But Now You Know

The search for truth in human action

How Student Loans Increase Your Tuition


People are complaining, as they should, about how tuition prices are shooting up far faster than inflation…in fact, how they went up even faster while the economic depression had prices stagnant or falling, nationally.

The commodity subsidized the most, is the one that's gone up the most in price. In fact, each of these is inflated in accordance to its subsidization, although energy's short-term volatility is a result of our self-destructive foreign policy.

It seems that the more the government increases grants and student loans, and gives special breaks to students or parents to help them pay for college, the more those prices shoot up and undo that benefit.

But this is not a coincidence. It’s exactly what must happen, because of those student benefits…and the more the government hands out student aid, the more the laws of Supply and Demand and of Unintended Consequences will force tuitions higher:

Subsidies

When you give away money to help people buy something in an industry, it’s technically called a “Subsidy“…and the primary function of a subsidy is to raise prices. The government, unfortunately, often does just that, on purpose, giving a subsidy in an industry because it’s been bribed by lobbyists to place the profits of the producers over the needs of the members of society (aka consumers). Farm subsidies are how it keeps milk and other staples too expensive for poor people to buy without the government’s own “help”, for example.

The way a subsidy works, of course, is that you increase the number of dollars available to buy the product, while the actual demand for that product, and therefore its supply, stays more or less the same. If people generally choose to spend a one hundred million dollars per year on apples, and they average $1 a pound, then the government offers people an extra fifty million dollars to “help” them buy apples, the average price of apples can increase to $1.50 a pound, driving up prices of pies, and giving poor people one less healthy snack they can afford. That’s a bit oversimplified, but pretty much how subsidies are used.

Sugar cane field

Sugar cane is cheaper, and better for the environment than beet sugar, but punished by a beet subsidy

People didn’t actually want beet sugar more than cane sugar, the government simply threw more money at it, so that there was more to spend, and prices rose to a new level.  Why? Bribes from beet farmers.

Of course the poor benefit from the inexpensive calories of sugar, so this hike in prices caused them to go hungrier…but they don’t have lobbyists as powerful as the more corrupt and irresponsible farm organizations do.

But money poured into an industry to pay for its goods is a subsidy, with the price-boosting impact, no matter whether that’s the official intention or not:

Health Care Prices

For example, Bush’s own socialized medicine plan, Medicare Part D, threw hundreds of billions of dollars at pharmaceutical companies, for the same medicine that was already out there. Naturally, prices went up even higher, helping precipitate the “crisis” that was used to pass Obamacare…and the Obama administration now admits that, indeed, the added money from Obamacare has caused health care prices to shoot up even faster, even in the short time since it was enacted…and contrary to the claim that it had to be rushed through to reduce prices.

In fact, if you track health care prices through the past century, they shoot up each time the government imposes a program to “help” pay. The largest increase was immediately after Medicare was implemented.

College Tuitions

Occupy Wall Street protester, complaining about student loan debt

The Occupy Wall Street movement is correct to complain about the massive debt created by student loans...because those loans have increased tuitions, tenfold.

Therefore, it’s really no surprise that college tuitions go up each time government grants and loans increase, even when the economy is weak and driving many other prices down.

In fact, with the government’s fake “student loans” and grants now making up the majority of all money spent on tuition, it would be impossible for tuition prices to do anything but be inflated by many times what they would be if colleges had to actually compete for student money, directly.

People are, right now, complaining loudly about how tuitions are going through the roof…but Big Brotherment’s response has simply been to throw even more money at tuitions, like Obama’s recent, unconstitutional Executive Order, even though this will just increase tuitions more.

It’s as if your doctor’s proposed response to emphysema was for you to chain smoke, because the nicotine will make you feel good.

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November 11, 2011 Posted by | Economy, Education, Politics | , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | 5 Comments

Are the Muslim Brotherhood Actually Bad for Egypt?


Muslim Brotherhood kicks puppies and eats babies, but they don't have a man-sized safe in their office

Neocons and other violent interventionists keep talking about how bad it would be if the Egyptian people were to gain their freedom, because there is popular support for the Muslim Brotherhood, and if they were part of the government that would, obviously, be a really bad thing…even worse than a dictator like Mubarak who outlaws many religious beliefs and slaughters people for their political ideology.

But wait…it’s not “obvious” that this organization, the Society of Muslim Brothers, is any worse than the Christian Coalition in the US. And America doesn’t deserve a dictator just to keep the Christian Coalition out of political power. What’s more, it seems the Muslim Brotherhood is usually more akin to the Salvation Army, except they’re Muslim instead of Christian. Let’s look deeper, and see which interpretation is true.

Who Are They?

What is this group, so ominously touted by the neocon supporters of Hosni Mubarak?

Just like the Christian Coalition, it is a voluntary social and political movement, organized around the idea that followers of their religion should choose to live by the tenets of that religion.

People who think that a religion’s members should live by their beliefs? If anything, that seems like a truism, to me. A “well, no duh” sort of thing.

Also like the Christian Coalition, some of its members, sometimes, want laws passed that happen to support their morality. I don’t like that in either case, but I will fight against anyone who wants to imposing a dictator over people who would vote for such laws. Hopefully, you will too, since the Christian Coalition voters are American.

And let’s be real, it’s not always bad if religious beliefs become law: the Ten Commandments that both Muslims and Christians accept include prohibition of murder and theft. Do I want murder legal because a religion wants them banned?

Of course not.

Everyone Agrees

Before we get into the claims against the Muslim Brotherhood, let’s mention the part that is not denied by anyone:

What everyone agrees about, regarding the Muslim Brotherhood, is that they mostly do community service, charitable efforts, and other good works. I think even the worst neocon would admit this, if you pinned him down on the subject. There are probably hundreds of thousands of people, of diverse cultures and races, who are alive right now solely because of the efforts of the Muslim Brotherhood. Again, this is not even disputed.

But what about their Dark Side?

Al Qaeda and the Taliban are charitable, but they still seem evil overall. If the Muslim Brotherhood is like that, I’ll oppose them.

The "Be Prepared" Emblem of Death, replete with the infamous Green Stars of Evil

The Accusations

Many Conservatives and Liberals in the media seem perplexed by the claim that Egypt should remain a dictatorship, but whenever they have a neocon on, or that Israeli ambassador,  or some “former CIA officer”, they’re told that it’s because of the Muslim Brotherhood, who is accused of three general things:

Be Prepared

Glenn Beck was shouting, the other day, about how the Muslim Brotherhood’s motto on their website is “Be Prepared”.

Well, yes, I’m not sure you could be more obviously, patently evil than to have the motto Be Prepared. To the right, you can see a variation of this logo. It is for another religious organization, that requires its members to take an oath of obedience to their god much like the Muslim Brotherhood does. Worse, the bearers of that symbol are, unlike the Society of Muslim Brothers, actually members of an openly paramilitary organization.

Surely such symbols should be banned, along with target and sniper scope graphics.

Of course the Boy Scouts will probably object.

To be fair, the thing the Society of Muslim Brothers emphasize that Egyptians to be prepared for, right now, is war with Israel.

Beck seemed to infer that this means they’re planning to attack Israel…which makes me worry about his reading comprehension, because the quotes he read off their own website to “prove” this clearly were saying that the government of Israel might attack Egypt for overthrowing the dictator they’d helped keep in power for 30 years. What they say is that the Mubarak government can be brought down by cutting off the gas pipeline to Israel, which will bankrupt Mubarak’s dictatorship…but that this will cause war with Israel. In other words, Israel will attack, because they want the gas and, the Muslim Brotherhood believes, will even cause the death and destruction of war to get it.

I don’t blame any of Israel’s neighbors for fearing that it will go to war with them. It’s done so before. The people of Israel, themselves, fear this of their own government. The recent threat had been an unprovoked attack against Iran, but now Egypt is the popular target. I join with the people of Israel and the Society of Muslim Brothers in opposing any violent aggression on the part of Israel against any other country.

To be fair, I and most Israelis, Jews, Egyptians, Muslims, Coptic Christians, Protestants, Catholics, atheists, and every other non-sociopath, oppose all initiation of aggression, by any country or person against any other. We’re opposed by the neocons and other self-described Marxists, but that’s another debate.

While we’re at it, Beck keeps mentioning Islamic Socialism, a bizarre fringe movement that goes against the basic belief of Islamic fundamentalism that socialism is evil. As it happens, the Muslim Brotherhood is on the “socialism is evil” side. They believe in voluntary charity, not coercive socialist government like Mubarak and Saddam Hussein imposed.

Sinead O'Conner crazily associating all Catholics with the IRA terrorists

They’re Muslims

Then there’s the claim that the Muslim Brotherhood is evil because its members believe in…well…Islam. If you’re one of the poor rubes who’s fallen for the “Islam is a religion of evil” scam, I don’t think there’s much that will convince you otherwise.

The Koran saying something like “kill any unbeliever who supports tyranny over innocents or Muslims” gets quoted out of context as “kill any unbeliever”, but that contextual lie has been pointed out plenty of times by now, you should have been capable of learning, and responsible enough to do so.

The few craziest, most old-fashioned Muslim rules are no worse than the crazier Jewish or Christian rules. Should we all sacrifice doves when our babies are born? Stone women who have sex out of wedlock? Burn witches? Those aren’t just Islamic rules, they’re old Christian and Jewish rules, too. And the vast majority of  followers of all three religions have outgrown such nonsense.

Likewise, like how everyone who’s murdered an abortion doctor is Christian, but it does not mean Christianity is murderous, so it is with Muslims who kill people in the name of their religion. The Catholic terrorists murdering random Protestants because of their religion in Ireland don’t prove anything about their religion, and neither do Islamic terrorists.

But, even more fundamentally than this, it’s hypocritical for anyone to claim that Muslims shouldn’t be allowed to govern themselves because of their religion, when so many in the socialist world hate Christianity the same way, and think that Americans, who are majority Christian, are similarly unable to govern themselves. Should we have tyranny imposed on us, to keep Christian mores from becoming law? Again I say “no”, and I’m not hypocritical enough to turn around and deny another country or religion the same right.

It’s also worth noting that the Muslim Brotherhood is Sunni, while the Islamic Revolution in Iran is Shi’ite. That’s important because these two groups are oppose each other completely. It’s not like Protestant vs Catholic…they literally see each other as Satanists. There’s never going to be any real collaboration between the Muslim Brotherhood and the current Iranian government. They’re more likely to help overthrow the Iranian tyranny, too.

And they’re also the most spiritual, historically least violent form of Sunni Islam, they are Sufi. To quote a previous article here:

Pretty much all of the terrorist organizations in the world that are focused on the United States are Wahhabi, funded and trained by our allies in Saudi Arabia, and often closely coordinated with our allies in the Pakistani military.

Wahhabism is a crackpot fundamentalist version of Sunni Islam. Think of Sunni as being like Protestantism, a relatively liberal branch of the religion overall, and Wahhabism as being like the Protestants who dance with snakes and talk in tongues.

Meanwhile, most of the rest of the terrorist organizations in the world that are Islamic at all are Shi’ite. This is the second of the three branches of Islam, and the most basic one, with an older lineage than Sunni Islam. Think of that as being somewhat like Catholicism…most Shi’ites are peaceful, but you have the crazies, like the Irish Republican Army is for Catholicism. You can’t really blame the rest for those nutjobs in the IRA targeting other peoples and religions.

And then you have the Sufi. These are a bit like the Mormons are to Christianity. They’re a “third way” sort of group, very peaceful and focused a lot on mysticism and spirituality, not the practical mechanics of the Big Two. No terrorist organizations, in the whole world, are Sufi. Some Muslims say they’re so different that the Sufi aren’t even Muslims, at all.

In fact, the Muslim Brotherhood are in a struggle against the violent, hateful Wahhabi movement, as well as considering themselves the polar opposite of Shia. In fact, the “Jihadi” movement of Al Qaeda and their ilk are excluded from the Egyptian uprising, perhaps because the Muslim Brotherhood are a part of it.

They’re Out to Get You!!!

So that just leaves crazy conspiracy theories: The Muslim Brotherhood secretly wants to bring about apocalypse, supports assassination of people they think are evil, et cetera.

I’ve seen more credible evidence of the fundamentalist Christians supporting those exact same things. In fact, I have personally known wealthy, powerful Christians in the US who are part of the Christian Eschatologist movement, and literally believe that they should try to bring about Armageddon, to hurry Jesus’ return, by supporting evil, oppressive government.

But in both Christian and Muslim cases, I assume that there are fringe elements who are like that, but that I can’t assume the whole group does, since it disavows them adamantly.

The 15 Principles of Egyptian and American Founding Fathers

In fact, the Muslim Brotherhood is so against those things that it has “15 Principles of Agreement” that it wants to institute in Egypt, that you would support, too.

The only disagreement the Founding Fathers of America would have with the Muslim Brotherhood’s 15 Principles is that Thomas Jefferson and friends opposed a standing army and standing police force. Is anyone seriously going to blame the Muslim Brotherhood for implicitly endorsing those two forces, but requiring them to stay out of politics?

The 15 principles could have been written by the Founding Fathers...but they might have pared it down to 10

Here are the 15 principles the Muslim Brotherhood says it wants for Egypt, each one summed up:

  1. Nobody may govern except at the consent of the people
  2. Free and fair elections
  3. Freedom of personal and religious conviction
  4. Freedom of establishing religious rites.
  5. Freedom of expression and the press
  6. The right to form and exercise political parties
  7. The freedom of assembly, as long as there’s no violence
  8. The right to hold peaceful demonstrations
  9. The right to a regularly elected, representative government
  10. The right of every man and woman to vote
  11. The right of every citizen to run for election and hold office
  12. The right to a truly independent judiciary, no special courts except for legitimate internal military affairs
  13. Prosecutors, public defenders, and criminal investigators must be three independent groups, from each other and the Minister of Justice, and anyone accused should have the right to appeal.
  14. The military must stay out of politics, only defending the nation’s external security.
  15. The police must only protect society, and is banned from interfering in politics or with political opposition

Please take a moment to read the full text of the 15 Principles of Agreement of the Muslim Brotherhood.

I wish our own government seemed to believe in these 15 principles.

Let’s make every elected or appointed official in the United States include them in his oath of office. And every government bureaucrat, while we’re at it.

If even a large segment of the Muslim Brotherhood believe at least somewhat in the 15 Principles of Agreement, then they’re probably no worse than our own government. And I see no evidence that they’re any worse. Individuals in that movement, yes…same as every other movement. But not the overall social organization.

Should we, in America, continue our government’s habit of supporting dictators in our name, like Mubarak, just in case the Muslim Brotherhood might be popular there?

Not even if they’d turned out to be “bad”.

It was ironic that I saw the former Israeli ambassador to the UN, the other day, quote Mubarak as paraphrasing Douglas Casey, that American foreign aid is “a transfer from poor people in rich countries to rich people in poor countries“. He seems to have been mockingly referring to his own receipt of sixty billion dollars, from US taxpayers, over the past few decades.

This needs to stop.

February 6, 2011 Posted by | International, Philosophy, Politics, Religion | , , , , , , , , , , , , , , , , , , , , , , | 17 Comments

Why Stimulus Spending Depresses the Economy


There is a good reason why Bush’s “economic stimulus” plans helped land us in economic depression, and why Obama following that precedent with bigger, badder stimulus plans will do even more harm.

It is the same reason why Japan’s “stimulus plans”, upon which ours were partially based, kept them in an economic depression for a decade, and did the same thing in Sweden.

Here’s How

  • Lost Money: Every penny spent is taken from the private sector: whether through taxes; or by borrowing that robs from private investment, so nothing is gained. Then that money is wasted before it’s spent, because of the cost of bureaucracy, red tape, political motivation, and the lack of any control over the benefit of what it’s spent on.
  • Crowding Out: The government spending competes with private spending, but has no checks or balances, no responsibility, so that it can crush the private competition out of the market, causing more economic harm instead of helping. It hires away workers and managers with large budgets, yet contributes less. It draws away research and investment from the private sector, et cetera.
  • Chilling Effect: Healthy private investment and behavior is seen as punished, as unconditional public spending displaces it. Government spending tends to reward failure, and not to create wealth, while private spending depends upon productivity and success to expand. Bad companies, which do not contribute enough to society to justify their existence, have their ineffective ways perpetuated, instead of being excised and replaced with new competition.

Lost Money

Your Neighbors

1194819_old_windowYour neighbors are planning to upgrade all of their crappy single-pane, wooden windows to nice thermal-pane replacement windows.

(Don’t ask how I know, just work with me, here…)

Your neighbors, therefore, shall cause the full employment of a team of six carpenters/installers, for one week. And those workers will, in turn, use their pay in ways that end up rewarding others, by spending or investing.

Of course they’ll also be profiting the company that sells windows, which in turn will reward its suppliers by ordering more, et cetera.

Your neighbors will, too, have nicer windows. Their house will be more comfortable. They will save money on their energy bills. And, if they are Global Warming True Believers, they will also feel very good about their effort to save the earth.

All of this benefits society and the economy. Even the feel-good parts.

Big Brother

But perhaps your neighbors will be prevented from doing this, by Big Brotherment.

Maybe their taxes are, or will be, high enough that they won’t be able to afford to buy those thermal replacement windows.

Perhaps, in fact, the amount necessary to upgrade their house will, in fact, be spent on a Stimulus Package, funded by their taxes.

That tax money, instead of being spent on their house, will instead filter through the government bureaucracy. The majority of it will actually be paid to bureaucrats, who produce nothing but paperwork and rules.

What’s left, in theory, will go to some union contractors in Iowa, to finance a Corn Museum. Never mind that Corn makes more money for its producers than any other crop, the government is financing this to “stimulate” the economy.

So a team of three union carpenters will get paid for about five days, based on your neighbor’s tax money. Three, because a majority of the money was lost to red tape, and only five days, because the union monopoly dominating the government contract in question is overpaid.

Better still, once their hourly coffee breaks and four mandatory half-hour breaks are deducted, and you take into consideration the bizarre “safety” rules in their contract, that leave them standing around more often than working, what you will actually get is about the amount of work one carpenter’s could do in five days.

And it will be dedicated to building the 23rd corn museum in the United States.

So the options are:

Free Market

  • Your neighbors get a house full of thermal windows.
  • Six carpenters get fully employed for a week.
  • A window company is rewarded for improving the lives of your neighbors.
  • Money is saved on energy.
  • The planet is no longer doomed.

Government Stimulus

  • Iowa gets 0.01% of a corn museum.
  • Three carpenters get employed for five days, to do the work of one carpenter.
  • People may, if the project is ever finished using other people’s tax money, get to save an hour over driving to the privately funded corn museum next door in Illinois.

Now a government bureaucrat will, in defense of his precious Pork budget, say “but we can’t be sure your neighbor will buy thermal replacement windows!”

But, quite frankly, we can be just about 100% certain that they will spend it on something they value. I’m not entirely clear on how even pet rocks and full body massages would be any less of a contribution to the economy than another corn museum.

And, seriously, much of the government’s spending benefits society less than corn museums, too.

Bridges to nowhere, two thousand dollar toilet seats, military equipment the generals said they didn’t want, but some senator insisted on funding because it is built in his state, methadone for junkies that is more addictive and toxic than the heroin it is replacing, free benefits for illegal aliens…

Face it, the corn museum was actually an optimistic example of government benefiting society.

Ultimately, each dollar the government spends must come from a dollar ALREADY taken from your pocket, directly or indirectly. There is no stimulation, because it’s just the same dollar. And, worse, YOU would have bought something you felt was beneficial, not wasted it on some bureaucratic make-work project.

Crowding Out

(caption: Buying stuff on closeout from a bankrupt company helps the economy far more than a government check)

(caption: Buying stuff on closeout from a bankrupt company helps the economy far more than a government check, regardless of whether it saves the bankrupt company)

And let’s not forget that the government’s spending competes with private spending. There is a pressure against private industry, when it’s forced to compete with a government that can forcibly finance a project without any standards for success.

Workers

As noted above, if you are a carpenter, you can get a job where you are paid for what you accomplish, in the private sector, or you can get a job in a government contract where a union monopoly guarantees you more pay, for less work, a coffee break every single hour, and you’re not actually expected to even succeed, or do good work.

With government spending, therefore, one ends up with fewer skilled workers in the private sector.

Research

Better an easy government research job with no results required except regular publication of results, than private sector research, that must actually prove some contribution to society.

This is why things like cancer research and alternative energy research have produced only insanely expensive, ineffective results.

Business

Why build a privately financed corn museum, when there is a public one planned nearby? The free market depends on the pressure of demands, which can be supplied because of the reward of profit, fame, et cetera. All of which is quashed by public competition…producing LESS economic activity, prolonging, or even creating, economic downturn.

Investment

This is even true of investment. Why risk money buying stocks, or investing in any other resource that actually helps create wealth and grow the economy, if the government is issuing trillions in bonds that it can guarantee, at gunpoint, it will be able to afford to pay off?

This is part of why the US stock market is below where it was a dozen years ago; the past nine years of massive growth in government spending have crowded out even investment, depressing economic growth and the availability of money for business and individual use.

Chilling Effect

1164432_carpenter_series_1Capitalism helps society prosper, in part, by requiring that businesses be efficient and useful, or else be displaced by other, better, more efficient competition. Government “stimulus” spending helps bad behaviors and inefficient companies survive, preventing the openings for new, better ways.

Reward Failure

Government spending, too, has to reward failure and punish success, directly. Not just by bailing out failures, but with its own agencies: It would be irresponsible to expand the budget of a project that was already coming in ahead of schedule and under budget. What a waste of taxpayer dollars! Instead, if the agency wants to expand its budget, it must fail. It must show how it is over budget and behind schedule, and how natural this is, how more money and power will help it achieve its goals.

Punish Success

Meanwhile, responsible, productive businesses are punished for their contribution to society.

What if Ford ends up the weakest of the three automakers, because it didn’t take the thirty billion taxpayer dollars and declare bankruptcy? What does this tell companies in other industries, when they’re considering whether to be productive, or else squander money and go crying to the stimulus committees for bailouts?

Government Gangrene

There are hundreds of billion dollars in bad investments, loans, et cetera, that need to simply fail, because they cannot ever be productive. Right now they are gangrene on society’s body, just burdening our health and slowly spreading…but the stimulus/bailout money keeps them from being removed, and even helps them expand, quashing healthy alternatives.

The Solution

In each case, around the world in history, the only way to get out of economic depression was for the government to STOP killing the economy with its fake “stimulus” packages.

Examples

It took Japan and Sweden ten years to figure this out. Some other countries never have, and still are suffering for it.

Even in the US, the government constantly expanded spending to “stimulate” from 1929 through 1938, and only truly enjoyed healthy economic growth when spending and regulation were massively cut in the late forties and fifties.

The opposite of this was the depression of 1920-21, where banks failed, commodity prices plummeted (like housing prices now), the stock market crashed…and the US government did virtually nothing.

That lack of “stimulus” resulted in a depression less than two years long, unlike the decade of the other examples.

Check out the extensive history of economic downturns in the US, for more.

Self-Transfusion?

Ultimately, government spending actually sucks the life out of the economy, increasing and prolonging economic depression, because it must take private money in order to “spend” the public money…as if you gave yourself a blood transfusion by taking blood your left arm and putting it in your right…with the stress of the transfusion actually leaving you weaker than when you started.

July 15, 2009 Posted by | Economy, Politics | , , , , , , , | 14 Comments

   

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