Archive for the ‘bureaucracy’ Tag

An Ant’s Guide to Management Theory   3 comments

Disbanding Troops and Bureaucrats   1 comment

The art of economics consists in looking not merely at the immediate, but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group, but for all groups.

This is an ongoing series of posts on Henry Hazlitt’s Economics in One Lesson. You can access the Table of Contents here. Although written in 1946, it still touches on many of the issues we face in 2017, particularly the fallacies government economic programs are built upon.

 

I will admit, this fallacy is one I’ve always kind of believed, so let’s work through it together and let Hazlitt straighten out our thinking.

Image result for image of the dmvAfter every great war, it is proposed to demobilize the armed forces and there is always great fear that there will not be enough jobs for these forces, resulting in widespread unemployment. And this does occur in the short term, because it takes a while for private industry to reabsorb these folks. Hazlitt had just lived through the coming home of the World War 2 vets.

Hazlitt points out that when the military is released from service, it should result in the public budget being reduced, which will allow taxpayers to retain the funds that were previously taken from them in order to support the troops. Taxpayers will spend their reclaimed income to buy additional goods, which will provide employment to the workforce.

The problem with this is when soldiers were supported by an unbalanced budget funded by government borrowing or other deficit financing, but Hazlitt deferred that discussion to a later chapter.

The soldiers previously supported by civilians will not become merely civilians supported by other civilians. They will become self-supporting civilians.

Image result for image of the dmvIf we assume that the men who would otherwise have been retained in the armed forces are no longer needed for defense, then their retention would have been sheer waste. They would have been unproductive. The taxpayers, in return for supporting them, would have got nothing. But now the taxpayers turn over this part of their funds to them as fellow civilians in return for equivalent goods or services. Total national production, the wealth
of everybody, is higher.

The same reasoning applies to civilian government officials whenever they are retained in excessive numbers. Every time there is an attempt to reduce the number of unnecessary officeholders, there is a cry that this action will be deflationary. You will remove the purchasing power from these officials. You’ll cause an economic depression.

[T]he fallacy comes from looking at the effects of this action only on the dismissed officeholders themselves and on the particular tradesmen who depend on them. … [I]t is forgotten that … the taxpayers will be permitted to keep the money that was formerly taken from them for the support of the bureaucrats.

With more of their income to utilize, taxpayers will spend more and that provides jobs for the dismissed bureaucrats. Washington DC might be less prosperous, but the rest of the country can afford more stores.

The bureaucrats seek private jobs or create private businesses, becoming truly productive men and women. Hazlitt explained that he was not talking about laying off bureaucrats who provide ESSENTIAL services that make it possible for private industry to function in an atmosphere of law, order, freedom and peace. Bureaucrats value as employees should consist in the utility of their services, not in the “purchasing power” they posses by virtue of being on the public payroll.

This “purchasing power” argument could just as easily apply to a thief who robs you. After he takes your money, he has more purchasing power that he uses to support bars, restaurants, tailors, automobile workers, etc. But for every job his spending provides, your own spending must provide one less, because you have that much less money to spend.

When your money is taken by a thief, you get nothing in return. When your money is taken through taxes to support needless bureaucrats, precisely the same situation exists.

 

Posted January 21, 2017 by aurorawatcherak in economics

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Reestablishing Commerce   Leave a comment

If we do not act to change the trajectory of the United States republic, our system of government will perish and take the good with the bad. We can’t control what will replace it and we may not like what we get. If we continue to be swept along by the current, we’re going to regret our inaction.

An Article V convention to propose amendments to the state legislatures might be a paddle in the current to sweep us in another direction.

There are plenty of proposed amendments to look at. Not all of them sound like a good idea. Mark Levin published a handful of nice-sounding ones. It remains to be seen if these are a good idea in practice, but some look like good ideas in theory.

KrakkenThree of them are definitely designed to remove some of the federal krakken’s teeth, so we might have a hope of regaining our individual liberty and robust economic way of life. It remains to be seen if states will agree these are good ideas, but they’re worth looking at.

Levin suggests an amendment to promote free enterprise by limiting the misinterpretation of the Commerce Clause and shifting the focus on the Department of Commerce. The original purpose of the Commerce Department was to “prevent states from impeding commerce and trade between and among the several states”. It was also meant to keep federal government out of regulating commerce within a state.

Oh, those silly Founders!

According to James Madison in the original Constitutional Convention, commerce was referred to as trade or exchange between foreign nations and the states. It was intended to prevent states from acting more like foreign nations relative to other states with tariffs and other restrictions on trade between the states.  That makes good sense now as it did then, except ….

The vagueness of the clause and its application has allowed for increased federal government intrusion in areas of commerce that would flabbergast the Founders. This amendment would provide some clarity and explicit “guardrails” for the federal government to operate within.

Next is “An Amendment to Protect Private Property” which very simply requires just compensation be made when private property is taken for public use. The ability to own private property is what sets us apart from virtually every other nation in the world.

The government morphed “Eminent Domain” into something that allows the taking of your property then giving it to a private entity (crony capitalists) that will pay more tax than you do. They’ve broadened the meaning of “taking” of property for public good (roads, utilities, and parks) into the taking of private property in order to enrich the public coffers and only reimbursing you for pennies on the dollar.

These three Amendments are designed to remove some of the teeth of the leviathan that is shredding our liberty, freedoms and economic way of life. Keep in mind these amendments proposed by Levin are just suggestions. Participating states will, as a group, take these ideas and change, delete and/or create final amendments on which they can all agree.

If we do not change our trajectory our republic will perish.

Given the current trajectory, that might be a good thing, but if we can change things ….

Alaskans battle for survival against feds’ protection of migratory birds – Washington Times   Leave a comment

Alaskans battle for survival against feds’ protection of migratory birds – Washington Times.

“There is a safe and an easy way to help our fellow citizens, and the only thing standing in the way is our own federal government’s decision to place a higher value on the birds than it does on the health and the safety of my state’s citizens, and that is simply wrong,” Mrs. Murkowski said Wednesday at an Appropriations Committee hearing.

Shut Down Gets Personal   Leave a comment

As I said, Alaska as a LOT of federal employees. We’re 2 or 3 in the nation, depending on the news article. So there are at least three non-military federal employees going to my church. The “shut down” just got personal, because these are people I know and care about.

However ….

One man is still working — he’s TSA, so is considered an “essential” worker. He began looking for other work several months ago anyway. This is just making him look harder.

The stories of the other two are interesting in their diversity.

The woman who works for federal wildlife is freaking out because she didn’t plan for something like this and she can’t pay her bills.

The guy who works for the fire service was calm and collected. He typically takes a couple of weeks off this time of year because his schedule is insane during the summer fire season, so he’d be hanging out at home anyway. He and his wife and kids live on his income alone, but it’s a good income and they live modestly, so they have six months’ of operating expenses saved for a rainy day. He said when his slightly shifted two-week vacation is over, he’ll start doing the computer work he does all winter from home, so he will be legitimately eligible for back pay. I asked him if he could hang on until after Christmas as some of the pundits are saying it might go that long and he said he could. The State of Alaska has been head-hunting him for a decade, so if the federal government permanently contracts he’s likely got a job if he wants one. He’s got one more year before he has 20 in with the feds, which triggers important changes in retirement, which is what he’s holding out for — but he also really likes what he does in his job.

It’s painful to watch friends struggle. I’ve been there myself and I know it’s not fun. However —

Planning ahead for the inevitable federal contraction should have been Plan A for every federal employee. Right now it’s temporary, but it should be permanent. My friend who works for the fire service wisely planned for that inevitablity. Federal employees typically make 52% more than workers doing similar jobs in the private sector. They can afford to save for their future and they should.

Does the federal government really need to do things like the fire service? The fire service is an essential function in Alaska’s summers. Black spruce will burn if a moose exhales too warmly. I’m not saying the job my friend does is not essential. But does the federal government need to do it? The State of Alaska already has agencies that do something similar and my friend has already been given an open door to that employment.

Does the federal government really need to do wildlife service? Again, the State of Alaska has a very large wildlife division.

Does the federal government really need to do the TSA? These functions used to be done by private contractors for local airports. There’s no evidence that TSA is doing a better job than they did. Yes, three planes were hijacked, but I’m not convinced that the TSA could stop that any better than private contractors would.

Just because the contraction of government services became personal does not change my essential belief that the federal government is bloated beyond sustainability and needs to be severely pared down. Right now about 85% of the structure is still functioning, but in reality, by 2025, the structure should be one-third of what it currently is.  With the exception of those workers currently employed by the federal government needing to go find other jobs, the services that the federal government provides are largely unnecessary, duplicative of state-level agencies or could be performed by the private sector. Those federal employees who have good skills and a good work ethic will be able to find similar work in state government or the private sector. They probably won’t get paid as much, which stinks for them, but they should never have been allowed to make more than the prevailing wages of their employers (we the people) anyway.

What Is Essential Service?   Leave a comment

The government shutdown, which so far doesn’t seem to affect anything important in my life, is good practice for what we will have to do without when the federal government collapses from unsustainable debt, so it might be a good idea to ask ourselves –

What is an ESSENTIAL federal government service/program?

Don’t get me wrong! I loved the Statue of Liberty when I saw it and Independence Hall is on my bucket list. The Smithsonian museums were really cool, and I was sorry to miss the National Zoo on that trip. The Grand Canyon is beautiful and, while I’d rather raft through it than ride a mule down the side of it, I get that people enjoy that. But –

Are these ESSENTIAL federal government services? There’s two questions there, by the way.

  • Are they essential?
  • Does the federal government need to do them?

PBS used to have an advertisement – if PBS doesn’t do it, who will?

Well, it turned out that cable TV does a lot of what PBS used to do and from what I can tell, PBS is still producing shows, so the answer to the question is – HGTV and A&E and PBS with a different funding stream. The world didn’t end. My TV viewing options changed, but they expanded rather than became more limited. Ain’t market competition wonderful?

So, are national parks an ESSENTIAL government service? Someone who doesn’t live in Alaska is going to have to weigh in on this one because I can go into the woods anytime I want with no help from a federal agency. In fact, federal agencies RESTRICT my access to nature with rules, regulations and permits on the assumption (I gather) that I’m going to dump radioactive waste in the wilderness. Because unpermitted hikers go into the wilderness for the express purpose of destroying the wilderness, don’t you know?

Anyone familiar with Old Sturbridge Village? It’s a non-profit “living” museum funded by donations to the foundation that owns the museum and grants from state and local governments. As far as I can tell, they don’t take federal funds, though I didn’t research whether they’d ever gotten a federal grant. The point is, they aren’t an agency of the federal government. News has it that it’s open today.

Ditto Colonial Williamsburg, another living history museum, which receives no regular state or federal funding. They’re a private non-profit foundation that operates a for-profit wing that provides the largest percentage of funding. I believe they’re open today as well.

In fact, there are dozens of private, non-profit and/or state-funded museums and cultural centers all across the United States that are open today AND paying their employees.

So, Question #2 can be definitively answered as – NO! The federal government does NOT need to be the manager/owner/tyrant of parks. We could have these cool things without the federal government doing them.

As for Question #1 – are these services ESSENTIAL? I suppose if you work for the federal government at the National Zoo, your job is essential … to you … but is that job so essential to the public good that I should have to pay for it? There are folks working for Old Sturbridge Village and Williamsburg and they get paid by the people who are actually using those services and/or individuals and organizations that support the work of those foundations. Nobody is saying the Statue of Liberty isn’t worth having around. The argument is — is it essential and must it be done by the federal government?

I think the answer is, to both questions, no. It’s not essential, but it’s cool and I hope it’s around for a long time to come, but a private non-profit or the New York State Parks system could administer it just as well.

Now we can move on to determining if the next bunch of furloughs meet those two requirements. The longer the shutdown goes on, the more opportunity we have to evaluate the necessity of the tabled programs and the non-federal alternatives to providing the important ones.

The federal government is going to have to reduce to a manageable size eventually anyway, so we might as well get in a little practice.

The Ultimate Party Line   Leave a comment

I’m starting to like Rand Paul. I didn’t at first. I never much liked sons/daughters following dad into the family business of politics and Lisa Murkowski, Mark Begich and George W. Bush solidified that dislike in me. I also don’t care for his dad, Ron Paul. I like some of the ideas he espouses, but there’s something about the man that just doesn’t sit right and I’ve learned to trust my gut on some things. So, at first I didn’t like Rand Paul because of principles that had nothing to do with the man and then I didn’t like him because, whenever Rand opened his mouth, he seemed to make the conservative movement look foolish. Of course, that may well have been media manipulation of his message … or maybe he was just new and wet behind the ears.

Lately, however, he’s starting to sound really good. The fact that the Huffington Post hates him doesn’t hurt his stock with me, but he’s also saying intelligent things.

http://dailycaller.com/2013/06/13/exclusive-rand-paul-says-gop-divided-on-privacy-rights-because-of-generational-gap/

Rand is completely correct in stating this is a generational problem. There was a time when electronic communication was new technology and viewed by people of my parents’ generation (Greatest Generation) as somehow different from talking face-to-face. Even the telephone seemed different enough to not be covered by the Constitution. That was the rational of the Supreme Court in the 1979 Smith versus Maryland decision, that the use of electronic media somehow set aside our right to privacy. There were people who objected then – me, for example – but mostly people thought that if the Supreme Court rules something than their ruling IS the Constitution. Well, when the Supreme Court ruled that Dred Scott wasn’t equal to his fellow Americans, was that Constitutional or was the Supreme Court acting in a politically motivated manner? I think we can all agree that it was the latter.

We live in different times from 1979. My parents’ phone was on a two-party line back then. Privacy did have a different flavor to it when Mrs. McGowan could listen in. I had a more-or-less real-time conversation with a friend last night over email. That’s not uncommon. People today use email, telephone, text, Skype, Facebook, etc., to communicate. The idea in Smith was that when you transmitted the electronic data (phone numbers) to the telephone company, you were putting that information into the public domain. Agencies could connect numbers and recognize potential connections, but there was no ability to routinely record the conversations attached to those numbers. It took a massive amount of technology to access what was said and the SCOTUS had ruled in Katz versus the United States that the conversation was protected unless on issue of a warrant, which were not easy to get. That seemed reasonable. If your brother had grown up to be a bank robber, but you still talked regularly to him, that connection was a part of public record, but if you showed no signs of being a criminal, a judge was not going to issue a warrant to tap your telephone, though they might take his.

The Patriot Act changed that. Now the warrant applies to all the traffic on a particular carrier and the warrants are automatically renewed without a hearing by a judge, who by all accounts rubberstamps the FISA request anyway. The conversations are automatically recorded, held in cyberspace for a period of time while computers analyze them for key words and then, if the computer decides it sounds interesting, a human being listens to or reads them – all without a warrant based on a reasonable belief that you might be a criminal.

The possibilities – well, probabilities — for government abuse are enormous.

http://reason.com/blog/2013/06/14/phony-baloney-fisa-court-makes-resistanc

Just think about it in light of the IRS scandal involving the targeting of “tea party” organizations. Depriving organizations of money is obviously effective, but consider if this system could be used to interfere with more loosely based tea party groups that are trying to organize low-cost gatherings – such as classes to study the Constitution or the Austrian economists. If you could use that technology to harass people and create a chilling effect …?

In case you think this is a problem with the current administration or Democrats in general, here is an article that runs down how we feel about violation of our privacy when it’s the “other party” doing it.

http://reason.com/archives/2013/06/14/nsa-confidential-we-love-big-brother-if

Yeah, in 2006, many Republicans thought it was a dandy idea to spy on American citizens provided it was a Republican administration doing it. It is clowns to the right and jokers to the left in a major dance of situational ethics. It is not a partisan issue because members of both parties do it and members of both parties are violating our constitutional rights.

Regardless of what the Supreme Court has ruled 35 years ago before this technology existed, regardless of which party is in power at the moment, it was always wrong for the government to listen to our conversations without an individually issued warrant, but the point was moot when they lacked the technology to do so. Now they have the technology and we need to assure that they aren’t able to legally use it against us and then we need to dismantle the bureaucracy that would want to use it against us because … let’s be clear on this … the technology exists and as long as you have crooks in control of the government, they will use it against us.

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