Lawson for Congress

My sister asked a great question on my Facebook wall:

Ummm, BJ- I read H.R. 1955 and couldn’t find anything about throwing people in jail for comments on Facebook- am I missing something?

The first problem with H.R. 1955 is the name: “Violent Radicalization and Homegrown Terrorism Prevention Act of 2007″. As everyone knows, most legislation is named to obscure its unintended, yet inevitable, consequences. Take HIPAA for example — the Health Insurance Portability and Accountability Act is widely believed to ensure privacy of your medical records, although privacy isn’t even in the name. The effect of HIPAA, however, is to ensure that your all your medical information is easily available to anyone involved in the “process of care”, or with any financial interest in your health. So much for privacy of your medical records.

But when you dig into H.R. 1955, you might start asking questions at the Definitions:

`SEC. 899A. DEFINITIONS.

`For purposes of this subtitle:

`(1) COMMISSION- The term `Commission’ means the National Commission on the Prevention of Violent Radicalization and Homegrown Terrorism established under section 899C.

`(2) VIOLENT RADICALIZATION- The term `violent radicalization’ means the process of adopting or promoting an extremist belief system for the purpose of facilitating ideologically based violence to advance political, religious, or social change.

`(3) HOMEGROWN TERRORISM- The term `homegrown terrorism’ means the use, planned use, or threatened use, of force or violence by a group or individual born, raised, or based and operating primarily within the United States or any possession of the United States to intimidate or coerce the United States government, the civilian population of the United States, or any segment thereof, in furtherance of political or social objectives.

`(4) IDEOLOGICALLY BASED VIOLENCE- The term `ideologically based violence’ means the use, planned use, or threatened use of force or violence by a group or individual to promote the group or individual’s political, religious, or social beliefs.

Here are some questions:

• Why is it necessary to define Homegrown Terrorism, or Ideologically Based Violence, based upon a person’s thoughts or beliefs? Why are current criminal laws insufficient?
• What defines “extremist” belief? Was Rosa Parks “extremist” when she thought she deserved a seat at the front of the bus?
• Why does “ideologically based violence” include “planned use” or “threatened use” of “force or violence”, in addition to “use”?
• Can “use” of violence really be equivalent to the “planned” or “threatened” use of violence, and who defines what is a “plan” or a “threat”?

Then you read through the bill, and discover that on the surface it seems to be a typical pork-fest that spends money that we don’t have (but will happily borrow or print) to create a National Commission and a university-based Center of Excellence that will explore these issues in great detail with new federal employees, consultants, and travel expenses.

But here’s the punch line:

`SEC. 899E. PREVENTING VIOLENT RADICALIZATION AND HOMEGROWN TERRORISM THROUGH INTERNATIONAL COOPERATIVE EFFORTS.

`(a) International Effort- The Secretary shall, in cooperation with the Department of State, the Attorney General, and other Federal Government entities, as appropriate, conduct a survey of methodologies implemented by foreign nations to prevent violent radicalization and homegrown terrorism in their respective nations.

`(1) a brief description of the foreign partners participating in the survey; and

`(2) a description of lessons learned from the results of the survey and recommendations implemented through this international outreach.

`(b) Implementation- To the extent that methodologies are permissible under the Constitution, the Secretary shall use the results of the survey as an aid in developing, in consultation with the Attorney General, a national policy in the United States on addressing radicalization and homegrown terrorism.

OK, there are some teeth. Now we’ll have a national “policy”. Excellent. But should I be concerned that one of the Findings says, “The Internet has aided in facilitating violent radicalization, ideologically based violence, and the homegrown terrorism process in the United States by providing access to broad and constant streams of terrorist-related propaganda to United States citizens”? Since we’re going into the policymaking process with that Finding, might we be justified in censoring the Internet? Why are citizens not empowered to educate and defend themselves with broad access to such terrorist-related propaganda? Isn’t knowledge power?

But don’t worry. We’ll respect civil rights and civil liberties:

SEC. 899F. PROTECTING CIVIL RIGHTS AND CIVIL LIBERTIES WHILE PREVENTING IDEOLOGICALLY BASED VIOLENCE AND HOMEGROWN TERRORISM.

`(a) In General- The Department of Homeland Security’s efforts to prevent ideologically based violence and homegrown terrorism as described herein shall not violate the constitutional rights, civil rights, or civil liberties of United States citizens or lawful permanent residents.

`(b) Commitment to Racial Neutrality- The Secretary shall ensure that the activities and operations of the entities created by this subtitle are in compliance with the Department of Homeland Security’s commitment to racial neutrality.

`(c) Auditing Mechanism- The Civil Rights and Civil Liberties Officer of the Department of Homeland Security shall develop and implement an auditing mechanism to ensure that compliance with this subtitle does not violate the constitutional rights, civil rights, or civil liberties of any racial, ethnic, or religious group, and shall include the results of audits under such mechanism in its annual report to Congress required under section 705.’.

The danger with this thought process is that by stating civil rights and civil liberties will be “protected”, we are put in the Orwellian position of redefining civil rights and civil liberties based upon whatever happens to spit out of Magical Policy Machine. Obviously, since the legislation requires that civil rights and liberties be protected, the resulting policy must have taken those concerns into consideration, right?

So, in answer to my sister’s question:

… in other words, the actual data-mining of comments on Facebook to throw people in jail isn’t in the legislation. That would be too over the top. Instead, Congress gives the policymaking committee power to write its own rules by saying “the Secretary shall use the results of the survey as an aid in developing, in consultation with the Attorney General, a national policy in the United States on addressing radicalization and homegrown terrorism”.

This very idea of Congress giving an unaccountable federal committee carte blanche to define a national policy for “addressing radicalization and homegrown terrorism“ is a slap in the face to our Constitutional Republic, the criminal justice system, and an insult to the soldiers and citizens who have fought for freedom throughout our history.

Does any of this sound in the least familiar? Any echoes from the past? Check out the Alien and Sedition Acts of 1798 — Thomas Jefferson would not be happy with us right now. What happened to free people in a free country with the rule of law, due process, and existing criminal laws against destruction of life, liberty, and property?

This act has already passed the House, with the support of my opponent Rep. David Price. Vote out irresponsible incumbents, and help stop this bill in the Senate as S. 1959. Freedom isn’t free — call and write your senators today.

… his name is Ben Bernanke.

Headline from CNBC:

Credit Watch: Fed to Pump More Funds Into Markets

The U.S. Federal Reserve and European Central Bank announced plans to pump more funds into troubled money markets to give banks enough cash to get them through a year-end squeeze.

Persistent concerns about banks’ year-end funding drove up interbank rates and the Fed said it would put enough funds into the money markets into the new year to resist upward pressures on its benchmark interest rate, the fed funds rate.

Seriously, folks, this story is not news. Failure of the Fed to “pump more funds” into money markets to manage the fed funds rate would be news. You see, the Fed has two choices:

1. “Inject liquidity” (i.e., create money) as needed to ensure banks are willing to lend to each other; or
2. Allow the banking system to seize up, cutting off credit to businesses, and potentially collapsing the entire system

In other words, “inflate or die.” Option (2) isn’t really an option, is it? So we just thank the Fed for their service, and accept the fact that new money into the system keeps things afloat for the time being.

But how is this situation a bad thing? Is this new money creation really an inflationary force, since it’s being done to offset the deflationary force of collapsing assets based upon troubled mortgages? Couldn’t the Fed get it right, and balance the deflation of the collapsing CDO valuations with the “right” amount of new money to keep rates and confidence at the appropriate levels?

In other words, what is REALLY going to happen? Are we going to see deflation (where money becomes more valuable, and most asset prices go down), since the collapsing CDO valuations haven’t begun to really gather steam yet? Are we going to see overall price stability, because the Fed will perfectly offset the CDO valuation declines with the “right” amount of “new money”? Are we going to see inflation, because the Fed’s incessant creation of new money to keep banks willing to lend will just further inflate a system that was already overwhelmed with liquidity?

These are overly simplistic questions, but they are at the heart of what many people are asking as they try to determine where to park their savings and investments during this turbulent time. If you expect deflation, you should be weighted towards cash. If you expect stability, you need to read more history. If you expect inflation, you should be weighted towards commodities and hard assets.

The trouble with expecting deflation in this scenario is that we are resuscitating this collapsing debt bubble in the midst of a $9.1 trillion (and growing) national debt and current account deficit of over $800 billion. You can’t just look at what is happening within the banking industry, you must also consider what is happening in our government, and between our country and our trading partners around the world. Just to keep the lights on in Washington, we have to borrow and print an additional $1-3 billion per day. That doesn’t seem like much, but eventually it adds up — to the point we’re adding to our national debt by about $600 billion per year.

Bottom line is that we’re creating an awful lot of new money, for a whole bunch of reasons. That’s a highly quantitative analysis, but the market’s verdict is pretty clear: our currency continues to decline on international markets, gold continues to hold above $800 per ounce, oil is over $90 per barrel, and my family’s grocery bill is way up assuming we try and maintain a constant standard of living. Objectively, that says we’re in an inflationary environment.

On the bright side, our currency is a fine medium of exchange — lots of people accept it as payment for lots of useful things. But when our fiat currency was born in 1971, price levels were about five times less than what they are today based upon the Bureau of Labor Statistics’ inflation calculator. So over the long term, it is an extremely poor store of value.

Santa, paper is for wrapping.

There’s no question our healthcare system is a study in contrasts. On one hand, we lead the world in diagnostic and therapeutic research. On the other hand, healthcare is now an industry dominated by warring bureaucracies — both corporate and governmental. As providers fight to bill as much as possible, and payers fight to pay as little as possible, the doctor-patient (or more generally provider-patient) relationship is becoming a curious historical relic.

I ran across a document some time ago that captures our healthcare system’s problems with amazing clarity. Written in the style of the Declaration of Independence, it accurately reports the history of our government intervention in healthcare, and the resulting unintended consequences:

1601 N. Tucson Blvd. Suite 9 Tucson, AZ 85716-3450 Phone: (800) 635-1196 Hotline: (800) 419-4777 Association of American Physicians and Surgeons, Inc. A Voice for Private Physicians Since 1943 Omnia pro aegroto The Physicians’ Declaration of Independence July 4, 2004 When in the Course of human events, it becomes necessary for one Profession to dissolve the Financial Arrangements which have connected them with Medicare, Medicaid, assorted Health Maintenance Organizations, and diverse Third Party Payers and to assume among the other Professions of the Earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of Mankind requires that they should declare the causes which impel them to the separation. We hold these truths to be self-evident: that the Physician’s primary responsibility is toward the Patient; that to assure the sanctity of this relationship, payment for service should be decided between Physician and Patient, and that, as in all transactions in a free society, this payment be mutually agreeable. Only such a Financial Arrangement will guarantee the highest level of Commitment and Service of the Physician to the Patient, restrain Outside Influence on Decision-Making, and assure that all information be kept strictly confidential. When a Third Party dictates payment for the Physician’s service, it exercises effective control over the Decision-Making of the Physician, which may not always be in the best interest of the Patient. The Third Party then intrudes heavily into the sacred Patient-Physician relationship and demands to inspect the Medical Record in a self-serving attempt to satisfy itself that its money is being spent in accordance with its own pre-ordained accounting principles. The Financial Arrangements between Physicians and the Third Parties have become so destructive to the Patient-Physician relationship, and to the Medical Profession as a whole, that it is the Right, and Obligation, of the Members of the Profession to abolish them. Prudence will dictate that arrangements long established should not be changed for light and transient causes; and accordingly all experience has shown, that Physicians are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations evinces a design to reduce them under absolute Despotism, it is their Right; it is their Duty, to throw off such arrangements, and to provide new Guards for their future security. Such has been the patient sufferance of this Profession; and such is now the necessity that constrains them to alter their former Financial Arrangements. The history of the present system is a history of repeated injuries and usurpations, all having in direct effect the establishment of an absolute Tyranny over the Medical Profession. To prove this, let Facts be submitted to a candid world. Controls, were forced to lure workers by offering Health Insurance Benefits. This benefit, in lieu of cash, received favorable tax treatment and was allowed to continue after the War, even with the removal of the Wage and Price Controls. This system created a strong incentive to use Health Care and set the stage for massive Health Care Cost Inflation. Slowly, insurance changed into payment for all Health Expenses, minus a small and shrinking deductible, which led to further Inflation, and a call to control costs. The Government decreed that Employers must offer Employees the option of a Health Maintenance Organization. Thus were born the HMOs: Private Insurance Entities designed to ration Health Care for their Members. These Organizations received Tax-favored treatment that allowed them to survive in spite of their horrendously flawed concept. The Government, in 1965, in its Infinite Wisdom, decreed that the Poor and The Elderly should receive Health Care Benefits funded entirely by the Taxpayer. Thus came into existence Medicaid and Medicare. Medicaid, from the Conception, paid Physicians such a lowly wage that few participated, thereby creating a Two-Tiered System. Medicare payments to Physicians were initially fair and reasonable, and many Physicians participated in Medicare. Both Systems flooded the Health Care Marketplace with Money, which fueled Inflation even more. Alarmed by the Health Care Cost Inflation that it had engendered, the Government set out to restrain costs, principally by limiting fees to Physicians. These Price Controls had the effect of increasing Health Care Inflation, as Volume of Services went up, and Quality went down. With each new round of Controls, Regulations and Paperwork multiplied many fold. This caused Physicians great Anguish, and took more time away from the Patients, with attendant loss of Quality and increase in Health Care Inflation. Government policies continued to favor the HMO, which were turned to in the hope they would tame Inflation. These Organizations simply skimmed Money off the Premiums as Profit, but which they called “Savings.” They spent less on Health Care by denying or limiting access to Specialists, Procedures, Hospitals, and High Technology. Since this strategy mostly delayed care, it was ultimately more expensive. Thus did the Premiums again start to rise. The HMOs paid the Physician by Capitation; Physicians could stay profitable by having large numbers of Capitated Patients, which they would see rarely, if at all! There were other Financial Incentives to Physicians to limit their Patients’ access to Tertiary Care. These incentives set Patient against Physician, thus destroying this sacred trust. Remuneration for Physician services by the Government and the HMOs has dwindled to the point of Unprofitability and has compelled the Bankruptcy of increasing numbers of Practices, and the search for Other Sources of Income by Physicians. No other Profession in the United States is denied the ability to raise fees to cover increasing costs of doing business. The Government, becoming increasingly desperate that all its strategies to control costs had failed (because they themselves were the cause of Cost Inflation!) resorted to Criminal Prosecutions of Individual Physicians and Hospitals for alleged Fraud. The Regulations being so Arcane and Vague, a simple Billing Error could be interpreted as Fraud. Most of those so pursued, being financially unable to defend themselves, simply capitulated and paid Huge Sums to the Government. Some were imprisoned. In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A System whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a Free Profession. We, therefore, the undersigned Physicians of the United States of America, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name of our Patients solemnly publish and declare, that we will withdraw our participation in all above-described Third Party Payment Systems. Henceforth and Forever, we shall agree to provide our services directly to our Patients, and be compensated directly by them, in accordance with the ancient customs of our Profession. As has always been true of our Profession, our charges will be adjusted to reflect the Patients’ ability to render payment. Nothing prevents any patient from purchasing and using Insurance. The Patients’ medical interactions with us will remain completely confidential. We pledge the highest level of Service and Dedication to their Well-Being. And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.

This powerful document should be studied by anyone who believes so-called “Universal Health Care” (either with a single provider system, single payer system, or “mandatory health insurance”) is a good idea. As our national debt continues to increase, and our currency becomes increasingly fragile on international markets, the question remains how we can even consider printing and borrowing the money necessary to make our current model of expensive “corporatecare” a “right”. And do you really want more corporatecare, or is it time to change the system?

Perhaps my biggest concern is our current fascination with mandatory health “insurance”. As the declaration above so eloquently states, “Slowly, insurance changed into payment for all Health Expenses, minus a small and shrinking deductible, which led to further Inflation, and a call to control costs.” You see, health insurance isn’t really insurance anymore. Insurance, by definition, is pooling risk for unexpected and often catastrophic occurrences. Health insurance that gives you unlimited access to providers and treatments with a $15 copay isn’t insurance at all.

Think about it — if you’re a homeowner with homeowner’s insurance, do you expect the insurance to cover new carpeting or a new coat of paint? What would your insurer say if you burned down your house because you liked having campfires on the living room floor to roast marshmallows with your kids? They sure wouldn’t build a new house for a $15 copay. And how much would “fix anything, no questions asked” homeowner’s insurance cost?

For those who still think that “Universal Health Care” is a panacea, a couple of articles from Canada are also worth considering. Manitobans with colon cancer don’t have access to Avastin, a drug shown to increase survival in colorectal cancer:

CancerCare Manitoba claims the cost of the drug is too high and they cannot afford it. Yet the drug Herceptin, given to breast cancer patients, is more expensive. Patients who received Avastin through CancerCare had approximately six to 10 treatments, at an average cost of $2,000 per treatment. Granted, some chemotherapies have been deemed more effective in maintaining life for a longer period of time and perhaps the cost/benefit seems to be greater. But why discriminate against colon cancer victims, especially since the health system has a “duty of care” to these patients. There has been no major effort to implement a screening process for colon cancer, even though the provinces agreed to do so in 2002. Manitoba announced it would begin screening in the spring of this year. Where is it?

Do you still want unaccountable federal and state bureaucracies making decisions about what prevention strategies or therapies are available for you?

Also consider this CMAJ editorial from the year 2000, which while obviously in favor of Canada’s single payer system, acknowledges the precipice they are walking by rationing care:

If we want to maintain universal and comprehensive medicare we can do one of 2 things: increase funding, or ration services. If we want to maintain comprehensiveness without increasing spending, then “medically necessary services” will have to be rationed. And with rationing there are only 2 options: rationing by exclusion on the Oregon model, or by “delay and dilution”. We favor frank discussion about the former. We are already doing the latter and it doesn’t work.

Sounds like they’re choosing between the frying pan and the fire — trying to meet unlimited needs with limited resources is always an economic impossibility.

So what do we do? How about freeing the market for health insurance so people can buy as much, or as little, coverage as they need? How about removing the irrational coupling of healthcare and employment? How about eliminating all taxes on saving for healthcare, without arbitrary restrictions on contribution limits? (Well, we need to eliminate all taxes on income and savings, and not just for healthcare… but that’s another story.)

Those three simple steps would allow people to start saving for healthcare expenses, and purchase insurance coverage for truly catastrophic events. More patients would then be truly “shopping” for routine healthcare, looking for the providers who would provide the best value for their healthcare dollar. And providers could again truly engage with their patients as individuals, and help choose which treatments and therapies are best given their individual preferences and priorities.

The system will not change overnight, and we can’t suddenly eliminate the current “safety net” of government support, but we can take aggressive steps to move in a better direction.

Often when I talk to people, questions come up about the current subprime/mortgage crisis and just how serious its impact is on our banking and financial system. This recent CNN/Money article does a good job of summarizing the “writedowns” announced and projected by major commercial and investment banks, and the impact that those writedowns will have on the broader credit markets.

So what’s going on here? Why does the system seem so fragile, and how can some bad mortgage loans amplify into a “$2 trillion lending crunch”?

Quite simply, when you create money out of thin air, it can (and does) just as easily disappear back into thin air. It’s all about leverage — $100 deposited at the bank allows the bank to create $90 in new loans (assuming a typical 10% “reserve ratio”). Those new $90 then go into circulation through  the bank’s customers, and most of those $90 are put on deposit again, which creates more reserves, and results in still more loans. Lather, rinse, repeat… and you end up with a tremendous pile of money on top of a tremendous pile of debt.

So that’s how a fiat currency and “fractional reserve” banking work in building up the money supply. What should also be clear, however, is how such a system will work equally aggressively in reverse. When a loan is made that is determined to be “bad”, or an asset listed on the books of the bank is found to be suddenly much less valuable then previously believed, then the bank has a problem. If its reserves decrease, then it needs to replace those reserves, or reduce its lending proportionately. That may mean restructuring, seeking additional investment, shutting off lines of credit to businesses, calling in loans, or begging for help from the Federal Reserve.

When a bank suddenly stops lending, businesses that need credit suffer. When a bank calls in loans, businesses really suffer. Suddenly reserves are being pulled out of the system, and the contraction ripples through the system in reverse. None of those things are good for sustained economic growth, or the health of the economy.

So what about the Fed? Ultimately, in a fractional reserve banking system, we need a central bank. The Federal Reserve’s ability to be the “lender of last resort” and be the ultimate source for creating fiat money out of thin air ensures that we won’t have obvious bank failures… but unfortunately the new money created to keep the inherently unstable system solvent causes inflation and the destruction of your dollars’ purchasing power.

Over the past 20 years, your dollar has lost 46% of its purchasing power, or equivalently, prices have run away from your dollar by 84%: $1.84 in 2007 is required to buy $1.00 in 1987, according to the Bureau of Labor Statistics’ Inflation Calculator. It’s not a mystery why this occurs, it’s a fundamental consequence of a system in need of help. There is a better way, however. Sound money, and sound banking, result in price stability and sustained, long-term, stable economic growth. Our nation doesn’t remember what that looks like, however, so it’s going to take some education to get there.

Addendum: When you’re ready to laugh about these events, check out this video:

Regardless of whether you own a weapon, every American should take a gun course that includes guidelines for when Deadly Force may be legitimately used in self-defense. While taking such a course recently, I was struck by the obvious parallels between personal defense, and national defense.

At least in North Carolina, there are four conditions that all must be present to justify use of Deadly Force in self-defense:

• There must be an real and immediate threat of death, serious injury, or sexual assault such that a normal person believes Deadly Force is necessary.
• The threat must be otherwise unavoidable.
• You cannot instigate the dispute: “If you start a fight, you lose your rights.”
• You cannot use excessive force.

These four criteria have interesting implications. First, regarding the immediacy of the threat: a history of violence and/or a fear of future violence do not justify the use of Deadly Force. For example, a repeatedly battered wife who chooses to kill the abusive husband between assaults is not justified in using Deadly Force. The husband must be physically threatening/attacking her for Deadly Force to be justified.

Regarding the concept of “avoidability”, in North Carolina there is a “Duty to Retreat” such that you must attempt to avoid or exit the hostile situation if possible. An important exception to the Duty to Retreat is if you are on your own property. In that case, obviously, you are in your “retreat” and can use Deadly Force if the other conditions exist.

Here’s an interesting case study, however. You’re an armed citizen awakened by a noise downstairs. You and your shotgun peek around the corner and see someone pulling silver out of the dining room cabinet. Are you justified in using Deadly Force at that time? Perhaps surprisingly, you are not. Deadly Force can only be used in defense of life or physical harm. It is not justified in defense of property. If the thief tries to surrender or escape when he hears the action on your shotgun, you cannot fire. But if he starts running towards you, you are more justified in using Deadly Force.

Even more interesting: You’re an armed citizen awakened by a noise downstairs. You and your shotgun peek around the corner and see someone forcing his way in through the back door. Are you justified in using Deadly Force at that time? Thanks to something called the “Castle Doctrine”, you are. While your castle’s perimeter is being violated, you are justified in using Deadly Force. Once the trespasser is inside, however, he must be a real and immediate threat to your life or physical safety.

Another important point is that you are justified using Deadly Force in defense of an innocent victim, but only if all four criteria above are met and the victim would have been justified in using Deadly Force him/herself. Especially important is the third criterion, or identifying the true instigator in the fight. Are you justified in defending an elderly lady being beaten by a group of muggers? How about walking into a convenience store and seeing two men struggling on floor, when one man reaches for a knife? In the first case, the true victim is fairly obvious. In the second case, however, it’s impossible to know who instigated the conflict. In other words, there’s no “Defense of Innocents” if you stumble onto a fight between the Hatfields and McCoys. In that case, as a citizen, diplomacy is the only solution.

Is it reasonable to think that the our guidelines limiting use of Deadly Force for citizens and law enforcement officials would also apply to us as a sovereign nation, and “global citizen”?

Amendment IV

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

This morning the government seized my property. You may have heard about it, or read about it, although probably not in the Old Media. Here’s an article that describes the raid on the Liberty Dollar headquarters in Evansville, IL.

You see, just over a week ago I placed an order for some Liberty Dollar “rounds”, or 1 ounce silver thingys. (I’m not going to call them “coins”, since they’re not “legal tender” and I wasn’t intending on using them as “money”.) They’re just attractive, and heavy, mementos of what money used to be — something with intrinsic value. Here’s a picture:

I gave them a check, and was awaiting receipt of my silver pieces, when I read the news today. What’s a guy to think? Is it now illegal to purchase silver in the United States of America? What has the government done with the silver that I purchased? Most importantly, when will the FBI show up at my house with an apology to give me my property?

It’s ironic, though, to consider all the stuff that IS being sold today. I just discovered Facebook a few weeks ago, and was amused to discover that people are apparently willing to exchange Federal Reserve Notes for “gifts” on Facebook that are entirely virtual. Check this out:

Oh, wow! A Jibble! I’ve always wanted one of those! And my friends would think I’m SO COOL if I sent them a few! Mom, can I have some money to send my friends some Jibbles??? (Better hurry, though… they’re only creating 100,000 of them! Will they finance???)

Question: What do you call a country with a $9.1 trillion national debt, and an $800 billion current account deficit, that seizes its citizens’ silver but has a profitable market exchanging its paper currency for Jibbles?

Answer: Bankrupt.

Maybe I’m asking too much of our government, and maybe the Fourth Amendment is still intact — perhaps I just need to change my expectations for the word “unreasonable”. But would it be unreasonable search and seizure if the government took away my Jibbles?

Addendum: Video just in.

Well, it finally happened. After first learning about Rep. Paul in the South Carolina Republican debate, where his principled and rational stand against Mr. Guiliani cured my political apathy, after weeks of studying his Constitutional philosophy as executed over a twenty year Congressional career, and after months of beginning to get involved in our local grassroots effort here in North Carolina… I finally met Ron Paul.

My wife and I drove down to Columbia, SC last night along with a couple other folks from the Triangle Meetup, and were greeted by the most diverse crowd I’ve seen in one place. Folks of all ages, ethnicities, and economic/social backgrounds were there, all united by one common thread: a respect for individual liberty, and a desire to get our nation moving back towards our Declaration of Independence’s ideals through a federal government that honors its Constitutional contract with the people.

The crowd was warm and inclusive, and striking up a conversation with folks was incredibly easy. We’re all Americans concerned with the future of our country, and the more we talk with each other, the more bridges we can build to heal the wounds that have divided us for so long. It was a chilly evening in Columbia, but as the crowd grew in the amphitheater, a warmth became apparent that can only be ascribed to the flame of liberty in all those people.

Rep. Paul’s speech was the finest I’ve heard (audio here). Perhaps I’m biased since it’s the first one I’ve seen in person, but having seen most available footage on YouTube, I was particularly moved by his passion, sincerity, and openness in discussing the challenges we face. At the close of the speech, the crowd paused momentarily as people realized that we could actually approach the front and meet him. The rush to queue up commenced, and we milled around talking to folks for quite some time waiting our turn. After introducing myself as a fellow Duke Med alum and having Rep. Paul sign my pocket Constitution, a kind soul captured a photograph that will be our Christmas card this year (sorry, kids!):

We then spent some time talking with other folks we’d met, and even checked out a Zap! electric vehicle being sold in South Carolina by a local entrepreneur and campaign volunteer. As we made our way back to the amphitheater, Rep. Paul was preparing to depart but I was able to speak with him one last time about my confusion with some publicly-available personal income tax statistics:

He and his campaign/security detail then made their exit, to cries of “God bless you, Ron Paul!” from waving supporters.

All in all, well worth a four hour drive. Too bad our state’s primary is so late, but tonight really reinforced my desire to help our neighbors in South Carolina mount an excellent campaign to share the unifying message of what America can be. As Morgan Freeman says in this fantastic video, “The real glory of the Declaration of Independence has been our nation’s epic struggle throughout history to close the gap between the ideals of this remarkable document and the sometimes painful realities of American life.”

Thanks to the good folks in South Carolina, and indeed across the nation, I’ve never been more optimistic that our epic struggle will be successful in closing the gap.

Following my discussion with Carl Kenney a couple of days ago, I’ve been reflecting on a fundamental question: What is freedom?

I won’t pretend to have a universal answer for everyone, but I really started thinking about this issue while spending several weeks in China and Hong Kong over the summer. Having been investing in Asia for some time, I really wanted to see firsthand what this “Asian Miracle” is all about. What does capitalism look like in a totalitarian state? Is the 10-12% GDP growth in China “real”? Are average people benefiting from the growth, or is it just multinational corporations exploiting cheap labor? Those were some of my questions, and as I dove in and talked with folks, some patterns became clear.

First, I was amazed to meet a lot of Chinese in major cities from my generation (20s-30s) who speak English, are extremely well educated, and are enjoying a rapidly increasing standard of living. These folks are literally “Chuppies”, and they are seizing China’s transition to a market economy and the opportunity that provides with both hands. Importantly, there is hardly ANY consumer debt, and the household savings rate in China is over 25%.

Think about that for a moment — no consumer debt. Want to buy a car? You’d save and pay cash. You’d have no student loan, credit card, or home equity loan payments. China is only JUST beginning to embrace mortgages to buy property/housing. What would your life be like if you only had to buy food, gas, clothing, insurance, and educational/recreational stuff?

That’s not to say the Chuppies aren’t consuming. They want, and have earned, a Western standard of living: from rice to beef, from bike to car, from room air to air conditioning… everything that the middle class and above takes for granted in the United States is also being enjoyed by China’s growing middle class. They’re just not borrowing money to do it.

So that’s one way to look at freedom — economic freedom. When you have a bunch of money invested and saved, no debt to service, and just living expenses to cover every month, would you feel forced to take a job that you find unrewarding? Might you possibly be inclined to think like an owner, instead of an employee, and start your own entrepreneurial venture?

What I found talking with folks in China is that the entrepreneurial instinct for the average, educated urban Chinese has never been more alive and well. People in this growing middle class are focused on creating value for themselves in the market. I was so shocked by this realization — here I was in a country with a totalitarian government, no tradition of individual liberty such as in our Declaration of Independence, and a censored Internet… yet I’m meeting folks in offices and tea rooms who feel “freer” economically than many (if not most) people I know in the United States!

Not to say that China doesn’t face significant challenges — they also struggle with dirty air, dirty water, rising inflation, and questions of how to address the folks who haven’t kept up with the economic boom. But the important distinction for me isn’t China’s current position, but its direction. With economic liberalization comes increasing prosperity for more people. Those increasingly prosperous people are also less tolerant of arbitrary and capricious social restrictions, as well. Who knows how far social freedom will go in China? Based on my experience, however, it’s moving in a positive direction — certainly relative to the history of the Cultural Revolution.

Contrast China’s dynamic with the United States. We cheer over 2-3% GDP growth, suffer from rising inflation that is understated by the government, and have a negative household savings rate. Of course, with inflation, it doesn’t make sense to save in the traditional sense — a savings account gets eaten alive by inflation, so you have to take additional risk and invest in high-growth opportunities to keep up. But more folks aren’t even trying to invest OR save. We base our purchase decisions on what the monthly payment will do to our budget, and God forbid we lose our job, and our healthcare benefits.

The average American with credit card debt, student loans, mortgages, and car payments NEEDS his job. Leaving a job is a high-risk proposition, and forget about financing your OWN business to test that great idea that you always wanted to commercialize. Instead, we live in The Office, or The Matrix, and forget what it means to be free.

Ironically, in a situation as perverse as ours, one can argue that we really DO need minimum wage laws. You see, people are so enslaved by debt, and so dependent on monthly cash flow, that it’s tough to walk away from ANY offer when you’re desperate. What would happen if people felt free to say “No, thanks” and start their own business, if they couldn’t find an employer that met their expectations for job satisfaction and income?

Does it have to be this way? Well, having governments that encourage consumption and punish production through a punitive tax code and cheap debt doesn’t help. But ultimately, it’s an individual decision to take on debt. The fact that our society makes it so easy doesn’t eliminate our responsibility for the problem. Would you like to be economically free? Meet Dave Ramsey. He’ll help you figure it out.

Note that my focus on economic freedom thus far is on folks who are earning (or attempting to earn) a wage. There’s a whole other category of people who depend on the generosity of others to survive. Ironically, many people in the so-called “welfare state” are actually closer to true economic freedom than the “middle class” two-income family just fighting to survive.

How can that be? Simple — If you’re debt-free and used to a lower standard of living, what do you have to lose by trying something new? If you’ve figured out how to survive on welfare, even barely, you are MUCH better positioned to take a risk and create some REAL value for yourself. Go figure.