Friedrich A. Hayek’s training and pursuits in economics led him to reach conclusions about society, government, and markets.

Quoting from Friedrich A. Hayek’s lecture “The Pretense of Knowledge” upon accepting the Nobel Prize in economics, Dec. 11, 1974:

To act on the belief that we possess the knowledge and the power which enable us to shape the processes of society entirely to our liking, knowledge which in fact we do not possess, is likely to make us do much harm. In the physical sciences there may be little objection to trying to do the impossible; one might even feel that one ought not to discourage the over-confident because their experiments may after all produce some new insights. But in the social field the erroneous belief that the exercise of some power would have beneficial consequences is likely to lead to a new power to coerce other men being conferred on some authority.

Even if such power is not in itself bad, its exercise is likely to impede the functioning of those spontaneous ordering forces by which, without understanding them, man is in fact so largely assisted in the pursuit of his aims. We are only beginning to understand on how subtle a communication system the functioning of an advanced industrial society is based—a communications system which we call the market and which turns out to be a more efficient mechanism for digesting dispersed information than any that man has deliberately designed.

If man is not to do more harm than good in his efforts to improve the social order, he will have to learn that in this, as in all other fields where essential complexity of an organized kind prevails, he cannot acquire the full knowledge which would make mastery of the events possible. He will therefore have to use what knowledge he can achieve, not to shape the results as the craftsman shapes his handiwork, but rather to cultivate a growth by providing the appropriate environment, in the manner in which the gardener does this for his plants.

There is danger in the exuberant feeling of ever growing power which the advance of the physical sciences has engendered and which tempts man to try, “dizzy with success,” to use a characteristic phrase of early communism, to subject not only our natural but also our human environment to the control of a human will. The recognition of the insuperable limits to his knowledge ought indeed to teach the student of society a lesson of humility which should guard him against becoming an accomplice in men’s fatal striving to control society—a striving which makes him not only a tyrant over his fellows, but which may well make him the destroyer of a civilization which no brain has designed but which has grown from the free efforts of millions of individuals.

What Hayek refers to as “spontaneous ordering forces” is in my experience more directly identifiable as the morality of the free market. Any free market must be moral to exist. Morality here is defined by the promises of the seller to the buyer, and from the buyer to the seller.

When you buy something as simple as a package of candy you presume there is something inside that is safe to eat and you have a expectation of the form, taste, and texture of that food based on prior experience. You exchange your money for the package of candy because you trust what you are receiving in exchange. Likewise, the distributor of the package of candy presumes your form of payment is valid just as the manufacturer of the candy trusted the distributor’s form of payment in delivering cases of candy to the store where you purchased it.

This same trust is characteristic of all free markets where buyer and seller voluntarily exchange and provides an essential “ordering force.” If the candy is tainted the buyer quickly seeks a remedy from the distributor and/or manufacturer for breaking the essential promise of safety and expectation, and the buyer is free to seek another distributor and/or manufacturer the next time they want a package of candy. (If you have ever returned something to the supermarket you were enforcing this market bargain, providing an “ordering force.”)

Now follow this thinking to bigger markets such as the market for labor and the market for health care. How is it possible for society to end up in a better place if the government interjects laws between the free exchange of buyer and seller?

If government imposes minimum wage laws many people may lose their jobs because higher wages incent automation and contribute to higher prices. At what point does the cost of a machine making Big Macs become more cost effective than paying a person to perform that task? Keep in mind that the price of the Big Mac necessarily includes the cost of making it and that the customers of the Big Mac (all of whom have an interest in the price) include the people employed at McDonalds. There is no way anyone (let alone those in government) can know the net societal consequences of minimum wage laws with any certainty yet politicians continue to expand such laws and set higher and higher minimum wages.

Our recent progressive efforts to control health care (Afforable Care Act) and banking (Dodd-Frank) are subject to the same realities. Application of progressive ideology in government planning and control proves less effective than the free market in creating a just outcome exactly because such planning and control remove the moral requirements of voluntary exchange and direct accountability from the process. These essential “ordering forces” are replaced with all involved being compelled to trade (not voluntary) in an authorized manner and all involved then blame each other when something goes wrong (no accountability). In the health care area, what preceded Obamacare is just as bad as Obamacare in not allowing the benefits of the free market to contribute to an improved outcome. In the banking area, the simplicity of compartmentalization of risk under the 52 page Glass-Steagall Act of 1932 protected citizens from excessive bank risk taking until its effective repeal in 1999 but now the progressives demand the 849 page Dodd-Frank Act that does more to grant government leverage over the banking industry (see J.P. Morgan settlement) than it does to protect citizens from excessive bank risk taking, undermining a free market in banking services.

The unparalleled success of America is not the result of, and our success in the future will not benefit from, a bigger and more intrusive government interfering in our right of free exchange. We need to elect those who understand and promote the benefits of free markets to represent us in Washington, D.C.

Regards, Pete Weldon
americanstance.org

Mr. Obama and his administration are so smart, so clever, so incapable of being honest or sincere, and only pretending to be.

The evidence of this is in their semantics. Their use of words to persuade is replete with inaccuracies, untruths, incompleteness, and guile.

A few examples:

The most famous is “If you like your plan you can keep your plan, period” repeated at least 60 times by Mr. Obama and replicated endlessly in the media as expected and desired by the administration. This phrase was specifically designed to relieve worried citizens of the fear that Obamacare would negatively impact them and to enable its passage. We also know that Mr. Obama and members of his administration knew their claim was disingenuous at best and an outright lie at worst.

Then there is the constant phrase used by Mr. Obama that healthcare.gov is a “marketplace” where you can “shop” for health insurance.

A “marketplace” brings to mind a farmer’s market where numerous independent sellers bring their wares and trade with consumers who voluntarily “shop” to meet specific needs.

Definition of “marketplace” – a place where various goods are bought and sold.

Definition of “shop” – to look for something that you want to buy.

Definition of “buy” – to get something that you want or need, usually by losing something else that is important.

Healthcare.gov in contrast is a place where those qualifying for subsidies are compelled to apply and then receive a list of health plans meeting the requirements of Obamacare, not the needs of the consumers. The sellers (the insurance companies) can only sell what the government approves. There is no negotiation. There is no real choice. There is no shopping. There is no marketplace. Healthcare.gov is only a vehicle through which consumers seeking subsidies MUST buy health plans approved by the government. Consumers not qualifying for subsidies can also go to health insurance company web sites to purchase Obamacare approved plans directly. There will not be any plans other than Obamacare approved plans after 2014 unless the law is changed.

Mr. Obama’s use of the terms “marketplace” and “shop” are conjured to make it all seem a routine free market environment where you go to get products you want at competitive prices. The words were chosen on purpose to corrupt the truth and persuade through misrepresentation and guile.

These unfortunate realities will hit home when each individual experiences Healthcare.gov.

Regards, Pete Weldon
americanstance.org

Our Demonizer and Chief has the megalomaniacal gall to pronounce that the American people are fed up with Washington. Well, yes and that includes him.

Not only does Mr. Obama presume himself above the responsibilities of leadership, not only does he insist that the government knows what is best for us, he also presumes to tell us what we think.

The media’s love for this nonsense and their presumption of Mr. Obama’s credibility challenges the facts.

The reality of Mr. Obama’s “transformation” can be supported as nothing more than a complete disaster. Since Mr. Obama took office in 2009:

• The poverty rate is almost 15% and has hovered around its all time peak over the past 4-5 years based on Census Bureau data since 1959. Almost 15% of Americans (about 46 million people) live in poverty.
• African Americans are worse off under Mr. Obama. He has done nothing to improve their lives but instead further subsidizes them out of hope and opportunity.
• US debt has increased from $9,000,000,000,000 to almost $17,000,000,000,000 and is budgeted at almost $20,000,000,000,000 by the time Mr. Obama is replaced.
• Annual real economic growth has been less than 2%, limiting opportunity for those with lower incomes and skills.
• The Federal Reserve’s manipulation of interest rates has penalized workers and savers while propping up risk assets, benefiting the most well off while constraining wealth creation for those with lower incomes and skills.
• The Dodd/Frank law has given the government control over the private banking system, politicizing all banking services to the detriment of economic freedom needed to finance growth and create jobs.
• Food stamps (SNAP) dependency has grown over 70%, from 28 million Americans to over 48 million, while the cost of food stamps has increased more than 100%, from $30 billion a year to over $75 billion.
• Obamacare’s re-distributional realities coerce money from young, productive, and healthy citizens to subsidize health care for older, sicker citizens, will result in shortages of health care professionals and services leading to higher prices and rationing, and will put the government in charge of defining standards of care for all covered medical conditions. Yes, he lied. You can’t keep your doctor. You can’t keep your health plan. Health costs will increase. You will do what the government tells you to do.

The litany of disaster extends to other domestic realities as well as international affairs.

Having achieved power by promoting envy, resentment, dependency and a false concept of “justice” Mr. Obama and his progressive ideologues now must face the failure of their leadership and policy. The “transformation” that has been imposed upon us by our own government is one of greater unemployment, greater dependency, less opportunity, less hope, and less freedom.

Who among us can say that their children will be better off because of Mr. Obama and his supporters in Congress?

This is the question that will win elections in 2014.

Regards, Pete Weldon
americanstance.org