George Reisman's Blog on Economics, Politics, Society, and Culture: WHERE PROFIT COMES FROM

This theory of profit/interest has major implications for the understanding of capital accumulation, the determination of real wages and the general standard of living, taxation, inflation/deflation, and the business cycle. It also provides the basis for the overthrow of virtually all aspects of Keynesianism and its system of national income accounting, along with an equally fundamental and thorough refutation of Marxism and the exploitation theory.

George Reisman's Blog on Economics, Politics, Society, and Culture: WHERE PROFIT COMES FROM

Obama’s Solar Scandal - Michael Barone - National Review Online

One factor favoring President Obama’s reelection, according to a recent article by political scientist Alan Lichtman, is the absence of scandal in his administration.

Lichtman may have spoken too soon.

The reason can be encapsulated in a single word: Solyndra.

That’s the name of a company that manufactured solar panels in Fremont, Calif. (which voted 71 percent for Obama in 2008). It was the first company to receive a loan guarantee from the Department of Energy as part of the 2009 stimulus package. This wasn’t small potatoes. The loan guarantee was for $535 million.

It was, Vice President Biden said, “exactly what the Recovery Act was all about.” Energy Secretary Steven Chu, a Nobel Prize winner, said it would help “spark a new revolution that will put Americans to work.” It was part of the Obama administration’s program to create so-called green jobs, which we were told were the key to future economic growth.

Obama’s Solar Scandal - Michael Barone - National Review Online

Obama Puts Taxes on Table - WSJ.com

What he shows no awareness of is that it is people who have wealth who are the ones who invest it in business and thus create the jobs he says he wants.  By raising taxes on "the wealthy"--in fact the upper middle class--Obama's policies are anti-growth, anti-wealth, and hurt everyone, especially those at the bottom of the wage scale.  We need those investment dollars.  We need to know that we don't have a government that hates success, hates wealth, and is perfectly willing to sacrifice those who earn a lot for the benefit who live off the rest of us.

In a speech Wednesday, Mr. Obama will propose cuts to entitlement programs, including Medicare and Medicaid, and changes to Social Security, a discussion he has largely left to Democrats and Republicans in Congress. He also will call for tax increases for people making over $250,000 a year, a proposal contained in his 2012 budget, and changing parts of the tax code he thinks benefit the wealthy.

http://online.wsj.com/article/SB10001424052748704366104576255282893680792.html?mod=WSJ_hp_LEFTTopStories

Corporate Freeloaders (This Weekend on FNC) « John Stossel

In America today, who are the biggest freeloaders?   Panhandlers?  Poor people?

You may be surprised that some of America's biggest recipients of handouts are rich people, and well-connected corporations.  The biggest corporate freeloaders may be the biggest industrial corporation in the world:  General Electric.

Read more: http://stossel.blogs.foxbusiness.com/2011/03/23/corporate-freeloaders-this-weekend-on-fnc/#ixzz1HXEM5qHq

http://stossel.blogs.foxbusiness.com/2011/03/23/corporate-freeloaders-this-weekend-on-fnc/

Laissez-Faire Capitalism Not Cause of Melt-Down

The reason for the melt down was, essentially, Freddie Mac and Fannie Mae, quasi-government entities, were told by Congress to enable people who could not afford houses to make it possible for them to buy houses with little or no money down, and with zero due-diligence as to sources of income to pay the mortgages.

Lenders then were guaranteed that Freddie and Fannie would buy such mortgage notes, thus relieving the originators of those loans of any liability.

Congress put the full faith and credit behind these securitized notes now repackaged by Freddie and Fannie who in turn sold them to other investors.  I understand that many of these securities then became the linchpin for other financial instruments called derivatives.

In effect, a hundred thousand dollar mortgage might back millions of dollars in further credit, secured only by an overpriced, speculative property whose owners may have had but a couple of thousand in initial equity, if that much--about what it would cost to make a security deposit and last month's rent on an equivalent rental home.

What made this boom possible was Uncle Sam's willingness to secure these loans, when there was nothing to secure them in reality beyond speculative dreams.

This situation could not possibly happen in a capitalist system, because government would have no part to play in guaranteeing a bank's poor judgment about what constitutes a secure loan.  Historically, banks have required 20% down payment and perform a stringent "due diligence" and they would have done that in this situation had the government not required them to make easy loans in the first place and in the second to buy the bad loans as soon as they were created.

From beginning to end, this financial debacle was completely and totally the result of government policy and actions.  It was the direct result of Congress passing laws requiring that banks make bad loans.  The Bush Administration and Congress are both responsible for the ensuing catastrophe.  But keep in mind, Congress was run by Democrats and the people in charge of oversight, people such as Barney Frank, stated over and over again that these bad loans were perfectly fine and dandy and that the Bush Administration's warnings could be safely rejected. 

Bush didn't do enough, and Congress is primarily responsible, but however you come out on that score, the bottom line is that the government created this catastrophe, not private businessmen, and was caused not by under-regulation but by government policies explicitly designed to increase home ownership by people who could not afford to own homes.

Why Does Business Support Both Political Parties?

I was recently asked by a friend to explain why men such as Jeffrey Immelt and other large corporations in the United States such as Goldman Sachs financially support both Democrats and Republicans, even as one party would seem to have the voters believe it supports businessmen and the other that it wishes to destroy them by taxing and regulating businessmen out of existence?

The facts my friend cites are not in dispute, and reflect the great depth of corruption in our current crony capitalist hybrid mixed economy.  One could understand why a corporation might support Republicans, but why would Goldman Sachs support the liberal and socialist program of the Democrats, a program whose seeming goal would lead only to its destruction?

The facts demonstrate the insight made by many who run our largest industries that:  1) the US government is a legalized criminal organization seeking "bribes" in the form of political contributions in exchange for certain "protections" from government regulatory, anti-trust, and taxing thuggery, and, 2) both major political parties are completely and irredeemably corrupt so the smart move is always to support both in case one or the other is able for the moment to delude enough voters to support its candidates.

It is true, not all businesses, not even all large businesses necessarily subscribe to this view of our government, but whether or not it represents their conscious views, it nonetheless offers a good theory why such businesses financially support politicians otherwise dedicated to their apparent destruction.  After all, when was the last time you heard a socialist, a Democrat, or even a Republican for that matter, defend businessmen?

Ayn Rand had some interesting things to say in a lecture given in 1962:

"Businessmen [her italics] are the one group that distinguishes capitalism and the American way of life from the totalitarian statism that is swallowing the rest of the world.  All the other social groups--workers, farmers, professional men, scientists, soldiers--exist under dictatorship, even though they exist in chains, in terror, in misery, and in progressive self-destruction.  But there is no such group as businessmen under a dictatorship.  Their place is taken by armed thugs:  by bureaucrats and commissars.  businessmen are the symbol of a free society--the symbol of America.  If and when they perish, civilization will perish.  But if you wish to fight for freedom, you must begin by fighting for its unrewarded, unrecognized, unacknowledged, yet best representatives--the American businessman."

Much has happened since 1962 when Ayn Rand said those words, and while Soviet communism has imploded and Red China has permitted a great deal of economic freedom for its citizens, we are now seeing on an unprecedented scale the slow, seemingly inexorable slide in the United States to a situation where leading businessmen such as Jeffrey Immelt of GE have now definitely moved into that twilight zone where the shift to the Dark Side becomes inevitable. 

 

Immelt is part businessman but now he is more of a commissar, a government thug pretending he is the CEO of a private corporation.  Immelt is not kept in corporate power because he has worked for the interests of the corporation--its stock has declined the entire period of his leadership--but because of his willingness to do the bidding of the federal government, in the present case, of President Barack Obama and the President's liberal allies on Capital Hill, all of whom are not necessarily liberal or Democrats.

Such men as Immelt have conceded the moral high ground to the socialists--that the good consists in sacrificing one's self, one's interests, for the "higher" good of society, whose voice is given expression by whichever gang of thugs is able to seize political power in the society at a given time.  Immelt and the others like him in the twilight are perfectly willing to play the game the socialists and liberals have invented and have become the willing milch cows of the corporate welfare state that we now have.

The socialist Democrats do not want to destroy businessmen, they want schmoos--businessmen who take delight in being devoured by the state.  Ultimately the schmoo is eaten alive, but the process can take quite a while and socialists have never been too concerned about the future anyway so long as they are able feed on the living body today.  They demonstrably have no problem mortgaging the future of the country, either, in order to continue feeding their social welfare programs, incidentally keeping themselves in power.

So Immelt and gang--the heads of Goldman Sachs for intance--understand the new rules and since they have already conceded they have no right to exist, that they have no rights as individual and exist merely on the sufferance of government, on "society's" need for their productive abilities, they will be permitted to keep some of their earnings, and, indeed, will be permitted to keep more of their earnings to induce other businessmen not willing to make schmoos of themselves, to alter their views and willingly surrender their interests and productivity to the service of state without a fight.

The picture is gruesome, a farce of unimaginable proportions.

And there is only one way to end it:  by rejecting the moral premise of the entire system that the good consists in the sacrifice of self to the interests of the collective.  It consists in the recognition and insight that the true good of everyone can never be advanced through the sacrifice of the individual, that society is, first and foremost, a collection of individuals, and that individuals have the moral right to exist, which means:  they have the right to the products of their own labor, intelligence, and talent.

American Thinker: Judge Vinson Also Smacks Down Crony Capitalists

Judge Vinson's individual mandate ruling is seen -- properly -- as a defeat for ObamaCare and a win for individual freedom. And it is all of that, of course.

But there's more. Perhaps almost as pleasing as the affirmation of individual freedom and the dismissal of a government run-society is the smack-down Judge Vinson's ruling gave to the concept of "crony capitalism." And that may be just as important in the long run.

After all, no government-run society is even possible without corporatists and crony capitalists eager to jump into the sack with the statists who will design laws to force unwilling customers to those corporations. This is something the statists will do under threat of sending IRS and other bureaucrats to harass every unwilling business or individual. You do remember that it was sixteen thousand new IRS agents -- not sixteen thousand new doctors -- that ObamaCare has plans to employ, don't you?

Gee, you think maybe ObamaCare was about control and not health care?

American Thinker: Judge Vinson Also Smacks Down Crony Capitalists

Common Fallacies About Capitalism 1

On my Facebook Page I come across misconceptions about capitalism, about corporations, and about business.  From time to time I will quote snippets from such misconceptions and then apply some reason and facts to enable you to make a more accurate judgment and revise your own notions accordingly.  Here are just a few I've recently come across.

I had written:  "As to fear, Americans have considerable justification to fear zero [the Obama Administration] and his thugs in Congress for the simple reason that Congress has been voting away our individual rights in favor of a dictatorship.  This is seen most notably with the recent passage of legislation that socialized the medical industry and deprives everyone of their right to run their lives as they wish."

To which my correspondent claimed:  "The insurance companies have regulations like any industry has."

Insurance companies are heavily regulated by the states.  Their rates are regulated directly and indirectly.  The state controls the market by limiting entry and it controls the product by specifying in detail what the product is.  To take Florida as an example, if you are an insurance company you are not permitted to sell medical insurance in Florida unless the state permits it, and the state will not permit it.  The state further tells the few insurance companies who are permitted to do business exactly what must be covered in the policies they are permitted to sell.  For example, I am not permitted to buy a policy that does not cover maternity benefits or mental health benefits, even though I do not want to pay for those benefits and can have no need for them.

The purpose of such regulation is to force me to subsidize through my excessive premiums the maternity benefits and mental health care benefits the legislature has decided it does not want to pay for directly from taxes.  Essentially the state is "shifting the cost" and indirectly subsidizing favored classes of people at the expense of others. 

So your facts are wrong.  Ordinary companies selling product or services are not required to get a permit to do so from the state, the state does not limit market entry, and the state does not tell the company what it can and cannot sell.  Companies must simply abide by the common laws all citizens must follow, pay any taxes due, which is the state's main concern, and the state will generally leave the company alone.  Customers then benefit by purchasing the product or service, or the company goes bankrupt because people choose not to do business with it.  People are not forced by the state to do business with it, as they are with insurance companies.


Claim:  "Without regulations, Lake Erie would still be dead and the Cayahoga river [sic] in Cleveland would still be burning."

This statement depends on what you mean by "regulations".  The principle of individual rights requires laws, and when a geographical area is without law, it is, quite literally, "lawless."  That was the situation with Lake Erie.  The "regulations" you cite--the Clean Water Act of 1972--essentially prohibited the dumping of nutrient phosphorus.  However, the problem would have been more effectively addressed by laws written to protect private property interests.  When you have a "commons" it is a well-known and understood phenomenon that unless the people who use the resource are permitted to develop informal or even formal rules for its use and disposal you will put into motion incentives that ultimately destroy the resource.

It is clear, for example, that current regulations do nothing to prevent dumping of raw sewage into these waterways and Lake Erie itself from public, not private, sources.  52 communities within the Lake Erie Watershed Basin, ranging from small towns like Avon Lake, to the larger metropolitan cities including Toledo and Cleveland, have 598 combined sewer overflow outfalls, or pipes, that feed into the waterways that lead into Lake Erie, or directly into the Lake itself.  An analysis of 38 of the 52 communities that dump untreated sewage shows that these communities dumped more than 10 billion gallons of sewage into the Lake Erie watershed in 2005 alone.  This is equivalent to more than 3 billion toilets flushing into Lake Erie--a drinking water source for more than 11 million people.  Combined sewage overflows are a major cause of beach advisories, wildlife destruction, and human death problems.

If private property rights were clearly defined in the Lake Erie Watershed Basin, Americans would have recourse to the courts to sue local and state governments to compel behavior from them that respected private property rights in Lake Erie.  But we do not have those protections because people have been mislead to believe that government "regulations" are protecting them.  Government typically does not monitor itself, doesn't sue itself, and, in fact, generally does everything it can to mislead and hide its malfeasance, just as ordinary criminals do.  This is another reason why the state should be separated from the economy as much as possible, i.e. a society based on laissez-faire capitalism, rather than the mixed economy of socialistic and fascistic controls with some freedoms also allowed.


Claim:  "BP didn't follow what scant regulations on drilling and we see the results."

Oil drilling activities are among the most heavily regulated in the country.  The facts are that the United States prohibited safe drilling on land and shallow water by fiat, forcing companies into the far more riskier deep water.  The government even gave oil companies incentives to drill in deep water and the current administration even exempted BP from having to meet its own regulatory standards.  In addition, the US specificially praised BP's platform, the one that blew up.

The outrage does not stop there.  Because of US regulations, BP was insured for only $75 million beyond the cost of any cleanup.  If BP had to get its insurance on the private market, instead of having the government insure its operations, that limit would have been far higher, the premium would have passed on through the chain in the form of higher production cost and the market would have substantially determined whether or not it was economically feasible to take such a risk.

The US government socialized the risk to BP for political reasons.  Such events happen when you have a mixed economy.  The solution is not more "regulations" but getting the government out of the the private sector so that it can provide the one thing it is qualified to provide the market:  clear liability laws that protect the people whose lives and property are being put in jeopardy.  We can't abolish risk, but we can insure against accidents.  When the government encourages risky behavior, rewards corporations for engaging in risky behavior, and then socializes the risk for risky behavior to further encourage it, how can the government be absolved of any responsibility?


Claim:  "The insurance companies are just leaches off the medical needs. It is not in any way single payer nor are these companies restricted. Hell, they wrote this health bill which sucks because it doesn't include an individual's right to bypass the insurance monsters who love to drop sick people and refuse to insure those with pre existing conditions."

You are misinformed.  As Adam Smith used to say, the tailor does not make you a new suit of clothes because he wants to see you well turned out; he turns you out in the best suit of clothes because he wants to feed his family and otherwise provide for his own economic needs.

Insurance companies are owned by stockholders, just ordinary people, looking to make some money by providing a service, a service that most people appreciate.

When government interfers with the private market, it initiates the use of physical force to compel people to behave in ways that oppose their own rational self-interests, and thereby corrupts the relationships between buyers and sellers, making them hostile.

People trade values voluntarily for mutual advantage, by definition, for otherwise they would not trade.  When government forces sellers to sell what they don't want to sell, and forces buyers to buy what they do not want to buy, government creates hostility, bad feeling, injustice, and sets up incentives for buyers and sellers to game the system in order to get what they want.

The fault lies not with the buyers and sellers, but with the government for intervening in the private economic activities of citizens.


Claim:  "Pray tell what individual rights have been removed since Bush/Obama?"

Perhaps you will accept just one example, since there is not enough time or space to list them all here.  The recently passed legislation that socializes the medical industry will have the effect of abridging the right of the people to seek medical care and to provide medical care as they wish.  Doctors will be forced to provide services and patients will be forced to accept services neither of them wants in precisely the way that they want them.  The government in this legislation establishes bureaus that will decide on what services doctors may provide and what services patients may receive, independently of the wishes of the doctor or patient.

The abridgment of individual rights, of course, occurs in some measure to some degree any time the government intervenes into the free market.  The medical industry was very heavily regulated prior to the rise of the Regime, a situation that created the manifold number of difficulties and injustices the new law pretends to resolve.  However, government intervention always creates many new problems that then require more government intervention, ad infinitum, until government comes to manage every aspect of life and no freedom remains for the individual.

Most everything the critics said of the new law, and denied by its supporters, is coming true as the regulations are put into place or proposed.


Claim:  "That bad memory lives on in the financial disaster we all are living thru [sic]. We and our government let billionaires play games with OUR money and homes. Capitalism sucks."

Your facts are wrong.  The system we currently have is very different from a capitalistic system.  Under capitalism, people have rights and the government does not have the legal power to abridge people's rights.

For example, in a free society (i.e. a capitalistic society) government would not have the power to force a citizen to pay the debt incurred by other citizens, as the current Regime has done in regard to the so-called "bailout".


Claim:  "AND your definition of socialism is not accurate. You describe communism."

Socialism commonly means government ownership and control of the means of production, i.e. all property.  Fascism commonly means government control of the means of production, but technical "ownership" remains in the hands of private citizens.  Communism commonly means government ownership and control of the means of production.

Socialism and communism mean the same thing.  The term "communism" has come to be associated historically with Marxism-Leninism, and the sorts of totalitarian governments that arouse under those politicians who identified as such.  However, there is really little to justify saying one is, in any particular, different in kind from the other.  For example, liberals greatly admire Fidel Castro and the murderous thug Che Guevara, and both these infamous sociopaths considered themselves socialists.  Liberals never tire, for example, in extolling the manifold virtues of the Cuban health care system, or the wonders of its education system.

Who Speaks for the Right?

As to the financial meltdown:

The essential problem with the sub-prime loans was that the market value of the underlying asset could not be sustained forever on the willingness of buyers to pay ever higher prices, on the assumption that prices would continue to rise.

Why did investors and lenders operate on the assumption that market prices for housing would continue to rise?

So long as Freddie and Fannie would buy the loans without verifying the ability of mortgagors to pay them off with current income or other assets, there was no incentive to perform due diligence, to verify income, no need to require a down-payment.

Where were the normal checks of free-market capitalism? Does anyone actually believe lenders would behave the way they've behaved during the real-estate boom, if they did not have two government agencies willing to buy whatever was offered? Asked in another way, how many lenders do you suppose would write no-money down deals without verifying income if they were to keep such loans in their own portfolios?

Who is the politician who can make this clear and defend capitalism?


As to the Republicans:

The Republicans lost for a lot of very good and understandable reasons. First and foremost, Republicans have given Americans some very bad government recently. Yes, there were some Republicans, including President Bush, who posted warnings. But what did Republicans do?

The principal disaster of the Bush Administration was the overwhelming and unaccountable failure to exercise leadership, to give an articulate voice for those Americans who believe the United States government is a government of limited powers delegated to it by the states and by the people, and that government is best that tries to perform its specific constitutional duties of providing for the common defense, rather than "reform" society according to the latest and best theories put forth by the liberal social engineers that constitute the Democratic Party.

The other disaster of the Bush Administration was its spending public money recklessly, extravagantly, and with utter disregard and contempt for the idea of limited government. Not once did the Bush Administration even threaten to veto Congressional approved spending bills, at least while Republicans ran the House and Senate.

One has to ask, as I did while the Bush Administration's basic trajectory was becoming clear, where is the political constituency for the big government Bush advocated? Social conservatives, economic libertarians and national defense hawks form the basis of the current Republican Party and Bush sought to appeal only to Social Conservatives and hawks. If any proof were needed of the importance of economic philosophy to a party's electoral success, we have it here.

Over the years of the Bush Administration I have spoken with many ordinary Republicans who became appalled by Bush's spend-without-consequence philosophy. It is rather difficult now, to oppose the spending plans of Mr. Obama, whatever they may be, because Republicans, under Mr. Bush, have completely and totally surrendered the tax issue, a marker for smaller, more limited government, to Obama and the Democrats, who promised a tax break to 95% of all Americans.

The American people may be mistaken to trust Obama and the Democrats with the responsibility of creating smaller and more effective government, but electing Obama was the only way to rid the country of the despised Republicans whose nominee only national defense hawks could respect, who went out of his way to insult social conservatives, and demonstrated complete contempt for economics by declaring he didn't know anything about the subject.

Even then he managed to get 46% of the vote. What would have happened had a candidate of the Right been the nominee, a candidate who was pro-life, pro-national defense, and pro-laissez-faire?

He (or she) would have won.

Tom Anderson

December 2008

Gay Republicans?

Or, Why Gays Should Hold Their Noses and Vote Republican Anyway

Far be it from me to suggest that gay men and women differ so little in their political views that it makes sense to talk about a specifically “gay” political ideology.

Yet gays do seem to have some common political objectives, mostly having to do with the right to be left alone.

Unfortunately, the desire of gays to live their lives without being discriminated against in employment and to be able to form close personal and sexual relationships in the same manner and with the same legal protections as heterosexuals, outrages the Christian fundamentalists in our midst, causing them to express their hostility to gays politically by supporting Republican politicians who mouth anti-gay slogans at election time, but who, at other times and places, employ gays, have gay friends, and may even engage in homosexual activity themselves, as “closet homosexuals.”

As seen in the recent Foley scandal, some gays seek to “out” closeted gays, arguing that honesty is better than hypocrisy.

I argue that gays do have a common politics, and it is a very old political viewpoint–-the French have a wonderful phrase for it: laissez-faire capitalism.

What the phrase basically means is that the purpose of law should be to secure the rights of the individual against those exercising through law disproportionate economic and political power. It means, simply, “Leave us alone!”

What gives those exercising greater power the right to do so? What gives government the right to deny to gay couples, what is offered to heterosexual couples upon payment of a small legal fee?

Any group in society secures its power to abridge the rights of others by getting laws enacted that are generally justified at the time of their enactment by appeals to “the public interest” or to some similar political abstraction that can be twisted and turned to serve whatever political goals the group has in mind.

At present the varied political interests that make up the American electorate are broadly arrayed into “conservatives” and “liberals”. We also have two major political parties: the dominant party, the Republicans, consist of a very broad coalition of interests, and the Democrats, the party “in the wilderness”, seems far less broad, apparently consisting of Neanderthal Leftists, such as those whose views are best represented by The Nation magazine, and other self-styled “progressive” groups each of which seems to have a favored hobby-horse to ride.

What until fairly recently distinguished the two parties was the willingness of the Republicans to champion “limited government.” Ronald Reagan welcomed the Christian Right into his crusade to “get the government off the backs of the American people”, but he never let the Christians rule the roost. While his administration was not particularly helpful to gays with the explosion of HIV-related deaths in the 1980’s, indifference and incomprehension are not the same as hatred and the desire to do injury.

Even today, as the Foley scandal highlights Republican attitudes towards gays, what emerges is more an attitude of opportunism–the desire to play the “gay card” in order to motivate homophobic Christians to vote for Republican candidates–than any outright hatred or desire to inflict injury upon gays.

As much as homophobic Christians might wish to harm gays, the most significant anti-gay legislation since the election of Bill Clinton to the Presidency in 1992 has been the anti-gay Defense of Marriage Act, signed into law by Clinton. The other significant bit of law to harm gay people was the Clinton military policy of “Don’t Ask–-Don’t Tell”. Justified in the name of making it possible for gays to serve honorably in the military, the policy has become a shameful blot upon the military by a civilian government that seeks to keep its anti-gay credentials well burnished for election-day politics, despite the positive harm the policy does to our military–-depriving it of skilled and expensively trained personnel by cashiering gay soldiers and officers–-and to gay self-esteem, by treating gays as second-class citizens, unworthy and unneeded in the defense of the country against foreign enemies.

Any hope that the long-suffering American people might be done with “Big Brother” type government was dashed in the 1988 election of the first Bush Presidency. Reagan rose politically with the first conservative revolution, the taking over of the Republican Party in 1964 with the nomination of Barry Goldwater. “Goldwater Republicans” considered themselves “movement conservatives” and typically believed in a very libertarian-oriented society where government, particularly the federal government, would have its many functions substantially reduced or eliminated.

Why democratic government tends to expand in its functions despite the best efforts of people like Goldwater or Reagan to restrain it, is a conversation for another time. But there is a lesson for gays to heed.

Gays need to look to the history of a party and not just its current crop of politicians to see where specific gay interests are more likely to find political defense.

Are not gays interested in a prosperous economy where their hard work and intelligence are rewarded? Do not gays enjoy keeping most of their earnings for their own use and disposal rather than have increasingly larger portions of their earned income siphoned off to support tax breaks, subsidies, and special legislation for Big Business, otherwise known as Crony Capitalism?

Do not gays have an interest in protecting our borders against illegal immigrants? Are we not interested in preventing further attacks on our cities from Islamo-Fascists? Do we not enjoy tax cuts? Are not our economic interests enhanced by laws that reduce government intervention into the economy?

I don’t like to quote statistics, but isn’t it true that gays have more disposable income than non-gays?

Gays don’t seem to fit the profile generally used to describe the left-wing “nut-cases” that control the Democratic Party at present, for the simple reason that gays want respect and freedom to be left alone. They don’t want what the Democratic Party normally promises: more subsidies, more taxes, more regulation, more intrusion of the Nanny State into every aspect of their lives.

The Republican Party today is up for grabs. George Bush is not a movement conservative. I believe gays should not leave the Party but reclaim it by holding it up to its professed libertarian origins. What will become clear, if the proper arguments are made, is that homophobic Christians in the Party express beliefs difficult to square with limited-government rhetoric. And while there may be more homophobes than gays in the GOP, clearly gays can have a significant impact intellectually by making the arguments that Republicans really can’t ignore.

To some extent, I must confess, either party has some libertarian origins gays could draw upon; but which image is more likely to be gay? A ward of the state, or a businessman? A ward of the state, or a creative artist? A ward of the state, or a leatherman seeking to find his bliss in consensual erotic adventures?

The Republican Party, whether the current crop of politicians understands this or not, is the “natural” home for gays and lesbians. Our nemesis is not the Party, but the homophobes within it who would replace politicians with priests.

Tom Anderson

October 2006