Tuesday May 03 , 2016
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The Road to Tyranny, Part I

This posting will be necessarily short as I want to outline for you what I will be writing about over the next several days.  I believe that we have in place in this administration and this Congress the elements of a regime that is hellbent on taking over absolute control of the people of this nation so as to move toward some idealized state of man and being.  At the root of this ideology is the concept of egalitarianism, a concept that strikes at the very foundation of all that makes this country so exceptional.  If progressives were to have their way, everything produced by those that are productive would be taken away and given to those that are not.  At the end of the day, everyone would have exactly the same set of outcomes.  Of course, this very idea flies in the face of all that Americans hold true.

We are a nation that believes in individual freedom, liberty and accountability.  Because we believe so strongly in this trilogy, we embrace the idea that rather than striving for equal outcomes for everyone, we must create an environment that allows everyone equal opportunities--equal access to being able to achieve as much as one can or wants to without the encumbrance or interference of an intrusive and coercive government.  As we are a nation of laws and not of men, we adhere strongly to the covenant we find manifested in our Constitution, where property rights, natural rights and common rights are protected from those that might embrace tyranny to take away from those that live by the covenant and expect others to do the same.

In subsequent entries, I will outline the objectives, motives and mechanisms of the progressive movement in this country.  Let there be no mistake, they will do whatever it takes to achieve their goals.  We need look no further than the healthcare debacle to see that their behavior, not their rhetoric, is what needs to be watched.  More later and thanks for listening.



The Regulatory Paradox

I had an interesting experience today.  I gave a presentation at one of our local hospitals to a group of doctors and staff about the economics of the healthcare reform bill.  I also received an email from one of my dear friends with an editorial attached that had been written by Howard Fineman of Newsweek.  The reason I mention both in the opening paragraph is that the events provided irrefutable evidence that the American people have been sold a bill of goods by this administration and the Congress when it comes to this legislative abomination.

I am a political economist by education and experience.  One of the things we ask government to do for us to support capitalism is to provide the environment for fair and free markets.  This can be done in a number of ways that do not interfere with market processes.  However, when the central government of the United States decides to regulate something--in the name of fair and free markets--the unintended consequences of those actions are exactly the opposite. 

When the government determines that an industry needs regulation, the intention is most likely to protect the consumers from some nefarious actions on the part of greedy suppliers.  Perhaps this is true in some instances, but for the most part, such actions inevitably lead to decreased, not increased, competition, more highly concentrated markets, more price inelasticity (this is a big deal) and the certainty of ever increasing prices that have to be paid by consumers.  As our old friend Monk would say--here's what happens.

In truly competitive markets we have many suppliers, easy entry and exit into the market and because no single vendor or small group of vendors control major market share, the suppliers must take the price dictated by consumers in the market.  This is called price taking, for obvious reasons.  This situation is best for the consumers and forces suppliers to manage costs internally.  Each supplier is in that particular market because he or she could overcome the opportunity costs of being in the market.  The suppliers make that determination based on where they might have comparative advantage.  They make that determination based on where they give up the least--overcoming less opportunity cost--to enter that market.

When the government decides to regulate an industry, their actions increase the cost of entry into the market.  Likewise, suppliers that are in the market already have increased costs.  They now must make the determination if they can stay in the market.  Typically, only those enterprises that are large enough to survive under more restrictive circumstances are able to stay in the market.  With fewer suppliers in the market, these large enterprises now control a much larger share of the market, thus moving from being price takers to being price searchers--searching out the highest price available in the market.  This concentration of market share in a smaller number of suppliers can actually facilitate collusion that inevitably leads to price fixing.  Further, because  price is now being controlled more heavily by suppliers and not consumers, the demand for the commodity is more than likely inelastic--less sensitive to price.  Such is the case with medical services.  When we need health care or health insurance, we will likely pay about anything to get it.  One does not need to be a Harvard economist to see where this is going.

When the government so heavily regulates the actions of health insurance companies, thus raising the opportunity costs of all 1300 companies now in that business, many of those companies will get out of the health insurance business because they simply cannot make a profit there.  Only the largest companies will survive.  So, rather than increasing competition among insurance companies, the national government actually inhibits competition.  Worse, these large companies, to continue to make profit, will do exactly what the national government says--they become an extension of the government and with the weight of the national government behind them, use the same coercive techniques to make determinations about who gets what when.

I can understand why doctors working nearly around the clock might not be up to speed on this type of legislation, but there is no excuse for a person of Fineman's status to reveal such an incredible lack of economic knowledge.  Unfortunately, Fineman thinks it's a good thing that only a few companies are doing the government bidding for the sake of the people.  He states that big companies will do fine under Obamacare and he is absolutely correct.  Unfortunately, the people are the ones that lose out on every count under these conditions.

Fineman is typical of the power elites and faux-intellectual elites that think they know more than we do.  What is clearest is that Fineman, those of his ilk, most members of Congress, most members of this administration and nearly all progressives have never had a class in economics.  I can say without reservation that the students in my principles of economics class have a firmer grip on the mechanics of supply and demand than any of those mentioned above.

The Regulatory Paradox, then, is when government interferes in market processes, competion is greatly and irreparably damaged and the consumer ultimately pays the "price" for this interference.  This is just one more reason to run all of them off Capitol Hill come next November.  As the bumber sticker states, "If you think education is expensive, try paying for ignorance."  Well, folks, we are going to pay big time. 



Turning Into the Wind

As the dust settles after the latest assault on the Constitution through the healthcare legislation passed by this Congress and supported by this administration, I am taking heart in what I see taking place in towns, cities and villages around the country.  There is a resolve there that is growing and that is being fed by a certainty that following and upholding principles is a just pursuit.  I also think we are seeing the recognition that this fight is going to be a long one--lasting from generation to generation--so we need to arm ourselves with the facts, the truth and will to follow through.

I remember being out on the USS Ranger during the Gulf War.  I was a land loving Air Force fighter guy, so being on a boat in the middle of the Arabian Sea was disconcerting on its own, let alone being out there in a war zone.  Air Force and Navy fighter pilots have a lot in common, but the one thing the Navy has to do is take off and land on that ship.  When the Captain was getting ready to launch the next set of sorties to fly into Iraq, he ordered the ship to turn into the wind.  On deck, the ballet of crew chiefs, launch officers, gear riggers, etc., was something to behold.  What struck me was the precision with which these men and women went about their business.  What struck me even deeper was that there was an air of confidence in each of them, borne of the knowledge that they were prepared, that they were trained to do what was necessary and that their mission was just.  Their resolve was evident to even the most casual observer.  This past week, Conservatism in this country turned into the wind.

The next few months and years will not be easy.  Conservatives around the country will be accused of being anti-intellectual, ignorant, backward and unworthy of the grace of those that are currently in charge.  What will be worse, however, is that Conservatives will be branded by the main stream media, the power intelligencia, the power elites and every stripe of progressive with being racist, homophobic, greedy and uncaring about their fellow citizens.  Do not fall for any of this. 

I direct your attention to the editorial written by liberal apologist Frank Rich in the Saturday edition of the New York Times.  Conservatives, he asserts, are not angry about the healthcare bill, we are supposedly angry that a person of color is in the White House.  Really?  Most of the people I know are really upset because the bill is unaffordable, centralizes more power in the national government, takes away our individual liberty and that nearly 20% of our economy has been socialized.  That's why we are upset.  Is the President really a person of color?  Who knew?  Most of us think he remains the most unqualified and unprepared person to ever be President of the United States.  The evidence, contrary to Mr. Rich and his ilk thinking otherwise, is on our side.

We will have a tough fight on our hands, because we cannot give in even a little.  Principles will always win out over amoral, self-gratifying, intrusive and suppressive actions on the part of progressives.  Honestly, I think they can't really help themselves.  When one lacks a moral center, one's actions are wholly unpredictable.

We have turned into the wind, so show your resolve.  Show your confidence.  Show your strength by doing just a little more than is expected.  This is a war we can win.


Updates on the Website and Show

First, thanks for the tremendous response from all the listeners to the show.  So far, so good.  To help in making the information generated through research and broadcasting, I am working with our Powell Broadcasting partners to make sure we continue to make the website more user friendly.  Of utmost importance, however, is making sure we build upon a quality product that meets the expectations of our listeners and those attracted to this website.  Here are some of the things we are going to do.

  • Beginning tomorrow evening, I will be updating the new "Commentary" section twice a week.  I will post on Sunday and Wednesday evenings.  This schedule will allow you, the readers and listeners, a chance to come to the page and see fresh material on a regular basis.  The only reasons I will not post on that schedule is if I am indisposed or unable to access the internet.
  • Very soon, I will be posting a "question of the week."  This section will operate very much like a blog so you will be able to post your thoughts and opinions so all can see.  I want to encourage all of you to use this mechanism to get the best ideas out there for all to see and comment on.  You will still be able to post comments on my "commentaries," as well,  so the "question" section is an added feature to enhance communications.
  • Please check out the bottom tool bar.  There, you will find a "notifications" button that will bring a pop-up that will contain some the latest updates to my activities or what is going on with the show or website.  You will also see that you can translate the website content to another language if you so choose.
  • The team and I will be adding a survey section in the future where you will be able to participate in surveys about various topics.  I will include in the surveys topics directly associated with the show so you can give me feedback and input on what you might want to hear.
  • This fall, I will be presenting a lecture series to cover nine nights in September and October.  The topic is "Serious Civics: A Guide to the Constitution, Government and Governance in America Today."  This series was inspired by a listener that thought that a refresher on civics, particularly in the current political climate, might be useful.  More on the series over the next few months.

The show will be entering its first ratings period in April.  As with any business, we are anxious to make sure we are successful in getting the best product out to you.  Please spread the word to get your friends and neighbors to listen if you think we are providing a good product.  The folks at Powell Broadcasting have been most gracious in allowing me on the air and you, the listeners, will keep me there.


What about next November?

I just ordered Michael Barone's Alamanac of American Politics for 2010.  Over the course of the next few weeks, I will be doing some intense research on the elections of 2008 and will then put out some predictions for 2010.  I will also be doing some serious public choice economics analysis of the legislation that is about to be passed in the House.  The preliminary work is really disturbing in the overall impact this legislation is likely to have on our quality of life in the country.  The standard of living we enjoy today is likely to be as good as it gets for us.  Our children will certainly not have anywhere near the quality of life we have had.

As the facts about this bill and the deals that were made to get it passed are revealed, whatever bump the President might enjoy from his legislative victory will be short-lived.  In fact, I am willing to project that his approval rating goes into the 30s before Memorial Day. 

Perhaps the greatest offense a politician can commit is lying to and deceiving the people.  Our trust of government have never been lower.  The short term gain of passing this bill will fade quickly as the American people turn their backs on the President, his administration and the majority party in Congress.  They will prove beyond any doubt that they cannot be trusted.  They will lose all credibility with us--even more than they already have.

We are witnessing history--certainly in more ways than we might imagine tonight.  Keep the faith.  We will take our country back.


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