Market Anarchist Blogs

The always interesting Robert Darnton has an interesting piece in the New York Review of Books entitled Google & the Future of Books, in which he essentially argues for a reigning of copyrights, combining the ideas of a shorter term (28 years after creation is what Darnton believes is the platonic ideal, as opposed the current 70 years after author's death) with some wishy-washy democratic platitudes that I can't seem to shake much concrete meaning out of.

It's an interesting essay, though he makes a very common mistake, in automatically associating intellectual property rights with free market ideals:

But we, too, cannot sit on the sidelines, as if the market forces can be trusted to operate for the public good. We need to get engaged, to mix it up, and to win back the public's rightful domain.

In a perfectly free market, clearly there would be nobody to enforce intellectual property rights. Though as Boldrin and Levine explain, content creators still have a significant advantage over the imitators, and innovation in an IP-less world doesn't look like it would suffer.

The story about Obama's half-brother in Kenya getting busted for smoking pot has gotten a lot of play, but the Guardian's article is the first I've read where the author had enough sense to ask why rather than just who, what, where, and when:

Although Kenya is strict about drug possession, there does not appear to be any current police campaign to crack down on usage. The officers who arrested George did not disclose why they searched him, although they are often conducted in the hope of extracting a bribe.

And this certainly isn't the first time that George Obama's been used for his fame:

Last year, during the election campaign, the Italian edition of Vanity Fair claimed to have "found" George Obama, after meeting him at his step-grandmother's home in Kogelo, western Kenya. The report claimed - controversially - that he lived on a dollar a month, and that he was ashamed to be an Obama.

While he is poor and lives in ramshackle accommodation, George is in the same position as well over a million other people who live in Nairobi's slums. Before the US presidential election, he said that he saw no reason why Barack Obama should support him financially; he was content with his life and could provide for himself. That did not stop Jerome Corsi, the right-wing US author of The Obama Nation, from travelling to Kenya in the hope of presenting a $1,000 cheque to George. Fortunately for Corsi, whose stunt was unlikely to have gone down well in Huruma, he was quickly deported.

Now that neo-conservative Bill Kristol has vacated his NY Times op-ed slot, there has been some loose talk about getting a libertarian to replace him.

In my opinion, the Times could do no better than steadfastly principled libertarian Wendy McElroy.

If you agree, please politely make the request in your own words to the NY Times editorial page editor: editorial@nytimes.com

Limited liability incorporation is not a natural free market occurrence. Limited liability incorporation encourages dishonest behavior by management of a nearly insolvent corporation, such as Bear Stearns, Lehman Brothers, GM, Ford, AIG, FRE, and FNM. The incentive is for management to cover up problems and go into a bigger and bigger debt hole.

Limited liability incorporation always gives management and shareholders a free put option to declare bankruptcy and cheat creditors. The equity of a nearly insolvent corporation trades more like a call option, with strike equal to outstanding debt, rather than like equity.

Combined with a central bank credit monopoly and negative real interest rates, limited liability incorporation encourages the management of a corporation to load up on debt. If there is an inflationary boom, then there are massive profits, paid by everyone else as inflation. If there is a recession/depression, then there is a bankruptcy filing. Either creditors are cheated or there is a State bailout, depending on the political connections of the creditors.

Further, "tort reform" means that, if there is a successful lawsuit against a corporation, then the compensatory and punitive damages are limited. Typically, the corporation is sued and not the individuals who committed the misconduct. Even if you sue the executives of the corporation, then the corporation typically reimburses the executives for their legal expenses and any loss.

The authors of the US Constitution were correctly very hostile to corporations. It took decades of bribing and lobbying to get the Supreme Court to legalize limited liability incorporation, which was a huge error. The 14th amendment was interpreted as justifying the rights of corporations. Limited liability incorporation is one of many ways that insiders loot and pillage.

Pro-State trolls say "Limited liability incorporation is a necessary perk to reward entrepreneurs and risk-takers!" For large corporations, limited liability incorporation is abusive for the reasons indicated above. For a small business owner or sole proprietorship, limited liability incorporation provides practically no protections. A small business owner typically has nearly all his wealth invested in his business. In the event of a lawsuit, if you're operating a sole proprietorship, then it's very easy to "pierce the corporate veil" and sue the owner directly. Limited liability incorporation provides protection and subsidies to management and owners of large corporations, but no protection to small business owners.

By reducing the risk of business owners, limited liability incorporation encourages dishonest behavior. By artificially reducing the risk of owning/managing a large business, the State subsidizes large businesses at the expense of small businesses.

Limited liability incorporation is not a natural free market occurrence. Limited liability incorporation is an artificial creation of a coercive government. In a true free market, management and owners are always personally liable for their debts. In the event of a negligence or misconduct lawsuit and victory, then management cannot declare bankruptcy to discharge the liability.

I have received quite a few comments regarding the 0 Issue of ALLiance. Comments, criticisms, suggestions, etc. have all been listened to and are helping shape the next issue. While I have been busy searching the left libertarian blogosphere for submissions, I am still looking for some new material.

The next issue will take a closer look at action/practice. How can we move towards a stateless society. What are some alternatives to the welfare state. I touched briefly on Mutual Aid Organizations, but what else is there? Have you written (or thought about writing) a Do It Yourself guide or primer that will help people live life a little more freely? If so, please consider submitting it to ALLiance. Submissions deadline is February 14, however this can be tweeked if you have a submission and need more time.

I can be reached at chris @ chrislempa.info (remove the spaces).

Also, there was a postponement on shipping out the hard copies. They were mailed out this week and should be arriving shortly. If you are interested in a hard copy please email chris @ chrislempa.info (remove the spaces).

Trigger warning. The video of a local news story, below, may be triggering for experiences of sexual violence.

When anarchists suggest that a civilized society can do without government or its cops, we are always asked how people in an anarchistic society would be protected from violent criminals like murderers and rapists. If we suggest that people could handle their own protection through consensual private arrangements — individual self-defense, cooperative community defense, or hiring out help, if need be — we are constantly told that we need monopolistic government control in order to ensure that professional police go about their policing in a way that’s transparent and accountable to the people.

In northern Ohio, a woman named Hope Steffey is suing the Stark County sheriff’s office and several of the deputies and prison guards working for them. Here’s why.

So, a gang of uniformed women and men, violently exercising the power of the State, pinned a screaming woman down on the floor of a jail cell and tore off her clothes to search her, over her screams of protest, while male guards were not only still in the cell, but in fact wrenching her arms behind her back, and then left her naked in the freezing-cold cell for six hours, in full view, without even a blanket to cover her body or keep herself warm. This was, of course, justified by means of unilaterally declaring Hope Steffey crazy, so that they could officially record that they had to inflict that kind of extreme violence and sexual humiliation on an imprisoned woman, over a period of hours — for her own good. Afterwards, when a local news station interviewed Hope Steffey, and aired video of what the cops and prison guards did, they ended up facing a series of unkind words about their character and professionalism. And here is how the dedicated public servants of the Stark County sheriff’s office have transparently and accountably responded the strains resulting from public exposure of their treatment of Hope Steffey:

CANTON — Stark County sheriff’s deputies who were vilified after a Cleveland television station aired video of them stripping a woman at the Stark County Jail have filed a lawsuit saying they are victims of one-sided reporting.

Last year, WKYC Channel 3 began airing reports on a lawsuit filed by a Salem woman who says she was strip-searched at the jail in October 2006. The reports included video of sheriff’s deputies and corrections officers pinning Hope Steffey to the floor of a jail cell and removing her clothes.

This week, those deputies — Kristin Fenstemaker, Laura Rodgers, Tony Gayles, Richard T. Gurlea Jr., Andrea Mays and Brian Michaels — sued reporter Tom Meyer, WKYC and its parent company, alleging defamation and invasion of privacy.

The lawsuit seeks damages of more than $25,000 and is assigned to Stark County Common Pleas Judge Charles E. Brown Jr.

—CantonRep.com (2009-01-30): Deputies sue TV station over reports about woman stripped naked

The lawsuit my seem obviously retributive; it may indeed seem like a thuggish attempt to silence criticism by shooting the messenger. But the strip-searchers would like the press, and a judge, to consider how hard it’s been on them, having their privacy invaded like that.

When you write about politics — and the politics of policing, especially — the problem is that, if you try to write anything more articulate than just expressing how much the whole thing makes you want to spit nails, you’ll soon find that the usual tools of satire, or even simple sarcasm, end up useless: the facts themselves, just as they are, constantly outstrip any sort of ridicule, no matter how over-the-top, that you could possibly craft.

See also:

• GT 2008-02-05: Rapists in uniform
• GT 2008-03-07: Rapists in uniform #2: four more women come forward
• GT 2008-03-08: In Their Own Words: Just following orders edition
• GT 2008-05-10: Rapists in uniform #3: a sixth woman comes forward
• GT 2008-06-23: We need government cops and government courts because private protection forces and private arbitrators would be accountable to the powerful and well-connected instead of being accountable to the people. (#2)
• GT 2008-11-13: Rapists in uniform #4: Standard Operating Procedure
• GT 2008-09-14: Omerta

The New Jersey Alliance of the Libertarian Left website recently underwent an overhaul. It still needs a little work, but I’ve deemed it acceptable for public consumption. Of particularly global relevance is the resource page, which is full of downloadable left libertarian and market anarchist propaganda, some of which would be of interest to folks of other anti-authoritarian persuasions.

I was watching the Communism Channel (CNBC) and saw another hilarious joke. They were talking about a proposed law where Congress would give judges discretion to change the terms of mortgages instead of foreclosing.

The analyst/comedian said "If Congress interferes with private debt contracts, that sets a very damaging precedent. The contract between borrower and lender is sacred, and the State must not interfere!"

My reaction was "ROFL". Can you guess what I was thinking of?

In 1933, President Roosevelt defaulted on the gold-redeemability of the US dollar and confiscated all the gold from US citizens. He then devalued the dollar/gold from $20/ounce to $35/ounce. (Even though US citizens were barred from owning gold, foreign central banks could still redeem their paper dollars for gold.)

Anticipating a default on the US dollar, many private debt contracts contained a "gold clause". A gold clause said "If Congress devalues the dollar relative to gold, then the amount of interest/principal due repaying the loan increases proportionally." President Roosevelt, Congress, and the Supreme Court ruled all these gold clauses invalid. In other words, the State breached *EVERY SINGLE* private debt contract that existed in 1933.

In the present, you don't hear of anyone using gold clauses. I don't know if they're outright illegal/unenforceable, or that individuals don't have the negotiating leverage to ask for one when dealing with a large corporation. (I tried looking up the law, but it was unclear.)

Whenever the Federal Reserve or Federal government inflates the money supply, they are interfering with *EVERY* private debt contract. As an individual, it does not make sense for me to make another individual an FRN-denominated loan. If I lend you money at 6%, I'm going to get ripped off by inflation. If I put a gold clause in my loan, I'm charging you an extortionate implied interest rate. Banks can lend at 6%, because they merely borrow from the Federal Reserve at the Fed Funds Rate (currently 0%-0.25%), pocketing the spread times their leverage ratio.

When the State manipulates the money supply, it interferes with the ability for everyone except financial industry insiders to raise capital to start a business. A corrupt monetary system means that the average person is always the slave of the bankers. Individuals don't have the magic money-printing power that banks have.

Suppose you take out a mortgage at 6%, anticipating 10%-20% inflation and a corresponding boost in housing prices. You are making a rational economic decision. The State, via the Compound Interest Paradox, causes a bust. Instead of 10% inflation, there is temporary 20% deflation. Instead of borrowing at an interest rate of -4%, you actually were borrowing at 26%. During a recession, individuals may lose their jobs, making them unable to pay their mortgages.

During a recession, individuals who load up on leverage lose everything. Insiders always qualify for a bailout. As an individual, you lose your downpayment and your house. All the labor you spent earning your house downpayment was stolen by the bankers.

The mainstream media says "Rule of law is important! If someone defaults on their mortgage, then the police should violently kick them out of their house! No exceptions!" When you realize that the financial system is one big fraud, you realize that police enforcing mortgage foreclosures are terrorists. It is a statistical consequence of the rules of the monetary system that a certain percentage of borrowers will lose their homes during each economic bust. You could argue "Those were the least efficient workers!", but a corrupt system that guarantees a certain percentage of people will lose everything.

Even if I have no mortgage, I am still subsidizing the financial industry via inflation. Suppose I maximize the leverage on my mortgage, refinancing every time housing prices rise. Then, I will lose everything during the next recession/depression.

A debt contract with a bank is not a sacred contract. It's an invalid no-interest contract. In order for a contract to be valid, both sides must contribute something of tangible economic value. When you borrow from a bank, the bank merely prints new money and loans it to you. A bank does no real work when it lends money. As an individual, you have to perform work to get money to repay the principal and interest. That money must have ultimately come from the bank. Due to the Compound Interest Paradox, there will be an occasional crunch when individuals are scrambling to raise money to pay off their debts.

There was another interesting footnote in the proposed law. The law said that the bankers may foreclose on a mortgage, *EVEN IF THERE WERE TECHNICAL IMPROPRIETIES WITH THE LOAN*. Some judges were refusing to foreclose, citing technicalities in the mortgage paperwork. In some parts of the country, some judges were reluctant to kick a large number of people out of their homes. The law was removing this discretion from judges. In other words, the law actually subsidizes the bankers.

For example, some of the mortgages had been bought and sold and repackaged several times via CDOs. It was no longer clearly documented who legally owned the mortgage. In some of those cases, judges were refuse to allow foreclosure. The bank that claimed to own the mortgage didn't have legal standing to foreclose, or perhaps they didn't have appropriate papwerwork. This law would remove judges' discretion to refuse to foreclose, if the mortgage paperwork was defective.

Whenever a policeman uses violence to evict someone from their home for not paying their mortgage, he is committing a crime. I don't advise people to borrow money and not repay it. I'm just pointing out the immorality of the US monetary system. The correct solution is to completely boycott the dollar and use real money (gold or silver) instead.

While most people associate cities with pollution and the material and ecological excess of late capitalism, I've long believed that urbanization has the potential to be a great environmental savior. The NYT has a fascinating article that confirms what I said about cities attracting people who would otherwise live more environmentally profligate lives: the amount of total rain forest is likely growing, due to the reforestation of towns and villages abandoned by people in Latin America and Asia who are moving to cities. Elisabeth Rosenthal, the article's author, explains the reasons that people are abandoning land at a growing pace:

In Latin America and Asia, birthrates have dropped drastically; most people have two or three children. New jobs tied to global industry, as well as improved transportation, are luring a rural population to fast-growing cities. Better farming techniques and access to seed and fertilizer mean that marginal lands are no longer farmed because it takes fewer farmers to feed a growing population.

By some estimates, these demographic and technological shifts mean that forests are growing back far faster than they're being cut down:

These new “secondary” forests are emerging in Latin America, Asia and other tropical regions at such a fast pace that the trend has set off a serious debate about whether saving primeval rain forest – an iconic environmental cause – may be less urgent than once thought. By one estimate, for every acre of rain forest cut down each year, more than 50 acres of new forest are growing in the tropics on land that was once farmed, logged or ravaged by natural disaster.

There are two problems, though, with the new forests: they aren't "old growth" forests, and they aren't necessarily able to support many endangered species. The first part – the fact that they are "secondary" forests and not primeval – might be important in that it means the ecosystem is not as dense and complex as it would be in, say, a rain forest that hasn't been touched since pre-Colombian times. Scientists haven't reached a consensus on how significant this is, though it's comforting to note that as time passes, the now-secondary forests will become denser and older. As for the endangered species, it's a combination of the first point (new growth) and the fact that these new jungles are growing in different places than the forests which are being cut down, and are not reachable by the animals that are endangered within the old growth.

Reading this makes me think of a Wired article from a few years back about the Mayans and the rain forest, and how much of the Yucatán jungles are likely to be feral gardens of the ancient Mayans.