Have you heard the one about Big Government and the Gold Standard?

(Proof that even dull 'blogs can inspire interesting questions:)

Ron Paul has popularized it of late, but it is an opinion long current among downmarket libertarians, that going off the gold standard enabled the Federal government to grow to its current size and that going back on the gold standard is a sensible route to decreasing the size and scope of government.

There may even be a kernel of truth to it: going off the gold standard meant that the US as a nation could run up a current account defecit without provoking an attack on the dollar, doing away with Triffin's Dilemma, carrying with it two side effects, the first being that private business was free to import according to market prices, without a need for quotas in order to prevent a major depression, and that the government, too, was free to spend more on foreign aid and defense. The balance of payments was no longer a make-or-break issue; the dollar's peg to gold, which to a modern eye looks artificial and superstitious, no longer unnecessarily complicated everyday economic activity.

That isn't what vulgar libertarians have in mind, though, when they denounce the Federal Reserve and call for a return to a gold standard. Triffin's Dilemma is also resolved when the US Dollar is no longer the base currency for the rest of the world, but massive government interference in the marketplace, in the form of export subsidies, high tariffs, and import quotas, would nonetheless be necessary to prevent an attack on the dollar, deflationary spiral, and depression. I doubt that even Ron Paul would give up free trade to get gold.

The argument instead is that the "government can and does Just Print Money to finance Wars, Welfare, and All That." Translating crass ignorance of the money creation process out of that statement, the libertarian gold bugs' allegation is that the Federal Reserve is a major enabler of defecit spending.

Is that so? The numbers don't bear the story out. As of the seventh of January, 2008, according to the Treasury Dept's Bureau of Public Debt, the total US public debt was $9,199,557,987,743.58, of which $4,083,366,539,555.28 is intragovernmental (owed by the government to itself: think "Social Security Trust Fund") and $5,116,191,448,188.30 is held by the public, including by the Federal Reserve. The Federal Reserve, as of October 2007 held $775,000,000,000 of the public debt. That amounts to roughly 8% of the total, or 15% of the portion held by the public.

The Federal Reserve thus enables about eight percent of Federal defecit spending. Is taking a purchaser of eight percent of the debt out of the picture really worth going back to the days when imports and exports were a political issue, or worse still, to the era of Great Depressions and even greater Panics of 1873, of cyclical depressions and deflationary spirals?

Mitt Romney: None too bright

Campagins for both major parties' Presidential nomination tend always to feature a race to the bottom. The Democrats' is a perennial pandering to labor unions--especially government-employee rent-seeker unions--and other class warriors. The Republicans' is variable but equally tawdry, with two recent topics being "family values" and gay marriage.

This time around the race is to see who can best stick it to illegal aliens, the approximately twelve million American residents here without proper visas, usually breaking the law because the government, distinguishing between skilled and unskilled labor as though we're still in the Economic Stone Age, offers no means to comply.

This race has come with its own code-words and jargon, most of it euphemisms crafted to make peaceful activity sound nefarious: "Anchor babies", "stealing jobs", "our culture", etc. Ron Paul, although he's stayed out of the macho jingoist pissing contest, is not above these in general. On his website he frames amnesty as a "reward for breaking our laws," as though letting someone who is in violation of the law off the hook is the same as giving him a C-note.

Mitt Romney makes this look positively intelligent by portraying amnesty as a proposed solution to the problem. This is either a revelation of idiocy or an insult to the voters' intelligence: the questions of what to do about our obviously flawed immigration policy and whether to give 12 million illegal aliens amnesty (as opposed to rounding them up and deporting them) are separate. Nobody is proposing that by simply regularizing those already here, we will stop the flow.

I'm guessing that thousands of people who'd never let Joe Biden wave his hands and equate union members and the middle class are willingly hoodwinked by the hayseed fallacies of Romney and Paul. If politics were done like academic science, with open minds and respect for reason instead of appeals to the voters' often twisted ideas of reality, we'd be in better shape. Unfortunately we must deal with people as they are and not as we think they ought to be, however, what ever happened to the notion of leadership? We ought to be able to expect Paul and Romney to be above the rubes, not be one with them!

The Libertarian Meme Pool

My fiancée and I recently attended an appearance of one of the lawyers representing Guantanamo detainees, an enlightening and altogether worthwhile use of an hour on a Sunday. As is usual, it was followed by what was nominally a question-and-answer session that, we noted, turned out to be more of a statement-and-answer session. I had thought that this discourtesy was reserved to the younger generation, but most of the audience had at least 40 years on us and ranted nonetheless. Aside from my dirty looks and question pre-screening, there should be some way to keep people from taking advantage of the captive audience to say something; I came to hear the speaker, not someone off the street who doesn't have more to offer than the average Joe and can't bother to even organize his thoughts!

Radio callers, too, are tending toward this behavior. Case in point: a caller about 38 minutes into Bryan Caplan's recent appearance on Wisconsin Public Radio decided it OK to give a shout-out for Ron Paul and tell the George Mason economist (and, thanks to his book, rockstar-du-jour), that "central planning doesn't work."

Caplan, of course, isn't advocating economic central planning or even an ironic iron-fisted rule by free-marketeers. Maybe Libertarianism Makes You Stupid: pop libertarianism, of the type that has influenced the nonlibertarian Paul, loads its adherents up with clichés, this one being especially popular. Dick Clark recently replied to a message of mine suggesting he and others would be better served by thinking about the question of animal rights than merely declaring, cart before the horse, that because animals are property no moral imperatives apply, with a request to not "think like a central planner", inadvertently putting me in the same camp as Caplan! I'm flattered.

When in doubt, throw out a cliché. Central planning doesn't work! You own yourself! A is A! All rights are property rights! It's sure to make you feel really good, and give those of us whose thought processes don't consist of re-arranging our bumper stickers a headache. Mix it with the use of a Q and A session as a bully pulpit, and it becomes a migraine!

Kubby out of the LP race.

Due to factors ranging from low registration, to the perception (perhaps usually correct) of holding fringe values and endorsing nutty policy schemes, to the widespread (fallacious) belief in the "wasted vote", the Libertarian Party's Presidential candidate is usually a nonstarter, to the point that, for example, nobody in the press even bothered to show just how nutty sham "Constitution Scholar" Michael Badnarik was. That he was in the race was barely newsworthy, and then usually as human-interest journalism; the details didn't matter.

Despite taking the same approach to Constitutional scholarship that Ayn Rand took toward serious philosophy, Badnarik had many positive qualities: that he was a bona fide libertarian was not in question, and, moreover, he had a gentlemanly sense of propriety. When asked why he's in the race if he can't win, his reply was usually to the effect of: "The one way I can win is for you, your family, your friends, and millions of others to vote for me." Surely, his chances were slim, but he was doing what the LP should expect from a candidate: campaigning full-time and in earnest.

All but one of the Presidential candidates, from any party, will lose, but the running is not wholly vain. Having the press's ear (more so if they are serious contenders, but even if they are third-party dark-horses), they--as Ron Paul is doing regarding the War--determine, to some extent, what the issues of the day are, and where the Overton Window lies on the space of political possibilities. They also help bring attention to a party's local candidates and serve as their party's de facto spokesman for the duration of the campaign. This is especially true in the case of minor parties, nearly invariably unfamiliar to the majority of citizens.

To do these things is the duty of any Presidential candidate. (Many libertarians, especially of the big-ell LP variety, would argue that there is no "duty" other than that specified in a written contract. Perhaps that's one of the reasons they haven't gained much traction.) It would be improper for a candidate to refuse to campaign, or to unilaterally express support for another party's candidate for the same office!

Steve Kubby has done just that, in endorsing the candidacy of paleoconservative Republican Ron Paul.

Ron Paul was once the Libertarian Party's Presidential candidate, and he may even have once been a libertarian, but it seems that, at least of late, he takes a different approach to the issues, one which leaves him with about as much overlap with libertarians as Tom Coburn. Hatred of government is not synonymous with love of liberty.

Kubby's intent, as expressed to Paulie Cannoli is to support Paul, and encourage other Libertarians to do the same, and to, if Paul doesn't receive the nomination, to run a strong Libertarian campaign in 2008. The trouble there is threefold:

1. The Libertarians hold their nominating convention in late May; the Republicans won't have theirs until early September. Suppose, since the whole field is lackluster, Paul becomes one of the frontrunners. Will Kubby not campaign--or campaign for Paul--until then? If Paul gains strength, nominating Kubby means running a weak campaign, even by Libertarian standards.
   
2. Encouraging Libertarians to support Paul means, in many states, encouraging them to re-register and vote in the Republican primaries, endangering ballot access for local and state-level candidates.
   
3. Encouraging Libertarians to support Paul means diverting resources from libertarian causes and candidates.
   

Even if Ron Paul radiated liberal values, Kubby's endorsement, as he put it, is a statement that he will not upohld his duty to support the Party. If Paul were to receive the Republican nomination, the extent to which he, and not a Libertarian candidate, should receive the support of libertarians, is most properly determined by that contituency. Nominating Kubby would be a waving of the white flag to the paleoconservatives, a repudiation of the idea that libertarians should do what they can to move policy in their direction, even if just by making major-party candidates fight the "spoiler effect". Pledging to shirk his duty to support Libertarians down the ticket means he's no longer worthy of Libertarians' support.

It's easy to be an Internet gadfly:

Just write something spontaneously for someone else's website and hope for the best.

It's what I did, making the case for a Paul-Giuliani policy debate over at Rational Review.

Giuliani's Pyrrhic victory

I'm no Ron Paul fan. He's a conspiracist crank, an economic Austrian, the most ineffectual multi-term Congressman in recent memory, and perhaps a racist, too. Add to that his supporters' obnoxious tendency to infer victory from stuffed Internet polls, and we have a man who this dyed-in-the-wool, Nozick-reading, third-party-voting, ACLU card-carrying classical liberal considers more of a shame than a credit to his end of the political spectrum.

But reports that he handed victory in the second "debate" among the contenders for the Republican nomination for President to Rudy Giuliani are premature. Giuliani may have gotten the best possible knee-jerk response, but on reflection he's being taken more and more for, well, an idiot, an empty-headed reactionary.

Credit goes to Paul for staying on message, for stuffing the nuttery in the closet, and for making it obvious to us all that having been Mayor of New York City on 11 Sept 2001 is no substitute for having read the 9/11 commission report. And the credit is coming in. CNN commentator and former Chicago Defender editor Roland Martin took it on himself to flesh out Paul's argument and nail Giuliani with a haymaker. To quote: "First, Giuliani must be an idiot to not have heard Paul's rationale before. That issue has been raised countless times in the last six years by any number of experts."

Now Pat Buchanan has entered the fray, too, taking the Republican Party to task over rejecting Paul's message. Republican dissent is now in the open and mainstream. Thanks to Paul, the problem can't be ignored, and Rudy for his part made it clear just how stupid the hawks' reasoning has been.

Worst case: The Republicans lose because of this and we end up with a social-democratic disaster under Obama or Edwards.

Mediocre case: The Republicans nominate a "moderate" and beat the Democrats, giving us gridlock and maybe some domestic policy reform.

Best case: The Republican mix gets shaken up, with America's favorite authoritarian and seething hawk McCain off the table as well as Giuliani. Romney gets some book learnin' about the conflict. The Democrats get fed up with slogans and waffling and push the knowledgeable and nuanced Bill Richardson to the fore. We end up with two acceptable choices plus perhaps a reasonable, respectable Libertarian for a change.

A man can dream, right? It's clear that Giuliani opened Pandora's box. What's inside remains to be seen.