Day: February 10, 2024

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By Blake Scott Ball

There’s a common assumption among the older generations that today’s college students are more swayed by socialism than ever before. There’s fear that this generation may be lost to the alluring temptations of “free” government programs and centrally planned economies. As a college professor over the past seven years, I have not found this to be the case. 

Make no mistake, the heralds of central planning and redistribution have never had so many mass outlets for spreading their deceptions. I’m just not convinced that college students today are buying it. 

This is in part because college students don’t really know what they believe. Whether they realize it or not, the reason they’re in college, far beyond mere professional preparation or job training, is to learn how to think for themselves, beyond the received knowledge imparted to them by their parents and public schools. My experience in the college classroom — from a large state university, to a Historically Black College and University, to a religious liberal arts college — tells me that this generation is reachable. In fact, I see evidence that many of them desire clarity about the cluttered, confusing world around them.

I teach Adam Smith’s free market ideas in my modern World Civilizations course. Smith’s ideas are presented along with all sorts of other ideas like mercantilism, colonialism, Marxism, and fascism. What this historical perspective reveals is that, too often, today’s proponents of the free market have either lost sight of Smith’s original context or fail to include it in their pedagogy. 

Smith challenged the closed system monopolies of the mercantilist era in which he was born. That system was effectively an early modern corporatism, where monarchs granted and enforced trade monopolies for their favored merchants in exchange for a share of the profits to fund growing militaries and bureaucracies. Colonialism fed this bloated system by allowing monarchs to feed their pre-industrial economies with raw materials from Asia, Africa, and the Americas while artificially blocking the development of domestic markets in those places, keeping the colonies dependent upon the mother country for their manufactured goods.

Fortunately for modern man, the British peoples were far more industrious and ambitious than their monarchs were competent at managing their mercantilist fantasies. In many ways, the Scottish philosopher Adam Smith was more documenting and validating the organic new system emerging in the eighteenth century world than he was creating anything in his monumental Wealth of Nations, published in the revolutionary year of 1776. Through voluntary associations, he observed, the people were doing more to provide for their own prosperity than any king ever had. And they were doing it in ways that channeled self-interest into cooperation. It is hard to miss the marriage in Smith’s mind of the two most important intellectual movements of his day: the rational individualism of the Enlightenment with the Protestant’s conviction of the sacredness of work and the redeemability of even man’s most base behaviors.

So much of our understanding of Smith’s remarkable work, however, is understood today through a very different prism: that of Karl Marx. The very fact that we often credit Smith with “capitalism” reveals our anachronistic misunderstanding. It was Marx who applied this label to the system he so disdained in his adopted British haven, a label that placed all the emphasis upon his deepest obsession: material wealth. For Marx, the greatest needs of humanity are all physical and all, therefore, physically limited. There is only so much wealth to go around. There is so much food to go around. Those limitations, however, could be surmounted with the power of labor unleashed from control by the capitalists. We could have limitless goods, he figured, once we dismissed the capitalist system. It makes sense, then, why he invents the greatest of all modern fictions — an altruistic central state — to administer the needs of society and teach the greedy capitalists to share.

Too many of our discussions today about the free market concede the erroneous assumptions of Marxism. We spend too much time, I fear, combating the falsehoods of socialist evangelists. Apologetics are a crucial part of winning hearts and minds, no doubt. We have to correct errors. But I believe the greater path to convincing this generation of college students is by making the positive argument for the free market. That entails restoring to prominence the real case Adam Smith made for markets, individual liberty, and restrained government against the backdrop of official state control.

When I present Smith to my students, my argument is all about liberty. Smith wanted to unleash the potential of humanity from the artificial and counterproductive restrictions of mercantilism. He did this by recalibrating our relationship in two key realms: our relationship to other people and our relationship to wealth. 

By accepting that humans are by nature self-interested and refusing to cast that instinct as an unmitigated evil, Smith argued that the best path to meeting our own interests was to serve the interests of our neighbors in commerce. Free trade offers people the liberty to specialize in what they can best offer to their community and enjoy the abundance of their neighbors’ talents to meet their own deficiencies. And so Smith reimagined our relationship with one another not to ultimately be one of cutthroat competition, but instead of considerate cooperation, where I meet my needs and wants by serving yours.

Smith set out to unleash the creative potential of humanity. It was not the raw materials in the ground that accounted for the world’s greatest resources. It was human ingenuity. Human beings decide what a thing’s value is, whether that be a material, a service, or most profoundly, an idea. Wealth would be created, not by the inefficient and retrograde alliances of monarchs and mercantilists, but by the sheer creative force of the people. The people would generate the ideas and the people would pick (in a thousand individual choices that would combine into one unmistakable mandate) which direction the future would turn. Smith’s system incentivized creativity and, in so doing, transformed the economy of the modern world into the greatest and most democratic moment of human flourishing history has ever seen.

When we present the free market as liberty to meet my needs through serving the needs of others and as freeing the creative powers of all humanity to invent the future, today’s college students see a vision they can believe in. Our teaching and public advocacy efforts on behalf of free markets should insist on these types of histories that provide concrete evidence of how a free economy can uplift people’s lives.

• About the author: Blake Scott Ball is Associate Professor of History at Huntingdon College and author of Charlie Brown’s America: The Popular Politics of Peanuts (Oxford University Press, 2021). His research has been featured in Time magazine and on PBS, NPR, the London Timesradio, and CNN radio.  His book was favorably reviewed in the Wall Street Journal, The New Republic, Financial Times, and the Journal of American History. He has previously written for Washington Post, The Bulwark, and the Acton Institute. He regularly speaks to both academic and public audiences, including at Oxford University, Town Hall Seattle, and SMU’s Center for Presidential History.
• Source: This article was published by AIER

By Jon Miltimore

A squad of FBI and Drug Enforcement Administration agents in March 2021 raided the Beverly Hills location of a company, U.S. Private Vaults, suspected of criminal activity.

Over several days, agents wearing masks photographed evidence, seized jewels, gold bullion, and coins, and confiscated some contraband (mostly drugs) from 1,400 safe-deposit boxes rented by an array of people, including a retired doctor, a saxophone player, a retired floor contractor, and at least two attorneys. 

The grand total seized by the FBI was $86 million in cold cash, as well as Rolex and Cartier watches, rare coins, and more silver and gold than even Yukon Cornelius could imagine.

U.S. Private Vaults, which was headquartered in Nevada, pleaded guilty to charges of money laundering and conspiracy the following year. (No one went to prison, and the company is no longer in business.) But it turns out U.S. Private Vaults wasn’t the only party that broke the law. 

Last month, the U.S. 9th Circuit Court of Appeals ruled that the bureau violated the constitutional rights of safe-deposit box holders whose property was seized without probable cause, something the warrant explicitly prohibited.

To understand just how far the FBI overstepped its authority, it’s worth examining the case of Don Mellein, a retired civil servant from California. 

Mellein was one of hundreds of people who had a safe-deposit box at U.S. Private Vaults, where he kept hundreds of thousands of dollars of coins for safekeeping. 

When the FBI raided U.S. Private Vaults, it didn’t just search Mellein’s safe-deposit box. It seized his coins, something the FBI had explicitly said it wouldn’t do when it requested a warrant to raid U.S. Private Vaults (more on that in a minute).

Numerous other plaintiffs such as Mellein had their property taken simply because they were unlucky enough to have entrusted it to a company that was involved in some degree of criminal activity.

That the FBI had the chutzpah to ignore the judge’s warrant, which explicitly “d[id] not authorize a criminal search or seizure of box contents,” did not sit well with the court. 

Judges called the seizures “egregious” and “outrageous” during oral arguments, comparing them to the Revolutionary War practices of the British, who would search and seize the property of colonials without probable cause.

“It was those very abuses of power,” the 9th Circuit Court noted, “that led to adoption of the Fourth Amendment in the first place.”

The Fourth Amendment protects the “right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures,” but it’s something for which the FBI agents had little regard.

Indeed, depositions from FBI agents suggest that “forfeiting” the property of safe-deposit box holders — some would call it “stealing” — was the FBI’s plan from the very beginning. 

Excerpts of those depositions, which can be read at the Los Angeles Times and Reason, make it clear that the FBI had been planning a massive asset forfeiture operation months prior to filing its affidavit with U.S. Magistrate Judge Steve Kim.

They also reveal that the FBI had been planning all along to seize the contents of all safe-deposit boxes, so long as they contained at least $5,000 (the minimum established by the Justice Department’s Asset Forfeiture Policy Manual). Testimony makes it clear the FBI was not particularly concerned whether these people were actually criminals, or that the agent who submitted the affidavit had assured Kim that the property rights of customers would be respected.

We only know all of this because a judge denied a request from the U.S. attorney’s office — surprise, surprise — to block disclosure of those depositions, laying “bare the government’s deception,” in the words of the Los Angeles Times reporter Michael Finnegan. 

To call the FBI’s actions deceptive is an understatement. 

Finnegan’s reporting shows FBI agents and U.S. attorneys behaving in almost mafialike fashion, demanding bank records, tax returns, and sworn statements from safe-deposit box holders and their family members — just to get their own money back!

When you read how a U.S. attorney asked a glassmaker’s lawyer how much his client was willing to pay the feds to give him his money back, you realize the 9th Circuit was not engaging in hyperbole. The FBI’s raid is not dissimilar to the “writs of assistance” that permitted Red Coats “to break open doors, Chests, Trunks, and other Packages” to find contraband or “stolen” items, a practice despised by the Colonials. 

“It is a power that places the liberty of every man in the hands of every petty officer,” the 18th century statesman James Otis said in a famous speech against the writs, which led to the eventual adoption of the Fourth Amendment. 

The question now is: Who will be held accountable for the FBI’s lawless, shameless raid?

• About the author: Jonathan Miltimore is the Editor at Large of FEE.org at FEE.
• Source: This article was published by FEE. This article first appeared in The Washington Examiner.

Statistics are often given lanky legs that take their user far.  But how they are used, and how they are received, is striking.  The current figure of 27,500 dead is a blighting, grotesque fact.  But as they are Palestinians, the issue is less significant to certain parties than, say, 140 Israeli hostages being held in Gaza. 

As with much in the noisy clatter of Middle Eastern violence, the value attributed to numbers alters in the shade of ideology and self-interest.  Massacres become acts of self-defence; acts of self-defence become unconscionable inflictions of murder.  It also follows that an organisation of 30,000 employees, working in the field of humanitarianism, aid and salvation, can be plastered as terrorist sponsors for having 12 individuals in their service allegedly involved in a murderous assault on Israel on October 7, 2023.  Despite the relative smallness of this figure, the entire organisation itself becomes a target.

What, then, of the evidence?  The state of Israel was initially adamant that 12 such individuals in UNRWA (United Nations Relief and Works Agency for Palestine Refugees in the Near East) had participated in the October 7 attacks by Hamas, sharing the details on January 29 with several media outlets.  The accusations were made via a thin dossier amounting to no more than six pages.  Little by way of evidence was supplied, though Israel was content to make further claims that almost 10% of the agency’s staff had ties to Hamas.  As UN Crisis Group expert Daniel Forti writes, “Thus far, Israel has not provided evidence in writing to the UN to substantiate its allegations.”  

For a gaggle of Western states and donors, that hardly mattered.  The mere mention of the Satanic Twelve had made their way into public and political consciousness, and something had to be done about it.  Funding to the aid body was swiftly suspended by the United States, Germany, the European Union, Sweden, Canada, Australia and the United Kingdom.  The organisation was smeared and threatened with functional incapacity and prospective oblivion, an outcome that would also, inevitably, doom Palestinians.  Unchallenged accusations that the agency had long been a Hamas front – an article of faith among Israeli nationalists – were bandied about with abandon. 

The United Nations, for its part, was unusually fleet footed in responding to the dossier.  Contracts were terminated.  Inquiries were announced, along with promises of stern self-examination, purging and cleansing.  On February 5, the UN Secretary General António Guterres announced that an independent panel had been created with the specific purpose of assessing “whether the agency is doing everything within its power to ensure neutrality and to respond to allegations of serious breaches when they are made.”  The panel will be chaired by former French Foreign Minister Catherine Colonna, who will work alongside a Scandinavian complement of the Raoul Wallenberg Institute in Sweden, the Chr. Michelsen Institute in Norway and the Danish Institute for Human Rights.

With the setting up of such heavy machinery, the picture started getting foggier.  Then a smiting report from the British news outlet Channel 4 took issue with the scanty material supplied in the document.  As the network’s Lindsey Hilsum stated, “We got hold of Israel’s dossier against UNRWA – why did the donors including the UK withdraw funding on such flimsy unproven allegations before an investigation?”  

Channel 4 goes on to reveal that the dossier “contains no evidence to support Israel’s explosive new claim other than stating, ‘From intelligence information, documents, and identity cards seized during the course of the fighting, it is now possible to flag around 190 Hamas and Palestinian Islamic Jihadi terrorist operatives who serve as UNRWA employees.  More than 10 UNRWA staffers took part in the events of October 7.”  

Even the usually less than critical CNN network reported that it had “not seen the intelligence that underlies the summary of allegations”, going on to mention that the summary did “not provide evidence to support its claims.”

When Ophir Falk, an advisor to Israeli Prime Minister Benjamin Netanyahu, was asked by CNN anchor Anna Coren to provide evidence of the claims, he refused to do so.  When asked why the alleged culprits had not been arrested, he merely replied that “the first step is for them to be fired”.

Outlets such as The New York Times and Wall Street Journal were less than concerned by the gaping lacunae and skimpiness of Israel’s case.  Instead, the latter could even go so far as to claim that the dossier provided “the most detailed look yet at the widespread links between the UNRWA employees and militants.”  The ABC World News Tonight was clumsy enough to suggest that the UN had “not denied the claims”, implying a veneer of veracity.

Now, other countries are finding absence of evidence from the Israeli side more than awkward.  Australia’s Foreign Minister, Penny Wong, had to also admit that she had not been furnished with much in the way of evidence.  “We have spoken to the Israelis and we have asked for further evidence,” she told the Australian Broadcasting Corporation’s 7.30.  When asked why she did not ask UNRWA chief Philippe Lazzarini about the subject, she simply reiterated the point that she had asked the Israelis directly and was not aware if Lazzarini had evidence.  “He may, I don’t know what he has.”

With trademark oiliness, Wong countered that the allegations were what mattered.  “I think it is clear from UNRWA’s own actions that they regard these allegations as serious.”  They had done so by “terminating the employment of a number of employees and putting in place an inquiry – in fact, there are two inquiries.”  Effectively, the agency was to be punished for its own enterprising efforts to investigate the claims, leaving the accusers free to level whatever charges they saw fit.

In the meantime, Lazzarini has been scrambling to fill the funding void, making visits to the United Arab Emirates, Qatar, and Kuwait.  The dying and starvation in Gaza continue with the prospect of even more horror as Israel’s armed forces prepare their offensive on Rafah.  A fine thing, then, to see donor countries for UNRWA, some of whom continue funding Israel’s military efforts, to moralise about terrorists and the agency.

By Ryan McMaken

According to a new report from the federal government’s Bureau of Labor Statistics last Friday, the US economy added 353,000 jobs for the month of January while the unemployment rate held at 3.7%. CNN news was sure to tell us that this was a “shockingly good jobs report” and it “shows America’s economy is booming.” 

At this point, many of us who follow these numbers have become accustomed to the routine: the BLS reports “blowout” jobs numbers each month, and the legacy media dutifully reports that the jobs growth is astoundingly good, proving all is well in the economy. 

The media rarely reports on any other economic indicators with nearly as much enthusiasm. The monthly jobs report—well, one specific statistic within it—has become something of a proxy for the state of the economy overall. 

There are a couple of problems with this approach, of course. The first is that the jobs numbers—a trailing indicator of economic growth (or decline) are repeatedly contradicted by at least half a dozen other economic indicators. Many of these other indicators are, unlike jobs numbers, leading indicators, and are more useful if we’re actually looking for some hints at what is in store.

If we take a larger look around, we find this: The Philadelphia Fed’s manufacturing index is in recession territory. The same is true of the Richmond Fed’s manufacturing survey. The Leading Indicators index keeps looking worse. The yield curve points to recession. Business bankruptcies surged 58 percent in 2023. Net savings turned negative for only the second time in decades. The economic growth we see is being fueled by the biggest deficits since covid. 

But, there’s also the problem that the jobs report itself isn’t so impressive once we look beyond the headline establishment survey jobs data. 

The first fly in the ointment of this “shockingly good jobs report” is the results we see from the household survey. The household survey is a survey of actual people who are asked if they are employed. The establishment survey, on the other hand, is a survey only of large employers and the total number of jobs—i.e., not job holders. 

So, if we look at the household survey, we find that there were actually job losses in January. While the establishment survey showed an increase of a whopping 353,000 jobs, the household survey showed a loss of 31,000 employed persons. Moreover, January was the second month in a row for job losses in the household survey. In December, the report showed a loss of 683,000 employed persons. That was the biggest loss since the covid collapse. 

How does this square with the huge jobs blowouts in the establishment survey? Part of it can be explained by the fact that the establishment survey does not distinguish between full-time and part-time workers or jobs. It’s entirely possible that there are more jobs being added in the economy—it’s just that many of them are going to people holding multiple jobs, and many of those jobs are part time. So, if the economy is filling up with fewer people holding two or more part time jobs, that registers as “blowout” jobs growth. The reality, however, is that fewer people are employed. 

Moreover, the household survey also tells us that job growth among the employed was mostly driven by part-time jobs in January. According to the survey, growth in part-time jobs totaled 96,000 while full-time job growth went negative, with a loss of 63,000. 

Meanwhile, government jobs in January totaled more than 20 percent of all new year-over-year job growth. Outside of covid, we haven’t seen those sorts of numbers since late 2007 as the economy was nearing recession. 

And then there is the growth rate of temp jobs. That remained in negative territory last month for the fifteenth month in a row. As the graph shows, drops in temp jobs over the past thirty years has been a clear indicator of an approaching recession. 

Finally, we can look at real wage growth. Legacy media sources were careful to crow about how January showed real growth in average earnings. Specifically, average earnings (adjusted to the CPI) increased 1.7 percent, year over year. In a vacuum, that might be a great number. However, workers are still recovering from a 25-month period of falling real average earnings. That meant earnings on average in 2022 were below 2019 earnings, and working only started to come out of that hole in 2023. Indeed, if we look at real earnings growth since February 2020—the last month before the covid lockdowns—we find that earning increased a mere 1.53 percent—or 51 cents—over that 47-month period. During that same time, home prices increased 46 percent (according to Fannie and Freddie). It’s easy to see why housing affordable is now at some of the worst levels we’ve seen in decades. 

In spite of all this, however, American consumers of television news are fed a steady diet of good news about the economy in which each month brings a new “shockingly good” or “robust” jobs report. Even more questionable is the practice of treating the jobs report as if it’s an index for the overall economy. However, the jobs report is only something to brag about if one’s definition of a strong jobs economy is one in which fewer people have jobs, full-time jobs are disappearing, and government jobs are a growing component of overall job growth.

When we view these numbers in light of declining manufacturing, more bankruptcies, recessionary leading indicators, and negative net savings, we might suspect that the economy is headed for some turbulence ahead. 

The Federal Reserve, however, has encouraged the laser-like focus on current jobs data because the FOMC has claimed to be basing much of its economic planning on jobs growth. Approximately every month, for example, Jerome Powell addresses the press with a prepared statement about the Fed’s policy being this or that while using jobs numbers to justify its current policy. At least, that is the public face the Fed puts on. The Fed wants the public to believe the Fed is “data driven” and is fine-tuning—another term for centrally planning—the economy based on fine detective work from Fed economists. That’s the story they tell. The reality is something different, and the Fed is making its decisions based on political expediency. Polls have shown, however, that the average voter tends to base his opinion of the economy on the jobs situation “right now.” So, lo and behold, the Fed says it is doing the same. 

The economy doesn’t work that way, though, and if we want to understand what direction the economy is heading in, we have to rely on sound theory rather than what some Federal bean counters say happened last month.  

• About the author: Ryan McMaken (@ryanmcmaken) is executive editor at the Mises Institute. Send him your article submissions for the Mises Wire and Power and Market, but read article guidelines first. Ryan has a bachelor’s degree in economics and a master’s degree in public policy, finance, and international relations from the University of Colorado. He was a housing economist for the State of Colorado. He is the author of Breaking Away: The Case of Secession, Radical Decentralization, and Smaller Polities and Commie Cowboys: The Bourgeoisie and the Nation-State in the Western Genre.
• Source: This article was published by the Mises Institute

The source did not tell Reuters if there were any casualties from the attacks. 

Coalition troops and the Kurdish-led Syrian Democratic Forces (SDF), who together fight remnants of the Islamic State group, have faced increased attacks by Iran-backed groups in Syria and Iraq since Hamas’ terror attack against Israel on October 7. 

The head of the SDF, General Mazloum Abdi, told Reuters last week that the U.S. should send additional air defense systems to Syria to protect their bases after six SDF fighters were killed in one of the drone attacks. 

Another drone attack blamed on Iran-backed groups on a border outpost in Jordan killed three U.S. soldiers and injured more than 30 service members late last month.