The Ludwig von Mises Institute

Flea markets, Goodwill, and other second-hand shops in Louisiana are in shock at an unnoticed law just passed by the legislature that actually dares to ban cash transactions. Does it apply to garage sales too (for some reason, pawn shops are exempt, apparently)? The “informal sector” of Louisiana just exploded in size.

Writing in the WSJ:

The Fed fails to grasp that an interest rate is a price—the price of time—and that attempting to manipulate that price is as destructive as any other government price control. It fails to see that the price of housing was artificially inflated through the Fed’s monetary pumping during the early 2000s, and that the only way to restore soundness to the housing sector is to allow prices to return to sustainable market levels. Instead, the Fed’s actions have had one aim—to keep prices elevated at bubble levels—thus ensuring that bad debt remains on the books and failing firms remain in business, albatrosses around the market’s neck.

Amazon.com vs the Taxman is still in the news. Numerous states are still trying to stick their paws into Amazon’s pot to grab some of the company’s dough by nailing it with their sales tax laws.

The state of Connecticut passed a new Internet tax law and contends that Amazon had a physical presence because it had affiliations with websites through its Amazon Associates program. Of course, Amazon dropped the Associates program in Connecticut to avoid having to collect the sales tax or fight that contention. In fact, the same scenario took place in California this year – so Amazon dropped its California Associates program to opt of that government scheme. The headhunting tax thieves from so many states are so focused on getting Amazon, this has come to be known as the “Amazon Tax.” Theft-seeking bureaucrats are fond of supporting their schemes as a logical move to combat an “unfair advantage” that they say online retailers have over brick-and-mortar retailers.

The Amazon Associates program allows website proprietors, bloggers, etc. make money by referring their readers to the Amazon site to make purchases. Some of the busier websites are able to cover a lot of their costs through this program. So now, a lot of folks who were able to benefit from their website traffic have lost out.

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The first wonky study is in that show’s that Cain’s plan raises taxes. Isn’t the always the case with tax reform that doesn’t simply lower taxes? If these guys wanted lower taxes, they would lower taxes. All the rest is smoke and mirrors. Search national sales tax on Mises.org and you get the idea.

Some cancellations have taken place for our Friday high school event. It had previously been closed. Now we have about 20 open spots. Register!

Mises.org has been pushed very hard to comment on the Bitcoin issue, and I’ve probably read and sent 10 articles around for review. We’ve run nothing on it just because the right piece that takes full account of both the technology and robust monetary theory just hasn’t been written. In the meantime, it seems that Bitcoin is tanking.

Any libertarian has to have some sympathy for any effort to create an alternative currency, and the state has narrowed the options so much that we can fully expect a long series of nonviable projects to emerge in the future. It is part of the terrible struggle of our times to find ways of living free in an age of government omnipotence.

Get it here.

I’m still startled to read mainstream articles that openly admit the depth of the economic disaster – and to read them still nearly four years after all the stimulus plans were underway and following four years of “green shoots” puff pieces in the press about how recovery is right around the corner:

The United States has a confidence problem: a nation long defined by irrational exuberance has turned gloomy about tomorrow. Consumers are holding back, businesses are suffering and the economy is barely growing.

There are good reasons for gloom — incomes have declined, many people cannot find jobs, few trust the government to make things better — but as Federal Reserve chairman, Ben S. Bernanke, noted earlier this year, those problems are not sufficient to explain the depth of the funk…. Americans have lost a vast amount of wealth, and they have lost faith in housing as an investment. They lack money, and they lack the confidence that they will have more money tomorrow.

Many say they believe that the bust has permanently changed their financial trajectory.

And the theory as to why this is happening? It’s the same as in the 1930s: conventional thinking say it is that prices are too low. “That has led a growing number of economists to argue that the collapse of housing prices, a defining feature of this downturn, is also a critical and underappreciated impediment to recovery.”

I have a long, fairly detailed and systematic blog post up at The Libertarian Standard discussing the demands of the Occupy Wall Street (OWS) movement for an end to “corporate personhood,” and a host of related issues:

The politics of the left-oriented Occupy Wall Street (OWS) movement, like that of the right-oriented modern Tea Party movement, is not very well defined. But one of the things some of the OWS participants are calling for in their list of “demands” is an end to “corporate personhood.” In this they echo the views of left-libertarians who contend that state-chartered “corporations” are the source of grave social ills.

Some of these issues were recently debated on the pages of Roderick Long’s blog, in the comments to his post “Double Standard.” Left-libertarians who oppose incorporation, and usually also “capitalism,” argue that firms derive some great benefit from the state by the privilege of incorporation. The standard leftist critique of the corporation is the “concession” theory outlined by Robert Hessen in his seminal study In Defense of the Corporation (see a key excerpt from pp. 18-21). They argue that the state grants to corporations three features: entity status, perpetual duration, and limited liability to shareholders, all of which are artificial and would not exist absent state intervention. Left-libertarians maintain that these privileges grant corporations more power than they otherwise would have, which distorts the market, nay, society in general. This gives rise to more “hierarchy” and “authoritarianism” than would prevail in what Hans-Hermann Hoppe calls a private law society, and indeed, to “exploitation” of the workers by the bourgeoisie.

The Alleged “Privileges” of Incorporation

Labor Theory of Value

There are several problems with the left-libertarian and leftist critiques of corporations. One is the acceptance of a Marxian-type labor theory of value—the idea that employers per se “steal” or exploit from workers the “social surplus product”—a discredited, hoary, unscientific view based on deeply flawed economics.

Entity Status

And as Hessen has pointed out,

Read more>>

President Obama says Americans want to go to work. Unemployed Americans don’t want a handout he says, each time he proposes extending unemployment benefits. Republican Senate leaders, he said, “are advancing a misguided notion that emergency relief somehow discourages people from looking for a job should talk to these folks.”

“That attitude, I think, reflects a lack of faith in the American people,” says Mr. Obama. “Because the Americans I hear from, in letters and town hall meetings, Americans like Leslie and Jim and Denise — they’re not looking for a handout. They desperately want to work. It’s just, right now, they can’t find a job.”

Out-of-work aesthetician Leslie Macko, former body-parts manager Jim Chukalas, and unemployed maintenance supervisor Denise Gibson joined the president as props for a photo op and speech fodder last summer. “These are honest, decent, hardworking folks who have fallen on hard times through no fault of their own and who have nowhere else to turn except unemployment benefits and who need emergency relief to help them weather this economic storm,” said the President.

Depending upon which government unemployment figure you follow, nearly one in five Americans is unemployed. Yet at harvest time farmers are finding that the only willing labor has to come from a nearby penitentiary.

In Idaho, farm labor is so scarce, convicts from the minimum-security St. Anthony Work Camp are picking, sorting and packing spuds for $7.50 an hour and happy to have work outside the prison walls. “The best part is you have the influence of the real world, which eventually we’re all going back to,” said Thomas Alworth, a 36-year-old convicted of grand theft by possession.

Convict labor in Arizona is up 30 percent this year, with Arizona’s tough immigration law a primary reason. “The crackdown on immigrants just makes it so hard” to find workers, said Richard Selapack, vice president for labor contracts at the Arizona Department of Corrections.

Frank van Straalen, COO of Eurofresh Farms in Wilcox, Arizona, says very few native-born Americans apply for jobs in his greenhouses and those that do typically quit.

Jerry Spencer had the same experience at his tomato farm north of Birmingham. After his Hispanic workers left with the passage of Alabama’s new immigration law, he thought he’d recruit unemployed U.S. citizens to pick the tomatoes. However, “jobless resident Americans lack the physical stamina and the mental toughness to see the job through,” Spencer told the Associated Press.

Tomato farmer Helen Jenkins says, “It’s just not working,” referring to the new law. “You can’t get the (American) workers out here to do the work that the Hispanics were doing. They’re just not capable.”

Lana Boatwright, another tomato farmer, told the AP that many of the people she has tried to hire were concerned about losing their government disability payments if they went to work for her.

Mr. van Straalem, a third of whose workers are prisoners, told the Wall Street Journal, “We’re fortunate, we’re near a prison here.”

Restaurateurs and farmers in Georgia are having trouble finding help since the passage of HB 87 in April. The labor shortage left crops rotting fields this spring and summer at a cost of $74.9 million to Georgia farmers. The farmers said they lacked 40 percent of the total work force they needed.

Today, the Bureau of Labor Statistics released producer price index (PPI) data for September. In the release’s Stage-of-Processing Analysis section was this,

Finished foods: Prices for finished consumer foods climbed 0.6 percent in September, the fourth consecutive monthly increase. Accounting for over eighty percent of the September advance, prices for fresh and dry vegetables increased 10.0 percent.

Last week I was a Guest panelist on This Week in Law, Episode 133, entitled “Beyonce, Bad Laws, and Breastaurants.” The two hosts and fellow guest panelist were all lawyers. We had a wide-ranging two-hour discussion about a variety of legal and policy matters, including a number of IP problems covering patent, copyright, trademark, and even trade secret. We also discussed the Occupy Wall Street movement, Apple’s use of IP to squelch clones and competition, copyright threats against Beyonce for her dance moves, and many others as indicated by the links on the episode’s show notes.

The video is below; it’s also on the TWiL page for this episode; you can also subscribe to the audio or video podcast for this show; here’s their FaceBook page.

A few more backup links and points below about some of the issues discussed.

• At one point we got into a discussion of Obama’s use of a signing statement to approve ACTA as an “executive agreement” (see ACTA, Executive Agreements, and the Bricker Amendment), I noted that under international law, violation by a host state of the citizen of another state gave rise to a right for the violated citizen’s home state to use military force against the host state. I remarked that one danger of internationalizing intellectual property by means of executive agreements and treaties is that it could give western nations an excuse to military force against countries that allow piracy. However, this was a bit of an overstatement since, as I explain in International Investment, Political Risk, and Dispute Resolution: A Practitioner’s Guide (see this excerpt), this type of “gunboat diplomacy” is ostensibly no longer permitted since the founding of the UN in 1945: “Today, some investors hailing from militarily and politically powerful States might favor the threat or use of force to obtain restitution or compensation for expropriated property. Such an option is no longer available, however, due to fundamental changes in international law and politics. In particular, the United Nations Charter has since 1945 prohibited the use of force to resolve disputes, except in the case of self-defence. Today, it is generally accepted that a State may not use force against another State in response to a taking of the property of one of its nationals.”
• The quote I mentioned about the problem with making law by legislation is by James Carter, who wrote, in 1884, in opposing the attempt to codify New York’s common law:
  

  At present, when any doubt arises in any particular case as to what the true rule of the unwritten [i.e., judge-found, common-law developed] law is, it is at once assumed that the rule most in accordance with justice and sound policy is the one which must be declared to be the law. The search is for that rule. The appeal is squarely made to the highest considerations of morality and justice. These are the rallying points of the struggle. The contention is ennobling and beneficial to the advocates, to the judges, to the parties, to the auditors, and so indirectly to the whole community. The decision then made records another step in the advance of human reason towards that perfection after which it forever aspires. But when the law is conceded to be written down in a statute, and the only question is what the statute means, a contention unspeakably inferior is substituted. The dispute is about words. The question of what is right or wrong, just or unjust, is irrelevant and out of place. The only question is what has been written. What a wretched exchange for the manly encounter upon the elevated plane of principle!

• I mentioned the tension between antitrust and patent/copyright law; more discussion of this issue can be found in endnote 1 here;
• We discussed the America Invents Act; I’ve since completed a detailed writeup about this: The American Invents Act and Patent Reform: The Good, the Meh, and the Ugly;
• Concerning our discussion of the copyright lawsuit against Beyonce based on her dance moves in a music video, see also my posts: Copyrights and Dancing, Copyrighting Dance Steps–The Death of Choreography, and others at The Patent, Copyright, Trademark, and Trade Secret Horror Files. On the show we briefly discussed also Pro wrestler sues rapper over hand gesture: Yet Another Example of how Intellectual Property is Partial Enslavement.