Property and Liberty

Why Mises? (and not Hayek) - by Hans-Hermann Hoppe

2019-10-22T09:59:00.000-07:00

Let me begin with a quote from an article that my old friend Ralph Raico wrote some 15 years ago:

Ludwig von Mises and F. A. Hayek are widely considered the most eminent classical liberal thinkers of this century. They are also the two best known Austrian economists. They were great scholars and great men. I was lucky to have them both as my teachers.… Yet it is clear that the world treats them very differently. Mises was denied the Nobel Prize for economics, which Hayek won the year after Mises's death. Hayek is occasionally anthologized and read in college courses, when a spokesman for free enterprise absolutely cannot be avoided; Mises is virtually unknown in American academia. Even among organizations that support the free market in a general way, it is Hayek who is honored and invoked, while Mises is ignored or pushed into the background.

I want to speculate — and present a thesis — why this is so and explain why I — and I take it most of us here — take a very different view. Why I (and presumably you) are Misesians and not Hayekians.

My thesis is that Hayek's greater prominence has little if anything to do with his economics. There is little difference in Mises's and Hayek's economics. Indeed, most economic ideas associated with Hayek were originated by Mises, and this fact alone would make Mises rank far above Hayek as an economist. But most of today's professed Hayekians are not trained economists. Few have actually read the books that are responsible for Hayek's initial fame as an economist, i.e., his Monetary Theory and the Trade Cycle and his Prices and Production. And I venture the guess that there exist no more than 10 people alive today who have studied, from cover to cover, his Pure Theory of Capital.

Rather, what explains Hayek's greater prominence is Hayek's work, mostly in the second half of his professional life, in the field of political philosophy — and here, in this field, the difference between Hayek and Mises is striking indeed.

My thesis is essentially the same one also advanced by my friend Ralph Raico: Hayek is not a classical liberal at all, or a "Radikalliberaler" as the NZZ, as usual clueless, has just recently referred to him. Hayek is actually a moderate social democrat, and since we live in the age of social democracy, this makes him a "respectable" and "responsible" scholar. Hayek, as you may recall, dedicated his Road to Serfdom to "the socialists in all parties." And the socialists in all parties now pay him back in using Hayek to present themselves as "liberals."

Now to the proof, and I rely for this mostly on the Constitution of Liberty, and his three volume Law, Legislation, and Liberty which are generally regarded as Hayek's most important contributions to the field of political theory.

According to Hayek, government is "necessary" to fulfill the following tasks: not merely for "law enforcement" and "defense against external enemies" but "in an advanced society government ought to use its power of raising funds by taxation to provide a number of services which for various reasons cannot be provided, or cannot be provided adequately, by the market." (Because at all times an infinite number of goods and services exist that the market does not provide, Hayek hands government a blank check.)

Among these goods and services are

protection against violence, epidemics, or such natural forces as floods and avalanches, but also many of the amenities which make life in modern cities tolerable, most roads … the provision of standards of measure, and of many kinds of information ranging from land registers, maps and statistics to the certification of the quality of some goods or services offered in the market.

Additional government functions include "the assurance of a certain minimum income for everyone"; government should "distribute its expenditure over time in such a manner that it will step in when private investment flags"; it should finance schools and research as well as enforce "building regulations, pure food laws, the certification of certain professions, the restrictions on the sale of certain dangerous goods (such as arms, explosives, poisons and drugs), as well as some safety and health regulations for the processes of production; and the provision of such public institutions as theaters, sports grounds, etc."; and it should make use of the power of "eminent domain" to enhance the "public good."

Moreover, it generally holds that "there is some reason to believe that with the increase in general wealth and of the density of population, the share of all needs that can be satisfied only by collective action will continue to grow."

Further, government should implement an extensive system of compulsory insurance ("coercion intended to forestall greater coercion"), public, subsidized housing is a possible government task, and likewise "city planning" and "zoning" are considered appropriate government functions — provided that "the sum of the gains exceed the sum of the losses." And lastly, "the provision of amenities of or opportunities for recreation, or the preservation of natural beauty or of historical sites or scientific interest … Natural parks, nature-reservations, etc." are legitimate government tasks.

In addition, Hayek insists we recognize that it is irrelevant how big government is or if and how fast it grows. What alone is important is that government actions fulfill certain formal requirements. "It is the character rather than the volume of government activity that is important." Taxes as such and the absolute height of taxation are not a problem for Hayek. Taxes — and likewise compulsory military service — lose their character as coercive measures,

if they are at least predictable and are enforced irrespective of how the individual would otherwise employ his energies; this deprives them largely of the evil nature of coercion. If the known necessity of paying a certain amount of taxes becomes the basis of all my plans, if a period of military service is a foreseeable part of my career, then I can follow a general plan of life of my own making and am as independent of the will of another person as men have learned to be in society.

But please, it must be a proportional tax and general military service!

I could go on and on, citing Hayek's muddled and contradictory definitions of freedom and coercion, but that shall suffice to make my point. I am simply asking: what socialist and what green could have any difficulties with all this? Following Hayek, they can all proudly call themselves liberals.

In distinct contrast, how refreshingly clear — and very different — is Mises! For him, the definition of liberalism can be condensed into a single term: private property. The state, for Mises, is legalized force, ~~and its only function is to defend life and property by beating antisocial elements into submission. As for the rest, government is~~ "the employment of armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential feature of government is the enforcement of its decrees by beating, killing, and imprisonment. Those who are asking for more government interference are asking ultimately for more compulsion and less freedom."

Moreover (and this is for those who have not read much of Mises but invariably pipe up, "but even Mises is not an anarchist"), certainly the younger Mises allows for unlimited secession, down to the level of the individual, if one comes to the conclusion that government is not doing what it is supposed to do: to protect life and property. And the older Mises never repudiated this position. Mises, then, as my own intellectual master, Murray Rothbard, noted, is a laissez-faire radical: an extremist.

10/04/2011 - Hans-Hermann Hoppe

Observations on Hayek’s Plan by Mises

2019-10-22T08:55:00.000-07:00

Abstract: This memorandum was written at the request of Henry Hazlitt to provide Mises’s comments on and concerns about F.A. Hayek’s initial proposals for what became the Mont Pèlerin Society. Mises stresses that those who favor liberty and freedom and oppose totalitarianism must also oppose interventionism. The memo argues that those who fought and lost against the rising tide of totalitarianism at the turn of the 20th Century lost their battles because they settled for middle-of-the-road policies that conceded considerable ground to the socialists. The weak point in Professor Hayek’s plan is that it relies upon the cooperation of many men who are today’s middle-of-the-roaders. As interventionists, they may not be the hoped-for intellectual pioneers to inspire people to build a freer world.

In the last sixty or eighty years in every country eminent citizens have become alarmed about the rising tide of totalitarianism. They wanted to preserve freedom and Western civilization and to organize an ideological and political movement to stop the progress on the road to serfdom.

All these endeavors failed utterly; the parties and groups dedicated to their realization very soon disappeared from the public scene. Even their names fell into oblivion.

The cause of this lamentable failure was that the founders of these movements could not emancipate themselves from the sway of the very ideas of the foes of liberty. They did not realize that freedom is inextricably linked with the market economy. They endorsed by and large the critical part of the socialist program. They were committed to a middle-of-the-road solution, to interventionism.

What these frightened intellectuals did not comprehend was that all those measures of government interference with business which they advocated are abortive. They necessarily bring about a state of affairs which, from the point of view of their own advocates, is more undesirable than the conditions of the unhampered market economy which they were designed to alter. If the governments and the peoples neither want to acquiesce in this unsatisfactory result nor to abandon any further interference with the market and to return to full economic freedom, they must add to their first measures more and more regimentation until finally the Nazi Zwangswirtschaft with all its implications emerges. All those evils which the interventionists charge to the market economy are the products of allegedly beneficial interference. Credit expansion results in an artificial boom and then in a crash. Minimum wage rates, whether enforced by government decree or by labor union pressure and compulsion, result in mass unemployment prolonged year after year. The pernicious effects of protectionism and inflation are obvious.

He who wants to preserve freedom must not parrot-like repeat the catch-words of the totalitarians. He must not talk about the compatibility of economic regimentation and freedom for the individual. He must not protest that he abhors laissez faire.

Laissez faire does not mean: let the evils last. It means: let the consumers, i.e., the people, decide—by their buying and by their abstention from buying—what should be produced and by whom. The alternative to laissez faire is to entrust these decisions to a paternal government. There is no middle way. Either the consumers are supreme or the government.

It is vain to speak of government interference to make people free and to reestablish competition. What makes for freedom—political, intellectual and religious as well as economic—is not government interference, but the market economy. No government interference is needed to prevent the emergence of monopoly prices. Not the unhampered market, but the governments foster monopolization. The much talked about decline of competition is a product of protectionism, of intergovernmental commodity trade agreements and of many other similar measures. Remember the New Deal’s N.R.A. Remember the story of the German cartels as narrated in my book Omnipotent Government (pp. 66–78, 158–159, 245–251).

Those who want to preserve freedom must ask for free trade, both domestic and foreign, for the gold standard, and for ~~the reestablishment of the governments’ exclusive right to resort to violent coercion and suppression (this involves~~ the abolition of the labor union privilege to “punish” strikebreakers).

Of course all these things are very unpopular. But if they were popular, there would not be any need for a new party. The practical politician must take into account the voters’ reaction to his program if he wants to succeed in the short run. He must compromise. But the intellectual pioneer of a better world is not restricted by the concerns of Realpolitik. His program must be sound. It is only a sound program that triumphs in the long run.

The weak point in Professor Hayek’s plan is that it relies upon the cooperation of many men who are known for their endorsement of interventionism. It is necessary to clarify this point before the meeting starts. As I understand the plan, it is not the task of this meeting to discuss anew whether or not a government decree or a union dictate has the power to raise the standard of living of the masses. If somebody wants to discuss these problems, there is no need for him to make a pilgrimage to the Mount Pèlerin. He can find in his neighborhood ample opportunity to do so.

Karachi as a province

2019-10-14T09:17:00.001-07:00

S. Akbar Zaidi
January 11, 2014

THERE is little disagreement on the suggestion that Pakistan needs many more provinces than the existing four (five, if one includes Gilgit-Baltistan). From aspects of political economy to being able to better administer smaller units, many arguments support the idea of numerous new provinces.

The argument that more provinces would break Punjab’s hegemony over the rest of Pakistan and parts of what currently constitute Punjab itself are equally valid. A Seraiki and Hazara suba are a key requirement for the people of those regions. It has been suggested that the older 12 divisions of Pakistan, with modifications, should become provinces or autonomous administrative units. One of them was Karachi Division.

The issue of making Karachi a province is laced with emotion. Any such demand is seen as incendiary and challenges the supposed integrity of the Pakistani nation-state. Karachi’s political economy must be studied to consider whether a city of 20 million could exist as a province or even as an independent territory.

Karachi is Pakistan’s most developed economic and social administrative entity. In almost every economic and social indicator, it tops the list of Pakistan’s 106 districts. In terms of literacy, based on the 1998 census, Karachi has the second highest literacy ratio after Islamabad (72.4pc) with 72.2pc. However, Karachi Central has the highest literacy ratio in Pakistan with 76pc. In the case of female literacy, Karachi Division has a higher literacy rate than any other district in Pakistan at 63.9pc — Karachi Central has a literacy ratio of 73.9pc and Karachi East 70.1pc.

A study by Syed Ashraf Wasti and Minhaj Uddin Siddiqui, ranking 101 Pakistani districts according to the level of socio-economic development and using various indicators and statistical techniques, ranked Karachi on top or second. Similarly, Haroon Jamal and A.J. Khan computed and ranked the districts according to an index of multiple deprivation and established that Karachi was the ‘least deprived district’ of Pakistan, with the least incidence of poverty.

It’s not surprising that Karachi dominates much of Pakistan’s revenue collection statistics. Much of Pakistan’s economic, manufacturing, services and related production and value addition still takes place here. Karachi contributes more than 35pc of all Pakistan’s direct taxes. Of the share of direct taxes and revenue collection in Sindh, Karachi contributes almost 96pc of the province’s share; it also provides around 35pc of total sales tax collected in Pakistan showing a strong consumer base.

It is critical to examine demographic and linguistic structure and trends in Karachi before making political demands related to creating a new province. Many important facts about Karachi must be highlighted. Karachi’s population growth rate over the last few decades has been falling and may have stabilised. The next census might reveal different figures, but this is what we have right now.

Importantly, the migrant population in Karachi fell from almost 33pc in 1981 to near 22pc in 1998 — not surprising given the first wave of migrants to Karachi from India completely changed the city’s demography. Migration is slower now, and almost all from within Pakistan. This has a major impact on the future of Karachi’s demographics.

As more migrants have come to Karachi from the rest of Pakistan, despite a stable growth rate for the city, the proportion of non-Urdu speakers has increased. Haris Gazdar predicts that by 2025, non-Urdu speakers would constitute 60pc of Karachi’s population.

Given the desire for more provinces, arguments have been made for making Karachi a province. While serious political factors would inhibit such a move, it seems clear, using limited data conducting static and non-dynamic analysis ie, not considering the repercussions, that if Karachi was made a separate entity — a province — it is likely to be better off economically.

This statement is clearly limited and comes with ‘ifs and buts’, but on the surface it seems that since Karachi contributes 95pc of the revenues collected from Sindh, if these were allocated to Karachi and the money stayed with it, it would have a major, positive impact on the city. Karachi would not need additional federal government assistance.

Under a redefined, negotiated agreement with the centre, with much of the self-generated revenue kept for it, Karachi would be more than self-sufficient and would have a surplus too, ~~some of which could be transferred to the centre or the other provinces~~. There’s little doubt that the existing economic base of Karachi, ceteris paribus, would allow Karachi ample resources to develop and be self-sufficient with a surplus.

However, Karachi’s linguistic distribution raises complicated issues. Unlike a Seraiki province, or one in the Hazara or Potwar region, Karachi’s population is not homogenous. Karachi is no longer an Urdu-speaking city. It is a hugely multi-ethnic, multi-linguistic city. Urdu speakers, while the main ethnic group, are by no means the dominant majority.

Any attempt to make a province only on linguistic lines would face the consequences of pressure and opposition from other ethnic groups in Karachi. As a province, Karachi would need to accommodate all the different linguistic and cultural groups living in the city. It might even address the issue of ethnic differences, since Karachi province would speak for the people of Karachi, regardless of their ethnicity.

Karachi has benefited from the huge contribution of numerous ethnic groups in Pakistan who have either migrated here or who supply skills or capital. Karachi province could be beneficial for all its residents regardless of the language they speak. Incidentally, the same arguments would apply to a strong and autonomous city government as well.

The writer is a political economist.

Source: https://www.dawn.com

(Emphasis added)

Is PDA a crime in Pakistan?

2019-10-13T07:50:00.001-07:00

Young couples, know your rights the next time you're stopped by a cop

KARACHI: As evening falls in Karachi, Ahmed* and his girlfriend Manahil* head out on a dinner date. This wasn’t just any date, the 24-year-old wanted to surprise his girlfriend with the news that his family had agreed to their marriage. But fate had another surprise in store for them: a stark reminder of the fact that they live in Pakistan, where love costs a thing or two.

On the way back from dinner, Ahmed took a detour and stopped his car on the service road. The couple shared a kiss. “It was nothing more than that,” says Manahil. “But before we knew it, two uniformed law enforcers on a bike came out of nowhere and one put his pistol on the window,” she recalls.

Ahmed opened the door and stepped out of the car, only to be hit by the personnel on his head. “They took my partner away and took away our mobile phones and wallets,” she says.

The policemen continued to harass the young couple for almost 20 minutes. They threatened them with jail time and said they would only be released if their parents came to the police station. “I started crying. They even called me a slut,” Manahil recounts. “They took Ahmed to the nearest ATM and let us go only after taking a total Rs17,000 from us.”

Manahil and Ahmed are not the only couple to fall victim to the police’s high-handedness. Of late, numerous couples have shared their experiences with Cutacut, recalling how they were shamed, threatened and at times physically harmed when they were found with their partners by policemen.

“The police cannot stop couples when they are together even if they are getting intimate” – DIG South Azad Khan

So the question arises: does the law provide our police with the authority to stop couples on a date?

When we talked to lawyer and rights activist Abira Ashfaq, who works at Qaaf se Qanoon, a non-for-protfit legal initiative, she said: “The police can file an FIR for attempted zina (adultery) and only then arrest the accused.” But after an amendment made in Criminal Procedure Code (CrPC), it has become mandatory that if the suspect is a woman, action against her can only be taken by a superintendent of police and with permission from a magistrate.

In an interview with Cutacut, Karachi’s DIG South Azad Khan said, “Let me be straightforward, there are only a few policemen doing this just to extort money from young men and women. There is no law which the police can use to stop couples when they are driving or are found in public places while dating.”

He further said that there is, however, a section in Pakistan Penal Code which prohibits people from doing obscene acts causing nuisance to general public.

Section 294 of the PPC states: “Whoever, to the annoyance of others; a) does any obscene act in any public place, or b) sings, recites or utters any obscene songs, ballad or words, in or near any public place, shall be punished with imprisonment of either description for a term which may extend to three months, or with fine, or with both”.

But who defines what “obscenity” and “public space” are?

“I’ll say it again, the police cannot stop couples when they are together. Even if they are getting intimate inside their car, they can’t accuse them because their private vehicle is not a public space,” says the DIG. “The law doesn’t permit us to do that. It very clear,” he added.

He even went on to assure that they are making a new SOP following which policemen cannot ask a man what relationship he has with a woman sitting with him in the car.

*Names have been changed to protect identities

You can view a video on the subject here:

Source: www.cutacut.com

Hans Hoppe's Bottom-Up Revolution simplified

2019-10-12T12:21:00.004-07:00

The defensive use of democracy: the use of democratic means for non-democratic, libertarian pro-private property ends.

Even if it is impossible to win a majority for a decidedly anti-democratic platform on a nationwide scale, there appears to be no insurmountable difficulty in winning such a majority in sufficiently small districts, and for local or regional functions within the overall democratic government structure. In fact, there seems to be nothing unrealistic in assuming that such majorities exist at thousands of locations. That is, locations dispersed all over the country but not evenly dispersed. ..... It is very well possible to assemble these isolated figures around an intellectual center, and give them unity and strength, and a national or even an international audience.

Everything else falls almost automatically from the ultimate goal, which must be kept permanently in mind, in all of one’s activities: the restoration from the bottom-up of private property and the right to property protection; the right to self-defense, to exclude or include, and to freedom of contract.

The first central plank of one’s platform should be: one must attempt to restrict the right to vote on local taxes, in particular on property taxes and regulations, to property and real estate owners. Only property owners must be permitted to vote, and their vote is not equal, but in accordance with the value of the equity owned, and the amount of taxes paid.

All public employees—teachers, judges, policemen—and all welfare recipients, must be excluded from voting on local taxes and local regulation matters. These people are being paid out of taxes and should have no say whatsoever how high these taxes are.

All local government assets must be privatized. An inventory of all public buildings, and on the local level that is not that much—schools, fire, police station, courthouses, roads, and so forth—and then property shares or stock should be distributed to the local private property owners in accordance with the total lifetime amount of taxes—property taxes—that these people have paid. These shares should be freely tradeable, sold and bought.

Consistently applied, no cooperation, no assistance whatsoever on any level, the central government’s power would be severely diminished or even evaporate.

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Polio vaccine: Is it really as safe as the Government claims it to be?

2019-09-04T14:58:00.002-07:00

By Karim Khan
Published: November 10, 2014

Is the Oral Polio Vaccine (OPV), which is administered to millions of children in the developing world, really safe?

Reporting on polio vaccination has secured a regular slot in major media outlets. The reporting is mostly always supportive of the vaccination campaign commonly called “polio eradication”. But is the Oral Polio Vaccine( OPV), or Sabin vaccine (named after Albert Sabin), which is administered to millions of children in the developing world, really safe? Does it have no harmful effect on human health a claimed by some doctor in a recent story?

The short answer is: no, it’s not completely safe. Not only can it cause permanent disability in some children, it actually has caused epidemics of paralysis in at least two countries – Nigeria and India. It’s been officially admitted and reported in media many a time, though the media in Pakistan tends not to talk about it or its history beyond the version endorsed by the authorities.

The most well-known (or infamous, for that matter) epidemic of the paralysis caused by the OPV happened in Nigeria in the period ranging July 2005 to June 2010. An outbreak of vaccine-derived poliovirus (VDPV) caused 315 reported cases of type 2 circulating vaccine-derived poliovirus (cVDPV2). The incident followed the use of OPV to immunise children in Nigeria where polio caused by wild poliovirus has remained endemic.

The Nigeria outbreak caused by the vaccine led Steven Wassilak of the Centers for Disease Control and Prevention (CDC) to write a research paper on such cases. His paper titled ‘Outbreak of Type 2 Vaccine-Derived Poliovirus in Nigeria: Emergence and Widespread Circulation in an Under-immunised Population’ was published in The Journal of Infectious Diseases (2011)’. The paper noted that vaccine-caused paralytic polio is clinically indistinguishable from that caused by the wild polioviruses.

In India, which was been declared free of polio in 2013, a notable rise in cases of vaccine-induced paralysis has been reported over the past three years. Acute Flaccid Paralysis (AFP) is one of the types of permanent paralysis, and is considered as a sign of acute or debilitating polio. The incidence of AFP reportedly soared in India over the period of 1996 to 2011 with 60,000 new cases reported in 2011. Various sources have placed the number of vaccine-associated AFP cases in India variedly, but hardly anyone reported less than 45,000 cases in 2012.

The risk of paralysis and serious harm associated with OPV was indeed the reason that led most of Europe, particularity Western Europe, as well as the United States to “discontinue” the use of OPV for immunisation. The word “discontinue” is of course a euphemism for “banned” so as to linguistically benefit the OPV which is the foundation of international health projects worth hundreds of millions of dollars a year. As reported in a 2004 paper published in the Journal of American Medical Association (JAMA), all cases of polio reported in the US since 1979 were cases of Vaccine-Associated Paralytic Poliomyelitis (VAPP). That is why the vaccination policy was changed to exclusive use of inactivated vaccine for polio, called Inactive Polio Vaccine (IPV) in short, which is administered as an injection, and is significantly more expensive than OPV.

Is it the ignorance regarding both the disease and the science of the medicine that worries critical thinkers? Yes, but more so it is the lack of freedom of questioning in a country that has effectively given itself to a form of slavery by so-called non-profit international organisations that earn millions from vaccination campaigns. The recent imposition of travel restrictions on Pakistanis as “recommended” by the World Health Organisation (WHO) are more than proof of such slavery.

Worse though is the one-sided media reporting that uses language as a tool to shape voice of dissent as “propaganda” by running headlines with terms like “anti-polio” campaigns when the questions raised are in fact directed at the safety of the vaccine claimed to be effective against polio. It’s true that oral polio vaccine’s risk of causing permanent disability is reported in only a handful of cases. Most children vaccinated with it don’t show any immediate adverse effects. However, the same holds for wild poliovirus. Less than one percent of wild poliovirus cases show any symptoms of the disease and of those permanent disability is still rare. The important question is: are parents made aware of the risks significantly early to let them make an informed decision on vaccinating their child?

Source: https://blogs.tribune.com.pk

What is Bitcoin?

2019-08-21T16:44:00.000-07:00

General Disclaimer: This is a guest post, and the website does not necessarily endorse all views presented in this article.

Imagine you have a watch. The primary purpose of your watch is to tell time. If the watch breaks, time doesn’t stop, it continues. Time continues no matter how many watches break. Time exists because space exists. Time is intangible, it cannot be physically held in your hands yet it exists. Similarly, Bitcoin exists on the internet. For as long as computers, internet or any form of peer to peer networks will exist, so will Bitcoin. Bitcoin is also intangible. You can possess it yet you cannot physically hold it. The word Bitcoin therefore is a bit ambiguous because no physical coin exists.

Whenever anything is used as a medium of exchange, it can be categorized as a currency. A currency gives people an ability or power to purchase and sell goods and services. For example, USD or PRs currency notes are an example of mediums of exchange. Bitcoin is also a medium of exchange because it is used for buying and selling goods and services. Bitcoin is strictly and completely a digital currency.

Although we never ask the questions about where the fiat currency of our country comes from but whenever conversation of Bitcoin comes up we want to know what it is. I wish that everyone asked these questions for all the currencies they use because mostly, their currency is printed out of thin air by the lousy Keynesian banking system of their country. It is further defaced with inflation and governments enjoy violent monopolies over it. I am going to give you reasons to abandon these currencies because I am about to prove it to you that Bitcoin is a much superior currency over any other fiat currency and only you have a complete control over the fruit of your labor as it should be.

To understand Bitcoin better, let us look at its structure. Bitcoin is a unique digital currency and payment system and it can be looked at through these major categories
• Currency
• Online ledger
• & Software

When someone says that Bitcoin is a digital currency, what they mean is that Bitcoins are just accounting entries in a distributed database software called Blockchain. In other words, unique alphanumeric data stored in a database makes up Bitcoins (in reality the record of Bitcoin). Blockchain is simply a ledger. Ledger is something where records of transactions are stored or recorded on a network of computers. Blockchain ledger is distributed or shared by all Bitcoin users and miners. Whenever any amount of Bitcoin including fraction of a Bitcoin is moved from one person to another person, the transaction is recorded on the ledger and it is there forever and it is also publically viewable. Even though it is public; the name of the person who sent it and the name of the person who received it is not public information. The identity of people using bitcoins is not stored in the ledger of the Blockchian.

Bitcoin currency is modeled after actual physical Gold. Bitcoin is decentralized and it is completely private. It is Decentralized and private because it cannot be controlled, created or destroyed by any government around the world. It is modeled after Gold because of its non-inflationary, inherent deface protection features. There will never be more than 21 million (2 karoor dus laakh) Bitcoins. Critics of Bitcoin sometimes ask how will 21 million coins be enough for 7 billion people? Among the few answers, the most important I like to state is the fact that Bitcoin can be divided in 100 million (dus karoor) pieces and anyone can own a 100 millionth of a Bitcoin (.00000001). As the demand and use of Bitcoin will increase, so will the purchasing power and value of Bitcoin compared to other currencies.

To clarify, Bitcoin is not a company or a factory that produces currency. It is a digitally distributed technology. For anyone including governments, to try to destroy Bitcoin, they would have to shut down the entire internet.

The record of how many Bitcoins you own is immediately stored in the software programs called Bitcoin digital wallets. A digital wallet is like a physical wallet, a purse, a pocketbook or a money safe with a lock, except it is digital in nature and it exists on your mobile phone or in a computer. You can never lose your Bitcoins as long as you have a cold storage or a backup phrase. You should lookup both cold storage and bitcoin backup phrase concepts on the internet. For those who own Bitcoins, any one of the two methods are absolutely essential for backing up your coins, just in case you happen to lose your mobile phone or computer. If you have cold storage or password phrase saved, you can easily access your coins again and get them back in your new computer or mobile phone.

Bitcoins transactions require internet on your phone or computer. Bitcoin transactions occur directly between the two parties involved (between two people) and no third party is needed. For example, for Bitcoin transactions, no banks, no governments, no special permissions, no time and place restrictions are required. Bitcoin can be used anytime, anywhere without any borders or restrictions on the amounts of money transferred.

Sending and receiving Bitcoins is as easy as sending SMS / MMS picture messages or email. One can buy and sell nearly anything using Bitcoins. Sending Bitcoins has very small transaction fees compared to credit card fees. These fees are essentially small awards shared with Bitcoin miners on blockchain. Miners are people with high end computers and great computing powers on the blockchain network to facilitate ledger transactions and confirmations. These computers are very expensive and require a lot of electricity to operate. Bitcoin transactions are therefore nearly instant.
This blockchain technology which is the core behind Bitcoin and other cryptocurrencies, can also be used for “Global Asset Register”. For example, a car key can be assigned to a specific person by recording it on a public ledger.

Any business can take advantage of Bitcoin technology and instantly start accepting payments in Bitcoins for their products and services. Setting up for Bitcoin is easy and free with services similar to ANYPAY or BITPAY. Bitcoin transactions are instant and there are no bank processing delays. Businesses can save a lot of money in transaction fees as well as tax liabilities.

How can one start with Bitcoin?

You will need a free app or a free software program on your mobile phone or computer to get started. As previously mentioned, these programs or apps are called “Bitcoin Wallet(s)”. There are many apps and programs available for free download over the internet. Please do your own research, download and use a secure wallet from a trusted source. Read online reviews before downloading a wallet. Read pros and cons and make an informed decision.

The next step is to get Bitcoins. You can either purchase Bitcoins with fiat money (currency of your choice), other digital crypto currencies, or you can mine Bitcoins. To get Bitcoins using a standard currency such as Us dollars or Pakistani Rupees, there are three easy ways.

1. One: You can buy Bitcoins via online Bitcoin Exchange, i.e COINBASE, URDUBIT or similar. It is advised that you should never leave your money on any exchange and transfer Bitcoins from exchange to your wallets on your phone or computer immediately after purchase. Please keep your devices (Phone or computer) password protected.

2. Two: You can buy Bitcoins using currency via a Bitcoin ATM (the automatic teller cash machines if any such device is available in your area. As of February 2019, it is unknown if any standard bank offers such service and it is unlikely anytime soon. This method to acquire Bitcoins is the most recommended option for privacy and tax evasion but the ATM fees are on average around 9% +/-, which is high. This may be the cost you have to pay for anonymity.

3. Three: You can get Bitcoins via website “Purse.io” by becoming an EARNER and by facilitating people who wish to purchase goods on Amazon.com using Bitcoins. They tell you what they want to buy, you buy it for them using your currency such as the US Dollar and they pay you in Bitcoins. This method will cost you almost nothing to get Bitcoins, just a little time. This option is better than using an Exchange. As of February 2019, I haven’t heard if governments have tracked this service and its users. There are no guarantees for the future.

Once you have Bitcoins, you can spend them anywhere Bitcoins are accepted for products and services. If someone doesn’t directly accept Bitcoins, you may purchase gift cards with Bitcoins or Bitcoin based credit cards offered by Bitpay to make purchases around the world in any store and online. There are ways to only deal with Bitcoins and no other currency altogether but this process involves a major learning curve, some sacrifices and life style changes but it’s not impossible.

There are some known problems with Bitcoin as you would often hear about them from the critics of Bitcoin. For example:

• Bitcoin is not perfect, not invincible and not anonymous. All these allegations are somewhat true.

• Because Bitcoin is still a new concept, its value is volatile. Historically Bitcoin has seen many fluctuations. This is generally expected in Bitcoin communities. Overall Bitcoin is the strongest currency in the world for its high value.

• Trusting a Bitcoin exchange can be a very costly mistake for example Mt.Gox and Quadrigacx exchange. The Quadrigacx owner allegedly died with secret keys and people loss their coins. Mt. Gox had a vulnerability. It was maliciously attacked and coins were stolen.

• 51% Attack. When malicious miner’s computing power increases more than 50% of the computing power of the entire blockchain, they can interrupt and compromise Bitcoin network. Mostly the damage is done to an exchange or a mining pool under attack. This is another reason not to ever store your Bitcoins on any online exchange.

• Bad people can use Bitcoins for bad things that break laws including drugs etc. Bad people have existed since the origin of men. Bad people do bad things with or without Bitcoins. Statists and Governments use these types of excuses to create bad laws and stop innovations especially when these innovations threaten their own existence, their revenue generation schemes and their control over people. Libertarians should just ignore this gang of thieves’ known as government.

The fact is, all libertarians should be using Bitcoins instead of state issued fiat monies. If Walmart, CSD or TCS was bombing children around the world, I wouldn’t shop there. Why should I then use money of the governments who do the same. Moreover, all people should be libertarians.

To get started and learn more about Bitcoin; visit weusecoins.com, Bitcoin.org (BTC bitcoin core), Bitcoin.com (BCH bitcoin cash), yes, there are differences between these two last ones, but that’s for another podcast.

Please support us by subscribing and sharing our podcast “Libertarian Gup Shup” at iTunes, Stitcher, Google play music, YouTube and libertariangupshup.com.

About the Author:
This article is written by M.I Chaudhary. He is the founder of Pakistan Libertarian Party

Higher taxes will increase cigarette consumption

2019-07-29T01:09:00.000-07:00

ISLAMABAD: The price differential between duty paid cigarettes and illicit products would considerably increase after imposition of Health Tax on cigarettes in the upcoming budget.

The taxation measures to be taken in coming budget on tobacco industry would have following repercussions: People will shift from legal brands of cigarettes to illicit due to increase in price difference between duty paid and non-duty paid cigarettes, major increase in smuggling due to higher prices of documented brands.

Violations of health laws and warnings by the illicit cigarettes manufacturers will continue to go unchecked by authorities giving them further edge over duty paid cigarettes. The component of local tax evasion on cigarettes is already very high and any move to impose Sin Tax would further encourage tax evasion at domestic stage. The proposed 'Sin Tax' on tobacco industry would result in production of local tax-evaded cigarettes and increase in tax evasion in tobacco sector.

The Ministry of National Health Services, Regulations and Coordination with the help of the FBR will have to take appropriate measures to check illicit cigarettes in Pakistan, reflecting serious violations of health laws/rules and regulations by the 'illicit' industry.

The alarming figures of consumption of illicit cigarettes on daily basis ~~cannot be ignored by the Health Ministry.~~ These illicit cigarettes mainly include non-duty paid cheap cigarettes whose sale is openly violating all kinds of rules and regulations of the Ministry of Health.

The situation would become worst after imposition of Health Tax and additional FED from July 1, 2019.

As per Oxford Economics Study, Pakistan ranks 1st in illicit trade of cigarettes in Asia, with a total volume of 326 billion illicit cigarettes consumed in 2017. The primary reason for existence of illicit manufactures is the tax-driven price differential between legal and illicit brands, which currently stands at 130%.

The documented tobacco industry is repeatedly urging the government to adopt a balanced fiscal approach with effective enforcement measures to curtail the sale of tax-evaded cigarettes, which would generate revenue over and above Rs 115 billion by the end of 2018-19.

The documented tobacco industry has estimated that the revenue collection is expected to cross Rs115 billion by the end of 2018-19 and will increase further if the government retains this excise structure.

The lowest tier should remain intact in coming budget to provide an opportunity to the local units to come into the tax net ~~and enforcement efforts need to be geared up to avoid losses.~~

The FBR has acknowledged the fact that two multinational cigarette manufacturing companies would contribute over Rs115 billion to the FBR by the end of 2018-19, reflecting contribution of record revenue from documented tobacco sector.

However, the most dangerous aspect in consumption of illicit cigarettes is the blatant violations of the health regulations by the local manufacturers of Non tax paid cigarettes as well as non-payment of applicable rates of Federal Excise Duty under FED slabs notified by the FBR.

Ministry of Health had proposed imposition of 'Sin Tax' on tobacco industry and beverages to generate additional revenue. At the same time, apparently there is no system in the Health Ministry to check or control or monitor the manufacturers, suppliers, sellers and impact on consumers of illicit production of cigarettes. Moreover, in the absence of authentic data on illicit trade consumption of cheap cigarettes in the country, this huge consumption has not only destroyed the documented industry but also serious health problems for those consuming illicit cigarettes in Pakistan.

Health tax is another form of excise tax which will again increase prices of legitimate brands but have no effect on the 33 percent illicit market that will continue to sell even below the minimum price in the country. ~~Therefore, the enforcement against this black market is necessary and coordination amongst various departments is necessary to take inputs and industry on board.~~

Furthermore these illicit cigarettes violate other health laws such as advertising, targeting youth, giving gifts, incentives and lucky draws, all of which are prohibited under the health ministry laws.

Currently in Pakistan, tax increases are counterproductive in achieving the government's revenue and health objectives since they are encouraging people to smoke cheaper cigarettes that are more affordable. This results in attracting the youth to initiate smoking due to cheap prices as 1 cigarette is available for Rs1.

The experts have apprehended that the massive raise in taxes on tobacco would immediately result in increase in smuggling and business of non-duty paid cigarettes in 2019-20. Without realizing the fact that over-burdening any sector with additional taxation would be a disaster for that sector, the government is mulling to impose Health Tax and additional FED on tobacco and beverages.

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This article appeared in https://www.thenews.com.pk on June 5, 2019.

'Government go-slow', as Pakistan's anti-corruption drive bites

2019-07-05T12:27:00.003-07:00

ISLAMABAD (Reuters) - An anti-graft crusade promoted by Pakistani Prime Minister Imran Khan has led to swathes of arrests of politicians, but critics say the economy is suffering as vital projects are put on hold by officials fearful of being caught up in the dragnet.

Khan won power last year vowing to root out corruption among what he cast as a venal political elite and views the probes into veteran politicians - including jailed former premier Nawaz Sharif and ex-President Asif Ali Zardari - as long overdue.

While few dispute the need to clean up Pakistani politics, the National Accountability Bureau (NAB) campaign has become a topic of fierce political debate.

Some in the business community say they worry the drive is hurting an ailing economy, which has just received a $6 billion International Monetary Fund bailout.

And the focus of the NAB so far on the new government’s political foes has prompted accusations it is a one-sided purge backed by Pakistan’s powerful military, which is seen to favor Khan. The government denies targeting political opponents.

NAB did not respond to a request for comment. The military also did not respond, but in the past it has denied interfering in politics or influencing NAB, an independent body within Pakistan’s legal system with its own investigators and courts.

The crackdown has also ensnared civil servants, who say they have become collateral damage in the accountability drive.

Six high-ranking officials who spoke to Reuters painted a picture of a civil service in disarray and decision-making at a standstill, with senior officials avoiding signing off projects or making decisions that could open them to bribery accusations.

“If a project works out, I don’t get a gold medal,” said one senior federal official. “But if it doesn’t work out, I might go to jail.” A second official spoke of an administrative “go-slow” amid a climate of fear in the bureaucracy.

POLITICAL CASES?

The government rejects accusations that NAB is impacting the economy, calling such allegations opposition propaganda, and says graft is to blame for Pakistan’s current economic woes.

Khan last month launched a commission to investigate projects and agreements that helped increase overall debt between 2008-2018, staffing it with members of NAB and military intelligence agencies.

Science Minister Fawad Chaudhry said government officials make up a small number of NAB cases, but their concerns had reached Khan and a special cell had been created within NAB to deal with bureaucrats’ issues.

“The rise of Imran Khan is basically a middle class revolution against corruption,” Chaudhry added. “You can’t expect from us that we will take the issue of corruption lightly.”

NAB last month arrested former President Zardari and his sister over alleged false bank accounts and money laundering. They both deny wrongdoing and call the arrests politically motivated.

Since Khan assumed power last August, NAB has continued investigating jailed former Prime Minister Sharif, who has alleged the military’s hidden hand is behind many of the anti-corruption cases against his family.

Fresh probes have also been opened involving Sharif’s brother and many of his closest allies, including at least eight ministers from the previous government. They all deny wrongdoing and say they are victims of persecution.

“Everybody who is against this government has a NAB case,” said one opposition politician who was a minister in the previous government.

Inquiries have also been launched against some prominent businessmen.

“KILLS CONFIDENCE”

Pakistan’s new liquefied natural gas (LNG) infrastructure, erected at breakneck speed by the previous administration, has emerged as a major anti-corruption battlefield.

LNG terminals built in 2016 and 2017 were vital to ending a decade of electricity shortages and turned Pakistan into one the world’s hottest LNG markets, with Qatar and Italy’s Eni signing long-term gas deals worth billions.

But Khan’s Pakistan Tehreek-i-Insaf (PTI) party has for years alleged corruption. In April, on NAB’s instructions, the government barred former Prime Minister Shahid Khaqan Abbasi, ex-Finance Minister Miftah Ismail, and six bureaucrats involved in the Qatar deal for the first terminal from leaving the country. They all deny wrongdoing. No allegations of wrongdoing have been made against the Qatari side.

Abbasi, who as petroleum minister masterminded Pakistan’s embrace of LNG, said he had to take a lead role because many officials were afraid of multi-billion dollar projects.

“Nobody wanted to do anything as they were scared of NAB,” said Abbasi, who said bureaucrats were now paying a price despite helping end electricity shortages. “We had good people who stuck their neck out and they’re all suffering today.”

A third LNG terminal and a new gas pipeline needed to keep up with rising energy demand have been on the “backburner” for more than a year as no decision making is taking place across ministries, according to an energy official.

“Bureaucrats being barred from leaving the country kills confidence,” he said. “We are going to have a (energy) crisis in a year or two.”

The result, say the officials who spoke to Reuters, is that senior colleagues nearing retirement are refusing to sign off on projects due to fears of being dragged out of retirement to answer NAB inquiries for years.

“If I have to make a decision about a $10 billion refinery... I’ll sit on this file for six months, and get the next guy to make that decision,” said the first senior federal official.

A senior civil servant in the Khyber Pakhtunkhwa province said he hasn’t approved any major project since late 2018.

“All bureaucrats know that once you are tagged with NAB, no matter if you’re innocent or you really did some corruption, you have no future,” he said. “You’re finished.”

Reporting by Drazen Jorgic; Additional reporting by Asif Shahzad; Editing by Alex Richardson

Source: https://www.reuters.com

What Must Be Done? - Hans-Hermann Hoppe

2019-02-02T12:31:00.000-08:00

How should anarcho-capitalists engage the modern state? Hans-Hermann Hoppe dissects the nature of the modern democratic state and suggests strategies for enacting a bottom-up libertarian revolution in ideology and civil government.

Hoppe begins by examining the nature of the state as “a monopolist of defense and the provision and enforcement of law and order.” Like all state-mandated monopolies, the monopoly of law enforcement also leads to higher prices and lower quality of services. Why is this state of affairs tolerated? The modern democratic states, much more than the monarchies and princely estates of old, are seen as moral and necessary despite ample evidence to the contrary.

In the minds of most modern citizens of democratic states, law and order is what the state says it is, and this has led to a long period of centralization and power consolidation by those states.

How can the libertarian fight back against this trend? Hoppe offers a program that can pave the way for a new libertarian society.

Audio | HTML | E-book | PDF

Why Pakistan needs a ‘Private Army’?

2019-01-28T09:18:00.001-08:00

The services of private contractors are used around the world. P. W. Singer, author of Corporate Warriors: The Rise of the Privatized Military Industry says, “In geographic terms, it operates in over 50 different countries. It’s operated in every single continent but Antarctica.” According to stats, in the 1990s there used to be 50 military personnel for every 1 contractor, and now the strength ratio is 10 to 1.

...... These private military company (PMCs) will actually serve as alternative forms of power application abroad through irregular means, without violating international law, without causing troubles in the domestic or public policy, or too many international repercussions.

According to the US State Department, thousands of private military contractors served and are serving in Iraq and Afghanistan. In Iraq, these contractors mostly provide security to high profile personalities or protect sensitive installations such as oil refineries. In Afghanistan, these contractors are quickly replacing US military and are engaged in training the Afghan National Army and police. These contractors are also expected to take a lead role in anti-Taliban/ISIS operations in the war-torn country after the withdrawal of US forces. This has raised fears of increased war crimes since International Humanitarian Law consider private contractors as unlawful combatants since they generally do not respect laws of war and do not carry any military insignia which may help identify their allegiances.

......

We need them

Pakistan has a standing army of almost 560,000 soldiers and officers in addition to almost a 100,000 reserves. The army is stationed across the length and breadth of the country and is involved in counterinsurgency and counterterrorism operations. The army is often called to assist civilian administrations especially during natural calamities or to curb civil unrest.

......

"However, unfortunately, Pakistan’s economic growth has stagnated and declined over the past decade. This has made it practically impossible for the military to be rearmed with the state of the art weaponry which has resulted in a conventional disadvantage viz-a-viz its arch-rival. Pakistan’s deterrence capabilities are enough to neutralize any threat from the east but the emerging hybrid threats within the country has overstretched the army.

For example, the army had to raise an entire new division to protect CPEC from asymmetrical threats in Baluchistan and Gilgit-Baltistan. The army was also tasked with training the police and paramilitary forces and providing backup to them whenever necessary. This strained the military’s resources. But it has a pragmatic solution. Private Military Companies.

Many soldiers and officers retire from the army at a young age. These men are forced to move to the private sector which neither suits them nor are they trained for it. By establishing such companies (the current private companies are sub-standard) having international standards, Pakistan can not only provide job opportunities to thousands of men but also relieve pressure on the over-stretched security apparatus of the country.

These trained men can be employed to protect vital infrastructure, trade routes, high profile personalities, train law enforcement agencies in addition to being a strategic reserve in case of a major war. " ......

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Excerpted from an article written by Zeeshan Munir at https://www.globalvillagespace.com/

Sugar shortages: Why price controls don't work

2019-01-28T07:57:00.000-08:00

Originally published as 'Will price controls on sugar work?' on dawn.com on September 07, 2009.

The Lahore High Court ordered the Punjab government Thursday to keep retail sugar price at Rs40 a kilo — Rs7 less than its current level — across the province.

It also directed the government to procure the sweetener from mills at Rs36 a kilo instead of Rs45, the ex-factory price fixed by the federal government for the entire country less than a couple of weeks ago, to ensure that its retail price did not exceed in Punjab beyond the court-fixed level.

The millers refused to accept the order because it meant a loss of Rs9 a kilo to them. They intend to appeal. Stockists and dealers too got worried because they had purchased the product at the federally fixed rate and stood to suffer huge financial losses if the court order was implemented.

The Punjab government pledged to implement the order and deployed on Friday revenue and police officials at the mills to seize stocks and prevent the millers from removing the same. But its food minister told a TV channel that it would take a couple of days to enforce the court order. He seems to be buying some time for the dealers and retailers to exhaust their existing stocks before the court-fixed rate is enforced.

But sugar had already begun disappearing from the retail markets at many places in Punjab by that time as retailers did not want to risk arrests and penalties on charges of flouting the court orders.

In less than two weeks the consumers were once again facing shortages and running from one place to another to purchase the sweetener for their use during Ramazan and on eidul fitr.

Sugar has been at the centre stage of what millers call as politics for almost a month. Initially it was the federal government that asked provinces to take action against stockists and mills for allegedly hoarding the product to make windfall in view of its rising global prices due to worldwide shortages.

The government soon realised its folly as administrative actions caused the sweetener to disappear from the market. After talks with the government,the millers agreed to lower their maximum prices to up to Rs49.50 a kilo inclusive of sales tax. The federal government thought it to be good bargain as imported sugar would cost consumers around Rs65 a kilo.

In the meanwhile, the Punjab government continued its crackdown against the mills to force them reduce their price to Rs45. The millers refused to oblige and the provincial government deployed its officials at their warehouses and seized their stocks. The matter was resolved after the prime minister waived 50 per cent sales tax on sugar and re-fixed the millers' price at Rs45.

The market was functioning quite smoothly and the product was available for Rs47 s kilo in spite of reports that some millers were delaying the release of their stocks when the court decision came in to topple the market upside down once more.

Price controls have always been very popular with governments worldwide including Pakistan because of their mass appeal. The possibility of political fallout of higher prices makes governments to frequently institute controls to regulate prices, particularly in times of soaring price inflation and shortages.

Before 1990s when Pakistan began to pursue free market policies, governments usually tried to control the general level of prices, regulating the prices of a whole range of commodities and products. But the trend changed after the country embarked upon the path of economic deregulation and liberalisation with successive governments selectively imposing price control on specific food and drug items.

Some times producers and suppliers are forced to lower their maximum prices to certain level called price ceiling. On other occasions, governments intervene in the market through state agencies like the Trading Corporation of Pakistan to remove the supply and demand imbalances for keeping prices down, though at a heavy cost. In a few cases governments subsidise the producers' cost of production to prevent prices from rising above the “desired” levels, although not all consumers consider the official determination of that price level as fair to them.

Price controls are meant to prevent prices from exceeding a certain maximum level. The idea is always to protect the segments of population that cannot meet price increases.

But do they work and produce the intended results?

“Price controls never work,” insists Shahid Kardar, a leading economic expert. “It is a supply and demand issue. Do you think that a shopkeeper will sell you a product for Rs10 if another customer is ready to pay Rs12 for it?” he asks.

Experts argue that price controls fail to protect most consumers. At the same time, these hurt others.

The negative implications -- temporary and long-term, direct and indirect -- of institution of price controls far exceed its benefits to the consumers, contends an economist.

“The artificial pricing mechanism never succeeds. It always results in shortages due to sudden increase in demand owing to panic buying as we recently saw in case of sugar and wheat flour in Punjab,” he says.

Official controls also discourage production of quality goods and encourage cuts in output. “Price controls offer incentives for hoarding, blackmarketing, production cuts, etc, forcing many consumers to pay for a product or an item a lot more than what they would have to pay if price controls were not in place,” he argues.

The official controls on drugs have invariably resulted in disappearance of cheap life-saving medicines from the market. The list of negative ramifications of price controls is long.

“It encourages smuggling if the global prices are higher than domestic prices of a product and if your borders are porous,” says a Karachi-based analyst. Price controls could not work effectively ~~in countries like Pakistan unless governments have proper tools to enforce them -- like sealing the borders, he says~~.

Take the example of wheat which crossed borders into Afghanistan in huge quantities when the government tried to keep down the prices lower than the commodity's global prices a couple of years ago.

“That forced the government to import wheat -- in spite of a good domestic crop which was initially surplus to our consumption requirements -- at a much higher price to cover the shortages created by smuggling,” the analyst says.

More importantly, the prices rise more rapidly once the controls are lifted, triggering high price inflation. “As soon as the official controls are removed the hidden inflation surfaces suddenly. The rapid inflation is always bad for the economy as well as consumers, whom the official price controls intend to protect, than a slower and steady rise in prices,” the economist argues. In addition to the economic costs of price controls, there is also an administrative cost to such an action. We have recently seen almost the entire bureaucracy in Punjab involved in the management of 'sasta' atta (cheap wheat flour) in the province. Yet the administration was unable to ward off long queues of consumers scrambling to purchase an extra bag of cheap atta. Shortages, albeit temporary, also emerged in the normal supply chain and people who did not want to avail of the opportunity to purchase subsidised flour were forced to pay extra amount to get it or do without it for days.

Economic experts, however, acknowledge that price controls do provide some kind of relief, though only temporarily, to the poorer people battered by soaring prices.

“But the economic and administrative cost of this short-term measure is so high that prudent governments would not tread this path,” the analyst says.

~~The best way to help the poorest of the poor is to directly support their incomes through targeted cash subsidy, argues Kardar.~~

~~“It should be left for the recipients of the cash to decide what do they want to do with it. They should be able to decide whether they want to buy flour or sugar or something else,” he contends.~~

Women lawmakers suggest ‘sterilization of men’ - Karachi

2019-01-24T13:22:00.000-08:00

KARACHI: The women lawmakers in Sindh Assembly demanded “sterilization of men” as a measure to control growing population of the country. During the debate on a resolution “to control population and launch of awareness campaign,” all political parties except lawmakers from religious parties, MMA and TLP, supported the resolution in the provincial assembly.

Rana Ansar

Muttahida Qaumi Movement – Pakistan MPA Rana Ansar moved a private resolution and said, “There is no proper planning in controlling population in the province. We lack resources and attach great importance in giving birth to more children. It’s a population bomb and we need to devise a comprehensive strategy to deal with it.”

Referring to the significant chunk of population living under poverty line, she said that all countries including China, Iran and Russia were making all-out efforts to control and plan their population, but here people consider women to be a machine to produce more children. “We should include this issue in our syllabus and start mass mobilisation in every nook and cranny of Sindh. Not only women, but male health workers should be appointed to sensitise men,” she said.

Nusrat Seher Abbasi

Nusrat Seher Abbasi of Grand Democratic Alliance (GDA) supported the resolution and said that women had suffered more in every field, so it’s high time for men to render sacrifices. “Even in family planning, only women are being sterilised to prevent pregnancy. This causes serious complication to the mother’s health. Why are women being made the scapegoat and forced to give sacrifice of their lives? There should be a strict law which ensures male sterilization,” she said. The women sitting on treasury and opposition benches welcomed the idea by Abbasi.

Shehla Raza

Minister for women development, Shehla Raza, however, stood up at her seat and congratulated Rana Ansar for moving the resolution. “Women are also human and we should care and protect them. When women give birth to more babies, there is greater risk of mothers dying and giving birth to weak and abnormal children,” she said adding, “It is not possible for a poor man to feed a dozen children and provide education and other facilities. We can only compete in the world when you have mentally and physically healthy people in society.”

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Source: https://tribune.com.pk

Ex-PM Shaukat Aziz: Government and Bussiness should not mix

2019-01-24T06:14:00.000-08:00

Former Prime Minister of Pakistan, Shaukat Aziz is known as one of the rare politicians to not mix ‘Government and business’ together. During his leadership, Mr. Aziz oversaw the successful privatization plan of Pakistan’s state assets. He led Pakistan when it was in near financial ruin but managed to steer the country towards unprecedented economic growth. He shares his views on the success of Pakistan during his tenure as Prime Minister from 2004 to 2007 with Interview of the Day host, Bilqis Bahari.

Read the full interview here.

"When I came into Government, there was no privatization. There were some – one or two but not in a massive way. I strongly felt that it is not the business of Government to be in business. ~~Government should be the enabler~~. ~~Government should~~ prepare the ecosystem for the economy to grow. ~~Government should~~ introduce structural reforms to improve and enhance and develop its operating ability of the economy. But they don’t have to manufacture everything. They don’t have to control every market. Let the market forces work. ~~They should be having supervision. They should be having their eye on the ball so that things are under control~~. Any country which has done structural reforms of the economy in a good way has got the dividend from it. Pakistan is an example. We had for example all the banks in the state sector. We sold every bank except one. One we kept, which we listed. Even if you are not selling, although I prefer everything being sold ~~and then you have a strong regulator whose watching it, but you can have one bank in the public sector, one or two~~. But they too, list them in the stock market. ~~50% can be Government, 50%~~ can be private enterprise. The corporate culture must come ~~into the public sector enterprises.~~ The privatization has to be transparent. There should be no restriction. The asset still remains your asset. Your country’s asset. Even if foreigners own it, it doesn’t take away your control. Banking is a very controlled sector. The Central Bank is always looking at them no matter who owns the bank. So we shouldn’t worry. We got independent financial advisors and banks to handle the transaction. No control auctions, public. All the main auctions, we showed live on TV to the whole country. For example, I sold our state telephone company. Again, public open bidding. So I said let’s all this on the TV and everybody has to be prequalified before their bid. Why? Because you’re giving a major state asset to a private party. Local or foreign, we didn’t differentiate. And they have to be prequalified, prejudged by independent advisors. It has to be transparent. That being the case, we got the whole nation watching the sale of the telephone company. There were a lot of criticisms before it happened. When you privatized, ~~you must have an independent regulatory authority overseeing that activity~~. We created Pakistan Telecommunications Authority, which was a Government entity, which was overseeing the industry, not operating the company. And then we opened it to private sector, more competition to it. So now we have five or six mobile providers and the connectivity, the increase in subscribers went through the roof because we introduce mobile phones. Private sector came in. They put in new exchanges, new numbers, competition, special packages. It’s a totally different environment. More jobs created for the people. We had one phone company, Pakistan Telecom. Now we have 10 and its been in hindsight a very good experience. But it has to be transparent, the sale of the assets. That’s why we got in the end no criticism. Even the unions were quiet.

...... our telephone auction was on TV. Everybody then said ‘oh, we saw it. It was okay, you know,’ rather than rumors starting and all that. I think there is a way. Each country is different. I’m not saying what we did is the best way to do. There are maybe better ways. But I am a great believer in the value of privatization and I’m a great believer in opening it up. There’s no difference between local and foreign. That is also a myth. Nobody can put a telephone exchange in his briefcase and take it away to a foreign country. You know, it’s a system. It can’t leave. It has to be in the country to be operated. All these taboos will have to be broken and then you do what is in the best interest of the country. This is the way to go in my humble opinion.

What’s Really Keeping Pakistan’s Children Out of School?

2019-01-23T14:12:00.000-08:00

The demand for education is already high. Pakistan’s education crisis is a supply-side problem created by Government regulation.

"Less than half of third graders in Pakistan can read a sentence in Urdu or local languages. Thirty-one percent can write a sentence using the word “school” in Urdu, and 11 percent can do it in English.

Children in government schools report that teachers have them clean, cook, massage their feet and buy them desserts. Children are categorized as smart or stupid as soon as they start school. Corporal punishment is severe. Parents will send their kids to a private school if they can afford a few dollars a month, but they do not see government schools as worth it.

Since 2010, Pakistan has more than doubled what it budgets for education, from $3.5 billion to $8.6 billion a year. The budget for education now rivals the official $8.7 billion military budget. The teaching force is as big as the armed forces.

But Pakistan has a learning crisis that afflicts its schoolchildren despite much debate and increase in funding for education because policy interventions by the government and foreign donors misdiagnosed what is keeping children out of school.

Although aid programs of the United States and Britain contribute a mere 2 percent of the education budget, those countries and the local elite, whose own children go to high-end private schools, have emphasized that Pakistanis demand education and that more children should be enrolled in school.

But the demand for education is already high, evidenced by the mushrooming of low-cost private schools that now enroll 40 percent of students in the country and charge as little as $2 a month."

Pakistan’s education crisis is a supply-side problem. Enrollment rates are used as the measure for progress because Pakistan has the second-largest population of out-of-school children in the world. But the proportion of 5- to 9-year-olds in school is the same as it was in 2010: 57 percent. With teachers chronically absent from school at a rate of 20 to 30 percent and most of the education budget going into their above-market salaries ($150 to $1,000 a month), doubling the budget was never the solution to Pakistan’s education crisis.

"The problem is that donors have created too much noise. Convinced by their own solutions and backed by foreign expertise and international consensus, foreign donors have run high-profile advocacy campaigns and monopolized the attention of bureaucrats, party leaders and the version of civil society that Pakistan has developed in response to them."

"But to turn schools into places that provide education will require a local constituency asking the right questions. The hottest issue regarding education in Pakistan right now is limiting the fees that high-end private schools charge. If elites mobilized as effectively around issues that affect the majority of Pakistanis, we would see faster and more meaningful change."

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Excerpted from: https://www.nytimes.com/2017/10/18/opinion/pakistan-education-schools.html

(Emphasis added)

Why Libertarians Fail at Politics

2019-01-23T12:45:00.003-08:00

Jerry Taylor of the Niskanen Center dropped a truth bomb on the beltway in his ~~recent~~ piece for Fox News about the decline of Rand Paul. Taylor notes that the alleged growth of the libertarian movement in the wake of the Ron Paul campaign was largely illusory. The alienated populists and conspiracy theorists that filled out Paul’s numbers in 2012 easily made the transition to the very un-libertarian Donald Trump in 2015, leaving Rand out in the cold.

The lack of a broad-based movement, despite a number of high profile campaigns and events, is a bitter pill for libertarians who believe in electoral politics. Having libertarians in office may help raise the profile of issues like overcriminalization, tech freedom, and the insanity of the drug war. But those who await a libertarian takeover of the GOP misunderstand the fundamentally radical nature of libertarian ideas and how deeply that radicalism conflicts with the perceptions most Americans have about the role of government.

Trump supporters are a grim reminder that millions of voters view the government as a hammer that can be wielded to smash opposing values or groups and force their beliefs on others. Educating the electorate about libertarian ideas misses the fact that they have no real incentive to learn; most don’t care about the relationship between man and state and likely never will, as long as the state continues to provide the stability they have come to expect. Ron Paul’s success in 2008 and 2012 can largely be credited to the mortgage crisis; once the sting faded, so did support for his radical ideas.

There’s a good reason libertarians remain at the ideological fringe: “Libertarian politics” is a contradiction in terms. Libertarianism is not a third party, like the Know-Nothings or the Whigs or a prescription of policy tweaks to make the government more efficient. It is a distinct value system that abhors political power itself, even if some of its adherents consider power a necessary evil.

Libertarians may disagree whether the state should be abolished or minimized, but the difference matters little to the average American: Both seem frighteningly outside his own experience. Even the most moderate libertarians will wax poetic about ending intellectual property or privatizing the welfare system. Moreover, virtually all voters are deeply invested in government services they have come to depend on, and libertarians have been unable to present hypothesized private-sector alternatives while the state forces dependence upon itself. Conceptually, libertarians are on a page that most people find bizarre.

Libertarianism is best understood as the latest in a long line of radical liberation ideologies, rooted in the principles of natural law and individualism, that have provided the intellectual basis for rebellion since the American Revolution. It is a reaction to the perpetual expansion of government power in the U.S. and its frequent abuses. But radicalism, by definition, is immoderate and cannot compromise its way to reforms. Rather than moving toward the “Overton window” of public opinion by moderating controversial views (as Rand Paul attempted), radicals must pull public opinion towards their own viewpoints. Rand’s straying from libertarian principles means that he likely has little unique appeal even for the tiny libertarian electorate his father created. David Boaz’s research shows that 70% of libertarian-leaning voters went with Mitt Romney over Gary Johnson in 2012, so we know even libertarians who believe in politics are willing to blunt their own sword.

If libertarianism is denied its radical characteristics, it degrades into a flimsy millennial conservatism: Fiscally conservative, socially liberal and completely powerless, a mashup of existing ideas better espoused by other parties and ideologies. Without unyielding commitment to truly radical ideas, libertarians are drowned out by louder voices catering to the will of angry, pitchfork-bearing constituents. They add little of value, and are likely to end up little more than a footnote in the history of conservatism.

To fail to understand this is to remain resigned to swim against the tide of American politics. As Friedrich Hayek pointed out: “Those who have concerned themselves exclusively with what seemed practicable in the existing state of opinion have constantly found that even this has rapidly become politically impossible as the result of changes in a public opinion which they have done nothing to guide.”

Instead, libertarians might be more useful as single-issue activists and innovators. While U.S. politicians fail to shrink government, individualists like Erik Voorhees, Cody Wilson, Peter Thiel and the pseudonymous Satoshi Nakamoto are using technology to forge a new path. Time will tell exactly where that leads. But Rand’s decline underlines the fact that libertarian ethics predicate disruption and revolution, not moderation and compromise. As such, it is unlikely to ever get big votes in American politics.

---
Jason Farrell | Twitter | Patreon
Source: https://c4ss.org/

Why don’t we pay taxes?

2019-01-23T05:27:00.000-08:00

WHAT’S the most depressing economic statistic that is churned out repetitively in Pakistan? It’s the number of taxpayers. Time and again, the government and donors embarrass us for doing our nation a huge disfavour. In his first address, Prime Minister Shahid Khaqan Abbasi lambasted Pakistanis for not paying taxes.

Yet these are just myths. The fact is, we are one of the most overtaxed nations in the world. Simple arithmetic will do. Let’s start with disproving the most widely quoted number: only 1.21 million citizens pay income tax, ie less than one per cent of the population. But statistics (like the State Bank of Pakistan annual report) suggest that there are more than 57.5m employed people in the country. Since they are employed, they must be earning something and incurring expenditures on goods and services.

There is no good or service in Pakistan that is tax-free. Therefore, around 58m people are paying income tax one way or the other since their expenditures obviously come from their income.

"It is crass anti-intellectualism to repeat this old, tired mantra."

The same number can dispel another myth, that less than 1pc of Pakistan’s population pays taxes. Since Pakistan’s population is about 200m, the implication is that at least 29pc of the population is paying taxes. This number goes up when one considers the working-age population (15-59 years of age). As per the Economic Survey 2016-17, 61.4pc of the population is of working age, meaning around 122m people. The 58m people constitute approximately 48pc of this number.

Around 140m mobile-phone users pay more than 20pc tax on the total amount of load. By end 2015, the number of registered vehicles in Pakistan had surpassed 17m (and was growing). They run on fossil fuels, which are subjected to multiple taxes. The rate of sales tax on different goods and services is one of the highest in the world. Add to these the plethora of surcharges and duties, and what we have is a mind-boggling list of extractive and regressive methods of cheating people out of their earnings.

All these taxes are obviously extracted out of the income of those who earn. It is crass anti-intellectualism, then, to repeat the same old, tired mantra of ‘Pakistanis don’t pay taxes’. From birth (all the expenses that parents bear before birth and at the time of birth) to death (burial places, in cities at least, are sold for a price), we are being excessively taxed. If the intangible taxes (negative spillover of poor governance like choked roads, polluted air and water, the absence of waste disposal, poor law and order, etc), are also brought into consideration, then the taxation burden quadruples.

Now that some mistaken taxation myths can safely be buried, we need to probe this issue further. Begin by asking two all-important questions: What exactly is our tax ‘problem’? And what kinds/forms of taxation policies do we need to implement? (Your answers need not be the same as mine.)

For policymakers, our ‘tax problem’ is that our revenues (around Rs3.8 trillion) are not enough to meet our expenditures (around Rs5tr). Wrong! Pakistan is not the only country where expenditures are more than revenues. Our issue stems from unproductive use of what’s at hand. If the expenditure is productive, then revenue shortages are not so debilitating since the expenditures generate increased revenue possibilities for the future.

Our ‘tax problem’, in short, is that we are poor at managing and judiciously using revenues. If we could productively use revenues half our revenues would not have been spent on paying interest on debt.

On to the second question, the answer to which would seem to be a rather settled issue in Pakistan. ~~Everybody agrees that we need ‘progressive’ taxation~~, which in simple English implies taxing the rich more to redistribute. If that were to happen, would Pakistan be transformed? A probable answer comes from South Africa, which has the most progressive tax system in the world.

Yet the South African economy suffers from high income inequality. The reason is the absence of growth and quality-enhancing inclusive institutions. ~~For example, like Pakistan, South Africa has a poor public education system, an institution that is critically important in stimulating economic growth and improving life quality in the long run~~. Other such institutions (such as research and development culture) are almost nonexistent in Pakistan.

So, no, progressive taxation is not going to automatically transform Pakistan into Disneyland. We need to have inclusive institutions and avenues through which tax expenditures can generate growth and an enhanced quality of life. In Pakistan’s case, these institutions are either missing or non-functional or in a sorry state. Thus, the mechanism for transforming tax expenditures into something meaningful is absent.

Not surprisingly, the growth of tax revenue from a mere Rs7.5 billion in 1972 to a colossal Rs3.8tr in 2017 has never proved enough for the ever-growing leviathan, which seeks even more without any clear plan for its productive use. What’s the guarantee that if tax revenues touch the required Rs5tr mark, unproductive expenditures would not gallop to Rs7tr?

Does all this imply that Pakistanis don’t indulge in evading taxes? No. A certain percentage of Pakistanis, just like any other country in the world, do evade taxes. But that’s not the issue, which is about why people do so. After all, the same people give out more than Rs400bn in charity every year. What gives? Obviously, those who contribute profusely towards charity believe that it will earn rewards (in the afterlife). The same expectation of reciprocity is absent in the case of paying taxes.

I will bring this article to a close ~~by addressing the respected prime minister. Dear sir,~~ instead of calling us tax thieves, you should have thanked the Pakistani nation for not having risen up and burned down the rent-seeking edifice that goes by the name of government. ~~Please understand that to realise more taxes, you need to build trust with the people. Once you earn their trust, the apple (taxes) will automatically fall into your lap.~~

---
Shahid Mehmood
The writer is an economist.
shahid.mohmand@gmail.com

Published in Dawn, September 18th, 2017
www.dawn.com

Pakistan must push trade, shun protectionism

2019-01-22T07:42:00.000-08:00

Let’s not shun imports; let’s shun protectionism, inefficiency and rent-seeking.

ISLAMABAD: In his talk with businessmen in Faisalabad last month, Adviser to Prime Minister on Commerce Abdul Razak Dawood outlined his vision for economic development in these words: “Industrialisation through import substitution coupled with export growth through diversification.”

To help achieve this vision, Dawood disclosed the intention of the government to announce a comprehensive industrial policy to shun the culture of importing everything and emphasised the need for “Made in Pakistan”. He also criticised the free trade agreements (FTAs) which Pakistan had signed with different countries by citing the rising trade deficit with China, Indonesia and Malaysia. The adviser also reminded his audience that all Asian tigers had relied on government’s support for “self-sufficiency”.

This vision emanates from an old yet common fallacy: mercantilism.

Before analysing Dawood’s statement, let me first explain a few basic points. Trade takes place between individuals and firms and not between countries. The so-called trade deficit is between two countries only notionally. Realistically, the trade deficit, or surplus, is an aggregate of trade transactions between firms in two countries. It is only a construct of macro-economics. Therefore, any discussion on the so-called trade direction should be driven by an analysis of firms.

Consider this example by my favourite professor, Christopher Lingle. In all likelihood, if you have bought any goods from Amazon, you would have paid from the money which you have earned elsewhere. However, it will be quite foolish to say that you are running a trade deficit with Amazon as you will probably never sell anything to Amazon. If it is foolish to worry about this fictional deficit between the two private parties, it is futile to worry about trade deficit between two countries. What should be discussed is the overall trade volume and its direction for a country with the world.

Let’s now think about import substitution. First of all, it is not new. Pakistan has followed this strategy since the 1960s. Import substitution entails local production to shun imports. Can we, for example, shun the import of car engines, fuel and phones and switch to producing car engines, refined fuel and mobile phones ourselves? Do we need to re-invent the wheel?

The government has continued to provide direct support for textiles in the form of concessionary loans, subsidies or tariffs. As a result of this protection, most of the textile firms have not been able to grow. On the other hand, the government has generally failed to fulfil their minimum demand – a reliable and competitive energy infrastructure.

---
Ali Salman
PRIME Institute

(Emphasis added)

Source: https://tribune.com.pk/story/1892970/2-pakistan-must-push-trade-shun-protectionism/

Where are the medicines?

2019-01-21T17:45:00.000-08:00

Shahid Mehmood explains the crisis in Pakistan’s pharmaceutical industry created by Government regulations

Let me ask you a simple question: how many times has it happened that you go to a chemist and ask for a medicine, and the reply you get is that it is not available? Chances are that you have experienced this quiet a few times. That’s because even ordinary, inexpensive, lifesaving medicines tend to disappear off the shelves. And this happens every year. In other words, Pakistan experiences persistent medicine shortages.

Now here’s the perplexing part: there are more than 700 drug production units all over Pakistan, and more than 70,000 drugs are officially registered for production. Of these, hardly 10,000 are being produced, and even these experience supply shortages. All this, in the end, endangers the lives of those who need medicines for survival. Let us examine the root causes behind this worrying situation.

Pakistan’s pharmaceutical industry was once a very vibrant industry. In the 1990s, more than 40 international pharmaceutical firms of repute (multinationals) were operating in Pakistan, producing not only quality medicine but also contributing towards setting standards and providing employment opportunities. These years also saw the tremendous growth of domestic pharma firms. A study by McKinsey concluded that Pakistan’s pharmaceutical industry could be a ‘sunshine’ industry, meaning that it had tremendous future potential. By now, all those predictions have bitten dust. There are only a handful of multinationals operating in Pakistan, while others have wound up their businesses and left for greener pastures. Domestic manufacturers are also facing difficulties in their operations.

"The main responsibility for this dismal state of affairs falls upon the government, especially the way it regulates the pharma industry"

The main responsibility for this dismal state of affairs falls upon the government, especially the way it regulates the pharma industry. Particularly damaging is its ‘price control’ fallacy, whereby producers are prevented from raising prices of medicines. For example, between 2001 and 2013, prices remained ‘frozen’ as no price increase was granted. In 2013, after finally realising how destructive this policy was, a decision was taken to grant price increases in line with Consumer Price Index. One such price increase was granted in the previous years, only to be taken back under directions of the prime minister, stating that ‘welfare’ of the masses will be reduced!

How ridiculous is this policy can be easily gauged by available statistics. Between 2001 and 2012, the productive base and quality of the pharma industry were dealt a severe blow as the prices remained frozen. As costs of production skyrocketed in this time, industry found it increasingly difficult to operate as its operating expenses (relative to its profits) kept increasing while its profits gradually vanished. Resultantly, production of quality medicines kept declining as top quality firms (mostly multinationals) took flight to other countries like Bangladesh. By the time the Health Ministry and the Drug Regulatory Authority of Pakistan (DRAP) realised how counterproductive and devastating this policy was, the damage had already been done and persistent medicine shortages became a regular feature. Attempts to assuage the industry through granting one-time price increases (which largely remain non-implemented) will unlikely be helpful in bringing back investors who’ve wrapped up their business from Pakistan.

The policy of not granting price increases is the major detriment that has resulted in a plethora of debilitating problems for the industry. Other regulations (both at federal and provincial level) are equally illogical and counterintuitive. Take, for example, the case of toll manufacturing. The global standard is to grant manufacturing licenses for at least two years. But DRAP issues license for only three months, thus hampering production and investment prospects. Similarly, the DRA Act of 1976 introduced a draconian tax (a jugga tax) in the form of extracting two percent of gross income from pharma firms in the name of conducting research and development. Since that time, this tax has been collected regularly, but the fact is that not a single R&D lab of the FDA or WHO level exists in Pakistan.

Where does the income from this jugga tax go? During my research on pharma sector, the government officials were honest enough to admit that almost zero percent of all this income since 1976 has been spent on R&D. But they were tight lipped about where this money goes. The provincial regulations can also stump logic and common sense. For example, a particular regulation requires medicine shops to have qualified pharmacists and refrigerators at their shops. The illogicality of this regulation can be gauged from the fact that Pakistan has one of the lowest percentages of qualified pharmacists (relative to its population). So where will so many pharmacists come from? Also, while asking shops to keep refrigerators, the fact that electricity supply is unstable and uncertain is conveniently set aside (load shedding is particularly nightmarish in the countryside). When there is little or no electricity, and persistent fluctuations in voltage is a norm, why does the government expect shops to keep fridges, which will also increase their cost of doing business?

Simply put, government regulations are squarely aimed at wrong outcomes. ~~Its main job should be~~ to ensure quality and consistent supply of medicines, eradicating counterfeit medicines and black market activities, and to facilitate business. Yet it has failed at all of these. If it is so worried about price increases, it should look towards bringing in more competition, a policy that is absent. The below par performance of the government is ably complemented by the media, whose appetite for sensationalism does little to help the cause of industry and medicine availability. Every time there is a slight increase in medicine prices, the media raises an unnecessary harangue, leading policymakers to take back price increases in ‘larger interest of masses’. For example, a price increase from Rs5 to Rs10 is by no means excessive. But the media presents this in percentages to curry sensationalism and ratings, decrying “100 percent rise in medicine prices.”

In terms of the pharmaceutical industry, the main problem is of an ethical nature. The collusion between medical practitioners and pharma firms is as prevalent in Pakistan as in other nations around the world. But its failings are minor compare to the failings of regulations, which explains the predicament of the industry and the persistent medicine shortages. What we see is an abject failure of imagination at the political and policymaking level in realising that pharma industry does not run on charitable principles, but on corporate interests just like any other business. Despite having commercial interests, top pharma firms in Pakistan are major contributors to national kitty (taxes) and run an impressive array of charitable work across Pakistan. Unfortunately, media never reports this. Also, the impressive net returns (profits) of some pharma firms leads people to believe that the industry is doing very well. Again, the profits are a function of increasing population, rising per capita incomes and spread of media, which means increased in demand for the same medicines. Quality or innovative medicines are still hard to find, and are easily available in the black market at exorbitant rates.

In short, medicine shortages primarily owe to government regulations. There is little incentive for the firms to keep the supply lines operational. Illogical regulations are complemented by a general attitude that fails to appreciate the fact that a price rise is nothing compared to saving lives, ~~which should the top priority of any government~~.

Source: https://www.thefridaytimes.com

Bara tribesmen to move court against tourist centre

2019-01-21T07:15:00.000-08:00

LANDI KOTAL: Elders of Shalobar tribe in Bara tehsil rejected the proposed creation of a tourist centre on Besai hilltop and announced that they would move the court if the plan was executed.

They also declared that they would consult elders of all sub-tribes in the area on the matter before deciding about the final course of action. The announcement was made during jirga here on Saturday.

During a visit to Besai hilltop on Jan 16, Khyber Pakhtunkhwa Governor Shah Farman had announced the establishment of a tourist centre at the hilltop and construction of a road to it overlooking Hayatabad Township and parts of Jamrud and Bara areas.

The elders warned that they would move the Peshawar High Court if the government tried to occupy their combined property by force to develop the proposed tourist centre.

They called for a dialogue between local elders and relevant officials on the matter saying promotion of such activities goes against tribal norms and traditions.

The elders said they won’t agree to the establishment of any such facility without consultation.

They demanded the revival of over 100 stone crushing units at the lap of Besai hill saying the closure of such machines has rendered hundreds of local residents unemployed.

Source: https://www.dawn.com

Hans-Hermann Hoppe discusses 'Democracy: The God That Failed'

2019-01-21T04:37:00.001-08:00

Han-Hermann Hoppe discusses his book, Democracy: The God That Failed:

Theory and History

On the most abstract level, I want to show how theory is indispensible in correctly interpreting history. History — the sequence of events unfolding in time — is “blind.” It reveals nothing about causes and effects. We may agree, for instance, that feudal Europe was poor, that monarchical Europe was wealthier, and that democratic Europe is wealthier still, or that nineteenth-century America with its low taxes and few regulations was poor, while contemporary America with its high taxes and many regulations is rich. Yet was Europe poor because of feudalism, and did it grow richer because of monarchy and democracy? Or did Europe grow richer in spite of monarchy and democracy? Or are these phenomena unrelated?

Likewise, is contemporary America wealthier because of higher taxes and more regulations or in spite of them? That is, would America be even more prosperous if taxes and regulations had remained at their nineteenth-century levels? Historians qua historians cannot answer such questions, and no amount of statistical data manipulation can change this fact. Every sequence of empirical events is compatible with any of a number of rival, mutually incompatible interpretations.

To make a decision regarding such incompatible interpretations, we need a theory. By theory I mean a proposition whose validity does not depend on further experience but can be established a priori. This is not to say that one can do without experience altogether in establishing a theoretical proposition. However, it is to say that even if experience is necessary, theoretical insights extend and transcend logically beyond a particular historical experience. Theoretical propositions are about necessary facts and relations and, by implication, about impossibilities. Experience may thus illustrate a theory. But historical experience can neither establish a theorem nor refute it.

The Austrian School

Economic and political theory, especially of the Austrian variety, is a treasure trove of such propositions. For instance, a larger quantity of a good is preferred to a smaller amount of the same good; production must precede consumption; what is consumed now cannot be consumed again in the future; prices fixed below market-clearing prices will lead to lasting shortages; without private property in production factors there can be no factor prices, and without factor prices cost-accounting is impossible; an increase in the supply of paper money cannot increase total social wealth but can only redistribute existing wealth; monopoly (the absence of free entry) leads to higher prices and lower product quality than competition; no thing or part of a thing can be owned exclusively by more than one party at a time; democracy (majority rule) and private property are incompatible.

Theory is no substitute for history, of course, yet without a firm grasp of theory serious errors in the interpretation of historical data are unavoidable. For instance, the outstanding historian Carroll Quigley claims that the invention of fractional reserve banking has been a major cause of the unprecedented expansion of wealth associated with the Industrial Revolution, and countless historians have associated the economic plight of Soviet-style socialism with the absence of democracy.

From a theoretical viewpoint, such interpretations must be rejected categorically. An increase in the paper money supply cannot lead to greater prosperity but only to wealth redistribution. The explosion of wealth during the Industrial Revolution took place despite fractional reserve banking. Similarly, the economic plight of socialism cannot be due to the absence of democracy. Instead, it is caused by the absence of private property in factors of production. “Received history” is full of such misinterpretations. Theory allows us to rule out certain historical reports as impossible and incompatible with the nature of things. By the same token, it allows us to uphold certain other things as historical possibilities, even if they have not yet been tried.

Revisionist History

More interestingly, armed with elementary economic and political theory, I present in my book a revisionist reconstruction of modern Western history: of the rise of absolute monarchical states out of state-less feudal orders, and the transformation, beginning with the French Revolution and essentially completed with the end of World War I, of the Western world from monarchical to democratic States, and the rise of the US to the rank of “universal empire.” Neo-conservative writers such as Francis Fukuyama have interpreted this development as civilizational progress, and they proclaim the “End of History” to have arrived with the triumph of Western — US — democracy and its globalization (making the world safe for democracy).

Myth One

My theoretical interpretation is entirely different. It involves the shattering of three historical myths. The first and most fundamental is the myth that the emergence of states out of a prior, non-statist order has caused subsequent economic and civilizational progress. In fact, theory dictates that any progress must have occurred in spite — not because — of the institution of a state.

A state is defined conventionally as an agency that exercises a compulsory territorial monopoly of ultimate decison-making (jurisdiction) and of taxation. By definition then, every state, regardless of its particular constitution, is economically and ethically deficient. Every monopolist is “bad” from the viewpoint of consumers. Monopoly is hereby understood as the absence of free entry into a particular line of production: only one agency, A, may produce X.

Any monopoly is “bad” for consumers because, shielded from potential new entrants into its line of production, the price for its product will be higher and the quality lower than with free entry. And a monopolist with ultimate decison-making powers is particularly bad. While other monopolists produce inferior goods, a monopolist judge, besides producing inferior goods, will produce bads, because he who is the ultimate judge in every case of conflict also has the last word in each conflict involving himself. Consequently, instead of preventing and resolving conflict, a monopolist of ultimate decision-making will cause and provoke conflict in order to settle it to his own advantage.

Not only would no one accept such a monopoly judge provision, but no one would ever agree to a provision that allowed this judge to determine the price to be paid for his “service” unilaterally. Predictably, such a monopolist would use up ever more resources (tax revenue) to produce fewer goods and perpetrate more bads. This is not a prescription for protection but for oppression and exploitation. The result of a state, then, is not peaceful cooperation and social order, but conflict, provocation, aggression, oppression, and impoverishment, i.e., de-civilization. This, above all, is what the history of states illustrates. It is first and foremost the history of countless millions of innocent state victims.

Myth Two

The second myth concerns the historic transition from absolute monarchies to democratic states. Not only do neoconservatives interpret this development as progress; there is near-universal agreement that democracy represents an advance over monarchy and is the cause of economic and moral progress. This interpretation is curious in light of the fact that democracy has been the fountainhead of every form of socialism: of (European) democratic socialism and (American) liberalism and neo-conservatism as well as of international (Soviet) socialism, (Italian) fascism, and national (Nazi) socialism. More importantly, however, theory contradicts this interpretation; whereas both monarchies and democracies are deficient as states, democracy is worse than monarchy.

Theoretically speaking, the transition from monarchy to democracy involves no more or less than a hereditary monopoly “owner” — the prince or king — being replaced by temporary and interchangeable — monopoly “caretakers” — presidents, prime ministers, and members of parliament. Both kings and presidents will produce bads, yet a king, because he “owns” the monopoly and may sell or bequeath it, will care about the repercussions of his actions on capital values. As the owner of the capital stock on “his” territory, the king will be comparatively future-oriented. In order to preserve or enhance the value of his property, he will exploit only moderately and calculatingly. In contrast, a temporary and interchangeable democratic caretaker does not own the country, but as long as he is in office he is permitted to use it to his advantage. He owns its current use but not its capital stock. This does not eliminate exploitation. Instead, it makes exploitation shortsighted (present-oriented) and uncalculated, i.e., carried out without regard for the value of the capital stock.

Nor is it an advantage of democracy that free entry into every state position exists (whereas under monarchy entry is restricted by the king’s discretion). To the contrary, only competition in the production of goods is a good thing. Competition in the production of bads is not good; in fact, it is sheer evil. Kings, coming into their position by virtue of birth, might be harmless dilettantes or decent men (and if they are “madmen,” they will be quickly restrained or if need be, killed, by close relatives concerned with the possessions of the dynasty). In sharp contrast, the selection of government rulers by means of popular elections makes it essentially impossible for a harmless or decent person to ever rise to the top. Presidents and prime ministers come into their position as a result of their efficiency as morally uninhibited demagogues. Hence, democracy virtually assures that only dangerous men will rise to the top of government.

In particular, democracy is seen as promoting an increase in the social rate of time preference (present-orientation) or the “infantilization” of society. It results in continually increased taxes, paper money and paper money inflation, an unending flood of legislation, and a steadily growing “public” debt. By the same token, democracy leads to lower savings, increased legal uncertainty, moral relativism, lawlessness, and crime. Further, democracy is a tool for wealth and income confiscation and redistribution. It involves the legislative “taking” of the property of some — the haves of something — and the “giving” of it to others — the have-nots of things. And since it is presumably something valuable that is being redistributed — of which the haves have too much and the have-nots too little — any such redistribution implies that the incentive to be of value or produce something valuable is systematically reduced. In other words, the proportion of not-so-good people and not-so-good personal traits, habits, and forms of conduct and appearance will increase, and life in society will become increasingly unpleasant.

Last but not least, democracy is described as resulting in a radical change in the conduct of war. Because they can externalize the costs of their own aggression onto others (via taxes), both kings and presidents will be more than ‘normally’ aggressive and warlike. However, a king’s motive for war is typically an ownership-inheritance dispute. The objective of his war is tangible and territorial: to gain control over some piece of real estate and its inhabitants. And to reach this objective it is in his interest to distinguish between combatants (his enemies and targets of attack) and non-combatants and their property (to be left out of the war and undamaged). Democracy has transformed the limited wars of kings into total wars. The motive for war has become ideological — democracy, liberty, civilization, humanity. The objectives are intangible and elusive: the ideological “conversion” of the losers preceded by their “unconditional” surrender (which, because one can never be certain about the sincerity of conversion, may require such means as the mass murder of civilians). And the distinction between combatants and non-combatants becomes fuzzy and ultimately disappears under democracy, and mass war involvement — the draft and popular war rallies — as well as “collateral damage” become part of war strategy.

Myth Three

Finally, the third myth shattered is the belief that there is no alternative to Western welfare-democracies a la US. Again, theory demonstrates otherwise. First, this belief is false because the modern welfare-state is not a “stable” economic system. It is bound to collapse under its own parasitic weight, much like Russian-style socialism imploded a decade ago. More importantly, however, an economically stable alternative to democracy exists. The term I propose for this alternative is “natural order.”

In a natural order every scarce resource, including all land, is owned privately, every enterprise is funded by voluntarily paying customers or private donors, and entry into every line of production, including that of property protection, conflict arbitration, and peacemaking, is free. A large part of my book concerns the explanation of the workings — the logic — of a natural order and the requirements for the transformation from democracy to a natural order.

Whereas states disarm their citizens so as to be able to rob them more surely (thereby rendering them more vulnerable also to criminal and terrorist attack), a natural order is characterized by an armed citizenry. This feature is furthered by insurance companies, which play a prominent role as providers of security and protection in a natural order. Insurers will encourage gun ownership by offering lower premiums to armed (and weapons-trained) clients. By their nature insurers are defensive agencies. Only “accidental” — not: self-inflicted, caused or provoked — damage is “insurable.” Aggressors and provocateurs will be denied insurance coverage and are thus weak. And because insurers must indemnify their clients in case of victimization, they must be concerned constantly about the prevention of criminal aggression, the recovery of misappropriated property, and the apprehension of those liable for the damage in question.

Furthermore, the relationship between insurer and client is contractual. The rules of the game are mutually accepted and fixed. An insurer cannot “legislate,” or unilaterally change the terms of the contract. In particular, if an insurer wants to attract a voluntarily paying clientele, it must provide for the foreseeable contingency of conflict in its contracts, not only between its own clients but especially with clients of other insurers. The only provision satisfactorily covering the latter contingency is for an insurer to bind itself contractually to independent third-party arbitration. However, not just any arbitration will do. The conflicting insurers must agree on the arbitrator or arbitration agency, and in order to be agreeable to insurers, an arbitrator must produce a product (of legal procedure and substantive judgment) that embodies the widest possible moral consensus among insurers and clients alike. Thus, contrary to statist conditions, a natural order is characterized by stable and predictable law and increased legal harmony.

Moreover, insurance companies promote the development of another “security feature.” States have not just disarmed their citizens by taking away their weapons, democratic states in particular have also done so in stripping their citizens of the right to exclusion and by promoting instead — through various non-discrimination, affirmative action, and multiculturalist policies — forced integration. In a natural order, the right to exclusion inherent in the very idea of private property is restored to private property owners.

Accordingly, to lower the production cost of security and improve its quality, a natural order is characterized by increased discrimination, segregation, spatial separation, uniculturalism (cultural homogeneity), exclusivity, and exclusion. In addition, whereas states have undermined intermediating social institutions (family households, churches, covenants, communities, and clubs) and the associated ranks and layers of authority so as to increase their own power vis-a-vis equal and isolated individuals, a natural order is distinctly un-egalitarian: “elitist,” “hierarchical,” “proprietarian,” “patriarchical,” and “authoritorian,” and its stability depends essentially on the existence of a self-conscious natural — voluntarily acknowledged — aristocracy.

Strategy

Finally, I discuss strategic matters and questions. How can a natural order arise out of democracy? I explain the role of ideas, intellectuals, elites, and public opinion in the legitimation and de-legitimation of state power. In particular, I discuss the role of secession — and the proliferation of independent political entities — as an important step toward the goal of natural order, and I explain how to properly privatize “socialized” and “public” property.

Democracy: The God That Failed
Hans-Hermann Hoppe

The book grew out of speeches I presented at various Mises Institute and CLS conferences during the 1990s. These conferences, organized by Lew Rockwell, Burt Blumert, and, until his death in 1995, Murray Rothbard, had the purpose of advancing libertarianism by locating and anchoring abstract libertarian theory historically, sociologically, and culturally and thereby creating what has become known in the meantime as paleo-libertarianism (in contrast to left-countercultural-libertarianism and cold-and-hot-war “new” and “neo”-conservatism). The Rothbard-Rockwell Report, the precusor to LRC, was the first and most immediate expression and reflection of this intellectual movement. Others included The Costs of War, Reassessing the Presidency, and The Irrepressible Rothbard. Democracy the God That Failed is my attempt to define and give expression to the paleo-libertarian movement.

Source: https://www.lewrockwell.com/2001/11/hans-hermann-hoppe/democracy-the-god-that-failed/

The Unlibertarian Legacy of Ronald Reagan

2019-01-18T08:30:00.000-08:00

On August 2, 1988, President Ronald Reagan announced that he had changed his mind about the pro-union plant-closing bill. He had vetoed it three months earlier, but now let it become law without his signature after intense pressure from presidential nominee George Bush and former Treasury Secretary James Baker, now Bush's campaign chairman. Reagan claimed that only this action would enable him to sign a Congressional trade bill almost unequaled in its anti-consumer protectionism.

Ronald Reagan's faithful followers claim he has used his skills as the Great Communicator to reverse the growth of Leviathan and inaugurate a new era of liberty and free markets. Reagan himself said, "It is time to check and reverse the growth of government."

Yet after nearly eight years of Reaganism, the clamor for more government intervention in the economy was so formidable that Reagan abandoned the free-market position and acquiesced in further crippling of the economy and our liberties. In fact, the number of free-market achievements by the administration are so few that they can be counted on one hand—with fingers left over.

Let's look at the record:

Spending

In 1980, Jimmy Caner's last year as president, the federal government spent a whopping 27.9% of "national income" (an obnoxious term for the private wealth produced by the American people). Reagan assaulted the free-spending Carter administration throughout his campaign in 1980. So how did the Reagan administration do? At the end of the first quarter of 1988, federal spending accounted for 28.7% of "national income."

Even Ford and Carter did a better job at cutting government. Their combined presidential terms account for an increase of 1.4%—compared with Reagan's 3%—in the government's take of "national income." And in nominal terms, there has been a 60% increase in government spending, thanks mainly to Reagan's requested budgets, which were only marginally smaller than the spending Congress voted.

The budget for the Department of Education, which candidate Reagan promised to abolish along with the Department of Energy, has more than doubled to $22.7 billion, Social Security spending has risen from $179 billion in 1981 to $269 billion in 1986. The price of farm programs went from $21.4 billion in 1981 to $51.4 billion in 1987, a 140% increase. And this doesn't count the recently signed $4 billion "drought-relief" measure. Medicare spending in 1981 was $43.5 billion; in 1987 it hit $80 billion. Federal entitlements cost $197.1 billion in 1981—and $477 billion in 1987.

Foreign aid has also risen, from $10 billion to $22 billion. Every year, Reagan asked for more foreign-aid money than the Congress was willing to spend. He also pushed through Congress an $8.4 billion increase in the U.S. "contribution" to the International Monetary Fund.

His budget cuts were actually cuts in projected spending, not absolute cuts in current spending levels. As Reagan put it, "We're not attempting to cut either spending or taxing levels below that which we presently have."

The result has been unprecedented government debt. Reagan has tripled the Gross Federal Debt, from $900 billion to $2.7 trillion. Ford and Carter in their combined terms could only double it. It took 31 years to accomplish the first postwar debt tripling, yet Reagan did it in eight.

Taxes

Before looking at taxation under Reagan, we must note that spending is the better indicator of the size of the government. If government cuts taxes, but not spending, it still gets the money from somewhere—either by borrowing or inflating. Either method robs the productive sector. Although spending is the better indicator, it is not complete, because it ignores other ways in which the government deprives producers of wealth. For instance, it conceals regulation and trade restricdons, which may require little government outlay.

If we look at government revenues as a percentage of "national income," we find little change from the Carter days, despite heralded "tax cuts." In 1980, revenues were 25.1% of "national income." In the first quarter of 1988 they were 24.7%.

Reagan came into office proposing to cut personal income and business taxes. The Economic Recovery Act was supposed to reduce revenues by $749 billion over five years. But this was quickly reversed with the Tax Equity and Fiscal Responsibility Act of 1982. TEFRA—the largest tax increase in American history—was designed to raise $214.1 billion over five years, and took back many of the business tax savings enacted the year before. It also imposed withholding on interest and dividends, a provision later repealed over the president's objection.

But this was just the beginning. In 1982 Reagan supported a five-cent-per-gallon gasoline tax and higher taxes on the trucking industry. Total increase: $5.5 billion a year. In 1983, on the recommendation of his Spcial Security Commission— chaired by the man he later made Fed chairman, Alan Green-span—Reagan called for, and received, Social Security tax increases of $165 billion over seven years. A year later came Reagan's Deficit Reduction Act to raise $50 billion.

Even the heralded Tax Reform Act of 1986 is more deception than substance. It shifted $120 billion over five years from visible personal income taxes to hidden business taxes. It lowered the rates, but it also repealed or reduced many deductions.

According to the Treasury Department, the 1981 tax cut will have reduced revenues by $1.48 trillion by the end of fiscal 1989. But tax increases since 1982 will equal $1.5 trillion by 1989. The increases include not only the formal legislation mentioned above but also bracket creep (which ended in 1985 when tax indexing took effect—a provision of the 1981 act despite Reagan's objection), $30 billion in various tax changes, and other increases. Taxes by the end of the Reagan era will be as large a chunk of GNP as when he took office, if not larger: 19.4%, by ultra-conservative estimate of the Reagan Office of Management and Budget. The so-called historic average is 18.3%.

Regulation

For all the administration's talk about deregulation (for example, from the know-nothing commission which George Bush headed), it has done little. Much of what has been done began under Carter, such as abolition of the Civil Aeronautics Board and deregulation of oil prices. Carter created the momentum and Reagan halted it. In fact, the economic costs of regulation have grown under Reagan.

Some deregulation has occurred for banks, intercity buses, ocean shipping, and energy. But nothing good has happened in health, safety, and environmental regulations, which cost Americans billions of dollars, ignore property rights, and are based on the spurious notion of "freedom from risk." But the Reagan administration has supported state seat-belt and federal air-bag requirements. This concern for safety, however, was never extended to the Corporate Average Fuel Economy (CAFE) rules, which, by imposing fuel-efficiency standards, promote the production of small cars. The shift to small cars will cause an estimated 10,000 to 20,000 highway deaths over the next ten years.

Bureaucracy

By now it should not be surprising that the size of the bureaucracy has also grown. Today, there are 230,000 more civilian government workers than in 1980, bringing the total to almost three million. Reagan even promoted the creation of a new federal Department of Veterans' Affairs to join the Departments of Education and Energy, which his administration was supposed to eliminate.

Trade

The Reagan administration has been the most protectionist since Herbert Hoover's. The portion of imports under restriction has doubled since 1980. Quotas and so-called voluntary restraints have been imposed on a host of products, from computer chips to automobiles. Ominously, Reagan has adopted the bogus fair-trade/free-trade dichotomy, and he was eager to sign the big trade bill, which tilts the trade laws even further toward protectionism.

Results

Reagan's fans argue that he has changed the terms of public-policy debate, that no one today dares propose big spending programs. I contend that the alleged spending-shyness of politicians is not the result of an ideological sea-change, but rather of their constituents' fiscal fright brought about by $250 billion Reagan budget deficits. If the deficit ever shrinks, the demand for spending will resume.

This is the Reagan legacy. He was to be the man who would turn things around. But he didn't even try. As he so dramatically illustrated when he accepted the plant-closing bill, there has been no sea-change in thinking about the role of government.

Source: https://mises.org/library/sad-legacy-ronald-reagan-0

Cleaning Up "Marxist Trash" is the Best Way for Bolsonaro to Build a Better Brazil

2019-01-18T07:57:00.000-08:00

Officially sworn into office at the start of the year, the (Jair) Bolsonaro administration has already captured international attention. Having been portrayed for years by Western media as a sinister threat to Brazilian democracy, in spite of being a successful populist candidate embraced by a diverse electorate, the same outlets have been quick to depict the new government as a hostile threat to minority rights. The real story, however, is Bolsonaro’s apparent commitment to the sort of ideological revolution that is desperately needed for his country to thrive. While history shows we should never trust a politician to deliver on lofty promises of liberty and freedom, the initial days of his presidency have moves deserving of praise.

To start, his inaugural address, Bolsonaro vowed to follow through on his campaign message of dramatically changing a government plagued by corruption and economic crisis:

"I stand humbled by the honor to address you all as President of Brazil, and stand before the whole nation on this day as the day when the people began to liberate themselves from socialism, from the inversion of values, from state gigantism and from political correctness. … Our flag will never be red. It will only be red if we need to bleed over it to keep it green and yellow."

He followed this up with a tweet vowing “to tackle the Marxist garbage in our schools head on.”

What’s encouraging here is that Bolsonaro is identifying that the true enemy of his administration is not simply a political rival or a series of bad policies that must be reformed, but the socialist ideology that has caused so much misery throughout the world and Latin America in particular. Correctly identifying the underlying problem is the best way to go about finding a solution."

This aligns well with Ludwig von Mises’s views about the importance of ideas in society. He wrote extensively about how the ultimate deciding factor to the success or failure of civilization has less to do with the politicians and institutions that have been built, but the underlying ideas that direct them. As he wrote in Economic Policy:

"Everything that happens in the social world in our time is the result of ideas. Good things and bad things. What is needed is to fight bad ideas. We must fight all that we dislike in public life. We must substitute better ideas for wrong ideas. … Ideas and only ideas can light the darkness."

Of course, a true ideological revolution requires more than simply political rhetoric and rousing speeches, the question will be how he is able to follow through with pro-market policies that will actually allow Brazil to succeed.

Read more at: https://mises.org/wire/cleaning-marxist-trash-best-way-bolsonaro-build-better-brazil

What Social Classes Owe Each Other

2019-01-18T04:13:00.001-08:00

What the Social Classes Owe to Each Other was first published in 1883, and it asks a crucially important question: does any class or interest group have the duty and burden of fighting the battles of life for any other class or of solving the social problems to the satisfaction of any other class or group?

Sumner saw that the assumption of group obligation was destined to be a driving force behind the rise of social management in the future. Capital owes labor, the rich owe the poor, producers owe consumers, one sex owes another, one race owes another, this country owes that country, and so on ad infinitum.

How right he was, how incredibly prescient, to see this coming.

The assumption behind all these claims, writes Sumner, is that society consists of layers and layers of hidden and roiling conflicts and fights that can only be resolved by state intervention. These conflicts are rooted in the supposed reality that one group wins only at the expense of another group. The gains of some imply the losses of others. The path to achievement in society is trod over the well-being of others, and, similarly, the plight of underachievers is due to injustice.

So ingrained is this model of society that it is rarely questioned in public life today. Our politics consists almost entirely of the working out of these supposed conflicts and their attendant demands via public policy. Sumner not only tackles this view directly, he makes a strong contrary claim: under freedom, no group is obligated by force to serve another.

Voluntaryism

He goes further to present a completely contrary model of society, one that highlights the capacity for group cooperation. It is not conflict that forms the basis of society but exchange, good will, private property, contract, free association, and liberty — all rooted in the still-radical idea of individualism.

Sumner writes the following:

"Society needs first of all to be freed from these meddlers — that is, to be let alone. Here we are, then, once more back at the old doctrine — Laissez faire. Let us translate it into blunt English, and it will read, Mind your own business. It is nothing but the doctrine of liberty. Let every man be happy in his own way. If his sphere of action and interest impinges on that of any other man, there will have to be compromise and adjustment. Wait for the occasion. Do not attempt to generalize those interferences or to plan for them a priori. We have a body of laws and institutions which have grown up as occasion has occurred for adjusting rights. Let the same process go on. Practice the utmost reserve possible in your interferences even of this kind, and by no means seize occasion for interfering with natural adjustments. Try first long and patiently whether the natural adjustment will not come about through the play of interests and the voluntary concessions of the parties."

Source: https://mises.org/library/what-social-classes-owe-each-other-0

Private Schools in Pakistan Are Being Suffocated By Red Tape

2019-01-17T11:37:00.000-08:00

Over the last decade, private school education has become a way of life for many Pakistani children. Unfortunately, private schools are being continuously “suffocated” by undue state bureaucracy.

Government regulation of private schools

The Private Edge

In Pakistan, a majority of middle-class parents would not dream of sending their children to government schools. They have and are constantly showing an increasing interest in private school options. Why? Prestigious private schools in Pakistan are likely to have teachers who are more qualified, with graduate degrees and higher level of training. Also the private sector are known to hire “the best person for the job”.

Over the last decade, private school education has become a way of life for many Pakistani children. As parents’ expectations and preferences change, educational entrepreneurs are responding with a range of services, and can be stamped to be acknowledged as the “new education industry”. Offering an even more tailored service, private educational institutes are a new breed of professionals who help parents out in their pursuit of quality education for children.

Private schools in Pakistan pride themselves on outstanding customer service. They go beyond offering just mandatory subjects and thus have been responsible for producing many leaders in politics, business and other fields, with the skills of adapting quickly to changes in technology.

Pressure

Unfortunately, private schools are being continuously “suffocated” by undue state bureaucracy. There has been an increase in the number of private schools who have been threatened and pressurized with legal action by a group of influential “alpha parents”. They have and are facing litigation over unjust demand of parents’ refusal to pay summer vacation fees. These “unrealistic demands” can be categorized as great dilemma facing private schools owners.

In a semester system, the complete 12 month fee is charged in two installments twice a year. In the current scenario, the private schools in Pakistan have provided relief to parents by billing on monthly and bi-monthly basis. However, what the group of ‘alpha parents’ and regulatory authorities have failed to consider is that all staff and teachers are paid for 12 months and accordingly, the rents are also paid for the complete year.

The private schools have to bear the administrative expenses, including rent, utility bills, and teachers’ salary, teacher training costs, all developmental work including repair/ maintenance and up gradation of buildings during the summer vacations. On such basis the decision can be countered in light of the ground and financial realities of schools as an enterprise. Apart from this, the private schools spend a huge amount on school security, an expense that is neither known nor charged to parents.

Therefore the rules and guidelines set by the regulatory bodies and authorities should not be directed solely towards lowering fees, as this could have an adverse impact on the standards and quality of education.

Regulators must look at ground realities before arriving at a decision regarding the fees. Else, a thriving private education sector that is filling in for the government’s continued failure to provide quality avenues for the educational needs of its citizens might well be razed to the ground, all under a misplaced sense of public welfare.

Read complete article: https://academiamag.com