Liberty Defined: 50 Essential Issues That Affect Our Freedom (20 page)

This solution is far from perfect, but solutions to government-induced problems are never easy. Since our economic problems have been the major contributing factor, all other solutions come up short. Maximum freedom for everyone is the best way to go in solving any of our problems.

Another concern I have with the immigration issue is that the strong border protection proponents are as interested in regulating
our
right to freely
exit
the country as they are in preventing illegal entry. No longer can we travel even to Canada or Mexico without a U.S. passport. Our government keeps tabs on our every move, which involves a lot more than looking for drug dealers, illegal immigrants, or stopping a potential terrorist.

Financial controls have been growing since the 1970s, and as the financial crisis worsens, not only will our coming and going be closely monitored, so will all our financial transactions.

Taking your money out of the country physically or electronically is strictly regulated by the eagle eyes of the FBI, the CIA, the Department of Homeland Security, and, you would never guess, the IRS as well. Violations of currency transaction laws, even when not associated with any criminal activity, are severely punished. Expatriation is frowned upon. Currency controls—limits on all overseas transactions and purchases—are commonplace in a faltering economy with a falling currency, which we will have to deal with one day.

A tight border policy to keep certain people out is one thing, but tight border control to limit our ability to leave when we please is something else. America is already working on an electronic financial curtain, which I predict will steadily get worse. The leaders of neither the Republican nor the Democratic party can expect to protect our civil liberties when times get tough: Both support illegal wars; both support Patriot Act suppression of our privacy; both strongly endorse the multitrillion dollar bailout of Wall Street. Neither party will protect our right to vote with our feet and take our money with us. The right of a citizen to leave the country anytime with his wealth and without government interference is a sharp dividing line between a free society and a dictatorship.

We must be vigilant when the cry is for closed borders, since such a policy may turn out to be more harmful to us than those who come here illegally. The Patriot Act did great harm to the liberties of the American people, and that sacrifice has not made us safer. Arizona-type immigration legislation can turn out to be harmful. Being able to stop any American citizen under the vague charge of “suspicion” is dangerous, even more so in the age of secret prisons and a stated position of assassinating American citizens if deemed a “threat,” without charges ever being made. The Real ID, supported by those demanding stricter control of our borders, was rejected by many because it was eventually seen as a step toward a national ID card.

There’s no reason to assume that any single group of hardworking Americans won’t accept the principles of a free society. That’s what most immigrants seek regardless of the color of their skin. Why shouldn’t they be open to the arguments
of defending private property, free markets, sound money, right to life, low taxes, less war, protection of civil liberties, and especially a foreign policy designed for peace rather than perpetual war?

Some conservatives and Republicans, in my view, insult many minorities by appealing for their votes only by trying to outdo the Democrats with giveaway programs. Why shouldn’t a strong message of personal liberty, self-reliance, and economic opportunity be appealing to immigrants as well as lifelong citizens? With the total failure of the welfare state and our foreign policy, it will become more evident that the door is wide open for the solutions that a free society provides.

O
ne of the most serious misconceptions in public affairs today is related to an erroneous understanding of government insurance. Once government gets involved in providing insurance for any economic purpose, it no longer qualifies as insurance.

Insurance is about measuring risk and finding market opportunities to reduce the consequences associated with inescapable risk that exists as part of our lives. The market provides insurance against untimely death, against automotive accidents, against fire in our homes, against burglary, and the like. The market does not provide insurance against risk that we create on our own. For example, you cannot buy insurance against losing the lottery, against business failure, against losing a sports match. This is because those are risks we create on our own. Market-based insurance is about cushioning the results of inadvertent events that negatively affect our lives.

Insurance is only profitable for both the insurer and the insured if risk is properly measured and priced. Only the competitive market can measure risk and find a price for the
insurance. In the same way that the failure of socialism is inevitable due to the absence of free market pricing, government subsidized or regulated insurance will always fail in the same fashion, because there is a moral hazard embedded as part of its underlying structure: It is not properly priced according to the level of risk. Regardless of how we behave or what we do, our premiums do not change and the payout does not change. Moral hazard, that is, the tendency to adopt the very behaviors against which we are being insured, is all but guaranteed.

The government’s definition of insurance is grossly misleading. Social Security is not, properly considered, insurance. Government-provided health benefits are not insurance either. And even such institutions as tax-funded flood insurance are not really insurance. All these programs are more accurately considered transfer payments. They redistribute wealth from one group to another. The rhetoric about insurance is just a cover to give these institutions legitimacy, effectively fooling people as to their true nature.

In fact, the term “government insurance” is an oxymoron—a total contradiction. And this applies to all government “insurance” programs. It comes from the deliberate twisting of language by those who know better, and economic ignorance on the part of others. Many believe—at least they want to believe—the government is quite capable of “insuring” all of us against risks: economic, personal, and foreign.

When government provides “free” benefits or services, people prefer not to admit they are actually receiving a subsidy or welfare. People feel good that they can “pay their own way,” not realizing that the program or assistance would cost
a lot more or wouldn’t be available without government. The future harm done and the penalty that inevitably is paid far surpass facing up to the truth that government has nothing to give to some, other than that which they steal from others.

One approach is accomplished by voluntary choices; the other depends on an authoritarian approach to managing society. If we ever expect to make progress in solving our problems while preserving liberty, the term “government insurance” must be removed from our lexicon.

In the past hundred years, too many, and especially those in public educational institutions, have been taught that government supervision is efficient and proper. The trend toward dependence on government solutions violates the restraints in the Constitution and ignores history’s explicit record of authoritarian government’s failure.

If we follow the rules of limited government and personal responsibility, the issue of moral hazard would be dramatically reduced to those who commit fraud against insurance companies instead of endorsing an entire political and economic system based on immoral behavior that has given us our economic crisis and a foreign policy of perpetual war.

The authoritarian approach of government has appeal despite its history of devastating failure. Trust in authoritarianism is the foundation on which modern-day moral hazard rests. Those who promote the virtues of government interference in our lives and economy do it with a proud arrogance, convinced that average people can’t and won’t do what’s in their best interest.

The planners are not bashful in saying that average people aren’t smart enough to take care of themselves. They deny they seek power over others just for the sake of power—heaven
forbid. Whether they seek power for their own sake or they are truly motivated to make a better world, most authoritarians pursue government and domination over others by espousing humanitarian causes passed off as virtues. And for a long time, too many citizens have accepted the rationale that we need government to bring about a fair, moral, peaceful, and prosperous society. This deception persists as we witness the perpetration of failed policies even though we’re in an economic crisis brought on by these false premises.

What we really need is a generous dose of reality. If this understanding is not challenged and refuted, the moral hazard that will result will guarantee an end to the grand American experiment in personal liberty and self-reliance. H. L. Mencken said, “The urge to save humanity is almost always a false front for the urge to rule.”

But it also requires the people’s complacency to buy into the free lunch argument. Not everyone wants their freedom and accepts responsibility for their own well-being. The problem is, there are always individuals who want to control others and a significant number of people who believe they will benefit forever from the gravy train. This allows the erosion of liberty to progress.

And then both groups come to believe their own lies. The authoritarian is convinced he is needed to take care of the stupid and inept of society, otherwise they will suffer. Though authoritarians reek with arrogance and the power serves as an aphrodisiac for them, they convince themselves they are truly serving humanity.

The recipients of the humanitarian efforts never see themselves as participating in an immoral process, nor do they see
the ultimate failure of the collectivist approach to improving mankind, whether socially or economically.

Almost all tyrannies are achieved with public acceptance, as a result of successful humanitarian propaganda that guarantees fairly distributed prosperity and personal and national security. Those who do not accept these premises are deemed unpatriotic and uncaring of their fellow man. Government propaganda is a powerful weapon used to instill fear into the hearts and minds of the citizens. Once this is done, it’s easy to get the people to accept government authority they otherwise would have rejected.

C. S. Lewis warned of the great danger of this “worst” tyranny. “Of all tyrannies a tyranny sincerely executed for the good of its victims may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated, but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.”

The danger of using humanitarian arguments is well known. Henry David Thoreau said in
Walden
that if he saw such an individual coming at him he would run for his life. Bastiat detested the do-gooders’ attitude as “philanthropic despotism.” Isabel Paterson recognized it as “the humanitarian with the guillotine.”

The saying that the road to hell is paved with good intentions dates in various forms back to as early as the twelfth century. Today we see that the road to tyranny is paved with delusions of grandeur. One would think that after so many warnings over the centuries we would be more alert to the
danger of deceitful humanitarianism gone amok. But I suppose wielding power by some combined with a desire for a free lunch by others makes it difficult to overcome these human traits. A “winning the lottery” attitude prevails.

Yet that’s what a free society attempts to do—properly understand “humanitarianism.” And for a while in this country, we did emphasize the value of liberty over security and authority. The question is, Will we ever again get our priorities straight? Let’s hope so, since all human progress depends on it.

Paterson, Isabel. 1993.
The God of the Machine
. New Brunswick, NJ: Transaction Publishers.

M
odern-day economic policies throughout the world have been greatly influenced by J. M. Keynes’s
The General Theory of Employment, Interest and Money
, published in 1936. Many believe that Keynes was the originator of this theory of massive government intervention to keep an economy strong. Ludwig von Mises made the point that Keynes was not actually presenting any new ideas. Keynes’s prescription for getting out of the Depression of the 1930s had been around for a very long time, and it was those ideas that actually got us into the Depression. By 1936, they had already done great harm to the United States and the world economy.