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26 November 2010


Steven Frisch

George just provided me with a great illustration of the futility of posting here. Specifically, George is trying to shift the debate from his original "The Nazi Party not only supported but also implemented state ownership of the means of production", to, "“The basic feature of our economic theory is that we have no theory at all.”

On one hand George takes me to task by inaccurately implying that I did not know the timeline of the NAZI seizure of power and stating that there was no NAZI economic policy, and on the other hand quotes a speech by Hitler that was delivered in 1922--which thus bears no relationship to the economy Hitler instituted 13 years later as Chancellor.

George does not recognize the inherent contradiction in his case--if on one hand, according to Hitler, NAZI economic policy was 'there is no policy', then he is demonstrably wrong when he says their policy was the state ownership of the means of production, and thus should be more closely associated with socialism than fascism. If, ion the other hand, there was a policy, and historians disagree with George enough to have written several very good books about the NAZI economy, and that policy was to retain ownership in private hands, then he is wrong as well.

I would ask readers, how would it have been possible for an economy the size of Germany's in 1940, which eventually included almost all of continental Europe, to not have a conscious economic policy? The answer is, they did, it was authoritarian state supported corporatism.

George can't win. He sounds like a one armed economist. Which leads later to a much more interesting question, "Why is it so important to George that people believe that the NAZI's were more socialist than fascist?"

But I digress; who agrees with me that NAZI Germany had an economy, that it was corporate statism, supported bu authoritarian rule, and held in private ownership, and that business colluded with Hitler to manage the economy to boost war production, and generate private profit which is the definition of Capitalism?:

William Manchester in his classic "The Arms of Krupp"
William Shirer in "The Rise and fall of the Third Reich"
Henry Turner in "German Big Business and the Rise of Hitler"
Arthur Schweitzer in "Big Business in the Third Reich"
Eugene Davidson in "The Trial of the Germans"
Daniel Goldhagen in "Hitlers Willing Executioners"

These historians, and chroniclers of the crimes that Schacht and Speer were convicted of at Nuremburg, agree that German policy was to expand trade into the rest of Europe through conquest, which simultaneously served to secure raw materials. Policy was to expand the control of large businesses at the expense of small businesses. Policy was originally highly influenced by Keynsianism: included major investments in infrastructure to reduce unemployment like the Autobahn and a network of airfields; and

Finally, George seems to be obsessed with the idea that Joseph Goebbels had a primary role in running Germany's economy. The person who had primary charge of the German ramp up to war production was not Goebbels, but Hermann Goering, who was the head of the German war production effort that commenced in 1936, forcing Schacht out. If you don't believe me go look it up yourself.

"Why is it so important to George that people believe that the NAZI's were more socialist than fascist?"

I contend that it is really quite simple, George rightly equates the NAZI's with the national personification of evil, which is understandable. He does not want to admit that the national personification of evil is just as likely to occur under a capitalist system as it is under a communist or socialist system. George is so bent on his opposition to socialism and communism, that he wants to equate nazism with them.

Which leads to my next question: how is it possible for a boy to grow up in Tallinn and have a greater affinity for the German system than the Russian system. Well all one has to do is read his personal history, and the history of free estonia which was enabled by the Germans after WWI, to understand. It is a remarkable personal history--and one to be applauded--but it demonstrates that throughout George's life the Russians have been the enemy--when given the choice George's family choose to move west with the Germans as they retreated in front of the Red Army, rather than look east. He is reliving that history every day here, when he tries to paint people's beliefs that he se's as contrary to his own, with the socialist, fascist and communist brush.

I will deal with the authoritarian nature of George's right wing libertarianism in a later post.

Steven Frisch

Actually, I want to slightly modify my statement above, I did not mean to say that the national personification of evil is "just as likely to occur under a capitalist system as a communist or socialist system". I meant to say "just as likely to occur under a fascist system as a communist or socialist system".

I firmly believe that capitalism, by nature of its basic definition of private property, private rights, free association of trade between individuals, and rewarding of private initiative, is inherently more democratic, and thus more just, than any other system yet devised.

George Rebane

SteveF – I believe the comment thread shows that it was you who introduced the notion of a Nazi economic theory invented and implemented by Schacht et al. I maintain my position that in the common view the Nazis had no systematic economic theory – like all totalitarian states, the Nazis knew less about the in/out relationships of an economy than do the more democratic states. Therefore their economic behavior (as opposed to ‘policy’ per se) was reactionary and ad hoc – as was the USSR’s and sort of like ours is now becoming – guided by the overarching ideological objective of Lebensraum. Large economies can be ‘managed’ perfectly well in such a manner, but not sustainably – they all degrade and collapse on their own schedules.

Regarding your frustration of debating on RR, a reader of the local blogs cannot conclude else than that you find the intellectual combat in these pages more than fulfilling – your considerable essays are getting more comprehensive, eclectic, and longer – and therefore you must find their delivery and reception anything but futile. I wish you joy.

Mikey McD

My question to Michael Anderson was Do you think that our taxes (private property taken by force) should go to fund groups like the Chamber of Commerce? Economic Resource Councils? Sierra Business Council?

Restricted or unrestricted does not affect the proverbial gun pointed at my head demanding the tax be paid ("All government funding we receive is restricted to providing a specific purpose.") My question still stands.

Mikey McD

"...evil is just as likely to occur under a capitalist system as it is under a communist or socialist system" = bull fesses.

Steven Frisch

George, it was you who introduced the issue of Nazi economics originally by stating several weeks ago that their policy was 'socialist'. It has rankled me ever since, thus I have brought it up a couple of times.

George Rebane

SteveF – If you include my assertions from several weeks ago about how the Nazis ran their economy, then I stand guilty as charged. I mistakenly thought your references were to my current post and its attendant comment thread.

For newer readers I want to clarify your implication that I am somehow a lone benighted voice here claiming that Nazism was a socialist form of collectivism (before it became a rank dictatorship). In these assertions I am joined by respected thinkers from institutions such as Cato, Heritage, and others, sources which you may consider in ill repute.

A well cited dissertation on fascism may be found in the Wikipedia entry
http://en.wikipedia.org/wiki/Fascism ;

and a comparative analysis ‘Fascism and Socialism’ here

The bottom line of my entire argument is that labeling someone a right winger or conservative/libertarian, and then by continuation arguing that the common ideological tenets of those are just stepping stones to some form of collectivist authoritarianism is patently false. Fascism does not lie on the extreme terminus of conservative/libertarian thought. This position was made fashionable by Lenin, and has been parroted ever since by progressives seeking to find equivalent evil in the background of those promoting decentralized governance that emphasizes individual freedom and responsibility.

I stand with those whose readings of history show that socialistic governance is unsustainable and inevitably deteriorates into totalitarianism – and it does so directly without having to degenerate through any other form of political ideology. On the other hand, true democracies without the protective structure of republicanism also degenerate. But in modern times the ‘progress’ of such degeneration inevitably goes through various experimentations with benign then draconian socialism with its final destination assured.

In all fairness, we have yet to conclusively demonstrate that democratic republicanism based on capitalistic economics and free markets is ultimately stable. But America’s experiment with it did produce a people and nation-state which has been the salutary envy of the world. Now worldwide contempt for America grows, as collectivism and dumbth spreads through our land.

Mikey McD

Now we are getting somewhere... "I firmly believe that capitalism, by nature of its basic definition of private property...". It would be enlightening to read your "basic definition of private property" with specific references to a man's wages.

Will you fall into the "Obama Tax Camp"??: Obama says a lot during this Sept 20 2010 socialist rally on CNBC...about extending Bush’s tax cuts…. “We can’t give $700 billion dollars away to America’s wealthiest people.” Obama believes that the wages and earnings earned by Americans are the property of the government!
I believe: Tax cuts are not giving government money to tax payers, tax cuts allow the tax payer to keep more of THEIR wages and earnings.

George Rebane

Mikey, some progressives also view letting private enterprises keep what they earn as another form of government subsidy. This is to differentiate the other form of unquestionable subsidies that come when government either assures your market(s) and/or directly writes you a check to cover some of your operating costs.

The nationwide situation has become so bad with the collusion of industry groups and government, that it is literally impossible to cut the financial threads of who benefits from what government dispensation. This muddle, of course, has been purposive so that the arguments are never clear and the ratchet always clicks toward more central control, i.e. socialism.

A libertarian solution would be to get government totally out of manipulating the nation's economy. Now there's a concept of Neverland.

Mikey McD

Another collectivist heard from regarding income taxes:

“We just can’t afford that kind of giveaway to the very wealthiest among us,” said Senate Budget Chairman Kent Conrad, a North Dakota Democrat"- TO GIVE AWAY IMPLIES THAT IT IS YOURS TO GIVE. PRIVATE PROPERTY? -http://finance.yahoo.com/news/Senate-Has-Enough-Votes-to-bloomberg-2441278925.html?x=0&sec=topStories&pos=1&asset=&ccode=

Michael Anderson

Mikey wrote: "My question to Michael Anderson was...Do you think that our taxes (private property taken by force) should go to fund groups like the Chamber of Commerce? Economic Resource Councils? Sierra Business Council?"

Private property taken by force? All taxes? What about taxes for roads, police & fire, and national defense?

Once we can agree that to live in a civil society a certain "mandatory tithing" (-; is required to ensure that this society remains civil, then we can talk about the list of things for which those taxes are used. We can't really move forward until we agree that at least some taxes are not "private property taken by force."

Mikey McD

Too many follow up questions will cloud the original question (do the 55% of non federal income tax paying americans use the roads, police & fire, national defense? Why is it only a few that are forced into 'mandatory tithing'?)

In my "Neverland" we would each pay an equal % of our income and we would each get to choose where the funds are directed. For example, if i paid $25,000 in Federal taxes I could apply $10,000 to defense, $10,000 for police & Fire & general justice system and $5,000 for roads/bridges/broadband/general infrastructure. As I awake from my dream the original question remains... at what point can we determine that taxes are being used for bullshit reasons? Do Chambers and SBC's provide sufficient value to require a mandatory tax on my private property?

Michael Anderson

Thanks for the clarification, Mikey. I forgot the original question...as you said, too many follow up questions to keep track of!

Now I see where you are coming from. You don't believe in a progressive income tax, and you also would like to have more say in how the tax dollars you contribute are spent.

First I will list some salient points, and then I will answer your question at the end:

1. The progressive income tax has a long history; taxing a citizen in proportion to her means need not be onerous if enacted fairly and very gradually. If the tax system is complex and unfair, a steep progression will even hasten tax evasion and non-compliance.

2. A citizen will pay his fair share of taxes if he deems the tax system fair and just, and the receipts spent on worthy items. If not, he will evade. Today we have an unfair and unjust tax system at almost every level, and the receipts are spent on unworthy items (though the definition of this varies with each citizen taxpayer). Thus, our citizen evades: if he is rich, he hires fancy tax lawyers to find copious loopholes; if he is poor, he makes sure that he is paid under the table.

3. Our faltering constitutional republic has become corrupt. Since citizens are taxed unfairly and tax receipts are distributed unfairly, trying to investigate specific situations on this blog is probably futile.

4. Unless enough of us are working together for the common good, we will fail. There is a critical mass necessary to effect positive change. I support the idea that Steve F. has posited here, that we can find ways to work together under the 80-20 rule.

OK Mikey, so all that being said, and to answer your question, I am just fine with tax deductions being allowed for the ERC and SBC, and other non-profits that I deem worthy. You are not going to simply, modify, and reform the tax code by hammering on the little bits. This is a Big Picture problem, and needs the same kind of effort that was thrown at health care.

I don't think you can solve the budget deficit problem, or pay down federal/state/local debt, unless you first attack the tax code. The recent deficit commission danced around the edges, but we still have a long way to go.

I think tax reform is Job 1. If we can get that right, all of the other problems will go away, and you won't be asking me about the ERC or SBC.

* If the tax code is fair and just, we don't question our mandatory tithe.

* If the legislative mechanism is fair and just, we don't question how our tax dollars are spent.

Can we agree that the tax code and the legislative mechanism are what needs fixing?

Mikey McD

Well put Michael. Good stuff.

I think it is a necessity to discuss what services fall under the "fair and just" title. Should a man be forced to give his private property to the national Chamber of Commerce? or a Podunk SBC or ERC? or Big Brothers Big Sisters? Where is the line?

I don't see the progressive tax system as anything other than a vote buying scheme pitting the 'labor class' against the 'rich class.' Would a wealthy man not pay considerably more to the treasury if all were taxed at the same rate?

All in all the tax system (read vote buying apparatus) is in need of a total re-boot. Though I am young, I don't see it happening in my lifetime.

Michael Anderson

"Though I am young, I don't see it happening in my lifetime."

When I was young (-;, I used to think the same thing. Now that I'm older, I'm convinced the center will not hold. Strap on your safety belt and keep your powder dry.

George Rebane

Good discourse by the Michaels!

MichaelA,("... the center will not hold.") RR is testimony to that tenet. Too much has happened in the 20th century. The Peter/Paul Principle is a permanent fixture of broad-based governance. The pre-Singularity effect guarantees that more and more will be produced by fewer people. The 'center' has become a revolving door spewing out people to the extremes of collectivism and conservative libertarianism. Seat belts and dry powder indeed.

I have put down my own take on what is required to go forward as a single nation, and it all revolves around redistribution. But as long as the left feels they are pulling their economic weight, in addition to taking by force what they deem justly theirs, the path will definitely involve the Great Divide in one form or another. The alternative is to proceed directly to totalitarianism ('Do not pass GO, do not collect $200.')

Mikey McD

The Great Divide needs to be a discussion at more colleges, dinner tables, water coolers, disc jockeys, op/ed pieces, etc... Thank God that we have the ability to wage war in America without the blood shed once needed for a revolution.

Does a great divide need to include geographic 'boundaries' or will the 'boundaries' naturally evolve? How to propel the discussion forward?

Past generations of Americans built bomb shelters to protect them from foreign enemies ("The Russians are coming!")... I ponder building one to protect me from my fellow americans. Now I know why the soldiers oath includes "I will support and defend the Constitution of the United States against all enemies, FOREIGN AND DOMESTIC."

Steven Frisch

Hey Greg Goodknight what happened to your agreement to put your Nolan chart and answers up here?

Greg Goodknight

Hey Steve Frisch,

I've been busy, but IIRC my proposal was for you, Pelline and I to submit them privately to George, who would reveal all after the submission was complete. Get Jeffy to buy in and I'll be happy to do it.

Steven Frisch

Actually Greg, according to your post on December 6th at 3:19 pm this was the offer:

"My interest is piqued; I'm to the left of Frisch? Fascinating. A cynic might opine that his answers, rather than thoughtful responses, were chosen to generate a desired result.

If George will agree to the role, I'll send my quiz2d *answers* to George, to be released here when Steve Frisch sends in his answers."

No requirement for Mr. Pelline to provide his was included.

Steven Frisch

I see how you are Greg--your word is worth precisely nothing. What a tool.

Sarah H

Frisch, don't forget that it was precisely you who has promised to leave this blog and never return (more than twice). LOL.

Steven Frisch

Hey Sarah, what part of Greg not living up to his side of the bargain and then claiming he never made it do you not get? The direct quote is above. Are you so single minded in your ideology that you cannot even acknowledge the facts when they are right in front of your face?

Steven Frisch

I think I'll just keep moving this up to the top of the comment list until Greg Goodknight explains why he would back out of this little deal? (as a bonus it will continue to annoy Sarah;).

Sarah H

Steven, I was simply pointing out the double standard you live by (I have nothing to gain by seeing Greg's answers and he gave no deadline to deliver on his word). If I figured out how to put my chart up I am sure that Greg and others can too.

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