Systematic risk, market and the State.

Market participants have taken taking system-threatening risks in the securities market. Many commentators have taken this to mean that government should intervene to prevent them doing so in the future. I explained previously why this won't work, but now I'd like to focus on how the State encourages and facilitates the taking of "systematic risk". First a definition, "systematic risk" is a risk that could rationally be considered to endanger the entire system it is taken within, necessitating a change to another system if a misfortune occurs. A system is "an assemblage or combination of things or parts forming a complex or unitary whole" (http://dictionary.com).

The theory behind the call for more regulation is simple, market participants have a motive to protect themselves from risk, but no sufficient motive to protect the market from systematic risk. Because any prevention of systematic problems costs the person or institution, but they don't gain the full benefit. Their own risk goes down and that's a benefit, but it's small compared to the full cost of the risk across the market. So the preventer pays the full cost of prevention but doesn't gain the full benefit. It's like paying to purify a entire river so you can take a clean shower. Therefore people theorise that a "domino effect" could happen where one firm goes bust sending one or more of their creditors bust leading to the bankruptcies of their creditors and so on leading to too many bankruptcies for the system to handle.

This analysis ignores the fact risks that could result in defaults to your own creditors are more expensive. Naturally there are creditors out there who will loan to risky people or companies. Just as naturally they charge more than more conservative creditors so announcing that you are taking a risk likely to endanger repayments costs a firm money. This includes any exposure sufficient to destroy the firm no matter how apparently safe the firm you're exposed to. Passively concealing the nature of your risk-taking costs just as much since creditors and investors naturally assume that if what you were doing were safe you'd rush to tell them of it. Actively lying about what financial risks you're taking is called fraud and it's easier to detect and harder to actually profit by than you'd think. Investors and creditors (as well as potential short sellers) have an incentive to ferret out the lies. So any "domino effect" would have to overcome continual barriers to this like bulkheads in a well designed submarine.

A risk to an entire system is more likely if a single factor affects all participants directly, or at least a large number of participants directly and the rest through their connection to those directly affected. A risk is more likely to be systematic if could cause sudden problems, without time for participants to adjust their actions to minimize the problem. Government intervention is of course the most likely thing to create such risks due to the sudden and universal change it causes.

The most obvious government intervention in financial markets is the setting of the "risk free" interest rate by central banks. Since all economic processes include a delay between input and output this affects all economic processes. It also profoundly affects the prices of productive assets. Paying more than the return on an asset divided by the interest rate loses money. For instance if a factory had profits of $1M a year and you paid $10M for it, interest rates of 10% lose you money. So high interest rates mean low asset prices and sudden increases in interest rates mean sudden reductions in asset prices for all participants. This can lead to capital adequacy problems, i.e. a company not a big enough difference between the value of it's assets and it's liabilities. Financial institutions need this gap to be big to reassure investors, creditors and regulators that they're not about to go broke. The usual response to capital adequacy problems is to sell off assets to reduce debt. If many firms have the same problem of course the market is swamped with assets and a good price can't be got for them. This is because the opportunity cost to the buyer of buying your cheap assets is buying someone else's even cheaper assets. Since the government can subject everyone in the system to this same risk the government IS a systematic risk.

So called "credit ratings" were in effect licenses to commit fraud. Since by definition investors in funds lacked either the motivation or the knowledge to investigate individual investments. Therefore they hire someone to do so and get them the best combination of risk and return. Without the previously mentioned motivation or knowledge they had to rely on credit ratings as a proxy for risk. Fund managers delivered not the best combination of risk and return but the best combination of return and credit rating. To make a promise intending to deliver something entirely different is fraud. No fund manager will be prosecuted though because they will all say "But we invested in safe things, look they're all AAA rated.". Indeed the government required that some funds (especially retirement funds) invest only in things rated highly by it's designated defrauders, Moody's, Standard & Poors and Fitch.

Ratings agencies didn't rate unsafe firms or securities highly because the owners and issuers paid them. Although this seems like a good idea a little thought we show that's a bad strategy. If you label every piece of rubbish as caviar why would anyone want to eat in your restaurant? Ratings produced solely because someone pays you to say something are worth about as much as the paper they're printed on, that being how much competitors could produce them for. The only point in producing a rating is having people believe you, and over the long term saying things that aren't true doesn't help that. The reason that ratings agencies went the short term route of simply saying what others wanted them to say is that they have no competition. It's a government-enforced cartel that fund managers can't even refuse to deal with. If they had real competition then people who invest according to what the most credible firms said. But since they don't have to compete they can simply maintain the same low standards as the other two firms and rake in the cash.

Maturity and the State.

I have recently [not so recently now, I left this post as a draft for a long time] been accused of "an impersonation of a spoiled brat" for refusing to take responsibility for the actions of my government. This is a common complaint about the enemies of the State, that they are not mature enough to accept things they ought to. So let us examine the accusation against me in particular and libertarians or anarchists in general.

The reason that "axiomiser" claimed I was immature was I would neither "shut the fuck up and accept the majority vote" or "make some effort to change peoples mind". I was under the impression that I was already doing the latter but let's examine whether this is a reason to accept responsibility for my government.

Let's assume that I can convince 100 people each in Australia, the UK and the US to vote for the candidate that most opposed the war in Iraq. Bear in mind I have NEVER convinced anywhere near this many people to do anything. This is what axiomiser was so upset that I would not accept responsibility for. Of these about half would have voted for that party anyway on other policies. Assuming a two party system and that each person has a 50/50 chance of voting for each party the chance of one vote changing the election is approximately 3/(number of voters). So basically bugger all chance of it EVER happening on a national level. Some chance perhaps that I could change one seat but that rarely changes who forms a government.

So given that I can't change the government, why must I accept responsibility for it? I can't change whether my mother's labor was painful should I accept responsibility for that? I can't change the mind of a terrorist, should I appologise for 9/11? I can't change my socks, should I be blamed if they stink? Oh wait I can change my socks, just a minute... Ok, that's better. But you see the difference, right? Socks, changable by me so I should accept them, or change them. Majority vote not acceptable by me so I need do neither. But the "axiomiser" can't accept this, because he's a spoiled brat. He thinks that he should be given what he wants and everyone should shut up about it. In fact that's what the State is, an attempt to get everyone to shut up about the rights and wrongs of giving the big boy what he wants. Maturity does not consist or resignation to the acts of bullies. It consists of acceptance of reality, and while reality says that the bullies win here, now, it also says that I don't like it. For those that don't wish to hear this, GROW UP!

Swine flu, inefficency and am I crazy again?

Ok, so I've been hearing about the swine flu, which naturally the MSM is declaring as a massive emergency that requires huge government action to prevent thousands of deaths etc. Now I'm not going to talk about the implict assumption that such actions is justified by "emergencies" or the responsbility of government for the rapid spread of such pandemics (given the persistent and large-scale subsidy of rapid transportation). Instead I'm going to make a case that government is seeking to maximise that amount of resources spent on these efforts rather than solve the problem.

This case depends on several things being true and if I'm wrong about any of them, please tell me.

The first is that I'm not an Einstein, a Linus Pauling or indeed the intellectual equal of any Noble prizewinner (with the exception of the "Peace" prize, I'll write something about that farce some other time). By this I don't mean I'm subnormal intellectually, merely that my intelligence is not such that it can routinely find implications of facts that nobody else in the world can. If I can see it, chances are other people can too if they want to.

The second is my understanding of the mathematics of epidemics/pandemics. Basically to be an epidemic the average number of people an infected person will in turn effect must be greater than one. If on average each new victim gives the virus to less than one person the total number of victims will be limited to n = a/(1-r) where a is the number of people infected at a particular time and r is the number of new victims each person infects. This is why schools, swimming pools, etc used to be closed, so that on average each person would interact with and have a chance to infect less people. If these measures reduced r below one then an epidemic could be nullifed without any effective treatment for the disease itself. Traditional responses to Ebola outbreaks (developed well before modern medicine) are an extreme example. Sufferers (or suspected suffereres) are simply left in their hut and food pushed in with a long stick. If the person doesn't collect the food for three days a torch is throw onto the thatched roof destroying the virus present in the victim's dead body.

Third is my understanding of what affects the how many people the average victim infects. One of the chief factors is how many people they come into contact with. This varies enormously over the population. Drivers, door-to-door salespeople, shop assistants and airport ticket personnel contact more people than housewives, computer programmers or carers, I will call the former group "high contact" and the latter "low contact" people. Anything that minimises the chances of high-contact people getting the disease is going to be doubly effective at reducing transmission. Firstly the chance of high-contact people getting the disease is higher because they obviously they have more opportunities to catch it. Once infected they similiarly tend to transmit the virus to more people for the same reason. The average number of people a person will infect during an epidemic is therefore increases with the square of his/her number of contacts minus the number of contacts*. If high contact people have a greater tendency to contact other high contact people (for instance if airports have large numbers of high contact people contacting each other) then the situation is worse, increasing with the cube at least of the number of contacts.

If this is true then it's obvious that a small investment in reducing average chance of transmission (either to or from) high contact people will have a large effect on total infections and therefore deaths. Reducing the chance of someone who contacts 10 times more people than the average person is close to 100 times more effective tranmission chances for the average person. What happens if his contacts are only a 10% more likely to be people like him (10 times as high contact) than the contacts of normal people? Well the average number of people infected by the people he infects goes up by close to 1000%, multiplied together this implies over a thousand times more infections from this person than the average person. All of this is an average which includes the possibility that he is never infected.


So clearly these sorts of people, if they exist, are a huge part of the epidemic pandemic problem, yet the targeting of vacinnes is generally towards the elderly, the young and other people who are likely to die if infected. Many of these people are low contact, in fact in the case of the elderly the lack of interaction is often a serious mental and physical health issue in itself. Now of course likelihood of death or serious illness if infected is rightly a factor in determining who should be protected. However isn't it true that the most effective protection of these people is the dramatic reduction in the transmission of the disease?

Now if I'm right about this then it logically follows that, not being a genius, other people could have also figured this out. This is particularly true of those who job is supposedly to prevent or reduce the death toll of epidemics/pandemics. So if they did so and ignored the implications, what other motive is there to do that but to continue wasting resources? The reason they'd want to do that is clear, so they can keep paying the politically influential drug companies and so that the UN's health employees have something to do.


* Because he can't infect the person who originally infected him, therefore the number of people who could infect him is c and the number of people he can infect is c-1.

The Underbelly of the State or the drama comes to the airport.

I'd like to start by offering my condolences to the family of Anthony Zervas, may you find peace and consolation. Mr Zervaswas murdered in full view of two police officers with guns and numerous security officers with clubs and pepper spray. Later his brother was shot and critically wounded outside his home. The police were waiting for backup, because having a gun against clubs isn't enough for them. Sure there were about 14 thugs, but 4 were fighting the other 10. All they'd have to do would be to scare someone who doesn't have a gun with their own guns, which is not usually difficult. The security officers weren't totally useless of course, they stopped other people from saving Mr Zervas. Now that may not sound useful, but it is. If the general public had stepped in and saved someone when the State, it's agents and those it licenses to protect people it would make the State look stupid. That would be far worse than someone dying. Of course the agents of the State could simply have yelled "Everyone start taking pictures" and the fight would have probably stopped. Not many murderers want their crimes in the holiday snaps of half of Asia. Even if they hadn't stopped at least we would have been able to identify all the attackers. Naturally you can't do this from airport security cameras because, 8 years into the "war on terror" security cameras still aren't good enough to identify anyone.

Of course the small-s state being New South Wales, our old friend Laura has to rear her ugly head. That's Laura Norder, the bitch of Macqurie Street. Every time politicians want to do something bad in Sydney they say it's for "Laura Norder". The murder and later shooting of the victim's brother were part of an ongoing bikie war. The worst kept secret in law enforcement is that this war is over methamphetaimes and hence the fault of the State. Even the mainstream media have said that the violence is the result of drug prohibition with the Sydney Morning Herald editorial openly saying so. The violence of the methamphetamine market was the subject of "Underbelly" the most popular series on australian television. So naturally Premier Rees says nothing about stopping prohibition, instead seeking to make bikie gangs illegal. The proposed law would allow the police to declare an organisation prohibited and not allow it's members to meet. They could also declare people part of these organisations. Of course the police don't have to say why they are making these declarations they just announce that from now on, if you see some of your mates you go to goal for 2 years. They don't have to prove that you and your mates were doing anything illegal, conspiring to do anything illegal or even that you were "consorting" with known criminals. Naturally laws against all these things are already on the books. Only those against whom a case cannot be made for any of these, or indeed anything else, will be caught by this law.

We are supposed to trust that people who let killers drive away in a taxi despite having 22 cops on the premises and cameras all over the place. These are the people who we're supposed to believe will handle their new powers competently and honestly. It's the same everywhere, when they don't have the competence to solve problems they want power to solve them without competence. Of course attempting to solve problems without competence simply creates more problems that the creator isn't competent to solve. Admitting incompetence to solve these new problems would lead to questions about the competence of their previous solutions so of course it doesn't happen. While people are allowed to use power, force in other words, to solve their problems this cycle will continue. While this cycle continues the people will continue to want their leaders to "get tough" because deep down, everyone knows them getting smart is not an option. And when it all goes horribly wrong, when the powers are used in ways that their supporters didn't expect, guys like me will say "I told you so.". When the lastest laws are used to crack down on antiwar protesters, unions, community groups that oppose whatever idiocy the government pushs on us, or bunchs of suspicious looking muslims, I want to be the first to say "No surprise". Because that's all the government ever gives you, the feeling of wisdom that comes with predicting what others wouldn't. Note not couldn't, they could all have predicted it. They just decided not to.

The murderless club basis for objective morality.

It has been claimed by theists that without god it is impossible to have objectively-based morality. Leave aside that doing what someone else says you should do is not an objective morality, how hard is it to make a basis for morality that is objective? Well I thought I'd try and it took it less than 10 minutes.

Imagine a world without rules, no morality, no law, no binding customs (although they might have habits). Obviously you would be better off with some system of rules to limit undesirable behaviour. One of my friends comes up to me and says "I want to be able to trade without fear of being murdered and my cargo stolen. What can I do?". I say well let's form a club with only 1 rule, if you murder someone in the club you are expelled. The only bad thing about being expelled is that members of the club can then murder you without consequence just as they can murder people who never belonged to the club. This club would be very popular. So would a club that had as it's condition that you don't steal from the other members. It is objectively true that if any of these clubs were opened in such a rule-free world I'd join them. I know this objectively because I have sufficent knowledge of my own preferences. These preferences are subjective, but my knowledge of them is objective. So if I base my morality on not doing anything that would get me thrown out of a "rule club" that I join it's objective morality.

Like I said, less than ten minutes.

The regulatory cycle or why new rules aren't the answer.

Deregulation has taken a lot of the blame for the current crisis. Most of the people saying that conclude that if deregulation caused the problem, regulation can solve it. They are wrong.

To understand why you must abandon the common, if largely unconscious assumptions about regulatiors and how they produce regulation. Generally people assume that wise, impartial regulators sit down, look objectively at the facts and, unswayed by intellectual fashion and the irrational exuberance or depression of the market and society, make wise, impartial, objectively based decisions. If that were true then why is it that such decisions are only made exactly when they are not needed, as is presently happening. Currently the US government is writing rules about overextending your company, investing too much in doubtful financial assets and everything nobody wants to do any more because it loses money. No doubt other governments are too. It's like making sure everyone has cleaned the leaves out of their gutters after a bushfire has demolished half the town. To understand why they're passing such laws and regulations now, you must understand the financial regulatory cycle and how it trails the monetary cycle.

Stage one of the regulatory cycle is Crisis, caused by the excesses of monetary expansion. Crisis creates a demand for immediate action to combat the cause of the present catastrophe. The cause is however the state of the regulatory cycle some time in the past so correcting it has no immediate effect.

Nevertheless the second stage, Action occurs. Regardless of the immediate effects of Action the monetary cycle moves on and things correct themselves. The Action may speed this up, slow it down, make it easier or harder, more expensive or cheaper.

This leads to the third stage, Inefficency. During Inefficency actions taken during more frantic times are observed to be hampering the markets efforts to create wealth. Since the market is still in recovering from a bust there is little chance they are actually preventing bad behaviour anyway, since that only happens in the boom phase. Thus their effect is to impose large present costs for very small or nonexistant present gains.

This leads to the fourth stage, Circumvention. Firms in the financial market do two things. Lobbying to remove the restrictions placed in stage 2 occurs to the general appathy of the population. Few if any voters and political masters understand the present rules and why or even if they're important. Resistance to selective deregulation is low as the circumstances that led to the need for the regulation are gone. Firms also develop practices that go around the current rules while having largely the same effects as the practices forbidden. This makes the original regulations even less important, even counterproductive if they simply shift activity to less transparent or accountable sections of the economy. Circumvention accelerates when during times of monetary expansion because during those time the need for caution and restraint is weakest.

The combination of the monetary boom and Circumvention above leads back to Crisis.

You might ask, "Is this cycle inevitable?". Might we act appropriately and promptly to prevent such a destructive turn of events. The answer is "Why would we?". During the times when such action is neccesary by it's nature few people think it's warrented. If people were in general worried about the negative effects of asset price bubble then we would not have one, since a precondition of such a boom is that people don't think it's either happening or going to happen. To impose or keep regulations to prevent it happening regulators must go against the wishes of pretty much everyone who's paying attention to their activities. They must do this despite not being able to offer any evidence that their actions are warranted, predictions being notoriously difficult in economics. Those wanting to remove restrictions can point to solid evidence of costs in the here and now. In any case in many or even most cases they're right about the high costs and low benefits of regulation, because much of the regulation was passed in panic during stage 2 (Action) when it was felt there was little time to think through the costs and problems. A case could and will be made that the actions in the Action stage were hasty and ill-considered and possibly now out of date. A general mood of caution and pessimism will defeat this case, which is another way of saying regulation won't be abandoned until shortly before it's needed.

And yes, my blogposts are like buses, none for yonks then three come at once.

Dexter Morgan for President.

Recently the TV show "Dexter" has won my heart. Something about the deeply flawed individuals struggling both make sense of mysteries and keep their own facinates me. For the uninitiated the title character (Dexter Morgan) is a serial killer who preys exclusively on murderers. His foster father taught him to direct his sadistic and depraved instincts to something approaching justice. He claims not to be able to resist these instincts, but there is little evidence that he tries. Dexter is a bad man, if he makes the world better or fairer, it is in spite of his nature, not because of it. Relief floods his face when he finds out the Ice Truck Killer has not been found and will be killing again. The deaths of the victims are nothing to him compared to the prospect of taping the killer to a table and cutting off his head. Evil dictates, directly or through his efforts to conceal it, almost every one of his actions.

Part of Dexter's appeal is of course revenge fantasy, the idea that there is someone to inflict misery, degradation and death on those who frighten us. Dexter is powerful in a way we cannot and will not be. We are unable to dedicate the time and energy needed to find those who scare us, he gives up almost all his free time for it. We lack the strength and skill to seize them, he has it down to a routine. We fear the consequences of pursuing monsters, he can't be dragged off their track. Our conscience makes us hesitate to wound, his is not a problem. Every angry thought summons up a wish for a tame Dexter, to give us the blood and yet keep it from us.

The State is our tame Dexter Morgan. We know the State is evil. We know of it's murders, it's enslavements, it's discrimination, it's lies, it's unjust imprisonments and inhumanities of every stripe. We excuse them like uncles who get a bit overenthusiastic with the bottle at times. They not alcoholics, not like the neighbour's addict black sheep. But deep down we know the truth, that the State will always come back to badness, to viciousness, to evil, to power. We want to know that we can unlease that badness against our enemies, crush them and yet remain untouched. People who wouldn't shoot a dying dog are willing to let the State commit all sorts of horrors in their name and at their behest, safe in the knowledge that they did nothing.

However Dexter, unlike the State, does not believe in his own goodness. He knows, and we know, that he is deeply evil. He does not contend that he does what he does for the common good, and we would not believe him if he did. We do not celebrate our dedication to helping his bloody work. We do not feel that attacks on his credibility or honour are attacks on our own. Yet with the State we do. We feel insulted by slurs on "our" countries honour, and react emotionally to them, sometimes regardless of the evidence. Yet we know that the State is a far less discriminating killer than Dexter. They get it wrong all the time. Indeed more innocent Americans were killed by American cops (by the State's own figures) than by terrorists in all but 2 of the last 16 years. And in one of those it was pretty close. In none of those years did terrorism kill more Americans than the direct and indirect effects of government violence*. Yet most people defend it and justify and minimise it's crimes. The true danger of the State is not it's evil but the willingness of people to call it good and thus not act against it.

Currently the American State is run by people who openly boast of extrajudicial killings. They are openly declaring themselves to be Dexters, but nobody thinks they have his precision, self-awareness or intellect. So why are we settling for second best? Why not get the real deal? Dexter Morgan for President, because lesser evils are for wimps.




*Even if you don't count terrorism as the indirect effect of government violence.

Counter-arguments to central bank supporters or why you're being given bad paper on this deal.

This paper is written for Michelle, who couldn't think of a good reason why we need central banks but thought it was "silly" not to have them. So this is an attempt to anticipate the arguments for a central bank and counter them.

Firstly there is the argument that the government should determine the rate of interest. Why? Interest rates are a price, the price of future good and services relative to present goods and services. We don't let the government set the prices of petrol, shares, rice, sex, books or chocolate because they set it too high/low and cause shortages/surpluses.

Why would the correct price of getting something earlier be more suitable to government calculation than the price of anything else? The market-clearing price is the price at which as much is produced as is consumed. Interest rates are the same, the correct one is where as much money is availible to borrow as people want to borrow at that price. Any greater and more immediate satisfaction is provided for future reward than people want, any less and the opposite. The correct rate depends on people's personal preference for immediate versus future value. There is no way for the government to know personal preference. That's why they can't efficently decide how much petrol, shares, rice, sex, books or chocolate should cost.
Stability is a common argument for central banks, which is surprising considering that central bankers themselves have admitted to causing the greatest example of instability in economic history. Well perhaps that's unfair, perhaps the great depression wasn't as big as some of the many hyperinflations that central bankers have not admitted to causing. The problem is that central bankers caused all of those too. The extremes of financial and monetary variability are the direct product of the actions of central banks. To argue that they create stability you'd have to find more examples of financial crisis before the advent of central banking than after it. The trouble is that there's only been one real bubble where the government didn't have control of monetary policy and that's "Tulip Mania" (say it with massively overpriced assets). There's been more bubbles than that in America alone in one Fed chairman's reign.

Of course perhaps central bank is more stable but the instability comes in greater doses when it comes. The problem with that theory is 1) there's no evidence of it and 2) there's is good theorectical reasons to disbelieve it. Financial and monetary instability is based in part on perceptions of instabiility itself. If there is a perception that a central bank will lead to large instability then that will by itself cause small instability. We know that there certainly is a perception that central banks contribute to extreme inflationary instability (hyperinflation) because anyone who studies it notices that they're the only known cause of it. And financial markets are comprised of people of people who know at least that much economics. Since at least Bernake's admission that "We [the central bankers] caused it [the great depression] they know that central banks cause extreme deflation too. So why would market be more stable knowing that fundamental decisions are being made by an institution that, every so often, causes massive instaiblity?

Of course there is more to stability than perception. Individual shares, debts and assets values vary depending on individual factors, but the market as a whole varies according to underlying economic facts. So which monetary system would cause these facts to change unpredictably and quckly? The one where a stroke of the pen can increase or decrease money supply by an infinite amount or where it can only increase after years of searching and expensive extraction.

Keynesian theories of economic instability are based on "irrational exuberence" and systematic stupidity of market players. Such stupidity is extremely expensive so why would it persist? Those who resisted such insanity could simply sell assets during the expansionary phase, buy more during the contractionary phase, rinse, repeat. This process would stabilise the market by itself. These "countercyclical investors" might not be rich enough to significantly stabilise the market, but they get rich every cycle. They also get access to greater control of other people's funds as there successful record grows.

Assuming a 4 year cycle with alternative 10% over and under valuations makes a 5.5% return a year on top of normal investment returns. Anyone who gets those returns for say 8 years in a row can easily borrow more to leverage their money. Leverage of only $1 of debt to $1 of your own money gets you 11% p.a. return above market. Such a system working since say 1913 would pay 2,021,543% plus normal investment returns. In other words if you had invested in such a system when America founded it's central bank and borrowed a modest 50% of the funds, you would have 20,215 times your what the average investor would have. And that's assuming you actually buy and sell things, rather than derivatives, which reap higher rewards when you guess right*. The "Mystery of banking" would therefore be, why don't these people own everything? They have had the chance to use this strategy since the first stock exchanges, why weren't they rich enough to stabilise the market by the time America got it's central bank? There must be something actively working against stability. I contend the central bank is it.

It has been contended that central banks should try to set the inflation or interest rate for the common good. This is impossible because, as with all prices there is no common good. That which is good for buyers is bad for sellers. In the case of the inflation and interest rate any movement that is good for those that borrowed money (inflation up, real interest rate down) is bad for those that lent it.
Balancing the interests of these groups is essentially a political decision. In fact it's a class warfare decision since the richer you are after all the more money you usually borrow (the poor can't afford loans). Why would anyone expect that it would be make objectively, if that's even possible? Any government organisation that controls interest rates is either going to be democratically accountable or not. If not then it's going to be used to benefit the ruling class. If it is then it's going to be used to benefit that portion of the population that is most able to intimidate their representatives. In neither case is it likely the good of the country will be the deciding factor.

Without a central bank, who would print the money? Well anyone who wants to and can convince you to accept it. There is no particular reason why printing money should be a government activity, let alone a government monopoly. After all what do you want from your money that only government can provide?

Firstly you want it to be accepted as money worth a predictable amount. You don't want to go to the store and find it's worth less than you expected it would be when you got it. When that happens people's economic plans are thrown into chaos because they cannot properly value things over time. Similarly you don't want it to be worth more than you expected, otherwise those who owe $100,000 suddenly find they need to pay back with goods and services they thought were worth $105,000. Either way people simply can't operate efficently. When people hear that the metric standard for mass is losing micrograms of mass they're rightfully alarmed, they should be just as alarmed when the standard of value unexpectedly changes.

Note that this does not mean that the value of money can't change, just that it should be relatively easy to predict when and by how much. This is not the case in central banks, which even their supporters claim are secretive and operate under principals that most people don't understand (quick what's M3? Is it better than M1? Why?).

Commodity based currencies on the other hand are a constant relative to the difficulty of producing the commodity. If the $US is defined as worth 1/20th of an ounce of gold then any someone can produce an ounce of gold for less than $20 they will. The increased supply of money relative to other goods will push up prices until it costs $20 to produce it again. The only way there could be a change in the value of money is if it became a lot harder or easier to produce the commodity relative to other goods. This happens slower and more predictably than arbitrary decisions of government officials. If a currency is based on a basket of commodities, with each unit entitling them to set amounts of each commodity, it would move even slower and more predictably. I'm not sure the world's ready for the McDollar based on the Big Mac though. These currencies can be issued by anyone who people trust to actually fork over the underlying commodity.

This brings us to the issue of trust. How do we know that private issurers of currency will actually honour their promises? Well the same way we know that the mechanic won't steal our car and that the child minding centre won't sell your kids to white slavers. In any case it's a moot point since we don't know that government will honour it's promises. The American government had promised to provide 1/20th of an ounce of gold per dollar, it then decided to only provided 1/35th. That's better than the British though who only a few years previously had refused to provide anything of value at all for the pound. Various hyperinflations under fiat money make such thefts look like small potatoes.

Secondly money should be transferrable with the minimum of cost. This includes being acceptable in as many places in as wide an area as possible to reduce the costs of changing money into something acceptable to the seller. Governments only advantage here is that it can threaten people with violence if they do not accept their notes. This is somewhat unfortunate to those that don't want to accept them, often with good reason. There is no reason why the free market can't design widely accepted money just like they design widely accepted credit cards. If there is a demand for money that can be spent from Bagdad to Cordova the market will provide it**.

Attempts by governments to provide international currencies depend on unifying fiscal and monetary policy across many nations. That hasn't worked out as well as it should. In the mean time fiat currencies vary in value relative to each other making international trade needlessly risky and therefore expensive. When money was gold and silver people didn't care what country your coinage was from as long as it had the weight of metal***. Imagine getting off the plane anywhere in the world and not changing your money. Well actually you don't need to imagine it, credit card companies already provide that service.

Thirdly money should be hard to fake and easy to differentiate from fakes. That is not only should it be hard to make copies of the money, but when people do it should be relatively easy to detect them. Again there is no particular reason why governments should be better than private enterprise at doing this. It is possible that government monopoly would mean that money is more familiar (since you don't need to remember what several competing firms money looks like) remember there is only a monopoly within the territory. Free market provision of money could easily lead to less issuers of currency.

* Derivatives are financial instruments like puts and calls where you don't actually buy or sell things, you buy or sell the right to buy or sell things. For instance a put is the right but not the obligation to sell a thing at a certain price during a certain time period a call is the opposite, the right to buy. If you buy a put for say 20,000 tonnes of X at a price of $100/tonne and the price goes down to $90/tonne during that period you've got something worth $200,000. If the price is stays above $100/tonne you're not obliged to buy or sell anything, but you've wasted the money you paid for the put. Depending on how likely people thought the price was to go below $100/tonne it could be very cheap. Given that in the "irrationality' theory prices are quite likely to be much higher/lower the market thought they would be profitabe derivatives will often be cheap.
** Those that get the reference will should have a good profit. ;>
*** With some exceptions, the priests at the Jewish Temple insisted on shekels, hence the presence of money changers.

The Dark Knight is darker than you think {SPOILERS}

In the latest Batman movie, the Dark Knight there is a scene with two ferries. Stop reading now if you haven't seen the movie and don't want to spoil the suspense. The Joker plants bombs on each ferry and tells the passengers of each that they can save themselves by pressing a button that will blow up the other boat. One of the boats is filled with criminals that Harvey Dent has arrested under RICO statutes, basically most of organised crime in Gothan, plus guards. None of these have been convicted or tried yet. The other is filled with typical Gotham residents trying to get away.

On the "civilian" boat many people immediately cry out to press the button. Those in charge are intimidated into allowing a vote on whether to murder 500 people. Admittedly many of them have commited heinous crimes, but a deliberate killing without even an attempt at a trial is still a murder. The vote goes something like 350 - 150 in favour of brutal murder but those in charge refuse to push the button themselves. They then hand the button over to on of the passengers who also cannot bring themselves to personally kill 500 people.

I have heard it said that this is a hopeful and positive thing, that it lifts the moral stature of the typical Gotham citizen above the dregs. To me not tripping the switch when you voted for someone else to do so is nothing more than moral cowardice overwhelming physical cowardice. Think about it, why do you vote for something? So that if everyone else is tied on the issue it goes your way. There is no other purpose in voting. If you are on Socrates' jury and you vote for Socrates to be killed and it's not going to be a tie otherwise your vote changes nothing. If it would be a tie otherwise then kill him. To then say "Well I'm not going to do the thing that actually kills him." is a lie, since you already have. Three hundred of that boats passengers tried their best to blow up the other boat when nobody knew who was doing it. None of them had the guts to do it out in the open. To me that puts them beneath contempt. To be a multiple murderer is bad enough, but to be one who doesn't even have the guts to pull the trigger himself? To be willing to sacrifice 500 lives but not your reputation? I call them scum.

That said the reason I would have voted no would be that of course the Joker rigged the triggers to their own boats (remember his "information" on where Harvey and Rachel were?). Whether the convict who threw the trigger out did so because it was the right thing to do or because he realised this we'll never know.

Ron Paul is a conspiracy theorist, are you?

There is a popular saying that if there are two explanations for an event, conspiracy and incompetence, go for the incompetence explanation every time. The problem with this idea is that it's obviously untrue. If a candidate you dislike had recieved political donations from a neo-nazi and failed to report them in accordance with the law, which explaination would you go for? I thought so. Welcome to the "conspiracy theorists" club then, meetings are rarely held and only attended by police spies.

Yet membership in this club is somehow looked down apon as unhealthy, even insane. It's as though no sane person would say that conspiracies happen, and yet every day we see people behaving as though they did. Do act as though everything your government says to be true or do you assume that some of it is lies and distortion? Of course you act as though they lie, which is why you like investigative reporting? How about other governments? Do you get your news about countries from their governments press office or do you prefer that someone digs deeper? Do you think that political parties are engaged in a quest to show you the truth or to spin it? Of course in all cases you answered "cynically" to all these questions. Your beliefs and behaviour were in all cases that of a "conspiracy theorist", yet you are ashamed of it! If asked you'll deny it why?

Well isn't the answer obvious? People have acted in concert to make you feel that way. And have the done so openly or claimed to be merely expressing "common sense"? Yep that's right, it's a
[post ended due to technical problems]

A moral election.

Imagine if you will going to two job interviews on the same day and telling both that you had the other interview and take the best offer. Imagine also that both employers wanted you and sent you details of pay, conditions and how the company operates including the broad outline of it's business plans. One has a great dental plan, mediocre superannuation, excellent pay and highly successful strategy of firebombing the buisnesses of competitors and murdering their employees if they attempt to bid for the same contract. The other has no dental plan, reasonable superanuation, the opportunity to learn more valuable new skills and does not use violence in it's business. Would you spend any time at all wondering who to work for? Of course not unless you're a sociopath, yet this (Australian) election people are doing exactly that.

They are deciding that although they don't think the use of lethal force in Iraq is justified or rational they are going to vote on the basis of who can give them enough goodies. Free dental work, more free education (if it's worth it why don't people pay for it?), better hospitals, they think of everything that can be taken from someone else's pocket and given to them. In no other situation do people think like this. Only in politics is it OK to be this mercenary when issues of life and death are at stake. And yet people will claim they are voting on the basis of a "fair go" or "moral values". My arse they are.

They're not voting on the basis of common sense either. The latest war on drugs nonsense is proof. I can't fight the war on drugs because they're too expensive so I have to fight the war clean and sober. Anyway they're going to "quarantine" the welfare payments of people convicted but not jailed for drug offenses. The idea I suppose is that they can prevent drug takers spending money on drugs and get them to spend it on their kids, a new bible I don't know I lost interest. Of course this qualifies as the second easiest to dodge bad social security idea in history. The worst was that "work for the dole" scheme where all you had to do was claim to be doing $62 worth of work a fortnight to avoid the obligation. This isn't quite as easy. You actually go into the supermarket, buy things on someone else's shopping list and have them pay you for them later. So really less trouble than getting the drugs in the first place. Fuck I hat it when it takes longer for the government to explain the scheme than for me to figure out how it's fucked.

Oh and BTW remember those new "road safety" laws prohibiting P platers from taking passengers at night (or was it any time? DKDC)? Well it turns out that teenagers responded to said laws by carrying their friends in the boot (trunk) or lying down and thus unseatbelted. So another effort by the powers that be to make us safer through coercion failed. And I also have failed to predict that failure months beforehand. So from now on there's a competition. As soon as I mention an effort to make us safer everyone send in how they think it will bankfire. A special "No Prize" awarded to the first accurate prediction.

Andrew Johns a role model for our times.

A lot of people will say that Andrew Johns has set a bad example to our kids. Those little nippers who looked up to him have been given the wrong lessons. On the contray his behaviour on all occasions taught exactly the right lessons for those who wish to succeed in modern society.

Lesson one; If you like to take drugs and can avoid negative consequences for doing so, take drugs. Specifically take drugs that won't show up on the deeply intrusive drug tests you're
made to take. And take them on the off season wherever possible.

Lesson two; Do not complain about the deeply intrusive drug tests you are made to take for your high paying job. Never mention the fact that it's none of your employers buisness what you do in your leisure time. Never mention the fact that it's none of your fans buisness what you do in your leisure time. If asked about drug tests say they are neccesary to keep the sport clean. Do not ask why we need clean athletes more than clean taxi drivers, politicians, or sports adminstrators. Never make clear the distinction between testing for performance enhancing drugs and recreational drugs. Go along with the claim that the testing is all about keeping the sport fair, even though testing for coke, ecstasy or marijuana has nothing to do with this.

Lesson three; If asked about effects on drugs be very much against them, even though the effects of drugs on you are overwhelmingly positive. Never imply that there would be any situation where taking drugs is the right thing. Unless of course a doctor orders it, and even then if some blowhard cop or administrator says otherwise immediately fold like a deck chair.

Lesson four; If caught doing something some people think of as bad do not defend your behaviour in a principled manner. Make excuses that clearly show remorse, even if the behaviour hurt no one and was none of anyone else's buisness. If there is no evidence of any harm in your case do not explore the implications of this. Specifically do not say that there are people who take drugs who benefit from it and they should not be punished for this. Instead invent negative consequences you have suffered so will be pitied and therefore excused. It doesn't matter if there is no evidence for said drawbacks or considerable evidence against them in your case. Claims of harm to family life are especially effective even when all evidence is that your family life is fine.

Lesson five; An ounce of acceptability is worth a tonne of credibility. For instance confessing that you like drugs because they are fun would be bad no matter how obvious. "Confessing" you needed drugs to handle the pressure of being a football star, even when you say in the same statement that you mostly used in the off season where the pressure is much less is much better. Remember, it doesn't matter if the statement is credible, it matters whether people will pretend to believe it.

Lesson six; Always present your interaction with drugs as a "battle", a "struggle" or some other noun that implies that you have a real problem with drugs. Do this even if it's clear from your own statement that you can quit using drugs for months at a time with no negative consequences.

Lesson seven; Reform. Reform totally and never sin again. Do this as often as is needed.

The big lesson that we learn from the Andrew Johns debacle is that sports stars making sports stars role models makes no sense. A good role model would have been honest with reporters and with their fans. They would have said "You know what? It's none of your buiness if I take drugs. It's none of my buisness if you do. You should stop assuming that just because someone takes illegal drugs their lives are worse for it. You should stop assuming that the messages sent by people paid by powerful sporting bodies and through them powerful media organisations are correct. You should think for yourselves about whether what I did was wrong. And if you come to a different conclusion than your teacher, your parents or the cops that's OK. If you see someone doing something illegal and you approve of it, that's OK too.". Of course nothing of the kind will be said by anyone who wants to keep the approval of the mob, as all celebrities do. So don't use sporting stars as your role models. Use those who act in principled ways.

The Unhealthy Obsession with enslaving me.

Gerard Henderson (SMH july 3) has a right to be unhealthily obsessed with terrorism. It doesn't follow that those that aren't are committing non sequiturs. Nobody claimed that there was a causal link between AIDS and terrorism Mr. Henderson, but there is a causal link between AIDS deaths and the war on drugs. Deaths caused by government policy in the West outnumber deaths caused by terrorism even assuming only 10% of AIDS deaths resulted from policies that encouraged needle-sharing.
Governments do not have the right to be obsessed with terrorism or anything else because by definition obsession is excessive focus on a thing to the detriment of other things. The fact that a population was attacked does not give it's government a right to destroy it's people's freedoms. Historically the death toll from government limitations on freedoms dwarfs that from terrorism. September 11 added up to about 3 average days of Nazi murdering or 4 days of Soviet murdering. Clearly what we should be "obsessed" about is the limitation of government power, something Mr. Henderson used to be concerned about himself.
Nobody denies that islamic terrorists want to destoy our way of life, but why should we help them?

Another Pathetic Excuse for Coercion (APEC).

There are types of laws, those designed to punish the guilty, those designed to hurt both the innocent and the guilty and those designed to hurt only the innocent. The new laws put in place for the APEC summit are the latter. Nobody who should legitimately be detained will be detained by these laws, nor will these laws serve any purpose other than to prevent the exercise of a persons rights. Nor is it the case that this is the result of ignorance or stupidity on the part of legislators, it is the sole consequence of malice. Put plainly these laws are acts of conscious evil.
When people are arrested under these laws they are detained for a period determined by politicians with no fair trial, either to determine guilt or an appropriate period of detainment. Judges will be required to have a presumption in favour of jailing people, who have not been convicted of anything. This is not only a blantant violation of their right to due process and presumption of innocence but wholy unneccesary for punishing the legally guilty. The legally guilty are by definition provably so, and therefore evidence of their wrongdoing can be put before a judge. Judges routinely remand defendents in custody if the benefit to the public interest outways the private interest in not being detained. Not only are the legally guilty detainable by this but those who the judge thinks are likely to be guilty and to reoffend while on bail. The new laws do not affect this, they only affect those a judge would not think are likely enough to offend that their remanding is justified. Only those the judge thinks are not a threat suffer. They suffer at the sole behest of the police, with no judical input whatsoever, contray to the Magna Carta. That’s happening a lot lately mostly (although not in this case) due to a ruler called John. Gee what happened the last time we had a ruler named John and our rights weren’t being respected? Could we do that again? Would that work?
The argument will be advanced that these measures are neccesary to protect the public, but as I’ve shown they only affect those who are no identifiable threat to it. So how do they protect anybody? Well perhaps they protect us against people who are a threat but can’t be proved as such even to the low standards of a bail hearing. This is a rediculous argument, the whole point of a bail hearing keep people in jail where the cost to the community of being free until trial is higher than the cost to them of letting them free until them. Therefore this law only results in detaining those who it is not worth detaining, thus costing the community through detention of it’s members. So the protection is evidently not worth the cost as judged even by those the state hires to make such judgements. Bear in mind these are people are paid by the government, not the community and responsible to the government not the community. So it’s asking for the power to lock people up when even people it pays won’t back it’s decision to lock them up without a required presumption (i.e. prejudice) against them!
However there’s one intelligent suggestion Iemma and co., random police searches. I’ve wanted to randomly search police for years. It’s amazing how often they’re carrying dangerous weapons. They claim they carry them to defend themselves and enforce the law. However I’ve checked and according to the new laws I’m not allowed to have guns for that purpose. Some people have suggested that the police randomly search people in the city, which makes no sense. It’s an admission that you have no idea how to stop terrorism and now you’re just guessing what might work. Even inveterate sociopaths do not generally have incriminating evidence right on them. The terrorist population is less than 1/100,000th of the population, unless there’s more than 40 terrorists in Sydney right now. So clearly if the aim is to catch terrorists the resources wasted will be massive. Since any terrorists will be aware of these searches they will have scouts out to guide them away from points where they might be search. Of course if the idea is to get the populace used to warrantless, unjustified searches and random police harrassment it’s brilliant.
Those who drafted and passed these law are not ignorant of the law, most of them are qualified lawyers and/or experienced legislators and those that aren’t have the advice of others that are. It is ludicrous to expect that legislation to could reach parliment without a lawyer examining and advising it’s proponents on it’s actual effect. This is particularly true regarding the NSW labour Right who excel in intelligence and knowledge, if not morality. So we cannot conclude that these laws were a mistake, they were a deliberate attempt to subvert our freedoms for political gain and thus a violation of the oaths of office of all the legislators who either voted for them or advanced them. Simply put they are immoral and somewhat treasonous and those who voted for them mostly knew it.

Why Labour's policies are the Liberals fault.

The Labour Party's new labour policy has just been announced and from what I can tell it's a shocker. They openly boast about how they'll be an interfering busibody in every shopping centre ready to tell you how to relate to your workers. But I don't blame the Labour Party I blame John Howard, who was the one who usurped vast power over the labour market from the states. When labour relations were largely a state responsibility each state competed with the others to have a good investment enviroment. As much as the unions wanted them to screw over their employers and as much as the Labour Party wanted to oblige them they had to contend with the possibility the employers would flee. With the decisions being made at national level it is now far more expensive to flee their reach and so far more onerous burdens can be placed on the shoulders of employers or non-union employees with non-standard contracts. The new policy is an entirely predictable, and predicted outcome of the WorkChoices initiative. Of course few will actually blame Howard for it because his supporters will pretend to see no fault and his attackers will see no fault with the policy. I just wish I had predicted this earlier so I could claim to be a pundit.

If voters have to be registered, does that mean they're lethal weapons.

So anyway I sucumbed to my basest instincts last Saturday and voted. Yeah I know, STR-readers www.strike-the-root.com, I'm scum. You'll be happy to know my depraved attempt to force others to live by my choices failed. Although given the choices they chose to live by that's no good thing. In the word's of the Sydney Morning Herald "the worst government in Australia just got reelected". Well arguably sending us to war on a lie makes the Feds worse but in terms of sheer incompetence the NSW government unquestionably takes the cake. They then sell the cake to a politically connected private firm and agree to close lines at other bakeries so you have to buy the cake from said private firm or starve half to death waiting for lunch. Then the former premier gets a $400,000 a year job advising on cake marketing.

There will perhaps be vicious rumours that I voted for Peter Debnam, the least competent opposition leader in NSW history. This is a lie. I voted against Iemma, see the difference? Ok, you got me there is none in effect. The choice was between a party that had failed in every major area I could think of. Roads, hospitals, police, urban planning, civil order, everything. With the singular exception of reducing the state debt (which will of course increase again when they spend money to fix the problems after the election) they have done nothing any sane person would vote for.

And the mistakes weren't understandable, average mistakes they were whoppers. I mean what sort of idiot has a roads policy that deliberately increases congesting on public roads to increase the revenue of a private road proprietor? Did they really think that wouldn't leak? And then they tried to get the private road operator to simply waive those clauses of the contract, a contract they had paid the State government about a hundred million to get. Even assuming the directors were incredibly generous (with other people's money) how in the hell did they figure the shareholders would let them? Go back to law school guys, it's called fiduciary responsbility to the owners. The directors are smart enough to know that, after all they were smart enough to hire guy who was premier at the time the deal was signed. I wish I could get a job at several times the average wage after doing my job as badly as he did his.

Then there's the planning power fiasco. Basically nobody owns any land really in the land of the long weekend we just own the right to have our development applications rejected. However at least they're rejected by a semi-accountable, semi-transparent council that has to obey certain rules and that we can take to court. That's not good enough for our lords and masters who wish to be able to inflict any abomination on our communities while retaining the power to forbid anything more offensive than a new veranda light. So Frank Sartor, minister for planning is given the power to override all development laws, including enviromental laws, regulations to do with traffic congestion, native title, the whole bit, to approve anything he thinks is important. Naturally whether or not the project is backed by a rich property developer with bags of cash to donate to NSW Labor has nothing to do with it. That's the sort of rubbish I expect from leftists like http://www.lewrockwell.com/ and their ilk. Mr. Sartor's new powers have been described as "modest", by Mr. Sartor. Mr. Sartor is very rarely so described.

The trains are a shambles due to persistent mismanagement for over a decade. The only way they could stop "on time" records being abysmal was to change the timetable so they say the trains will be later. Hence there are less trains and overcrowding is overwhelming. Freight management's no better with ships waiting for days because the investment hasn't been made in infrastructure.

We're in a drought by the way so naturally the government is trying to tell us what to do with our water. This from the guys who wasted more water than anyone else in Sydney due to poor maintaince of the pipes. So the question arises, should we go for the massively expensive, enviromentally destructive, desalination plant that residents already hate before a sod of earth is turned or the clean, cheap, energy efficent recycling. Iemma claimed that Sydney-siders wouldn't drink recycled sewerage, despite the fact that such is completely safe and already flows into our drinking water from Blue Mountains communities. Of course now the people changed their minds after watching "a current affair" or something but not our Morris. No he's wedded to the idea like Britney Spears after a bender in Vegas. Well actually the commitments lasted longer than that, indicating that Britney has smarter advisers.

But none of this is important. No, what's important is that the voters of NSW will vote against people who didn't bring in "Work Choices" but stands in front of the same banner as the guy who did. So policies are no longer important, it's sheer guilt by association now. The morons that gave Iemma a second chance to "get back to work" (given the job he did this is no promise it's a threat) bought the argument that Debnam was too inexperienced to run NSW. How much experience do you need to know that concentrating all power in Frank Sartor's hands is a stupid idea? How much experience do you need to know that ignoring infrastructure to make your financials look good is bad in the long run? Or that corrupt Private-Public Partnerships that include guarantees that the Private guys won't lose money mean that the Public guys will? I mean think about it, why would a private firm insist on guarantees that an enterprise wouldn't lose money if it was a good idea? If they thought it was a winner they'd be falling over themselves to sign on with no guarantees they wouldn't lose their shirt. They'd concentrate on getting better conditions or prices rather than the right to loot the treasury if it all went pear-shaped. Tell you what voters of New South Wales, elect me. I have experience blaming others for my mistakes, spending money I don't have for lacklustre results, pretending things are going fine and promising I'll change in the future, just like Iemma does. The difference is I'll work for much less than Iemma. Michael Price The Premier You Deserve! And not in a good way.

Wrong on Venezula

Usually the source of a news story tells you much about it’s credibility. The New York Times is not at all credible, Fox news not very, and most of the mainstream media not much better. This has little to do with “left” or “right” bias, Lewrockwell.com and Counterpunch.com are equally excellent. Unfortunately the latter has let us down with the defence of Chávez’s destruction of what little press freedom there is in Venezuela (The Case of Venezuela's RCTV By GEORGE CICCARIELLO-MAHER).

His first defence of the villiany in Venezulan video is the entire thing has nothing to do with free speech. Of course this does not lead to him denying that the non-renewal of a “concession” worth millions of dollars is due to the statements made on behalf of the owners of that concession. Indeed he goes claim that they “endorsed” “organized rebellion and premeditated murder”. Gee what horrible people, presumably the people who did this are under arrest for such things? And of course there would have to be a trial given the seriousness of these allegations? Of course not, they just got their TV station taken away. Well that is to say some of the people ciccariello-mahar accuses did, since he accused all the Venezulan media and only RCTV actually got the axe. Of course the other media owners don’t need to be expropriated, they got the message already and will no longer be endorsing anything but the government. Of course George Washington endorsed rebellion, as did Nelson Mandela and Winston Churchill are these all villians?

A series of “false” claims are trumpeted as the reason why people think that a government taking a TV station away from the legal owner and giving it to someone more pliable is an attack on free speech. Firstly of course it’s entirely false that the government is behaving abnormally. Just because you can’t remember the last time someone did anything like this who wasn’t a dictator siliencing his critics doesn’t mean that it’s abnormal. No it’s entirely normal, it happened at least once before*.

After all it’s all about “media responsibility”. Responsibility to their shareholders? Obviously not since they got ripped off. Their advertisers then? Again, no since they expressed no displeasure at RCTV and if they had they would not need the government’s help to punish them. How about their viewers? Again, no, they don’t seem at all upset with the station. No it’s the government that they are responsible to. And here was I thinking that the press were to keep the government responsible. The army is responsible to the government and the police as well, in a free society the media is not.

Of course “were this constitutional provision fully enforced and legislated, the private media might be able to claim that their existence is somehow more difficult than other media outlets the world over.” and in the case of RCTV they’d be right because he’s refering to a Bolivian constitutional provision which people in Caracus would be rightfully upset about being subject to. He refers to it in an attempt to persuade us that this is all normal, but of course immediately admits that it is not enforced. So having laws designed to be dictatorial on the books is pretty standard, but enforcing them isn’t, and Chavez isn’t just writting them. On the whole though I’d say that the existance of RCTV is more difficult than other media outlets the world over, because it’s now clearly at the whim of the government and no owner can count on investments in it unless assured the government won’t decide to give it the boot. Of course the owners aren’t the station, but they are by definition the ones that control it, that hire the workers, determine what goes on air etc. If they need to bend over for the govenrment so does the entire station.
But perhaps the new owners will be made of sterner stuff, maybe they’re the type to say “Hang the tens of millions of dollars in expense, we’ll tell the truth.”. So who are these new owners, because after all the ‘The government is "closing" a media outlet.’ is another one of those lies we’re being fed. The concession will be “granted to either another private corporation, a mixed public-private corporation, a collective of workers, or some other combination”. Well thank god, for a moment there I thought he’d be vague. The station will be run by either a) people who know that guys with guns can shut them down at any time, b) a combination of the above with the guys with guns that can shut them down, a collective or workers who are not at all connected with, beholden to, allied with or otherwise sympathetic to the guys with guns (they just happened to be passing outside the party room when someone threw out a license to print money) or d) someone else who knows which side his bread is buttered on.

But I’ve skipped ahead, like the ill-manner blogger I am, right over the justification Chavez was acting in accordance with high moral principals just like those of, wait for it, THE FCC! My god, a leftist is appealing for moral sanction from the putrid ethical sludge that slithered, decayed yet vibrant from what we will call the mind and soul of Herbert Hoover. Never mind that the FCC was designed solely for the purpose of controlling the airwaves for the monopoly benefit of the industry players and their corrupt lapdogs in Congress and the White House1. I mean for fuck’s sake pal read the manual, if you’re supporting Chavez you have to be a leftist, and if you’re a leftist you’re supposed to OPPOSE the backroom buggery by the bourgeoise and the beaurcrat of the consumer. It says it right here in “Partisan propaganda crap for dummies”, page 15, or were you too impatient to try out pages 1-14 to read that far? Of course appealing to the FCC for moral sanction has a few pitfalls, like it’s well known “content restrictions on broadcasting”, which are presumably different from censorship because the’re all about responsibility, they are “more strict, it should be mentioned, than in many European nations”. But perhaps I’m being unfair, after all the FCC did shut down a station in similar circumstances so perhaps the comparison is just. You see the owner was saying irresponsible things about how to cure cancer. The FCC acted entirely properly and in no way abused their massive powers to favour the politically powerful A.M.A., don’t listen to that Rothbard guy, he’s got a “conspiratorial veiw of history”.

The FCC licenses and the Chavez government “concessions”, but they are effectively the same thing, which according to incurious George are "the juridical means by which the administration cedes to a person the privative use of something in the public domain, or the management of a public service, for a determinate period of time and under certain conditions.". And what is it that is allegedly in the “public domain,” or consists of “the management of a public service”. Well I happen to have a copy of the TV license here “Youse guys can play send out your telley shows on frequency and we won’t kill you for doing it. Unless we got a really good reason or something.”. So that’s what RCTV has that is “in the public domain” a (nonenforcable) promise that if they do something the government break their heads, nothing more. Those who claim that RCTV owes something to somebody because they’re using a frequency should ask themselves “Who died and left that frequency to the govenrment?”. The government no more holds the spectrum just because it’s got guns than it has freehold on all land it hasn’t sold to some sucker. RCTV was there first and has every right to broadcast without interference as long as they are not interfering with anyone else’s broadcasts. It could only considered “use of a public good” if spectrum wasn’t excludable and rivalrous, which it is and has been since at least April, 1926 and the United States v. Zenith Radio Corp. That case said “first come first served” applying the same rule that applies to land and natural resources in every just land. In any case it can hardly be argued that the government can play around with RCTV because it’s “concession” is so valuable since the only reason it is that valuable is that the Venezulan government has so restricted the media market for the benefit of the oligopolies. Somehow the idea of hurting said oligopolies by actually abandoning the “concession” system and allowing free competition occurs to neither left or right.

Of course the whole “concession” system has been abused for centuries to monopolise things that ar ein no way either “in the public domain” or “management of a public serivce”. There is no real reason why oil is “the public domain” any more than any other resource is, to give an example Ciccariello-maher references. The granting of oil concessions on the basis of government favouritism as opposed to homesteading of well has led to enormous money earners being “traditionally and undemocratically granted to large corporations which have been given free rein to reap unlimited profits” in corrupt deals that encourages the coups, stagnation and violence that have plagued oil rich countries the world over. Of course you might ask what oil concessions, which concern something that run out, have to do with using a fequency which won’t. I don’t know either but somehow they’re all the same according to George. Basically George wants to end “the disgusting privileges of a communications oligarchy allied with international financiers.", or at least the disgusting privileges of that part of the oligarchy that pissed off the all powerful God-President.

That’s ok though because “What could be more democratic than handing Channel 2 over to the 63 percent of Venezuelans who voted for Chávez?”. Well handing over all the channels in America to Ronald Reagan in the 80s, and Margret Thatcher could grab ITV and Thames in merrie old England. Or Mr. Howard could... could... could fucking die if even tries it. I serious John any move to grab TV stations like Chavez did and you’re fucking history. I know where you live. Well so does everyone but still, I know. I mean Jesus H. Christ who is stupid enough to think that giving TV stations as electoral prizes is a good idea? This guy got a degree? All I got out of my cereal packet was a fucking plastic spaceman, no fair.

Here’s an idea what could be more democratic than handing over Channel 2 over to the 63% who voted for Chavez, how about you just ditch the idea that the government owns the airwaves for good? Any joe blow can just start broadcasting whatever he wants provided it doesn’t block an existing signal. That’s pluralism, that’s freedom, that’s “democracy” in the sense of a free society that freely selects it’s leaders by freely examining the issues and openly debating them. What George suggests is “democracy” in the sense of 51% can kill 49% because they say so.
I don’t understand why this crap got on conterpunch.com. Surely they’re leftists but they’re not normally idiots. Just because someone resists the West in general and the US in particular doesn’t make them a saint (you might remember a recently deceased arab who died well, if not soon enough).

The constitution is not a suicide pact, is it?

The idea that the constitution should not be kept to at the cost of the destruction is a popular one. Is it right?

Thomas Sowell is the latest eminent person to insist that the 'The constitution is not a suicide pact.' and as usual the insistence is made to defend encroaching tyranny. There is good reason to believe that adhering the the constitution is not as suicidal as it's detractors imply. Indeed the main dangers to America come from it's violation and I believe that a similar pattern will be evident in all states with a constitution. However let us assume that it is true that survival and obedience to the constitution are incompossible, what then? Let's consider several definitions of 'survival' relevant to the question.

The first definition is 'political survival' or 'national survival' that is to say the survival of the particular State without regard to the survival of the people under it. Clearly if all people under a State die so does the State, but a State can die without a single one of it's people perishing. The death of a State means that the monopoly of force either dies or is exercised over a different geographical area. There is nothing inherently bad about this. Sentimental attachments aside plenty of people live in States that either did not exist when they first moved there or did not rule the territory they live in. While it is true that the new State may be worse it may also be better, I know of no real evidence that changing soveriegnties makes you worse off on average. Indeed if that were the case then where did the better States that people were living in prior to such changes come from?

It clearly states in the Declaration of Independence that 'That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed.'. Note that this is the sole reason that governments are instituted, there is no other. If a government does not achieve these goals then it is obselete and must be discarded. Certainly many prefer that the laws not change and changing soveriegnties does that, but so does ignoring the constitution. The consitution is the law, and nullifying it is an immense legal change, affecting all other laws. All judges and politicians swear to protect the constituion. They do not swear to protect the State. Now you might think that what they swear to doesn't matter, and the Bush1 administration seems to agree. This doesn't make the State any safer however, the danger of being managed by oathbreakers is far greater than the danger of being bound to the constitution. If you doubt this consider how few people were lynched because blacks could vote as opposed to how many were lynched because they had been disarmed. Consider how many were killed in the USSR, Nazi Germany or even South Africa because of violations by government of people's rights and how few killed because they were enforced.

Secondly 'survival' might mean the physical survival of some number of it's citizens. The idea that the constitution should be put above the survival of a small number of it's citizens is frankly treasonous. If it were true then an attempt to invade the country would have to be met with total surrender. After all if your life is worth abandoning the legal system then so is the life of soldiers and therefore the imposition of a foreign legal code should not be resisted by their deaths. Now you might ask 'What if all the people might be killed if the constitution is not abandoned?', well if there is such a danger (and so far there has never been such a danger that could be prevent by unconstitutional action) people may avoid it simply by emigration. If you donÕt want to live in a country were your life can be sacrificed to freedom then go somewhere where that won't happen. This will not probably make you safer as I have previously stated.
Thirdly 'survival' might mean the survival of the consitution itself, however violating the constitution to prevent it's violation makes no sense. It would be like killing your child to ensure they don't get harmed. If it is possible to violate the constitution any time it is in 'danger' then the constitution is never safe and it's provisions are no longer the highest law of the land, that is to say it is no longer the constitution and has practically died.

So under all the definitions of 'survival' that apply none qualify as worth killing the constitution for. The constitution is not a suicide pact but, flawed as it is, it is something worth the death of a man, or a State for.



1 And to be fair the Clinton administration and most others as well.

A threat to our most sacred freedoms!

Stop reading about the trivial threat "control orders" have to our liberty, forget about the fact that the US can lock up anyone it wants, whereever they find them, for as long as they want without trial. No the real threat to our sacred freedoms has been revealed, THE RIGHT TO FREE SPORT IS UNDER THREAT! That's right soon if you want to view something on TV like the rugby league final, the olympics, events requiring the intense effort of many talented and dedicated people, the organisational skills of others and the capital of still others to transmit you may actually have to PAY said people. The NERVE! Imagine asking people to pay for something just because it cost effort and capital to produce and people want it. Next they'll be asking us to pay for our food, electricity and transport. I mean don't they realise that we're "we the people" and can demand anything we want from anybody for whatever price (including nothing) we want? Don't they realise that there are no possesions that aren't ours if we want them. Don't they realise that the rights of producers as far as we're concerned are just the same as the rights of medieval serfs with regard to their masters? Why are they not bowing before us and making appologies for even suggesting that payment might be required? Let our servants in Canberra go forth and beat them about the head with the speakers make.

Dick Meyer commenting on the Great Fluid Ban says "... I am mystified by our tolerance for the incompetent, politicized and inefficient charade that is now masquerading as transportation security. Apparently the illusion of security is enough."

Well yeah, Dick, where have you been? The terrorism risk aboard an airplane, even in the "post 9/11 world" is probably less than the chance of having a heart attack from the sheer stress of airline stupidity so actual security is not all that valuable. On the other hand the Great Unwashed have been assured that there is a danger. They don't like to think of a danger they and their protectors can't do anything about. The fact that such a danger is trivial is not the point, it's the degree of control the public have. By inflicting various inconveniences and annoyances on the public the government demonstrates that it is capable of doing someone*. Thus they establish a degree of control and through them the public feel a degree of control. This is what they were after, not genuine security, which in practice they already have to a great extent.

He also opines: "Are we to imagine there aren’t great minds at Homeland Security who spend their time thinking of all the possible ways evil-doers could blow up planes? Of course there are. Are we to imagine they never thought about making bombs with stuff in spray cans? Sure they did. And they surely made rational, practical assessments of the risk."

I don't know why he thinks this. In the wake of 9/11 Condeleesa Rice claimed that nobody foresaw that planes could be used as weapons. However they had. In fact it was the subject of a roleplaying game scenario "Fly to heaven" http://www.rpg.net/news+reviews/reviews/rev_2156.html. So the entire Pentagon could not anticipate an event but 4 guys with a few word processors (which is what Atlas games is really) could. I find it extremely unlikely the security forces have any group tasked with imagining ways the terrorists might strike. They tried something like that with "Seal Team Six" and they embarrassed the high command so much they were disbanded. A contingency planning team can only cause problems for the security services and armed forces forcing to acknowledge the inevitable gaps in security, far to numerous to all plug. The last thing they need is for someone to remove their excuse of ignorance.

* I just noticed that I wrote "someone", where I meant to write "something" but perhaps it's a freudian slip.

Internal matters, good for me but not for thee.

The Indonesian government has recently got all upset over John Howard expressing "concern and distress" over Abu Bakir Bashir's release. They say it's an "internal matter" when someone who promoted the murder of Australians is released after only two years. Where was all this concern over internal matters when they protested about the 42 Papuans being granted asylum? The decision to grant asylum is a finding of fact by Australian government officials and is not and cannot legally be subject to Australia's foreign policy. Constitutionally under the doctrine of "Seperation of Powers" John Howard had no more right to change the determination of the proper tribunerals and courts than he has to have the courts find someone guilty they acquited. The response to Indonesia's arrogant and insulting actions was to kowtow and change policy to make asylum seekers, both legitimate and not, more miserable for longer at a cost of millions to the Australian taxpayer. Needless to say the Indonesians were not so accommodating when our government commented on their system.

In a facile and stupid article in the SMH Gerald Henderson took aim at those that support West Papuan independence. Yes, Gerald it is racist to oppose the breakup of the Indonesian state, considering how much people supported the breakup of the Yugoslavian state for far less oppressive actions. If the West Papuans were white you would have no problem with their independence. Mr. Henderson claims that the asylum seekers "engaging in public debate" is counterproductive? Why? Because "to imply that this policy [of the ALP and the coalition not supporting independence] will change is misleading]. The problem is that nobody implied that. The Papuans simply talked about the bad things the Indonesian government is doing and why independence is a good thing, not surprising behaviour from seccessionists. It got him talking about Papua and civil rights violations there, so at least it's raising awareness.

On the subject of rights violations Mr. Henderson was disingenous saying "The extent of human rights violations in Papua is a matter of contention.". No doubt it is, but then so is whether the holocaust happened*. The only evidence he presents is a statement by someone on Lateline that there is no contemporary evidence [note, contemporary, so presumably there is historical evidence for this] that Indonesian special forces or inteliigence are systemactically going after Papuan independence activists for assasination. This is pretty weak tea. All it says is that a particular type of abuse isn't happening right now to a particular type of people in a particular way (systematically) by two particular groups. The actions of Indonesian backed militias are removed from the equation as are non-"systematic" murders or murders of non-activists. Nobody would write this unless they had nothing better to write in defence of the indefensible. It was perhaps the most hypocritical thing I've read in the Herald. To describe the proposed changes in asylum seeker policy as "reform" is the final insulting icing on a putrid cake.



* It did.

Government shoots self in foot, soldier didn't shoot himself anywhere.

Well they're still trying to figure out how poor private Kovco got a bullet in his head. The official story version 4 is "we don't know". That would be fine if it had been official story version 1, nobody expects instant omniscence from our fearless leaders. Instead we got "it went off while he was cleaning it", an unlikely story given Kovco was a qualified sniper, which indicates both high intelligence and respect for weapons. I initially suspected suicide for that very reason, but it turns out there were no powder burns on the body,<1> meaning it was fired from at least 4 foot away. So story number one was rubbish, and anyone who had any information about the events should have known it, particularly highly qualified officers.

Then there was official story number 2 that he had moved the gun and somehow it went off. Again this is contradicted by the powder residue evidence.

Then there was official statement number 3 that he had somehow dropped his laptop computer on to it and it had discharged. This was perhaps the weakest explanation. For a start how does a laptop falling onto a properly designed and maintained pistol, in it's holster cause it to go off? Simply having the corner of it wedge between the trigger and trigger guard won't do, there has to be pressure on the back of the butt. This safety feature prevents discharge if nobody is actually holding the pistol to shoot. Then there's the question of how the bullet ends up in his temple if it came from underneath. Finally this version as all the other versions before it did, contradicts the powder burn evidence or rather lack thereof.

Now this is more than just guessing 3 times and getting it wrong, as callous as that is to Shelly, Tyrie and Alana Kovco. The government knew all along that there were two people in the room when it happened and either of them could have told them none of these versions were true. So what's going on? Guns just don't go off. Particularly not guns bought by one of the most professional militaries in the world and maintained by a qualified sniper. The government gave information that it ought to have known was bad at least 3 times. Either the military is consistently handing them rumours instead of confirmed fact or the government is trying to spin something. But what? Were the other two soldiers in the room "skylarking" with Kovco's gun? If so what efforts were made to investigate what they were doing? A simple GunShot Residue should confirm or disprove their firing the gun. If this test was done what are the results? If not why was this simple investigative step not taken. I can think of no reason why you would not test someone in the room of a suspicious gunshot death for GSR. Not doing so is arguably deriliction of duty. Perhaps that's the extent of the spin, simply covering up for shoddy investigation. I hope so, but knowning the Howard government we won't get the truth until we drag it kicking and screaming into the light, presumerably after next election.

Oh yeah and they've lost the bullet. That should be a firing offense all by itself but don't hold your breathe.

<1> In fact this was an error, apparently there were such burns when the coroner examined the body, or at least burns "consistent" with powder burns. There just wasn't any powder. So either the powder was washed off, as apparently happened or something weird is going on. Of course this means even more evidence was compromised than previously suspected.

Another Whacking Bribe.

For those of you that are either not Australian or have been living under a rock, the Australian Wheat Board has been caught giving backhanders to Saddam's cronies. This happened back when it was worth being Saddam's crony in 2000 and the Australia government only recently found out about it. Well that's their story anyway, and by GOD they are sticking to it. I don't know which I'd prefer, having a government so corrupt it would turn a blind eye to kickbacks that funded weapons aimed at it's troops or one so stupid it didn't know that the trucking deal was corrupt. I mean requiring vendors to use a particular firm for transportation, storage etc. and getting a backhander from your friend who owns it, surely that's the oldest trick in the book? I mean the Babylonian government has been using that one since before the Code of Hammurabi.

You might remember than "Honest John" Howard backed the invasion with all his might, all the way with LBJ-style. I can't think of a good ryhme for GWB, so all you frustrated lefty lyricists start working on it. Well after the invasion the Yanks started looking into the oil-for-food thing, hoping to find corruption. In somewhere other than Halliburton I mean. Now at this point you have to wonder, what the hell was Johnny thinking? I mean he was warned 6 years before by the Canadians that the deal stunk, and we know that he believed them because he didn't try to find out if it was true. Mr. Howard has become rather good at not knowing things that his senior civil servants knew and thus not being blamed for it. So why didn't he have a quiet word with George and Dick and the gang, over a barbeque (not a hunting trip as he is very anti-gun) and tell them to call off the dogs a bit? I mean what's the point of having friends in high places if you can't give the nod to the investigating officer? I mean is this man an Australian at all? He's a disgrace to the traditions of the New South Wales colony.

Instead John actually starts an inquiry into what happened. Lord, love us and save us we know what happened. Saddam wanted wheat, the farmers (a powerful lobby but not much subsidised down under) wanted to sell him wheat through the "single desk" wheat monopoly and Saddam wanted a kickback for doing it. Blind freddy could have told you what happened, why start a bloody inquiry? I mean asking questions is fine for fun, in university halls, and internet chatrooms but it shouldn't be mixed with politics. If it is it can only lead to answers, and who wants that? One government spokesman said that the AWB had looked after the interests of Australian farmers well. Well yeah, that's the point, a little too well. The whole thing is so stressful that many of the AWB officers like Trevor Fluge, the Chairman and the Middle East Manager Mark Emons are suffering amnesia. This serious condition can affect their ability to earn income for years. I just hope they get a good golden handshake to make up for it.

So anyway the AWB looks like it might have to disolve, or not, it seems to change each week. The Iraqis are refusing to deal with them because they were once bent. Apparently being muslim Challabi, Allawi and Sistani haven't heard the story about throwing the first stone. I mean pot calling kettle, come in kettle.

In the meantime Kim Beazely, who was narrowly avoiding arrest for impersonating an opposition leader is doing well complaining about someone doing exactly what he would have done at the time. It's sorta like the Democrats complaining about the NSA phone-tapping. You know they should but you can't imagine they're doing it honestly.
I mean after forcing the telcos to install stuff that let the government tap half a percent of all phone calls at once what did they think it would be used for? Oh well it's all part of life's rich tapestry.


Alternate meanings of AWB;
Amnesiacs With Booty.
Always With Bucks.
Australia's Wonderful Briefcases.

Leaving the Iraqis high and dry.

Jeremy Sapienza responded* to a claim on tomgpalmer.com** by Greg that "the rest of us grapple with the serious issues about how to ... bring the troops home without leaving the Iraqis high and dry," with the claim that " 'leaving the iraqis high and dry' is so obviously the absolute best possible thing that could happen to Iraqis since they got the electric lightbulb". Neither of these claims can be taken seriously. The issue of how to bring the troops home without leaving the Iraqis high and dry is not serious. It will not be serious until someone figures out a way to keep the troops there without leaving the Iraqis high and dry. That is a subject that Greg would "grapple" with if he really thought about not leaving the Iraqis high and dry, which he doesn't. So far no hawk "libertarian" or otherwise has figured out how to do it. The Iraqis are stratospheric and absolutely dessicated now, and sorry Jeremy but it's far from the "best thing since ... the electric lightbulb".

Let's start by defining our terms. "High and dry" means without protection from vicious Jihadis, sociopathically ambitions powermongers, nationalist terrorists, criminals, personal enemies, random pyschos, foriegn agents provocateurs, government death squads and last and probably least mistaken revenge attacks. At the moment outside the Green Zone Iraqis don't get that from the US government or it's Iraqi puppet. If someone wants to kill you they basically can unless you have connections to a private militia and even then it's no "cakewalk". Every day we hear of civilians being killed, far less often we hear of their killers being called to account. When was the last time someone who murdered for political or religious reasons was actually charged in Iraq? Convicted? Or even just summarily executed?

So how did this happen? How did a country with over 1 fully armed, highly trained, relatively competently led***, soldier for every 140 people manage to be totally without effective armed protection? Especially considering that they have what 50 Iraqi regiments backing them up? Well here's the thing, the occupation forces aren't there to protect the Iraqis but to protect the Iraqi government. If the form and content of the Iraqi State can't change without Washington's say so they have succeeded, if they can it has failed. Violent deaths of civilians have nothing to do with their objectives and indeed sometimes favour them. The troops simply have no reason to prevent violence, other than against themselves or other servants of the masters. Protecting those that are useful to the occupation however is top priority, even when they are ruthless killers who brutalise other groups, for example the Shia "Wolf Brigade" or the Kurdish peshmerga. These groups have local knowledge and advantages that the occupationm sorely needs and so cannot be alienatied just becaues they did a few murders, most of which they would argue serve coalition purposes. Like a 1960s sheriff's department in the deep south did not provide protection to their black citizens but to their oppressors the occupation forces protect those who violate Iraqi rights from those they target. Of course only those percieved to be useful to the occupation get protection from the just wrath of their victims but this policy also benefits the regimes enemies.

Without knowing who is responsible for a given attack victims and their relatives cannot effectively investigate it by themselves. To do so would invite further attacks if the offenders turned out to be working with the coalition or had more influence with them than the victims. If the offenders have such a relationship or influence any questions may lead to a dank cell in one the many Iraqi government torture centres. Government investigations are also difficult because nobody trusts the coalition forces or their puppet police. Many people feel that cooperation with the "legitimate" authorities is betraying the cause of the resistence, and to an extent they're right. If the "legitimate" authorities delivered protection they would be secure and would probably never leave. Any information will also be used to try to track down insurgents that may have the informers sympathy. In addition it is well known that various violent groups have infiltrated both the police and the army and so giving information may not be safe.

It should be noted also that violence is being rewarded even if it is directed at coalition troops. Muqtada al-Sadr raised an army against the occupation that could only be defeated by destroying large parts of Bagdad. The US baulked at that (despite having already done similar things several times) and allowed him to gain a political role. He is now in the Iraqi parliment and being consulted on everything from the new constitution to who should be in the Iraqi army. My bet is he thinks his boys should be. He has ensured his own political relevance, a cushy job and the ability to distribute patronage all by simply killing a few foreign infidels. He didn't even have to murder them since he acted in legitimate defence of his rights. Later we heard denials (from both sides) that the US was negotiating with the insurgents. Predictably these denials were false. The US was negotiating with Sunnis for their support and needed most of the Sunni insurgency on side for it to work. So again the process goes, shoot Americans, destablise regime, wait the regime to negotiate, walk off with big cash and prizes. This is hardly the sort of thing that will discourage violence.

In the absence of foreign troops of course much violence will continue, but one thing will change. Thugs will have to both protect themselves and pay their own way. There will be no US funds to relieve them of their day job or foreign arms to protect them from retaliation. The "Wolf Brigade" will have to either stop killing people or protect themselves from their relatives, without picking up the phone to Big Red One. History suggests when the violent have to pay for their own violence, they buy less of it. If you really don't want to leave the civilians high and dry, get the troops out.

*http://anti-state.com/blog/2005/11/12/i-believe-in-peace-bitch/
** http://www.tomgpalmer.com/archives/026869.php
*** While the top leadership is amazingly incompetent the lieutenants, captains
etc. are better than those of most armies.