Wednesday, April 28, 2010

Government intervention and economics in Iowa farming

Iowa Congressman Leonard Boswell (D-IA) is getting ready to develop a new farm bill. He has plans to speak to Iowa farmers as well as start the ball rolling in the House committee meetings. Most likely, the Congress will think of new ways to intervene in the agriculture sector of the economy (including Iowa's) and create unintended consequences.

The Federal government has been distorting the farming sector for many decades through bio-fuel mandates, subsidies, tariffs, and other policies. Farming and commodities, like any other markets, must balance supply and demand with prices arbitrating the right quantity to produce while minimize the input costs.

For too long, the government has micromanaged and socially engineer incentives and disincentives what the mix of what farmers produce. Instead of farmers balancing their long term best interest and highest return on investment capital and labor inputs (human capital, equipment and land), farmers respond to the intervention of the government policies (i.e. mandates, subsidies, tariffs). These policies encourage overproduction of certain commodities and underproduction of others.

Read the rest of the article here.

Sunday, April 11, 2010

Mises Circle - Inflationary Path to Despotism

I had the privilege of attending the Mises Circle this weekend in Phoenix, Arizona.  The event truly was a great experience and extremely compelling to hear so many Austrian scholars share their positions on the possible path to our nation is headed.  The speakers included Tom DiLorenzo, Robert Murphy, Jeffrey Tucker, Doug French, and Charles Goyette

In addition to listening to these fine speakers and their reasoned arguments on the political economy, I had the great honor to meet other liberty minded folks hungry for knowledge, truth, and awareness of what lies ahead of us if our country continues to the repeat the inflationary mistakes of the past.  Young and old, students and working professionals (such as myself) gathered to understand what these well respected scholars and writers had to say about the consequences inflation has on liberty and increasing the size and scope of government in an otherwise free society.

Someone asked me, "what brought you all the way here to Phoenix?"  Many reasons came to mind why I chose to attend.  But, overall, I attended because for too long people have expected to be spoon fed or entitled to happiness without pursuing it on their own.  Our country was built on the foundations of liberty, yet very few have the aptitude to demonstrate the essence of such a ideal.  I made a decision to stop standing on the sidelines as liberty withers and instead lead by example and learn what it means to live a liberty driven life.

Our nation has become a people addicted to being told what to do instead of succeeding or failing through the choices they make and must endure.  I made a promise to myself that I would not be one of those citizens anymore.  My life belongs to me and we all are sovereign free willed beings with special gifts and talents unique each person.  We must choose the life we want and not depend on others to live it for us.

If others can learn through my example and knowledge of the truth as I see it, can there be a downside?  The Mises Institute, Campaign for Liberty, Adam Sheppard, Ron Paul, Peter Schiff, Andrew Napolitano, Tom Woods, Robert Murphy,, and many other excellent authors and articles I've surveyed have lead me to the self evident truths I hold as constant:
  1. Liberty is eternal and embedded in every American's DNA
  2. If individual consent to form a government, the State should enforce and protect of property rights, the right to contract, and liberty over all other things.
  3. Non-aggression is the universal axiom and moral philosophy all citizens should recognize and obey without reservation or exception.
  4.  Free exchange in a marketplace between consenting entities creates wealth, prosperity, and a rising standard of living for all participants.
I pray others share or will come to embraces these ideas as our country encounters the unknown road yet to be traveled.

Wednesday, April 7, 2010

The Fed's Faux War on Asset Bubbles

Today, the AP reported the Federal Reserve is keeping its eyes open to prevent potential asset bubbles from forming.

Federal Reserve officials at their March meeting stressed the need to make sure record-low interest rates don't feed new speculative bubbles in stocks or other assets.

At the same time, some officials said the Fed's pledge to keep rates low for an "extended period" doesn't mean a fixed period of time.

One cannot help but laugh at the Fed's newfound "hawkish" stance on fighting asset bubbles. How can Ben Bernanke or the Fed board members make this declaration sincerely all while keeping the easy money credit spigot open, uber interest rates (0% to 0.25%), and an unprecedented $2 trillion dollar balance sheet. All of this liquidity has to stick to something. So, where does it go? Doesn't it go into places like bonds, stocks, real estate, commodities? Of course it does. Thus, the policies are fueling bubbles the Fed is supposedly trying to prevent. This scenario is a bit like a habitual alcoholic saying he is going to be on cautious so as to regulate himself from getting drunk while simultaneously sitting at a bar with 10 shots lined up ready to go. The Fed cannot have it both ways.

Read the rest of the article here.

Saturday, April 3, 2010

Iowa's bipartisan love of the nanny state

Earlier this week, Governor Chet Culver signed an expansionary “nanny state” prohibition of texting while driving a vehicle. The prohibition goes into effect July, 1, 2010 with fines being enforced a year from that date. This law is evidence of government’s belief in the fallacy it can and should regulate human behavior.

Texting is dangerous, causes distractions while driving, and prevents drivers from paying attention to safely traveling from one place to another. However, a multitude of other distractions are also dangerous and just as likely to cause accidents. Individuals understand if they cause damage to someone else, they will be punished and serve justice for their crime. Do we not already have laws and statues on the books in Iowa where this type of negligence is punished to prevent individuals from engaging in risky behaviors? Shouldn’t the law punish those who actually cause or inflict harm on others instead of prohibiting what people might do?

Few have discussed the unseen effects the prohibition will have on the behavior of motorists. Given the history of prohibition in this country (i.e. 18th Amendment), the lack of attention or analysis of the unintended consequences law will manifest is astounding. Evidently, the legislature is a bit ignorant to believe any ban will stop people from using their phones while they drive. Here’s a news flash for the Iowa Legislature: people will still text while they drive.

Read the rest of the article here.