Tuesday, 12 February 2013

Wishing for a “living wage”

Unions are calling for a “living wage” for everyone of at least $19 per hour, enforced by government on every employer. People “need” this they say, therefore they should have it.

This idiocy is not primarily economic—although economist Matt Nolan does give it a thorough spanking, pointing out that “by imposing a ‘price floor’ you are ensuring there are a group of people who can’t get jobs and will get hurt—but unions don’t care because they don’t represent the unemployed.”

See, it is idiotic. But the idiocy is not primarily economic; the idiocy is primarily philosophic. You see, these people are utterly blind to causality. They see no connection at all between how much a person can produce and how much they are able to consume: as if wishing for a loaf of bread were enough on its own to bring that bread on your plate. They se no causal chain connecting what is produced and what is consumed: as if the two were separate things going on with no reference to each other. They see no causal link at all between between production and consumption: as if need itself is sufficient to set the wheels of production in motion.

Yet not an ocean of tears nor a plane-load of hand-wringing former Hobbit actors can bring into existence the bread you will need tomorrow—not unless those hand-wringers are able to put those hands into productive ends.

Taken seriously, the call for this “living wage” is nothing but a whim—that is, “a desire experienced by a person who does not know and does not care to discover its cause.”

The thing these people need to learn is that wishing doesn’t make it so. Reality just isn’t made that way.

“Let them come”

New Zealanders and Australians like to think they are charitable folk. They like to think they are caring, sharing and good hearted towards others. They sit warm and self-satisfied in that thought, right up until the point that those “others” come to our places by boat—and right at that point these good-hearted folk are happy to have these other folk, these other human beings escaping desperate situations, held up at the point of a gun and thrown into detention centres that are little more than concentration camps.

So much for the virtue of benevolence.

It seems benevolence ends where the welfare state begins.

The Welfare State forces every person to be responsible for every other person, whether they like it or not. And like it or not, those who pick up the cheque for New Zealand's welfare state resent that forced imposition.

The Welfare State dehumanises people—forcing us to view another human being as either a wallet or a mouth—upsetting those with the wallets at the prospect of many more mouths being fed at their expense.

The existence of the Welfare State means that instead of seeing every other human being as a potential gain to ourselves, which is what they are, instead we see them as just another mouth to feed and a family to house.

This is criminally wrong.

This is the way the Welfare State is. It is a State in which every human being is set against every other human being.

What we should abhor is not the existence of “boat people”—people in a desperate situation yearning to breathe free, whom we dehumanise by that disgraceful epithet—but the existence of this “forced charity.”

It is all force, and no charity.

There is a better way to deal with immigrants and refugees than with guns, camps and a death sentence.

As author Robert Heinlein suggested, successful immigrants demonstrate just by their choice and gumption in choosing a new life that they are worthy of respect. So why can’t we?

Why not simply let people look after them voluntarily?

This shouldn’t be difficult. Every time an issue like this comes to light, many charitable New Zealanders and Australians raise their voices in support of the embattled minority; so why not take these calls literally?

Instead of announcing that New Zealand is about to buy into Australian inhumanity, Prime Ministers Key and Gillard could instead have announced that between them they will accept whoever arrives on our shores, but only as long as a sufficient number of charitable Australians and New Zealanders can be found to take full responsibility for them until they are on their feet. People who will offer their own voluntary welfare and 'naturalisation services' to help these people start their new life.

Who could possibly, or reasonably, object to that?

Finding a sufficient number should not be a problem. Even the numbers gleefully posted every week by xenophobes like new-Australian Andrew Bolt  only measure in their hundreds--a “flood” of several-hundred souls at most trying to “pour” into a country of 20-million people and a thousand-million empty acres.

And given the initiative refugees will have already shown in getting down here, I would expect that getting on their feet will not take them very long.

This solution demonstrates the stark contrast between generosity and enforced charity, and the simple benevolence at the heart of the libertarian philosophy.

Compulsory 'charity' is a misnomer - it dehumanises both taxpayer and recipient. But when charity is voluntary, people are set free to be benevolent again.

The Welfare State is a killer for benevolence, for the human spirit, for open immigration, and a literal killer for immigrants and refugees braving dangerous waters and the integrity of unscrupulous people-smugglers.

I say set these people free through the generosity of benevolent New Zealanders—while taking a good hard look at what the Welfare State does to people.

I say that the simple libertarian philosophy be adopted with all immigrants, including refugees: that until the Welfare State we endure is permanently dismantled we simply allow all peaceful people to pass freely just as long as they make no claim at all on our enforced charity.

I say Let Them Come.

The principle of individual rights demands it.

Monday, 11 February 2013

QUOTE OF THE DAY: On drugs and match-fixing

Couple recent revelations about drugs and match-fixing in everything from cycling to soccer and from boxing to all the pointy ball codes, with the modern proliferation of so many giggle games and meaningless sporting contests promoted simply in order to get bums on seats regardless of the bums interest in the contest—with all that in mind, this comment from today’s Footy Almanac seems to hit the mark:

“The more meaningless the game is, the more open it will be to the match-fixers.  Something that applies across all codes.”
        Sal Ciardulli, “A big couple of days in sport,” THE FOOTY ALMANAC

SUMMER SNIPPETS: ‘Frederic Bastiat: A Man Alone’

Frederic Bastiat: A Man AloneFrederic Bastiat was the nineteenth century’s great economic populariser of free trade, and probably the most entertaining debunker ever of economic baloney. Here are a few snippets from my summer reading of his biography by George Charles Roche: A Man Alone.

As Bastiat’s fame spread and his arguments favouring free trade appeared in various newspapers and pamphlets throughout France, he immediately became the target for numerous public attacks…  Every half-truth and non-truth imaginable was trotted out by opponents of free trade….
    “Bastiat kept his temper and published refutations of the entire protectionist position, demolishing his opposition with simple language and easily-understood examples. Throughout, Bastiat reflected a sense of humour that illuminated the foibles of his age and which made the hard facts and tight logical analysis of his position far more popular and palatable than the usual grim preaching by reformers  Fredric Bastiat was perhaps the first of the ‘happy libertarians,’ a special breed who are at once a delight to their friends and a thorn in the side of their enemies.”

Bastiat returned to his central themes again and again: the myth of “overproduction”; emphasis up on the interests of the consumer (reminding his readers that we are all consumers); and special emphasis upon the idea that a fundamental harmony pervaded the free market place… Building on Adam Smith [and J.B. Say], Bastiat stressed that fee exchange permitted a division of labour, 
        ‘…which makes it possible for each man, instead of struggling on his own
    behalf to overcome all the obstacles that stand in his way, to struggle
    against only
one, not solely on his own account, but for the
    benefit of his fellow men, who in turn perform the same service for him.’
“Thus, specialisation leads to increased production of those items most desired by consumers, at a price which the consumers themselves are willing to pay.  In free exchange, then, a natural harmony exists between production and consumption, between specialists and consumers of the speciality, provided only that … voluntary choice and free choice prevail.
     “As Bastiat wrote:
        ‘For a man, when he gets up in the morning, to be able to put on a suit of clothes, a piece of land has had to
    be enclosed, fertilized, drained, cultivated, planted with a certain kind of vegetation; flocks of sheep have had
    to feed on it; they have had to give their wool; this wool has had to be spun, woven, dyed, and converted
    into cloth; this cloth has had to be cut, sewn, and fashioned into a garment. And this series of operations
    implies a host of others; for it presupposes the use of farming implements, of sheepfolds, of factories, of coal,
    of machines, of carriages, etc.
        ‘If society were not a very real association, anyone who wanted a suit of clothes would be reduced to
    working in isolation, that is, to performing himself the innumerable operations in this series, from the first
    blow of the pickaxe that initiates it right down to the last thrust of the needle that terminates it.
        ‘But thanks to that readiness to associate which is the distinctive characteristic of our species, these
    operations have been distributed among a multitude of workers, and they keep subdividing themselves more
    and more for the common good to the point where, as consumption increases, a single specialized operation
    can support a new industry. Then comes the distribution of the proceeds, according to the portion of value
    each one has contributed to the total work. If this is not association, I should like to know what is…
         ‘Do not this division of labor and these arrangements, decided upon in full liberty, serve the common good?
    Do we, then, need a socialist, under the pretext of planning, to come and despotically destroy our
    voluntary arrangements, put an end to the division of labor, substitute isolated efforts for co-operative
    efforts, and reverse the progress of civilization?’”

imageThe 1840s in France had spawned a host of enemies for the Bourgeois Monarchy…  Though [the Second Republic]  was finally established under Lamartine, he and his fellow members in the government never recovered from the enormous surprise involved when they found themselves in charge of the French state… 
    “Lamartine had already been a major political figure and a member of the Chamber of Deputies before the February Revolution.  He and Bastiat had ben in correspondence for some three years before the Revolution…  In fact, Lamartine had written to Bastiat shortly before the outbreak of revolution, ‘If ever the storm carries me to Power, you will help me carry out our ideas.’  Bastiat was apparently offered a high position in the new regime, but preferred to retain his freedom of criticism.
    “And criticise he did.  When Lamartine began to make speeches referring to the necessity for fraternity as enforced by government in various social welfare measures, Bastiat immediately rose to the occasion:
        ‘I happened to discuss this question with the eminent gentleman whom the Revolution lifted to such great heights.  I said to him, "Only justice can be demanded from the law, which acts by means of coercion." 
    ‘He thought that people can, in addition, expect fraternity from the law. Last August he wrote me: "If ever, in a time of crisis, I find myself placed at the helm, your idea will be half of my creed."And I reply to him here: "The second half of your creed will stifle the first, for you cannot legislate fraternity without legislating injustice"…
    ‘When, under the pretext of fraternity, the legal code imposes mutual sacrifices on the citizens, human nature is not thereby abrogated. Everyone will then direct his efforts toward contributing little to, and taking much from, the common fund of sacrifices. Now, is it the most unfortunate who gain in this struggle? Certainly not, but rather the most influential and calculating.’
“Such frankness was not calculated to make Bastiat a favourite of the new regime.”

Lamartine proposed a national exposition, to be financed by government funds.  He had pointed out how the expenditure of of those government funds would be a tremendous boost to employment, painting a moving picture of all the painted, masons, decorateros, costumers, architects, and all other workmen who would thus find their position improved and who would then be able to provide necessities for themselves and fro their children.  Lamartine concluded his speech to the Assembly amidst cheers and approval, insisting, ‘It is to them that you give these 60,000 francs.’
    “To the Assembly’s cries of ‘Very good!’, Bastiat replied, ‘Very bad!’:
        ‘Yes, it is, at least in part, to the workers in the theatres that the sixty thousand francs in question will go. 
    A few scraps might well get lost on the way.  If one scrutinised the matter closely, one might even discover
    that most of the pie will find its way elsewhere.  The workers will be fortunate if there are a few crumbs left
    for them!  But I should like to assume that the entire subsidy will go to the painters, decorators,
    costumers, hairdressers, etc.
That is what is seen.
        ‘But where does it come from?  This is the other side of the coin, just as important to examine as its face. What
    is the source of those sixty thousand francs?  And where
would they have gone if a legislative vote had not
    first directed them to the Rue de Rivoli and from there to the Rue de Grenelle [i.e., from the tax department to
    the theatrical suppliers in the Left Bank.] 
That is what is not seen.
        ‘Surely, no one will dare maintain that the legislative vote has caused this sum to hatch out from the ballot
    box; that it is a pure addition to the national wealth; that, without this miraculous vote, these sixty
    thousand francs would have remained invisible and impalpable. It must be admitted that all that the
    majority can do is to decide that they will be taken from somewhere to be sent somewhere else, and that
    they will have one destination only by being deflected from another.
        ‘This being the case, it is clear that the taxpayer who will have been taxed one franc will no longer have
    this franc at his disposal. It is clear that he will be deprived of a satisfaction to the tune of one franc, and that
    the worker, whoever he is, who would have procured this satisfaction for him, will be deprived of wages in
    the same amount.
        ‘Let us not, then, yield to the childish illusion of believing that the vote of May 16
adds anything whatever
    to national well-being and employment. It reallocates possessions, it reallocates wages, and that is all…
        ‘When it is a question of taxes, gentlemen, prove their usefulness by reasons with some foundation, but not
    with that lamentable assertion: "Public spending keeps the working class alive." It makes the mistake of
    covering up a fact that it is essential to know: namely, that
public spending is always a substitute for
    private spending, and that consequently it may well support one worker in place of another but adds nothing
    to the lot of the working class taken as a whole. Your argument is fashionable, but it is quite absurd, for
    the reasoning is not correct.’

As he wrote in a troubled moment, ‘… the worst thing that can happen to a good cause is not to be skilfully attacked, but to be ineptly defended.’”

Bastiat was tireless in striking down error wherever it appeared.  He defended the classical economic position as set forth by Thomas Malthus, pointing out that the English economist had far more in mind than the constantly quoted passage in which he had discussed the arithmetic and geometrical qualities of the food supply and the population.  Bastiat understood that Malthus was entirely mistaken about the ultimate prospects for starvation of eth human race, and yet had great merit as a proponent of classical economic principles. Once Bastiat publicly challenged Pierre Leroux, a French philosopher and editor of Le Globe after Leroux had written a chapter against Malthus.  Bastiat … realised as he pursued the point that Leroux did not actually know the work of Malthus.  Never one to do things by half, Bastiat asked, ‘You have refuted Malthus, but have you by any chance read him through from one end to the other?’
    “ ‘I have not read him at all,’ Leroux replied.  ‘His whole system is set forth on one page and can be summed up in his famous arithmetical and geometrical rations.  That’s enough for me.’
    “ ‘Apparently,’ Bastiat said, ‘you care nothing for the public, for Malthus, for the truth, for conscience, for yourself.’”
    “That night, Bastiat wrote:
        ‘This is the way an opinion gains acceptance …  Fifty ignoramuses repeat in chorus some absurd libel that
    has been thought up by an even bigger ignoramus; and, if only it happens to coincide to some slight degree
    with prevailing attitudes and passions, it becomes a self-evident truth.’”

Time was running out for the Second French Republic, and for Frederic Bastiat [who though he had contracted tuberculosis, continued to work feverishly].  Bastiat well knew that the end was in sight, not only for his mortal efforts, but for the sick republic which staggered on toward its rendezvous with the man on horseback: Louis Napoleon.
    “Even as the committee met to draw up the constitution for the Second French Republic, the Republic was expiring.  The Committee for the Constitution itself gave evidence of eth sad state of affairs in France.  Personally acquainted with the members of the committee whose duty it was to draft a new constitution for France, Alexis de Tocqeuville regarded some of them as ‘chimerical visionaries.’  One committee member, Victor Considerant, Tocqueville found especially discouraging: ‘ … he would have deserved to be sent to a lunatic asylum had he been sincere—but I fear he deserved more than that.’  Tocqueville described the other committee members  as being totally unaware of any lasting principles or purposes, totally bewildered at the prospect of deciding the course of action for France:
        ‘All this bore very little resemblance to the men, so certain of their objects and so well acquainted with
the measures necessary to attain them, who sixty years before successfully drew up the American Constitution.’
“When it was drawn up, the constitution [for the French Second Republic] proved almost unbelievably complex, guaranteeing a deadlock between President and Assembly, and almost insuring a dictator would step forward to break the impasse.  The would-be dictator was ready at hand.  [Bonaparte’s’ nephew] Louis-Napoleon Bonaparte [known subsequently by the uncomplimentary sobriquet “Napoleon the Little”] had twice attempted inept coups and each tome dismissed with little more than a pat on the head... [Now however] in the balloting for the first President under the new Constitution, so many of the French leaders threw their support to Louis Napoleon, sure that here was a man the politicians could control.  How mistaken they were…
    “In Tocqueville’s phrase, ‘…the world is a strange theatre.  There are moments in it when the worst plays are those which succeed best.  If Louis Napoleon had been a wise man, or a man of genius, he could never have become President of the Republic.’  In perspective, it becomes clear the French were unable to achieve either lasting stability or a free society because they could not cope with their deeply inbred tradition of centralisation…
    “[Within a year Napoleon the Little had dissolved the Legislative Assembly, thrown all opposition members into prison, and proclaimed himself first President-for-Life, then Emperor.] Few Frenchmen were astute enough to recognise what had happened to them.”

Even in the final laps of his race with death, Bastiat found tome to analyse the French political scene and accurately predicted the end of Republican government in France. During June of 1850 he retried to [his home at] Mugron for a few days where he write the most famous and compelling of his books, The Law.  In this work, and in the other pamphlets, letters and essays he write during the last few months of his life, Bastiat described why no society could hope to endure under any political regime that denied freedom to its citizens:
        ‘No society can exist if respect for the law does not to some extent prevail;
    but the surest way to have the laws respected is to make them respectable.
    When law and morality are in contradiction, the citizen finds himself in the
    cruel dilemma of either losing his moral sense or of losing respect for the law,
    two evils of which one is as great as the other, and between which it is
    difficult to choose…
        ‘Unfortunately, the law is by no means confined to its proper role. It is not
   only in indifferent and debatable matters that it has exceeded its legitimate
   function. It has done worse; it has acted in a way contrary to its own end; it
   has destroyed its own object: it has been employed in abolishing the justice which
    it was supposed to maintain, in effacing that limit between rights which it was its mission to respect; it has
    put the collective force at the service of those who desire to exploit, without risk and without scruple, the
    person, liberty, or property of others; it has converted plunder into a right, in order to protect it, and
    legitimate defence into a crime, in order to punish it.’

    “Bastiat analysed the interventionist society point by point, and found it wanting in justice on every hand:
        ‘Alas! I find here so many nascent abuses, so
    many exceptions, so many direct or indirect
    deviations, appearing on the horizon of the new
    social order, that I do not know where to

        ‘We have, first of all, licenses of all kinds. No one
    can become a barrister, a physician, a teacher, a
    broker, a dealer in government bonds, a solicitor,
    an attorney, a pharmacist, a printer, a butcher, or
    a baker without encountering legal restrictions.
    Each one of these represents a service that is
    forbidden by law, and hence those to whom
    authorization is granted raise their prices to such a point that the
    mere possession of the license, without the service, often has great value….

        ‘Next comes the attempt to set an artificial price, to receive a supplementary value, by levying tariffs,
    for the most part on necessities: wheat, meat, cloth, iron, tools, etc. This is … a forcible violation of the
    most sacred of all property rights, that to the fruits of one's labour and productive capacities….
        ‘Next comes taxation. It has become a much sought-after means of livelihood. We know that the number
    of government jobs has been increasing steadily, and that the number of applicants is increasing still
    more rapidly than the number of jobs. Now, does any one of these applicants ever ask himself whether he
    will render to the public services equivalent to those which he expects to receive? Is this scourge about to
    come to an end? How can we believe it, when we see that public opinion itself wants to have everything done
    by that fictitious being, the state, which signifies a collection of salaried bureaucrats? After
    having judged all men without exception as capable of governing the country, we declare them incapable
    of governing themselves. Very soon there will be two or three of these bureaucrats around every
    Frenchman, one to prevent him from working too much, another to give him an education, a third to furnish
    him credit, a fourth to interfere with his business transactions, etc., etc. Where will we be led by the illusion
    that impels us to believe that the state is a person who has an inexhaustible fortune independent of ours? …
        ‘I believe we are entering on a path in which plunder, under very gentle, very subtle, very ingenious
    forms, embellished with the beautiful names of solidarity and fraternity, is going to assume proportions
    the extent of which the imagination hardly dares to measure. Here is how it will be done: Under the name
    of the state the citizens taken collectively are considered as a real being, having its own life, its own
    wealth, independently of the lives and the wealth of the citizens themselves; and then each addresses
    this fictitious being, some to obtain from it education, others employment, others credit, others food,
    etc., etc. Now the state can give nothing to the citizens that it has not first taken from them. The only effects
    of its intermediation are … a great dispersion of forces … for everyone will try to turn over as little as
    possible to the public treasury and to take as much as possible out of it. In other words, the public treasury
    will be pillaged. And do we not see something similar happening today? What class does not solicit the favours
    of the state? It would seem as if the principle of life resided in it. Aside from the innumerable horde of its
    own agents, agriculture, manufacturing, commerce, the arts, the theatre, the colonies, and the shipping
    industry expect everything from it. They want it to clear and irrigate land, to colonize, to teach, and
    even to amuse. Each begs a bounty, a subsidy, an incentive, and especially the gratuitous gift of
    certain services, such as education and credit. And why not ask the state for the gratuitous gift of all
    services? Why not require the state to provide all the citizens with food, drink, clothing, and shelter
    free of charge?’
    “And what is the result of thus viewing the law and the state in such a perverted light? Bastiat warned that the price was high, and that the perversion in political terms would finally be a perversion of all social institutions as well, finally destroying society itself:
        ‘The law is no longer the refuge of the oppressed, but the
    arm of the oppressor! The law is no longer a
    shield, but a sword! The law no longer holds a balance in its
    august hands, but false weights and false keys!
    And you want society to be well ordered!
        ‘Your principle has placed these words above the
    entrance of the legislative chamber: "Whosoever
    acquires any influence here can obtain his share of legal
        ‘And what has been the result? All classes have flung
    themselves upon the doors of the chamber, crying:
    "A share of the plunder for me, for me!" …
        ‘And are you not appalled by the immense, radical, and deplorable innovation which will be introduced
    into the world on the day when the law itself is authorized to commit the very crime that it is its function
    to punish—on the day when it is turned, in theory and in practice, against liberty and property?
        ‘You deplore the symptoms that modern society exhibits; you shudder at the disorder that prevails
    in institutions and ideas. But is it not your principle that has perverted everything, both ideas and institutions?’
    “Thus Bastiat perceived the cycle.  Undue government intervention in the lives of men inevitably produces legalised injustice, which leads to a lack of respect for the law, indeed for all authority and institutions.  An immoral social order breeds immoral citizens.  Soon the social fabric itself disintegrates…  He warned that political power was the cause of France’s social decline and could never provide solutions to the problem…
        ‘…there is only one remedy: time. People have to learn, through hard experience, the enormous
    disadvantage there is in plundering one another….
        ‘And this goes on until the people learn to recognize and defend their true interests. Thus, we always reach
    the same conclusion: The only remedy is in the progressive enlightenment of public opinion.’”

When a man has spent his first forty-five years in solitude and quiet preparation, only a crisis which he regards as vitally important will cause him to leave that self-imposed isolation.  For Frederic Bastiat, that crisis was the rampant socialism that so savagely attacked his native France.  And the crisis was sufficiently pressing upon Bastiat that, once he had entered the fray, he drove himself unmercifully to devote all his energies to the task at hand.  His last major work was to be Economic Harmonies, a sustained intellectual effort that literally consumed his life… One great idea filled his mind:
        ‘Men’s interests, rightly understood, are harmonious with one another,
        ‘Men's interests, rightly understood, are harmonious with one another, and the inner light that reveals them
    to men shines with an ever more vivid brilliance. Hence, their individual and collective efforts, their
   experience, their gropings, even their disappointments, their competition—in a word, their freedom—make
    men gravitate toward that unity which is the expression of the laws of their nature and the consummation of
    the common good.’

It was also during these last months that Bastiat write the famous pamphlet “What is Seen and What is Not Seen.” Tragically, Bastiat has lost the entire manuscript during a period when he was relocating his household.  After a careful but unsuccessful search, he decided that the pamphlet was of such importance that it deserved being done again.  This second manuscript did not suit him, and he threw it into the fire.  So he wrote “What is Seen and What is Not Seen” for yet a third time, and this is the form in which we know this classic.”

“[Writing about the future of France] he pointed out that the entire population of France, particularly the poor, had been led to believe that government could somehow satisfy all their needs and desires.  A great “war on poverty” had been promised the French people.  Bastiat warned that the government could not possibly alleviate poverty, since it was government intervention that had caused the hardships:
        ‘Take from some to give to others! I know that this is the way things have been going for a long time.
    But, before contriving, in our effort to banish poverty, various means of putting this outlandish principle
    into effect, ought we not rather to ask ourselves whether poverty is not due to the very fact that this principle
    has already been put into effect in one way or another? Before seeking the remedy in the further disturbance
    of the natural law of society, ought we not first to make sure that these disturbances are not themselves the
    very cause of the social ills that we wish to cure?’
    “Bastiat recognised that a great political revolution had taken place that had given power into the hands of ‘the people.’  He warned that the precedent had already been too well established by the upper classes [represented by the ‘right’ of the Assembly] of feathering their own nest at the expense of others.  Such ideas were sure to spread to the lower classes [[represented by those on the Assembly’s left], producing the ugly spectacle of a society in which everyone was attempting to live at the expense of everyone else.  Soon all classes demand special privileges.  In the absurd rhetoric of the socialist demagogue, such a system is presumably fraternal and egalitarian, with total justice for all concerned:
        ‘And is not this the point that we have now reached? [he wrote.] What is the cry going up everywhere, from
    all ranks and classes? All for one! When we say the word one, we think of ourselves, and what we demand is
    to receive an unearned share in the fruits of the labour of all. In other words, we are creating an organized
    system of plunder. Unquestionably, simple out-and-out plunder is so clearly unjust as to be repugnant to us;
    but, thanks to the motto, all for one, we can allay our qualms of conscience. We impose on others the duty
    of working for us. Then, we arrogate to ourselves the right to enjoy the fruits of other men's labour. We call
    upon the state, the law, to enforce our so-called duty, to protect our so-called right, and we end in the
    fantastic situation of robbing one another in the name of brotherhood. We live at other men's expense, and
    then call ourselves heroically self-sacrificing for so doing. Oh, the unaccountable folly of the human mind! Oh,
    the deviousness of greed! It is not enough that each of us tries to increase our share at the expense of others; it
    is not enough that we want to profit from labour that we have not performed. We even convince ourselves that
    in the process we are sublime examples of self-sacrifice… We have become so blind that we do not see that the
    sacrifices that cause us to weep with admiration as we contemplate ourselves are not made by us at all, but are
    exacted by us of others.’”

Bastiat Collection Pocket Edition

Boxing match? [updated]

That was no boxing match, and those were no boxers—and if you paid good money for it, then you should probably be far more careful where you throw your money in the future.

UPDATE: Read An Action Man doll versus a tattered teddy bear:

“No one who watched Williams fight Botha ended up excited.  They ended up enraged, and I’m not surprised.  I’ve seen enough boxing shams and I don’t want to see anymore.  So please, don’t watch Sonny Bill Williams fight, not until he makes the same decision Mundine did and quit football for boxing.
    “Until he does that, he doesn’t deserve our money.  He couldn’t beat up a faded fighter eighteen years his senior, a man knocked out seven times… And that is the measure of Williams, so ignore him in the ring until he quits football.  I’m going to.  I used to love boxing.  I always hated bullshit.  I can’t stand it when they’re put together.”

Herald failure

Look, it’s great to see the Herald reporting news about Australian Football—even if the only news about AFL they ever bother to report are the scandals—but if they are going to begin regular reporting on the world’s greatest game, which they should now competition games will be played in Wellington beginning Anzac Day, couldn’t their sub-par sub-editors at least try to track down a picture of the sport itself to accompany their stories, rather than a picture of some American Football gear:


Do these blokes look like they play with helmets?

Friday, 8 February 2013

SUZUKI SAMURAI: “I met a young fellow called Nath”

Our roving Asian correspondent Suzuki Samurai (you know who we mean) gets a lesson in obedience over a beer.
I met a young fella the other day called Nath (pronounced Nat), a twenty-year-old who speaks bang-on English. Nath teaches at another school not far from me. He asked me to come and meet his students, which I agreed to do as most of the time outside working hours I spend on nothing more important than counting my navel fluff. I got to Nath’s school at 5pm, as agreed (which surprised him), and entered what appeared to be a rather decent house. In fact it was a ruin rather than a house. (Houses in Cambodia doubling as shops, offices, schools and government buildings … or is it the other way round?)
Anyway…Packed into these unlined, concrete boxes with concrete and dirt floors and filthy ‘classrooms’ were up to sixty wide-eyed, bushy-tailed teenagers marvelling at the foreigner in their midst.  (I really am quite spectacular in these parts, one reason I hang around). I answered the usual ‘where you are come from’? ‘why you go to Cambodia’ broken English stuff, asked a few questions of my own and departed. All very nice.
I met Nath again on Sunday evening – his only day off - for a quiet few at the local tent (bar). He told me there are 700 students attending this school of his (this is a house remember) and that he gets paid $50 per month for six days a week of sixty students.
“Tough job,” I said pouring ice-cold beer down my neck.
Shrugging, he answered, “It’s ok, it doesn't cover my costs each month but I like it.”
With a change of subject I asked, “So what’s it like being a teenager in Cambodia”?
“Well, it’s hard to have an opinion.  You are not supposed to question you parents, especially your father … that’s why nothing changes.” Then he started to talk full time, so I let him, only interrupting to order more beer.
“If your father thinks you should work on the farm growing rice, you have to do as he says. If I want to do something different with my life, I had to talk to my mother about it, and she would kind of tell him in little pieces. He thinks me learning and teaching English is a waste of time, and a waste of his money. I want to tell him that I want to have a different life, but I can’t because that would be rude, and other people will look down on me for doing it. So I just shut up. Most kids live a life like this, and the old people are getting angry because they think that the way they did things was better.”
He went on, “I was a monk; from age fifteen to eighteen. I didn't really want to but my parent s said that if I become a monk then they will be blessed; which is what a son should do to return the favour to them of being born and raised by them.”
“How was that, I asked?”
“Kind of strange when I look back, all we used to do is sit around memorizing the old Buddha language, and going to pray for people; in return they would give us food, or money. Monks can’t eat after noon, only in the morning. Females are not allowed to touch monks, you can only touch your mother in special circumstances like when she is sick, but you have to ask the leader first.”
I grinned and asked, “You were a youth, but you couldn't touch a female? - “Did you think about girls/women?” I asked in a tone so as not to be too crude, even for me.
“No,” he said emphatically, “I never thought about that kind of thing; I don't know why, but for those three years I just didn't .”
“There must have been a lot of meditation,” I said, seeing if he’d pick it up. “Yes, we meditated all the time.” (Obviously not.)
He finished by tell me, “I want to have my own school one day, but first I have to find a way of getting money; I thought of buying a tuk-tuk and driving it to Phnom Penh.”
I suggested that he’d make a great tuk-tuk driver as his English would do him well with the tourists.
His face lit up like a Christmas tree.
As parents do in China, Cambodian parents put enormous obligation on their children, trying to keep them very close and somewhat ignorant. They do this openly and deliberately, telling them that everything they do is for their children, and they do it so that the children can keep them in their old age. The ignorance aspect they might do by not letting them have independence until they get married, and even then it spills over.
Even when it comes to things like getting a driving license, or insurance, or opening a bank account, it is usually the father who organises everything and structures it to keep everyone in need of them. This situation is fading away, but it is only fading away very slowly.
Not everyone can be a tuk-tuk driver in Phnom Penh.

Interplanetary Cessna

Software engineer Glen Chiacchieri asks the pressing question on everyone’s mind:

“What would happen if you tried to fly a normal Earth airplane above different Solar System bodies?”

The answer, courtesy of xkcd, is this…


… reasons for each of which—fascinating reasons—are given here.

[Hat tip Shutists]

The Errors of Keynes

A guest post by Philip Bagus on the appearance of a new book demolishing the pseudo-economics of John Maynard Keynes—in whose name a mountain of debt and a pseudo-golden shower of paper money has been pissed out in recent years to “save the world,” to no positive effect whatsoever.

_KeynesThe Austrian School of economics has provided the world with devastating critics of Keynes's magnum opus The General Theory of Employment, Interest and Money for a long time. Friedrich A. von Hayek, Jacques Rueff, Henry Hazlitt, Murray Rothbard, Ludwig Lachmann, Ludwig von Mises, George Reisman and William Hutt have already provided important arguments against Keynes and Keynesianism.

Now we can add a new name to that distinguished list. In 2012, Juan Ramón Rallo has published a new Austrian critique of TGT in Spanish with the title Los Errores de la Vieja Economía (The Failure of the Old Economics) in honor of Hazlitt's work The Failure of the 'New Economics'.

In Hazlitt's time, Keynes's program was still revolutionary and described by Hazlitt as a kind of “New Economics” that broke with the insights of classical economics and especially with Say's Law. Now, Keynesianism is mainstream. Keynesianism, and especially its main idea that spending reduces unemployment, is still taught in universities, applied by grateful politicians, and prominently defended by the 2008 Nobel Prize winner Paul Krugman.

Indeed, the immediate political response to the current financial crisis in the Western World was inspired by Keynes’s General Theory. A second Great Depression was to be prevented and Keynes's insights applied. Governments engaged in loose monetary policy combined with fiscal stimulus in response to what, through Keynesian eyes, appeared to be a bubble caused by reckless speculation, which was in turn inspired by animal spirits. Thus, even if Rallo's book were just a summary of the old arguments against The General Theory, the moment for publication would be more than appropriate, since the ideas of the past are still the praxis of the present.

Yet, Los Errores de la Vieja Economía is much more than a summary and synthesis of the old arguments by the aforementioned Austrian authors. Rallo builds upon, combines, and develops these arguments in a systematic way. Most importantly, he adds his own innovative ideas to develop a devastating case against Keynes.

Rallo's critique, employing Austrian economic theory, is rigorous, systematic and exhaustive. Significantly, Keynes's ideas are not twisted or distorted. The absence of strawman arguments makes Rallo's attack against the core of Keynesian beliefs stronger than most. Rallo also does not search for terminological contradictions and inconsistencies. In this sense, Rallo's critique is more profound and devastating than for example the parts of Henry Hazlitt's brilliant critique that emphasize Keynes's inconsistencies, imprecision, and explanatory fuzziness. Rallo has a great and genuine interest in giving a clear and coherent picture of Keynes's reasoning and presents Keynes in the most favourable light.

Let's have a look of some of Rallo's arguments, beginning with Keynes's famous critique of Say's Law. Keynes's distorted version of Say's Law in his General Theory states that supply creates its own demand. Rallo vindicates Say's Law in its original version: In the long run, the supply of a good adjusts to its demand. Ultimately, goods are offered to buy other goods (money included). One produces in order to demand, which implies that a general overproduction is impossible.

Hazlitt, Henry

Say's Laws leads us straight forward to the most innovative argument in Rallo's book that addresses the old argument against hoarding. Even harsh critics of Keynes, for example from the monetarist or neoclassical camp, admit that Keynes was at least right in that hoarding is a destabilizing and dangerous activity.

Rallo, however, proves and emphasizes the social function of hoarding. To demand money is not to demand nothing from the market. Hoarding is the natural response of savers and consumers to a structure of production that does not adjust to their needs. It is a signal of protest to entrepreneurs: “Please offer different consumer and capital goods! Change the structure of production, since the composition of offered goods is not appropriate.”

In a situation of great uncertainty, it is even prudent to hoard and not immobilize funds for the long run. Rallo provides us a visual example. Let's assume that uncertainty increases because people expect an earthquake. They start to hoard, i.e., they increase their cash balance, which gives them more flexibility. This is completely rational and beneficial from the point of view of market participants. The alternative is to immobilize funds through government spending. The public production of skyscrapers is not only against the will of the more prudent people; it will also prove disastrous if the earthquake is realized.

Hoarding is an insurance against future uncertainties. Rallo argues that, if the demand for money increases (i.e., liquidity preference increases) due to the precautionary motive, short-term market rates of interest tend to fall, while long-term rates increase. People invest more short term and less long term in order to stay liquid. This leads to an adjustment of the structure of production. More resources will be used for the production of the most liquid good (i.e., gold in a gold standard), and for the production of consumer goods. The structure of production shifts toward shorter and less risky processes reducing longer and riskier ones. Hoarding, therefore, does not cause factors of production to be idle that shouldn’t be. Factors are just shifted toward gold production and shorter-term projects. Rallo insists that it is not irrational to hoard. Indeed, when long-term projects are maintained and economic conditions change, projects might have to be liquidated suddenly. For example, the earthquake would destroy the skyscraper in progress.

It should be noted that most Austrians do not hold a hybrid liquidity preference / time preference theory of interest. For Rallo the interest rate, or the structure of interest rates, is determined both by time preference and liquidity preference. Most Austrians defend the pure time preference theory of interest. My own position on this question can be found in this article co-authored with David Howden. Due to uncertainty an actor prefers to be liquid rather than illiquid. Due to time preference an actor prefers to be liquid rather sooner than later. Therefore, the yield curve tends to be upward sloping. When uncertainty increases, the yield curve tends to get steeper. In a financial crisis, however, another effect tends to prevail over this tendency. When society is in general illiquid, the high demand for short-term loans, the scramble for liquidity, tends to cause a downward sloping yield curve.

Idle resources are another important topic in Rallo's book since Keynes recommends inflation in the case of idle resources. Rallo asks why factors are unemployed and comes to the result that their owners demand a price for their services that is higher than their discounted marginal value product. In these circumstances, inflation implies a redistribution in favour of the owners of those factors, or a frustration of attempts to restructure, i.e., the economy suffers from forced saving or capital consumption.

In contrast, when factors of production adjust their prices, i.e., wages fall back to their discounted marginal value product, aggregate demand does not fall as Keynes suggests. On the contrary aggregate demand increases, because total production increases.

Rallo goes relentlessly after other Keynesian concepts. The famous “investment multiplier” requires idle resources of all factors of production. More precisely, for Keynes to be right you need voluntary unemployment of all factors of production plus idle capacity in consumer goods' industries. If there is no voluntary unemployment of all factors, government stimulation of new projects will lead to bottlenecks as factors are bid away from profitable investment projects. If all types of factors are idle, but there is no capacity in consumer goods industries, then government stimulus will raise prices of consumer goods and lead to a shortening of the structure of production. If, however, there is a general idleness of factors and idle capacities in consumer goods industries, why is there no voluntary agreement between owners of factors of production and entrepreneurs?

Another important Keynesian idea that Rallo tackles is the famous liquidity trap. A liquidity trap exists when, in a depressed economy, interest rates are very low. In such a situation Keynes regards monetary policy as useless, because speculators will just hoard newly produced money. Speculators will not invest in bonds because they are at maximum prices and will fall when interest rates finally rise. At this point monetary policy becomes impotent. Public spending becomes necessary to stimulate aggregate demand.

Rallo shows that after an artificial boom, in a situation where there are many malinvestments and a general over-indebtedness in the economy, there is indeed almost no demand for loans even at very low interest rates. We are actually faced with an illiquidity trap, as agents struggle to improve their liquidity. They want to reduce their debts and not take on more loans. The monetary policy of low interest rates actually worsens the situation, because with low interest rates, there is no incentive to prepay and cancel debts (because their present value is raised). The solution to this situation of general uncertainty is hoarding, stable institutions, the liquidation of malinvestment and the reduction of debts.

High uncertainty does not imply high unemployment, since even under high uncertainty the reduction of prices for services of factors of production renders profitable new projects. Under high uncertainty, these projects will be gold production (in a gold standard) and the short-term production of consumer goods.

As Rallo points out in contrast to Keynes, it is not aggregate supply or aggregate demand that is important, but their composition. If, in a depression with a distorted structure of production, in a liquidity trap situation, aggregate demand is boosted by government spending, the existing structure cannot produce the goods that consumers want most urgently. The solution is not more spending and more debts, but debt reduction and the liquidation of malinvestments to make new and sustainable investments feasible.

In contrast, for Keynes, the problem is always insufficient demand. So what can we do if consumers and investors do not buy the goods of that companies offer, but instead hoard? Well, Keynes recommends lowering taxes and interest rates, to devalue the currency, or that the government buys the products for consumers. But, why, asks Rallo, should consumers and investors buy goods they don't want?

Keynes’s answer is that otherwise unemployment will increase. Rallo responds astutely: But if a person is forced to buy with his salary something that he does not want, why shall this person work at all? The alternative to forced buying is to lower wages to their discounted marginal value product, which increases production and demand. As Rallo points out, society does not get richer if the government induces or forces people to buy goods they don't want. Thus, for Rallo the essence of Keynes’s General Theory is the following: when people do not want to buy what is produced, the government should force them to act against their will.

The insights from Rallo's book presented here are only a small selection. Rallo also offers an analysis of Keynes's main definitions and the theoretical errors behind them, such as their pro-consumption bias. He provides an Austrian analysis of financial markets, discussing the interrelations between the yield curve, interest rates, the discount rate, the structure of investment, the liquidity trap and the stock market. He analyses real and nominal wages, business cycles, political implications, and intellectual predecessors of Keynes's General Theory using Austrian theory. Also very useful is Rallo's guide for readers of The General Theory that makes reading and spotting Keynes’s main mistakes, chapter by chapter, easy and efficient. As a plus, at the end of the book, Rallo also provides a critique of the IS-LM model developed by John Hicks and Franco Modigliani which formalized Keynes's theory and is still taught at universities around the world.

Rallo's book on Keynes's General Theory is full of brilliant insights and provides the most powerful and complete case against Keynes currently available. The well-written Los Errores de la Vieja Economía will be the future reference for scholars and layman alike looking for errors in Keynes's thinking and today's policies. The main downside of the book is that it is written in Spanish. Hopefully, the work will be available in other languages soon.

Philipp Bagus is an associate professor at Universidad Rey Juan Carlos. He is an associate scholar of the Ludwig von Mises Institute and was awarded the 2011 O.P. Alford III Prize in Libertarian Scholarship. He is the author of The Tragedy of the Euro and coauthor of Deep Freeze: Iceland's Economic Collapse, both of which are available in English.
See his
website. Send him mail. See Philipp Bagus's article archives.
This review first appeared at the Mises Daily.

Thursday, 7 February 2013

DOWN TO THE DOCTOR'S: Peter Schiff Talks With Doug Casey

Libertarianz leader Dr Richard McGrath has been watching videos…

I don't normally submit two offerings in a week, but I just have to share this with readers. It's an interview conducted by Doug Casey with Euro Pacific Capital CEO Peter Schiff.

It will come as no surprise to hear Peter Schiff extolling the virtues of purchasing gold as a hedge against the collapsing U.S. dollar, warning of the coming inflationary consequences of the QE3 printing of money tokens, nominating Ben Bernancke as the worst ever Chairman of the U.S. Federal Reserve, and predicting the demise of living standards for Americans and others who suffer under high-tax deficit-funded big government.

But did you know that Peter's father Irwin Schiff is (as Peter puts it) a political prisoner? At age 84, Schiff Sr. is serving a 13 year prison sentence for refusing to pay federal income tax and for contempt of court.

Watch and listen to Peter's version of how the various trials were conducted and why he believes his father is the victim of a miscarriage of justice.   

See ya next week
Doc McGrath

Indonesia is … not well.

Sent through by our roving Asian correspondent Suzuki Samurai is this piece on Indonesia that appeared in The Diplomat:

Indonesia has made a remarkable comeback from being Southeast Asia’s economic basket case in 1998 to an emerging market whose economy has been growing annually at more than 5 percent for several years.


Yet, Indonesia’s economic growth is neither sustainable nor inclusive.


An inconvenient fact is that Indonesia’s economic growth is mainly driven by a commodity boom fuelled by China’s appetite for raw materials and global demand for biofuels [which bubble is soon to burst] …
    The other main driver of Indonesia’s economic growth is domestic consumption. This is mostly driven by easy access to credit cards.

Sounds a little too much like a rather large island just the other side of the Tasman, doesn’t it.


Yet again another Novopay pay round has been labelled a shocker, as “the Ministry of Education fielded hundreds of calls from school staff either not paid or underpaid by Novopay yesterday.”

As you might have noticed, a ministerial inquiry is about to be established to inquire why the centrally-planned, centrally-governed, one-size-fits-all system failed. 

Perhaps the first question to be asked is ‘why is such a system is even necessary?’

Schools have their own pay administrators, who currently spend around half their time making up calculating pay and the other half trying to remedy stuff-ups by Novopay. Why on earth not have them simply pay the staff from the school’s bank account, without any need at all for a centrally-planned, centrally-governed, one-size-fits-all payroll system?

Why not?

Because perhaps the second point to contemplate is that the problem with Novopay is not specifically a software problem at all.  I suggest instead it’s exactly what you’re expect of a centrally-planned, centrally-governed, one-size-fits-all system.

Which, when you think about it, is exactly what you have with the government’s centrally-planned, centrally-governed, one-size-fits-all mis-education system.

It’s just that  the failures with Novopay are far more obvious than the failures of the mis-education system itself.

Mainzeal is a symptom of a larger problem

When a large builder like Mainzeal falls over it causes a bigger splash than all the other smaller builders that have quietly retired, gone under, or moved their assets to Queensland—but the causes of their collapse is the same.

Questioners have been asking this morning how it could  happen just when rebuilding in Christchurch is just about to start?  How it could happen when Auckland has a serious housing affordability problem, and a  severe shortage of starter homes.

Let me venture a guess.

This is partly due to some poor management, as Brian Gaynor and others have hinted at, but it’s also a symptom of the facts contained in both questions.

How could it happen just when rebuilding in Christchurch is just about to start? Because, for two years, rebuilding in Christchurch has not been allowed to start—by order of the government. Another great example of the failure of central planning preferred by this government.

And how could it happen when Auckland has a serious housing affordability problem, and a severe shortage of starter homes? Simple. It’s happened because there is a serious shortage of starter homes being allowed to start—a great example of the collapse of the model for speculative housing* about which this government has done nothing but talk.

In other words, Mainzeal’s collapse illustrates the problems facing every builder in the country.

Add to that the fact that Mainzeal, like almost every other builder in the country, has taken the rap for leaky home problems caused by others, and it’s frankly no wonder at all that it’s gone down.

It’s caused a bigger splash, but every builder, developer and property investor faces the same problem.

I suggest you direct your anger at the appropriate suspects.

* What is speculative house building? It’s when Joe Builder buys a site, builds a house on it, and sells it to Mr and Mrs New-Home-Owner for more than he’s shelled out—giving him a small profit which he can use to build his next one. This is how “spec” houses have been built since Adam was a lad. Now however the cost to build a house outstrips even the cost people are prepared to pay for it. Meaning the model for spec building—the engine of affordable housing—is broken. And things won’t be fixed affordably until this model is repaired: As a simple measure of when affordable housing will be built again, it will be when the model for speculative house building returns.

Tuesday, 5 February 2013

SUMMER SNIPPETS: ‘Parallel Motion: A Biography of Nevil Shute’

Snippets from my summer reading of Parallel Motion, a new biography of novelist Nevil Shute, author of A Town Like Alice, Trustee from the Toolroom, No Highway and many more novels showing the best of the human spirit.

Shute summed up the carefree days of peace before the First Wold War with the poem Romance by Eleanor Geach… [but for the schoolboy] Shute, as for millions of others, the attitude to the War [and to life] changed as the casualties increased…  His thoughts were no longer of a career on leaving school.  As he later wrote, he was ‘born to one end’: to go into the army and do his best before he too was killed…  The school casualties mounted almost daily with the names of older boys, whom he had known, being read out in Chapel, and realising that younger boys might one day be kneeling in remembrance of him.”

For Shute, as for the country as whole, the war had been a costly and devastating experience.  His beloved brother and many of his friends from school had been killed.  Indeed, some 320 [schoolmates] were killed during the First World War.  Shute had mentally prepared himself for the same fate but he had been spared; he was one of the reprieved.  He had a future and began to realise there was such a thing to be got out of life as fun.”

In early 1936, his aircraft design and manufacturing company Airspeed designed their new Envoy plane around the new modern Wolseley radial engine.
“So it came as a real blow when [Wolseley’s] Lord Nuffield announced in 1936 that they would cease making the engine, which had been developed at a cost of £200,000.  Nuffield’s decision arose from the system adopted by the Air Ministry.  The ordering procedure used I.T.P (Instruction to Proceed) contract terms.  This [heavily bureaucratic[ system specified a maximum fixed price which could, after investigation, be less.  Lord Nuffield got the I.T.P. contract documents for the Wolseley radial engine and realised the implications.  The terms would have required re-orientation of their offices with an army of accountants to keep track of production costs… So the aero engine project was abandoned, much to Shute’s dismay.  He regarded it as a major disaster for Airspeed, and decided that he must make an effort to see if Nuffield could be persuade to change his mind… Lord Nuffield received him courteously.  This was the same William Morris whom Shute, as a schoolboy, had watched building his cars in Longwall St, Oxford.  Recently ennobled, he was the head of a large manufacturing business that included Wolseley.  He listened carefully to what Shute had in mind and was sympathetic, but reminded Shute that he had the Air Ministry to thank for his decision to stop manufacture of the aero engines.  He was angry with the Ministry and told Shute he had ‘sent that I.T.P. thing back to them and told them they could put it where the monkey puts his nuts.’
… The Wolseley episode left a sour taste in Shute’s mouth… To his mind civil servants, with their restrictive practices and small-minded attitude, had deprived the country [at at time of impending war] of an excellent aero engine.”

1949 saw Shute piloting a tw0-seater Percival Proctor nicknamed ‘Item Willie” on the then difficult journey from London to Australia, stopping only for fuel and servicing along the way.
“[From the airfield] they took the bus into Athens so they could visit the Acropolis.  [His passenger] thought the Parthenon was one of the most beautiful buildings he had ever seen.  Shute said he preferred the Rockefeller Plaza, holding that it was a complete work of art, whereas the Parthenon was handicapped by being a ruin.”

61 days after leaving England, they cleared customs in Darwin.  After enjoying Australia climate, hospitality and friendliness  for a month he landed in Sydney, at Bankstown .  
“There he ran into trouble, not a good introduction to Sydney.  He was told he should have flown to Mascot.  He phoned the controller and said that Bankstown was his destination, that he had made forty landings in Australia and Bankstown was the forty-first: He would take the documents to the Custom House or they could come and get them, whichever they preferred.  He then rang off and went to lunch.
    “On his return, there was a message saying that unless he flew to Mascot immediately, police action would be taken… Customs [there] insisted on opening all his luggage and searching it—God knew what for, since he had been in Australia for a month… There he arranged with de Havilland for a programme of work to be carried out on Item Willie he thought would take rather more than a week… He would therefore have to stay in this unpleasant place for 10 days or so.  He wished to God he had never come south in this country, but passports, visas and aircraft permits to fly home could not be secured except in Sydney or Melbourne.  Sydney seemed to him to be an ugly, cheap city full of drunks.”

His impressions of Melbourne were vastly different, and he was to settle there the next year, just after the publication of A Town Like Alice.
“In mid-June 1950 Shute wrote to [long-time friend and adventurer Sir Alan] Cobham … saying he was packing up in England and going to live in Australia…  His decision to leave England was prompted by several factors, not least of which was a major public row over his petrol ration.  In Britain in 1950 petrol rationing was still strictly enforced [by the Attlee Labour Government], five years after the end of the War.  [Shute engaged in lengthy but essentially futile correspondence with “The Ministry” proposing an alteration in his “allocation” so he might travel for research, saying after sending one letter] he would watch for their reaction to his proposal with interest since the ability of the Government to conduct itself with good sense in such matters would seriously affect the decision he took whether to stay in England or go… Nearly a fortnight went by without a reply from the Ministry, which caused Shute to send a letter rebuking them for the delay which in business circles would be “regarded as an act of studied insolence.” … By the time he won [his third victory in eighteen months] he had made up his mind to leave England…  The row over petrol rationing, like the demise of the airship programme [which had been another lesson in militant bureaucracy], marked a turning point in Shute’s life…
    “Bureaucracy, always Shute’s bête noir, had raised its obstructionist head and inflamed his anger, vented in his letters to the Ministry…  He did not leave for the United States, as he told the Ministry, but Australia… He had been impressed with Australia during his visit there, more so with Melbourne than Sydney.  In his letter to the Society [of Authors] he said he reckoned he could get three good books out of  there which would probably take him five years to research and write, and five years was as far as anybody could see in those times.”

When Shute arrived in Melbourne there was quite a crowd of reporters at the foot of the gangway waiting to question him.  They wanted to know if it were true that he had ducked out of England to avoid high taxes.  Shute replied that the taxes in England were unpleasant and so was the current government’s experiment in socialism.  He added that he had also decided to come to Australia because everything about the country fascinated him—even the climate.”

“[In his autobiography, Slide Rule, Shute] dealt at length with the [1920s] airship programme and the rivalry between the [private] R.100 and [the government] R.101, and placed the blame for the R.101 disaster squarely on the civil servants and [Air Minister] Lord Thomson in particular.  Reflecting his experiences at that time and also probably his treatment at the hands of the Ministry of Fuel and Power, he wrote that ‘a civil servant or politician is still to me an arrogant fool until he is proved otherwise.’ …  Shute felt that a study of the accident could ‘provide data to rectify many of the ills that plague our democracy today.’” 

On the Beach was to feature a motor race towards the end and, early in 1956, Shute ordered a Jaguar XK140 sports car.  This was so that, he claimed, he could obtain first-hand experience of racing a high performance car… As he wrote in Slide Rule, ‘it is very good for the character to engage in sports which put your life in danger from time to time.  It breeds a saneness in dealing with day-to-day trivialities which cannot be got in any other way, and a habit of quick decisions.”

From his earliest days in Australia, Shute had taken an interest in the fortunes of young Australian writers…  He was on friendly terms with Robert Menzies, the Prime Minister, and also with Richard (Dick) Casey, then Minister of External Affairs… and sent off for publication … a memorandum he wrote to Menzies.  The purpose of the memorandum was to set out his thoughts, not only on creative writers, but also on artists and composers in Australia…
    “It was the purpose of the memorandum to show how Australian prowess in in the creative arts of peace might be nurtured and displayed to the world…
    “At the outset he said he did not believe it was wise to assist writers with any form of subsidy so they could write a book.  He reiterated what he said before—that is was best for the young man or woman who wanted to write to take a job in a commercial occupation and write in the evenings until the writing became more profitable.  That way the writer would get to know the characters of men and women during his or her formative years.  They were the raw material of stories…
    “A certain degree of success was of course necessary or the young writer would stop writing,  But too much encouragement from literary authorities, without corresponding support from the public, might induce in the writer an illusion that he was a superior person to the common man and a belief that, if they public would not read the pearls of wisdom he laid before them, they should be made to do so in their own interest.
    “Shute wrote [however] that subsidies from the [Commonwealth Literary] Fund should continue.  Such magazines gave useful encouragement to writers.”

In conclusion, Shute wrote that a person who was gifted with creative powers could usually exercise those powers in many fields of the world’s creative activities.  In his early years, his work on new aircraft designs was very satisfying to the creative side of his character and those years were followed by creating a new aircraft company and working it up from zero until it employed a thousand men in time of peace.  He went on to say that, compared to creative work of that magnitude, the writing of fiction stories seemed to him at the time to be ‘a pansy occupation’ and still did.  If the aircraft industry had continued as it was when he was a young man, when aircraft could fly within six months of first conception, then he might still be an engineer.”

Why does Waitangi Day belong to one race?

Why does Waitangi Day belong to one race?

It could be an annual non-racial nation-wide celebration of everything we’ve achieved in this country, which in just over one-hundred and seventy years our we and our forebears have turned into one of the best little countries in the world. It should be a celebration of the bringing to these isles of British rights and the British rule of law, which in 1840 still meant something—and which have underpinned ever since our freedom and prosperity.

If any country has something to celebrate, it’s this one. Wet instead, tomorrow will be another annual diplay of attention-seeking race-based bitching.

Bitching, this year, about “current constitutional arrangements” (there is “no constitutional safety for Maori” says a Margaret Mutu eager for a future of permanent hand-outs under a Maori-Party negotiated constitutional coup d'état).

Bitching this year, as every recent year, for all beaches to be given in perpetuity into the hands of tribal chieftains.

Bitching this year, as every year, for more handouts, more special favours for those of a particular hue, more legal standing for all those well-paid, well-upholstered tribal chieftains sitting at the trough around the BrownTable.

Bitching, this morning, about which particular misbegotten crone will get to hold John Key’s hand as he walks onto the marae.

Why do we countenance it?

And why do we let the whole agenda for celebrating the birth of our country belong to one race?

Time for something different. Time for a proper national day, and to turn this one instead into a One Law For All Day.

Which would, in itself, be much to celebrate.

DOWN TO THE DOCTOR’S: Salinger: Distinguished Ambassador For The Panic Merchants

Libertarianz leader Dr Richard McGrath has been waiting for a break in the weather of climate misinformation.

Climate alarmist and sacked former NIWA employee Michael James Salinger has really outdone himself this time. On January 30, when the focus of much of the nation was on searing (for New Zealand, anyway) summertime temperatures and drought, Salinger opined from his ivory tower that temperatures could reach the high thirties and possibly the low forties.

If New Zealand was ever going to break its record temperature, it would be now, Dr Salinger said.

“Parts of the South Island could expect temperatures over 40,” said the Oracle.

Notice that this stranger to truth* carefully said nothing about global warming. Nothing that controversial, not openly. This was posed as just a simple prediction of temperature in a specific region of the country, a day or two out from the time period under consideration. From a visiting and consulting professor at Stanford University, no less. Whose predictions carry weight. A certainty, surely.

Living on the east coast of the North Island, in one of its hotter towns, my curiosity was stimulated. And worried.  I had fears of Masterton wilting under some seriously scorching temperatures.

So what happened?

Almost immediately, the local weather predictors rubbished Salinger's calculations. MetServices Ian Gall said he doubted whether temperatures would ever reach 35C, noting that a north-westerly wind would be required for this to happen. And WeatherWatch's Philip Duncan said simply:

I don't think it's going to happen.

He was right. The following day, Masterton's official temperature reached 32.2, the nation's maximum, but at least eight degrees cooler than Salinger's doomsday prediction. Eight degrees! Yet Jim and his fellow travellers want us to ditch our gas-guzzling forest-killing ice-cap-melting automobiles and instead ride bicycles made out of plywood because of a predicted one- or two-degree increase in global temperature over the next century! Can anyone else see the irony in this?

As I write this, Masterton is enjoying a thunderstorm and heavy rain that was too much for some of the guttering around my home, with rainwater spilling over the side despite my having cleared them of leaves a week or two ago. Sorry to have to tell you this Jim, but the heatwave is over. The temperature here is dropping to 23 degrees tomorrow and 20 the day after, and it's going to keep raining. Oh dear. So much for Jim - he can't even manage a simple weather forecast for two days ahead. Why on earth should we believe his predictions for the next century?

Furthermore, Jim doesn't even have the courage of his convictions. He wouldn't voluntarily pay a levy on his own use of carbon unless a gun was held to his head. To quote the man:

A "voluntary emissions scheme" is like asking me to pay voluntary taxes - I would probably not pay them!

And what would stop you paying of your own accord this tax you so desperately want the rest of us to pay, Jim? I know the answer: it's not the mitigation of CO2 emissions that concerns you, it's making sure that everyone (especially the rich) is sucked into paying this stealth tax. Well, something has to fund all that wealth redistribution doesn't it?

Can you imagine how many carbon credits Ayn Rand's industrialist hero Hank Rearden would need to find to keep the likes of Jim happy:

“He saw his mills rising in the darkness, as a black silhouette against a breathing glow.  The glow was the color of burning gold, and ‘Rearden Steel’ stood written across the sky in the cool, white fire of crystal.  He looked at the long silhouette, the curves of blast furnaces standing like triumphal arches, the smokestacks rising like a solemn colonnade along an avenue of honor in an imperial city, the bridges hanging like garlands, the cranes saluting like lances, the smoke waving slowly like flags.  The sight broke the stillness within him and he smiled in greeting  It was a smile of happiness, of love, of dedication.”

See ya next week!

Richard McGrath
Leader, Libertarianz Party

* Editor’s Note: You’d think Soapbox Salinger might have been more careful, having been sacked after talking in the Herald on Auckland’s so called “hottest day ever” back in 2009 -- “the highest since official NIWA records began in September 1868” said the Scare Merchant – a remarkable judgement based on one outlying reading in Whenuapai, a station which only existed from 1945 to 1993 and from 2005 to now.

Here’s Martha & the Vandellas: