Monday, July 28, 2014

Government and Your High-Speed Internet


The Republican-led House of Representatives recently attached an amendment to a funding bill that would stop the Federal Communications Commission (FCC) from preventing state prohibitions on city-owned internet service providers.

This is a bit of a complicated issue because we are dealing with so many layers of government.  From the standpoint of a liberty advocate, it is best to promote the free market in all areas, including internet service.  But if there is going to be government involvement, then decentralization is better than centralization.

The city of Chattanooga in Tennessee provides high-speed fiber optic networks for residents and businesses at a cost of about $70 per month, and it is much faster than the average internet service.  But the city is prevented by state law in expanding its services to nearby communities.

Telecommunication companies are against such city-owned operations because they complain that they can’t compete.  Unsurprisingly, these companies favor state laws to prohibit city-owned internet providers.

The FCC is trying to intervene in favor of the cities.  The Republicans in the U.S. House are trying to stop the FCC from intervening.

When you have this much of a tangled mess, it is hard to figure out the pro-liberty position.

Republican Politics May Be Right Here

I have no idea the motives of the politicians in the U.S. House who support this amendment to prevent the FCC from interfering.  My guess is that a lot of them are supporting this amendment because they are supporting big telecommunication companies.  My guess is that this is more cronyism than it is principle.

But this also doesn’t make the Republicans and the supporters of this amendment wrong.  They might be right for the wrong reasons.  From a constitutional standpoint, they are right that the FCC should really not get involved.

The FCC is saying that cities should be able to restrict competition from community broadband if it is being done by elected local officials on behalf of the people.

In other words, the FCC doesn’t think the state should be telling the city what to do.  They are advocating decentralization by having a federal agency (itself) tell state governments what they can and can’t do.

This is one of those difficult issues for those in the pro-liberty camp because it is almost a choice between centralization of government and stifling competition.

In regards to providing internet service, it may sound strange that a liberty advocate would be supporting city-owned internet providers.  But it isn’t support for government, even at the local level.  It is support for decentralization.  I would rather have competing models between cities than have one uniform state law that every city must abide by.  Likewise, it is better to have various state models than one federal law dictating how 300 million people will live their lives.

The other interesting point about this whole story is that there is not much of a free market anyway with internet providers.  It is no more free market to have a city grant a monopoly to one private company as it is for the city to act as the internet provider.

As technology gets better and better, I hope this debate becomes a thing of the past eventually.  I hope that internet providers become something like the Post Office is becoming, which is obsolete.

There is politics coming at us from all angles here and let’s hope that technology eventually makes all of this politics obsolete.

Sunday, July 27, 2014

Eminent Domain and Property Rights


A cornerstone of civilization is property rights.  Without property rights in a world of scarce goods, there is chaos.  It is no coincidence that those societies that have had a greater respect for property rights are the same societies that have achieved much greater wealth.

Unfortunately, in America, the supposed land of the free, property rights have become less respected in many ways through the years.  Taxation itself is an infringement on property rights - the property being the money you have earned.

But there is also the use of eminent domain, where the government will physically seize property, including houses, supposedly for the public good.  How violating property rights by taking people’s houses is good for the public, I’m not sure.

There is a case in Pennsylvania, just south of Pittsburgh, where Sunoco Logistics Partners is building a pipeline to transport natural gas.  The company lobbied the Pennsylvania Public Utility Commission to affirm its status as a “public utility”.  This enables it to take advantage of state law in using eminent domain.

Ronald and Sallie Cox owned a home with beautiful views in which they thought they were secure in.  They had lived in it for over 10 years when a representative for Sunoco Logistics Partners approached them about building a pipeline.

After the homeowners refused to grant permission to build a pipeline on their large property, Sunoco sent a letter stating that it had the power of eminent domain and made an offer to the Coxes, basically forcing their hand to accept.

The good news is that there has been quite an uproar with all of the properties involved where this pipeline is being built.  There is pressure on legislators from both sides and there will be many court battles on this issue.

The bad news is that this is a company with deep pockets that has the ability to lobby politicians.  In addition, some politicians see the benefit (for them) of having greater tax revenues by allowing the pipeline.

Perhaps some who defend the pipeline are doing so because they see the need for more energy.  And perhaps some who criticize the pipeline are doing so for environmental reasons.  But the real issue here is property rights.  If property rights are respected, then the other issues should become moot.

The 5th Amendment

The last part of the 5th Amendment to the U.S. Constitution reads “nor shall private property be taken for public use, without just compensation.”

While I believe we would be much better off today if our elected politicians were to actually follow the Constitution, it still doesn’t make the Constitution perfect.  This clause in particular, I have great difficulty with.

“Just compensation” is a very subjective term.  The government is going to judge what is “just” in what it pays to take the property?

The only just compensation is what the owners of the property are willing to sell it for without any threats of seizure.  If Sunoco really wants that property bad enough, then they should offer the couple what they need to.  If the couple refuses to sell it or permit a pipeline on it, even for a really high price, then that is too bad for Sunoco.  The company can buy up other property or make agreements with other property owners and build the pipeline around them.

In a free society where property rights are fully respected, I can’t imagine a situation where eminent domain is just.  Regardless of whether it is to build a school, build a road, build a pipeline, or build a business, there is no justice in using the force of government to seize other people’s property, even if they are “compensated”.

The use of the phrase “public good” is a fallacy.  Who is the public?  It is the same people who own property themselves, whether it is houses or anything else.  The shareholders of Sunoco are also property owners and I don’t think they would like it if someone came in and took all of their shares at a price not determined by willing buyers and sellers.

If a company or government wants a piece of land, they can obtain it the way the rest of us typically do.  They can buy it.  If the owners refuse to sell, then that should be their right as the owners of the property.

Monday, July 21, 2014

San Francisco Bans Free Market Solutions


The city of San Francisco is known for its left-wing politics, so one of the latest stories out of the city should not surprise us too much.

There is an iPhone app called MonkeyParking and it was designed to allow people to essentially auction off a parking space before leaving.  If your car is in a parking spot and you are ready to leave, you can set the location of your spot on the app.  Then people will bid on your spot and the highest bidder will get your parking spot, and you will get the money.

Of course, this is the free market in action, with voluntary individuals coming together for a mutually beneficial agreement.  Therefore, city officials can’t allow this to go on.

The city attorney, Dennis Herrera, has shut down MonkeyParking’s operations in San Francisco by threatening a lawsuit if it continues.  He cited a provision in the police code that prohibits buying, selling, or leasing public on-street parking.

It is interesting that the free market is always trying to solve problems, especially created by the government in the first place.  San Francisco has strict zoning laws and it should not be surprising that the government is not operating efficiently when it comes to managing the streets and the parking on the streets.

Supply and Demand

As with so much in life, this comes down to supply and demand.  When there is a lack of supply and a heavy demand, such as the parking situation in San Francisco, then the only way to fix this is by having higher prices.  It doesn’t matter if it involves houses, water, labor, or parking spaces.  In order for the market to clear, prices need to go up.

MonkeyParking was an innovation that helped solve this problem.  It was a free market solution to a government problem.  But now the government is exacerbating the problem by banning the use of the app.

This app allowed people who really wanted or needed a parking spot to get it.  They just had to pay a higher price.  But it was obviously worth it to these people.  Maybe someone had a business meeting he had to get to.  Maybe someone had an appointment at the doctor.  Maybe someone was late for a date.

So who is the city attorney protecting here?  I suppose it is the people who don’t want to pay as much for parking, even though they have trouble finding a spot anyway.  This is an app that was beneficial for people who desperately needed parking.  It was also beneficial for someone leaving his parking spot to get a few extra bucks.

This app was an attempt to help solve the supply and demand problem of parking spaces.  It was serving to more efficiently allocate a resource in short supply.  Unfortunately, some people, particularly San Francisco politicians, don’t want to hear about economics.  They think it is insensitive.  They want you to see the human side.  But the human side is that there are a lot of people driving around, wasting time, looking for a place to park their car.

San Francisco may be a beautiful city to some, but the politicians there, along with the people electing them, could use a lesson in Economics 101.

Thursday, July 17, 2014

Food Freedom and Your Health


We should be thankful that we live in a time period where our standard of living is high and food is in abundance.  There may still be some people in this world, in third-world countries, who are near starvation, or at least malnourished.  But in America, most poor people eat.  America is one place where you will find that even some poor people are overweight.

When it comes to food in America, it is a mixed economy.  It is a combination of the free market and government control.  Sometimes I will get in to discussions with people about liberty.  They will say that the government has to do this or that because that is the way it is done now.  I like to respond that if the government ran the grocery stores, many people would say that the free market would not be able to provide such a service.

I have little idea how grocery stores operate.  I don’t know how they predict what consumers will buy, other than past patterns.  I don’t know how they get trucks to deliver food.  I don’t know how they stock their shelves and how they rotate their food.  But I don’t really need to know much about grocery stores.  There are other people who do know what to do and the competition ensures that the best run grocery stores are the ones that stay open.

It is a scary thought to think of what grocery stores might look like if the government were in charge of them.  We would probably be eating the same thing for breakfast, lunch, and dinner every day.

But while grocery stores are somewhat free market, the foods that are sold in them are under a lot of government control.

Food Freedom

There was a recent report put out by the Institute for Justice entitled The Attack on Food Freedom.  It details some of the government intrusions and outright harm that is done.

The government will often do things in the name of “protecting consumers”, but it is still an infringement on our liberty.  In some cases, it even has the opposite effects.

These government intrusions come at us from all levels.  They come from the federal government, state governments, and local governments.

There are obvious infringements or attempted infringements that people have heard about, such as banning the sale of large sodas.  But there are also a lot of areas where people are not even aware that the government is involved so heavily.

The report discusses that much of the origin of the American Revolution was a result of economic liberty and food freedom.  But while the American colonists were well aware of what was happening to them, Americans today have little idea.

Interestingly, it was a Supreme Court case involving food in the 1930s that set a bad precedent that we continue to pay for today.  In Wickard v. Filburn, a wheat farmer named Roscoe Filburn exceeded his quota of wheat production, which was part of Roosevelt’s New Deal program.  Filburn argued that his excess wheat was for personal consumption and therefore had no effect on interstate commerce.

The Supreme Court ruled that Filburn’s consumption of the wheat he grew could still have an effect on interstate commerce.  The Supreme Court really turned the Commerce Clause on its head and this is the clause cited today for many of the violations of the Constitution, which is most legislation and edicts.

Big Government Today

In our world today, we have to live with the Food and Drug Administration (FDA) and crazy laws such as the Food Safety Modernization Act (FSMA), which was passed three years ago.

It is not surprising that the FSMA particularly hurts small farmers and food entrepreneurs.  It is legislation that keeps out the little guy, while big business gets the government-granted privileges.  But that is far from the only thing.

In the Institute for Justice’s report, it details the government’s war against raw milk.  The report states:

“Another symbol of the FDA’s attack on food freedom in the name of so-called food safety is the agency’s heavy-handed enforcement of its ban on the interstate shipment and sale of unpasteurized (raw) milk.  Many states also ban the sale of raw milk.  The FDA adopted its ban reluctantly in the late 1980s due to a lawsuit by Public Citizen that ultimately forced the agency’s hand.”

Opponents of raw milk argue that it can be dangerous due to bacteria.  But many health proponents see this as a benefit, as your body needs beneficial bacteria to properly function.

Just like any food, raw milk can be potentially dangerous if it is mishandled.  But that is also true of any food, including meats and vegetables.  The point is that consumers are not being allowed to freely choose for themselves.

This gets even more egregious when you look at the government’s actions to enforce its laws.  As the report states: “In 2011, for example, the FDA – along with U.S. Marshals and a state police officer – carried out an armed early morning raid on the rural Pennsylvania farm of Dan Allgyer.  The raid was the culmination of a yearlong undercover investigation into Allgyer, who the FDA determined was providing raw milk to consumers in the Washington, D.C. area, in violation of the agency’s ban on interstate sales.”

So if buyers and sellers voluntarily try to do business with each other in violation of the government’s rules, they will come in with their guns loaded.

The report points out that it is not just the FDA, but also other departments such as the Department of Agriculture that continually harass people in the food business.

Local Abuse

The report also details that it is not just rules and regulations coming down from the federal government.  In many cases, it is state and local laws that we have to deal with.

The report gives one example as follows: “In 2013, Miami Shores, Fla., amended its ordinance to prohibit front-yard vegetable gardens and informed Hermine Ricketts and her husband Tom Carroll that they faced fines of $50 a day if they did not destroy their beautiful garden.”

There are many more cases where cities violate property rights with ordinances that make little sense.  It doesn’t just happen in places like New York City where they try to ban big drinks.  It is happening all over.

When Will This End?

The report doesn’t even get into many of the other outrageous things that government does to our diet.

Whether it is putting fluoride in our tap water or promoting high fructose corn syrup, it sometimes seems as though the government is almost trying to kill us.

In some cases, it may just be politicians and bureaucrats that don’t know better.  In many cases, it is likely just pure politics, where lobbyists for big businesses get politicians to pass legislation in their favor in exchange for their support.

As long as politics exists, this will continue.  Fortunately, with the technological age we live in today, we can communicate more freely.  I believe that many more people are becoming aware of the fact that they shouldn’t listen to what the government tells them.  They are taking their health into their own hands and finding ways around the regulations, such as going directly to local farmers.

We should continue to educate people on this subject and make them aware of the things that government is doing to them, or preventing them from doing.  We each own our own body and we should be free to put whatever we want in to it.  I can drink raw milk without forcing anyone else to do so.

Monday, July 14, 2014

Government Contracts Are Not Part of the Free Market


There are some critics of government who think that contracting out government work is a more efficient way of doing business.  Some even believe that having the government hand out contracts is a form of free market capitalism.

Of course, when government contracts are awarded, it is still using taxpayer money.  It is not as if consumers are freely choosing the services.

But while issuing government contracts has little to do with free market economics, there is a decent argument to be made that it can be more efficient than having government agencies do the work.  I suppose the next question is whether we actually want more efficiency in government.

It was recently reported that a security contractor has received a $190 million contract to do administrative work for the U.S. Citizenship and Immigration Services.

The company that received the award is U.S. Investigations Services LLC (USIS), which is alleged to have previously defrauded the government by performing insufficient background checks for highly sensitive government jobs.  This trouble began three years ago and the company was later sued by the Justice Department.

The company has also received some other bad press, as it was reported that USIS was in charge of the background checks of Aaron Alexis, the Navy Yard shooter, and Edward Snowden, the NSA whistleblower.

In regards to Edward Snowden, I suppose this might be one scenario where we should be happy that government contractors are not always efficient.  There are many other instances where we should be glad that government workers and government contractors are not efficient.  I do not want an efficient IRS.  I do not want an efficient NSA.

Cronyism

Just because government work is contracted out to the “private” sector, it doesn’t mean it takes the politics out of it.  Someone has to award the contracts.  Are we going to be so foolish as to think that there is never any kind of favoritism, for whatever reason?

I have no idea if there was any cronyism involved with this immigration contract.  USIS won the contract with the lowest bid.  Maybe it really was better than the alternatives.

Regardless of this one contract, we must realize that government spending is still government spending, even if it is in the form of contract awards.  And we should always expect that there is going to be favoritism.  Politicians and bureaucrats have friends.  There are usually lobbyists involved.  I’m guessing it is in a minority of cases where a contract is awarded solely based on price and quality.

If anything, cronyism will actually increase with more government contracts.  Most government agencies are bureaucracies.  Some of the employees may be very intelligent, but most of them are staying under the radar.  They want their funding to continue.  They want to make sure they collect their pension upon retirement.

The U.S. does not have a socialist system.  The government does not own the means of production in most cases.  It is more economic fascism.  It is corporatism.  The government is calling the shots in many cases, but there are companies making money.  Some make money by selling consumer goods and services that are in demand.  This is the capitalist portion.  Others make money through government contracts and through lobbying government for regulations to keep away competition.

Cronyism is not going to stop any time soon.  The only way it can be stopped or reduced is by reducing the power of the politicians in government.  This means reducing the funding.  The less money that the politicians can spend, the less that can be wasted.

Sunday, July 13, 2014

An Important Step in Getting Privacy From Government


The ACLU recently published an interactive map on the web that categorizes states based on the strength of privacy laws enacted.  This was based on four categories of privacy laws which included law enforcement access to electronic communications, location tracking, automatic license plate readers, and domestic surveillance drones.

It was noted that just because there is a state law regarding privacy protections in one or more of the listed areas, it does not automatically translate in to stronger privacy rights.  For example, Texas has drone laws, but these laws are insufficient and may even be harmful to individuals.

According to the ACLU’s map, Utah was the winner as the state with the greatest privacy protection.  It is ironic that Utah is one of the most conservative states.

It is often thought that, from a libertarian standpoint, Republicans are stronger on economic issues and Democrats are stronger on issues of civil liberties.  So it is interesting to note that heavily Democratic states such as California and New York did not rank well for privacy protections.  But it is also fair to note that there are some Republican/ conservative states that did not rank well either.

Decentralization is Our Only Hope

In a country of over 300 million people, it is almost impossible to significantly change anything in Washington DC.  It is even hard when there are millions of people trying to change the same thing.

Washington DC is run by lobbyists and corporate interests.  It is also run by bureaucracies.  It is quite difficult to change this.  I have pointed out in the past that is almost impossible to get rid of the National Security Agency (NSA), barring some kind of major federal bankruptcy.  Even then, I’m not so sure.

But there is a little bit more hope in seeing that many states are passing laws to provide greater privacy protections from government.  This must continue.  I always say that if you can’t change a local or state law, then there is no way you are going to make it happen on the national stage, assuming it is a change that would somehow reduce government power.

One thing we will eventually need to see are state laws with some teeth against the federal government.  We can’t put the cart before the horse though.  We must see strong state laws against government spying that are first enforced at the state and local levels.  When this becomes more widespread, then we may begin to see some stronger stands against Washington DC.

One possibility is that states begin to invoke the idea of nullification.  State laws should be passed that essentially nullify federal laws (or actions) because they are unconstitutional and a clear violation of liberty.  Federal spying with no warrants is not authorized by the U.S. Constitution.

The big question comes if the states actually try to enforce this.  What are the states going to do to stop a federal government that is constantly spying?

It is probably not a coincidence that Utah was ranked as having the best privacy protection laws when the NSA has a huge data center in the state.  This is where your emails and other electronic communications are being stored.

There are already movements that are attempting to get Utah legislators to shut off the water supply going to the data center, as it supposedly uses over one million gallons of water every day.  While I think this movement is probably premature, it is an interesting idea.  But for the Utah legislature to take a stand this big against the powerful U.S. government, it is going to take some major support from the citizenry.

As technology continues to advance, the NSA is only going to get worse.  We will live in a world of virtually no privacy.  The good news is that free individuals and groups of individuals will also use new technologies in ways to fight back and make the NSA’s job more difficult.

There are going to be different methods of fighting the NSA.  But before we can have major success, we have to win battles at state and local levels.  It is good to see that we are at least making a little progress.

Tuesday, July 8, 2014

$2 Billion on Illegal Immigrants


See update below.

The Obama administration is asking Congress for over $2 billion in funding to deal with the new flood of immigrants across the border from Mexico.  Many of these immigrants are children, oftentimes without accompanying parents, who are originating from Central America.

While this story has received some recent attention, it really is probably being under reported.  The curious thing is that there is not a universal explanation for the huge wave of children that are all of a sudden pouring in.  Of course, all of these immigrants are coming across illegally.  Most of them are really poor, especially by American standards, and they are fleeing their home for a reason.  If it is just because they are from poor countries, it doesn’t explain why there has been such a huge number in just the last year.

Obama is also going to request powers to deport immigrant children who arrive without their parents.  Perhaps the strategy of these parents was to send their children alone, in hopes that they would somehow be taken care of, once arriving in the United States.

If Obama and the federal government are going to deport tens of thousands of children, how are they going to do it?  How much is it really going to cost?  And what happens if the children and their parents are put at political risk by deporting them?  Is the U.S. government going to deport children facing a dangerous situation?

These are not easy answers, even for liberty advocates, to answer.  For Americans, we cannot easily change a bad situation in other countries.  We can only change our own situation.

Immigration and the Welfare State

One of the major causes of an immigration problem is that America has become a welfare state.  We are just a really wealthy welfare state.  The welfare state did not come about until after there was great wealth accumulation.  In other words, there are still a lot of goodies to be handed out.

If the U.S. wasn’t a welfare state, then there likely would not be as many illegal immigrants.  There would also be less opposition to immigration because anyone coming to the U.S. would most likely be coming to find work.  They would be productive people.  There are already a lot of productive immigrants, legal and illegal, but there are some who take full advantage of the welfare state.

Obama is going to ask for $2 billion to spend on this problem.  This will just be the initial request.  You can bet that it will end up being a lot more.  That is a great sum of money to extract from the American population.

Don’t get me wrong here.  I would rather Obama spend $2 billion on helping poor immigrant children than spending money on drones to drop bombs on children in Pakistan.  But it is not as if $2 billion in additional funding for immigration is going to stop drone bombings.

It is also hard to say whether this $2 billion or more in funding is going to help or hurt the children immigrants.  If it is simply to fund the cost of deporting them, then it will only hurt the children.  That seems like a lot of money to spend to ship children back to an unstable environment.

There is another unfortunate aspect of the welfare state.  Because the government at all levels takes almost half of our money (maybe more, if you include the cost of regulations), Americans are not in a great position to help.  Worse, many Americans are less charitable simply because they expect the government to act as a charity.

If there was no American welfare state and we still had the situation of tens of thousands of children flooding across the border, then I imagine that many people would step up to the plate and provide answers in the form of charity.

I don’t have many answers to this issue, just as nobody really has all of the answers.  The government certainly doesn’t have the answers.  But if we had a voluntary free market, then different people would be coming up with different solutions.  Some would work better than others.  The ones that work better would get more of the funding from other charitable people.

Some of the answers might lie in foster care and adoption.  There are many Americans who want to adopt children.  Another answer might be finding other countries where there are people who want to adopt.  There are other answers in reuniting the children with their parents, whether it be in the U.S. or in another place that is more stable than their original home.

I fully realize that these immigrants are illegal.  But that is just a reflection of U.S. law.  It doesn’t make these people criminals in the sense of common law.  Most of them are innocent people seeking a better life.  It is impossible to gain access to the U.S. by going through the bureaucracy legally.  It is possible for them to walk across the border illegally.

No matter how the situation is dealt with, it should be done with compassion.  Compassion doesn’t mean taking taxpayer money to solve the problem.  But these are human beings trying to survive and most of them are not trying to harm anyone.  And the government is not going to be able to solve this issue.  It can only be done with voluntary charity and a free market.

UPDATE:  The amount Obama is requesting is now up to $3.7 billion.