EXCITING TIMES

        We live in perilous times.  All times are perilous.  We always face dangers and challenges.  We can also find hope if we know where to look.

 Few people see the hopes before they are realized.  The forces of technology and public sentiment build quietly and unnoticed like the forces building up along fault lines.  Few notice until the earth moves.  Few also see forces building for technological and social change.

 On Saturday evening, November 4, 1989, I was at a gathering  in Miami.  A number of Ukrainians sat near by discussing the fate of the Ukraine.  Did anyone there even suspect that in less than a week we would awake to the headline "Berlin wall falls?"  Who foresaw that in a couple of years the Soviet Union would cease to exist and Ukraine would again be an independent nation?

 Forces for monumental change are building today.  Many people see the dangers.  How many see the hope?  People see change as a political process acted out within the political frame work.

 Forces for truly revolutionary changes build outside of, and in spite of, the political order.  They shake and change the political order.  Only force beyond the control of government can change government.

 Government is the most conservative of all institutions.  The foundation of government is force and coercion.  Above all else government seeks to conserve, protect and expand its power.  Those who seek to build peace and prosperity by getting government to reform itself seek the impossible.  The only things that can save us from the plunder and destruction of all powerful government are the irresistible forces from new technology and the will of the people.

 Those forces are building in spite of government's best efforts to stop them.  Government's efforts to prevent change amplify the forces that propel us toward change.

 We live in exciting times.  We are witnessing, mostly unaware, the buildup to what may be the most revolutionary and earth shaking change in history -- more earth shaking than gun powder, the atom bomb, or the fall of the Soviet Union.

 The secret to government power is manipulation and control of the minds of the people.  Those who rule and exploit are few.  Their victims are many.  No government can long survive if the will of the people turns against it.

 All governments must control the minds of their subjects, at least enough to gain passive acceptance.  No where is such control more important than in a democracy where people vote.

 It is no accident that governments world wide control education.  The goal of the rulers isn't to teach the there Rs.  In the name of education, starting in childhood, they indoctrinate the citizens to be compliant and dependent on government.  Dependent victims don't rebel.  Abused voters are as compliant to their abusers as are abused wives to their abusers.

 We have front row seats as world shaking forces build to the climax.  The forces of cyber education threaten the existing order.  In a few years decentralized cyber education will be available and affordable for most children.  The more government and the teachers' unions resist it and make government schools even more of a disaster, the more parents will be driven to private cyber education.

 The movement to decentralized education began in the paper book era decades ago.  It required a great effort to leave the government schools then.  The required effort diminishes today, while government schools grow ever worse.

 Government and the teachers unions will try to outlaw independent cyber education.  They will claim to be protecting the children.  Someone said "Religion is the last refuge of scoundrels."  Actually, “for the children” is the last refuge of scoundrels.

 The move to parental controlled cyber education will build slowly.  Suddenly it will break though.  On a quiet September morn teacher will return to nearly empty classrooms.  The next day's headline will shout "The educational wall has fallen."  People will be freed from government  propaganda and in control of their own minds.

aldmccallum@gmail.com
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Copyright 2013
Albert D. McCallum

What Can Government Do?

     Millions seem to believe government can do anything. 
The flip side is they also believe nothing can be accomplished
without government.  This attitude of dependence on government
grows every day.

     The gold standard for government accomplishment is a
man on the Moon.  Man on the Moon spawned the phrase "If we
can put a man on the Moon, Why can't we _____________?"  
At one time or another that blank has been occupied with about
every unachieved goal known to humans.  Rarely, if ever, have I
heard any of those questions answered.

     First we will consider what the government actually did
in putting a man on the Moon.  Government hired private
businesses to do the heavy lifting.  Government set the goal and
confiscated the resources from the private sector through taxation
and borrowing.

     In other words the private sector put men on the Moon. 
All government did was coerce and bribe the private sector. 
Those businesses that profited from the Moon project
enthusiastically went along.

     Everything comes with a price.  Doing one thing requires
passing up the opportunity to do something else.  Economists
call the lost opportunity the "opportunity cost."

     Going to the Moon had many opportunity costs for many
people.  We will never know what millions gave up to put a
man on the Moon.  We can have some ideas about the nature of
the sacrifice.

     People first spend resources to achieve their most
important goals.  If putting a man on the Moon had been the
most important goal for the people forced to pay for it, those
people would have voluntarily paid to put a man on the Moon. 
The mere fact that people had to be coerced proves that a man
on the Moon was well down their priority list.

     Eventually man would have visited the Moon.  Very
possibly voluntary efforts would not yet have achieved that goal. 
We would have used the lunar resources to have achieved other
things, perhaps cures for some diseases.  For most people going
to the Moon has provided no more benefit than does the home
team winning a ball game.

     The Moon project boils down to one thing, powerful
people in government forced millions to sacrifice their more
important goals to pursue a goal that was important to powerful
people.  That goal wasn't important enough to those powerful
people for them to finance it with their own wealth.

     Nevertheless, government did command the resources that
greatly accelerated man's arrival on the Moon.  Why does
government fail to achieve goals such as ending poverty or
stopping drug use?

     Putting a man on the Moon involved things.  Government
efforts are usually wasteful.  Still, if government can seize
enough resources it can hire the private sector to achieve any
physical thing that is achievable.

     Poverty, education, drug use, and most other problems we
face are matters of human choice and behavior.  When it comes
to achieving positive changes in human behavior, force, coercion
and bribes (the only tools of government) are next to useless. 
Usually force and threats result in people behaving in more
destructive ways

     Government's attempts to change behavior have mainly
created attitudes of victimhood and dependence on government. 
In the process government has forced most of us to sacrifice our
important goals to fund government failure.

     A recent article reported that the money the government
spent on poverty during 2011 was enough to have given every
poor household over $59,000.  Yet most of those households are
still ranked below the poverty line.

     What can we expect in the future?  Nothing but more
government failures and waste denying us the opportunities to
purse our most important goals.  Unless we somehow achieve a
major change in voter attitudes, the toboggan ride to the end will
only accelerate.  The end  won't be on the Moon.

aldmccallum@gmail.com
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Copyright 2013
Albert D. McCallum

What Will the Next Outrage Be?

     Outrageous actions of government are so common they
have lost most of their shock effect.  They are still outrageous,
but expected.  This week brought word of two actions that prove
government can still stretch the envelope.

     Both actions sprang from fertile soil that has germinated
many past outrages.  Both are new, mutant varieties.  One
sprouted in the realm of gunaphobic school administrators.   The
other was the fruit of civil asset forfeiture, the mere existence of
which is an outrage.

     The gunaphobic school administrators suspended a
student and threatened to expel him for one year.  His alleged
offense was playing with some kind of spring powered gun.  It
wasn't clear from the report if the student's actions were dumb
or not.  Apparently the son of the complainant was also
participating in whatever happened.

     The key point isn't what happened, but where it
happened.  The student was still in  his own yard at home.  I
don't know if the school administrator's name was Blomberg. 
Whatever his name, he apparently believes he has the right to
completely control everyone else's life.

     It will be a challenge for someone to stretch that
envelope further.  I don't doubt that some bureaucrat and his
minions will find a way.

     The big push for civil asset forfeiture started in the
1960s.  Prosecutors were upset that drug dealers hired lawyers
who made it more difficult for prosecutors to get convictions. 
The plan was to allow the prosecutors to take all of the alleged
drug dealers money.  Without money, how could the defendant
hire a lawyer?

     This scheme wouldn't work if the defendant had to be
found guilty of something before taking his money.  Civil asset
forfeiture allows the government to allege that the money or
other asset was involved with a crime.  Nothing need be alleged
against the owner of the asset.  The asset need not be proven
guilty.

     The government simply files the allegation and takes the
money.  The burden is then on the owner to try and get his
property back.  The owner, who may be penniless because of the
asset seizure, may be required to post bond before he can even
challenge the forfeiture.

     The headline read "Feds Steal $35K From Small Grocer's
Bank Account Despite Finding 'No Violations' To Justify the
Grab."  Sometimes headlines exaggerate.  This one didn't.

     According to the article from "Reason" the grocer in
Fraser, Michigan made a substantial amount of cash sales.  His
insurance didn't cover losses of cash in excess of $10,000.  The
grocer made many cash deposits to avoid holding large amounts
of cash.  To anyone but the Internal Revenue Service that might
appear to be reasonable and prudent.

     Federal law requires banks to report all cash deposits in
excess of $10,000.  The same law, part of the so-called "Patriot
Act," makes it illegal to structure cash deposits for the purpose
of avoiding $10,000 deposits.  Apparently in the government's
view if you split $10,000 into two deposits, that entitles the
government to take every dollar in your bank account.   If you
didn't have the second $5,000 when you made the first deposit,
tough.  The government still gets your money.

     A few months before taking the grocer's money IRS sent
him a letter saying no violations of banking laws were identified. 
The money had been accused of a crime.  That was enough to
prompt the IRS to punish the money.  Any impact on the  grocer
was merely collateral damage.

     The saga isn't over yet. The Institute for Justice is
representing the grocer.  It has a great track record of stopping
abuses by government.  Even if the grocer gets his $35,000
back, it is likely to cost him or the Institute for Justice more than
$35,000.  That is how government gets away with most of its
outrages.  Fighting back costs more than giving up.  In other
words, government is the biggest extortionist on the loose in the
land.

aldmccallum@gmail.com
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Copyright 2013
Albert D. McCallum

Good and Bad Competition

     I have noticed the term "social Darwinism" popping up in
the news.  Social Darwinists claim that in free competition the
most capable will out produce the less capable causing the less
capable to parish.  The social Darwinists fail to distinguish
between the two types of competition.

     Competition can be either productive or destructive. 
Destructive competition is worse than a zero sum game.  When
competitors destroy the wealth of the other competitors, on
average everyone ends up with less then they started with.

     Total war is the extreme example of destructive
competition.  Any competition to take from others is destructive. 
The victims end up with less.  The "winners" gain less than the
victims lose.  The cost of taking the loot consumes part of the
loot, often most of it.

     The US government welfare system consumes over 70
percent of the wealth taken to aid the poor.  In other words, the
welfare system provides more than twice as much in benefits to
those who run it as it provides to the poor.

     Government is the realm of destructive competition. 
Uncountable special interests use government to destructively
compete for wealth produced by others.

     As this competition increases, it drains effort from
production.  The competitors for what is produced by others
inevitably end up competing for an ever decreasing pool of
wealth.  In the end the weak will inevitably parish.

     Productive competition is a horse of a different color.  In
an environment of liberty, individuals compete to out produce
each other.  Some may try to out produce everyone else.  Others
may compete mainly with themselves.  Primarily they seek to be
more productive than they were.  They don't worry about how
productive others may be.

     The more we produce for others, the more others will
give us in exchange.  This motivates us to compete to increase
what we produce for others.  Yes, this is totally selfish.  Who
should care when everyone benefits?  Failure to recognize how
we all benefit from the selfishness of others often leads
individuals to act against their own best interests.

     Even those who fail to increase their productivity are no
worse off than before.  They may be relatively worse off when
compared to others.  In absolute terns they haven't lost a thing. 
The farmer whose corn production is stuck at 100 bushels per
acre doesn't have less corn merely because another farmer
increases his yield to 150 bushels.

     When the more successful producers invest their
increased productivity in facilities that increase the productivity
of others, those others are better off, rather than worse off. 
Productive competition doesn't drive anyone to extinction.  It can
only aid the survival of all.

     There is another point worth noticing.  When the more
successful producers increase their productivity, they have more
that they can, and often do, donate to aid the less successful
producers.

     For most of history, competition was more destructive
than productive.  A few rulers and slave masters grew wealthy
by forcibly taking from others.  Competing tribes battled to take
from each other.  In this world of destructive, government style
competition, life was cruel, brutish and short.

     The industrial revolution, which still continues, is
powered by productive competition.  Competing to increase our
productivity and service to each other has lifted us to by far the
highest productivity and standard of living in the history of the
human race.  Out producing your neighbor doesn't beggar your
neighbor.  It benefits him.

     The total insanity of social Darwinism is that its
advocates seek to replace the productive competition of free
people with destructive, government based, competition among
special interests.  It is the social Darwinists that have embarked
on a course of action that threatens the survival of the least
successful producers, and everyone else.

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Copyright 2013
Albert D. McCallum

The Right Man

     Imagine that every state in the country has a shortage of
electricity.  The people cry out to Washington, D.C. for more
electricity.  But, D.C. had no electricity.  D.C. wants to help.  It
builds power lines to every state to supply the needed electricity.

     Then D.C. builds a second set of line for the states to
send electricity to D.C.  Electricity flows from the states to D.C.
and back to the states.  Still the people complain that they need
more electricity.

     D.C. builds more lines.  Eventually all the electricity in
the nation flows to D.C. for retransmission back to whence it
came.  As a result every state has less electricity due to the
losses during transmission.  In addition (or, perhaps subtraction)
the people had to pay for building and operating the lines.  D.C.
didn't have any wealth of its own to use to build the lines.

     Still the people complain, some louder than others.  The
states who shout the loudest convince D.C. to send them more
electricity.  D.C. then diverts electricity from the states that
produce it to those who don't.  This pleases the recipients while
only further impoverishing the losers.

     A high paid consultant in D.C. finally comes up with a
miraculous solution.  Only in D.C. would the solution be
considered a solution.  The plan was to make the collection and
distribution so complex and confusing that D.C. could convince
the people that they were all getting back more electricity than
they sent.

     The plan worked.  Even as the lights flicked and went
black across the nation, the people ever demanded more juice
from D.C.   They also refused to even think of the possibility of
taking the D.C. middleman out of the power loop.

     Everyone knew they were totally dependent on D.C. for
electricity.  Without the electricity from D.C. everyone knew
they would starve, and freeze to death in cold, dark basements. 
The determined citizens were sure that incompetence and
corruption on the part of those who operated the system were the
only problems.  Nothing else stood between the people and
Utopia where abundant, free electricity and honey flowed to all.

     A "reformer" cried out to the people in their most
desperate hour.  "There is hope.  We can throw out the nay
saying greedy crooks and bring abundant electricity to all.  Trust
me.  I will change everything for the better."  The people
shouted "Hosanna."

     Only one man raised his voice to question.  "Where will
the electricity come from?  Who will pay for it?"  The people
hated this man.  He wanted to deny them admittance to Utopia. 
A screaming mob poured into the streets surging toward the
home of the evil one who dared to question the plan for Utopia. 
When the sun rose his body dangled from a tree.  No one ever
again raised a voice in opposition.

     The man of hope went to D.C. while the people cheered. 
Soon some noticed something was wrong.  The lights faded even
dimmer.  The people felt betrayed.  A new voice proclaimed,
"The man of hope is a charlatan.  Only I can clean up the mess
in D.C. and make your lights grow bright again."  Once more
the people shouted "Hosanna."

     Alas, the new last, best hope failed to brighten the lights. 
The lights continued to dim.  Still the people never lost their
faith in D.C. and Utopia.  Even as they lay starving and dying in
their cold, dark basements the people still dreamed that before it
was too late the real man of hope would rise up and solve the
problems that prevented wise rulers from opening the doors to
Utopia.

     The people went to their rewards clinging to the belief
that D.C. could have saved them, if only the right man had
arrived in time.

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Copyright 2013
Albert D. McCallum

Where Does Butter Come From?

     I found a quart of heavy whipping cream in the
refrigerator.  It had expired over a month ago.  My wife
pondered what to do with a quart of sour cream.  I wonder how
many people would simply throw it out.

     I said "Why not make butter?"  How many people have
ever seen butter made the old-fashioned way?  When I was a
young boy I watched Grandma make butter.  Sometimes I helped
by pumping the dasher in the churn.

     My grandparents had a small farm.  As was common in
the area, the farm included a small dairy heard.  By today's
standards the heard was infinitely small, five to eight cows.

     The cows would freshen (for city slickers that means they
had calves and started giving milk) in February or March. 
Caves have to eat.  My grandparents didn't want to use up whole
milk feeding calves.

     At each milking Grandma saved out a couple of quarts of
milk in a pan for each calf.  The pans set on the pantry shelf for
a couple of days.  The cream came to the top.  Before feeding
the calves Grandma skimmed the cream from the top of the
pans.

     The calves got skimmed milk mixed with a powder
supplement called "Calf Manna."  The cream went into a crock. 
Twice a week Grandma churned the then sour cream into butter.

     The churn was a crock five gallons or so in size.  It had
a wooden cover with a round hole in the top for the dasher
handle.  The handle had a wooden X on the bottom.  Pumping
the handle up and down stirred the cream causing the butter to
float to the top.  Pumping the churn was fun, for a while. 
Sometimes the butter took at least forever to separate.  Adding
some cold water to the cream aided the separation.

     After the butter floated to the top, Grandma skimmed it
off and put it in a wooden butter bowl about a foot and a half in
diameter.  She then added cold water and used a wooden butter
paddle to work the water through the butter.  This washed the
butter milk out of the butter.  The final step in the bowl was
adding coloring, if needed, and salt.

     Grandma then formed the butter into one pound bricks
with her butter mold. It was a wooden box just the right size to
hold a pound of butter.  It had a plunger in the top to push out
the brick of butter.

     The natural color of butter is anything from orange to
white.  The color of the butter also depends on the color of the
cow.  Different breeds of cows produce different colors of butter. 
When the cows were on green grass in the spring, the butter was
very yellow to orange.  In the dry summer the butter was nearly
white.

     Armed with all this knowledge I was ready to make
butter.  I didn't have a churn handy.  A mere quart of cream
would have gotten lost in a churn anyway.  My wife set up her
mixer and put the aged cream in the bowl.  I put the mixer on
low and let it rip.

     A few minutes later a thick scum was forming on the top
of the bowl.  I stopped the mixer.  The final separation required
a gentler agitation.  I worked it with a spoon.  Soon the butter
was separated.  I skimmed it into a bowl and worked cold
water through it a couple of  times to rinse out the buttermilk.

     I had over a half pound of very pail yellow butter. 
Disregarding the half hour or so I invested in "Project Butter,"
that beats pouring the cream down the drain.

     The survivalists who are planning to survive the collapse
of civilization might want to add this column to their scrap
books.

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Copyright 2013
Albert D. McCallum

How Much Should the Rich Give to the Poor?

     Last time we plunged into the consideration of inequality. 
We saw that it is impossible to measure and compare the real
wealth of one person to that of another.  Real wealth is
measured by use value, not market value.  Use value isn't
measurable.  We also saw that individuals' real wealth, their
satisfaction, is often increased by tangible wealth that belongs to
others.

     Suppose that a wealthy person invests $50 million in a
factory.  The workers at the factory earn 20 percent more than at
their old jobs.  Those who build the factory and those who
supply the factory and distribute its products also gain increased
income.  The factory owner has used his wealth in a way that
clearly increases the tangible wealth of others.

     We can reasonably assume that many of these others also
enjoy increased satisfaction.  Why would they work for the
factory if they didn't find it more satisfying than their next best
option?

     Suppose instead of building the factory the wealthy
person gave the $50 million to the poor?  In the short term the
poor would have increased tangible wealth.  Very possibly this
wealth would contribute to increased satisfaction.

     When poor people gain wealth, they spend most of it.  As
a result of the gifts, society as a whole ends up with less
investment.  This means lower production and lower average
incomes in the future.

     Are the benefits from the immediate satisfaction gained
by the poor worth more than the cost of satisfaction lost in the
future?  Satisfaction being unmeasurable, this question cannot be
answered.

     One thing is certain.  If all saved wealth was given to the
poor (either voluntarily or through government force) and
consumed, all investment would soon be consumed.  Eventually
there would be no factories, equipment or tools for workers to
use to increase their productivity.

     The few people who survived would be barehanded
hunter-gatherers attempting to live off what nature produced. 
The result would be nearly equal poverty at a level well below
what most poor people enjoy today.   I doubt that many people
would consider this stride toward material equality a good idea.

     Even then the survivors would not "enjoy" true equality. 
Some places the bounty of nature is greater than others.  Some
individuals would be better at living off nature than others.  Not
everyone would have equal abilities to hunt and gather.

     If the wealthy reduce their consumption and give to the
poor, long term productivity will not be hampered.  It is most
unrealistic to assume that all, or even most, charity by the
wealthy will be cut out of their consumption rather than their
investment.

     Thus, charity inevitably decreases future production and
the capacity for charity in the future, unless the charity increases
the productivity of the recipients.  If the poor simply consume
the gifts, the capacity for future gifts will be reduced below what
it could have been.

     We won't slip into the economic death spiral until we
reach the point that charity decreases net investment.  A smaller
increase in net investment will still provide for increased, or at
least sustained, production.  The one certain thing is that
committing charity that reduces net investment will eventually be
an unmitigated disaster for everyone.  Such charity is the
equivalent of giving away and eating the seed corn.  In the long
run, even the poor will benefit more from investment than from
gifts.

     I can't even suggest an ideal level of charity.  Setting an
ideal level of charity involves value judgments that will very
from individual to individual.  It would also require more
knowledge about the future than any, or all, of us can possibly
have.

     The only promising option is to leave the choices about
charity up to each individual.  When we did this in the past the
results were far better than most people realize.  With the
increased wealth produced today, there is every reason to expect
the results would be even better.

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Copyright 2013
Albert D. McCallum