Follow the Leader

An interesting news item appeared on Newsmax yesterday with the headline, Billionaires Dumping Stocks, Economist Knows Why. In brief the article states that Warren Buffett and other billionaires have no faith in the future of “dyed-in-the-wool” American companies because of recent “disappointing performance.” The rest of the article is an advertisement for an economist who is predicting a large market correction. Such predictions, of course, are the flies of a summer. How can anyone pretend to predict the future?

The political economist Max Weber was, perhaps, best known for writing The Protestant Ethic and the Spirit of Capitalism in which he argued that Puritan ethics influenced the development of market society. Weber wanted to be scientific about economics and the way people deal with uncertainty. To this end Weber wrote Economy and Society, in which he divided social action into four types: (1) instrumentally rational; (2) value-rational; (3) affectual; and (4) traditional or “ingrained habituation.” Of these four kinds of action, we might presume that market prediction falls under “instrumentally-rational action” or “value-rational action.”

Science, for Weber and many other scientists, is about prediction. If you want to understand human economic action you need some kind of comprehensive typology for grasping the factors at work. In economics you cannot explain everything that happens in terms of the individual rationally seeking pecuniary advantage. A great deal depends on irrational factors that are rarely discussed. Such factors are hopelessly intertwined with each other – as in the case of the action produced by Puritanism on the market economy of previous centuries.

Weber was particularly interested in the role that religion played in economic activity. And if Weber were alive today, he would be fascinated to see that irrational beliefs of a non-religious kind are having a profound effect on the economy today. In fact, so strongly held are these irrational beliefs, that we cannot even discuss them without entering into controversy. One must either believe, or be an enemy of belief. No rational discussion can be allowed in such cases. For the true believers are, after all, true believers; and everywhere these believers exist and assert their influence. They tyrannize our thinking and bring about profound economic and social changes in society.

Perhaps the most fascinating aspect of Weber’s Economy and Society is Chapter XIV, “Charisma and Its Transformation.” We must not underestimate this most irrational and mysterious factor in economic and political history. For it is during a great crisis that charismatic leadership typically comes into play. Weber explains it like this: “All extraordinary needs … which transcend the sphere of everyday economic routines, have always been satisfied … on a charismatic basis. The further we go back into history, the more strongly does this statement hold.” In other words, the true charismatic leader appears in times of distress, not in times of peace and prosperity. He appears at the beginning and end of things. He may be described as Christ describes himself in the Book of Revelation, “I am the Alpha and Omega, the beginning and the ending … which is, and which was, and which is to come, the Almighty.”

The “natural” leader, the charismatic leader, appears as if Providence had summoned him. He speaks as if he has authority from a higher source. Such leaders, wrote Weber, “[are] neither appointed officeholders nor ‘professionals’ in the present-day sense, but rather the bearers of specific gifts of body and mind that were considered ‘supernatural.’” The charismatic leader seems to be channeling something that comes from a “higher” source. When the charismatic leader speaks, people are mesmerized or fascinated by his inspired fervor. They might even feel they are hearing the Word of God.

We must not be constricted, says Weber, with a strictly religious notion of charisma. In an increasingly secular world, where politics has replaced religion, the “charismatic” leader might be a magnetic speaker who hypnotizes the masses while seeming to drift in and out of a religious kind of ecstasy. Setting aside frauds and circus acts, Weber suggests that such leadership is real and has a profound impact wherever it appears. In the complex society of today there might be charismatic leaders in many walks of life, even in corporations. Consider the almost divinely inspired genius of Thomas Edison or Nikola Tesla. Both these figures engaged in work that transformed the world economy. We might ask ourselves: Where did they receive their extraordinary inspiration from?

It is interesting to note that the word “genius” comes from the Latin word genii, which refers to the tutelary deities of a person, family or place. Does anyone seriously think that creative inspiration is rational? Or is it mystical? And is not the economy, in large part, driven by creative inspiration? In fact we do not know what invention, what scientific discovery, may next overturn all our economic expectations (whether optimistic or pessimistic). Consider the economic consequences of the computer or smartphone on which you are reading this article. Thirty years ago these products (in current form) didn’t exist. What will exist thirty years from now? Perhaps there will be massive undreamt of prosperity. On the other hand, there may be nothing but rubble and destitution. At this juncture, we simply cannot picture the future with any certainty; for many possibilities lie open to us. Given the creative and charismatic forces unleashed by the global economy, there is no set future, no longer a discernible pattern, and no past with which to compare the present day.

Charisma, says Weber, is a revolutionary force in both society and economy. This is because the charismatic leader creates a new dispensation by laying down a new law, or by instigating a new mode of life “for the sake of glorifying a genuine prophetic and heroic ethos.” People are therefore inspired by the story of Nikola Tesla or Edison, or even by billionaires who have made their money through a process of thought that simply eludes routine number-crunching and common sense. And yes, even billionaires can be charismatic leaders.

Perhaps the uninspired majority need to follow someone. The problem for investors, as with most followers, is a problem of discernment. Which financial prophet has the gift of grace? Which has genuine charisma, genuine inspiration? And are we correct to think that extraordinary people possess an extraordinary understanding which explains their achievements? And if charisma is real, as Weber asserts, is it a permanent possession or something temporary? Certainly we cannot deny that Joan of Arc was an example of charismatic leadership, although her “voices” abandoned her prior to being burned as a witch. So even if we could recognize a genuinely inspired financial leader, how can we be sure he hasn’t suddenly lost his grace in the manner of Joan of Arc?

The wellspring of human creativity is from the soul, and the soul must remain a mystery. It is perhaps true that science is no better at predicting human action than shamanism. And so we are left to follow our own analysis of the economy or someone else’s. But who, in truth, follows their own analysis? Even our inspirations may ultimately come from outside ourselves (that is, if our inspirations are “genuine”).

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on July 15, 2013. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

The Terrorrist Puzzle

Terrorists have killed American citizens once again. The chief suspects are listed as Tamerlan and Dzhokhar Tsarnaev, brothers aged 26 and 19 respectively. They are Muslims from Russia who, according to authorities, detonated two bombs near the finish line of the Boston Marathon on Monday, 15 April. President Barack Obama said that whoever did the bombing will “feel the full weight of justice.” Since that statement Boston police have killed Tamerlan and captured Dzhokhar.

An air of controversy is building about the suspects, even now. An “Op-Edge” analysis piece published by Russia Today claims “that very little clarity surrounds the case.” There are questions as to how the surviving suspect, 19-year-old Dzhokhar, “could walk out of the boat he was hiding in … with a throat wound that he is now almost dying from.” Russia’s official media says the suspects originated from Kyrgyzstan, in the town of Tormok, which is ethnically Chechen. Back in Russia, the father of the accused brothers says that his sons are being framed.

According to Judicial Watch’s Corruption Chronicles of April 22, Tamerlan Tsarnaev, was arrested and possibly convicted for domestic violence in 2009. According to a Judicial Watch source, the Obama administration could have deported Tamerlan “but evidently didn’t feel he represented a big enough threat.” Years ago, we read, “Judicial Watch uncovered critical intelligence documents detailing Al Qaeda’s activities in Chechnya, including the creation of a 1995 camp – ordered by Osama bin Laden – to train ‘international terrorists’ to carry out plots against Americans and westerners.”

The Russian twist on the alleged Boston bombers is especially interesting because this same training camp in Dagestan was mentioned by Russian KGB/FSB defector Alexander Litvinenko, who said it was a KGB/FSB-sponsored camp for training terrorist agents and Al Qaeda leaders, including Ayman al-Zawahri (who was referred to by Litvinenko as a longtime KGB agent). Following his revelations of the KGB’s involvement in training top Al Qaeda leaders, Litvinenko was poisoned with polonium-210 in November 2006. During an interview with FrontPagMag’s Jamie Glazov, a friend of Litvinenko explained, “Alexander revealed … that at least two notorious Al Qaeda terrorists are secret agents of the FSB….” Stroilov went on to say, “Contrary to the view of many in the US, Russia is anything but a reliable ally of yours in the ‘war on terror.’ The Kremlin is playing a treacherous double game: while enjoying the West’s support as an ally, it secretly supports and manipulates Al Qaeda through FSB agents of influence.”

In keeping with this theme, The Long War Journal has published a piece titled “Dagestani jihadist group issues statement on Boston bombings.” According to Vilyat Dagestan, an Islamic militant organization in Russia, “we are at war with Russia” and “not fighting against the United States of America.” Therefore, an attack by ethnic Chechens on the United States makes no sense whatsoever. If Americans want to discover the real organizers of the Boston explosions, argued the Vilyat Dagestan, “they should focus on the involvement of the Russian special services in the event.”

Quite naturally, U.S. officials have only just begun to investigate the Tsarnaev brothers and their Dagestan/Russian connections. It has been reported by NBC 4 New York that Tamerlan Tsarnaev “left New York on Jan. 12, 2012 for Sheremetyevo, Russia. He stayed overseas and returned to JFK [airport] on July 17.” What was the trip to Russia about? Why did the trip last six months, and who was Tamerlan with? Were the Tsarnaev brothers motivated by Islam? Or was there some other purpose?

Journalists are currently focused on the brother’s online activities. Time Magazine alleges that Tamerlan “appears to have created a channel on YouTube [click here] called Terrorists.” On this Website Tamerlan supposedly inserted a video of a Dagestani insurgent leader who says, “Jihad is the duty of every able-bodied Muslim.”

There are many angles to this case, but of special interest is Moscow’s attempt to warn the United States about Tamerlan Tsarnaev. Readers are encouraged to study the April 19 National Press Release of the FBI, which states: “Once the FBI learned the identities of the two brothers today, the FBI reviewed its records and determined that in early 2011, a foreign government asked the FBI for information about Tamerlan Tsarnaev. The request stated that it was based on information that he was a follower of radical Islam and a strong believer….” The FBI subsequently checked U.S. government databases, examined Tamerlan’s Internet activity, and interviewed Tamerlan along with unnamed “family members.” No evidence of “terrorism activity” was found.

It is possible the Tsarnaev brothers were two sadly confused young men, drawn to radical religious beliefs and violent jihadist activities. That seems the most obvious explanation. But where Russia is concerned investigators should be vigilant. Russia is a country of many mysteries, of real false flag terrorist operations like the Russian apartment bombings of September 1999. Nothing is straightforward where Russia is concerned.

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on April 22, 2013. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

Will the DPRK Strike?

Ayear ago this month the Democratic People’s Republic of Korea (DPRK) vowed to “reduce all the rat-like groups [in the Republic of Korea] … to ashes in three or four minutes … by unprecedented peculiar means and methods….” In response to this, South Korean (ROK) officials urged the DPRK “to immediately stop” the practice of issuing threats. Such threats, they said, only serve to increase tensions. But, of course, that is the North Korean game. The DPRK issues threats to increase tensions in order to receive payment for agreeing to decrease tensions later on. It is a very simple system of extortion, and it was once effective. Only now, the threatened parties are not responding with cash. Instead, they have been responding with their own military moves. This sudden change from appeasement to exasperation has led to a crisis.

Last Thursday the DPRK issued an official statement blaming “the U.S. imperialists” for violating the sovereignty of the DPRK. As the situation was “extremely grave,” Marshal Kim Jong Un, “brilliant commander of Mt. Paektu, convened an urgent operational meeting on the performance of … the Strategic Rocket Forces of the Korean People’s Army … to ratify a firepower strike plan.” Marshal Kim had reportedly declared a “do-or-die battle … for putting an end to the history of the long-standing showdown with the U.S. and opening a new era.” The decision, quite naturally, reflected “the strong will of the army and the people of the DPRK to annihilate the enemy.” According to the statement, DPRK servicemen were “surging with anger” against the many reckless imperialist provocations – which include: making B-52 sorties into South Korean airspace; and flying B-2A stealth strategic bombers and other strike craft from the U.S. mainland to Korea as part of a bombing drill. “This is an unpardonable and heinous provocation and an open challenge,” noted the official DPRK statement. “By taking advantage of the U.S. reckless campaign for a nuclear war against the DPRK, the south Korean puppets vociferated about ‘preemptive attack’ and ‘strong counter-action’ … openly revealing their threat to destroy symbolic monuments to the dignity of the DPRK’s supreme leadership.”

Presenting itself as a parody of wild-eyed paranoia, and epitomizing the projection of the DPRK’s own hostile intentions, Pyongyang further accused the United States of “brigandish ambition for aggression” and also accused the South Korean “puppets” of attempting to invade the DPRK. Consequently, “their threats have entered the reckless phase of an actual war from the phase of threat and blackmail.” Therefore it was right and just, according to the DPRK statement, “that the Supreme Command of the KPA [Korean People’s Army] … made the decision to decisively settle accounts with the U.S. imperialists and south Korean puppets by dint of the arms of Military-First politics (So’ngun), because the time when words could work has passed.”

It must be admitted that the DPRK statement doesn’t sound like a blackmail threat. It sounds more like the statement of someone who has swallowed a lifetime of distorted propaganda about the United States and “the south Korean puppets.” In truth, the DPRK statement comes from a deluded leader who is so crazy (by the standards of the outside world) that intelligent observers are left shaking their heads. For what country in the whole history of the world has ever presented an official statement of this kind?

Consider the following section of the DPRK statement: “It is the resolute answer of the DPRK and its steadfast stand to counter the nuclear blackmail of the U.S. imperialists with merciless nuclear attack and … all-out war. They should clearly know that in the era of Marshal Kim Jong Un, the greatest-ever commander, all things are different from what they used to be in the past. The hostile forces will clearly realize the iron will, matchless grit and extraordinary mettle of the brilliant commander of Mt. Peaktu that the earth cannot exist without Military-First (So’ngun) Korea. The time has come to stage a do-or-die final battle.”

It should be pointed out that military geniuses don’t issue official statements in which they describe themselves as military geniuses full of “matchless grit and extraordinary mettle.” To make a statement of this kind, when one has never fought a war, is to announce one’s own ignorance and egotistical self-regard. It is, in fact, the confession of a clown with his finger on the nuclear button. Pundits in the U.S. are not alarmed, of course. They are cool and calm, believing that the DPRK won’t do anything to harm its own “self-interest.” Unfortunately, self-interest is in the eye of the beholder. In this regard, one must consider the self-interest of a clown who doesn’t even know he is a clown. Even worse, this clown is surrounded by lackeys who are incapable of forestalling his behavior. For how else can we explain the DPRK statement, which continues thus: “It is self-evident that any military conflict on the Korean Peninsula is bound to lead to an all-out war, a nuclear war…. The first strike of the revolutionary armed forces of the DPRK will blow up the U.S. bases for aggression on its mainland in the Pacific operational theatres including Hawaii and Guam and reduce not only its military bases in south Korea but the puppets’ ruling institutions….”

Psychological projection is not some academic myth, but a very real affliction – the same affliction that led Hitler to blame the Jews for starting World War II. In the same sense Kim Jong Un blames the United States for World War III. He believes the United States is an “imperialist aggressor.” Therefore, in the present context, he is not bluffing. He is telling us what he actually thinks.

Officials in the U.S. government seem to appreciate Kim’s actual state of mind. They have studied the DPRK statement and know they are dealing with a deluded person. It is now the aim of U.S. policy to react slowly and coolly to the Korean situation. Specifically, the United States is backing off harsh statements and obvious military demonstrations. This is not to be mistaken for appeasement. It is a more careful policy of avoiding an unnecessary conflict when tensions are at a fever pitch. It is in the best tradition of peace-making, provided it does not return to the policy of sending more cash to the failed regime in Pyongyang.

And yes, the situation is dangerous precisely because the DPRK is a failed state in possession of nuclear weapons. Its leader is a megalomaniac surrounded by lackeys who rule over a starving population and a desperately precarious economy. Given this situation, all you need is a border incident. All you need is an artillery engagement in the DMZ. One of a thousand things could go wrong and we could find ourselves in a nuclear war.

In reality, war is not always the product of careful calculation. It is more often the result of accident, miscalculation and misperception. If a major decision-maker is deluded, crazy or stupid, there is a good chance he’ll get himself into a war. And so, we should not be dismissive of the danger.

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on Feb 18, 2011. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

Threatening Noises from North Korea

The Voice of America headline reads, “North Korea threatens Japan with Attack.” Another headline reads, “US to increase missile defense as North Korea threatens strikes.” We learn about Defense Secretary Chuck Hagel’s announcement of the planned installation of 14 land-based missile interceptors in Alaska by 2017. Elsewhere we read about a North Korean military leader threatening a preemptive nuclear strike against the United States (see video links at “Is War Brewing on the Korean Penninsula?”). We also see chilling video footage of the young North Korean dictator telling military officers, “Throw all enemies in the caldron, break their waists and crack their windpipes.”

Such has always been the rhetorical style of the North Korean regime. For the last 15 years North Korea has been promising to engulf South Korea in a “sea of flame” while threatening the United States with inevitable nuclear destruction. The North Korean government has gotten a lot of attention, and has won aid in the past by alternating threats with the promise of peace. The greater the threats, the greater the harvest when the prospect of peace is held out. In fact, it is an old game. Yet one may ask if one day a North Korean princeling, deluded with power, will take his own rhetoric seriously. At what point does rhetorical style transform itself into calamity?

North Korea is a socialist country of a different type. It has remained hardline and Spartan in its determination to confront the capitalist enemy, with a huge army and massive missile forces. And as everyone knows, a war on the Korean Peninsula would have devastating economic repercussions for Asia and the Pacific. While America worries whether North Korea has missiles capable of hitting U.S. cities, the Japanese and South Koreans are left in no doubt. A North Korean missile can hit Tokyo with a biological or nuclear warhead at any time.

What is the source of North Korean militancy?

The ideology of North Korea was originally Marxist-Leninist and consistent with that of the Soviet Union and China. In 1972 the ideology was officially changed to something called “the Juche idea,” first set forth in the 1950s by the founding dictator of North Korea, Kim Il-sung. The ideology proposes military strength and national self-reliance. Juche has its roots in Stalin’s idea of “socialism in one country” combined with Mao’s principle of “regeneration through one’s own efforts.” Since man is the master of all things, North Korea might well take an independent stand against imperialism and capitalism. Of course, this stand isn’t truly independent because North Korea has always received its weapons from China with occasional economic or technical support from Russia. The regime has also used threats (including the threat to build a nuclear weapon) to get economic assistance, money and food from the United States and South Korea. Perhaps it is mistakenly attempting to use the threat of nuclear war to for a similar purpose today.

North Korea is one of the world’s poorest countries despite possessing a large and powerful military machine. Making economic isolation and autarchy into a virtue, the North Korean economy has withered. In the 1980s the government pushed a program to produce ten million tons of grain per year. To their dismay, they only produced four million tons. (It is estimated that six million tons are required to feed the North Korean people.) Nevertheless, North Korea has managed to create an enormous army with over 153 divisions and brigades, including 60 infantry divisions/brigades, 25 mechanized brigades, 13 tank brigades, 25 special Operation Force brigades, and 30 artillery brigades.

When a country only has weapons, and little else, what do you suppose its policy relies upon? Threats come naturally. The entire psychology of the country’s leadership is alien to peaceful pursuits. It is, indeed, oriented toward war. And if war is impractical for the moment, then the orientation is toward the threat of war. The most natural thing in the world, therefore, is that North Korea’s leaders should issue dire threats. As for the question of whether they are bluffing, the answer should really be placed in reverse. Are the South Korean, Japanese and Americans bluffing in their commitment to resist North Korea? And furthermore, are they willing to purchase peace for a price? If so, the North Koreans will sniff them out. And another thing is certain: The North Koreans will attack if and when their opponents weaken. Let no one be mistaken on that score.

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on March 18, 2013. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

The Four Reformers

In The Four Reformers, by Robert Louis Stevenson, a meeting takes place under a bramble bush where four conspirators talk about remaking the world. The first says, “We must abolish property.” The second says, “We must abolish marriage.” The third says, “We must abolish God.” The fourth wants to abolish work, and falls silent. The first then admonishes his comrades to a practical expedient; namely, reduce all men to “a common level.” The second says, “Let us give freedom to the sexes.” The third says, “Let us find out how to do it.” The first says, “Let us abolish the Bible.” The second says, “Let us abolish the laws.” The third says, “Let us abolish mankind.”

And how is mankind abolished? As the science of extermination entered its first experimental phase, there came into existence the extermination camps of the Nazis, the Gulag Archipelago of the Soviets, and the Laodong Gaizao (reform through labor) of the Chinese Communists. But now, with the advent of nuclear, biological and seismic weapons (not to mention weaponized nanotechnology), the abolition of what Nietzsche called “the many-too-many” becomes a distinct possibility.  And so the four reformers of Stevenson’s story pave the way with feminism, atheism, legal nihilism, and Darwinism (setting the stage for the abolition of property – as a necessary precondition).

It was F.A. Hayek who pointed out, in The Road to Serfdom (1944), that with the rise of destructive totalitarianism mankind had fallen into decline. Hayek explained: “We have progressively abandoned that freedom in economic affairs without which personal and political freedom has never existed in the past. Although we had been warned by some of the greatest political thinkers of the nineteenth century, by Tocqueville and Lord Acton, that socialism means slavery, we have steadily moved in the direction of socialism.”

Hayek pointed out that the ideas behind National Socialism (Germany) and Soviet Socialism (Russia) represented a total break “not only with the recent past but with the whole evolution of Western civilization….” It is not merely a break with Adam Smith, Hume, Lock and Milton; but a break with “the foundations laid by Christianity and the Greeks and Romans. Not merely nineteenth and eighteenth century liberalism, but the basic individualism inherited by us from Erasmus and Montaigne, from Cicero and Tacitus, Pericles and Thucydides….”

Merely raise a generation that has little or no contact with classic antiquity – with those great men who taught us how to think, how to value the life of the mind, how to nurture the spirit of free inquiry and thought – and you have cut the tree of civilization from its roots. To accomplish this, you launch an attack against the past. The way to do this was described in Richard M. Weaver ‘s essay, “On Setting the Clock Right.” According to Weaver: “If one remarks that … collectivism is fatal to individual liberty, one is blamed for being out of step with the times. If one hazards an opinion that the amount of noise and confusion prevailing today is perhaps not the best thing for the human psyche, one is branded an enemy of progress.” Those who conspire to cut us out of the fabric into which we were woven by historical circumstance, tell us that we cannot turn the clock back. Richard Weaver sweeps this aside by explaining that the past is real and substantial, while the future is unreal. “The past exists in the form of history,” declared Weaver; “it is something we in a sense possess, something we can examine and appraise.” The future does not exist in the same way. We cannot appraise it, though we may realize through study of the past that there is “nothing new under the sun,” and finding ourselves in context, understand our place in history.

But once you take history away, no understanding is possible. Once history has been severed, and we no longer look back, we become vulnerable to the most elementary errors. Stevenson’s four reformers are empowered whenever history is forgotten or set aside. This is because historical knowledge inoculates society against the four reformers. But ignorance of history allows them to advance from one destructive absurdity to another. For example, consider the recent heroic status assigned by the four reformers to homosexuality (along with the irresistible campaign for the legal recognition of homosexual marriage). Today the four reformers have succeeded so well, that few would dare to defend the old view, which can only be dug out of the ashcan of history from a burnt fragment. One such fragment would be Johann David Michaelis’s Commentaries on the Laws of Moses, where it says: “If we reflect on the dreadful consequences of sodomy … we cannot … consider the punishment as too severe. For if it once begins to prevail, not only will boys be easily corrupted by adults, but also by other boys; nor will it ever cease; more especially as it must thus soon lose all its shamefulness and infamy and become fashionable and the national taste; and then … national weakness, for which all remedies are ineffectual … not perhaps in the first generation, but certainly in the course of the third or fourth…. To these evils may be added yet another, viz. that the constitutions of those men who submit to this degradation are, if not always, yet very often, totally destroyed, though in a different way from what is the result of whoredom.”

It is, of course, swimming against the tide to read aloud from books that will soon be outlawed as “hate speech.” Historical memory being corrupted, our discourse disconnected from our forefathers, we are as ready to burn old books of wisdom as were the Nazis. And then, under a totalitarian parade of tolerance, so artfully conceived by the four reformers, one discovers a new intolerance. Animated by intensive hatred for tradition, law and civilization, the new intolerance is aimed at those who nurtured us through the centuries, who prepared the way for our existence. Here is the project of the four reformers: to destroy the foundation of civilized life, despite the fact that the reformers exist upon that same foundation. In their suicidal campaign, it is imperative to punish or intimidate all those who reflect upon the requirements of human procreation, of the breeding of healthy human beings in a way that preserves a path forward (i.e., through successful generations of children brought up to perform their duty in that great chain of being without which human life would disappear altogether). According to Johann David Michaelis, “Whoever, therefore, wishes to ruin a nation, has only to get this vice [sodomy] introduced; for it is extremely difficult to extirpate it where it has once taken root because it can be propagated with much secrecy … and when we perceive that it has once got a footing in any country, however powerful and flourishing, we may venture as politicians to predict that the foundation of its future decline is laid and that after some hundred years it will no longer be the same … powerful country it is at the present.”

If Sodomy was once shameful, and now becomes the “national taste,” what has become of shame? In his book, Civilization and Its Enemies: The Next Stage of History, Lee Harris asked: “What makes the difference between Happy Lands and Not So Happy Lands?” According to Harris, you cannot build a free society without shame. “Shame is a force superior to reason,” wrote Harris, “because it is rooted in the deepest of our fears – the fear of being abandoned.” Therefore, if you want to abolish freedom then you must abolish shame. “It is through shame,” noted Harris, “that we develop the tendency to treat other people decently, and with fairness….”  Every religion, every successful society, has recognized this fact. The four reformers must add shame to their list of things to be abolished. And while they’re at it, Hell must be abolished since Hell is the place of exile from God. According to Peter Hitchens, in The Abolition of Britain, “Hell was abolished around the same time that abortion was legalized and the death penalty was done away with.” If you are going to eliminate shame you might as well eliminate Hell. After all, you are on the road to making the entire world into Hell. So actual Hell becomes redundant. In this way, as a bonus, you simultaneously abolish the Church. As Hitchens observed, “Like many of the other great British or English institutions, the Church had good reason to feel it was no longer as ‘relevant’ as it had been. It depended upon stable  families and lasting marriages to pass on its faith and traditions, which few would learn outside the home, or without parental pressure and guidance.”

So many things to abolish, so little time. As a matter of course, the four reformers must attempt to abolish war. But this is pure mockery. Such things as stupidity, poverty and war cannot be abolished. So what is the reason for putting forward so many arms control agreements and UN resolutions? It is not to abolish violence, but to break down those national structures which prevent violence, and thereby preserve law and order and property (which the reformers hate).

If I were to update Robert Louis Stevenson’s story of The Four Reformers, looking back at their accomplishments to date, I would record their most recent meeting as follows:

“We have not abolished property, but we have inspired envious hatred against those who hold property,” said one.

“We have not abolished marriage, but we have made divorce so easy that marriage can no longer bind man and woman together,” said the second.

“We have not abolished God, but we have corrupted the Church with a false idea of God,” said the third.

“I wished we could abolish work, and now the welfare state makes work superfluous,” said the fourth.

“We have been practical in our politics,” noted the first, “since we have reduced all men to a common level.”

The second bragged, “We have degraded them sexually.”

The third smiled, “We know how to spread all forms of degradation.”

The first added, “We have replaced the Bible with television.”

The third said, “We may yet abolish man.”

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published at on April 22, 2011. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

Pauperization by the Courts

Karl Marx once taught that capitalism would inevitably collapse because of widespread pauperization, a process by which increasing numbers of people would be left without subsistence by a ruthless market system. But Marx was mistaken. Capitalism has not resulted in progressive pauperization. It is government interference with the private sphere that results in pauperization. And there is no better example than the ruthless tyranny of our divorce courts.

More than any other factor, poverty is a function of the single parent household. Centers of sociological research, such as the University of Washington West Coast Poverty Center say that changes “in the structure of families over the past 40 years has likely contributed to higher poverty rates.” It seems that poverty is on the rise primarily because the two-parent household is in decline, and we shouldn’t be surprised to find that the state is implicated in this decline.

According to the U.S. Census Bureau (2009), the median income of two-parent families was $71,830 while the median income of male single-parent-families was $48,084 and female single-parent-families was $32,597. Since the family may be considered the most basic economic unit, and once was the center of economic activity in an era characterized by family-owned farms and businesses, then we might ask what has caused the erosion of the family. We might also ask about the prospects of further erosion and its implications for economic freedom as well as national prosperity; for as the United States has suffered an erosion of family, it has also suffered an unremarked economic and sociological demoralization – especially as the state has aggressively stepped in to “rescue” a growing number of single mothers.

To clarify the issue, I interviewed Professor Stephen Baskerville, author of a remarkable book titled Taken Into Custody: The War Against Fathers, Marriage, and the Family. According to Baskerville, today’s pauperization is not simply a case of impoverished mothers with children. Fathers are also being impoverished by the divorce system. “To the question of why so many ejected fathers are unemployed or penurious, this is not difficult to answer once one understands how the courts operate,” says Baskerville. “Once the children are separated from their fathers, neither the courts nor the bureaucracy have much incentive to ensure his continued solvency – indeed, a solvent father is a threat – so they can happily reduce him to penury. After all, a fresh supply of fathers is constantly being brought into the system.”

I asked Baskerville whether the issue wasn’t about deadbeat dads who refuse to support their children. Baskerville replied: “The stereotype of the deadbeat dad is almost entirely feminist propaganda. Most of these fathers have not abandoned their children. They have had their children stolen from them by the family courts.” Baskerville paints a picture of judicial and legal corruption where, typically, the father is ordered out of the home and becomes homeless. If the father refuses to spend large amounts of money on an expensive lawyer he is penalized with unreasonably high child support payments. It is a case of plunder, only it occurs under the color of law.

“A father can be ordered by a court to pay 70 percent, 80 percent or 90 percent … of his income in child support,” noted Baskerville. And if these fathers fall into debt and cannot pay, they are summarily jailed. “We have cases of fathers being jailed for up to ten years without trial,” said Baskerville. “And there is almost never a jury trial in cases of child support. The application of the law varies by jurisdiction…. What is especially dangerous about child support is not that the fathers have to pay astounding amounts…. It is effectively bribing the mother to divorce. What she gets out of this is tax free income. She gets a windfall, a tax-free windfall. In other words, you can raise your children as you choose and get paid for it.”

The breakdown of the family is thereby encouraged by a system that rewards one party and plunders another, bringing a great deal of business to lawyers. “It’s a massive problem,” says Baskerville, “involving 24 to 25 million children. And it is not surprising that the vast majority of divorces are filed by women. The usual reason is that the woman says she doesn’t feel loved.” What follows is something called “unilateral divorce.” Under this system marriage is not an enforceable contract even though the United States Constitution says that states cannot pass laws that abrogate the enforcement of contracts. The legal, sociological and economic implications are staggering. Marriage is now a contract that can be broken by either party on a whim, and the faithful party is subject to financial loss at the hands of the party that breaks the contract, with the help of lawyers and judges.

Is not contract law the basis of our economy? As the family unit is an economic unit, we cannot understate the opportunities for “legalized” robbery this presents. “They have opened the floodgates of plunder,” says Baskerville. “The woman has been empowered in alliance with the state … and the father is alone on the other side…. And yes, it does happen that a man who knows how to play the system can plunder the woman as well.” Thus marriage now comes to resemble game theory’s famous “Prisoner’s Dilemma,” in which the first party to break faith is the winner.

According to Baskerville there is a movement afoot that encourages women to accuse their husbands of domestic violence, even if none is taking place, and such accusations are part of a formula – taken as a means to an end. In these matters there is little to be said for due process. In practical terms it doesn’t exist. “Any man who marries is vulnerable to this action,” says Baskerville. And then the courts themselves are arbitrary: “Courts also do not hesitate to summon fathers so often that they lose their jobs and then jail them for being unemployed. It is not unusual for a father to be summoned to court hundreds of times.”

Under this system all wives are effectively married to the state, and all children are wards of the state even as every man is merely a guest in his own home – subject to immediate eviction at any time without due process of law. “The most direct threat to the family today is the divorce courts,” says Baskerville. They encourage divorce, which is overwhelmingly initiated by women, and “it is a formula for huge earnings for lawyers.” Furthermore, he says, nobody is fighting for fathers’ rights because “people don’t want to acknowledge something so big and evil is going on.”

In closing, Baskerville wants us to be honest. “If we truly believe our present divorce policy is appropriate, we should at least have the honesty to tell young people up front that marriage provides them with no protection against government seizure of their children and everything else they have. Let us inform them at the time of their marriage that even if they remain faithful to their vows, they can lose their children, their home, their savings and future earnings, their freedom, and even their lives.”

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on October 22, 2012. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

The Road to Serfdom in Venezuela

For the past thirteen years Venezuela has been moving away from a market economy towards a socialist economy under the leadership of Hugo Chavez. And now the future of Venezuelan socialism hangs in the balance. Or does it? A few days ago I spoke with Eric Ekvall, an American political consultant who has lived and worked in Venezuela since that country’s 1982 presidential election. Ekvall has helped with the election campaigns of such notables as Venezuela’s Jaime Ramón Lusinchi in 1983, Costa Rica’s Oscar Arias in 1985, and Brazil’s Lula da Silva in 1993. I asked Ekvall about the ongoing re-election bid of Venezuela’s ailing Hugo Chavez, especially as President Chavez has been in power for thirteen years and continues to build socialism there. Given the downgrading of the country’s economy, how could Chavez possibly expect to win yet another election?

The answer, according to Ekvall, is that Chavez cheats. “The first election we know he fixed was in 2004.” Ekvall explained. “One fifth of the population basically signed a petition to put a recall referendum on the ballot. This was delayed and delayed and the government used all kinds of mechanisms to push this back long enough for them to be able to purchase millions of dollars of electronic voting machines which had never been used in Venezuela before; we [in Venezuela] have always done paper balloting like most countries in the world…”

The significance of the electronic voting machines will be apparent to any who remember Stalin’s words from 1923: “I consider it completely unimportant who in the party will vote, or how; but what is extraordinarily important is this – who will count the votes, and how.” The quote comes from The Memoirs of the Former Secretary of Stalin, written by Boris Bazhanov after his defection in 1928. It is one of the earliest accounts of Soviet-style political methods, showing how power may be consolidated by a dictator. According to Ekvall, Chavez’s government was also “told by their Cuban advisors to rush in a series of major welfare programs: free education programs, free food programs, appealing to lower income people to boost their sagging popularity ratings.” And how well did this work?

According to Ekvall, “Come August of 2004 the recall referendum took place … and about 75 percent of the registered voters turned out to vote and there was euphoria in the streets … that [President Chavez’s] mandate was going to be revoked …. Veteran political pollsters from the U.S. showed that the recall referendum passed 59 to 41, but to everybody’s surprise the government official figures came out 59 to 41 – but as a loss, and this raised a hue and cry among opposition politicians who basically called ‘fraud’ on the election process.” Over the years social scientists have studied the Venezuelan election of 2004, showing that 22.5 percent of the ballots had been modified. Last year six studies appeared in Statistical Science, confirming the earlier studies. In fact, there is overwhelming evidence that Chavez has falsified the results of every Venezuelan election since 2004.

And now, eight years later, Chavez’s popularity has continued to fall. To counter this, an increasing number of Venezuelans have been put on the dole – to no avail. As Stalin also said, “Gratitude is a sickness suffered by dogs.” Unfortunately for Chavez, the Venezuelan people are not dogs. “According to reliable polls,” noted Ekvall, “opposition candidateHenrique Capriles is ahead; so we have a very tense situation in Venezuela right now.” Capriles is an attractive, likable candidate – a political “rock star,” according to Ekvall. “Chavez is literally on the ropes.” – So how does Chavez get away with stealing the election this time? Will straightforward electronic vote fraud do the trick?

“This time, this year the government has come up with … a ‘hide in plain sight’ approach to vote fraud,” said Ekvall. “The vote fraud … is right in the polling booth. When you go in and vote in the elections this time, you are going to be confronted by an array of technology the likes of which no voter anywhere in the world has ever seen. First of all, you are going to have to punch into an interactive biometric apparatus, and punch in your national I.D. number, and then put your thumb print over a scanner … and your name will pop up … and you will be told that you can move two feet to the right, where there’s an electronic voting machine, and you can cast your vote with a touch-screen machine.”

And how does this translate into fraud? Ekvall replied: “The not-very-subtle aspect of this system is that the biometric system is visibly hooked up by a cable to the voting machine, giving rise to legitimate concerns that your vote is not going to be secret.”

The significance of secret balloting in a welfare state may be understood from recent Venezuelan history, Ekvall underscored. “During the petition drive in 2004 the government got the names of all five million people who signed the petition. They were immediately placed on a black list. “And five million people found themselves … at a disadvantage when it came to welfare credits, jobs from the government, when it came to loans, student loans, anything. If you had signed the petition to recall the president you were automatically a second class citizen. Some people have called this Venezuela’s ‘Political Apartheid.’”

Here is a slick way of intimidating voters. According to Ekvall, “People have every reason to fear….” Here is a country where the welfare state is used as a carrot, but only for those who consistently support the government. If readers wish to understand what socialism signifies, and whether socialism is consistent with liberty, they should study the Venezuelan election process. Not only have the socialists ruined Venezuela’s economy, the socialists have corrupted the voting system and the voters themselves.

Will Venezuela free itself from socialism in next month’s elections? Nobody knows for sure, but Ekvall is worried. And for the rest of us, Venezuela is not the only country on the road to serfdom.

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on September 24, 2012. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.

Eastern Europe’s Market System and the Changes of 1989

AAfter 1989, when the Communist world began to crumble, the old neo-Stalinist economic system of Eastern Europe was subjected to reforms. The quality of economic reform varied from country to country as the rule of law was unevenly established throughout. While it is true that many economies of Eastern Europe moved away from all-pervasive government controls, most East European market economies have remained in the hands of former apparatchiks, criminal mafias and “former” secret police officials. Thus, economic freedom did not take hold throughout the region.

Why were the market reforms in Eastern Europe disappointing on so many levels? “It is not what people think,” says filmmaker Robert Buchar, who has released his long-awaited documentary The Collapse of Communism: The Untold Story. I spoke with Buchar [click here for audio version] about his documentary to ask what he learned from interviewing key participants in the events of 1989, including CIA director Robert Gates. One of the more interesting tidbits came from Buchar’s attempt to interview one of the top Czechoslovak Communist Party leaders in 1989, Rudolf Hegenbart, who refused to say anything on the record. “Havel’s people warned me not to speak, or I would end up at the bottom of the lake,” Hegenbart told Buchar. Afterward, Buchar sent Hegenbart a copy of his book (based on the documentary) which shows how the changes in Eastern Europe were deceptive and misunderstood, especially in the West. “Yeah, you are right pretty much in everything that is in that book. We were taught all of this in Moscow when we were studying there,” Hegenbart admitted.

Buchar was born in communist Czechoslovakia and currently teaches at Columbia College in Chicago where he is head of the faculty’s cinematography program. “I was from a bourgeois family,” Buchar explained, “as my father was an entrepreneur. He had his own company and employed sixty people.” Of course, entrepreneurs were criminals under the old communist regime and the sons of entrepreneurs were denied opportunity. Buchar went from his home town to Prague where people didn’t know his background. “I got into a school in Prague, and when I moved to Prague my [secret police] file didn’t move with me…. I had no past,” Buchar mused. But his past eventually caught up with him. “Later, around 1972, when the Russians tightened their grip on everything … because I wasn’t in the [Communist] Party I couldn’t work in the media.” When it became impossible for him to work, he found his way to freedom in the West.

Buchar’s documentary presents testimony from former Czech secret police officials who say the events of the Velvet Revolution of 1989 were orchestrated on orders from Moscow. The body of testimony on this subject is large and credible, says Buchar. “Not just … [the] guys that are talking in my film; there are many other people I talked to that refused to talk on record about this … because they fear for their lives…. There are many documents – it is very well documented that it was a prepared plan… to change the regime and the Russians were working on it for decades….”

Buchar interviewed an officer of the secret police who staged a key event in the 89 revolution. “He was just a little piece in the big puzzle,” says Buchar. “He pretty much did what he was told to do…. He was in charge of creating the students’ organization. The objective was to penetrate dissident movements … and organize the demonstration on November 17, 89 which triggered … the revolution. And at the end of this demonstration he played a dead student … killed by riot police. Of course it was a fake.”

The Soviet Union and its satellites may have changed their economic system in a presentational sense, but most of the former Soviet economic space remains under indirect (if not direct) government control. This new form of control relies on financial intermediaries, agent networks and organized crime. Using crony capitalism, together with underworld money-laundering deals, the post-Soviet economic system is spreading everywhere. It may even be colonizing the West’s market system, contaminating the whole.

If the Cold War was a struggle between economic freedom and repression, how can anyone now say the Soviet side lost? “No,” says Buchar, “the West lost tremendously….” As anyone can see, the free market system is not consistently defended in the West. We assume the market is going to triumph, but we don’t have a plan. The other side definitely has a plan. “If you watch my documentary you will see that Robert Gates gives the official CIA version of events,” said Buchar. But this is not the real story, or the whole story. “Vladimir Bukovsky is a pivotal point of my project because he got hold of documentary proof from the Communist Party Soviet Union…. Nobody can deny these documents….”

It is doubtful that Moscow’s plan worked in all the former bloc countries. Today the Czech Republic is rated by the Heritage Foundation 2012 Index of Economic Freedom as “moderately free,” ranking 30th. Of course, this does not reflect the secret levels of control which may operate through mafias and officials connected to the old system. More obviously, some East European countries have remained overtly repressive, like the former Soviet Republics of Belarus, Ukraine, Moldova and Uzbekistan. Others, like Azerbaijan, Moldova, and Russia are rated as “mostly unfree.”

Freedom seems to have prevailed, however, in the Soviet Republics of Estonia (ranking 16th) and Lithuania (rating 23rd), which are considered “mostly free” by the Heritage Foundation Index. These, of course, were among the smallest and least significant of the Soviet republics; and perhaps they were the most sophisticated in making use of the opportunities presented by the fall of the Soviet Union. In the last analysis, however, we must view the collapse of the communist bloc as equivocal. This truth is indisputably brought forth in Buchar’s documentary. And as Buchar warned at the end of my interview with him, “Many people today are wondering what’s going on in the United States and how it happened…. Nobody is really looking at it from this big picture that it’s actually not an internal problem; it’s an external problem. Whatever happened here is not just because of us; but it’s because of other forces pushing things on a global scale.”

Jeffrey Nyquist is the President of the Strategic Crisis Center and Distinguished Senior Fellow in Political Science at the Inter-American Institute for Philosophy, Government, and Social Thought.

This article was originally published on Financial Sense on August 27, 2012. The opinions published here are those of the writer and are not necessarily endorsed by the Institute.