New Light on a Great Libertarian

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One day in September 2011, I received the following email:

“I’ve just ordered your book on Garet Garrett, brother to my grandmother, Gertrude Garrett Graham, and my great uncle. There are a few anecdotes from his later years of retirement in Tuckahoe NJ and his relationships with his family and I’d enjoy talking with you, once I’ve read your book.”

It was signed, “Trudy Beth Bond.”

Garet Garrett (1878–1954) author of The Driver, The People’s Pottage, and The American Story, was one of the great libertarian journalists of the 20th century. I wrote a book about him, Unsanctioned Voice, published in 2008.

The book is more about Garrett as a writer than as a person and necessarily so. Most of his papers were lost. He had no children. His third wife, Dorothy Williams Garrett, had a son from a previous marriage, and he also had died, but I found his daughter. She had a few photos of Garrett but was too young to have known him.

Digging for details more than half a century after he died, I found one person who had known him: Richard Cornuelle, who had worked with Garrett in the early 1950s (and who died on April 26, 2011). Cornuelle had gone on to become an official at the National Association of Manufacturers — and had written a book, Reclaiming the American Dream, championing the nonprofit sector as an alternative to the welfare state. In 2007 I flew to New York City to meet him at his Greenwich Village townhouse and hear of his time with Garrett. Cornuelle, then 80, was delighted that someone wanted to know about the man who had been his mentor.

My book was more about Garrett as a writer than as a person and necessarily so. Most of his papers were lost.

Cornuelle gave me some personal details about Garrett, some of them incomplete. He told me one of Garrett’s sisters lived in a farmhouse on Garrett’s property at Tuckahoe. But which sister? Why was she there? What role had Garrett played in her family? He didn’t know. My book wasn’t mostly about things like that, but more personal details would have improved it.

After the book came out, I wondered whether I would hear from some lost relative. Three years went by. Then came the email from his grandniece, Trudy, who lives in the very town, Port Townsend WA, in which Liberty was founded and published for more than 20 years — a town about two hours’ drive and a ferry ride from my house.

Trudy was born in 1941. Through her, I got to talk to her brother Marshall, born 1943, and her sister Connie, born 1945. They knew Garrett as kids, aged 9 to 13. They were also part of a family that would have some stories about him. They might fill in some of the blanks in my account.

I had known that Garrett and his third wife, Dorothy, lived somewhere along the Tuckahoe River in New Jersey. From Connie, I received a satellite photo of the property.

At the beginning of the book I had listed Garrett’s siblings from Census records: Gertrude, Mary, Sarah, Thomas, and “what looks like ‘Clarra.’” But I knew nothing about them. Now I had their full names — it was “Clara” — and the dates of their births. I noticed that all but two of Garrett’s siblings were born in different towns, most of them not far from Garrett’s birthplace at Pana, in central Illinois. Garrett’s father Silas was a tinker — an itinerant tinsmith — and his family moved around.

From my new acquaintances, I heard one story of the children’s youth. Garret’s father, Silas, was a Protestant. What denomination was never said, though his funeral was in a Methodist church. According to Marshall, Garet’s mother, Alice, was a devout Catholic.

“They had made a pact when they married that their children would be allowed to make up their own minds,” Marshall said. “But the priest prevailed on Alice, and she did certain things behind her husband’s back, such as putting them in catechism class.” The effort backfired, and Clara, Gertrude, and Marie embraced the new religion of the time, Christian Science.

Then came an email from the very town, Port Townsend WA, in which Liberty was founded and published for more than 20 years.

“The Christian Science thing was a big schism in the family,” said Trudy, who was raised in that faith but abandoned it. She heard the story through her grandmother, Gertrude, who was zealous enough to become a Christian Science practitioner. Garrett was not a follower of Christian Science, and Trudy says his religious sisters disapproved of his drinking, smoking, and being married three times. But Gertrude and Marie also respected his achievement. They called him “Brother,” as if it were his name.

I learned little about Clara, who had stayed in Illinois. Sarah, whom they called Sadie, married a veterinarian and lived in Missouri and Iowa.

“I met my Aunt Sadie when I was 10,” Trudy said. “She seemed to have escaped the whole religion thing.”

Garrett’s younger brother Thomas had been an artist, and Connie has a painting of his (“landscape on the front, female nude on the back”). Thomas died young, in 1917, of somedisease. He is buried in the same cemetery as Garet and Dorothy Garrett, in Tuckahoe, which suggests that his elder brother had taken care of him — and perhaps had removed his remains, because Garrett didn’t move from Egg Harbor, NJ, to Tuckahoe until the mid-1920s.

The sister living on Garrett’s property was Marie. Trudy recalled the story that Marie had been living in Chicago. She was a man’s secretary for many years, and had become his mistress. “Supposedly his wife was sickly and when she died, he said, he would marry Marie, but he did not.”

His religious sisters disapproved of his drinking, smoking, and being married three times. But they also respected his achievement.

Trudy’s sister Connie writes: “As mother told me, Marie fell in love with a successful lawyer in Chicago. He was married and his wife was in a mental institution, and he told Marie there was some law that prevented a spouse from divorcing a spouse who is in an institution. So Marie consented to stay with him (my impression was that he paid for her apartment), something she otherwise would never have done.” Connie visited her Aunt Marie there, and recalls “Uncle Walter” stopping by with candy for the kids.

When the man’s wife died, he wouldn't marry Marie. Connie continues: “Humiliated, Marie went east to Garet’s, where she stayed on, and where Joe French, Garet’s tenant farmer, fell for her and asked her to marry him.”

French was not an educated or worldly man. His claim to fame was playing baseball in the minor leagues in San Francisco, Topeka, Sioux City, Dubuque, Peoria, and Beaumont in the years before World War I. Trudy recalls that his fingers had been broken from playing catcher.

As Connie recalls the story, Marie went to Garet and asked his advice, telling him, “Imagine. That man is no more than a tenant farmer and he wants to marry me!” To which Garet replied, “At least he wants to make an honest woman out of you.” Trudy says that Marie married French “under duress from Garrett, who didn’t want to support Marie for the rest of his life.”

In none of Garrett’s writings does he talk about taking care of his family, or the stress of an obligation to do so. Garrett left his family in Iowa in his mid-teens. Several of the characters in his fiction are without family, and none of his fiction or his vast amount of journalism focuses on family issues or champions family loyalty. He addresses other things. Yet he takes care of his sister when the gamble of her life fails. He nudges her into a marriage with a man who loves her, and he provides them both with a house.

It is what honorable people do, if they can, when there is no welfare state.

Trudy, Marshall, and Connie recall Garrett as the success, the urban sophisticate, of the family — and, of course, much older than they. As preteens and early teens, they moved with their parents from suburban Chicago to New York City in 1953. She believes they were the only relatives of her generation who lived close enough to visit Garrett, and the only ones today who remember him.

In none of Garrett’s writings does he talk about taking care of his family, or the stress of an obligation to do so.

From the summer of 1953 to Garrett’s death in late 1954, they visited Tuckahoe often, staying at Marie and Joe’s, in the farmhouse on Garrett’s property. This other building was not a farmhouse really. It was a three-story brick house, covered with ivy. It had a ship’s binnacle on the porch, and Connie remembers it as “the captain’s house.” The place was the subject of a feature story in the Atlantic City Press. (Trudy has the clipping.) Part of the Stille Homestead, the house had been built in 1795 “by slaves,” the newspaper said, using “bricks brought from England.” It had thick walls and five fireplaces, two of them in the basement, “where in the cold winter time the first families cooked, ate and kept warm.” Upstairs it had a “borning room” where mothers gave birth, and outside was a small graveyard.

One of the side buildings had been made into a glassblowing studio for Garrett’s wife, Dorothy. Connie has a small bottle that Dorothy created, with a dime in it.

Trudy turned 13 in 1954. Of the captain’s house she remembers “a wonderful attic where I spent many, many hours reading old Saturday Evening Posts” that Garrett had kept in bundles. His articles were mostly above her head, but she saw his name on them in the Post. “It wasn’t really until then that I knew what Uncle Garrett did.”

Garet and his wife lived several hundred yards from the old house in a new house he had built. “Garet and Dorothy's house was enchanting to me,” Connie recalls. “It had the biggest fireplace I had ever seen and I remember very well the bust of Nefertiti that you mention in your book, as well as the high bookshelves that flanked the fireplace.”

Trudy remembers Garrett’s room with the two-story ceiling and the big fireplace. “The room had a cozy feel to it, almost like you would feel in a log home. Garrett was the boss of that room. Really he was the boss of the whole place. Dorothy was pretty much in her cups all the time.”

I had mentioned Dorothy’s alcoholism in the book, and all three of Gertrude’s descendants remembered it. They remembered Garrett drinking, too, but not being drunk.

They also remembered the outbuilding Garrett called his “cave,” where he wrote. “He built that,” Marshall recalled. “He was proud of that. He had a little storage area underground where he kept his ink cool. He had these big bottles of Scripps ink. Four of them. He’d refill the well on his desk.”

I had quoted Richard Cornuelle in the book about how Garrett would research a topic, keeping everything in his head, “muttering and fuming quietly. Then, suddenly, he would seize an old-fashioned pen holder, jam a new point into it, and scrawl on white foolscap, often for hours, panting and sweating, jabbing the pen in the ink now and then, until he had it all down.”

Scripps ink, from big bottles.

I had said in the book that Garrett sometimes hid in his “cave” from kids, and Connie, who turned 9 in Garrett’s last year, recalls:

“Although we did often go over to Garet and Dorothy's house, and I did catch my first fish off their dock, and Garet helped me unhook it, on the whole not too much happened of a family gathering nature when we were over there. We kids generally weren't allowed in his little building where he did his writing, but sometimes we were sent out there to fetch him or take him a snack, and I would look around in awe at all the books and papers around him.”

Trudy and Marshall remember Garrett showing them his artesian well, and how he had piped the water into his house. Garrett did his own plumbing.

In Unsanctioned Voice, I quote Cornuelle saying that Garrett had buckets of silver dollars under his porch as insurance against a feared inflation. (If he had lived another 20 years, they would have paid off.) Trudy and Marshall remember the stories of buried coins, either silver or gold. Marshall recalls that silver coins were found inside the ship’s binnacle, under a layer of sand.

When Garrett died, his property went to Dorothy. She died six months or so later, willing the property to her son, James. That was a setback for Marie and Joe, because they had to move out of the captain’s house into town.

Perhaps Garrett had an influence on the family. Connie was the closest to Garrett in her career: she became a writer and editor of Smithsonian magazine. Marshall is the closest to Garrett in his philosophy.

“I don’t think anybody knew about libertarianism then, if they called it that,” he says. “Most of us are still quite conservative, maybe not to the extent of libertarianism, but pretty near.”

“When I read about the attitudes of Garet Garrett, I see my brother,” Trudy says.

Trudy was an attorney, teaching classes in how non-attorneys could file papers and defend their rights. She recalls once going out with a man who admired Ayn Rand, and telling him, “I am the grandniece of Garet Garrett.”




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Mittimal Damage

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After being badgered incessantly by Gingrich, Perry, and Santorum, “vulture capitalist” Romney finally released his tax filings. We finally got to see what dirt was being covered up in his returns.

And the dirt was — nothing!

The press sifted through the 500 plus pages of Romney’s 2010 filing (and his projected filing for 2011), desperately looking for something to hit him with, and Romney came out totally clean. The media mission was to find new material that their guy Obama could use to bash Romney, but the mission was an abject failure.

True, the released material shows Romney to be a very rich man. But the filings only confirm what anybody could have found by Google-searching the dude and reading his Wiki entry, to wit, that he is worth around a quarter of a billion bucks. Listen, don’t get me wrong: I would love to have that kind of scratch. But it doesn’t put the man on the Forbes 400 Richest Americans list — he’s nowhere as wealthy as such media-darling leftist billionaires as Warren Buffett and George Soros.

Progressives are cheap when it comes to spending their own money to help others. They are generous only with other people’s money.

To be precise, in 2010 Romney earned $21.7 million, of which $12.6 million was capital gains, $3.3 million taxable interest, $4.9 million dividend income, and the remaining million or so money coming from various business gains, refunds, and speaking fees. Romney gave a whopping $3 million to charity — about 14% of his income.

Taxes on cap gains, dividends, and interest rates are a flat 15%, and charitable donations are quite legally deductible — which explains why he “only” paid about $3 million in taxes (about a 14% effective tax rate).

In short, he legitimately minimized his taxes, and paid no more than he was legally required to. This puts him in the same boat as the rest of us, Obama and Biden (and Buffett and Soros) included. I confess that I try to minimize my taxes legally. I never — repeat, never — pay more than the law requires, and I have nowhere near Romney’s tax burden.

The mainstream media was reduced to nitpicking. It turns out, for example, that Romney — whose portfolio is in a blind trust, please note, so invests without his knowledge or control — had small investments in Swiss and Cayman Island accounts. All quite legal if declared to the government — and it was.

Of his generous charitable giving, half of it went to the Mormon church, and the rest to a variety of charities, including one for researching MS (an ailment that afflicts his wife).

His projected 2011 filing, which he has promised to release in April when it is filed, shows similar income, charitable outlays, and tax rate.

There is no doubt that Obama will use as much of this as he can to hammer Romney in the fall, assuming that Romney is the Republican nominee, which I regard as virtually certain. But there is little ammo here.

Indeed, Romney’s lavish charitable giving actually underscores Obama’s cheapness when it comes to charitable giving. Compare the nearly 14% of his income ($3,000,000) that Romney gave, to what the Obamas did: from 2000 through 2004, they gave about 1% to charity (or less than $11,000), and in 2007 they gave 5.7% (or about $240,000). Even more tight-fisted was VP Joe Biden, who averaged a pathetic 0.3% (a truly risible $349) in annual charitable giving in the decade before he became vice president, and not much more since. Last year, Biden gave 1.4% ($5,300) to charity. Truly nothing compared to Romney.

The national average for giving is about 5%.

This illustrates the thesis of Arthur Brook’s estimable Who Really Cares?, a book I reviewed for these pages some time back (March 2009, 43–6): the progressives are cheap when it comes to spending their own money to help others. They are generous only with other people’s money.

Even the 14% tax rate that Romney enjoys is hard to use against him. Remember, the John Kerry household paid 13%, and the Democrats had no problem voting for him as their nominee. And for Obama to push the capital gains and dividend rates back up is for him to risk a major downturn on the stock market, as well as in the lavish support he is getting from his billionaire buddies. That could cost him the election.

In the end, after relentless attacks by Gingrich, Perry, and Santorum, all that has been revealed about Romney is that he legally and ethically earned a large amount of money, paid his taxes, and is a devout member of his church. In short, what is known now is what everybody knew all along.

Given that Obama has few accomplishments he can run on, we can also expect from him what we knew all along. His likely $2 billion reelection campaign (the $1 billion his campaign will have to spend, and the $1 billion that will be spent by groups that support him) will be entirely negative. And it will be as repetitive as it will be negative. It will simply repeat that Romney is rich, rich, rich! And he is white, white, white! And he is Mormon, Mormon, Mormon!

I am weary already.




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Do the Republicans Deserve to Lose?

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Liberty readers presumably want to defeat President Obama and the Democrats. Apart from his beliefs, policies, and associates, Obama is a decent man. His challenger, to have a chance of winning, should be one also. Moreover, he should not have so much in his background requiring excuses and apologies — no matter how valid — as to preempt the voters’ limited attention from policy issues.

No one has a right to the nomination, or to complain about unfairness if he doesn’t get it. Electability is a reasonable requirement even for the most decent person.

Gingrich’s excuses and apologies are not even good ones, in my view, even though they may work in campaigning. His undistinguished record at West Georgia College, his questionable ethics and other reasons for being forced out of the speakership and even out of Congress, his half-truths, his “grandiosity” (so identified by Rick Santorum), and his marital infidelities all testify to his character. His claim to have changed his character and to have received or at least to have asked for God’s forgiveness strikes me as disgusting hypocrisy.

In a column in the Opelika-Auburn News of January 21, the paper’s publisher aptly calls Gingrich “an arrogant, hypocritical, corrupt blowhard” who “is disliked most fervently by those people who know him best. . . .” In my word, he is a slimy character.

Mitt Romney seems competent; and if he commits himself to so-called conservative policies, however belatedly, I suppose that he will faithfully pursue them. He could quite probably justify how he made his money and why he paid low taxes; but his doing so, however soundly, will leave a residue of doubt with many voters and will divert time and attention from real issues. He lacks charisma. Again, it is not unfair to expect electability of a candidate.

Rick Santorum appears to be a decent person, but he devotes too much attention to pushing socially conservative views rather than to real economic and fiscal problems. Ron Paul is sincere and passionate; but the voting public is not ready for consistent libertarianism, perhaps especially not on foreign policy. Gary Johnson would have been a more persuasive candidate inclined toward libertarianism. In comparison with the now remaining four aspirants, Jon Huntsman appealed to me.

It is hackneyed but relevant to recognize that the personal characteristics required of a successful campaigner are quite different from those of a high government official. What could be done? The Founding Fathers, well versed in history, had foresight. The Constitution, Article II, Section 1, says that each state shall appoint presidential electors “in such Manner as the Legislature thereof may direct. . . .” The legislatures might constitutionally specify the appointment of electors otherwise than by statewide direct popular vote, conceivably even by lot (although better ideas may turn up). And the electors from all the states might be encouraged to meet and discuss candidates before casting their votes. Of course, no such reform is in the cards.

As things now stand, I am afraid that Bret Stephens is right in his Wall Street Journal opinion piece of January 24: “The GOP Deserves to Lose.” I’d appreciate being shown why my pessimism is mistaken.




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Cash Poor

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In spite of Liberty contributing editor Mark Skousen’s observation that “income isn’t distributed, it’s earned,” much handwringing has followed recent reports that income distribution in the US is becoming increasingly unequal.

To a libertarian, how much one earns or owns — so long as it’s acquired honestly and honorably — is nobody’s business. But at the other extreme are the still-influential Rawlsian redistributionists. They believe that since each person’s station in life is due to little more than a roll of the existential dice, income distribution ought to cluster tightly. If it doesn’t, it’s an indication of an unjust society, and something must be done about it. That’s the ideology.

Nevertheless, there’s a pea under that ideological mattress: the fear of revolution if the rich get richer, the poor get poorer, and the middle class disappears. Though probably a reductio ad absurdum, it is nonetheless a theoretical possibility under a laissez-faire economic system.Friederich Hayek understood this, which is why — to the consternation of many libertarians — he advocated a minimal welfare state as a worst-case scenario safety net.

Whatever the chances might be that a just economic system — laissez-faire capitalism — could lead to the penury of a majority, income distribution is a concern to the inner Hobbesian in all of us. So when income inequality rears its ugly head, it bears critical investigation.

In 1912 Italian statistician and sociologist Corrado Gini devised the eponymous Gini Coefficient, a statistical formula based on the Lorenz curve, to measure variability and mutability among data in any discipline. The index is now widely accepted as a measure of income inequality in economics. Values range from 0, total equality, to 1, maximal inequality.

As of 2009, Sweden scored .23, the lowest Gini Coefficient, indicating the highest income equality; while Namibia rated a .74, indicating a large income inequality. Most first-world nations have Gini coefficients in the high point-twenties to the mid-thirties, with a .31 for the EU average. Back in 1980, the US rated a .40 Gini; today we rate around .47, a figure comparable to Russia or Turkey and a trend that is alarming to many.

The fear of revolution, though probably a reductio ad absurdum, is nonetheless a theoretical possibility under a laissez-faire economic system.

Paul Krugman, who could be considered the Linus Pauling of economics — for his previous Nobel-recognized genius, followed by descent into crankhood for his advocacy of snake-oil remedies: vitamin C in the latter case, dirigisme in the former — refers to the period after 1979 as the “Great Divergence,” because of the rapid increase in inequality that had occurred. According to a 2011 Congressional Budget Office report, “Real income (adjusted for inflation) in the US grew by 62% for all households between 1979 and 2007. However, after-tax income of households in the top 1% of earners grew by 275%, while income growth for the bottom fifth of earners was 18%.”

If, instead of income distribution, we look at wealth, the disparity is even greater. While the bottom 60% of the US population lost about 6% of its wealth, the net worth of the top 5% increased by 40% between 1983 and 2009.

Why the increasing inequality in a political and economic system deemed among the freest by classical economists?

* * *

Before addressing that question we must deal with a concept clamoring for immediate attention: fuzzy numbers.

Nearly all the figures quoted in this article come from Wikipedia compilations replete with references, from various other internet sites, The Economist,Scientific American, Money,Chris Martenson’s The Crash Course, and PuruSaxena’s Money Matters. Although these sources are ostensibly reliable, please take them with a pinch of salt. Some figures purporting to measure exactly the same thing vary wildly.

For instance, that 275% of after-tax household income growth for the top 1% earners, derived from 2011 Congressional Budget Office figures of 1979 to 2007, becomes a 176% increase — from 1979 to 2005, nearly the same time range — in a 2006 New York Times article.

Exactly what is being measured, how it is defined, over what period of time it is measured (a variable often manipulated for calculating equity returns down to the day), and what statistical tools are employed can have considerable impact on the figures. Just the difference between ‘”household” and “individual” income measurements can affect income inequality figures substantially.

Dodgy numbers can also lead to convertibility problems and out-of-this-world results — literally out of this world. Composite numbers (such as indices, among others), which are built up from subsidiary numbers, can become statistical black holes, swallowing endless data but illuminating little. As The Economist reports, “In theory, countries’ current-account balances should all sum to zero because one country’s export is another’s import. However, if you add up all countries’ current-account transactions, the world exported $331 billion more than it imported in 2010, according to the IMF. Are aliens buying Louis Vuitton handbags?”

And of course, ideology plays a big part. As the old saw goes, “He who frames the question determines the shape of the answer.”

On top of this are myriad unexamined assumptions. Statistician Joseph Locascio has identified what he calls “publication bias,” which means that academic journals “often give greater weight toward publishing articles that report statistically significant findings over those that don’t.” With this kind of review process, if out of 20 studies one shows a slight significance (perhaps because of chance), while the other 19 show none, that one will be published and the others ignored.

Not all people are driven to make the most money they can, all the time. Many earn and live below their possibilities, and spend the rest of their time pursuing their passions.

Hoover Institute economist Thomas Sowell suggests that many discussions of income equality are based on fallacious reasoning. For example, “an absolute majority of the people who were in the bottom 20% [of income] in 1975 have also been in the top 20% at some time since then. Most Americans don’t stay put in any income bracket. At different times, they are both ‘rich’ and ‘poor’ — as these terms are recklessly thrown around in the media.”

Finally, somewhere between the last two observations, lies individual choice. Not all people are driven to make the most money they can, all the time. Many earn and live below their possibilities, earning what they consider a sufficient amount, and spending the rest of their time pursuing their passions: music, rock climbing, walking around the world preaching the gospel . . . whatever.

So, to that pinch of salt, add a squeeze of lime and, what the hell, a shot of tequila.

* * *

But back to the ostensible causes of inequality, which remain unknown to many, even to theNew York Times, as proclaimed in an article onJune 5, 2005. Let’s consider these causes.

1. The rich work more than the poor. As of 2005, 42% of all US households had two or more income earners. However, in the top quintile of households, nearly twice as many (76%), had dual-earners. Among the lower class, the most common source of income is not occupation but government welfare (according to the leftish Winner-Take-All Politics by Hacker and Pierson, 2010).

2. The rich are more educated than the poor. In the top quintile, 62% of householders are college graduates; while many at the bottom half of earners hold at most a high school diploma. Educational and occupational achievement and the possession of scarce skills correlate with higher income.

3. People of modest means keep giving their money to the rich. George Mason University economist Walter E. Williams recently recognized that “the millions of people who watch LeBron James play are the direct cause of LeBron’s earning $43 million and are thereby responsible for — in Paul Krugman’s terms — ‘undermining the foundations of our democracy.’” The same can be said of the millions of Walmart and Microsoft shoppers who keep enriching the Walton and Gates families.

4. Government policies. Among the usual partisan suspects — such as decreased expenditure on social services and labor’s diminishing political clout, suffering from declining union membership — are Republican tax policies, specifically the “low” progressivity of US tax rates. Reversing these factors through government diktat is a crude cure that doesn’t address the underlying ecology (Thomas Sowell’s term) of the marketplace. The enforcement of legislation such as higher redistributive taxes and the imposition of closed shops would require force, a road down which classical liberals would prefer not to travel. Might there be another cause of the increasing income inequality that hasn’t yet been identified? One whose correction does not require coercion?

I believe there is, and that culprit is inflation — in spite of the fact that nearly all of the above statistics are adjusted for inflation. And, as Milton Friedman recognized, since “inflation is always and everywhere a monetary phenomenon,” it is a direct result of government policy. Inflation is a word often misunderstood. It is the decreased purchasing power of currency, caused by the expansion of the money supply, and not to be confused with price increases caused by scarcity.

Krugman’s “Great Divergence” begins soon after America’s divorce from the gold standard and the subsequent collapse of the Bretton Woods currency exchange system in the early 1970s. After that, the Federal Reserve instituted a Keynesian monetary expansionist policy. In 1972, the price of a new house averaged $27,600; in 2010 (despite 2008’s deflation of the housing bubble), the average price was $272,900. A 1972 Coke cost a dime; today it’s a buck. By 1973, gold hit a high of $126 per ounce; in 2009 it topped $1,212. In 1972 the Dow Jones Industrial Average hit 1,000; by 2010 it had reached 11,000 — a ten-fold increase in only four decades. A $10 Hamilton from 1972 is today’s $100 Franklin. How does this stark change affect the disparity between rich and poor?

* * *

But first, more fuzzy numbers.

Without an objective anchor such as gold, the value of money is subject to fluctuation according to the active “monetarist” policy set by the central bank. That policy is based on many variables — prominently including the consumer price index (CPI), with a nod to gross domestic product (GDP), processed through complex formulae and topped with a generous dollop of intuition. The objective is a stable currency — a very difficult goal with such a capricious policy, and one whose results always lag policy implementation.

For a variety of reasons, the central bank considers deflation a greater evil than inflation. So, wishing to avoid deflation at any cost, the Federal Reserve sets an inflation goal of 1–2%. It often misses this goal. The October 2011 rate was 3.53%, according to the Bureau of Labor Statistics (BLS), as measured by the CPI.

How reliable is this number? Not very — as it is neither accurate nor even precise. Like an aging diva afflicted with weight gain, wrinkles, fatigue, loss of figure and overexposure, the CPI has been massaged, injected with Botox, subjected to fad crash diets, over-cosmetized, face-lifted, repackaged, and rebranded. Richard Nixon, for example, bequeathed us the so-called “core inflation” measure, which strips out food and fuel — a bit like weighing yourself without your belly. In 1996 Bill Clinton implemented three oddities in the measure of inflation: substitution, weighting, and hedonics.

Krugman’s “Great Divergence” begins soon after America’s divorce from the gold standard and the Federal Reserve’s institution of a Keynesian monetary expansionist policy.

With substitution, it is now assumed (for example) that if the price of salmon goes up too much, people will switch to something cheaper, such as hot dogs. So as the price of an individual item within a representative basket of thirty goods rises, that item is removed and substituted with something cheaper, chosen by a trained bureaucrat. According to the BLS, food costs rose 4.1% from 2007 to 2008. But according to the Farm Bureau, which tracks exactly the same shopping basket of 30 goods from one year to the next without substitution, food prices rose 11.3% for the same year.

Weighting is an even sharper tool for cutting the measure of inflation. Anything that rises too quickly in price is undercounted in the CPI, under the assumption that people will use less of those things. For example, although healthcare is about 17% of the economy, it is weighted as only 6% of the CPI basket.

But the most creative way to fiddle with inflation is hedonics. This adjustment is supposed to reflect quality improvements. Here’s how it works, based on a presentation by a commodity specialist at the BLS and explained by Chris Martensen:

In 2004, the commodity specialist at the BLS noted that a 27-inch television selling for $329.99 was selling for the same price in 2007, but was later equipped with a better screen. After taking this subjective improvement into account, he adjusted the price of the TV downwards by $135, concluding that the screen improvement was the same as if the price of the TV had fallen by 29%. The price reflected in the CPI was not the actual retail store cost of $329.99, which is what it would cost you to buy, but $195. Bingo! At the BLS, TVs cost less and inflation is heading down. But at the store, they’re still selling for $329.99.

Hedonics rests on the improbable assumption that new features are always beneficial and are synonymous with falling prices (never mind that most old rotary phones still work, while modern cell phones seldom seem to last three years). Hedonics is now used to adjust as much as 46% of the total CPI.

What would the inflation rate have been for, say 2008, before all the fuzzy statistical manipulation gussied it up? John Williams of shadowstats.com, using early 1980’s formulas, computed the figure at 13%: the BLS reported a 5% inflation rate for the same year — a stunning 8% difference.

But that’s not all. During Alan Greenspan’s tenure at the Federal Reserve — particularly while the real estate bubble was growing gangbusters — some economists bemoaned that, without asset prices such as real estate and equities being included in the CPI, true inflation rates would be misleading, thereby skewing monetary policy.

While inflation has been massaged down, GDP has been steroided up, by similar sleight-of-hand manipulations — further inflating the money supply.

So, at this point, brace yourself with another shot — this time of hedonic Cuervo Añejo.

* * *

Inflation affects the poor and the rich in completely different ways, though both lose wealth. No one benefits — except for government and banks, which, having access to newly created money before it hits the streets and raises prices, can buy goods and services at the old, cheaper rate. By the time the surplus money has permeated the economy and reached the masses, prices have usually risen significantly.

Broadly speaking, the poor — for the purposes of this essay, people in the lower 40% of income distribution — have fewer assets, lack financial sophistication, and tend to hold, at most, a high school diploma. They deal in cash and its derivatives and equivalents — CD’s, bonds, and interest-bearing accounts. In an inflationary regime, these lose value. In an underreported inflationary regime, the effect is not only obviously greater but, because wages only grudgingly and loosely track the “official” inflation rate of the CPI (if at all), “much of the developed world’s workforce has been squeezed on two sides, by stagnant wages and rising costs,” as The Economist opined in its November 19, 2011 issue.

There is one factor leading to wealth disparity that Rawlsians and Marxists most seem to ignore, but classical economists believe is fundamental — productive innovation.

As if this situation were not bad enough, many of the poor were lured into buying homes by dodgy loans and government social engineering policies (such as the Community Redevelopment Act, Fannie Mae and Freddie Mac practices, and lower than historic interest rates) in the middle of a bubble. When the bubble burst, these folks lost whatever equity they had managed to cobble together, as well as ending up with ruined credit. And they couldn’t even rely on their savings (what little they might have saved between stagnant wages and rising costs), as these too had dwindled along with the higher interest rates that made savings more attractive.

So, without a doubt, the poor are getting poorer. What about the rich?

While cash loses its value, real goods such as commodities, equities, and real estate track the changing value of money and, long term — with the dips and highs of the business cycle evened out — generally keep pace. The rich, with more education, more financial sophistication, and more discretionary income, invest. The poor, on the other hand, save (if they can afford to). All other things being equal, inflation makes investments tread water, but savings lose. Without inflation, income inequality might not have become so pronounced over the last 40 years.

Though the above analysis might go a long way toward explaining the increasing income inequality in the United States, it still isn’t the full picture.

There will always be income inequality, if for no other reason than the fact that people’s work habits, education, and ambition vary tremendously. But the one factor leading to wealth disparity that Rawlsians and Marxists most seem to ignore, but classical economists believe is fundamental — productive innovation — also plays a big part.

A study done by University of Texas economists James K. Galbraith and Travis Hale found that

During the technology boom of the late 1990s, most of the gains enjoyed by the top 1% came from a small number of counties, rather than a national trend. Almost all of the richest 1%’s gains occurred in the economic hotbeds of Silicon Valley, and also New York City. If the top four counties in those regions are removed, there is almost no trend towards income inequality during the years studied (1994–2000). On this basis, the researchers ascribe the growth in income inequality in the late 1990s to the growth of information technology.

Earned income.

Definitely.




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Terminal Ennui

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“Shall I compare thee to a summer’s day?” Thus Shakespeare, in Sonnet 18. No, Shakespeare answers; that comparison won’t do: “Thou art more lovely and more temperate.”

The poet’s complaint is that sometimes he just can’t think of a sufficient metaphor. Of course, his complaint is merely a pretence, merely a way of starting a poem. Shakespeare could never be at a loss for imagery.

Well, I can be. Especially now.

What a season we live in! Its dullness exceeds all normal human powers of simile and metaphor.

A ship runs into a sandbar and takes on water. A handful of its 4,000 passengers and crew perish. So dull are our times that this event, the “sinking” of the Costa Concordia, is heralded throughout the world as a “Titanic-like tragedy.” But look, the ship didn’t even sink. It’s there right now, more than halfway out of the water. If it wasn’t for the Italian coast guard, picnickers could be frolicking there today. To what shall we compare the public reaction to this non-event?

The big political news in California is that our Democratic governor wants to raise taxes. What a surprise! Also that he and the Democratic leadership of the state House and Senate want to keep financing a 400-mile “high-speed” rail project that wouldn’t even be high-speed, at a cost only five times as great as that authorized by voters when they foolishly, but predictably, authorized it, several moons ago. Shall we compare this to a summer’s day? Is it worthwhile even to hunt for metaphors?

Now turn and survey the Republican primary context. How many “debates” have these people had? 15? 18? 95? And it’s barely election year. Shall I compare this to a winter’s sludge? And look at the candidates. Look at their “issues.” Exempting Ron Paul, who actually has radical things to say (although, ahem, you and I have heard them many times before, because we are libertarians), what the hell do these people have to say that’s worth saying at the length they’ve already taken? Shall we compare them to snails, bewitched by their progress across a 10-foot sidewalk? To mice steadily eating their breadloaf house? To a nest of blind mole rats? To a wall from which all brickbats bounce?

But you see how far one has to reach for imagery. It’s hopeless, truly hopeless. I won’t even try finding metaphors and similes for the current president. Now there is one dull fellow. Imagine a book entitled The Wit and Wisdom of Barack Obama. You see my point.

In Richard III, someone mentions “the winter of our discontent.” Shakespeare, thou shouldst be living at this hour! Then you could write about the ice age of our boredom.




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Making Art from the History of Art

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Hollywood has a way of both following trends and creating them. We can see these trends develop whenever we look back at the course of a Hollywood year. Filmmaking is now nearly a hundred years old, and while its beginning is not specific enough to generate any "100th anniversary" hoopla, several films this year looked back at the groundbreaking artistry of filmmaking that we often take for granted. These high-quality movies have worked on two levels — as entertaining stories that stand on their own, and as tributes to filmmaking itself.

Let's look at some of these stylish 2011 films that are still making news at the awards shows in 2012.

Tinker, Tailor, Soldier, Spy (directed by Thomas Alfredson; Studio Canal, 127 minutes)

John Le Carre's novels about the Cold War era are among the finest spy thrillers. His recurring espionage agent, George Smiley, is not a caricatured James Bond or a rough-and-tumble Jason Bourne. He demonstrates the true complexity and moral conflict of a man who protects his country and her way of life by infiltrating and often breaking the laws of another. He is a man who lives a life of quiet isolation. Gary Oldman plays him brilliantly in this version.

When I saw that Tinker Tailor was being remade, my first reaction was "Why now?" The Cold War has been over for a long time. Countries that once made up the Soviet bloc are no longer our enemies, and the political and economic philosophies that separated us then don't inform the conflict we now experience in the Middle East. Agent Smiley "came in from the Cold" a long time ago, and for good reason. I wondered whether this story about a mole in the upper leadership of MI6 would be updated or modified to offer a fresh look at current moral dilemmas.

The answer to "Why now?" surprised me. Tinker Tailor isn't just a remake of a spy thriller. It is a remake of a ’70s film, and another offering in this season's retro moviemaking trend. More than a movie about the ’70s, it is a movie made like a ’70s film. Filmed in Super 16mm, which was used for filming television shows and some movies during that time, Tinker Tailor has the grainy texture of a Bullitt or a French Connection, two films that represent the era. The direction is slow, and the pacing even slower — as in those films, which we once considered so tense and exciting.

Everything about this film makes it feel like a reissue rather than a remake. Its old-school communication equipment, Wang word processors, shaggy hairstyles, and polyester clothing feel natural and unobtrusive rather than recreations designed for retro effect. It was reported that Oldman searched diligently through several vintage shops to find just the right eyeglasses for Smiley to wear. Even the outdoor scenes of London have the grimy, dusty look of the ’70s, before London was scrubbed clean and white in the ’80s and kept that way through better emissions controls.

Tinker, Tailor, Soldier, Spy isn't as thrilling as the Bourne movies or as campy as the Bond films. But it is an impressive tribute to the books and films of the ’60s and ’70s, with an impressive cast of A-list actors as well.

My Week with Marilyn (directed by Simon Curtis; Weinstein Co., 99 minutes)

Here is another 2011 film that celebrates the art of filmmaking. Anyone interested in the behind-the-scenes aspect of the movies will enjoy this one about the making of The Prince and The Show Girl (1957) as seen through the eyes of Colin Clark (Eddie Redmayne), a young aspiring filmmaker who worked on the production despite the disapproval of his aristocratic family.

In 1956 Marilyn Monroe (Michelle Williams) was the biggest star in Hollywood, if not the world. Laurence Olivier (Kenneth Branagh) was the greatest Shakespearean stage actor. They came together that summer to make The Prince and the Show Girl, starring and directed by Olivier. Through sheer will and determination (and the good fortune of having met the Oliviers at a society party), Clark secured a job on the film, as third assistant director — little more than a go-fer, really. Nevertheless, Clark caught Monroe's eye and became her boy-toy for a week, in every sense of the phrase. And Clark kept a journal.

It was not an easy shoot. Monroe was constantly late to the set, constantly muffing her lines, and constantly close to tears. She brought her own acting coach with her, Paula Strasberg (Zoe Wanamaker) of the method school of acting, and this created conflict with Olivier as the actual director of the film. As Clark tells Marilyn when he tries to comfort her after one of Olivier’s biting criticisms, "It's agony because he's a great actor who wants to be a film star, and you're a film star who wants to be a great actress. This film won't help either of you."

Kenneth Branagh, who plays Olivier in this film, has similar aspirations for mixing media. Perhaps the greatest Shakespearean actor today, or at least the best known, Branagh's goal has been to move Shakespeare from the stage to film, where the bard's plays will be more accessible to the masses. He has succeeded by bringing seven of them to the screen. His Iago in Othello (1996), with Lawrence Fishburne in the title role, is a masterpiece. Nevertheless, I had my doubts when I saw Branagh enter this film as Olivier. He just didn't look the part. But there comes a moment, as he is applying his makeup for the coming scene as the Prince, when his entire countenance changes and Olivier takes over the body they are sharing. At that moment Branagh simply disappears into the role. Remarkable.

Equally good is Dame Judi Dench as the gracious and gentle Dame Sybil Thorndike, grand dame of British stage and film in the first half of the 20th century, the actress who played the Queen Dowager in The Prince and the Show Girl. Where Olivier is critical, Thorndike is encouraging. When he reacts with exasperation to Marilyn's repeated flubs, Dame Sybil kindly praises her. She greets all the people on the crew by name and expresses genuine interest in them. Dench, the new grand dame of British film and stage, met Thorndike when she was new to acting. She said, "She came round to see us after [our presentation of Romeo and Juliet] and was so charming. We were young actors and she was lovely to us and strongly encouraging and gentle. I think they got very, very close to how Dame Sybil was in the script."

The best art and poetry can evoke an entire life in a single moment. This is the case with My Week with Marilyn. Through her affair with Clark we learn about the memories of childhood abandonment that led to Monroe' lifelong insecurity and vulnerability. We see her fears about not measuring up as an actress, her dependence on pills, and her anxiety about being alone. We see how frustrating it was to work with her, and how hard it was for her to live up to being the idolized Marilyn. And we see the magic she created on film when she felt good about herself. It’s one of the best bio-flicks I’ve seen in a long time.

Clark predicted that making The Prince and the Show Girl would not help either of the principals’ careers. But he was wrong. Olivier's next project was The Entertainer, his memorable film about Archie Rice, an aging vaudevillian actor. He received numerous accolades for the stage production and was nominated for an Oscar when the play was adapted for film in 1960. He said of that role, "I am Archie Rice. I am not Hamlet."

And Marilyn Monroe? Her next film was Some Like It Hot.

Hugo (directed by Martin Scorsese; Paramount, 126 minutes)

This film is about a young boy who lives inside a Paris train station, fixing the clocks. It appears at its outset to be a charming fantasy. Populated by cartoonish characters and centered on an impossible premise, it simply can't be true. But underneath the magic tricks of fiction is the true story of George Méliès, one of the early pioneers of filmmaking. More than a hundred years ago, Méliès developed stop-action animation techniques to create special effects. He hand painted individual cels to make color, and experimented with multiple exposures and time-lapse photography. You have probably seen snippets of his famous A Trip to the Moon, in which the man-in-the-moon is shot in the eye during a rocket ship's landing. You probably haven't seen many of his other films, because the French government confiscated most of his works during the Great War and melted the celluloid down to make boot heels for the soldiers. At the time, filmmaking was considered a timewasting entertainment. No one realized the great historical and artistic value of Méliès's work. And as far as Méliès himself knew, everything was gone.

Later, friends of Méliès set him up with a toy shop in the Montparnasse train station so that he could earn a living. Later still, a few copies of his works were recovered by journalists interested in his story. Eventually he was awarded the Legion of Honor for his work. All of this, as well as many of his groundbreaking film techniques, appear in Scorsese's marvelous film. The movie may purport to be about a fictional little boy who fixes clocks in the Paris train station, but it is no “kids’ flick.” It is one of the most satisfying films of the season.

The Artist (directed by Michael Hazanavicius; Warner Brothers, 100 minutes)

Perhaps the most significant film in this category is The Artist, which won the Golden Globe for best picture this week. It was reviewed for Liberty by Gary Jason, but it is worth mentioning again from the perspective of its tribute to the art of filmmaking itself.

The technology necessary to record sound was available to filmmakers from the very beginning; after all, Edison invented the phonograph before he invented the motion-picture camera. What these early filmmakers lacked was the ability to synchronize sound with action. So movies remained silent, substituting music to complement the action and enhance emotion on the screen. In New York, full orchestras provided that music in ornate theaters for audiences of more than 5,000 people. Small-town theaters employed organists to play the soundtrack. Actors used body language, facial expressions, and outright pantomime to communicate conflict and exposition. Obviously, complex story lines heavy with dialogue were close to impossible. Emotion and physical comedy dominated.

The Artist is a silent movie whose story is set in 1927–32, when the stock market wasn't the only thing that crashed. Silent films also came tumbling down as the problem with synchronization was resolved and talkies took over. Like the marvelous Gene Kelley-Debbie Reynolds-Donald O'Connor musical Singin' in the Rain (1952), set in the same era, The Artist follows the careers of a handsome silent film star and a bubbly young ingénue whom he has discovered — in this case George Valentin (Jean Dujardin) and the aptly named Peppy Miller (Berenice Bejo). George is the quintessential ’30s film star with his pencil thin mustache and dazzling smile. But he refuses to make the transition to talkies.

Without the dialogue and complex storyline that characterize modern filmmaking, director Hazavanicius invites the audience to focus on the rich artistry of early filmmaking — the lighting, the use of shadows and reflections, the camera angles, the elegant costumes, and the stylized sets, among other features. Silent films are often parodied for their actors' broad pantomime and "mugging" for the camera, but this criticism is deftly contradicted by the emotional range portrayed by these actors' facial expressions and body language. Yes, there was some serious overacting in early films, but The Artist reminds us that there were astounding subtlety and depth as well.

The Artist really is a silent movie; with two very short but very important exceptions, the only sound you will hear is music. The soundtrack is splendid, and even includes a tribute to Alfred Hitchcock — a long section of Bernard Herrmann's soundtrack from Vertigo at the emotional climax of the film. So be prepared, but don't let this fact keep you away from the film. It is, as its title suggests, a work of art.

Super 8 (directed by J.J. Abrams; Paramount, 112 minutes)

Super 8 rounds out the list of 2011 tributes to filmmaking with a summer blockbuster paean to both filmmaking and filmmakers. As I wrote in my June 14 review: "Super 8 is the best Steven Spielberg movie to come along in years. And it isn't even a Spielberg film."

Written and directed by J.J. Abrams, it is the most Spielbergian film to come along in many years, a veritable homage to the master of blockbuster films inhabited by preadolescent protagonists. Among the Spielberg effects that Abrams incorporates in this science-fiction coming-of-age thriller are the trademark bicycles spinning into getaway mode, the classic suburban settings, the snappy potty-mouthed dialogue among kids, and the Orwellian military bad guys, reminiscent of E.T. Best of all, Abrams employs the particular kind of coming-of-age storyline for which Spielberg is known. Yes, there's a monster out there, but the real monster is at home, in the form of an unnamed tension between parent and child that has to be resolved.

Super 8 is an homage in a different way as well. Setting aside the aliens that are attacking the city (and that might be hard to set aside in real life) is a classic “let’s put on a show” format that would have made Mickey Rooney and Judy Garland feel right at home. In movies like theirs, groups of kids were always transforming a barn into a stage in order to raise money for some worthy cause. The format gave the filmmakers an excuse to present rousing music-and-dance numbers that had nothing to do with the plot.

In Super 8, Riley (Charlie Griffiths) is trying to make a film for a teen film festival. In the spirit of Judy and Mickey, he enlists all his friends to act as makeup artists, sound technicians, camera operators, actors, and writers. And in the spirit of this article about retro themes, they do it with a vintage Super 8 camera, the kind we used to use to film three minutes of family activities before sending the cartridge out to be developed. Many of today’s directors got their start with the family Super 8, including Spielberg, on whom Riley's character is based. Spielberg won a prize at a teen film festival when he was 13. Moreover, his first Super 8 film culminated in a train wreck created by his Lionel model trains, just as Super 8 does.

Like all the films highlighted in this article, Super 8 stands on its own as a well-made, entertaining movie. But these films become even more enjoyable when one recognizes the allusions they make and understands the background of the filmmakers they honor. As we pass the hundredth year of motion pictures, universities are legitimizing the art with degrees that focus on the history of filmmaking, not just on the technical aspects of making a film. I think this trend will continue to influence the quality of filmmaking, especially in works by independent filmmakers — and the influence will be all to the good.




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They're Coming for Your Internet

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In a thinly-veiled message to Internet users throughout the US and beyond, the FBI today (Jan. 19) shut down the file-sharing service MegaUpload.com, seizing the company’s domain name along with its headquarters. With this raid, the feds clearly meant to show that they were the bosses of the online world, laws and legislation be damned. As usual, they had no idea what they were getting themselves into.

Back up a couple days. On the eve of January 17, Internet sites all over the world were preparing to “blackout” to protest the Stop Online Piracy Act (SOPA) then under consideration in the House of Representatives (in the Senate, as the Protect Intellectual Property Act, or PIPA). The bill would give the government power to seize any website that was reported to be hosting pirated material, or even providing links to such material.

Those doing the reporting, of course, would be the media companies themselves — thus giving them, essentially, a kill switch for sites they don’t like. So if you pan a big-budget movie — or break off a relationship with a studio exec — or really just in any way piss off anyone connected to a lawyer in the entertainment industry — your site could get shut down without due process and without recourse.

But the possibilities for petty revenge are far from the worst thing about the bill. That would be instead its potential to crush political dissent. Under SOPA, the presence of any link to “pirated” material would be sufficient to kill a site — even if the content is provided by anonymous commenters. Hence, the easiest way to silence dissidence online would be to spam the offending site with dubious links.

Even the biggest sites would be susceptible to such tactics; hence why even the behemoths of the Internet, such as Google and Wikipedia, signed onto the protest. With such sites as these “blacked-out” (usually redirecting to petitions or email-your-congressman forms), even casual Internet users found themselves confronted with the ramifications of the government’s latest lunatic notion. For once the people spoke, and many Congressmen reversed position.

The feds couldn’t let such a demonstration go unpunished, but lacking the power to shut down Google and Wikipedia (for now, anyway), they did the next best thing: publicly target and destroy a site like MegaUpload, as a way of announcing that they would shut down whomever they felt like. What they always forget, though, is how little they know about computing and networking, compared to the people who put together the kinds of sites they want to shut down. The response from the actually competent sector of the online world was swift and brutal: within two hours, the hacker collective Anonymous (previously best known for taking down the Church of Scientology site) had attacked and temporarily killed off the sites for the Department of Justice, the FBI, the Motion Picture Association of America, the Recording Industry Association of America, the US Copyright Office, and assorted major film studios and record labels.

These sites will all come back, obviously: only the government would claim the right to banish a site for good. But the mere fact that they could go down at all shows their vulnerability to attacks from very loosely affiliated networks of competent individuals. And that is a weakness that, try as they might, the DoJ, the FBI, the MPAA, et al., can never come to grips with: their very existence is predicated on massive, centralized, bureaucratic incompetence. To give that up would be to begin their own dismemberment.

It will be fascinating — and a bit worrying — to see how the government and major media companies will respond. Certainly SOPA and PIPA will come back in new, more insidious forms, probably as riders on unrelated bills. Though President Obama bucked his industry pals and came out against the bills this time (only, of course, once the online campaign against them was in full cry), there is no guarantee he would in a second term. Meanwhile, among the Republican candidates, only Ron Paul (natch) has denounced the bills; a President Romney, Gingrich, or Perry would probably sign them into law. [Edit: in the evening's Republican primary debate in South Carolina, candidates Romney, Gingrich, Santorum, and Paul all spoke out against SOPA — though Romney and especially Santorum still appeared to leave space for future censorship of the internet.]

Until then, what is required of us is vigilance — vigilance, and an unyielding determination not to let a few hundred computer illiterates in Washington DC legislate away our cultural future.



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Government-Grown Lemons

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A flurry of recent reports brings us up to date on GM — now known as Government Motors, after its nationalization by the Regime. The news is less than inspiring.

First is the report that GM is recalling nearly 4,300 Chevrolet Sonics — because they may be missing their brake pads! The incredible news is that workers at the Orion Township, Michigan assembly plant left off inner or outer brake pads on many of the Sonics manufactured there.

The funny thing is that the same Regime Secretary of Transportation Ray LaHood who told Americans to avoid Toyotas in a bogus brake scare is totally silent about this real brake fiasco.

Then there's the news that came out on the “legendary” Chevy Volt — you know, the EV green machine car of our future. For one thing, it appears that the damn things are costing American taxpayers about $250,000 for every vehicle sold. This to subsidize a car purchased by people whose average income is $170,000 a year.

That’s the estimate provided by James Hohman, economist at the Mackinac Center for Public Policy. He analyzed the 18 government deals that were involved in setting up the Volt line — all the loan subsidies, taxpayer-funded rebates, tax credits, and government grants at the federal and state levels that were arranged for this car. The thing is indisputably green in one sense: it takes taxpayer dollars to keep it alive.

Hohman's estimate does not, by the way, include the bailout money that has been shoveled at GM as a company. Nor does it include municipal support.

The deals Hohman reviewed included $690 million of support by the state of Michigan and $2.3 billion in federal support. That’s a total of $3 billion in for the 6,000 Volts actually sold. As Hohman puts it, “This might be the most government-supported car since the Trabant” (the infamous piece of junk manufactured by East Germany).

Worse, it turns out that GM is calling back all Chevy Volts because of a fire hazard. Seeing several Volts catch fire after crash tests showed that electrical shorts in the battery can ignite the coolant, GM is going to try to fix the problem by strengthening the battery compartment. Just in time!

But the Volt isn’t the only EV that is prone to battery-induced fires. Fisker Automotive has announced that it is recalling its entire line of luxury plug-in hybrids (which sell for over $100,000 each!) because of fire hazards.

I mention the Fisker, because even though it builds its cars in Finland, it received $529 million in American taxpayer-backed loan guarantees. The Regime assured us that the American taxpayer would be paying to provide American jobs, but that was just another lie.




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Sad and Confused

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In 1996 Margaret Thatcher was the keynote speaker at the Foundation for Economic Education's 50th anniversary banquet at New York's Waldorf Astoria Hotel. It was such a big event, and Thatcher was such a gigantic speaker, that William F. Buckley, a formidable force in conservative circles, agreed to appear as a moderator rather than a speaker.

Buckley’s role was simply to introduce Lady Thatcher and handle questions during her presentation. He was told to keep things moving and not let the answers go on for more than a couple of minutes. Buckley took his job seriously, standing up after two minutes to gently let Mrs. Thatcher know it was time to stop talking and let him ask the next question.

But Lady Thatcher was having none of that. She had handled the members of Parliament for over 30 years; she could certainly handle William F. Buckley! A questioner asked about China; Lady Thatcher began speaking; and after two minutes, Buckley stood up. Thatcher continued speaking. Buckley edged toward the microphone. Body language shouted for Thatcher to yield.

She did not. The Iron Lady filibustered on China for several minutes. She talked about politics. She talked about industry. She talked about pandas! She spoke eloquently and intelligently, including specific names and details. She knew her stuff. Buckley stood beside her like an errant fool, until he finally backed away and sat down. Only then did Thatcher conclude her remarks on China and graciously ask, "Next question?"

She was a lady throughout. She never scowled, she never lost her temper, she never stopped speaking. But she had a spine of iron. The great William F. Buckley was put soundly in his place, with grace and good manners. And she gave the audience a jolly good show. I've never forgotten it.

We see none of that character and grace in The Iron Lady, now in theaters with more than a few whispers of another Oscar nomination for Meryl Streep. Streep is indeed wonderful in the role she is playing. She shuffles with the hesitant gait of a woman in her 90s. She mimics Thatcher’s voice and cadence. She carries her unnecessary handbag with the dignity of the Queen. But she projects none of the grit, power, and philosophy that made Margaret Thatcher one of the most important leaders of the 20th century. For most of the film, her Thatcher is pathetic and befuddled.

We do not go to a movie about Margaret Thatcher to see how sadly she has aged. We want to see her in her greatness, not her twilight.

The Iron Lady opens on an elderly nondescript woman shuffling through a grocery store, hesitating over whether to purchase a quart or a pint of milk. She selects the smaller container, pays the grocer her meager 49 pence, then shuffles out, bumping into other shoppers who refuse to yield for the seeming bag lady. After returning home to breakfast, she complains to her husband (Jim Broadbent) about the price of milk. This is not the prime minister who rescued England from bankruptcy; this is the grocer's daughter who seems to live now in the projects.

Worse, it turns out that Dennis Thatcher has been dead from cancer for several years. Nevertheless, he and Margaret talk to each other throughout the film. He is in her dressing room, her kitchen, her living room, her bed. She knows he is dead. She knows she is hallucinating. But she talks to him anyway. It's natural to speak to a deceased loved one and say "I miss you" out loud. Jimmy Stewart "talks" to Martha at her graveside in Shenandoah. Heath Ledger poignantly breathes the smell of Jake Gyllenhaal's shirt at the end of "Brokeback Mountain." Streep does something similar when she goes into Dennis's closet and breathes in the smells from his jacket. But she goes way beyond portraying grief. Streep’s Thatcher is bereft, bewildered, and befogged.

It is true that Mrs. Thatcher has suffered a couple of strokes in the past few years, and it may be that her mind has become befuddled. She's 87 years old. But we do not go to a movie about Margaret Thatcher to see how sadly she has aged. Or to see how well Meryl Streep can play an aged woman. We want to see evidence of Thatcher's iron will, her brilliant economic philosophy, her political wit and candor. We want to see her in her greatness, not her twilight.

As so often happens in Hollywood when filmmakers portray conservative heroes, the producers of this film are fascinated by their subject but unwilling to give her credit for her accomplishment. We see numerous scenes of IRA bombings and union riots. We hear voiceover about spending cuts, unemployment, and Britons' inability to pay their mortgages. Thatcher proclaims at one point that they will need to close inefficient mines.

All this makes the film very timely, reminding the audience of current events in America: high unemployment, falling wages, mortgages in default, out-of-control deficits, and Romney's ill-advised statement, "I love to fire people." What's missing is the mountain of good that was accomplished by Thatcher's privatization policies, under which government workers were given the opportunity to own shares in the privatized utilities for which they worked.

I lived in London during the ’80s. I saw the results of privatization. Allow me one personal example. When we bought our flat in 1985, we wanted to add a second phone line. We were told we would have to wait at least two years for a number to become available. We also needed some repair work done on the existing phone line, for which we were given an appointment six months in the future. Six months! We were stuck with the antiquated instrument itself. Brits could not even purchase their own equipment; everything belonged to the government utility, and the government utility was not about to update the phone.

As so often happens in Hollywood when filmmakers portray conservative heroes, the producers of this film are fascinated by their subject but unwilling to give her credit for her accomplishment.

A couple of years later, after the phone company had been privatized, I called again to have my phone repaired. A repairman was at my flat the following morning. In a few short years the company had become profitable, efficient, and prompt. Yes, some people lost their jobs, especially from the ranks of bloated, redundant management. Cutting costs does hurt in the short run. But they were offered severance packages and early retirement opportunities. In the long run, the entire citizenry profited from lower costs and better technology. The filmmakers deliberately overlook this point, and all points like it.

Instead, we see glimpses of Thatcher's life through the eyes of a sad, confused old woman. Occasionally she reaches back into her days as the daughter of a grocer (albeit a grocer who was active in local politics), determined to "make one's life matter," and to her decade as prime minister. But these scenes are brief and unsatisfying. They focus mostly on her ineptness as a mother, her shrillness as a speaker, her bouffant makeover, and her problems with being accepted by Parliament.

I ask you: would Dennis have been criticized for choosing to go into politics instead of staying home to raise the children? Yet Margaret is vilified for her decision — and by a triumvirate of females, no less: woman screenwriter, woman director, woman producer. Her daughter Carol (Olivia Colman) flounces off in anger when Margaret announces that she is going to stand for the leadership of the Conservative party, and apparently the audience is supposed to be sympathetic — to Carol! When the elderly Mrs. Thatcher looks through a box of mementoes, it is filled with hand-drawn cards and crayoned pictures that say "I love you Daddy." None are written to "Mummy." This hardly seems fair, especially in today's climate of opinion. If a man isn’t criticized for leaving his family while he goes to work, why should a woman be?

Thatcher brought a unique sensibility to her role as prime minister. As she wrote in at least one letter to the parents of a soldier killed in the Falklands War: "I am the only prime minister in Britain's history to have been a mother." She had long-term vision, coupled with an understanding of short-term costs. She was exactly what Britain needed. She should be remembered as a woman who devoted 50 years of her life to public service. She should not be remembered as a pathetic old lady who barely knows her own name.

The young Margaret Thatcher is played winningly by Alexandra Roach. Perhaps if Roach had been prosthetically aged and allowed to play the entire role, The Iron Lady would have been an engaging and enlightening biopic similar to the very fine film The Queen (2006), in which Helen Mirren gives an intimate and insightful portrait of Queen Elizabeth. Instead, The Iron Lady is simply a vehicle for Ms. Streep to demonstrate her considerable skill at mimicry.

This is not necessarily Streep's fault. She did not write the script. But I doubt that she bears any of the admiration for her subject that Mirren bears for hers. I'm certain that she enjoyed portraying Thatcher as the shuffling, elderly, hallucinatory woman who was written for her to play. She will probably receive her umpteenth Oscar nomination for the role.

I just hope she never has the bad fortune to meet Lady Thatcher in public. I suspect Streep would receive a gracious, well-mannered cold shoulder that would make Buckley's treatment at the FEE banquet look like a warm embrace. And it would be much better deserved than the Oscar nomination she is likely to receive.


Editor's Note: Review of "The Iron Lady," directed by Phyllida Lloyd. Weinstein Productions, 2012, 105 minutes.



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How Unpatriotic Can You Get?

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One of the classic attacks by leftists on rightists is the assertion that people on the right typically question the patriotism of their opponents. In my experience, it is typically the leftists who resort to that particular ad hominem trope.

We have no better illustration than our current National Healer, Barack Obama. Obama, a master of the ad hominem attack, famously called Bush “unpatriotic” for running up nearly $4 trillion in national debt. (That included TARP, which was repaid by the banks with interest, early in Obama’s reign.)

Now, however, Obama has quietly requested another $1.2 trillion rise in the national debt ceiling. That would raise the current national debt to $16.4 trillion. In his three years in office, he has already added $4.6 trillion to the debt, far more than Bush did in eight years. Obama makes Bush look like a miser — no easy feat. He is increasing the national debt at an average of $4.24 billion a day, and will have added $6.2 trillion to the debt in his first (and, I hope, his last) term.

That would mean that Obama will have added more to the national debt than all the presidents preceding Bush — from Washington to Clinton — combined. To use another epithet he hurled at Bush, his spending has been nothing short of “irresponsible.”




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