people, they relied primarily on warfare and conquest. As Henry Hazlitt ([1976] 1994) observes,

There may have been somewhere, as a few eighteenth-century philosophers dreamed, a group of peaceful men who got together one evening after work and drew up a Social Contract to form the state. But nobody has been able to find an actual record of it. Practically all the governments whose origins are historically established were the result of conquest—of one tribe by another, one city by another, one people by another. Of course there have been constitutional conventions, but they merely changed the working rules of governments already in being.

Losers who were not slain in the conquest itself had to endure the consequent rape and pillage and in the longer term to acquiesce in the continuing payment of tribute to the insistent rulers—the stationary bandits, as Mancur Olson (2000, 6-9) aptly calls them. Subjugated people, for good reason, feared for their lives. Offered the choice of losing their wealth or losing their lives, they tended to choose the sacrifice of their wealth. Hence arose taxation, variously rendered in goods, services, or money (Nock [1935] 1973, 19-22; Nock relies on and credits the pioneering historical research of Ludwig Gumplowicz and Franz Oppenheimer).

Conquered people, however, naturally resent their imposed government and the taxation and other insults that it foists on them. Such resentful people easily become restive; should a promising opportunity to throw off the oppressor’s dominion present itself, they may seize it. Even if they mount no rebellion or overt resistance, however, they quietly strive to avoid their rulers’ exactions and to sabotage their rulers’ apparatus of government. As Machiavelli observes, the conqueror “who does not manage this matter well, will soon lose whatever he has gained, and while he retains it will find in it endless troubles and annoyances” ([1513] 1992, 5). For the stationary bandits, force alone proves a very costly resource for keeping people in the mood to generate a substantial, steady stream of tribute.

Sooner or later, therefore, every government augments the power of its sword with the power of its priesthood, forging an iron union of throne and altar. In olden times, not uncommonly, the rulers were themselves declared to be gods—the Pharaohs of ancient Egypt made this claim for many centuries. Now the subjects can be brought to fear not only the ruler’s superior force, but also his supernatural powers. Moreover, if people believe in an afterlife, where the pain and sorrows of this life may be sloughed off, the priests hold a privileged position in prescribing the sort of behavior in the here and now that best serves one’s interest in securing a blessed situation in the life to come. Referring to the Catholic Church of his own day, Machiavelli takes note of “the spiritual power which of itself confers so mighty an authority” ([1513] 1992, 7), and he heaps praise on Ferdinand of Aragon, who, “always covering himself with the cloak of religion, … had recourse to what may be called pious cruelty” (59, emphasis in original).[2] Naturally, the warriors and the priests, if not one and the same, almost invariably come to be cooperating parties in the apparatus of rule. In medieval Europe, for example, a baron’s younger brother might look forward to becoming a bishop.

Thus, the warrior element of government puts the people in fear for their lives, and the priestly element puts them in fear for their eternal souls. These two fears compose a powerful compound—sufficient to prop up governments everywhere on earth for several millennia.

Over the ages, governments refined their appeals to popular fears, fostering an ideology that emphasizes the people’s vulnerability to a variety of internal and external dangers from which the governors—of all people!—are said to be their protectors. Government, it is claimed, protects the populace from external attackers and from internal disorder, both of which are portrayed as ever-present threats. Sometimes the government, as if seeking to fortify the mythology with grains of truth, does protect people in this fashion—even the shepherd protects his sheep, but he does so to serve his own interest, not theirs, and when the time comes, he will shear or slaughter them as his interest dictates.[3] When the government fails to protect the people as promised, it always has a good excuse, often blaming some element of the population—scapegoats such as traders, money lenders, and unpopular ethnic or religious minorities. “[N]o prince,” Machiavelli assures us, “was ever at a loss for plausible reasons to cloak a breach of faith” ([1513] 1992, 46).

The religious grounds for submission to the ruler-gods gradually transmogrified into notions of nationalism and popular duty, culminating eventually in the curious idea that under a democratic system of government, the people themselves are the government, and hence whatever it requires them to do, they are really doing for themselves—as Woodrow Wilson had the cheek to declare when he proclaimed military conscription backed by severe criminal sanctions in 1917, “it is in no sense a conscription of the unwilling: it is, rather, selection from a nation which has volunteered in mass” (qtd. in Palmer 1931, 216-17).

Not long after the democratic dogma had gained a firm foothold, organized coalitions emerged from the mass electorate and joined the elites in looting the public treasury, and, as a consequence, in the late nineteenth century the so-called welfare state began to take shape. From that time forward, people were told that the government can and should protect them from all sorts of workaday threats to their lives, livelihoods, and overall well-being—threats of destitution, hunger, disability, unemployment, illness, lack of income in old age, germs in the water, toxins in the food, and insults to their race, sex, ancestry, creed, and so forth. Nearly everything that the people feared, the government then stood poised to ward off. Thus did the welfare state anchor its rationale in the solid rock of fear. Governments, having exploited popular fears of violence so successfully from time immemorial (promising “national security”), had no difficulty in cementing these new stones (promising “social security”) into their foundations of rule.

The Political Economy of Fear

Fear, like every other “productive” resource, is subject to the laws of production. Thus, it cannot escape the law of diminishing marginal productivity: as successive doses of fear-mongering are added to the government’s “production” process, the incremental public clamor for governmental protection declines. The first time the government cries wolf, the public is frightened; the second time, less so; the third time, still less so. If the government plays the fear card too much, it overloads the public’s sensibilities, and eventually people discount almost entirely the government’s attempts to frighten them further.

Having been warned in the 1970s about catastrophic global cooling (see, for example, The Cooling World 1975), then, soon afterward, about catastrophic global warming, the populace may grow weary of heeding the government’s warnings about the dire consequences of alleged global climate changes—dire unless, of course, the government takes stringent measures to bludgeon the people into doing what “must” be done to avert the predicted disaster.

Recently the former Homeland Security czar Tom Ridge revealed that other government officials had overruled him when he wanted to refrain from raising the color-coded threat level to orange, or “high” risk of terrorist attack, in response to highly unlikely threats. “You have to use that tool of communication very sparingly,” Ridge astutely remarked (qtd. by Hall 2005).

Fear is a depreciating asset. As Machiavelli observes, “the temper of the multitude is fickle, and … while it is easy to persuade them of a thing, it is hard to fix them in that persuasion” ([1513 1992, 14). Unless the foretold threat eventuates, the people come to doubt its substance. The government must make up for the depreciation by investing in the maintenance, modernization, and replacement of its stock of fear capital. For example, during the Cold War, the general sense of fear of the Soviets tended to dissipate unless restored by periodic crises, many of which took the form of officially announced or leaked “gaps” between U.S. and Soviet military capabilities: troop-strength gap, bomber gap, missile gap, antimissile gap, first-strike-missile gap, defense-spending gap, thermonuclear-throw-weight gap, and so forth (Higgs 1994, 301-02).[4] Lately, a succession of official warnings about possible forms of terrorist attack on the homeland has served the same purpose: keeping the people “vigilant,” which is to say, willing to pour enormous amounts of their money into the government’s bottomless budgetary pits of “defense” and “homeland security” (Higgs 2003b).

This same factor helps to explain the drumbeat of fears pounded out by the mass media: besides serving their own interests in capturing an audience, they buy insurance against government punishment by playing along with whatever program of fear-mongering the government is conducting currently. Anyone who watches, say, CNN’s Headline News programs can attest that a day seldom passes without some new announcement of a previously unsuspected Terrible Threat—I call it the danger du jour.

By keeping the population in a state of artificially heightened apprehension, the government-cum-media prepares the ground for planting specific measures of taxation, regulation, surveillance, reporting, and other invasions of the people’s wealth, privacy, and freedoms. Left alone for a while, relieved of this ceaseless bombardment of warnings, people would soon come to understand that hardly any of the announced threats has any substance and that they can manage their own affairs quite well without the security-related regimentation and tax-extortion the government seeks to justify.

Large parts of the government and the “private” sector participate in the production and distribution of fear. (Beware: many of the people in the ostensibly private sector are in reality some sort of mercenary living ultimately at taxpayer expense. True government employment is much greater than officially reported [Light 1999; Higgs 2005a] .) Defense contractors, of course, have long devoted themselves to stoking fears of enemies big and small around the globe who allegedly seek to crush our way of life at the earliest opportunity. Boeing’s often-shown TV spots, for example, assure us that the company is contributing mightily to protecting “our freedom.” If you believe that, I have a shiny hunk of useless Cold War hardware to sell you. The news and entertainment media enthusiastically jump on the bandwagon of foreign-menace alarmism—anything to get the public’s attention.

Consultants of every size and shape clamber onboard, too, facilitating the distribution of billions of dollars to politically favored suppliers of phoney-baloney “studies” that give rise to thick reports, the bulk of which is nothing but worthless filler restating the problem and speculating about how one might conceivably go about discovering workable solutions. All such reports agree, however, that a crisis looms and that more such studies must be made in preparation for dealing with it. Hence a kind of Say’s Law of the political economy of crisis: supply (of government-funded studies) creates its own demand (for government-funded studies).

Truth be known, governments commission studies when they are content with the status quo but desire to write hefty checks to political favorites, cronies, and old associates who now purport to be “consultants.” At the same time, in this way, the government demonstrates to the public that it is “doing something” to avert impending crisis X.

At every point, opportunists latch onto existing fears and strive to invent new ones to feather their own nests. Thus, public-school teachers and administrators agree that the nation faces an “education crisis.” Police departments and temperance crusaders insist that the nation faces a generalized “drug crisis” or at times a specific drug crisis, such as “an epidemic of crack cocaine use.” Public-health interests foster fears of “epidemics” that in reality consist not of the spread of contagious pathogens but of the lack of personal control and self-responsibility, such as the “epidemic of obesity” or the “epidemic of juvenile homicides.” By means of this tactic, a host of personal peccadilloes has been medicalized and consigned to the “therapeutic state” (Nolan 1998, Szasz 2001, Higgs 1999).

In this way, people’s fears that their children may become drug addicts or gun down a classmate become grist for the government’s mill—a mill that may grind slowly, but at least it does so at immense expense, with each dollar falling into some fortunate recipient’s pocket (a psychiatrist, a social worker, a public-health nurse, a drug-court judge; the list is almost endless). In this way and countless others, private parties become complicit in sustaining a vast government apparatus fueled by fear.

Fear Works Best in Wartime

Even absolute monarchs can get bored. The exercise of great power may become tedious and burdensome—underlings are always disturbing your serenity with questions about details; victims are always appealing for clemency, pardons, or exemptions from your rules. In wartime, however, rulers come alive. Nothing equals war as an opportunity for greatness and public acclaim, as all such leaders understand (Higgs 1997). Condemned to spend their time in high office during peacetime, they are necessarily condemned to go down in history as mediocrities at best.

Upon the outbreak of war, however, the exhilaration of the hour spreads through the entire governing apparatus. Army officers who had languished for years at the rank of captain may now anticipate becoming colonels. Bureau heads who had supervised a hundred subordinates with a budget of $1 million may look forward to overseeing a thousand with a budget of $20 million. Powerful new control agencies must be created and staffed. New facilities must be built, furnished, and operated. Politicians who had found themselves frozen in partisan gridlock can now expect that the torrent of money gushing from the public treasury will grease the wheels for putting together humongous legislative deals undreamt of in the past. Everywhere the government turns its gaze, the scene is flush with energy, power, and money. For those whose hands direct the machinery of a government at war, life has never been better.

Small wonder that John T. Flynn (1948), in writing about the teeming bureaucrats during World War II, titled his chapter “The Happiest Years of Their Lives”:

Even before the war, the country had become a bureaucrat’s paradise. But with the launching of the war effort the bureaus proliferated and the bureaucrats swarmed over the land like a plague of locusts. … The place [Washington, D.C.] swarmed with little professors fresh from their $2,500-a-year jobs now stimulated by five, six and seven-thousand-dollar salaries and whole big chunks of the American economy resting in their laps. (310, 315)

Sudden bureaucratic dilation on such a scale can happen only when the nation goes to war and the public relaxes its resistance to the government’s exactions. Legislators know that they can now get away with taxing people at hugely elevated rates, rationing goods, allocating raw materials, transportation services, and credit, authorizing gargantuan borrowing, drafting men, and generally exercising vastly more power than they exercised before the war.

Although people may groan and complain about the specific actions the bureaucrats take in implementing the wartime mobilization, few dare to resist overtly or even to criticize publicly the overall mobilization or the government’s entry into the war—by doing so they would expose themselves not only to legal and extralegal government retribution but also to the rebuke and ostracism of their friends, neighbors, and business associates. As the conversation stopper went during World War II, “Don’t you know there’s a war on?” (Lingeman 1970).

Because during wartime the public fears for the nation’s welfare, perhaps even for its very survival, people surrender wealth, privacy, and liberties to the government far more readily than they otherwise would. Government and its private contractors therefore have a field day. Opportunists galore join the party, each claiming to be performing some “essential war service,” no matter how remote their affairs may be from contributing directly to the military program. Using popular fear to justify its predations, the government lays claim to great expanses of the economy and the society. Government taxation, borrowing, expenditure, and direct controls dilate, while individual rights shrivel into insignificance. Of what importance is one little person when the entire nation is in peril?

Finally, of course, every war ends, but each leaves legacies that persist, sometimes permanently. In the United States, the War between the States and both world wars left a multitude of such legacies (Hummel 1996, Higgs 1987, 2004). Likewise, as Corey Robin (2004, 25) writes, “one day, the war on terrorism will come to an end. All wars do. And when it does, we will find ourselves still living in fear: not of terrorism or radical Islam, but of the domestic rulers that fear has left behind.” Among other things, we will find that “various security agencies operating in the interest of national security have leveraged their coercive power in ways that target dissenters posing no conceivable threat of terrorism” (189). Not by accident, “the FBI has targeted the antiwar movement in the United States for especially close scrutiny” (189).

Such targeting is scarcely a surprise, because war is, in Randolph Bourne’s classic phrase, “the health of the state,” and the FBI is a core agency in protecting and enhancing the U.S. government’s health. Over the years, the FBI has also done much to promote fear among the American populace, most notoriously perhaps in its COINTELPRO operations during the 1960s, but in plenty of others ways, too (Linfield 1990, 59-60, 71, 99-102, 123-28, 134-39). Nor has it worked alone in these endeavors. From top to bottom, the government wants us to be afraid, needs us to be afraid, invests greatly in making us afraid.

Conclusion

Were we ever to stop being afraid of the government itself and to cast off the phoney fears it has fostered, the government would shrivel and die, and the host would disappear for the tens of millions of parasites in the United States—not to speak of the vast number of others in the rest of the world—who now feed directly and indirectly off the public’s wealth and energies. On that glorious day, everyone who had been living at public expense would have to get an honest job, and the rest of us, recognizing government as the false god it has always been, could set about assuaging our remaining fears in more productive and morally defensible ways.

Robert Higgs

Leftists Plan to Destroy America via Unrest

“MoveOn, left-wing groups gear up for ‘mass public unrest’ after Election Day” [Fox News headline]

Leftists are not “gearing up” for election unrest. They are PLANNING and ORCHESTRATING it. They seek to destroy our system of liberty, capitalism, individualism and civility. If you think Democrats are not barbarians, you aren’t paying attention.

Michael J. Hurd

The Siren Song for the State

The state is the most destructive institution human beings have ever devised—a fire that, at best, can be controlled for only a short time before it o’erleaps its improvised confinements and spreads its flames far and wide.

Whatever promotes the growth of the state also weakens the capacity of individuals in civil society to fend off the state’s depredations and therefore augments the public’s multifaceted victimization at the hands of state functionaries. Nothing promotes the growth of the state as much as national emergency—war and other crises comparable to war in the seriousness of the threats they pose.

States, by their very nature, are perpetually at war—not always against foreign foes, of course, but always against their own subjects. The state’s most fundamental purpose, the activity without which it cannot even exist, is robbery. The state gains its very sustenance from robbery, which it pretties up ideologically by giving it a different name (taxation) and by striving to sanctify its intrinsic crime as permissible and socially necessary. State propaganda, statist ideologies, and long-established routine combine to convince many people that they have a legitimate obligation, even a moral duty to pay taxes to the state that rules their society.

They fall into such erroneous moral reasoning because they are told incessantly that the tribute they fork over is actually a kind of price paid for essential services received, and that in the case of certain services, such as protection from foreign and domestic aggressors against their rights to life, liberty, and property, only the government can provide the service effectively. They are not permitted to test this claim by resorting to competing suppliers of law, order, and security, however, because the government enforces a monopoly over the production and distribution of its alleged “services” and brings violence to bear against would-be competitors. In so doing, it reveals the fraud at the heart of its impudent claims and gives sufficient proof that it is not a genuine protector, but a mere protection racket.

All governments are, as they must be, oligarchies: only a relatively small number of people have substantial effective discretion to make critical decisions about how the state’s power will be brought to bear. Beyond the oligarchy itself and the police and military forces that compose its Praetorian Guard, somewhat larger groups constitute a supporting coalition. These groups provide important financial and other support to the oligarchs and look to them for compensating rewards—legal privileges, subsidies, jobs, exclusive franchises and licenses, transfers of financial income and wealth, goods and services in kind, and other booty—channeled to them at the expense of the mass of the people. Thus, the political class in general—that is, the oligarchs, the Praetorian Guards, and the supporting coalition—uses government power (which means ultimately the police and the armed forces) to exploit everyone outside this class by wielding or threatening to wield violence against all who fail to pay the tribute the oligarchs demand or to obey the rules they dictate.

Democratic political forms and rituals, such as elections and formal administrative proceedings, disguise this class exploitation and trick the masses into the false belief that the government’s operation yields them net benefits. In the most extreme form of misapprehension, the people at large become convinced that, owing to democracy, they themselves “are the government.”

Individual passages back and forth across the boundary between the political class and the exploited class testify, however, to nothing more than the system’s cunningly contrived flexibility and openness. Although the system is inherently exploitative and cannot exist in any other form, it allows some leeway at the margins in the determination of which specific individuals will be the shafters and which the shaftees. At the top, a modest degree of “circulation of elites” within the oligarchy also serves to mask the political system’s essential character.

It is a sound interpretive rule, however, that anything that cannot be accomplished except with the aid of threats or the actual exercise of violence against unoffending persons cannot be beneficial to one and all. The mass belief in the general beneficence of democracy represents a kind of Stockholm syndrome writ large. Yet, no matter how widely this syndrome may extend, it cannot alter the basic fact that owing to the operation of government as we know it—that is, government without genuine, express, individual consent—a minority lives on balance at the expense of the rest, and the rest therefore lose on balance in the process, while the oligarchs (elected or not, it scarcely matters) preside over the enormous web of criminal organizations we know as the state.

Notwithstanding the ideological enchantment with which official high priests and statist intellectuals have beguiled the plundered class, many members of this class retain a capacity to recognize at least some of their losses, and hence they sometimes resist further incursions on their rights by publicly expressing their grievances, by supporting political challengers who promise to lighten their burdens, by fleeing the country, and, most important, by evading or avoiding taxes and by violating legal prohibitions and regulatory restraints on their actions, as in the so-called underground economy, or “black market.”

These various forms of resistance together compose a force that opposes the government’s constant pressure to expand its domination. These two forces, working one against the other, establish a locus of “equilibrium,” a boundary between the set of rights the government has overridden or seized and the set of rights the plundered class has somehow managed to retain, whether by formal constitutional constraints or by everyday tax evasion, black-market transactions, and other defensive violations of the government’s oppressive rules.

Politics in the largest sense can be viewed as the struggle to push this boundary one way or the other. For members of the political class, the crucial question is always: how can we push out the frontier, how can we augment the government’s dominion and plunder, with net gain to ourselves, the exploiters who live not by honest production and voluntary exchange, but by fleecing those who do so?

National emergency—war or a similarly menacing crisis—answers the political class’s crucial question more effectively than anything else, because such a crisis has a uniquely effective capacity to dissipate the forces that otherwise would obstruct or oppose the government’s expansion.

Virtually any war will serve, at least for a while, because in modern nation-states the outbreak of war invariably leads the masses to “rally ‘round the flag,” regardless of their previous ideological stance in relation to the government.

In searching for the cause of this tremendous, rationally unjustified “rallying ‘round the flag,” we do not have far to go. Such public reactions are always driven by a combination of fear, ignorance, and uncertainty against a background of intense jingoistic nationalism, a popular culture predisposed toward violence, and a general inability to distinguish between the state and the people at large.

Because the government ceaselessly sings the siren song, relentlessly propagandizing the public to look upon it as their protector—such alleged protection being the principal excuse for its routinely robbing them and violating their natural rights—and because the mass media incessantly magnify and spread the government’s propaganda, we can scarcely be surprised if that propaganda turns out to have entered deeply into many people’s thinking, especially when they are in a state of near-panic. Unable to think clearly in an informed way, most people fall back on a childlike us-against- them style of understanding the perceived threat and what should be done about it.

The so-called war on terror has given rise to a huge industry that has emerged almost from scratch during the past few years. According to a 2006 Forbes report, the Department of Homeland Security and its predecessor agencies paid private contractors at least $130 billion after 9/11, and other federal agencies have spent a comparable amount. Thus, besides the military-industrial-congressional complex (MICC), we now have a parallel security-industrial-congressional complex (SICC).

Between 1999 and 2006, the number of federal homeland-security contractors increased from nine companies to 33,890, and a multi-billion-dollar industry selling security-related goods and services has emerged complete with specialized newsletters, magazines, websites, consultants, trade shows, job placement services, and a veritable army of lobbyists working around the clock to widen the river of money that flows to these opportunists. As Paul Harris wrote, “America is in the grip of a business based on fear.” The last thing these vultures want, of course, is an abatement of the perceived terrorist threat, and we can count on them to hype any signs of an increase in such threats and, of course, to crowd the trough, happily slurping up the taxpayers’ money.

What chance does peace have when millions of well-heeled, politically connected opportunists of all stripes depend on the continuation of a state of war for their personal financial success? For members of Congress, the Department of Homeland Security has quickly become the most magnificent dispenser of pork and patronage to come along in decades. Everyone is happy here, except for the beleaguered ordinary citizens, whose pockets are being picked and whose liberties are being overridden by politicians and private-sector predators with utter contempt for the people’s intelligence and rights. Yet, so long as the people continue to be consumed by fear and to fall for the age-old swindle that the government seeks only to protect them, these abuses will never end.

A peaceful state is an impossibility. Even a state that refrains from fighting foreigners goes on fighting its own subjects continuously, to keep them under its control and to suppress competitors who might try to break into the domain of its protection racket. The people cry out for security, yet they will not take responsibility for their own protection, and like the mariners of Greek mythology, they leap overboard immediately in response to the state’s siren song.

When the Israelites had fled from their captivity in Egypt, they made do for centuries with only judges, yet they were not satisfied, and eventually they demanded a king, crying out:

“We will have a king over us; That we also may be like all the nations; and that our king may judge us, and go out before us, and fight our battles.” (1 Samuel 8:19–20)

Well, they got a king all right, just as we Americans have embraced one of our own, though we call ours a president. The Israelites, as the prophet Samuel had warned, were no better off for having a king, however: King Saul only led them from one slaughter to another (1 Samuel 14: 47–48).

Likewise, our rulers have led us from one unnecessary slaughter to the next; and, to make matters worse, they have exploited each such occasion to fasten their chains around us more tightly. Like the ancient Israelites, we Americans shall never have real, lasting peace so long as we give our allegiance to a king—that is, in our case, to the whole conglomeration of institutionalized exploiters and murderers we know as the state.Author:

Robert Higgs

Dr. Robert Higgs is retired and lives in Mexico. He was a senior fellow in political economy for the Independent Institute and longtime editor of The Independent Review; he was also a senior fellow of the Mises Institute. He is the 2007 recipient of the Gary G. Schlarbaum Prize for Lifetime Achievement in the Cause of Liberty, and the 2015 Murray N. Rothbard Medal of Freedom.

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How the World was Made Safe for Crony Capitalism

For most of US history, crony capitalism has been in a struggle with free-market capitalism for the heart and soul of the American economy. For the past half century, crony capitalism has been gaining the upper hand. There are many reasons why, all of which can be traced to the insatiable desire of the state to gain and hold power.

As Bob Higgs has pointed out in a lifetime of scholarship, crises are the health of the state. Whether these crises are unavoidable or manufactured by the state, either deliberately or through mere bungling, the state rarely misses an opportunity to use them to its advantage.

David Stockman’s recent book, The Great Deformation, escorts the reader through a welter of ideas, institutions, and crises that the state did, indeed, use to its advantage to funnel billions of dollars from the general public into the pockets of the well-connected. Stockman’s chief culprits are the ideas of Fisher, Keynes, and Friedman; the institutions of the Federal Reserve System and the presidency; the crises of the Great Depression; the run on US gold of the late 60s; the stock market crash of 1987; and the financial crisis of 2008, to name a few.

Crises are useful to the state because they create fear and fear causes many people to agree with Theodore Roosevelt that, “In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.” Acts of self-dealing that would face stiff resistance in normal times get a free pass in times of crisis, as the wrong thing becomes seen as acceptable, if not necessary. A case in point was the Reagan military build-up, predicated on an exaggerated view of Soviet offensive capabilities, which provided more money than the armed forces’ leadership knew what to do with.

Periods of easy money are also immensely fertile fields for crony capitalism. After all, the first recipients of new money benefit at the expense of the last recipients and who those first recipients are is hardly random. By keeping interest rates below their natural levels, easy money cripples the stock market’s ability to carry out its price-discovery function, which is so vital to rational economic calculation and limits its usefulness to all but speculators. In addition, easy money policy enables increased government spending and as government spending grows, so does the opportunity to divert that spending toward the well-connected.

In trying to make sense of our recent financial difficulties, a key point that most commentators miss, is that capitalism is not merely a profit system, but a profit and loss system. As unpleasant as the losses may be, they serve a therapeutic function of utmost consequence. By withdrawing that therapy, such policies as TARP, ZIRP (zero-interest rate policy), quantitative easing, and too-big-to-fail, socialize the losses of — you guessed it — the cronies of those who wield power.

As bad as crony capitalism is in its own right, it does further damage by sullying the name of free-market capitalism, the most productive economic arrangement known to man. This adds “injury to insult,” since if free-market capitalism is the cause of our problems, then the solution must be greater regulation, which generally provides even more scope for the favoritism and corruption that characterize crony capitalism.

While the problem of crony capitalism has been around since states have had favors to dispense, interest in the problem has grown in recent years. Part of this is terminology — the alliterative and finger-pointing nature of “crony capitalism” grabs the attention of general audiences much better than the more neutral sounding “rent-seeking.” But much of it is because the practice of crony capitalism has become so much more blatant in recent years, giving rise to burgeoning research on the topic. In addition to Stockman’s book, such titles asCrony Capitalism in America: 2008-2012 by Hunter Lewis; How Crony Capitalism Crushed the Middle Class and Killed the Economy: Revealing the Economics of Legal Plunder by David Gerson; Ruminations on the Distortion of Oil Prices and Crony Capitalism: Selected Writings by Raymond Learsy; Governor Richardson and Crony Capitalism by Harvey Yates, Jr.; Political Consequences of Crony Capitalism Inside Russia by Gulnaz Sharafutdinova; Crony Capitalism and Economic Growth in Latin America: Theory and Evidence edited by Steven Haber; and Crony Capitalism: Corruption and Development in South Korea and the Philippines by David Kang; to name but a few, have been published in recent years.

Of all these, David Stockman’s book stands out in that the author, as a policy insider in the Reagan administration, saw the phenomenon up close and offers a wealth of detail to which only an insider would be privy. As crony capitalism in the US seems to be attaining Goliath-like proportions, let’s hope that this David’s pen can set in motion a process that will slay the giant.

Robert Batemarco, Mises Institute