About This Blog

Ludwig von Mises (1881-1973) was the greatest economist of my time. His greatest works can be accessed here at no charge.

Mises believed that property, freedom and peace are and should be the hallmarks of a satisfying and prosperous society. I agree. Mises proved beyond a shadow of a doubt that the prospect for general and individual prosperity is maximized, indeed, is only possible, if the principle of private property reigns supreme. What's yours is yours. What's mine is mine. When the line between yours and mine is smudged, the door to conflict opens. Without freedom (individual liberty of action) the principle of private property is neutered and the free market, which is the child of property and freedom and the mother of prosperity and satisfaction, cannot exist. Peace is the goal of a prosperous and satisfying society of free individuals, not peace which is purchased by submission to the enemies of property and freedom, but peace which results from the unyielding defense of these principles against all who challenge them.

In this blog I measure American society against the metrics of property, freedom and peace.

Thursday, December 8, 2011

The Wizard of Osawatomie, Part I

Tuesday President Obama delivered a historic speech in Osawatomie, Kansas. At least some pundits are calling the speech historic. Obviously, the President himself wants the speech to be considered historic because he chose to deliver it in Osawatomie, the site of Theodore Roosevelt's famous "New Nationalism" speech which Roosevelt delivered on August 31, 1910 -- over a 100 years ago.


Like Obama's, Roosevelt's speech was part of his campaign to be reelected President although, unlike Obama, Roosevelt was not the sitting President at the time. Teddy had served as President from 1901 to 1909. Like Roosevelt, Obama used his speech in Osawatomie to outline his progressive political philosophy and garner voter support.


On the one hand Obama's speech was nothing new. The video and text of the speech are here. On the other hand, his speech is the closest Obama has ever come to unveiling the whole of his economic beliefs. In this respect the speech is shocking.


Astute observers have known since the beginning that Obama is a Progressive. After all, his voting record in the Illinois state legislature and in the US Senate (despite the brief career he had there) clearly show the man is far to the left of the political spectrum. Unlike other Presidents, Obama's academic writings have been sealed. They are purported to be leftist rants that advocate socialism. This, again, does not surprise those in the know. Obama's own writings recount his mother's unabashed socialistic beliefs and the fact that he was mentored by a famous avowed socialist. The debate among knowledgeable and critical pundits has always been over whether or not Obama is consciously a socialist or a Keynesian or, indeed, whether Obama is ignorant of economics altogether. Despite his speech, this last point remains unsettled.


Philosophically, Obama's "Giving Everyone A Fair Shot" speech of Tuesday exposed him as a dyed-in-the-wool progressive. Economically, the speech betrayed Obama as a dyed-in-the-wool Keynesian, at least his interpretation of American economic history is thoroughly Keynesian. Whether the man understands Keynes' economic theory, or merely relies on Keynesian economic fiscal and monetary policy recommendations is unclear.


What is absolutely clear is that Obama neither understands nor agrees with Austrian free market economic theory. It is apparent as well that Obama -- or whoever wrote his speech -- is a fuzzy thinker.


Over the next few days I plan to elaborate on these observations by focusing on specific excerpts of Obama's speech. However, for now, let me compare Obama, not to Teddy Roosevelt, but to Oscar Zoroaster Phadrig Isaac Norman Henkel Emmannuel Ambroise Diggs, otherwise known as The Great And Powerful Wizard Of Oz.


Mr. Obama, like Mr. Diggs, is a master of misdirection and prestidigitation. Mr. Obama does not hide behind a curtain pulling levers, but he does use smoke and mirrors to mislead the public. Of course, I mean political smoke and mirrors, i.e., half-truths, myths, exaggerations, logical fallacies and outright lies -- the means by which most politicians ply their trade.


For example, in his speech Obama points out that the free market should never be "a free license to take whatever you can from whomever you can." This is a strawman argument. No economist understands a "free market" as a market which legitimizes theft. I think even Roosevelt understood that much.


Moreover, Obama criticizes a "certain crowd in Washington" that "sings the same old tune," namely, that the "market will take care of everything,” The only elected politician in Washington who might possibly sing that tune is Ron Paul, and he hardly constitutes a "crowd." The vast Washington crowd of elected politicians are interventionists all, i.e., they pass laws and regulations which intervene in or interfere with the workings of the free market.


Mr. Obama all but admits this when he says in his speech:

Inequality also distorts our democracy. It gives an outsized voice to the few who can afford high-priced lobbyists and unlimited campaign contributions, and it runs the risk of selling out our democracy to the highest bidder.

If the American economy were absolutely free from political intervention, i.e., if the American economy were in fact a "free market," how could "high-priced lobbyists and unlimited campaign contributions" influence the workings of the American economy? Obviously politicians are the ones being lobbyied and the ones collecting campaign contributions. Who would contribute to or lobby these politicians if they did not have power to intervene in and influence the American economy?

Mr. Obama also said: "We simply cannot return to this brand of 'you're on your own' economics if we're serious about rebuilding the middle class in this country." No elected politician in Washington has ever advocated "you're on your own" economics, not even Ron Paul. Moreover, no economist would understand what such a phrase means as a descriptor of a particular economic school.

Economics is about exchange and cooperation. In this sense, no individual can be said to be "on your own." Austrian economics advocates a strict concept of private property; Keynesian economics advocates income redistribution through government taxation and intervention. Perhaps this is the meaning Obama's fuzzy thinking and rhetoric implies. I can't say for sure. What I can say is that the whole of America's economic history exemplifies strict private property rights on the one hand and the wealthiest middle class the world has ever seen on the other.

These are but a few of the oratorical tricks used by the Wizard of Osawatomie on Tuesday to persuade the American public that the Keynesian interpretation of America's economic history is the correct one. I intend to prove over the next few posts that nothing could be further from the truth.
I only hope the American public is intellectually honest enough to believe their eyes and ears and minds once the curtain is pulled back and Mr. Obama  is exposed for the charlatan he is. 

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