Fred Argy (Letters, 12/12) misses the point. The point of privatisation is not to generate revenue for government. Indeed, if I had my way there would be no selling involved - shares would be gifted to all Australians equally. The real objective of privatisation is to expose a service to the discipline of the market.
The true "furphy" of the proposed electricity sale in NSW is that it would not be full privatisation, because there are many regulatory impediments (such as price controls) that would prevent the free operation of the market. This would likely lead to suboptimal outcomes as suppliers would need to seek approval from bureaucrats to make operational decisions. Of course, then we could expect to hear criticism of privatisation!
(Letters to the editor, The Australian, December 14 2007)
Well-written fiction books are a pleasure to read. The good ones are full of plot twists, suspense, passion and can be life changing – or at least thought-provoking. They can make you laugh, cry and perhaps even become angry. Really good ones can capture the imagination of an entire generation, or are adapted to hit the movie screens. To use a recent and well known example, consider how much different the world would be without Harry Potter!
The Frankenstein Candidate is intellectually heavier than your average J.K. Rowling. In designing the plot, Kolhatkar seems to have set out with a clear purpose: to present a specific set of ideas about government and society. It’s a book that features jargon such as ‘Keynesianism’, ‘economies of scale’ and ‘inflation’.
The world Kolhatkar constructs is based around a US election where two of the leading candidates are Senator Olivia Allen and the wildcard billionaire Frank Stein. We are taken on a journey where Olivia and Frank, running on different policy platforms, find that they are more similar than they first thought. Stein is spending his fortune on a quixotic and straight-talking campaign for president, and in many ways reminds me of US Congressman Ron Paul’s most recent bid for the presidency.
Along the way, various shenanigans inspire interest in the characters’ personal stories. It’s here that Kolhatkar is at his best. For example, when he delves into the psyche of Olivia in a scene where she is consulting her psychologist about her ‘imposter syndrome’ (a condition that makes it difficult for her to believe in her own self-worth) the reader feels genuine empathy for her high pressure lifestyle and most people would be able to relate to some degree.
Kolhatkar is a believer in free-markets and libertarianism and the dialogue is written with this strong philosophical undercurrent subtly, and sometimes not so subtly, in mind. Lead characters are in the mould of Ayn Rand’s Atlas Shrugged – intelligent, principled and determined. Stein, for instance, is the type of person who’d say ‘I’d rather be right than be President’.
Where the book might fall short, at least according to mainstream populist standards, is in its focus on technical economic subject matter. Certain passages read like a business article rather than a fiction novel, but this is probably unavoidable given the context in which the story is being told.
Nonetheless, there can be little doubt that this is a novel that will leave readers intrigued. It certainly delivers what it promises: a fast-paced plot packed full of twists and turns that should cement Kolhatkar’s place as an original writer.
Published by CreateSpace Publishing (2012).
In 1945, the United Nations was founded amidst much euphoria. It was to be mankind's "last best hope": an organization that would tie all member-states together for collective security and peacekeeping purposes. But the U.N., useful as it has been in some minor cases where a broker was required, has been totally ineffectual at removing the harmful ideologies that cause war in the first place. It has done very little to quell aggressive economic and political nationalism, for example. But most disappointingly, the U.N. has been a destabilizing force. It has allowed itself to be used by the great powers, and especially America, to cloak militarism.
From 1945 to 1990, the U.N. was forced to limit itself to small-scale operations (with the exception of the Korean War) due to the prevailing Cold War rivalry between the United States and the Soviet Union. As the Cold War drew to a close however, another round of excitement swept through the globalist camp. "At last!" U.N. supporters declared, the organization could function as envisioned by its founders. Instead of tensions between the U.S.and the U.S.S.R. crippling the Security Council and placing some matters beyond its jurisdiction, there would be a new age of cooperation. This was to lead to a more effective institution.
But what did it mean to be more "effective" when the underlying ideologies of interventionism and nationalism still dominated foreign policy discourse? This question remained unanswered. Instead, the U.N. adopted a fallacious public sector definition of effectiveness. It prided itself in "doing something, anything" with its available resources (Rothbard 1974, p. 82). The more things it did, no matter how absurd, the more effective the U.N. bureaucrats claimed they were. Thus, the U.N. boasted of an increase in the size and scope of its operations. A new Department of Peacekeeping Operations was created. At its height in 1994, the U.N. had nearly 79,000 peacekeeping personnel; the organization had substituted small-scale operations with a permanent nation-building corps.
Since effectiveness was measured in terms of the scale of U.N. activities, rather than the usefulness of said activities, there was no discernable difference in the extent of world peace. Realpolitik struggles continued as they had been for thousands of years. There was no overarching strategy presented to achieve the Charter's objective of saving "succeeding generations from the scourge of war". The U.N. is, therefore, a typical example of an organization full of men and women brimming with enthusiasm, but who have no understanding of the bigger picture.
In the absence of a coherent strategy to bring about world peace, the U.N. was easily captured by the U.S.to suit its own ends at the end of the Cold War. With a submissive Russia now taking the place of the belligerent Soviet Union, America possessed a unique opportunity to ram through its agenda. As the most powerful nation on Earth, America could now focus upon using the U.N. as an instrument for its warmongering (Eland 2008).
So it was no surprise that President George Bush I immediately set about using the U.N. to provide multilateral credibility for his desires to protect Israel and oil interests in the Middle East. By assembling a coalition under the United Nations banner to take on Saddam Hussein, ostensibly over his invasion of Kuwait, Bush I was able to justify military action that had nothing to do with American national security. Thanks in part to the rubber stamp provided by the Security Council, the first Gulf War also helped push up Bush I's approval ratings.
President Clinton also took advantage of the changed balance of power on the Security Council. He placed heavy political pressure on the U.N.'s disarmament wing - the International Atomic Energy Agency - to investigate Iraq. Some allege the administration was hoping for an excuse to attack Iraq, or at least a way to trump up the threat of weapons of mass destruction. Support for this charge can be found in President Clinton's decision to sign into law the Iraq Liberation Act of 1998, which instituted a policy of "regime change". Clinton continued aggressing against Iraq by bombing it in a four-day campaign that was timed to be suspiciously close to impeachment proceedings against him (needless to say, the bombings served as a useful distraction). America also led a round of punitive U.N. sanctions that caused the deaths of hundreds of thousands of Iraqis. But there was hardly a wimper of opposition from the public; these outrageous acts of war had, after all, been done by appealing to the legitimacy of America's lapdog - the United Nations.
Years of hassling Iraq through the U.N. in order to boost popularity for the commander-in-chief culminated in George Bush II using September 11, 2001 as a pretext for outright regime change (in effect, taking the Iraq Liberation Act passed during Clinton's time a step further). Years before September 11, there was concern in the international community that America would use pre-existing U.N. resolutions as an excuse to implement its own agenda against Iraq (Mingst & Karns 2000, p. 105). How prophetic these concerns turned out to be!
When the time for prosecuting war came in 2003, President Bush II frequently cited Security Council resolutions passed during Bush I and Clinton's presidencies to justify his aggression. The quality of debate in America was degraded, as commentators began speaking of these resolutions as having independent authority - as if the U.N. were a neutral body and did not merely do whatever its most powerful members wanted it to do. All sense of perspective on the moral arguments for and against war was lost, as various sides tried to justify or oppose the invasion using legal terminology. Instead of asking whether it was right or wrong to attack Iraq, people began asking whether it was legal or illegal under international law. But surely the former is more important than the latter when so many lives are at stake?
The Iraq war is the culmination of at least 10 years of warmongering by America through the United Nations. The same pattern is now being repeated against Iran, with President Trump taking a hard-line, just as Bush II did before him. We can expect, no doubt, that any future attack on Iran will also be justified with reference to U.N. resolutions. Hopefully, libertarians would have by then persuaded Americans of the need to withdraw from the U.N. It is imperative that power elites be stripped of their ability to utilize this tool that legitimizes war.
As public choice theory predicts, "bureaucracy capture" has occurred at the United Nations. This is not surprising, given its highly politicized nature. We should expect that the powerful will use the organization as an instrument for their own schemes. In this sense, the U.N. is not an organization dedicated to achieving peace. Rather, it is dedicated to achieving whatever the dominant nation or nations at the relevant time deems worth achieving.
Murray Rothbard, "The Fallacy of the Public Sector" in Egalitarianism as a Revolt Against Nature and Other Essays (Libertarian Review Press, 1974).
Ivan Eland, The Empire Has No Clothes: US Foreign Policy Exposed (Independent Institute, 2008).
Karen Mingst and Margaret Karns, The United Nations in the Post-Cold War Era (Westview Press).
There is continuing debate among scientists over the extent and causes of global warming. Some say warming will be minimal; others argue that the world is facing a significant challenge which could harm future generations. Almost nobody suggests that the planet is cooling.
Yet science is only half of the debate. The other half is concerned with the appropriate policy response. This involves economists, not scientists. Unlike its scientific counterpart, the debate on what exactly should be done in response to global warming is not even close to completion. Here too, there is diversity of opinion. Some say Australia should implement a carbon tax. Others prefer a carbon trading system. Most agree the best solution would be one which reduces carbon dioxide emissions, and also does not harm economic growth.
The Rudd government acted quickly without waiting for the economics debate to run its course. A new department dedicated to tackling climate change has been established. Its mandate is to implement and recommend policies that would reduce Australia’s greenhouse gas emissions.
But there’s a problem. While bureaucrats in the Department of Climate Change are busy coming up with ways to ward off the global warming bogeyman, their colleagues in the Department of Industry are diligently subsidising the very fossil fuel companies that contribute to global warming. A study released by the Australian Conservation Foundation in 2006 found that a large amount of corporate welfare is given to causes that hurt the environment. As The Age reported on October 29 of that year, “Analysis of this year’s federal budget papers reveal that programs for activities that increase greenhouse gas emissions will attract total funding of about $8 billion in the 2006-07 financial year.”
Does it seem odd that two agencies are actively working against each other? It appears to be accepted practice within the government, judging by the lack of protest.
About $570 million was distributed as industry assistance to car manufacturers. Of course, eliminating this subsidy could result in the loss of jobs. However, as the car industry receives recurring grants on an annual basis, it would be cheaper to give every sacked worker a taxpayer-funded severance payment, rather than persist with a policy that not only harms the environment but also distorts the market.
Some environmental groups prefer increased government spending on other more ‘appropriate’ programs, regardless of whether these subsidies are eliminated. This can only exacerbate the problem. As politicians must always be seen to be ‘doing something’ about the environment, there is a risk that ill-conceived ideas adversely impacting standards of living will be implemented.
This would not be so bad if measures addressing climate change occurred at a state rather than Commonwealth level. Some states with heavy industry like Western Australia, could adopt a different response to states with less industrial development. Unfortunately, this ideal is practically impossible given the growth in federal government power over the past century, so we are stuck with a one-size- fits-all environmental management that does not adequately take into account regional variations. Anything the states do tends to supplement, rather than replace, federal environmental regulation.
We must not hand further discretion to the government to spend on programs considered beneficial, as this additional spending could result in similar unintended consequences. We should only demand that all subsidies to fossil fuels cease. The effect of eliminating these subsidies could then be noted, and this evidence could further contribute to environmentally-friendly policies.
A cautious approach towards climate change is appropriate given that the costs of government intervention, when mistakes are made, can be exceptionally high. And the benefits can be disappointingly low.
Which politician will have the courage to stand up to vested interests that benefit from lavish subsidies? Once time permits, a thorough analysis of the Rudd government’s budget for 2008-09 (released on May 13) will reveal if there is any improvement upon the Howard government’s record. However, I am not optimistic!
Originally published in Indian Link (May 2008).
1. Friedman’s money growth rule, which would be a legislated rule instructing the monetary authority to achieve a specified rate of growth in the stock of money. For this purpose, Friedman defines the stock of money as including currency outside commercial banks plus all deposits of commercial banks. He "would specify that the Reserve System should see to it that the total stock of money so defined rises month by month, and indeed, so far as possible, day by day, at an annual rate of X per cent, where X is some number between 3 and 5" (Dollars and Deficits, p. 193).
2. A gold standard is another reform aimed at reducing arbitrariness in monetary policy. Former Chairman of the Federal Reserve, Alan Greenspan, once defended gold because of its ability to act as a restraint on government. "The idea behind a gold standard," Reed observes, "is to remove from the hands of politicians or their political appointees the discretion of determining a nation's supply of money". Under a gold standard, individuals have a legal right to redeem the notes they hold for gold from the central bank’s vaults. As a result, the central bank must have reference to the amount of physical gold before changing the money supply. By contrast, under the current prevailing fiat paper standard, monetary authorities have complete discretion: they can inflate or contract the money supply at will.
3. Another means of eliminating discretionary power in monetary policy is to legalise free banking, a system where private banks are permitted to issue their own notes. Since free banking does away with the need for a central bank (there is no ‘lender of last resort’), monetary policy is denationalised and decentralised away from state control, removing the ability of a few individuals sitting on a monetary policy board to control a nation’s money. Under a regime of free banking, commercial banks are lightly regulated and are treated the same as any other business, subject only to the general company law.
Andrew Norton's support for the budget's changes to higher education repayment thresholds (Age Online, 10/5) makes no sense for those who have received little or no benefit from their studies.
Nobody is entitled to free money from taxpayers. However, it undermines fairness to penalise, for example, unemployed law graduates who cannot get a job because the government – in association with legal professional bodies – do their best to minimise competition in the industry. (For example, by setting up barriers to registration as a lawyer, requiring extensive formal study when there are flexible and cheaper internship-based options to convey knowledge.) At the same time, MPs and bureaucrats enjoy luxurious perks and pensions.
Why not go after the most marginalised in society last, after the elites have had their generous salaries cut?
(Published in The Age, letters to the editor, 12 May 2017)
In spite of the mass murder perpetrated by the governments of the Soviet Union, China, Cuba, and many other “revolutionary” societies, socialism continues to have many real world adherents. So deep is the faith that even India’s former finance minister Palaniappan Chidambaram, in an interview with TIME magazine in 2005, professed that “Socialist goals remain valid. What we are trying to do is devise and invent better means to achieve those goals”.
For socialists, the standard retort is that none of the societies that we traditionally consider as socialist were socialist. Rather, they were “state-capitalism”.
Even if that were true, the dictionary definition of socialism doesn’t inspire much confidence either.
Would you be in favour of an economic system in which it’s assumed that the government owns everything, including your body? Because that’s what socialism is – “government ownership and control of the means of production”. The “means of production” are land, labour and capital. Under socialism, individuals (labour) are mere cogs in the government’s machine; their sole function is to obey dictates from the central authorities.
Socialism is merely a variant of what used to be called feudalism. Before the advent of democracy, kings would demand complete obedience from their subjects, usually by appealing to superstition and religion. In this way, the elites cemented their power and exploited the population.
Of course, eventually the people decided to revolt: the French and the American revolutions ushered in the idea that all human beings have a right to their life, liberty and property without interference from the government. After these revolutions, the intellectual climate changed, and the lies of the monarchy no longer worked to the same extent. Thus, the rulers were forced to give up some of their power – and the end result was democracy, in which citizens freely elect their representatives.
But unfortunately, the constant struggle between those who wish to wield power and those who are victimized by it (ordinary folk like you and me) hasn’t ended. Democracy may allow us to choose our leaders, but it doesn’t guarantee that they won’t abuse private property rights while they’re in office. The lies of the elites are still being propagated, although it’s a lot more subtle.
One of the biggest lies is that we “need” government to commit theft against productive citizens in order to provide services such as healthcare, education and defense. Convincing the public to believe this has been a primary objective throughout history. Government, according to the parasites that live off taxpayer money, simply must exist.
Nothing could be further from the truth. When it comes to education and health, there is ample evidence that the private sector could provide these services cheaper and at higher quality. But what about defence? Do we need a government to provide security? Two brilliant theorists – Murray Rothbard and Hans Hermann Hoppe – have argued that we do not, and I tend to agree with them.
Whether Rothbard and Hoppe are right or wrong is a debate for another day. My point is simply this: socialism is an historical regression towards feudalism, under which we are all slaves of the government. The soft-socialists of today – social democrats – would do well to take note.
“War is liberty’s greatest enemy, and the deadly foe of economic progress”.1
- Leonard Read
An essay in Policy by Edwin van de Haar (Autumn 2009) does a great job of explaining how libertarian principles apply to international relations. According to Haar, libertarians are opposed to international organisations, treaties and foreign aid. They also advocate free trade as a means of increasing cooperation between nations and reducing the likelihood of conflict.
And although Haar does not say this explicitly, libertarians are also hesitant about intervening militarily.
In Australia debate on issues of foreign policy is dominated by conservatives and social democrats, both of whom favour intervention overseas. The only difference between the two mainstream ideologies pertains to the particular instances on which they would intervene. Social democrats tend to be sympathetic towards so-called ‘humanitarian interventions’, while conservatives favour ‘police actions’ such as in Iraq.
But the libertarian rejects entirely the mainstream consensus surrounding intervention. Rather than assuming that states have a right to intervene and then quibbling on where and when, the libertarian draws upon the great tradition of non-interventionism, or neutrality, in foreign affairs.
Non-intervention was the hallmark of American foreign policy for nearly a hundred years, and has the advantage of avoiding all wars not essential to the territorial defense of a country.
The logic behind non-interventionism derives from a fundamental axiom of liberal thought that no person may aggress against another unless in self-defence. It becomes apparent then that all State wars are unjust, for they are financed through coercively acquired taxes, which are itself an act of aggression - and therefore forbidden.
But we need not go this far to a pure libertarian position to understand why non-intervention is beneficial. For libertarians the key rationale behind opposition to war is encapsulated in Randolph Bourne’s famous dictum that “War is the health of the State". It is during times of war that the government grows most swiftly. Thus it was liberals such as Richard Cobden, not those of the ‘left-wing’, who were among the first to rail against imperialism and colonialism.
There is a contradiction between claiming to support laissez faire on the one hand, and approving of foreign policy adventurism on the other. Self-described classical liberals who support war are actually going against the very philosophy they claim to espouse. Even if the cause is just, and even if one emerges victorious, the end result of war is usually a permanent increase in the size and scope of government.