Central Planning and the Erosion of Liberty

Listening to President Obama's speech last Tuesday triggered many thoughts. Perhaps the one which hit me the hardest is that he is doing exactly what he was elected to do: design and implement government programs to actively "fix" the economy. But there is a massive problem with using government to actively solve our problems. To the very extent it "solves" our problems, it robs us of our liberty.

The political thought in this country has shifted from the time of the founding. The constitution was designed to create an environment of security and freedom which would allow individuals to live their lives and pursue their chosen values with minimal government interference--that means solving their own problems. The purpose and structure of government was simply to establish objective and predictable laws to protect individuals from the violation of their rights to Life, Liberty and Property--not just by fellow citizens, but more importantly, by the government itself.

Limiting government to the setting up and enforcement of the "rules of fair play" is no longer the major focus of politics. Politicians are elected based on their promises to intervene in the private affairs of men, pitting one special interest group against another, each jostling for a piece of taxpayer money (or more accurately, future taxpayer money as we go further and further into debt.) Politicians are reelected based on their ability to deliver the goods and to solve our problems for us.

But acting to solve our problems, to "fix the economy" means increasing government control. Government control means central planning. Central planning involves preempting and crowding out individual planning. Central planning's most fundamental essence is the deprivation of individual liberty.*

Let me repeat that:

Central planning's most fundamental essence is the deprivation of individual liberty.

Central planning substitutes the priorities and decisions of private individuals with the priorities and decisions of politicians. Instead of acting as a disinterested umpire, government has become the most powerful player on the field. The most fundamental requirements of liberty--the Rule of Law and the right to private property (which includes the presence of sound money)--are being actively undermined. Interestingly, these principles are also the same ones which allow and promote a prosperous, growing economy.

Arbitrary changes in policy and procedures, such as what we have seen in the recent actions of the the US Treasury and the Federal Reserve, both violate property rights and create an atmosphere of fear and uncertainty, destroying the predictability necessary for private economic planning. Raising taxes and bailing out insolvent businesses and individuals punishes those who have been prudent and efficient users of resources and rewards those whose poor choices have led to waste and failure. Expanding the role and burden of government has been shown time and time again to hinder economic growth**, and yet this administration (and the previous one) are attempting to defy both theory and evidence.

But getting back to my original point, these actions are what the populace seems to be clambering for. Until the general public regains its understanding of the proper role of government, we will continue to have leaders who attempt the impossible.

“You cannot legislate the poor into freedom by legislating the wealthy out of freedom. What one person receives without working for, another person must work for without receiving. The government cannot give to anybody anything that the government does not first take from somebody else. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is about the end of any nation. You cannot multiply wealth by dividing it.”
---Dr. Adrian Rogers, 1931-2005

*Those who wish to place "community" ahead of the individual will often incorrectly equate liberty with license in attempt to justify the imposition of their central plans upon others. True liberty is simply freedom from the initiation of force (and of fraud, that sneaky and non-violent form of force.) Liberty is not "doing whatever you like." One man's freedom ends where another man's begins. Equality before the law is the principle which embodies this principle--and invalidates all the political claims of special interests.

**See Economic Freedom of the World, the Index of Economic Freedom , the Global Competitiveness Report, The Noblest Triumph, The Capitalist Manifesto, The Conquest of Poverty, The Improving State of the World, Ultimate Resource 2

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Actions Speak Louder than Words, Mr. President

"Not because I believe in bigger government—I don't."

President Obama, Address to Congress, Feb. 24, 2009

Watch what he does, not just listen to what he says. Can adding $800 billion worth of spending be anything else BUT Bigger Government? For more, see here.



UPDATE #1:
Encouraging news from a Rasmussen poll shows that most Americans still don't want big government--though that makes it less clear why Obama won the election when he very openly campaigned on a platform of government as the solution to the ills caused by the "free market."

UPDATE #2:
House OKs $410B spending
Moving toward socialized healthcare
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Nietzsche on The State:

"It bites with stolen teeth. "

-- Friedrich Nietzsche (1844-1900)
Source: from "Thus Spake Zarathustra"



This image nicely sums up my reaction to President Obama's speech last night (which I hope to respond to in more detail later.) I am well aware of the fact that the previous administration did it's share of biting as well. My 'beef" is not just with Democrats but with all politicians who coercively use other people's money (a.k.a. yours and mine) to gain power and prestige, and in the process undermine both individual freedom and responsibility.

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Even Putin sees Obama's Socialism

It's hard to take a break when so much is happening--especially when so much of it is destroying our freedom and our ability to improve our lives through wealth creation.

Here is an article I just learned about. It was posted February 11th and is reporting on a speech by Putin given January 28th.

Putin Warns US About Socialism

“In the 20th century, the Soviet Union made the state’s role absolute,” Putin said during a speech at the opening ceremony of the World Economic Forum in Davos, Switzerland. “In the long run, this made the Soviet economy totally uncompetitive. This lesson cost us dearly. I am sure nobody wants to see it repeated.”*

Why has this not made more headlines?

Why does a Communist from Russia need to warn the President of the United States about the dangers of central planning?

What is going on here?

Where is the outrage?

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*Of course with Putin, it's not that straight forward. The rest of the speech is an outline of Russia's statist recommendations and activities. Still, it's interesting that the reminder of the failed Socialist experiment is coming from him.

Don't ignore the data: key requirements for growth and prosperity

This 6 minute video from the Cato institute is a brief introduction to the the key requirements for economic prosperity: property rights, rule of law and sound money. It references several important works which compare the economic laws and policies of various governments to growth and prosperity indicators. These works include Economic Freedom of the World, the Index of Economic Freedom and the Global Competitiveness Report. The current administration is instituting policies which go exactly counter to the data presented in these reports. Those who believe that enlarging government's role in the economy will reverse the recent down turn and bring us growth and prosperity need to be aware of the data which clearly counters that conclusion.

This is a dangerous time to be economically ignorant. We are loosing not only the path to prosperity, but key aspects of our freedom as well.