Category Archives: socialist

The Progressive Mind: Socialist Planning for Abundance

Socialist Planning for Abundance
By Corliss Lamont

Corliss Lamont (1902 – 1995) was born into one of America’s wealthiest families. His Father was Thomas Lamont, partner and later chairman of J.P. Morgan & Co. He was educated at some of the most prestigious schools in America and England, Phillips Exeter Academy, Harvard, Oxford, and Columbia. Later he became one of the foremost apologists and philosophers of socialism during the twentieth century. The following article is reprinted from one of his better known books, “You Might Like Socialism”1 published in 1939.

1. Everyone Can Live Well
Like anyone else, I want to live well, and I want my wife and three children to live well. I believe in the wholehearted affirmation and enjoyment of life. There are surely few mortals who appreciate more than myself the simple material things that both sustain human existence and can bring to it such delight. I enjoy good food, comfortable living quarters and surroundings that are pleasant and healthful. I am very fond of sports, especially tennis, skating and swimming. I like to dance. And I enjoy, too, the pleasures of culture: the leisured reading of books and poetry, stimulating wit and conversation, evenings at theater and concert and motion picture, the opportunity to write.

Some of my conservative upper-class friends occasionally banter me on the exuberant way in which I relish the sweets of existence, as if such relish showed that I could not really believe in Socialism. But they miss the point. For it is precisely the destiny of Socialism to bring to the whole community those felicities of living that up to now only a small minority have had the chance to enjoy. I want everyone to live well. And I am convinced that Socialist planning could quickly assure to every American family not merely economic security, but also a fair degree of comfort. For this reason, the idea of a Socialist society ought to attract profoundly not just the more poorly paid workers and farmers, but most of the middle class and many members of the upper class as well.

If we attain Socialism in the United States during my lifetime, I fully expect that I and other persons who are at present economically privileged will be able, if we work loyally under the new system, to maintain a very decent standard of living, though not one that is luxurious or extravagant. This Socialist promise of general prosperity is one of the chief reasons why I consider so infinitely shortsighted and unintelligent those members of the upper class who oppose with such bitter-end stubbornness the passing of Capitalism. For they themselves can share to a substantial extent in the abundance which Socialism will make actual. And so long as they prevent this abundance from coming to fruition, they are playing the invidious role of dogs-in-the-manger. They are saying in effect to the people: “It is true that we cannot ourselves unlock the untold possibilities of this modern economy, but just the same we don’t intend to let you do it.”

Suppose the American people woke up some fine morning and read in the newspapers that every factory and farm in the country was operating at full blast, that all the millions of unemployed had been able to find jobs, that sweeping increases in wages would shortly go into effect and that for the first time in years federal, state and municipal governments saw the sure prospect of balancing their budgets. One can imagine the sense of relief, the happiness, the positive thrill that would be felt from one end of the country to the other; one can picture the rejoicing that would be called forth in every American home, in every place of business, in every public gathering. It would be like the end of the Great War (2); indeed, it would be the end of a Great War, the war on poverty, on unemployment, on depression and the thousand ills that accompany these major maladies of the capitalist system.

All this I have been depicting is no mere word-mirage. It is a close approximation of what would actually take place under full-fledged Socialism. For Socialist planning means that the American economic system would in fact be kept going at 100 per cent capacity, that its potential plenty would at long last be released, its productive resources and distributive techniques utilized and developed to the maximum for the people and by the people. The almost immediate outcome would be that $5,000 (3) income for every American family that I mentioned earlier. And as time went on, this figure would steadily rise. These considerations spell out why Socialism means wealth,  fabulous wealth, and eventually tenfold, yes a hundredfold, more wealth than Capitalism has ever been able to bring mankind.

2. The Principles of Planning
The fundamental principle that lies behind planning is fairly simple and one which we encounter in some form in many different realms of human behavior. It consists of coordinating our activities in the light of our capacities and of the objective external environment, especially its economic aspects. As individuals we all plan to some extent, whether it be for a day or a month, a year or a decade, always keeping a weather eye on the state of our finances.

If we have a family, then planning becomes more complex and essential. The intelligent family looks into the future so far as is possible and plans, according to its resources, for the needs of its various members. If it is wise and has any sort of dependable income, it will make an annual budget, allocating definite sums to food, housing, clothing, recreation, baby carriages and the like. It will also probably try to set aside certain amounts as savings; and the most prudent heads of families will plan years and years ahead for the particular needs and vicissitudes of old age. Thoughtful people will take an even further step and, through the process of wills, lay careful plans for friends and family long after they are dead.

Coming to purely economic units, we find that every kind of business concern, no matter what its size and nature, must plan. The larger and more complex it is, the more attention it has to pay to planning. Any big corporation, for instance, with its many different departments, must have central planning in order to coordinate its various activities and to function successfully as a business. This is true whether the U. S. Steel Corporation or General Motors is concerned, whether R. H. Macy and Company or American Telephone and Telegraph, whether Standard Oil of New York or the Pennsylvania Railroad. The planning necessary for the efficient management of huge businesses like these reaches out to all parts of America and in some degree abroad as well. And in certain fields where big business has come to be overwhelmingly predominant, the planning of a few large trusts or even of a single monopoly may extend over well-nigh a whole industry.

The purpose of planning in all capitalist enterprise is, of course, to make money. And this means that each business, in the process of continually establishing and re-establishing its own superiority, must plan against its rivals and win away from them more and more customers, Trusts in the same industry have to plan against each other and also, in order to capture a larger and larger share of the general consumer’s income, against trusts in other industries. Thus, in enterprise both large and small, the plans of individual businesses and businessmen tend to cancel one another out to a considerable extent. The capitalist theory is that the most efficient and intelligently managed concerns come out on top. Undeniably this is frequently true; just as often, however, it is ruthlessness and lack of moral scruple that turns the trick, as has been amply illustrated in the lives of our “robber barons.” But whether efficiency or ruthlessness or perhaps both together are operative in any particular case, the result for the community is in the end economic.

In order to mitigate or prevent the disastrous results of anarchic Capitalism in some important field, capitalist governments sometimes put into effect a species of planning for an entire industry. In most European countries the telephone and telegraph are publicly owned and operated, and in several the railways as well. Then, too, there are public planning schemes in existence over particular localities. A good example of this is the Tennessee Valley Authority (TVA), which is exploiting the power resources of the Tennessee basin on behalf of the population of the vicinity, much to the chagrin of the private utility companies. These types of piecemeal planning, however, no matter, how well they may work in the sectors allotted to them, cannot go far in solving the economic problems of a country as a whole.

It is characteristic that the most far-reaching schemes of public planning under Capitalism should be for profit, or for profit and war. The so-called planning of the New Deal during President Roosevelt’s first term was directed, especially in agriculture, toward decreasing production in order to bring back profits by making goods scarcer and prices higher. While the Great Depression was still ravaging the United States, the NRA (National Recovery Administration) and the AAA (Agricultural Adjustment Administration) nobly cooperated, through planned destruction, with the usual haphazard destruction for profit by individual capitalists. Those were the days when almost over-night a fourth of the cotton crop was ploughed under, the wheat acreage reduced by 20 per cent and five million pigs destroyed. The AAA, doing its best under the circumstances to rescue the American farmer by boosting the price level, actually paid bonuses to all the producers who participated in this wholesale sacrifice to the capricious gods of capitalist economics.

During the Great War, America, and more than half the nations of the earth as well, carried out planned destruction on an even larger scale. Not only did this war planning entail the shooting away into nothingness of billions and billions of dollars worth of goods in the form of munitions; even the food, clothing and other supplies for the military and naval forces were for the purpose of enabling millions of men to engage in the entirely unproductive function of fighting to the death millions of other men. In order to wage war more efficiently, the American Government proceeded to co-ordinate in some measure the economic life of the United States by setting up the War Industries Board, the War Trade Board, the Shipping Board, the Fuel Administration, the Food Administration and the Railroad Administration. Since the railroads under private management could not stand the added strain of war conditions, the Government took them over entirely and administered them on a unified basis. Unhappily, today again, the bulk of the planning that is going on in capitalist countries is for belligerent purposes. This is especially true of the Fascist Powers Germany, Italy and Japan in each of which the whole economy has for a number of years been on a war basis. As these Fascist states push farther and farther their present aggressions and prepare for new ones, they are forcing the democratic Capitalisms to introduce ever more extensive planning for the object of armed self-defense.

This brief review of the limited planning that takes place under Capitalism shows how far removed it is in aim and scope from Socialist planning. Planning under Socialism is for use, not profit, for increasing production, not decreasing it, for peace, not war. And it demands as an absolute prerequisite the socialization of production and distribution. For as long as private capitalists retain possession of a country’s natural resources and transportation facilities, of factories, farms, banks and all the rest, they have the power to throw out of gear the best-laid of Plans. It is common knowledge that even with the minor public controls established under Roosevelt’s NRA, the American capitalists, long before the law was declared unconstitutional, constantly sabotaged, dodged and defied the Act. But Socialist planning puts a finish to that unending tug of war, so characteristic of Capitalism, between the Government, supposedly representing the public in general, and various business interests jockeying for control of it and determined to carry out whatever profit promising policies seem most advantageous. Under Socialism, politics and economics are thoroughly integrated.

The socialization of economic activity which I have in mind, however, does not necessarily entail either nationalization by the federal government or ownership by state or city governments. Many industries, under Socialism the national government will certainly take over; many other economic concerns, less far-reaching in their ramifications, state or city governments will own and operate. But besides all this, there will be a broad sector of enterprise which is socialized yet not governmental. It will be advisable to run some industries through the instrumentality of Public Corporations, which will be subject to control by the government planning authorities, but largely independent in their administrative work. In the non-governmental class will also be collective farms and fisheries, and indeed almost the whole of agriculture; co-operative societies for production and distribution; and much of journalism, art and culture in general.

This means that there will be a sizable number, running into several millions, of independent individuals not on the pay-roll of any governmental concern. These will include a large proportion of the handicrafts-men, farmers, fishermen, inventors, teachers, authors, journalists, actors, artists and intellectuals. They will make their living by working in such organizations as I have just mentioned; or by selling their products or services to such organizations, to public agencies or to other individuals. So, in the Socialist state there will be plenty of room for freelance workers of every type.

Socialist planning differs from any sort of capitalist planning, lastly, in that it is not confined to special localities, industries or periods of time, but is continuous and nation-wide. A genuinely planned economy demands not only that all individual businesses in one industry, whether it be concerned with hats, shoes, sugar, coal or anything else, be consciously coordinated, but that each industry as a whole, including the prices of its products and the wages and working hours of its employees, be coordinated with every other industry as a whole. Think of the increase in efficiency and the decrease in waste that would result from planned coordination among America’s big energy-producing industries: coal, gas, oil and electric power. Such coordination, however, could reach its high point only when there was complete coordination also among the industries to be served. For only when we know how much energy is required throughout the whole country, and where and when, can we accurately gauge how much coal, how much gas, how much oil and how much electric power should be made available in a given period and in a particular locality.

Again, it is obvious that there is so much overlapping in the field of transportation among railways, boats, buses, trucks and airplanes that the situation cries out for unified planning. But it is not possible to separate transportation from the things to be transported. A plan for coordinated transportation implies a plan for coal and steel, farm products and finished goods, just as a plan for all these things definitely implies a plan for transportation. And of course all of agriculture must be carefully correlated with all of manufacture. The flow of foodstuffs to the cities must be coordinated with the flow of manufactured goods from them. The needs, of the farmers must be estimated. Our steel plan, for example, must take into consideration the demand for tractors, combines and other agricultural machinery; and our agricultural plan the particular food requirements of the heavily laboring steel workers.

Likewise there must be a well-worked-out plan for wholesale and retail trade, linking up these two main branches of distribution all along the line with industry, transportation and agriculture. The shops in town and city, the restaurants, the warehouses, the gasoline stations and other such distributive units all come into the planning picture here.

Since the planning I envisage covers the entire socio-economic scene, it naturally extends into the fields of health and recreation, of education and culture. Socialism is particularly concerned to bountifully provide all the different activities and services in these realms with the necessary equipment and other economic prerequisites. The educational plan of the country, moreover, must be always closely interrelated with the economic plan, so that there may never be a lack of the needed technicians, scientists and other experts nor a deficiency of suitable employment opportunities for graduating students. Finally, the entire economic and cultural life of the country must be carefully correlated with finance under one vast, unitary budget that takes in all branches of industry and agriculture, of commerce and trade and extra-economic endeavor.

This completes, in outline form, the picture of the great National Plan which Socialism sets in motion, a Plan which brings into the economic and social affairs of any country that adopts it a closely knit unity, a smoothly functioning team-work, among all the myriad enterprises and individuals involved, making each one count for infinitely more and lifting the collective achievement to new and unheard-of heights.

Because of its controls over production and distribution, currency and capital investment, prices and wages and hours, Socialist planning is able to overcome totally and permanently the central capitalist difficulty of lack of purchasing power. As more and more goods come out of the factories, wages go up throughout the land or prices decrease or the working day grows shorter. To take care of the increased turnover in commodities, currency may, depending on its velocity of circulation, be expanded. Since there are no capitalists to appropriate a large proportion of the value which the people produce, the full instead of only the partial value of their labor returns to them in one form or another. Thus, the unceasing abundance of goods is matched by an unceasing abundance of purchasing power. And this results in that depression-defeating, prosperity-ensuring balance between production and consumption, supply and demand, which every orthodox economist and capitalist has fondly dreamed of seeing Capitalism itself attain.

The United States and other capitalist nations are only as rich as the amount of goods that can be sold for a profit during any given period. But Socialist planning makes a country exactly as rich as its entire productive capacity during any period. This is why I say without hesitation that Socialism, in terms of sheer economic efficiency, is sure to far outstrip Capitalism. Since finance is the most important single element in Socialist planning and more crucial, if anything, than in a capitalist economy, a fact which ought to give some slight consolation to capitalist bankers, I want to discuss the subject in more detail. In a Socialist state the banking system operates under and administers an all-embracing Financial Plan for the nation as a whole. This Financial Plan is the counterpart of the Material Plan and translates all the production and distribution schedules of the latter into dollar units. The dollar is the common denominator in which the various aspects of the National Plan can be accurately expressed and clearly related to one another. The Financial Plan and the Material Plan are, in effect, two versions of the National Plan and each serves as a check on the other.

The Government Treasury Department, together with the State Bank and its numerous branches, acts as a great central pool for the national income. This it does not only through taxation of Socialist business concerns and of individuals, but also through receiving a substantial share of whatever surpluses the different businesses, including those involved in foreign trade, succeed in accumulating. A considerable portion of such surpluses, however, are retained locally by the factory or other unit earning them and are used collectively for expansion, improvements or social benefits connected with the same enterprise. The Government also raises a certain amount of capital through savings banks and through the flotation of public loans, which continue to be necessary during the first stages of Socialism.

The surpluses or “profits” which economic enterprises build up under Socialism have a very different status and play a very different role from what we have been accustomed to expect under Capitalism. They are, in fact, mainly a book-keeping device. Socialist business is run, as I have said, not for the sake of making profits, but in order to provide goods and services to the community. The most convenient process of accounting and of distribution, however, demands the mechanism of buying and selling, of money and prices. Furthermore, identifiable “profits” are necessary so that our Socialist planners can set aside a certain proportion of the nation’s income in order to meet depreciation and obsolescence and, above all, in order to expand the means of production. Soviet Russia, for instance, put into social savings for such purposes an annual average of one-third its total income during the first two Five-Year Plans, a feat which stands out all the more owing to the fact that capitalist economists have always argued that a Socialist government would act like a reckless spendthrift and could not possibly exercise the foresight and intelligence to accumulate capital.

Whereas under Capitalism money and prices control the output of goods, under Socialism it is the output of goods that controls money and prices. Money is on a goods standard, not a gold standard. No real need exists for the latter unless to make the initial transition from Capitalism psychologically easier in the minds of the people. There can be no such thing as financial bankruptcy unless the supply of commodities proves inadequate; the value of the currency does not depend on any gold reserve, but on the quantity and quality of goods that nationwide planning has made available. Money ceases to be a commodity in itself, as under the capitalist system. It simply serves as the recognized unit of economic measurement and exchange, a function that some medium will have to perform in any future stage of society.

The most obvious advantage of a Socialist financial system is that it enables the public authorities to distribute and re-distribute the nation’s capital resources according to the needs of the entire economy. The surpluses acquired in one sector of business can be transferred to other less developed and less lucrative branches of economic activity. This is analogous, on a national scale, to the various allocations within the huge budgets of some of the bigger capitalist corporations. Under Socialism a number of enterprises, particularly in the sphere of education and social services, will continue to show financial loss, perhaps permanently. And there will also be deficits in the industrial field, especially when some great new project is getting under way.

Socialist financial planning requires that there be an ordered flow of capital investment all along the line in place of the slap-dash, haphazard methods prevalent in capitalist countries today. Instead of overinvestment in some directions and under-investment in others, with crisis-causing disproportions as the certain result, Socialist planning ensures a balanced and even distribution of capital resources, that is, social savings, in the directions most useful and important. It would be inconceivable, for example, for vast quantities of capital to go into the building of palatial homes, yachts and other super-luxuries for a small class of the economically privileged while millions of families lived
in houses beneath even a minimum standard of decency.

It would also be inconceivable for socialized capital to go into the production of things clearly harmful to health and well-being such as noxious drugs, patent medicines and deleterious foodstuffs for which there might be unintelligent and perverse demand. It would be impossible, too, for capital to create manufacturing plants and services that would be continually duplicating one another, ruining one another through cut-throat competition, spending huge fortunes in misleading advertising, and inundating a locality or even the entire country with a bewildering flow of practically identical goods. The huge sums of money and the very large personnel involved in speculative activities in commodities, in land, and in stocks and bonds would also become a thing of the past. And, alas for the gamblers of high finance, that symbol of Capitalism at its worst, the stock market would be no more.

The perfect synchronization between savings and capital investment that Socialist planning makes possible is one of the weightiest arguments in its favor. Since the decision of how much and where and when to save and the decision of how much and where and when to invest rests in the hands of the Planning Commission and the Government, there is no danger that these important decisions will be at odds with each other as they so often are under Capitalism. The unplanned capitalist method means that two sets of different people, frequently with conflicting interests, save and invest as they see fit, with the result that the relations between saving and investment are always becoming maladjusted. Either savings cannot find an outlet in profitable investment or needed investment cannot find sufficient savings to put it across. In either case economic troubles are the outcome.

Under the financial system I have been outlining, every producing and distributing unit in the country has an account in the central State Bank or one of its branches. And it is the duty of each bank to check up on the use of the credits, long-term, short-term or emergency, which it issues at any time. It must make certain that the automobile factory, for instance, to which it has advanced a certain amount of credit, actually produces the motorcars called for by the Plan and supposedly made possible by the credit. The factory has the obligation of giving the bank definite reports on definite dates showing how it is
fulfilling its program. If the bank discovers that the credit is being wasted or used inefficiently, it will at once stop further credits until the matter is cleared up, even instituting a special investigation if necessary.

Thus, under Socialist planning, the banks become the watchdogs of the whole economy by carrying on what amounts to a constant audit of all business enterprises. They act as the vital link between the various sets of plans drawn up on paper and the fulfillment of these plans in terms of concrete goods and services. Their vigilance means that there can be no let-down on the part of either management or workers in a concern without the whole personnel being called to task.

In this function the banks are aided by a system of accounting which penetrates into every nook and cranny of economic activity. Socialist accounting, organized on the strictest basis, aims to cut production costs and to attain the greatest possible results for the least possible expenditure. Book profits enter again into the picture here as a partial test of whether or not a plant is being operated efficiently. So the idea sometimes advanced that, under Socialism, extravagant executives will fling away heedlessly and without restraint the financial resources of the community is merely a caricature.

Furthermore, besides the checks and balances inherent in the technical set-up of Socialist planning, there is always the control exercised by the people themselves through regular democratic procedures. At established intervals they can approve or disapprove of the planning schemes in effect or proposed by electing representatives and officials committed to carrying out the popular will. And at all times they can bring pressure to bear by criticisms and suggestions through public meetings, the organs of opinion, individual or organized lobbying, and other such processes of democracy. Of paramount importance in this connection will be the role of the trade unions, to which virtually all working persons will presumably belong. There is nothing, then, in the nature of Socialist planning which prevents it from being administered in a thoroughly democratic manner.

One can easily imagine some of the big public issues which are almost certain to emerge in the natural course of collective economic planning. Since the standard of living under Socialism goes steadily up, the question will arise as to how the people can most benefit from the increasing wealth. Shall our planners put the emphasis on raising wages continually or on providing more and better free services like libraries, parks and public concerts? How much of the national income shall be saved for the purpose of new capital construction? And in this connection will the time come when the population will prefer to stabilize the standard of living at a certain point and concentrate on enjoying the consumers’ goods producible at that level rather than to continue with vast expansion programs? For under Socialist planning there is no categorical imperative, as under Capitalism, for an economy to keep on expanding indefinitely.

This particular issue might well develop in relation to the matter of the average annual working time. In order that more leisure be secured, one political party might advocate reducing the work-day by a third or augmenting the number of holidays or cutting the age of retirement to fifty; another party might call for the maintenance of existing work-time schedules and for a mighty increase in production which would lift the standard of living to even greater heights. Or another burning issue might come to the fore, once the necessities of life had been provided for everyone, over whether to stress the provision of cultural as distinct from material goods and services.

The exact planning techniques which I have been describing will certainly not be used in all stages of Socialism nor in all countries adopting the new system. For it is crystal clear that each nation will use somewhat different methods, adapting Socialism to its characteristic traditions, political institutions and degree of economic development. It would be foolish to imagine that if central planning were introduced in China at the same time as in the United States, it could be put into effect by precisely the same measures or at the same rate. Indeed, there will be plenty of differences even between two countries both as highly evolved industrially as

END NOTES: It is important to keep in mind that this was written in 1939 just before WWII.  Some adjustments were made to the socialist agenda as a consequence of the War, however, the basic goals remain the same today. I chose this for our first article on the progressive mind because I have witnessed during my lifetime many parts of its agenda being proposed or actually put in place by progressive Presidents and unconstitutional bureaucracies.

1. Corliss Lamont, You Might Like Socialism (1939) Modern Age Books, New York.

2. Great War= World War I

3. In 1939 dollars

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Social Capitalism

I have struggled for two weeks to get this posting out. Even as I write, I cannot reconcile exactly where I should stand on the issue of supporting businesses that absolutely offend my sensibilities as a consumer. The genesis of this posting began when I read about all of the companies that pulled their advertising from the Rush Limbaugh Show. I am not here to defend or support what Rush Limbaugh said,  (he can do that himself), only that he has the right to say whatever he wants. What struck me as appalling was the speed and efficiency in which the left was able to mobilize to bring Rush down. We all know, or should know, the progressives have entire organizations dedicated to listening to conservative voices, waiting for the perfect moment to be offended so that they can snuff out free speech they disagree with.

I must say that I was quite awestruck by the fact that a minority of people, 20% liberal if we go by the latest Gallup survey I could find, could force companies into action despite the fact that 42% of Americans identify themselves as conservatives in that same poll. (Apparently 38% of the people have no idea what they believe in, will not take a stand and they’re called moderates.) With self-righteous indignation I was angered by the fact that companies like Carbonite and ProFlowers.com would acquiesce so quickly to such a small group of people and while I don’t have the purchasing demographics for these companies, I almost have to believe that there are more people purchasing their products and services on the recommendation from a Beck or a Limbaugh or a Levine than the left could ever muster up the support for. (Full disclosure: I tried Carbonite based on one of these recommendations – it didn’t work for me – and I give my wife a box of Sheri’s Berries, a subsidiary of Provide Service which owns ProFlowers, every year, again based on one of these recommendations.)

The original intent of this posting was to point out the fact that these 26 or 27 companies had made a choice. In the name of social Marxism, they would cave to this small but highly vocal group despite the fact that people that label themselves as conservatives are the actual majority of the population. I intended to point out the fact that they could get away with this because we, as conservatives wouldn’t do a damned thing about it. This was going to be a rallying call to all conservatives that believe in the free markets and our freedom of speech to get out there and vote with your purchasing power and call these companies up and let them know that you will not do business with a company that has zero regard for you and what you believe in. All I needed was a few days to think about the best way to articulate how we can make a real difference by supporting other businesses that care about all of their customers. We would take on the defense of our causes by employing the lefts’ tactics. Saul Alinsky would not be remembered if his tactics did not work. And then the wheels started falling off in my thinking….

I believe in capitalism. Not the crony-capitalism of the General Electric / General Motors variety, but true free market capitalism. And while I stand firm on what I’ve previously mentioned, I can’t say that I’m for using the progressive tactic of calling for boycotts every time I disagree with someone. (Note: To be fair, I just found out that some conservatives are also looking at the tactic in the research of this article.) I’m not even sure how effective boycotts are, when they’re actually implemented. Off of the top of my head I do not recall hearing of a boycott that was truly effective in hurting a business’s bottom line. But then again, it’s hard to measure the effectiveness of what a boycott can actually do when any group of fifty people can call, claim they were offended, threaten a boycott and meet their goal of suppressing freedom of speech in the name of tolerance. (Don’t spend too much time thinking about that last sentence; it’s mind numbing when you do.)

However I do believe in personal responsibility when it comes to making purchasing choices but even this has significant downside. I pride myself for the fact that I refuse to pay money to HBO because of what Bill Maher spews out about people – specifically conservative women and people of faith. He has the right to be on cable and say whatever he wants and I have the right not to support the company that supports him. It is hard for me to understand why anyone that calls themselves conservative would pay HBO for their services so that HBO can pay Bill Maher for his services so that Bill Maher can donate one million dollars to a progressive super-PAC. This is an easy case for me to make because there are several choices out there for watching movies and while I do have some movie channels, I rarely watch movies anyway.

What about products this author really likes? I’ll apply the same logic to ice cream. Ben and Jerry’s has some of the best flavors put in pints and they’re everywhere and easy to get. But according to an ABC News story, founders Ben Cohen and Jerry Greenfield are giving money to the Resource Movement Group, a group designed to fund this year’s Occupy Wall Street protests. Their website openly supports everything I’m against. Using the same argument as delivered in the previous paragraph, every time I purchase a pint of Ben and Jerry’s, I’m paying Ben and Jerry to support and advertise for the OWS movement. So much for “Pistachio Pistachio” and “Everything But The…”. The argument for voting with your wallet remains as sound as ever but the practical application of that argument can be very difficult when the purchasers’ choice is to accept a product of lesser quality. I apologize in advance to the fans of Haagen-Dazs. I made the switch but they’re really not the same.

I’ve “war gamed” these issues with several different people over the past couple of weeks and the conversations ranged from, “whatever we do doesn’t make a difference anyway” to “well, if you’re going to stop buying Ben and Jerry’s, you should stop buying Unilever products as well since they own them”. If this is the case, I’ll need more time to get rid of my Lipton iced tea. I really don’t know what the “answer” is. My next jeans purchase will not be Levi’s. My next pint of ice cream will not be Ben and Jerry’s. My wife will get something that’s not Sheri’s Berries next Valentines Day. But is it even possible to stop doing business with every single company that pulled their advertising from the Rush Limbaugh show to make the point that we are the majority and respect the freedom of ideas – even if we don’t always agree with those ideas?

20% of the population has figured out a way to set the agenda for the entire country. They set the tone and decide what the rest of the country is allowed to say and how they are to say it. I read somewhere that Vladimir Lenin was able kick off the Russian Revolution with 10% of the population. We might want to figure this one out.

Authors Note: In my research for this posting I read a little about the history of Ben and Jerry’s Ice Cream. It is one of the greatest capitalism stories I have ever read all the way to the point that they even won the title of U.S. Small Business Persons of the Year, awarded by President Regan. And yet they support the anti-capitalist movement. Figure that one out.

Greece – The Canary in the Coal Mine

By now, just about everyone is aware that Greece has issues. But what’s a bit appalling is how little we know about what is really happening with that country. The knowledge most people have boiled down to two points; Greece has run out of money and the people there are rioting in the streets. However if one digs a little deeper, you’ll realize that Greece is essentially no longer a sovereign country – it is a country led by a technocrat and more or less owned by the EU and ECB. Before I get into the implications of what that means, let’s first go through the brief history of how Greece got to where it is today.

Between 1999 and 2008, Greece’s real GDP was hovering between 3-4% while their debt percentage hovered in and around 100% until 2008 where it stood at 113% during the global recession. In 2009, the newly elected Prime Minister George Papandreou came into office and soon after revises the country’s budget projections, indicating the government had been understating its deficit for years. That year Greece’s debt percentage shot to 129% and is currently standing at 173% projected. After several credit downgrades in 2009 and 2010, Papandreou agrees to implement harsh austerity measures in exchange for $152 billion in loans from the European Union and the IMF. Riots ensue as the Greek population does not want to give up anything. Despite Greece meeting the austerity requirements of 2010, credit ratings continue to be downgraded so Greece pushes through another set of highly unpopular austerity measures June 2011 to qualify for a second bailout package for $157 billion in loans. Shortly after this, the Greek parliament agrees to new highly unpopular taxes, cutting public sector jobs, decreasing public sector wages, decreasing pensions for high-income workers and scaling back collective bargaining rights.

In addition to this very brief recent history, it is also important to note how Greece got to this point in the first place. Ironically, it began 30 years ago Papandreou’s father Andreas began building an unsustainable civil service in order to continue winning elections. Additionally, Greece had spent the last few decades erecting social safety nets producing cradle to grave benefits such as government healthcare, a generous welfare system and a retirement age of 61, (social security). In fact, the entitlement mentality is so firmly entrenched in Greek society, the population there does not understand anything else and seems perfectly willing to give up its’ national sovereignty while devolving into a cesspool of pain and misery grasping at the last reed it can find while drowning. And because they have no basis for understanding true freedom and liberty, they are willing to live through the degradation of their country in the hopes that things might magically get better. Here are a few of the things that are going on in Greece that are getting very little press in the US.

  • After the collapse of the socialist party in November 2011, an interim prime minister, Lucas Papademos was sworn in to lead Greece through the economic crisis. Papademos is a technocrat and was previously vice president of the European Central Bank. (Could you imagine Ben Bernanke being sworn in as interim President?)
  • Having lost its fiscal independence, Greece is now required have the permanent presence of a Eurogroup Task Force with strong onsite monitoring capabilities. (In other words, it’s their money and they have the right to manage their money. Who owns the bulk of the US debt?)
  • This EU presence will ensure that state revenues will flow into a segregated escrow account for state revenues.
  • The Greek constitution will be amended to ensure that priority will be given to serving debt payments. This includes the right for European banks to seize Greece’s gold reserves, 111.6 tons.
  • Public sector salary cuts are so deep and because they are retroactive to November 2011, up to 64,000 workers will have to work without salary for a month and some may even be asked to return money.

There is far more to the Grecian condition than what I can post in this blog but the point is obvious. Greece’s socialistic experiment has been a complete and utter failure and from a practical perspective, they are no longer a sovereign country. And despite all of this, Greece is virtually assured to default anyway, only now with zero gold reserves.

Socially, the Greeks are feeling completely hopeless and are turning bitter towards the EU and specifically Germany. There are riots and lootings in the streets. Well dressed Greeks have been reported rummaging through the garbage for food. Clinics that were set up to service the immigration population in Greece have seen a 22% jump in the domestic population. And still, they’re clinging on to an idea that didn’t work – hoping against hope that it will all just go away

Understanding what is happening in Greece is essential when looking at our current economic situation. From a GDP perspective, the US is in a worse economic condition than Greece but we have the ability to print money. However, eventually every country will have to pay back the debt that they owe and Greece gives us a better understanding of what can happen when we fail to make the tough choices today. We cannot afford our current social programs and Obamacare begins to hit its stride in full in 2013. That means higher taxes and still more debt. Despite what’s lacking in our current healthcare system, Obamacare literally means the destruction of economy.

We have an opportunity this year to elect real leaders that will face our issues head-on. We need to repeal the healthcare bill and we need to seriously manage the scaling back of all of our social programs – social security, Medicare, food stamps, etc. We either face up to our issues with honesty and determination, or we will wake up one day and realize our country isn’t even ours anymore.

Mitch McConnell plays “Charlie Brown” on Washington Stage

According to an article in the Chicago Tribune, a compromise proposal crafted by Senate Majority leader Harry Reid and Senate Minority Leader Mitch McConnell is likely to come before the Senate for a vote this week. Under this compromise plan designed to increase the debt limit before the August 2 deadline, the President would be given the authority to raise the debt limit three times for a total increase of $2.5 trillion without Congressional approval,  in exchange for a series of budget cuts that would reduce the budget $2.5 trillion over the next ten years.

In this scenario, Mitch McConnell plays the role of the Peanuts cartoon character, “Charlie Brown” and Harry Reid plays the role of “Lucy” holding the football. The budget reductions promised over the next ten years are reminiscent of the character “Wimpy” in the old Popeye comic strip as he tells the counterman at the local diner, “I will gladly pay you Tuesday for a hamburger today”. Taking into account that the Tribune is a part of the MSM and this article comes out of their Washington News Bureau, the quotes of some conservative Republicans in Congress concerning the possibility of a last minute compromise is somewhat disconcerting.

It seems the Republican Leadership in Washington does not yet realize just how determined its conservative base is in taking back their country. By the same token, a large percentage of conservatives throughout the country do not yet realize that we are in the midst of a war between the socialists inside our government and the constitutional conservatives that make up a large part of the patriot or “tea party” movement. This war has been going on for the past 130 years and has now reached the critical stage. Make no mistake, this is a war with one side, the socialists or progressives, determined to destroy America, as we know it. Their goal is to destroy republicanism, capitalism, conservatism, the American culture and the U.S. Constitution. On the other side, the constitutional conservatives’ goal is to destroy socialism, purging it from the power structure of government and restoring the republican form of government designed by the Founders in the Constitution.

I was eleven years old when World War II ended. I did not understand at the time all the details behind the war but the one thing that made a lasting impression on me that I have never forgotten is the spirit of patriotism that permeated American society. No one would even think of compromising with the Axis Powers; the goal was to defeat them, totally and completely. The socialist in America have always understood the nature of the conflict we are engaged in and have been persistent and relentless in their attacks on the institutions of our government and culture. Conservative patriots have been on the defensive since the beginning of the socialist movement in the last quarter of the nineteenth century.

In the twentieth century, the socialist seemed to have lost most of the battles fought at the ballot box, in the courts and in the halls of Washington. Conservatives were content to defend their positions policy by policy with every contest ending in a compromise giving the socialists a little more ground. We are beginning to understand that compromise with socialists is simply another name for surrender.

For their part, the socialists never concede defeat. They simply accept the compromise and move forward to the next battle while the conservatives return to the mundane world of daily life. For example, universal, state-run health care has been a goal of socialism since the 1854 Bill for the Indigent Insane, vetoed by President Franklin Pierce because the Constitution does not give Congress the power to pass national welfare legislation. The push for universal health care was taken up again by President Theodore Roosevelt in the election campaign of 1912. Roosevelt was defeated and the issue lay dormant until revived by Franklin Roosevelt. The first bill for social security included publicly funded health care programs, but Roosevelt was forced to remove them from the Social Security legislation in 1935 while he sold Social Security to the American people as “insurance” and to the courts as a “tax”.

Socialists refused to accept these expressions of the American people’s will and kept on fighting for universal health care which they finally succeeded in getting passed into law, piece by piece, beginning with Medicare and Medicaid in 1965 and culminating in the health care bill, “Patient Protection and Affordable Care Act” passed by the Progressive Democrats led by Barack Obama in 2010. The hundred-year socialist vs. conservative contest over universal health care showcases the nature of the ongoing war for the future of America we are now engaged in.

As Israel has been demonstrating for the past fifty years, you cannot compromise with those who are determined to destroy you. In doing so, you merely let the enemy off the hook so they can regroup and return, even stronger, and as determined as ever in their mission of destruction. America cannot afford to compromise on the upcoming debt crisis. The Reid-McConnell compromise only assures that our national debt climbs to 17 trillion dollars in the short term, and the continuation of massive deficit spending in the long term.

America is not Soviet Russia or Communist China. Five-year and ten-year plans are meaningless in American politics because promises of future actions by Congress are binding only on the sitting Congress that makes the promise. They are not binding on future Congresses. The 112th Congress can plan and promise anything. The 113th Congress can do as they please because those promises are not binding on them. The only way we are going to return to fiscal stability and a thriving economy is to simply say NO to more debt, take the consequences and start over. That may mean short-term hardships for many but it will save the country for future generations.

It’s Time To Retire Both Political Parties

The Democratic Party has been in existence since 1825; the Republican Party since 1854. Both have failed the Country miserably.  Perhaps the time has come when we should think about abolishing both parties and establishing a new method for selecting candidates for elective office.

Conventional wisdom among conservatives is that we need to take over the Republican Party and regain control of Congress in the next two elections. That is not something we need do, it is something we absolutely must do if we are to have any hope of changing the direction the country is going.

Assuming though, that we are successful in returning Congress to Republican control in November, and assuming we are also successful in returning the Republican Party to the control of conservatives, then what? Is there any logical reason for continuing to give conservative support to it in the future? Political parties are a lot like service businesses, only with voters instead of customers. The service it provides to the public is finding and publicizing candidates for office. Conservatives have, for generations, given their time and money to the Republican Party with the expectation that its candidates, once in office, would enact legislation designed to protect our liberty and defend our Constitution and way of life. What person, in his or her right mind would continue supporting a business that never delivered the service it had agreed to provide?

Who would patronize an airline that never took them to the destination their ticket called for? Who would continue to employ a security firm to protect their business if thefts kept increasing year after year? That is exactly what we are doing with the Republican Party. Conservatives keep volunteering their time and donating their money, yet they never get what they work for and pay for. We have been conditioned to believe that strong political parties are necessary for the functioning of government. That may be true — but, we need to reexamine that assumption and, at a minimum, rethink what it is that we want our political parties to do for us.

There is no legitimate reason, based on our Constitution and founding documents, for allowing political parties to exercise the amount of power they have today over our government and the choice of leadership we have as citizens. When the Founders were designing our government with its balance of power, they designed it to balance the powers between the different branches of the federal government and between the federal government and the states. They did not and could not have envisioned that the stability of our nation and the security of our liberties would depend on a balance of power between two political parties.

For diagrams depicting the differences between the government established in 1989 and the government existing today see here and here.

The power of political parties has increased concurrently with the decline of federalism in our national government. The founders did not establish the United States as a consolidated “nation state”. The federal government was established by the Declaration of Independence as a federation of nation states, primarily for the purpose of mutual defense and international relations. The nature of the United States is described by Thomas Jefferson in the final paragraph of the Declaration.

“…These united colonies are and, of right ought to be free and independent States;…that as free and independent States, they have full power to levy war, conclude peace, contract alliances, establish commerce, and to do all other acts and things which independent States may of right do.”

This is the last occurrence of the word “colonies” in the official documents of the U.S. From that time forward, citizens of the various states considered their state to be their “country”. Whenever the word “country” appears in the personal writings of that era, it almost always refers to an individual state, rarely to the “United States” as a whole. The Declaration declares the states, in their individual capacity, to be free, independent, sovereign nation states, equal to any other nation state such as Spain, Great Britain, Germany, Poland, etc. It does not present them merely as parts of a larger consolidated “nation state”. Later governing documents, based on the Declaration of Independence does not change the fundamental nature of the states described in the Declaration. The essential and fundamental nature of the states in their declaration of independence, and in their successive governing documents is state sovereignty and independence.

Recognizing the shared threats to the individual states posed by other nations, and the common interest of the states in a few other issues, they organized an “umbrella” government for the common defense and certain other matters of common necessity. The Articles of Confederation, ratified by the states in 1781 describes this federation as,

…“A firm league of friendship with each other, for their common defense, the security of their liberties, and their mutual and general welfare, binding themselves to assist each other, against all force offered to, or attacks made upon them, or any of them, on account of religion, sovereignty, trade, or any other pretense whatever.” (Article III)

To preclude any attempts by the Federation to impinge on the individual sovereignty of the various states, they included this statement in Article II:

“Each state retains its sovereignty, freedom and independence, and every power, jurisdiction, and right, which is not by this Confederation expressly delegated to the United States, in Congress assembled.”

With the Articles of Confederation the states relinquished a small portion of their sovereignty to the “umbrella” government, namely, the powers of war and peace and the unfettered right to form alliances. All other powers were retained by the states.

Our second governing document, the Constitution of the United States, did not alter the fundamental sovereign nature of the states. The only additional sovereignty, of any consequence, relinquished to the federal government was the power to directly tax citizens rather than assessing the State Legislatures for the tax monies necessary to administer the federal government; granting the federal government the right to regulate interstate commerce to insure free trade between the states; coin money and operate the postal service; and the establishment of a national judiciary. The previously delegated powers of war, peace, and international alliances were also restated. Other than that, the states retained their full sovereignty.

Either by malicious intent or oversight, the statement of sovereignty contained in the Second Article of the Articles of Confederation was omitted from the Constitution. However, it was added at the insistence of the Anti-Federalist, with the Ninth and Tenth Amendments ratified in 1791.

“The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

With the formation of the Democrat Party, organized by Andrew Jackson in 1825, the real power of government began to shift from the people to political parties. For the past hundred and eighty-five years the two major political parties have competed with each other for the reigns of power. Party power has increased until today we are ruled over by an oligarchy consisting of the Speaker of the House, the Majority Leader of the Senate, the President, and the so-called “swing vote” of the Supreme Court, each representing the needs of their respective parties rather than the needs of the people and the states. Lip-service is given to the “sovereignty of the people” by allowing them to choose which of the two political parties will rule over them for the next two, four or six years. The constitutional form of government established by the Founders has all but been forgotten.

If we are ever to regain the liberty and freedom left to us by the Founding Fathers, it is imperative that we throw off the power exercised over us by political parties. This cannot be accomplished in one or two election cycles. Because of the six-year term of Senators, multiple election cycles will be required. However, it can be done with the concentrated and focused efforts of the American people. We can pass on to the next generation a free republican form of government envisioned by the Founders or we can pass on a socialist oligarchy, the choice is up to us.

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Will Third Parties Spoil the 2010 and 2012 Elections For Republicans?

“Those who refuse to learn the lessons of history are doomed to repeat it.” ~Santayana

An increasing number of conservatives and misguided patriots are considering supporting a third party in the 2010 and 2012 elections.  The traditional home of conservatives, the Republican Party, has been courting “moderates” for years, ignoring its conservative base. The Republican establishment is convinced that moderates are the key to winning elections because they believe only moderates can attract the independent voters necessary to win any election. Experience has shown this to be an erroneous assumption on the part of Republicans. On a level playing field moderates lose every time. Voters tend to gravitate to candidates with a clear set of values and the ability to articulate them.

As long as the main stream media keep promoting the moderate myth and party leaders keep believing it, the Republican Party will continue promoting moderates. Party leaders, like their counterparts in private business are always trying to increase “market share”. They do this by protecting the incumbents already in office and attempting to add to their share by gaining seats currently held by the opposition party. Both parties practice this tactic.  Democrats running in Republican districts try to sound conservative and Republicans running in Democrat districts try to sound progressive. The problem is that too many candidates on the Republican side actually are progressive Republicans.

Conservatives have become fed up with this game that ends up giving them a choice in the general election between a progressive Republican and a progressive Democrat. That is one reason why so many are considering a Third Party. Third parties have played an important role in American political history, but they do not win elections. That is not because they do not have good ideas; it is because of the “winner take all” system set up by the Founders. Whether it requires a majority to win or a plurality, the end result is the same. One of the two major parties win and third parties only become spoilers for the one most closely aligned with its own position.

The first candidate to run for President on a third party ticket was William Wirt in 1832, running on the Antimasonic ticket.  He got a whopping 7 electoral votes out of the 286 cast. John Floyd, running as an independent (no party) in the same election got 11 votes by comparison. The two major party candidates at the time, Democrat Andrew Jackson and National Republican Henry Clay, got 219 and 49 electoral votes respectively. The most successful third party candidates in Presidential elections were Theodore Roosevelt running on the Progressive Party ticket in 1912, Strom Thurmond running on the States Rights Democratic ticket in 1948, and George Wallace running on the American Independent ticket in 1968. State and local politics are different than Presidential politics because of the Electoral College, but the results are the same.

Third parties have succeeded in winning a smattering of elective offices at the state and local level out of the tens of thousands there are nationwide. Although third parties have had limited success in electing state and local candidates, those successes have always proven temporary, lasting only until the “Peter Principle” kicks in and they reach their level of incompetence. To understand the dynamics of third party influence, we have only to look at two modern examples of groups that have exercised a substantial influence over American politics.

Although the tea party movement is not a political party, no one can deny that they are having a tremendous influence on the political establishment in America today. They give us one of the models of the dynamics at work when third parties are effective in molding public opinion to their cause. The other model comes from the opposite end of the political spectrum, the Democratic Socialists of America.  What do these two groups have in common? Both have a remarkable influence in American politics, yet neither nominate candidates of their own. Instead they wield their influence by backing like-minded candidates in one of the two major parties; the tea parties in the Republican Party and the socialists in the Democrat Party.

To understand how effective this tactic is, consider the testimony of the Democratic Socialist of America itself as expressed in the Q & A section of their website.

Q. Aren’t you a party that’s in competition with the Democratic Party for votes and support?

A. No, we are not a separate party. Like our friends and allies in the feminist, labor, civil rights, religious, and community organizing movements, many of us have been active in the Democratic Party. We work with those movements to strengthen the party’s left wing, represented by the Congressional Progressive Caucus. (emphasis added)

The process and structure of American elections seriously hurts third party efforts. Winner-take-all elections instead of proportional representation, rigorous party qualification requirements that vary from state to state, a presidential instead of a parliamentary system, and the two-party monopoly on political power have doomed third party efforts. We hope that at some point in the future, in coalition with our allies, an alternative national party will be viable. For now, we will continue to support progressives who have a real chance at winning elections, which usually means left-wing Democrats.”

Using this tactic, progressives (American socialists) have succeeded in taking over the Democrat Party and now control the White House and both branches of Congress.  Conservatives do not need to reinvent the wheel, they simply need to follow the example of the tea parties and the socialists. In the end, as the socialists have discovered, third party candidacies always prove counter productive to their own goals. It is difficult to argue with the lessons of history.  The lesson is there and well stated by the DSA. We can only hope that conservatives learn it before it is too late.

For a discussion of the DSA’s role in giving us Barack Obama, see our post from a year ago, “Obama’s Four Year Plan

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