Category Archives: Free Market

This article was published by The McAlvany Intelligence Advisor on Wednesday, May 15, 2019: 

In 1779, Ned Ludd, an apprentice hand weaver, smashed two stocking frames because of his fear that the improved machinery would put him out of a job. The resistance to automation began in Nottingham, England, and became widespread in the early 1800s. Over time, its attractiveness waned thanks both to government intervention and the awareness that lowering the cost of textiles through automation benefited everyone wearing clothes.

Ned would be astonished at the automation taking place in the U.S. today. Amazon is quietly installing machines called CartonWraps and SmartPacs in its never-ending quest to serve its customers more quickly at lower cost. In busy warehouses serving Seattle, Frankfurt, Milan, Amsterdam, and Manchester, the company is taking the tiring work employees were doing – each spending up to 10 hours a day taking products and building shipping boxes to fit them for shipping – and giving it to robots.

The robots work four times faster than humans

This article appeared online at TheNewAmerican.com on Tuesday, April 2, 2019: 

When Venezuela’s Marxist dictator Nicolas Maduro addressed his citizens on Sunday, he told them that their electric power would be rationed: “I have approved a 30-day plan to regulate the output.” He called the plan “a load management regime.”

Unfortunately, owing to the rolling power outages that have plagued Venezuela over the last month, most of those citizens, if they had television, weren’t able to view his speech because their power was out.

That is the end point of socialism: When government interferes, products and services formerly provided by the free market become limited. Prices go up and price controls follow. The price controls further limit supply, and the final step is rationing what’s left.

Maduro admitted to two failures in that short sentence: His government is unable to provide for his people; and those shortages are likely to last for a long time. The unspoken message being delivered is that socialism, no matter what it might be called, always ends in tyranny, misery, and death.

Venezuela’s power industry was nationalized in 2007 under the socialist administration of Maduro’s predecessor and mentor, Marxist Hugo Chavez. The ideology of socialism, termed Chavismo, continued under Maduro following Chavez’s death in 2013. Consequently, those professionals running the energy grid were removed and replaced with political appointees as rewards for their loyalty to the socialist regime. Since then some 25,000 technicians skilled in running the power industry have left the country, leaving the incompetent in charge.

As Maduro’s economy spiraled downward, funds for maintenance dried up. In early March a grassfire burned some trunk lines feeding power from the country’s Guri dam, causing turbines generating power to fail. This plunged the populace into darkness for days. On March 25, another outage led to more misery, and more socialist intervention in the form of rationing the remaining electricity that the power plant is able to produce.

The impacts are predictable, and widely known:

This article appeared online at TheNewAmerican.com on Wednesday, November 14, 2018:  

Just when concerns over the future of the U.S. economy have reached fever pitch thanks to the recent volatility on Wall Street, along comes the National Federation of Independent Business (NFIB) to calm those concerns. Its October report, “Small Business Economic Trends”, was summed up thus:

Overall, small businesses continue to support the 3 percent plus growth of the economy and add significant numbers of new workers to the employment pool.

 

The percent of owners with one or more unfilled openings is at a 45 year record high level.

 

Employment is growing faster than the population (210,000 per month this year to date), so the gains in jobs are being “fueled” in part by increased labor force participation.

 

Consumer optimism is also running at near-record levels, supported by rising wages and plentiful job openings.

After reviewing the numbers in each category (from “plans to increase employment” to “earnings trends”), the authors of the study concluded: “Bottom line, the October report sets the stage for solid growth in the economy and in employment in the fourth quarter, while inflation and interest rates remain historically tame. Small businesses are moving the economy forward.”

Indeed they are. The NFIB boasts membership of 325,000 small business owners, reflective of the estimated 28 million small-to-medium-sized businesses in the United States with fewer than 500 employees. That’s compared to about 20,000 companies with 500 employees or more.

And they swing a big hammer.

This article appeared online at TheNewAmerican.com on Friday, October 26, 2018: 

It’s highly unlikely that Harvard-trained economist Justin Wolfers has ever been to Caracas, Venezuela. It’s also unlikely that he took the time to read the 72-page report “The Opportunity Costs of Socialism” issued by President Trump’s Council of Economic Advisers (CEA) explaining the dangers in enacting Bernie Sanders’ socialist healthcare takeover called “Medicare for All.” But he has an opinion, nevertheless: he called it “dreck” in his tweet: “For several generations the CEA harnessed the best and brightest to serve their country, ensuring White House policy was informed by modern [i.e., Keynesian] economic thinking. It’s sad to see [the present Trump CEA] debase that tradition, spending their time on this dreck.”

Merriam-Webster offers various synonyms for “dreck,” including chaff, deadwood, debris, dross, dust, garbage, junk, litter, offal, refuse, riffraff, rubbish, scrap, trash, truck, and waste. In other words, Wolfer doesn’t think much of the CEA’s effort.

On the other hand,