Laissez Faire Links: Nationalization of Google and Amazon, Tax ‘Inversion’, Government Waste…This is the Idiocracy of Bureaucracy

Laissez Faire Links: The Idiocracy of Bureaucracy

government-waste

Today’s set of links focus on government intrusion and waste.  Whether trying to snuff out global corporations altogether via nationalization, wasting tax-payer money on grandiose renovations of bureaucratic headquarters, or political punditry calling corporations unpatriotic because they won’t pay for the renovations of bureaucratic headquarters, these links demonstrate the idiocracy of bureaucracy.

  • As if government has not become intrusive enough, Richard Eskow at Salon actually called for the nationalization of Google and Amazon.  In the “You didn’t build that” egalitarian logic fashioned by Obama, Eskow states: “Big Tech was created with publicly developed technology.  No matter how they spin it, these corporations were not created in garages or by inventive entrepreneurs. The core technology behind them is the Internet, a publicly funded platform for which they pay no users’ fee. In fact, they do everything they can to avoid paying their taxes.”  Yes folks, you read that right.  A policy analyst from the Campaign for America’s Future (more irony in that title) openly called for the government takeover of two of the largest global companies.  As if the government could run Amazon.com better than healthcare.gov.
  • As for corporate “tax-dodging,” here is another piece over at Reason worthy of mention regarding what the Left is calling “Inversion,” whereby corporations relocate for lower tax rates.  The Left calls this unpatriotic, and Sloan saddles the corporation with the task of lifting inefficient government out of the trench when he states,

And I define ‘fiduciary duty’ as the obligation to produce the best long-term results for shareholders, not ‘get the stock price up today’. Undermining the finances of the federal government by inverting helps undermine our economy. And that’s a bad thing, in the long run, for companies that do business in America.”

Since when should the vitality of federal coffers be of concern to corporate executives.  When the federal government has such a heavy hand in the economy that its fiscal concerns bleed into those of private corporations, the free market becomes shackled with all the inefficiencies of government.  And this is what smart business recognizes and seeks to remedy when moving overseas.

  • Inefficiencies abound, Daniel Mitchell over at Cato shares another example of government waste, although this one has a particular tinge of irony that one cannot fail to acknowledge.  According to the Daily Signal, costs of renovating rented office space for the new Consumer Financial Protection Bureau (ushered into law by Dodd-Frank) is about $590/sq. ft., more than either the Bellagio Hotel and Casino or the Trump World Tower.  This renovation alone will cost tax payers $215 million.  So much for protecting consumers!  Parasitic public sector waste will quickly eat any costs saved by consumers from any apparent predatory behavior.

Waste and bureaucratic inefficiencies are exactly what healthy and rational corporations seek to avoid, not to mention the prospect of nationalization.  Why is it surprising that U.S. companies seek lower tax rates overseas when ours are nearly 35%?  This is the rational choice, a practice on which successful corporations build, thereby securing growth and a brighter future for everyone.  Idiotic calls for nationalization and government waste discourage business creation and sap vitality from the markets because they threaten freedom of contract and property rights while saddling corporations with external costs and the mounting inefficiencies of growing bureaucracy.

 

 

 

 

Laissez Faire Links: Social Obligation in Obamacare, ObamaRetire?, Progressives vs. Madisonians, Minimum Wage Revisited

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LAISSEZ FAIRE LINKS

  • Is there a social obligation for me to provide my neighbors’ opportunity to receive healthcare?  What about if his provision negates mine?  Rituparna Basu at the Ayn Rand Institute throws down the argument from social obligation used by proponents of Obamacare.  One’s only “right” to healthcare rests on one’s moral requirement to earn the best healthcare he or she can, not one’s right to receive it at the expense of someone else.  She also gives a comprehensive overview of how Obamacare will greatly limit younger Americans and what we can do to move forward.
  • Ari Armstrong at The Objectivist Standard Blog asks “Is ObamaRetire Next?”  Now that Progressives have our healthcare, they want our retirement accounts as well.
  • Judge Napolitano writes an informative piece contrasting the progressive status quo with the more liberty-loving Madisonians.  The latter founded America on the principle of individual liberty and limited government.  The Progressives, a title encompassing most of Washington, seeks to turn this idea on its head, placing the State as the first and final arbiter of personal liberty.

“Note that Obama doesn’t say that “America deserves a raise” because low-wage workers have suddenly become more productive and, therefore, more valuable to their employers. No, he says that they deserve it because “nobody who works full time should have to live in poverty.” What about the consequences of the minimum wage? Consequences be damned! What about the businessman who must make ends meet and can only pay a wage for unskilled labor that is lower than the minimum wage? Businessmen be damned! What about the workers who are willing to work for lower than minimum wage, but will be laid off or replaced by automated teller machines and other automatic processes? Workers be damned! The minimum wage is right! It makes us feel moral! Reality be damned!”

Laissez Faire Links: Minimum Wage, Rational Patriotism, Equality, and Obamacare

Government rights-violating policies take on many forms these days.  Below are a few issues circulating throughout Washington, the press, and the blogosphere.

The first piece is a wonderfully impassioned lashing against the Left and their refusal to acknowledge the economic reality that a minimum wage imposes on unskilled workers.  Yaron Brook, Director of the Ayn Rand Institute attacks the false logic behind a minimum wage raise, and it has nothing to do with economics.  Rather, it is coated with a thick malaise of altruistic do-goodedness.  He hits the nail on the head:

“The economic case against the minimum wage is easy to grasp. When the government artificially raises the price of something, the demand for it goes down. Raising the minimum wage decreases the demand for unskilled labor (usually the young).

Raising the minimum wage feels good because it appeals to the prevailing altruism in the culture.

Many people understand that the minimum wage defies economic reality. What we need are more people to understand that the morality of altruism defies reality. Human life and happiness require freedom, including the freedom to compete on the labor market with lower wages — yet this is the very reality the altruists want us to ignore in the name of the “poor.” That’s why it’s impractical — and any policy based on it will be destructive.

To move toward freedom — to defeat the senseless and immoral absurdity that the minimum wage represents — it is altruism that must be defeated.”

Full Article here: The Minimum Wage vs. Reality

 

Michael A. Laferrara, writing for The Objective Standard Blog uses government taxation of American corporations overseas to define patriotism in terms of what is rational for a better America, not a more intrusive American government.  “Rational patriotism does not mean throttling productive citizens for the sake of politicians and bureaucrats. Rational patriotism in America means loyalty to what America stands for: the inalienable rights of individuals to life, liberty, property, and the pursuit of happiness.”

Citizens for Tax Justice versus Rational Patriotism

 

Next is a rebuttal of Thomas Picketty’s book Capital in the Twenty-First Century.  Picketty argues that income inequality has increased because investments grow faster than wages.  His solution?  Legislate an 80 percent wealth tax on the rich.  John Stossel at Reason counters that despite the Left’s concern over income inequality, income mobility in America is still very much alive.  More importantly, economic mobility is a result of the free market, and thus, logically, cannot be legislated.  It continues in spite of a natural inequality in living standards. The issue is then one of liberty rather than equality.

Debunking Popular Nonsense About Income Mobility in America

For a strictly Objectivist take on Picketty’s argument in Capital, see Yaron Brook’s response here.

 

Just as the government would like to legislate economic equality, the urge to legislate a nation’s collective living standard is akin to Obama legislating better healthcare.  Don Boudreaux, Professor of Economics at George Mason University, brings this flaw of logic to light.  Legislating universal access to a scarce item certainly does not guarantee any degree of quality.  In fact, basic economics tells you that mandating a minimal quantity of any commodity will lower the quality of that item due to the basic law of scarcity.

Dear Mr. Krugman

 

Let us summarize these four issues and the government’s position on them.  Let us mandate that employers pay wages higher than they would normally pay for a given skill set, forcefully redistributing wealth to less productive avenues.  Let us tax successful corporations for being successful, forcefully taking and redistributing capital to less productive avenues such as the welfare state.  Let us ignore income mobility, the manifestation of which is hope, focussing only on income inequality and turning what is a natural occurrence of diversity and freedom into a scapegoat for more taxation, spending programs, and laws.  So we have forced redistribution of wealth, forced redistribution of capital, and a blatant denial of natural facts for smoke-and-mirror rationalization.  Oh and let us not forget the Obama administration’s false equation of quantity of healthcare received to quality of healthcare produced.

Does this sound like a rights-respecting or rights-violating government?

 

Laissez Faire Links: Government Shutdown, Delaying the Obamacare Mandate, the Morality of Abortion, and Myths Against Capitalism

What would a proper government shutdown look like?  Why will President Obama need to delay his mandate provision?  Can a woman be charged with homicide for aborting her baby?  Did capitalism cause the 2008 financial crisis?

  • Ari Armstrong over at The Objective Standard talks about a government shutdown that would be welcomed.  His brief piece Toward a Shutdown to Celebrate makes the point that most government functions are superfluous, and there are many.  Beneath the umbrella of laissez-faire capitalism, the proper function of government is strictly limited to protector of individual rights.  He states, “In order to protect rights, the government needs to run an effective military, police force, court system, and the aspects of government necessary to support them. Those, and nothing else, are the essential functions of government.”
  • Forbes contributor Scott Gottlieb discusses problems the new government healthcare exchanges are having out of the gate.  Why President Obama Will Have To Delay His Health Insurance Mandate makes the case that technical problems with the virtual exchange rollout will necessitate a delay in the requirement for those uninsured to purchase coverage.  His prognosis is not optimistic: “The Administration started building these systems late, and rushed them online, without perfecting these networks. Working them out now, in real time, is going to take months, and maybe a year.”  With that large of a delay, the Obama Administration will have to backpedal on its threat to penalize the uninsured.
  • Just a little more from our friends at The Objective Standard tells us about a possible Colorado ballot measure that would effectively criminalize any and all abortions, even in cases of rape and incest.  The measure would go further though.  In addition to calling for “homicide prosecutions for killing the unborn,” the “Brady Amendment” violates a women’s moral right to choose how she lives and what is best for her and her body.
  • Did Capitalism Cause the Financial Crisis?  This is a short, but invaluable video regarding the common myth that capitalism failed, resulting in the 2008 financial meltdown. Yaron Brook, Director of the Ayn Rand Institute, states that this is erroneous because a true system of laissez-faire capitalism did not exist prior to 2008.  What did exist was a degree of government intervention that distorted the market, leading to bubbles in asset prices that never would have existed under natural market forces.  It is no coincidence that the three most highly regulated industries – housing, banking, and mortgages – were those that failed.  Pay particular attention to his comments on the Federal Reserve system.  For more information, see my discussions of the Federal Reserve.