Quote of the Day: Why the Worst Get on Top

The great Austrian economist F. A. Hayek explained of why the worst people rise to become despots or totalitarians: (An excerpt from Chapter 10, Road to Serfdom (University of Chicago Press, 1944) as published by Fee.org (bold added)

It would, however, be highly unjust to regard the masses of the totalitarian people as devoid of moral fervor because they give unstinted support to a system which to us seems a denial of most moral values. For the great majority of them the opposite is probably true: the intensity of the moral emotions behind a movement like that of National-Socialism or communism can probably be compared only to those of the great religious movements of history. Once you admit that the individual is merely a means to serve the ends of the higher entity called society or the nation, most of those features of totalitarian regimes which horrify us follow of necessity.

From the collectivist standpoint intolerance and brutal suppression of dissent, the complete disregard of the life and happiness of the individual, are essential and unavoidable consequences of this basic premise, and the collectivist can admit this and at the same time claim that his system is superior to one in which the "selfish" interests of the individual are allowed to obstruct the full realisation of the ends the community pursues. When German philosophers again and again represent the striving for personal happiness as itself immoral and only the fulfilment of an imposed duty as praiseworthy, they are perfectly sincere, however difficult this may be to understand for those who have been brought up in a different tradition.

Where there is one common all-overriding end there is no room for any general morals or rules. To a limited extent we ourselves experience this in wartime. But even war and the greatest peril had led in this country only to a very moderate approach to totalitarianism, very little setting aside of all other values in the service of a single purpose. But where a few specific ends dominate the whole of society, it is inevitable that occasionally cruelty may become a duty, that acts which revolt all our feeling, such as the shooting of hostages or the killing of the old or sick, should be treated as mere matters of expediency, that the compulsory uprooting and transportation of hundreds of thousands should become an instrument of policy approved by almost everybody except the victims, or that suggestions like that of a "conscription of women for breeding purposes" can be seriously contemplated. There is always in the eyes of the collectivist a greater goal which these acts serve and which to him justifies them because the pursuit of the common end of society can know no limits in any rights or values of any individual.

But while for the mass of the citizens of the totalitarian state it is often unselfish devotion to an ideal, although one that is repellent to us, which makes them approve and even perform such deeds, this cannot be pleaded for those who guide its policy. To be a useful assistant in the running of a totalitarian state it is not enough that a man should be prepared to accept specious justification of vile deeds, he must himself be prepared actively to break every moral rule he has ever known if this seems necessary to achieve the end set for him. Since it is the supreme leader who alone determines the ends, his instruments must have no moral convictions of their own. They must, above all, be unreservedly committed to the person of the leader; but next to this the most important thing is that they should be completely unprincipled and literally capable of everything. They must have no ideals of their own which they want to realise, no ideas about right or wrong which might interfere with the intentions of the leader.

There is thus in the positions of power little to attract those who hold moral beliefs of the kind which in the past have guided the European peoples, little which could compensate for the distastefulness of many of the particular tasks, and little opportunity to gratify any more idealistic desires, to recompense for the undeniable risk, the sacrifice of most of the pleasures of private life and of personal independence which the posts of great responsibility involve. The only tastes which are satisfied are the taste for power as such, the pleasure of being obeyed and of being part of a well-functioning and immensely powerful machine to which everything else must give way. 

Yet while there is little that is likely to induce men who are good by our standards to aspire to leading positions in the totalitarian machine, and much to deter them, there will be special opportunities for the ruthless and unscrupulous. There will be jobs to be done about the badness of which taken by themselves nobody has any doubt, but which have to be done in the service of some higher end, and which have to be executed with the same expertness and efficiency as any others. And as there will be need for actions which are bad in themselves, and which all those still influenced by traditional morals will be reluctant to perform, the readiness to do bad things becomes a path to promotion and power. The positions in a totalitarian society in which it is necessary to practice cruelty and intimidation, deliberate deception and spying, are numerous.

Neither the Gestapo nor the administration of a concentration camp, neither the Ministry of Propaganda nor the SA or SS (or their Italian or Russian counterparts) are suitable places for the exercise of humanitarian feelings. Yet it is through positions like these that the road to the highest positions in the totalitarian state leads. It is only too true when a distinguished American economist concludes from a similar brief enumeration of the duties of the authorities of a collectivist state that they would have to do these things whether they wanted to or not: and the probability of the people in power being individuals who would dislike the possession and exercise of power is on a level with the probability that an extremely tenderhearted person would get the job of whipping-master in a slave plantation.

Quote of the Day: Integrity is adherence to your code of moral values

When I speak of establishing a strong moral foundation, I’m talking about possessing a clear set of values that guides your day-to-day behavior. You need to know what you believe in ahead of time so you don’t have to think about the right action to take at the moment of truth.

What do you believe is moral? What do you believe is immoral? What do you believe is ethical? What do you believe is unethical? What do you believe is good? What do you believe is bad?

If you don’t formulate your moral beliefs ahead of time, your actions may inadvertently be based on spur-of-the-moment whims, emotion, or instant gratification. In other words, you’ll be in danger of revising your ethical standards to fit each new situation as it arises, a practice commonly referred to as “situational ethics.”

An individual who engages in situational ethics is someone who does not possess a fixed standard of right and wrong. Right is simply whatever he perceives to be in his immediate best interest at any given time, which is a fool-proof formula for failure.

That’s why it’s so important to decide on a clear, concise set of moral values when your intellect is in control. Then, in highly emotional situations, you’re more likely to act in accordance with the moral standards that you have decided — in advance — to live by.

Which brings us to the subject of integrity. Integrity is an impressive sounding word, one which people like to bandy about rather carelessly. Unfortunately, very few people really understand what the word means, and even fewer practice it — including, and especially, those who expound on it the most.

Integrity is adherence to your code of moral values. It’s one thing to talk about moral values, but quite another to consistently adhere to them.

The above excerpt is from self development author and entrepreneur Robert Ringer—who writes about ‘concentricity’ which he says is the consistency of one’s words and actions—at his website.

Interventionism: Using Legal Coercion to Get Ahead in Life

Mainstream media (especially in the Philippines) never ceases to inculcate upon her audience of the need to have the "right" morals (mainly based on collectivism) for the political economy to prosper. Yet what they either ignore or omit to explain is how most of the unethical or unscrupulous behaviors have been products of the interventionist policies previously implemented. They also fail to deal with the potential ethical distortions from populist policies they advocate in addressing real time social problems.

At the Epic Times, Austrian economist, Dr. Richard Ebeling explains why this is so (ht: Bob Wenzel) [bold mine]

In an environment in which “public policy” determines individual lives and fortunes and in which social and economic life has become politicized, it is not surprising that many Americans have turned their attention to politics to improve their market position and relative income share. Legalized coercion has become the method by which they get ahead in life.

And make no mistake about it: Every income transfer, every tariff or import quota, every business subsidy, every regulation or prohibition on who may compete or how a product may be produced and marketed, and every restraint on the use and transfer of property is an act of coercion. Political force is interjected into what would otherwise be a system of peaceful and voluntary transactions.

Over time, interventionism blurs the distinction between what is moral and what is not. In ordinary life, most people take for granted that certain forms of conduct are permissible while others are not. These are the Golden Rules we live by. Government’s task in human society is to enforce and protect these rules, which are summarized in two basic principles: Neither force nor fraud shall be practiced in dealings with others; and the rights and property of others must be respected. In the moral order that is the free market economy, these principles are the wellspring of honesty and trust. Without them, America is threatened with ultimate ruin – with a war of all-against-all in the pursuit of plunder.

When individuals began to ask government to do things for them, rather than merely to secure their individual rights and honestly acquired property, they began asking government to violate other’s rights and property for their benefit.

These demands on government have been rationalized by intellectuals and social engineers who have persuaded people that what they wanted but didn’t have was due to the greed, exploitation, and immorality of others. Basic morality and justice has been transcended in the political arena in order to take from the “haves” and give to the “have not’s.” Theft through political means has become the basis of a “higher” morality: “social justice,” which is supposed to remedy the alleged injustices of the free market economy.

But once the market becomes politicized in this manner, morality begins to disintegrate. Increasingly, the only way to survive in society is to resort to the same types of political methods for gain as others are using, or to devise ways to evade the controls and regulations. More and more people, therefore, have been drawn into the arena of political intrigue and manipulation or violation of the law for economic gain. Human relationships and the political process have become increasingly corrupted.

In the 1920s, Ludwig von Mises explained a crucial aspect of this corruption of morality and law:

“By constantly violating criminal laws and moral decrees [people] lose the ability to distinguish between right and wrong, good and bad. The merchant, who began by violating foreign exchange controls, import and export restrictions, price ceilings, etc., easily proceeds to defraud his partners. The decay of business morals . . . is the inevitable concomitant of the regulations imposed on trade.”

Mises was, of course, repeating the lesson that the French classical economist Frederic Bastiat had attempted to teach in the 1850s in his famous essay, “The Law.” When the state becomes the violator of liberty and property rather than its guarantor, it debases respect for all law. People in society develop an increasing disrespect and disregard for what the law demands. They view the law as the agent for immorality in the form of legalized plunder for the benefit of some at the expense of others. And this same disrespect and disregard sooner or later starts to creep into the ordinary dealings between individuals. Society verges on the brink of lawlessness.

Read the rest here

So proposals to implement more interventionist solutions is like a dog chasing their own tail.

Quote of the Day: Why socialism is evil

This is why socialism is evil. It employs evil means, confiscation and intimidation, to accomplish what are often seen as noble goals — namely, helping one’s fellow man. Helping one’s fellow man in need by reaching into one’s own pockets to do so is laudable and praiseworthy. Helping one’s fellow man through coercion and reaching into another’s pockets is evil and worthy of condemnation. Tragically, most teachings, from the church on down, support government use of one person to serve the purposes of another; the advocates cringe from calling it such and prefer to call it charity or duty.

This is from economics professor Walter E. Williams from an article at the LewRockwell.com

Even Santa Claus has lost his freedom

Politics has seeped even into the Santa Claus’ territory.

From Reuters (picture and quote):

A U.S. military website showing Santa Claus delivering his presents while guarded by warplanes has some children's advocates worried.

In a twist to its tradition of tracking an animated version of Santa Claus' sleigh and reindeer as he flies around the globe on December 24, the military is adding the animated fighter plane escort to give a realistic feel to the popular feature, said a spokesman for the North American Aerospace Defense Command.

"We wanted to let folks know that, hey, this is a NORAD video, and we're the military and this is our mission," said the spokesman, Navy Captain Jeff Davis.

The Aha moment:

A video on the NORAD website shows military personnel seemingly preparing for a test flight by Santa, who has the call sign "Big Red One."

"We all know that Santa travels faster than starlight," an officer says in the video, "but this is nothing that our technologies can't handle."

In the eyes of the US government, Santa Claus' actions needs to be regulated. Even Santa Claus has lost his freedom! 

Goes to show how politics has been corrupting on people’s morals.

Quote of the Day: Good Samaritan duty

There is a long tradition in the common law that refuses to recognize a legal duty to help strangers in emergency situations: the so-called Good Samaritan duty. It is not because the common law judges were heartless and did not recognize moral duties. It is because they recognized that state compulsion or legal liability should be used sparingly. They also recognized a whole host of practical problems in enforcing Good Samaritan duties.

Not to recognize a distinction between the moral obligations of individuals and the role of the state is an error of profound consequences.

This is from New York University Associate Professor Mario Rizzo at the comment section of his article on Free Market Moralism, published at the NYU’s Think Markets Blog

Has the Pope’s Resignation Been About Vatican’s Controversies?

Pope Benedict XVI took the Catholic world by surprise by announcing his resignation at the end of the month allegedly "because of advanced age." (CNN)

While it may be true that part of his calling it quits may be due to health, where the Vatican confirmed that Benedict has had a pacemaker for years, which may have been an aggravating factor, pressure from the Vatileaks scandals could have been the trigger (Huffington Post).

The Vatileaks scandal, according the the Huffington Post in 2012, exposed alleged corruption that “cost the Holy See millions of euros (dollars) in higher contract prices”

Further the article added that this revelation “laid bare power struggles inside the Vatican over its efforts to show greater financial transparency and comply with international norms to fight money laundering. There was even a leak of a memo claiming that Benedict would die this year.”

I guess in lieu of death, resignation may have been the outcome. I blogged about this scandal last year.

Add to this other controversies that has plagued Pope Benedict’s reign.

From Reuters

The child abuse scandals hounded most of his papacy. He ordered an official inquiry into abuse in Ireland, which led to the resignation of several bishops…

Benedict confronted his own country's past when he visited the Nazi death camp at Auschwitz. Calling himself "a son of Germany", he prayed and asked why God was silent when 1.5 million victims, most of them Jews, were killed there.

Ratzinger served in the Hitler Youth during World War Two when membership was compulsory. He was never a member of the Nazi party and his family opposed Adolf Hitler's regime.

Of course most of mainstream media has been silent about this.

Yet in support of Occupy Wall Street, the Pope has spoken, if not ranted, against alleged “greed”, which he mistakenly had attributed to laissez faire capitalism. 

Obviously, he had most likely been utterly confused or deliberately misled (by influence peddlers) in associating cronyism or corporatism for free markets. 

And even more bizarre is that the Vatican has even endorsed the ECB’s inflationism! Redistribution from society (or transfer of wealth) to rich bankers and the political class has been by the Vatican as moral??!!

On the other hand, the Pope’s foray into politics by misreading and distorting economics could have been that capitalism served as convenient smokescreen from the internal controversies, wrangling, and power struggles that put pressure on the Pope and the Vatican.

As I previously wrote,

Is it not that the Bible warned that “He that is without sin among you, let him first cast a stone”? (John 8:7)

Does this not apply to the Vatican too?

Whether due to health or political controversies or both, this shows that Pope Benedict is just human, and thus subject to the frailties of humanity as shown whether in health, moral, organizational or even political economic issues.

Quote of the Day: Free Trade is for Common Man, Protectionism is a Rip Off

The cause of free trade has always been about the common man. It is about the right of average people to trade with whomever they want. Protectionism, in contrast, is another way for powerful people to extract money from our pockets and reward their political friends with legal favors. In other words, it’s a rip-off.

 This is from Jeffrey A. Tucker at the Laissez Faire Books

Quote of the Day: On Public Property: Ask Not, How You Can Pursue What Government Tells You is Good

Under the institutions of public property, property is held (the use of things is controlled) by political institutions and that property is used to achieve the ends of those political institutions.  Since the function of politics is to reduce the diversity of of individual ends to a set of “common ends” (the ends of the majority, the dictator, the party in power, or whatever persons or group is in effective control of the political institutions), public property imposes those “common ends” on the individual.  ”Ask not what your country can do for you; ask what you can do for your country.”  Ask not, in other words, how you can pursue what you believe is good, but how you can pursue what government tells you is good.

I am sharing Café Hayek’s Professor Don Boudreaux’s David D. Friedman’s quote from the latter’s book (page 6 of of the 1978 Arlington House edition 1973 book, The Machinery of Freedom)

Bastiat on the Pretentious Moralism of Mercantilism

Mercantilists operate on the dulcet sound bites that hardly stands on economic laws.

The great French classical liberal Frédéric Bastiat does another splendid demolition job on the supposed moral high grounds supposedly assumed by the mercantilists.

In reality free trade, and not protectionism, advances general social cooperation in society or what we may call as civilization.

Quoting Bastiat: [Mises Institute] (bold mine)

Among the arguments we hear adduced in favor of the restrictive regime we must not forget that which is founded on national independence.

"What should we do in case of war," it is said, "if we are placed at the mercy of England for iron and coal?"

English monopolists do not fail to cry out in their turn:

"What would become of Great Britain in case of war if she is dependent on France for provisions?"

One thing is overlooked, which is this: That the kind of dependence that results from exchange, from commercial transactions, is a reciprocal dependence. We cannot be dependent on the foreigner without the foreigner being dependent on us. Now, this is the very essence of society. To break up natural relations is not to place ourselves in a state of independence, but in a state of isolation.

Note this: A nation isolates itself looking forward to the possibility of war; but is not this very act of isolating itself the beginning of war? It renders war more easy, less burdensome, and, it may be, less unpopular. Let countries be permanent markets for each other's produce; let their reciprocal relations be such that they cannot be broken without inflicting on each other the double suffering of privation and a glut of commodities; and they will no longer stand in need of naval armaments, which ruin them, and overgrown armies, which crush them; the peace of the world will not then be compromised by the caprice of a Thiers or of a Palmerston; and war will disappear for want of what supports it, for want of resources, inducements, pretexts, and popular sympathy.

The short of this is that “when goods don’t cross borders armies will”. Promoting economic isolation is equivalent to promoting poverty and war.

So how can the advocacy of war be considered as moral?

Next mercantilists appeal to the emotion of the public, particularly to morality of material abstinence so as to justify political control over people’s economic activities.

Again Bastiat:

I am quite aware that I shall be reproached (it is the fashion of the day) with basing the fraternity of nations on men's personal interest — vile, prosaic self-interest. Better far, it may be thought, that it should have had its basis in charity, in love, even in a little self-abnegation, and that, interfering somewhat with men's material comforts, it should have had the merit of a generous sacrifice.

When shall we be done with these puerile declamations? When will hypocrisy be finally banished from science? When shall we cease to exhibit this nauseous contradiction between our professions and our practice? We hoot at and execrate personal interest; in other words, we denounce what is useful and good (for to say that all men are interested in anything is to say that the thing is good in itself), as if personal interest were not the necessary, eternal, and indestructible mainspring to which Providence has confided human perfectibility. Are we not represented as being all angels of disinterestedness? And does the thought never occur to those who say so that the public begins to see with disgust that this affected language disfigures the pages of those very writers who are most successful in filling their own pockets at the public expense? Oh! Affectation! Affectation! Thou are verily the besetting sin of our times!

What! Because material prosperity and peace are things correlative, because it has pleased God to establish this beautiful harmony in the moral world, am I not to admire, am I not to adore His ordinances, am I not to accept with gratitude laws that make justice the condition of happiness? You desire peace only in so far as it runs counter to material prosperity; and liberty is rejected because it does not impose sacrifices. If abnegation has indeed so many charms for you, why do you fail to practice it in private life? Society will be grateful to you, for someone, at least, will reap the fruit; but to desire to impose it upon mankind as a principle is the very height of absurdity, for the abnegation of all is the sacrifice of all, which is evil erected into a theory.

But, thank heaven, one can write or read many of these declamations without the world ceasing on that account to obey the social motive force, which leads us to shun evil and seek after good, and which, whether they like it or not, we must denominate personal interest.

After all, it is ironic enough to see sentiments of the most sublime self-denial invoked in support of spoliation itself. See to what this boasted disinterestedness tends! These men who are so fantastically delicate as not to desire peace itself, if it is founded on the vile interest of mankind, put their hand into the pockets of others, and especially of the poor.

For what article of the tariff protects the poor? Be pleased, gentlemen, to dispose of what belongs to yourselves as you think proper, but leave us the disposal of the fruit of our own toil, to use it or exchange it as we see best. Declaim on self-sacrifice as much as you choose, it is all very fine and very beautiful, but be at least consistent.

In reality, advocates of mercantilism hardly practice on what they preach. Since mercantilists believes that they have superior knowledge and the moral ascendancy over the rest, they feel that they are exempt from the rules they prefer or opt to impose on their constituency. They believe that if others ought to sacrifice or embrace abstemiousness, they are exempt.

Of course, alternatively, mercantilism is about political inequality and about special economic privileges accorded by the political class to a favored few (the network of friends and relatives and political allies).

In short, the obverse side of mercantilism is crony-state capitalism.

How then can the protection of the few, through political edicts, at the expense of society (where the populace are subjected to coercive restrictions on economic activities) be considered moral? 

Quote of the Day: The False Doctrine of Altruism

Altruism is a code of ethics which hold the welfare of others as the standard of "good", and self-sacrifice as the only moral action. The unstated premise of the doctrine of altruism is that all relationships among men involve sacrifice. This leaves one with the false choice between maliciously exploiting the other person (forcing them to be sacrificed) or being "moral" and offering oneself up as the sacrificial victim.

This is from Jeff Landauer and Joseph Rowland at the ImportanceofPhilosophy.com

Lessons from Bernanke’s Thank You Notes

From the Politico (hat tip Bob Wenzel)

If you have the Federal Reserve’s back, there’s a good chance Ben Bernanke will notice.

He may even send you a thank you note.

In July, the Fed chairman sent letters of gratitude to five Democratic members of Congress after they delivered speeches on the House floor urging fellow lawmakers to reject the “Audit the Fed” bill authored by retiring Texas Republican Ron Paul, the central bank’s chief antagonist.

Their efforts failed to defeat the bill, but they were not in vain, at least in Bernanke’s eyes.

“While the outcome of the vote was not in doubt, your willingness to stand up for the independence of the Federal Reserve is greatly appreciated,” Bernanke wrote in the letters, which were obtained by POLITICO through a Freedom of Information Act request.

He continued, “Independence in monetary policy operations is now the norm for central banks around the world — and it would be a grave mistake were Congress to reverse the protection it provided to the Federal Reserve more than 30 years ago.”

The letters were sent to Reps. Barney Frank, Elijah Cummings, Melvin Watt, Carolyn Maloney and Steny Hoyer.

“It's not unusual for the chairman to write thank you notes to members of Congress,” said Fed spokesman David Skidmore.

Dated July 26, the notes were written the day after the House voted 327-98 to pass Paul’s bill, which would authorize the Government Accountability Office to audit how the central bank implements monetary policy.

While the Fed defends Mr. Bernanke’s thank you notes as having been “not usual”, meaning that such action may have been a tradition, bureaucratic traditionalism does not translate into moralistic actions.

The above simply exhibits how political agents operate behind the scenes to attain self-interested goals. In this case,  Bernanke tries to influence the outcome of votes of the US congress (which he failed). This also implies that such relationship works the other way around for other political du jour issues.

One can construe “conflict of interests” and “agency problems” rather than supposed “independence” from such interactions, as well as, reciprocity and horse trading as part of concession seeking approach employed by political agents from different branches of government.

This also further demystifies the highly glamorized “virtuosity” of governments (myth of good government) as the above account puts into perspective similar human frailties of those in command of the use guns and badge institutions over the populace…except of course the difference is that they can wield political power over society to feed on their caprices.

Quote of the Day: Politics Drives Social Divisions

The pathology of mass democracy translates into ugly social divisions. Great liberal thinkers from Bastiat to Mises have demonstrated that all classes have nothing to fear from one another in a market economy. Freedom of exchange results in the harmonization of interests. Politics, on the other hand, creates fissures that need not exist. Every minor issue becomes blown up into a Manichean struggle. This happens especially over relatively minor issues, because these are the only ones over which the mainstream politicians evince even a rhetorical disagreement. The truly foundational issues of our time—mass confiscation of wealth, IRS despotism, mass imprisonment, militarized policing at home and unending warfare abroad—unite both major parties behind an establishment agenda. They bicker instead over relatively small matters, each one of which becomes amplified into the greatest battle in the history of the world at election time.

This is from Anthony Gregory at the Independent Institute writing on US democracy.

This applies to the social democracy of the Philippines as well. Simply observe the scale of priorities from the way domestic media frames events. Or even the dominant pattern of comments on social media. Trivial matters are frequently moralized and sensationalized which becomes part of the national sports called politics. It’s pop culture that has been little different from the way gossip and slapstick entertainment have been aired on prime time. It’s also about Social Desirability Bias or the need to be seen favorably by others or status signaling. Yet most don’t realize that this obsession for the superficial makes us vulnerable to political manipulation. Politics does foster social divisions

Quote of the Day: To Be Governed

To be GOVERNED is to be kept in sight, inspected, spied upon, directed, law-driven, numbered, enrolled, indoctrinated, preached at, controlled, checked, estimated, valued, censured, commanded, by creatures who have neither the right, nor the wisdom, nor the virtue to do so…

To be GOVERNED is to be at every operation, at every transaction noted, registered, enrolled, taxed, stamped, measured, numbered, assessed, licensed, authorized, admonished, forbidden, reformed, corrected, punished.

It is, under pretext of public utility, and in the name of the general interest, to be placed under contribution, trained, ransomed, exploited, monopolized, extorted, squeezed, mystified, robbed; then, at the slightest resistance, the first word of complaint, to be repressed, fined, despised, harassed, tracked, abused, clubbed, disarmed, choked, imprisoned, judged, condemned, shot, deported, sacrificed, sold, betrayed; and to crown all, mocked, ridiculed, derided, outraged, dishonored.

That is government; that is its justice; that is its morality.

This is from French mutualist philosopher Pierre-Joseph Proudhon in The General Idea of the Revolution in the 19th Century, 1851 p.294

More Brain Drain Canard: When All You Have is a Hammer, Everything is a Nail

The politically colored term “Brain drain” can be seen as an example of what George Orwell labeled as “doublespeak” or language that deliberately disguises, distorts, or reverses the meaning of words.

Here is the Inquirer,

The brain drain has become a bigger problem in the last 12 years, as the yearly exodus of people trained in science and technology (S&T) grew by about two and a half times from 1998 to 2009.

According to a Bureau of Labor and Employment Statistics (BLES) report, the number of S&T workers who opted for overseas jobs rose from 9,877 in 1998 to 24,502 in 2009.

The numbers refer only to new hires or those leaving the country for jobs for the first time.

The BLES cited data from a study titled “International Migration of Science and Technology Manpower-OFWs,” which the Department of Science and Technology’s Science Education Institute (SEI-DOST) published in 2011.

S&T deployment

Results showed that during the 12-year period, S&T deployment grew by an average of 11 percent yearly, peaking at a 59-percent increase in 2001 when 17,756 professionals left, compared with 11,186 the previous year.

Based on the SEI-DOST study, S&T manpower includes physicists, chemists, mathematicians, statisticians, computing professionals, engineers, life science professionals, health professionals (except nurses), and nurses and midwives.

The study found that nurses and midwives represented the biggest group with an average of 9,348 deployed yearly, or 60 percent of the total S&T average of 15,555.

Brain drain is essentially OFWs in different attires.

How can migration be a “problem” when they are representative of individual choices and responses to the current political economic environment?

Have OFWs not been acclaimed as modern day heroes based on mainstream politics?

Whether it is about greener pastures or about career advancement or many other reasons, the point is that OFWs VOTED with their feet. Thus, the actions of science, math and technology graduates, simply reveals of the lack of income, if not career opportunities in the Philippines. These people are simply looking out for their welfare.

Are they not in a better state than becoming unemployed tertiary or college graduates which not only adds to political dependency and the government's fiscal problems but also dehumanizes or demoralizes the individual and their families?

So it is ok to send graduates of different courses or undergraduates, but it isn’t ok to send (S&T) graduates? So the government discriminates or plays favorite with different segments of OFWs? How moral is this?

I have dealt with this bromide lengthily here

Ah but of course, it said that when all you have is a hammer, everything else is a nail. When the government sees a problem they have the typical solution: spend, spend, spend and spend more of other people’s money

From the same article,

When the national budget for 2012 was pending in Congress last year and Malacañang was pushing for a 10-percent increase in allocations for state universities and colleges (SUCS), Budget Secretary Florencio B. Abad said the Executive supports the development of SUCs toward five priority areas that are expected to drive economic growth and employment.

So there you have it.

“Brain drain” has not been a problem when it gives the political authorities free advertisement, as “modern day heroes”, to advance on their political goals.

But “Brain drain” becomes a problem when the government has been itching to spend money other people’s money.

Doublespeak it is.

Filipinos to Join Emerging Market Consortium in the Rescue of the European Political Elite!

Yes you read it right, Filipino taxpayers will be joining Emerging Market contemporaries in transferring resources to European bankers and European politicians, through the IMF, to supposedly “erect a firewall” from an escalating Euro debt crisis.

From Bloomberg,

Emerging-market nations including China and Brazil formalized funding pledges to the International Monetary Fund, helping to almost double its lending power to protect the world economy from Europe’s debt turmoil.

With the addition of new pledges from 12 nations that also includes Russia, India and South Africa, the Washington-based lender said it now has received funding commitments of $456 billion, up from the roughly $430 billion it said it had secured in April. The temporary contributions will add to the $380 billion the IMF currently has available for lending.

“Countries large and small have rallied to our call for action,” IMF Managing Director Christine Lagarde said in a statement on the sidelines of a Group of 20 summit, adding that the new contributions would only be used as “second line of defense” after existing resources are depleted.

G-20 leaders are gathering in the Mexican beach resort of Los Cabos for a two-day summit dominated by the financial crisis in the 17-country euro region just as Spanish borrowing costs soar to a euro-era record. Canada and the U.S. abstained from pitching in for the IMF, despite calls by German Chancellor Angela Merkel for the rest of the world to do more.

“It’s going to be the first time the fund is capitalized without the U.S., which reflects the importance of emerging markets,” Mexican President Felipe Calderon said on June 16.

Pledge Amounts

The meeting’s host said Mexico would contribute $10 billion to the fund, matching pledge amounts made here by Russia, India and Brazil. China said it will provide $43 billion, while South Africa, Colombia, Malaysia, New Zealand and the Philippines were among nations offering smaller amounts.

Where do you think the Philippine government will get the funding to help in the bailout of the European elites? From domestic taxpayers, of course. This includes me.

So the poor (developing nations) will be rescuing the rich (particularly the politicians and the bankers of developed nations). Pope Benedict XVI, are you paying attention?

Emerging market politicians want to swagger about the growing significance of their economies in order to have a greater role in the IMF. But this, by throwing away scarce resources that could be used for local contingencies (e.g. disasters)?

Politicians have been fixated with the present at the expense of the future. What happens if and when another future crisis arrives, especially if such will be a domestic or a regional phenomenon?

This also exhibits that personal status symbols are more the priority for politicians than what they preach as serving the ‘general welfare’.

Also this demonstrates how political agents can thoughtlessly and brazenly fritter away other people’s money.

The European crisis has been transformed into a giant vortex that continues to suck or drain away productive resources out of the global economy.

Since the crisis will likely continue for the simple reason that EU's politicians do not want to deal with its roots, particularly the parasitical relationship of their political economies, and instead look for more hosts to prey upon, then the likelihood is that every nation will get dragged into the financial and economic black hole.

Have a nice day.

Brain Dead Economics: Wars as Economic Stimulus

Marketwatch columnist and former war veteran Paul Farrell is aghast at politicians who are agitating for war in the guise of ‘stimulating the economy’

Mr. Farrell writes, (bold original)

Yes, I’m mad as hell again. I just read some bad news that should make every American mad as hell. In fact, two bad news items.

First, as a U.S. Marine vet, I got angry reading that there have been more military suicides than war deaths the past decade. Yes, more Iraq and Afghan war vets have killed themselves than were killed by America’s enemies in combat. And more are expected as we had more than two million serve in the two wars.

A soldier from the U.S. Army's Charlie Company, 1/12 Infantry, 4th Brigade Combat Team, 4th Infantry Division scans across the border at houses in Pakistan during a Sunday patrol near Dokalam village in Afghanistan's Kunar Province.

Second, if the economic, psychological, political and moral consequences of the past two wars aren’t bad enough, many politicians and candidates — some of whom never served in the armed forces — are proposing that the full Congress pass the Ryan budget and force Pentagon generals to spend billions more than they requested.

Mr. Farrell questions the underlying motives for such calls… (bold italics mine, bold original)

Treating war as an economic stimulus program became clear a decade ago in the early years of the Iraq war. That fact was stressed in a Huffington Post interview with Oliver Stone. Ryan Grim said that in a 2004 meeting President George W. Bush said to the Argentine prime minister: “All the economic growth that the U.S. has had, has been based on the different wars it had waged.”

Apparently that same ideology remains strong in today’s election politics.

Let’s put all this in the larger macroeconomic context. War should be about national defense. Wars should have nothing to do with scoring domestic political points. And yet, increasing the Pentagon budget has become a political hot button in today’s election drama.

This is insane: Do politicians plan to start new wars?

Ask yourself, are they already itching for a new war? After two exhausting wars? Eleven years? We put 2.3 million in Iraq and Afghanistan; 800,000 served multiple deployments, one of the big reasons for vet suicides. So why demand bigger budgets? Why in a time of national austerity? Why when they’re complaining about high taxes?

No, war shouldn’t be about domestic politics, but it is. And that’s bad news for taxpayers, for investors, for America’s values.

Somebody’s got to pay for all this. The taxes of all Americans will go up if the Senate passes the Ryan budget plan, forcing Pentagon generals to spend $554 billion in 2013, billions more than they requested. Plus it’ll add $6.2 trillion new debt and taxes over the next decade.

Yes, this is insane. A few private contractors will get richer but taxpayers will suffer in this zero-sum economics game.

National defense? No, it’s about getting rich, the rest pay the price

America is on a dangerous and costly path. Not just politicians. Americans love war, it’s in our genes. Congress spends over 50% our tax dollars on the Pentagon war machine. America spends 47% of the total military budgets of all nations in the world.

Why does the public tolerates such absurdities? Why do we hide this insanity deep in our collective conscience? Why are we planning new wars? Why do we see war as an economic stimulus program? The Iraq-Afghan “economic stimulus” strategy got us in the mess we’re in; are we really crazy enough to try it again?

Forget all the campaign rhetoric about national defense. That is not why our politicians want to spent trillions more on the Pentagon war machine. Politician are interested in reelection not national defense. They need votes and will keep military bases open because that means local jobs, satisfied voters.

They need campaign cash. Military contractors are great donors. Cutting war-related jobs is political suicide. So they pass big military budgets, waste billions on outdated weapon systems. Keep throwing money at the Pentagon war machine. Anything to get reelected. National defense is not a first priority; their job, their reelection is.

I share Mr. Farell’s revulsion

For me, it’s only politically brain dead people who really argue that destruction (war or natural catastrophes) serves as economic ‘stimulus’.

Post destruction economic activities extrapolates to REPLACEMENT and NOT VALUE ADDED. Yet loss of lives CANNOT be replaced. And deaths along with incapacitated citizens, decreases productivity. This is essentially the Broken Window Fallacy.

And it would be a mistake to relate war with creative destruction. Innovation or advances of technology, which renders obsolete old products or business models, is the outcome of markets in pursuit of consumer satisfaction.

During war, consumers become subordinated to the political forces, particularly through taxes, price controls and rationing, as in World War II.

The point is in war, the economy produces guns, tanks and warplanes and NOT TVs, telephones, private cars. This simply shows how naïve and absurd any such supposed economic comparison is. And this also shows of the dangers of making analysis based on statistical aggregates which tend to discount the real costs, particularly the human factor.

During the World War II, Keynesian economists worried about what would happen to the US economy once the war would culminate.

Then the Keynesian high priest Paul Samuelson quoted by Professor David R. Henderson

When this war comes to an end, more than one out of every two workers will depend directly or indirectly upon military orders. We shall have some 10 million service men to throw on the labor market. [DRH comment: he nailed that number.] We shall have to face a difficult reconversion period during which current goods cannot be produced and layoffs may be great. Nor will the technical necessity for reconversion necessarily generate much investment outlay in the critical period under discussion whatever its later potentialities. The final conclusion to be drawn from our experience at the end of the last war is inescapable--were the war to end suddenly within the next 6 months, were we again planning to wind up our war effort in the greatest haste, to demobilize our armed forces, to liquidate price controls, to shift from astronomical deficits to even the large deficits of the thirties--then there would be ushered in the greatest period of unemployment and industrial dislocation which any economy has ever faced. [italics in original]

Of course, the end of World War II turned out in total contrast to Samuelson’s prediction, the US economy boomed.

Today, brain dead economics turn the table to tells us that the boom that followed World War II had been due to ‘stimulus’. This is a wonderful example of verbal manipulation.

On moral grounds, how is it righteous for people to wish ill for the others? People who really see war as economic growth ought to go to the battlefront, along with their families, and fight the wars themselves. The reason for their chutzpah is because they know someone else will do the dying for them. The same applies to any destruction as stimulus. Talk about pretentious moral high grounds.

Politicians urge for war because war is the health of the state. Aside from the war as the origin the state, wars provide the pretext for the expansion of the state or the “ratchet effect” as coined by Professor Robert Higgs.

Professor Art Carden explains,

In Crisis and Leviathan, Higgs argues that during a crisis a "ratchet effect" produces net increases in government discretion that are not completely reversed after the crisis. Two things happen when government intervenes. First, the bureaucracy naturally tends to expand beyond its stated goals — mission creep. Second, intervention alters incentives; that is, the creation of a bureaucracy to address some problem also spawns a rent-seeking pressure group with interests that will prevent reversion to the status quo ante.

The bottom line is that war as stimulus has never been about economics but about propaganda to expand the power of the state and of the economic interests of those attached to the state or the political clients or the cronies.

For those wishing for war, be reminded of the Golden rule (Matthew 7:12)

Therefore all things whatever you would that men should do to you, do you even so to them: for this is the law and the prophets.

If not they deserve this.

HOT: Charges of Corruption in the Vatican

Even the Vatican has not been spared from charges of corruption and from internal political power struggles.

From the Daily Mail,

Vatican police have arrested Pope Benedict XVI's personal butler following an investigation into the leaking of sensitive church documents, it emerged today.

In a scenes worthy of a Dan Brown thriller, the butler identified as Paolo Gabriele, 46, was held by gendarmes after a special commission of three top senior cardinals had been appointed by a furious Pope Benedict to identify the source of the leaks which have caused severe embarrassment.

Gabriele, who has been at the Pope's side for six years, is one of the German born pontiff's closest members of his inner circle which totals just four lay people and four nuns and he is always at his side - he is so close that he and the nuns who look after him are described as the 'pontiff's family'…

The arrest of Gabriele comes just days after author Gianluigi Nuzzi published a book on the leaked documents called Sua Santita (His Holiness).

The Vatican had condemned the book as 'criminal' and the printing of the documents were a violation of the Pope's privacy it said.

Nuzzi hit back and said that the files were not private and were documents between states and he added they had been given to him by people who work inside the Vatican and in a reference to the Bible, he said the sources wanted to 'get the moneylenders out of the temple'.

Today's arrest came just a month after Pope Benedict turned detective and appointed a special commission to investigate the series of damning and embarrassing leaks of sensitive Catholic Church documents from the Vatican as it still tries to recover from the priest sex abuse scandal.

Dozens of documents including private letters to the Pope have found themselves into the hands of the Italian media in what has been dubbed, unsurprisingly, Vatileaks.

The documents show how contracts were awarded to favoured companies and individuals and also highlight allegations of internal power struggles with the Vatican's bank known as the Institute for Religious Works.

By coincidence on Thursday the head of the bank, Ettore Gotti Tedeschi, who is already under investigation for money laundering resigned after a vote of no confidence and initially there were rumours that he was the person responsible for the leak of documents.

The scandal began in January with the publication of leaked letters from the former deputy governor of the Vatican City archbishop Carlo Maria Vigano, in which he pleaded not to be transferred after he had exposed what he said was corruption over the awarding of contracts.

Earlier the Vatican supported Occupy Wall Street over so-called “corporate greed” and even called for "sweeping reforms".

It had been apparent that the Vatican hardly considered the real political economic conditions (that led to the present juncture) from which impulsive judgment had been passed.

The Vatican hardly realized that they fell for deceptive moral trap laid out by the socialists.

And surprisingly, even the Vatican economist endorsed ECB’s inflationist policies.

I guess with the above report, the idiom “what comes around goes around” applies.

Quote of the Day: Profits are about Consumer Welfare

What if a business does not maximize profits? Then it is either not making the products that consumers want the most, or it is not producing its products at the lowest cost. In either case, consumers are harmed. Any argument against "profit maximization" is an argument against consumer welfare.

Maximizing consumer welfare is the ultimate justification for an economy. Consumers are of course also workers and voters.

That’s from Professor Paul H. Rubin of the Emory University writing at the Wall Street Journal

Politicization of the Entertainment Industry

While I am glad to see that the quality of singing artists seems to have immensely improved from participants around the world including the Philippines, it is sad to see that a recently concluded international popular singing contest seem to have been reduced to a specter of voting for nationalism. Such social signaling has dismayingly been ventilated all over social media.

Yet logic says that if the victor of such singing contest would be determined by such a manner of selection, instead of skills, then the winner would likely hail from the country that has MORE population, all things equal. And I guess that this has been the outcome. [Updated to add: the show's title itself and contestant eligibility rules limits participants to residents of the country where the show is held]

It’s even bleaker to see how political correctness has pervaded the local entertainment industry such that holier than thou groups seek out edicts or legislation through coercive government machinery to attempt to repress on the freedom of religion and of the freedom of speech-expression of the others. Yet such senseless protests over moralism also triggered exasperating traffics.

This just shows how politics has been dumbing down the public and how politics have turned away many people’s attention from productive activities towards unproductive and even confrontational groupthink fallacies or “us against them” mindset.