Laissez Faire Links: Rational Production, Debt Hysteria, Economic Ignorance, and Obamacare

Where does wealth come from?  The answer is simpler than you ever thought.  Washington’s antics over the current debt crisis and people’s ignorance of Obamacare’s deceptive design.

  • Over at Objectivism for Intellectuals, the idea that wealth comes from action based on rational thought is not a new revelation, but simply a rebuttal to those who still maintain otherwise.  Wealth, according to the classical tradition in political and economic theory (i.e. Locke and Smith), is a product of one’s labor.  See my discussion here for elaboration on this point.  Wealth cannot be anything but a “product” of action, not wish or whim.
  • Dan Mitchell from the Cato Institute points out the current debt hysteria in Washington as nothing more than political posturing.  The issue of raising the debt ceiling, lest the government default on its obligations, overlooks many aspects of U.S. fiscal responsibilities that point to a much less severe predicament.  His comments on the Treasury Report are particularly insightful:

“The Obama Administration is deliberately trying to blur the difference between defaulting on the debt, which would have real consequences, and “defaulting on obligations,” which is a catch-all phrase that includes mundane and uneventful matters such as postponing a Medicare payment to a hospital or delaying a grant disbursement to a state government.”

“The White House wants people to believe genuine default is likely even though tax receipts this fiscal year are expected to be more than $3 trillion and interest on the debt is projected to be only $237 billion. In other words, the Treasury will collect more than 12 times as much revenue as needed to pay interest on the debt….I want to reiterate that a default only would happen if the White House wanted it to happen.”

  • The Objective Standard has an interesting, albeit bit depressing, piece on how many of the Americans who voted for Obama visualize how government, economics, and insurance markets actually function.  I highly recommend taking a minute or two to read this!
  • On a related note, Laissez Faire Today provides a piece with particular insight into why health insurance markets are so difficult to understand and so expensive.  For example, what makes them different from life insurance markets?

“When premiums reflect expected costs, people are essentially paying their own way. When that happens, it really doesn’t matter very much who chooses to buy insurance and who chooses to self-insure and bear the risk themselves….Why are things so different in the market for health insurance? Because in this market, premiums are regulated, and that regulation is completely dominated by the idea that it’s unfair to charge real premiums. In fact, the most common belief is that everybody should pay the same premium for health insurance, even if everyone’s expected health cost is different.”

See the whole article here.

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Laissez Faire Links: Myths Agaisnt Capitalism, Obamacare, Budget Talks, and the Index of Economic Freedom

Myths against capitalism, Doctors under Obamacare, budget cuts in lieu of growing government (how can that be?), and a decline in economic freedom for Americans are up for discussion today.

  • Check out Don Watkins’ new article over at the American on the common equation of successful businessmen with “greedy capitalists”.  The comparison often made between crooks like Bernie Madoff and successful businessmen such as Bill Gates or Steve Jobs are erroneous at best.  On the contrary, the two are polar opposites.
  • Ari Armstrong points out the new problem posed by Obamacare in Under ObamaCare, “The Doctor Can’t See You Now”
  • The Republicans are just as guilty as the Democrats regarding our growing welfare state.  Michael A. Laferrara discusses the supposed “cuts” from SNAP proposed by Republicans.  The important point to note, however, is that no entity in Washington questions the morality of federal assistance and its growing role in the daily lives of Americans.
  • Indeed, federal assistance has become its own institution in Washington, often dominating political issues as fundamental and basic as the fiscal budget.  The current shutdown is a result not of politics in itself, but a fundamental disagreement between left and right on the scope of government involvement, symbolized most prominently by Obamacare.  The Senate rejection of House budget proposals along with current polls of Obamacare indicate that Washington listens little to the people when making decisions that affect them on a daily basis.

In every poll conducted by eight major national pollsters this year, opposition to the Affordable Care Act outweighs support. In the September 2013 CBS News/New York Times poll, for example, 39 percent of respondents approve of the law and 51 percent disapprove. In the mid-September Kaiser Family Foundation poll, 39 percent have a favorable view of it and 43 percent an unfavorable one. The late September CNN/Opinion Research Corporation poll found 38 percent in favor and 57 percent opposed.

Ron Paul Speaks on Government Coercion and Failure

In the following video, Ron Paul lays out the conditions upon which Washington has usurped the American dream. Deficit spending, inflationary threats, the Federal Reserve, and wealth redistribution through the primary hub of government bureaucracy are all points of contention needing more open debate and general awareness among the people.  Mr. Paul discusses these with welcomed candor.

In addition, Paul speaks on the Washington’s newest threats to liberty and privacy, passage of the National Defense Authorization Act (NDAA), and most recently, the deployment of drones over American airspace.  It is a proven fact that as any government grows in size and influence, the people’s basic rights diminish at an equal rate.  Just taking a look at recent legislation from the Patriot Act to Obamacare to the NDAA paints a frightful picture of a Washington elite increasingly relying on coercion at a time when their policies are loosing popularity.

Take a look at the video and please feel free to pass it along to all you know.

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Government Subsidies Drive Up Health Costs, Drive Out Private Capital

A simple graphic shows how government subsidies act on any given market.  Not only does they drive out private capital, which by its nature is more competitive, but subsidies also drives up cost.  It is important to remember that the competitive nature of private capital actually keeps costs down, as people naturally gravitate toward the best product for the best price.  When governments subsidize markets with endless supplies of money, costs begin to rise as consumption becomes undervalued.  The graphic below demonstrates this phenomenon well enough.

Dr. Yaron Brook on Government, Healthcare, and Individual Rights

The following is a brief address given by the Ayn Rand Institute‘s Yaron Brook on the inherent immorality of government involvement in health care.  As the Supreme Court finished up its hearings this week, much attention will continue to focus on whether the Patient Protection and Affordable Care Act will remain in tact, broken apart, or simply overturned.  What is important here however, is Dr. Brook’s focus not on the constitutionality of Obamacare’s individual mandate, but on the moral rightness of individual freedom.  Dr. Brook points out that such morality exists solely from the right of ownership of one’s life.  It is critical to realize that this tenet lies at the heart of the American experience; it is the essence of what America was founded upon.  Obamacare, then, while seeking to provision health care to 40 million Americans simultaneously destroys the very foundation of western democratic society.

 

 

On an additional note, you can find the Supreme Court transcripts for the hearings here.

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