Yearly Archives: 2012

The year began with the collective eyes of the country on Iowa in anticipation of the earliest Presidential caucus ever. The January 3 Caucus saw Rick Santorum win by the narrowest of margins, only to end up without a single delegate from the Hawkeye State. Santorum could not hold onto his momentum and lost in New Hampshire, South Carolina, Florida & Nevada before winning ten more contests only to drop out and endorse the eventual GOP nominee, Mitt Romney who lost the general election to President Barack Obama. The GOP faction of the Republicratic Party maintained control of the US House of Representatives, the Democratic faction of the duopoly maintained control of the US Senate and the two sides continue to give the illusion of disagreement.

However, on the important issues, there is little disagreement, at all. Tougher sanctions against Iran passed with little opposition, there was little opposition to Obama’s expanded use of drone warfare, and both factions of the duopoly tried to push internet censorship bills.

Fed Chairman Ben Bernanke announced a third round of Quantitative Easing (QE3), “which came in the form of an open-ended commitment by the Fed to purchase $40 billion of mortgage debt per month until the job market improves.” So, while Bernanke inflates the US Dollar, people are turning to alternative forms of exchange. Bitcoin is one of those alternatives, and is becoming more and more popular everyday. Bitcoin Central, a Bitcoin exchange that is popular in the eurozone, has worked out a deal with Credit Mutuel and Aqoba to allow users in Europe to more easily transfer Bitcoins. This effectively puts Bitcoin Central on par with PayPal as a means of transferring money within the EU.

There were also two stories about very disturbing crimes, which brought the topic of gun-ownership to the public, once again. The first, being a mass shooting at a movie theater in Aurora, Colorado in July; the second being a school shooting at Sandy Hook Elementary in Newtown, Conecticut. This second event has lead both factions of the duopoly to clamor for more laws, with the NRA even supporting a plan to essentially militarize the school buildings. On the same day as the Sandy Hook shooting, a man in China broke into a school and stabbed over 20 people, yet few people talk about knife control legislation. But I digress.

The year was not a total failure for freedom, as two States “legalized” marijuana for personal consumption. Voters in Colorado and Washington actually passed legislation to regulate and tax marijuana, though in a small way it is a victory for liberty, as fewer people will now be imprisoned for enjoying this herb. The Supreme Court, in a round-about way, ruled that individuals do have the right to film police and in June the court overturned portions of Arizona’s “papers, please” legislation.

All-in-all, 2012 could have been better, and certainly could have been worse. Here’s hoping 2013 sees bigger and better things for me and for liberty!

The federal government is nearing the edge of the “fiscal cliff.” The term is used to describe the simultaneous expiration of tax cuts, increase in tax rates and supposedly massive spending cuts. Some argue that allowing the federal budget to be cut by $500 billion across the board will send the economy into another recession and this must be prevented. Others, like Frank Shostak, argue “that a cut in government outlays is actually going to be good news to wealth generators. It is, however, going to be bad news for various nonproductive activities that emerged on the back of increases in government outlays.”

There are more than two options for the federal government to take. One proposal includes having the US Mint produce 2 (or more) platinum coins with a face value of $1 trillion, each. This is an actual proposal by Joseph Gagnon of the Peterson Institute for International Economics. Gagnon is not the first person to mention this idea. During the 2011 “showdown” over the debt-ceiling, Yale Law School Professor Jack Balkin proposed the idea, as did Cullen Roche from Pragmatic Capitalism.

The Washington Post describes the scenario, “the U.S. Mint would produce (say) a pair of trillion-dollar platinum coins. The president orders the coins to be deposited at the Federal Reserve. The Fed then moves this money into Treasury’s accounts. And just like that, Treasury suddenly has an extra $2 trillion to pay off its obligations for the next two years — without needing to issue new debt. The ceiling is no longer an issue.”

Surprisingly, this monetary con-game appears to be perfectly legal. According to 31 U.S.C. § 5112 (k), “The Secretary may mint and issue platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary’s discretion, may prescribe from time to time.”

This new money would solve everything, right? Balkin now says the platinum coin option is “very uncertain, and… could lead to complicated litigation.” And Gagnon claims, “There’s nothing that’s obviously economically problematic about it.” Gagnon’s statement couldn’t be farther from reality.

Whenever anyone creates money out of thin-air, there are going to be economic problems. Gagnon also claims that the “government would simply be using the money to keep spending at existing levels, so it wouldn’t create any extra inflation. And if it did cause problems, the Fed could always counteract the effects by winding down some of its other programs to inject money into the economy.”

Yes, injecting money into the economy to solve the problems created by injecting money into the economy sounds like a wonderful idea. Maybe the next time I’m on a sinking boat, I’ll try putting more water into the boat to keep the boat from sinking. It is past time for Congress to admit publicly the debt will never be paid off and repudiate the debt, because it is invalid.

Every year or two a proposal comes forth that would abolish the $1 bill and “replace it” with a dollar coin. Such a switch would save estimated $4.4 billion over 30 years or roughly $147 million per year (a drop in the bucket when compared to the federal budget of $3.7 trillion). The latest projection from the Government Accountability Office come as Congress begins exploring new ways for the government to save money by changing the money itself.

The Motley Fool reports a House subcommittee hearing in late November focused on two approaches:

• Moving to less expensive combinations of metals like steel, aluminum and zinc.
• Gradually taking dollar bills out the economy and replacing them with coins.

Lorelei St. James of the Government Accountability Office told the House Financial Services panel it would take several years for the benefits of switching from paper bills to dollar coins to catch up with the cost of making the change.

St. James added, “we continue to believe that replacing the note with a coin is likely to provide a financial benefit to the government” and added that such a change would work only if the note was completely eliminated and the public educated about the benefits of the switch.

Benefit the government? The government benefits by controlling the production of currency and from the existence of legal tender laws.

Why not support a proposal that would benefit everyone? I believe the proposals to replace the $1 bill with a $1 coin are bad, not because they would impose on the people a coin they don’t want to use, but rather because it continues to invoke legal tender laws and government control of the currency. A much better alternative is legislation to repeal the legal tender law; abolish the central bank; repeal the government monopoly over the creation of coins for use as currency and prohibit federal and state taxes on precious metal coins and bullion.

The culture of social media is changing the world for the better in many ways. There is a flip side though. Established institutions are getting better at manipulating the stories that are told on social networks. Governments and corporations put significant time and money into crafting stories that they hope will go viral. Most of this effort is wasted. When it works though, the benefits for that organization are enormous.

The New York Police Department (NYPD) is the closest thing to a totalitarian organization you can find in the United States. 21st Century New York City is a theme park for the world’s rich. The NYPD is given 3.9 Billion dollars a year to keep the janitorial staff of that theme park in line. It may deserve some credit for the city’s fall in crime, but not as much credit as it is given. Crime is falling throughout the United States and it is doing so without the NYPD’s extreme and racist tactics. The NYPD is currently under fire for many of its practices. Its policy of stopping and frisking law-abiding pedestrians at random is currently being challenged in court because 87% of its victims are black or latino. The NYPD famously spent six years illegally spying on New York City’s Muslim community at the cost of millions of dollars, and failed to produce a single credible accusation of terrorism. Up until recently they were also using the stop and frisk program to arrest 50,000 people a year for marijuana possession, despite the fact that New York City de-criminalized possession in the 1970s (victims were forced to publicly display the marijuana, which is still illegal). The NYPD’s appearance in serious news lately has largely been due to fall out from one of these scandals.

What is it most known for this week though? How are people all over the country hearing about the NYPD for the first time?

The story goes like this: Larry DePrimo, a “handsome” young officer according to People Magazine, noticed a shoeless homeless man in Times Square on the night of November 14th. It was a “cold November” night according to the New York Times, and Officer DePrimo was inspired to go to the local shoe store and buy the man some boots. This spontaneous act of charity was spontaneously recorded by Jennifer Foster of Arizona, who was inspired to email her story to the NYPD. According to her interview on the Today Show, Ms. Foster did this because her father was a police officer who often provided winter boots to homeless people in Phoenix, Arizona.

Every element of this story strains credibility. New York City is a large, progressive Northeastern City with a well developed shelter and social services network. As inspiring as DePrimo’s choice to buy boots for this guy may be, it probably would have made more sense to get him to a shelter. DePrimo’s “heroism” may have wasted an opportunity to get this guy off the streets and into subsidized housing. This officer is also surprisingly sensitive to cold. The Huffington Post: “I had two pairs of wool winter socks and combat boots, and I was cold,” DePrimo said Wednesday”. The weather recorded at Laguardia on November 14th was a high of 59 and low of 39, which this Tri-state area native has always seen as T-shirt weather.

If this story is not the transparent publicity stunt it appears to me to be, allow me to apologize to DePrimo and Foster. If the story is completely true, they are better human beings than I could ever hope to be.

Even if the story proves not to be, its treatment is definitely bull$*!t. This “news” was “reported” on the NYPD Facebook page, which is essentially a 21st century press release. Its details have been repeated verbatim, presumably with little fact checking, by every major news outlet in the country. This would not have been a story before Facebook. The news is the fact that the picture is a viral sensation. That is the story, and the only thing that national outlets really have to verify.

Every story prominently and positively points to the NYPD brand, and most of them do so in the headline, producing more viral brand love for the NYPD. None of these stories point to the institution’s deeply troubling past and present. If nothing else, this story has proved the utility of Facebook pages for large organizations.

Rob Morris is suspicious of a lot of things. He is particularly suspicious of the Drug War and American Foreign Policy.

The Salt Lake Tribune reports, “This season appears to mark the end of Black Friday as we know it.” Well, that’s not exactly good news. ShopperTrak, a website which counts foot traffic in retail stores, estimated Black Friday sales of $11.2 billion. Bill Martin, founder of ShopperTrak, said, “More retailers than last year began their ‘doorbuster’ deals on Thursday, Thanksgiving itself. Those Thursday deals attracted some of the spending that is usually meant for Friday.”

It now appears that Black Thursday is here to stay. The Salt Lake Tribune also reports, “Lured by earlier-than-ever Black Friday sales, people left Grandma and Grandpa in search of Samsung and Toshiba. They did not go blindly. In dozens of interviews, people acknowledged how spending has become inseparable from the holidays. Older folks pined for the days of Erector Sets and Thumbelinas while in line to pay iPad prices. Even some younger shoppers said it felt wrong to be spending money instead of quality time with family on Thanksgiving… Some said that the Black Friday bleed into Thursday crossed a line, that merchants should not intrude like this. Yet amid these protests, people still talked about feeling powerless beneath the moment — as if they had no choice but to shop.”

I do not support the “consumerism” associated with holidays. As a matter of fact, I like the idea of Buy Nothing Day. However, I understand if people do need to make legitimate purchases, such as food, fuel or other essential items.

Don’t get me wrong, I do not oppose the idea of businesses offering good deals on items. What I oppose is the false sense of urgency on these deals. I oppose the tactic of using loss-leaders to get people into your store in the hopes that they will but things they probably don’t want or need and can’t afford. I like the idea behind Plaid Friday, Small Business Saturday and even Cyber Monday despite the fact that all three gimmicks, in some way, entice consumerism, which I oppose. I also find it ironic that American Express is a sponsor of Small Business Saturday, but I digress.

Whether or not Black Friday becomes Black Thursday or even Black Wednesday, I believe that businesses should offer products at an affordable price every day of the year and consumer’s should be smart enough not to purchase what they can’t afford.