New School Politics

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In the past couple of days the largest home insurer in the US, State Farm, announced that it will stop writing new policies for homeowners and small businesses in Mississippi. 

Bob Trippel, senior vice president, explained, “It is no longer prudent for us to take on additional risk in a legal and business environment that is becoming more unpredictable.” Essentially, the gulf coast has emerged as an area of exorbanite risk where a cost far outweighs the potential benefits of doing business. As such State Farm is making a reasonable business decision to take their capital elsewhere.

Consequentially they could now face the specter of government compulsion as Reuters reports:

Mississippi’s attorney general said Friday he would propose legislation to force State Farm, the largest home insurer in the United States, to continue writing new policies in his state.

State Farm has said it will stop writing new policies for homeowners and small businesses in Mississippi following a legal battle over damage claims in the state from Hurricane Katrina in 2005.

Attorney General Jim Hood, at a press conference, condemned the company’s decision, calling State Farm a “robber baron” and accusing it of “decadent actions” in Mississippi …

Hood said Friday that he had asked Mississippi Gov. Haley Barbour and Insurance Commissioner George Dale to issue emergency orders requiring insurance companies to continue writing home policies until the state legislature can act. He said he had not had any response from either Barbour or Dale.

State Farm immediately fired back, saying Hood was part of the problem.

“This is a remarkable response to what was just a business decision, but it does underscore the legal and political challenges faced in Mississippi,” Fraser Engerman, a spokesman for State Farm, told Reuters. “We want to continue to serve our customers in Mississippi, but it seems some are intent on making that more difficult.” …

Under Hood’s proposed legislation, a company selling auto insurance in Mississippi, and both auto and home insurance in other states, would be required to also sell homeowner insurance in Mississippi.

State Farm has said it wants to sell auto insurance - but not new homeowner policies - in Mississippi.

Every proposition that the Attorney General has put forth now is an immoral threat to State Farm’s liberty. State Farm is entitled to the property they own by right. They earned the capital they have accumulated and therefore are entitled to venture it as they please and where they please. Mr. Hood did not earn it, he cannot order them what to do with it; Gov. Barbour did not earn it, she cannot order them what to do with it; the people of Mississippi did not earn it, they cannot order them what to do with it; it was the freedom of the State Farm that produced the service they provide and it is their right to do with it as they please.

The insurance that State Farm makes available to people in Mississippi, as well as all of the United States, was only made possible by them pursuing their own self interest and attempting to make a profit. The mind power that it takes to make a billion dollar corporation out of nothing is enormous. The exercise of free will and ingenuity that manifests itself in State Farm is a testimite to the power of the reason. But reason is a volitional faculty and does not function under compulsion. State Farm insurance was therefore a byproduct of the free market system; it would not have come from nothing to where it is today if it faced the constant duress of central planning.

And yet, Attorney General Hood is attempting to create such a business environment for insurance companies in his state and simultaneously expects them to continue producing insurance to individuals and small businesses. If successful in his agenda, Hood will soon find out the consequences of not allowing the rational mind to think freely–either State Farm will be forced to plunder its capital in the state or it will flee entirely from Mississippi. But no matter what we will see freedom and wealth of more than one party suffer. Not only will State Farm Insurance see its business freedom and bottom line reduced, but the people of Mississippi will simultaneously have their right to buy insurance from whoever is willing to sell it taken away and the supply of insurance available to them diminish.

Popularity: 22% [?]

Losers like me who have been paying close attention to the 2008 presidential race, including the polls, since at least two years before the election are already beginning to feel frisky. Looking at the polls (yes, I watch the polling 340 days before the first primary vote is cast) I noticed a glaring hole in the opinion of each party to date: about 10% of the each party says they support a candidate who is not running. For the Democrats, Al Gore (frm. VP); for the Republicans, Newt Gingrich (fmr. Speaker of House).

Click here for the Democrat’s polls. Click here for the GOP polls.

The point of this observation is that a significant portion of each party is swayed towards a particular point of view that will be up for grab assuming that their choice does not run, which in all likelihood (moreso for Gore) they will not. In two crowded primaries (primaries are always crowded) 10% is a large chunk of the vote, and it would be gold if any one of those running could pick up a large portion of that persuasion.

Now, the Newt constituency is probably less significant for a couple of reasons: (a) that Newt has a less ideologically defined following and (b) that Newt himself may run.

The former Speaker’s support comes from an array of strong, base (but not necessarily evangelical) conservatives–of the inside-the-beltway variety–who likes him because he has experience and is an intelligent conservative politician. But at the same time Gingrich is pragmatic and not even as ideological as others running within his own party. There is probably not any one candidate who would take a very large portion of Newt’s following, nor is there any one thing that any of the Republican candidates could do to take it. There are any number of capabilities not limited to Giuliani and/or McCain taking fiscal and/or hawkish conservatives, Huckabee or Brownback taking social conservatives, Duncan Hunter taking the boarder-enforcement interests, or even Ron Paul taking the libertarian wing of Newt’s constituency.

As we will see, a major theme of the GOP primary will be contenders jockeying for the support of institutional conservatives. Gingrich’s 10% represents much of this group. And if no one is able to court those voters it is not out of the question that we could see a late, dramatic entry from Speaker Gingrich for the Republican nomination.

On the democrat’s side, the Gore constituency may be far more important for the opposite reasons that Newt’s is probably less significant. Namely that (a) Gore’s following does have a definitive identity and (b) Gore will not run.

While Gingrich’s level of support makes more sense, because he has not ruled out a run, Gore has repeatedly said that he will not run. Why then has he consistently received 10% of the support in the polls including 14% in the latest poll (USA Today/Gallup)? Its because Gore’s following represents a devoted ideological interest: environmentalists. The environmentalist base is loyal and devoted–so devoted their support of the Green Party ironically cost Gore the election in 2000–and growing. Strangely, despite all the commotion about global warming none of the democratic candidates have really pushed the environmentalist stance to appeal to the green vote which is why Gore is still receiving such a large fraction in the polls. If any one of the Democrat candidates does go strong for the environmentalist vote it could make a very significant increase in support (try 7-8%), possibly big enough to put them over the top. Still, Mrs. Clinton’s lead appears to be very big and even an 8% for Edwards or Obama may not be enough.

Popularity: 12% [?]

Recently, Nick Gisburne posted a nine minute video on YouTube consisting of nothing but direct quotes from the Koran. The video is straightforward and uses Islam’s own words in implicating it as the violent religion that it is. YouTube in turn removed the video from the web site, and then put it back in the face of criticism.

Of the incident, Jason Miller writes:

At YouTube, you can say pretty much whatever you want, as long as it’s not about Islam. If that’s not true, YouTube user Nick Gisburne begs to differ after his account – his entire account – was deleted for its “inappropriate content.” What exactly did he say? Well, nothing really. He let the Koran speak for itself.

Everywhere in Europe and America even mentioning Islam in any sense that may imply something is inherently wrong or awful with the religion is immediately censored. Why don’t America and Europe just give up and surrender to the terrorists?

Every Muslim is not a terrorist, but most terrorists are Muslim.  It does not matter if they are Sunni or Shia. They hate us, and we should repay them in kind. I am so sick of the ACLU and other organizations protecting the rights of these fanatics. If you blow up children, you have no rights. Maybe the Jews should start blowing up buses so that Amnesty International treats them the same as Palestinians.

Did you know that the fifth most common name in England and the most common new baby name in Denmark is Muhammad? When will the world wake up to the fact that modern Islam is the biggest threat to western civilization in our history? Can we stop all pretending and actually fight these evil heathens?

Now some of the people on here will comment that they are not heathens or that Islam is not evil. I suppose they are right. Cutting off your daughter’s clitoris to keep her from committing adultery, beheading a son who marries a non-Islamic woman, cutting off hands and feet for offending the Koran, stoning non-believers and women who expose their skin in public to death, flying airplanes into buildings, blowing up school buses, and eating people alive is behavior that we as members of civilization should accept.

Popularity: 15% [?]

It has been less than a month since the new Congress passed a minimum wage increase and already employers and employees are bearing the brunt of it. As I said before it was passed in my article “Abolish the Minimum Wage”, it is not as if this should take us by surprise–as the fact that a minimum wage increases unemployment is only economically logical in accordance to the law of demand–but it only better illuminates the irrationality of politicians who claim that government decrees will make everyone richer while simultaneously masquerading around as if they know economics.

With Arizona as a case-study, The Arizona Republic published an article on the early effects of the new miminum wage:

Mark Messner, owner of Pepi’s Pizza in south Phoenix, estimates he has employed more than 2,000 high school students since 1990. But he plans to lay off three teenage workers and decrease hours worked by others. Of his 25-person workforce, roughly 75 percent are in high school.

“I’ve had to go to some of my kids and say, ‘Look, my payroll just increased 13 percent,’ ” he said. ” ‘Sorry, I don’t have any hours for you.’ ”

Messner’s monthly cost to train an employee has jumped from $440 to $580 as the turnover rate remains high.

“We go to great lengths to hang on to our high school workers, but there are a lot of kids who come in and get one check in their pocket and feel like they’re living large and out the door they go,” he said. “We never get our return on investment when that happens.”

Microeconomic case-in-point: if you a commodity that a business buys becomes–in this case by means of government price fixing–more expensive, they will buy less of it. It is not as if this is tricky stuff; Econ 101–supply and demand–you all know how it works.

And in the case of a price floor, it is the cheapest of a given commodity that will suffer. Among labor this generally encompasses part time and very poor workers, especially teenagers, which explains why for instance one in three black teenagers is unemployed (compared to one in nine in 1948). The AZ elaborates:

For years, economists have debated how minimum-wage increases impact the teenage workforce.

The Employment Policies Institute in Washington, which opposed the recent increases, cited 2003 data by Federal Reserve economists showing a 10 percent increase caused a 2 percent to 3 percent decrease in employment.

It also cited comments by noted economist Milton Friedman, who maintained that high teen unemployment rates were largely the result of minimum-wage laws.

While I am not a fan of using statistics in making economic judgments (theory must always preeminent) I think the plethora of statistical data of the damage a minimum wage can do to employment is in and of itself enough to convict it of economic ignorance run amuck.

The article gives more examples of small businesses and young adults suffering:

Tom Kelly, owner of Mary Coyle Ol’ Fashion Ice Cream Parlor in Phoenix, voted for the minimum-wage increase. But he said, “The new law has impacted us quite a bit.”

It added about $2,000 per month in expenses. The store, which employs mostly teen workers, has cut back on hours and has not replaced a couple of workers who quit.

Kelly raised the wages of workers who already made above minimum wage to ensure pay scales stayed even. As a result, “we have to be a lot more efficient” and must increase menu prices, he said.

While most of the state’s 124,067 workers between the ages of 16 and 19 made well above $5.15 per hour before the change, the new law has created real-life economic opportunities.

The worst economic effects of this are that it is not even like governments spending that are harmful to capital accumulation. The minimum wage is at heart a regulation that does not even divert capital (like government taxation would), but rather stops it from being utilized and grown in the first place. The rate of unemployment we see rise and prices that we see inflated will be the consequence of the government stopping the economy from operating to the full capacity that its resources allow.

And the greatest damage, ironically, is done to the youngest and the least fortunate among us, who need employment the most–not just for financial reasons either, but to gain valuable experience in the workplace during their formidable years.

Popularity: 12% [?]

The news is beginning to splash across the blogosphere and the AP wire that an agreement has been reached with North Korea about its nuclear programs.  Years of negotiations have failed to yield an agreement. After talks fell suspect to failure earlier in the week, noone expected an agreement in the coming days.  Negotiators have, however, proved skeptics wrong.  Assistant Secretary of State Christopher Hill notes his jubilance at the agreement, claiming that he’s “encouraged by this that we were able to take a step forward on the denuclearization issue.” 

The end of a 16-hour day full of negotiations has delivered an agreement.  The mainstream media has sparse details on the agreement, and news agencies like CNN are calling the agreement tentative.  Chinese Foreign ministry Spokesman Qin Gang followed up with a little bit more information, detailing that the parties “still have to make further consultation discussions so as to confirm the progress we made.”  Negotiations begin again tomorrow at 10:30AM Korean time, which equates to 9:30PM Monday ET. 

The initial enthusiasm may be short lived, however.  Several of the nations involved in the talks, including Japan, expressed doubt at the agreement.  Kenichiro Sasae, chief envoy from Japan, said it was “too early to tell” if the agreement was one that would be satisfactory to all parties.  North Korea’s demands were viewed as slightly excessive by South Korea and Japan.  It will be interesting to see how much of a compromise North Korea has made in order to reach this agreement.  The Arms Control Associaton provides a concise history of the conflict.  Previous negotiations with North Korea have resulted in successful agreements that broke apart because of North Korean noncompliance.  The original “Agreed Framework” can also be viewed courtesy of the ACA.  The agreement broke down in late 2002 after North Korea admitted to a nuclear program after being confronted with evidence by the US. 

Needless to say, any sort of agreement with the North Koreans is big news for the American people and for the entire world.  The dismantling of the North Korean nuclear program leaves one country left on the US “Axis of Evil”: Iran.  News about North Korea’s nuclear program died down after their claimed underground nuclear test on October 9, 2006.  Tensions with Iran were high this week as the US accused the country of arming insurgents in Iraq.  Newsweek did a special on the looming conflict with Iran, with a cover touting “America’s Hidden War with Iran.”  The Guardian, meanwhile, cited examples of US provocations.  A second US battle group was sent to the Gulf in anticipation of a conflict with Iran.  The report concluded that the “present military build-up in the Gulf would allow the US to mount an attack by the spring.”  Iran has vehemently dismissed American accusations and the Washington Post reports today that Bush has “softened his rhetoric on Iranian relations.”  In the report, Ahmadinejad calls for peace,

“We shy away from any kind of conflict, any kind of bloodshed,” Ahmadinejad told ABC’s “Good Morning America.” “As we have said repeatedly, we think that the world problems can be solved through dialogue, through the use of logic and a sense of friendship. There is no need for the use of force.”

Bush Softens Rhetoric on Iran Relations - washingtonpost.com

While the conflict with Iran seems far from reconciliation, the North Korean problem appears to have been solved, if only for a brief period of time.  The American people should expect to hear a lot about Christopher Hill’s success in North Korea, as it’s one of the few diplomatic successes the US government has had abroad in recent years.  We’ll be back with more commentary as more news is available.

Avid readers can watch for news from the wires, papers, blogs, and more at Breitbart.

technorati tags:iran, northkorea, christopherhill, kimjongil, us, nuclear, nuke

Popularity: 29% [?]

Barrack Hussein Obama is on fire. I may disagree with his ideas on policy, but I cannot deny that he is receiving enormous amounts of attention. One of the most fascinating aspects about his campaign is his rock star status not just in the United States, but overseas. A friend of mine was in Amsterdam on Thursday and said that many of her colleagues were enthralled with Obama. They asked her endless questions about the new candidate (most of them struggled to pronounce his name). On a side note, when my friend was in Amsterdam no one had heard of Rudi Giuliani and only knew of John McCain. In addition, Australian Prime Minister John Howard blasted Obama’s Iraq plan to withdrawal American soldiers. It is stunning for an American candidate with no executive experience to receive international attention on this scale, especially almost two years before the election.

John Howard’s words did help give the American people an insight into Obama. Obama responded to Howard in a diplomatic and polite fashion and even prompted the Australian prime minister to increase the strength of his nations force in Iraq if he viewed the “good fight” to be so important.

Obama is a great speaker, there is no doubt about that, but many say that his weakness may come in his inexperience in governing. What most American’s forget is that neither John Edwards or Hillary Clinton have had any real executive experience; besides Hillary Clinton’s experience as first lady none of the democratic nominees have any foreign policy experience. Where Obama may prove to have an advantage in international diplomacy is in his race and ethnicity. The Europeans all already love Obama (mainly because they hate Bush) and he may find that his background can be used as leverage when conducting diplomacy in Europe and also the Middle east, and Africa.

The Europeans closet racism (or as they call it “multiculturalism”) would be a major advantage for any American president of African descent. He also has an additional advantage over his democratic counter-parts in Europe; he is the only one of them who could tell the Europeans that he has always been against the war in Iraq. Obama would have two major advantages over Hillary Clinton in the Middle East. Anyone who ignores the impact of Hillary’s gender on foreign policy is naive. While most Americans view women as equal, most of the world does not. In the Middle East using a woman to conduct foreign policy can be a mistake (see Condoleezza Rice and prior Madeleine Albright. Her Jewish heritage helped to show the Muslim world that we were objective with our Israel-Palestine policy). Muslim men, even moderate or progressive ones will look down upon a female American president and will view her to be weak. By contrast a charismatic, articulate, male of Muslim descent will be able to sit eye to eye with his Middle-Eastern counterparts. In Africa, Obama would be seen as an idol, he could initiate a fundamental and positive shift in the current African socio-economic decline.

Obama may not have the money that Hillary has, but his charisma, anti-war stance, his non-elitist image, and the characteristics he was born with may be enough to steer the nomination his way. In the past few days I have had to re-evaluate my position on Obama and have decided that he could be more than a vice presidential candidate, he has a good shot at the presidency.

Popularity: 13% [?]

I think its safe to say that my warning last week about utilitarian socialism in Venezuela is perpetuating itself. Earlier today Venezuela centralized political power to the brink of dictatorship. The Venezuelan congress voted to sacrifice its power legeslative check to President Hugo Chavez so to expedite the nationalization of key sectors of the economy in the broader movement towards socialism.

Al Jazeera reports ‘Chavez granted rule by decree’:

Venezuela’s congress has granted Hugo Chavez, the president, powers to rule by decree–enabling him to push through plans to nationalise key industries as part of his “socialist revolution”.

The special powers, which las for 18 months, will enable him to transform 11 broadly-defined areas including the economy, energy, and defence.

Roberto Hernandez, the congressional vice-president, said: “We in the national assembly will not waver in granting President Chavez an enabling law so he can quickly and urgently set up the framework for resolving the grave problems we have.”

Concentrating power, it must be said, is not in and of itself evil but it leaves room for any extent of evil to be committed. The reason we have checks and balences in our constitution is to keep the government in line, and to power from being centralized on a single whim. Making Chavez, in effect, a temorary autocrat is not dangerous just for the reason of puting the fate of every Venezuelan’s freedom soly in his hand, but it is outright suicidal when we see why it is being done.

The same article observes that,

The president has already said that he will use the law to decree nationalisations of Venezuela’s largest telecommunications company and the electricity sector, impose new taxes on the rich and greater state control over the oil and natural gas industries.

Chavez’s supporters deny the law constitutes an abuse of power and say radical steps are necessary to accelerate the creation of a more egalitarian society.

The opposition accuses Chavez of being a tyrant in the making, taking a slow approach in following Fidel Castro…

Once again we see the corolation between the tyrannical means (dictatorship) and the tyrannical ends (socialism). Nor is it a suprise that Chavez has received the ardent support of his people in concentrating his power. Pure democracy and pure autocracy are not opposites but they are conceptually the same, insofar as they have in common an abscence of checks on power. In an unlimited democracy, where the majority rules, there is no force stopping the majority from doing anything they want; in a autocracy there is no force stopping what the autocracy wants. In Venezuela the majority has perpetuated the move to socialism and also excused Chavez’s consolidation of power in doing so–either way, there was never any check on power.

Too often Democracy is misconceived as an inherent value, but it is not. President Bush, for one, has perpetuated this idea in his foreign policy and he continues to apply the same idea to Venezuela:

 George Bush, the US president, said Chavez’s expanded powers and possible plans to nationalise key economic interests left him worried about Venezuelan democracy.

“I’m concerned about the Venezuelan people, and I’m worried about the diminution of democratic institution(s), as well as nationalisation efforts that may or may not be taking place,” Bush told Fox News television.

Asked whether Chavez, a perennial thorn in Washington’s side, posed a military threat to US interests, Bush replied: “I think the bigger threat is the diminution of democratic institutions.”

But in the same way that he was mistaken in thinking that democracy could bring freedom to Iraq, he is also mistaken in thinking that they serve as cause and effect, respectively, in Venezuela. Whether or not a law is passed by a majority or by a single ruler does not change whether it is right or wrong. Freedom can as easily be destroyed by democracy as it can by dictatorship. There is no inexorable connection between the policy and the mode of government, and thus the policy–whether or not a country is free–must be what is judged in evaluating the morality of a government. The evil is not in the means of government–although it is indicative of it; the evil we see is in the progressively totalitarian ends which are being perpetuated by unchecked power (first democracy, now dictatorship). Its about time the world recognized that socialist governments such as Venezuela are immoral by their nature, whether or not a majority of the country’s population agrees.

Popularity: 16% [?]

America’s military has been off limits to homosexuals for years.  As part of the famed “Don’t Ask, Don’t Tell” policy highlighted in American policy throughout the years and proposed by Bill Clinton and Colin Powell, gays have been able to serve as long as they do not disclose their sexual orientation.  The chronology of Don’t Ask, Don’t Tell shows the onslaught of criticism the program faced both when it was passed and in the immediate years after.

The question, however, remains:  Why shouldn’t gays be able to serve in the military?  Other minorities fought for years to be able to serve alongside their fellow Americans.  Their victory led to the integration of the military.  Yet homosexual service in the military has been frowned upon since the inception of the United States military.  The dismissal of homosexual soldiers is hurting our military.  The SLDN notes that “during every major military mobilization, gay discharges have dropped.”  Clearly, the military needs our homosexual soldiers.  If not, why aren’t they being dismissed at the same rate during conflict periods?  

The SLDN, along with other legal and gay rights organizations, is ramping up their fight for the repeal of the policy.  This time, Congress isn’t ignoring their pleas for equality.  Last session’s bill H.R. 1059 [commonly referred to as the Military Readiness Act of 2005], sponsored by Representative Martin T. Meehan, calls for replacement of the “Don’t Ask, Don’t Tell” policy with “a policy of nondiscrimination in the military on the basis  of sexual orientation.”  Meehan, along with 122 other cosponsors, supported the bill as it worked its way through the 109th Congress.  Unfortunately, the bill wasn’t passed by the end of the session. 

Representative Gary Ackermann (D-NY) made big news Wednesday afternoon during a Congressional session with Secretary of State Condoleeza Rice.  Earlier in the month, the Secretary had expressed concerns about not having enough translators in Iraq.  Ackerman fired back, telling Rice that she “might find some of those competent people among those who were recently unemployed over the past several years,” referring to the gays that had been discharged from military service in recent years.  A December 2006 poll has helped to give more backing to supporters of the Meehan policy.  The Zogby poll, available online as a PDF here, shows that 73% of those polled in the military say they are personally comfortable in the presence of gays and lesbians.  Only 20% said they were uncomfortable.  Meehan responded to the survey with strong words, claiming

“These new data prove that thousands of gay and lesbian service members are already deployed overseas and are integrated, important members of their units. It is long past time to strike down ‘Don’t Ask, Don’t Tell’ and create a new policy that allows gays and lesbians to serve openly.”

Zogby International

A Boston Globe poll from May 2005 shows that 79% of American civilians don’t mind gays serving in the military.  In a New York Times editorial, General John Shalikashvili reversed his course

I now believe that if gay men and lesbians served openly in the United States military, they would not undermine the efficacy of the armed forces. Our military has been stretched thin by our deployments in the Middle East, and we must welcome the service of any American who is willing and able to do the job.

Op Ed: Second Thoughts on Gays in the Military

Shalikashvili imagines a day when “gay men and lesbians will no longer have to conceal who they are and the military will no longer need to sacrifice those whose service it cannot afford to lose.” America is ready, and the wheels have just begun turning. 

Representative Ackerman helped to fuel the debate once again during hearings earlier in the week.  His tongue-in-cheek rant has since become famous on the internet,

“For some reason, the military seems more afraid of gay people than they are against terrorists, but they’re very brave with the terrorists. … If the terrorists ever got a hold of this information, they’d get a platoon of lesbians to chase us out of Baghdad.”

The Frontlines: Ackerman’s Lesbian Platoon

The military must accept gays and lesbians, and the time for the integration is now.  Marty Meehan’s “Dear Colleague” letter has begun circulating around Congress and he plans to introduce a bill overturning the old “Don’t Ask, Don’t Tell” policy as soon as possible.  Meehan’s bill is crucial to the civil rights of homosexuals in this country and to the status of the military in the future. 

If you’d like to take action, SLDN and the Michael D. Palm Center have more information.

technorati tags:military, condoleezarice

Popularity: 39% [?]