Civil Liberties

The Outsized Role of Britain in the Modern World

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[B]y a singular chance, the expansion of that small society from Elizabethan times onward became increasingly identified with the central movement in the history of the modern world. No mere book can hope to do justice to the theme: it is written in the lives of men, in their work and arts, in the creations of their minds, in science and industry, in the busy tracks of the ocean, upon the landscape and on the face of the outer world. It was an extraordinary, an unimaginable, fate that befell the island people. Wherever we look in the world, or in modern history, we come upon evidence of the contribution they have made. Whether it is at sea, in the arts of navigation or maritime warfare from Drake to Nelson to our own time; whether it is in voyages of discovery from the Cabots to Cook and Scott of the Antarctic, in methods of planting and colonisation from Humphrey Gilbert and Ralegh, Captain John Smith and the founders of New England to Gibbon Wakefield and Cecil Rhodes; or in industry, trade, finance; whether it is in the experience of self-government, laid open for all to see, or in the essential traditions of the free world — personal freedom for the citizen, liberty of opinion and speech, the sanctity of individual life (the arcana of civilized society); or in the example of an instinctive and generalised morality of common sense and toleration, with its precious message of individual responsibility; whether it is in the gradual unfolding of the resources of industrial and mechanical power (the basis of modern industrial civilisation, worked out in this island), with its subsequent developments in atomic energy and in the air; or in the unceasing proliferation of its genius at once for literature and science — the experience of the island people has been more and more closely bound up with the essential achievements of the modern world, the most significant and certainly the most fruitful movements of the human spirit in the modern age.

A.L. Rowse, The Expansion of Elizabethan England (1955).

In our upcoming book, America 3.0, Jim Bennett and I trace the roots of American freedom and prosperity back through British and English history to the conquest of the island by Angles, Saxons and Jutes fifteen centuries ago. But our focus is on America.

The quote from A.L. Rowse sketches a much larger theme which our (already large) book could not contain: the English impact on the entire modern world. A book on this subject may yet appear from Jim Bennett’s hand, and it will be the Big Book, which we have discussed for years, a history of the entire Anglosphere from its oldest Indo-European roots down to today and outward into the future.

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The Many States of America

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Recently I was reading how a professor at the University of Illinois at Chicago was arrested for bringing an unloaded handgun to work, and that it made the news media. I reflected briefly on the fact that you can bring a loaded, concealed gun with you in most places in many states in the US and it wouldn’t be news, it would in fact be normal activity, for instance in the adjacent state of Indiana.

Meanwhile, in California, it is common for people to smoke marijuana openly as is discussed here. Needless to say, this behavior would get you immediately arrested in many states particularly in the south and midwest.

Taxation is also highly variable on a state and city basis. New York and California have some of the highest taxes, particularly on income beyond a particular level (progressive taxes). On the other hand, states like Florida and Texas have a much lower level of taxation and a much freer business climate in terms of regulation.

Without getting into the hottest of hot-button issues, clearly there are differences in the types of marriages and reproduction rights / right to life on a state by state basis. These differences are narrowing in some areas and getting wider in others.

Some states have “right to work” laws which massively limit union power, and have flourishing and expanding manufacturing economies as a result. Visit Alabama, South Carolina, and Texas to see where all the former manufacturing might in the midwest and Northeast and West Coast migrated to (if it didn’t go to China or overseas). The enacting of “right to work” laws obviously sends an important signal to business leaders whether or not a state is a friendly place to do business for incremental investment (along with taxation).

The “fracking” revolution has unleashed vast wealth in some states, and in other states it has been banned or severely curtailed. Meanwhile, California is going in on its own with carbon regulations and highly aggressive “green” energy targets, while other states are heavily reliant on traditional (and cost effective) technologies.

The differences on a state-by-state level on these different dimensions seem large and growing. They are much more subtle (though often correlated) with the Red / Blue analysis. An attempt to classify these vectors could be done as follows:
Energy Freedom – the ability to extract and use cost effective technologies (like natural gas, fracking, and coal) and a state’s willingness to invest more for reliability or the requirement to use expensive (green) technologies and curtail energy use even at the expense of industry competitiveness and reliability. California is likely on one end and Texas is on the other side, although many others have large freedom including Pennsylvania.
Safety Freedom – the right to defend yourself at home, in transit, at work and during study or whether that is assumed by the state. Sadly the most restrictive is Illinois and there are many candidates on the other side throughout the south and midwest (Indiana).
Personal Substance Freedom – the right to smoke, the right to drink, and the right to use various drugs or stimulants. Some odd states (like Colorado) are leading the way on this, it isn’t always the traditional Red / Blue divide.
Freedom to Work & Hire – the right to work and not be forced to join a union, and this is also tied with local laws and practices that limit the ability to hire and fire and direct hiring or limit firing in various dimensions.
Freedom to Build / Live / Rent – Houston is famous for having very limited zoning while other states and municipalities have highly restricted zoning practices. The New York co-op concept also severely limits new entrants along with rent control. These laws can also include whether you can work or have a business in your home. While subtle, these practices can have a large impact on prices and how the region functions.
Freedom From Excessive Taxation – Some level of taxation is necessary for government to function but high tax levels have severe intended and unintended consequences of under investment and evasion. Taxation includes state, local, city, sales, estate, property, and “sin” taxes. These vary significantly by area but are highest in California and the East Coast and likely the lowest in the South.
Freedom of Marriage Choice – A larger portion of states are recognizing marriages beyond the traditional marriage, and this varies by state
Freedom of Reproductive Rights – There are a wide variety of approaches and trends on a state level and then there are practical impacts, as well. This is highly variable by state in practice
Freedom on Medical Rights – an emerging model will be how each state approaches new medical practices and funding methodologies, along with the practical availability of doctors that subscribe to the state’s controls and funding methods. This area will grow exponentially in the near future

I believe that these sorts of analyses on a state by state level are much more useful than the traditional Red / Blue view (although they are often correlated) and when you start to dig in to the differences on a state and municipal level they are staggering, particularly when you view the extremes.

It would be interesting and useful to begin to put together the various data sets to analyze states and municipalities along these continuums, and others that I’ve likely missed.

Cross posted at LITGM

The Normalization of Abusive Government

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Consider:

1) The Drug Enforcement Administration is attempting to seize a $1.5 million building owned as a retirement-investment property by a dentist and an engineer. Grounds are a $37 sale of pot ..to an undercover agent..by one of the building’s tenants, a medical-marijuana dispensary.

As the judge in the case notes, the Obama administration (in 2009) sent a memo instructing federal prosecutors to not target medical-marijuana patients..before deciding to crack down and sending threatening letters to landlords.  He even wondered aloud if President Obama would change his mind about marijuana again, after the building had already been seized.

This, in a country whose current President pretty clearly was himself a marijuana user, not to mention former President Bill Clinton, who “didn’t inhale.” Neither Obama nor Clinton are in any danger of having their property seized, however.

2) When financial questions arose regarding the Mountain Pure Water Company, Washington did not send a few staffers to inspect documents. Instead, last spring, some 50 armed Treasury agents breached the company’s  headquarters in Little Rock, Ark. They seized 82 boxes of records, herded employees into the cafeteria, snatched their cell phones, and..according to reports..refused to let them consult attorneys.

“We’re the federal government,” Mountain Pure’s comptroller, Jerry Miller, says  one pistol-packing fed told him. “We can do what we want, when we want, and there’s nothing you can do about it.”

3) In Alexandria, Virginia, a 10-year-old was suspended and arrested for bringing a toy gun to school

4) In Tennessee, an Ohio couple was pulled over by  pair of black police SUVs.  “They were very serious,” said the woman who was driving. “They had the body armor and the guns.”

On the back of the couple’s car was a Buckeye leaf decal, similar to the one Ohio State players have on their helmets.

“What are you doing with a marijuana sticker on your bumper?” asked one of the cops, who had apparently never heard of the First Amendment.

5) In 2005, an Iowa couple purchased a small lot.  When they began to lay gravel on the land, which is located in a residential neighborhood, they were hit by an order from the Environmental Protection Administration informing them that the property had been designated a wetland under the Clean Water Act. They were ordered to stop grading their property and were told that they would face fines of up to $75,000 per day if they did not return the parcel to its original state. When the Sacketts attempted to contest the order, the agency  denied their request for a hearing.

Last March, the Supreme Court overruled the EPA  and stated that the Sacketts are entitled to appeal  the EPA order, rejecting the agency’s claims to the contrary.

“The EPA used bullying and threats of terrifying fines, and has made our life hell for the past five years,” said Mr. Sackett. See my post A Defensive Victory Against Administrative Tyranny.

6) Bob Wallace and Marjorie Ottenberg, California residents in their 80s, started a business to make water purification devices for backpackers. Their enterprise has been crippled by the Drug Enforcement Administration and state officials, on grounds that iodine crystals–a key ingredient in their product–can also be used for  methamphetamine production.

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What lies ahead, I fear.

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UPDATE: An an article at Belmont Club describes interest in alternative money creation as a way of anticipating inflation. It also goes further into a discussion of general competence.

The idea that Virginia should consider issuing its own money was dismissed as just another quixotic quest by one of the most conservative members of the state legislature when Marshall introduced it three years ago. But it has since gained traction not only in Virginia, but also in states across the country as Americans have grown increasingly suspicious of the institutions entrusted with safeguarding the economy.

What has changed is faith in the federal government, not just in Virginia but in a growing number of places. The lack of faith in the competence of government — and the soundness of the dollar — has been growing leading some states to create contingency plans in case the currency goes bust.

Once again, I apologize for my pessimism but this is what I see. First, there is this article, which quotes a well known financier.

There may be a natural evolution to our fractionally reserved credit system that characterizes modern global finance. Much like the universe, which began with a big bang nearly 14 billion years ago, but is expanding so rapidly that scientists predict it will all end in a “big freeze” trillions of years from now, our current monetary system seems to require perpetual expansion to maintain its existence. And too, the advancing entropy in the physical universe may in fact portend a similar decline of “energy” and “heat” within the credit markets. If so, then the legitimate response of creditors, debtors and investors inextricably intertwined within it, should logically be to ask about the economic and investment implications of its ongoing transition.

Certainly “growth” seems to be fundamental to our economic health. That, of course, presumes a growing population but it also would be affected by a stagnant population with a growing age disparity. The obvious example of the latter is Japan.

The creation of credit in our modern day fractional reserve banking system began with a deposit and the profitable expansion of that deposit via leverage. Banks and other lenders don’t always keep 100% of their deposits in the “vault” at any one time in fact they keep very little thus the term “fractional reserves.” That first deposit then, and the explosion outward of 10x and more of levered lending, is modern day finance’s equivalent of the big bang. When it began is actually harder to determine than the birth of the physical universe but it certainly accelerated with the invention of central banking the U.S. in 1913 and with it the increased confidence that these newly licensed lenders of last resort would provide support to financial and real economies. Banking and central banks were and remain essential elements of a productive global economy.

The effect of asset bubbles on such a system is worrisome as the history of Japan and the recent history of the US have shown. The Panic of 1907 was largely responsible for the creation of the Federal Reserve. That financial crisis is thought, by the authors of a recent book, to have been a consequence of the 1906 earthquake in San Francisco, which destroyed a large amount of real assets and the insurance costs that were associated. The immediate cause was financial speculation but the real losses had added to the fragility of the system.

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Gessler’s Hat

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In the foundation-legend of the Swiss confederacy, Alberect Gessler was a cruel and tyrannical overlord installed by the Austrians, who installed his hat atop a pole in the public marketplace and decreed that all should bow to it … to his hat, not merely his person. Such a declaration was, I think, a way of rubbing in his authority over the common citizens indeed, rubbing their noses in the fact that he could make them do so, and do so in front of everyone else.

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