Theory is only sound if it can be proven in practice. In theory cold fusion will solve our energy problems but until it makes the transition from theory to a practical reality we might as well be discussing the energy output of unicorn droppings.

If your theory worked China would have a GNP roughly 4x that of the US. Same with India. Mexico’s GNP would be a third of the US. None of this is true. Arguing government intervention in the free market is an over simplistic dismissal of my post. I didn’t treat you in a cavalier manner so I’d appreciate the same in return.

We have disparate markets, disparate standards of living, disparate cultures, disparate freedoms, disparate government structures, disparate population growth, disparate educational systems, disparate levels of corruption, disparate entitlement programs, disparate infrastructure, and the list goes on. The theory that we should let these markets equalize without regulation is a formula for economic meltdown on an unprecedented level. You can have all the cheap goods in the market you can imagine but it does you no good whatsoever if you don’t have a job or have a job that pays so little that you can’t pay for the goods you wish to purchase.

It doesn’t matter how you define wealth it is axiomatic that you do not get richer importing an unending supply of ignorance and poverty. You don’t need theory to demonstrate that. You don’t even need to take an econ class. Just pick up the newspaper.

So supporting a democratic decision is the definition of “statism” now? I had no idea. Is there someplace I can look up these new definitions because I haven’t learned Newspeak yet.

I really don’t see a practical alternative to a Democratic-Republic. A society where men inherently respect the natural rights of other men without coercion in some kind of harmonious anarchy seems as contrary to human nature as Marx’s vision of utopia. As Madison said, “If men were angles there would be no need for government.” If only wishing made it so.

The US Constitution is the best history has to offer as of yet so it would seem prudent to protect it until something better proves itself. I’d hate to give up on it only to discover that Rand, Von Mises and the other Freeman icons aren’t quite as insightful as many on here would like to believe. Freedom and prosperity, once lost, are usually difficult to regain.

Of the four words you use to define your vision, three are entirely subjective (right, ethical, and moral). According to American ideals and, to a lesser extent, European ideals we may well be the very definition of these traits but according to Sharia law our standing is less secure. The quickest way to ensure that what we deem “right, ethical, and moral” are replaced by some other definition is to respect and defend the natural rights of someone that has absolutely no respect for our natural rights. While we’re busy discussing the finer points of philosophy he’s busy taking advantage of our largess and using it to undermine what we value most.

It’s a free-market model. The problem is a lack of free markets. The theory is sound.

“What this proves is we need are richer customers, not cheaper labor.”

There are two ways to become richer: I obtain more money (whereby I become rich and no one else does) or consumer goods become cheaper (in which case real income for everyone increases). Cheaper labor and market competition does the latter. Again, the theory is sound. Government interventionism prevents this from happening.

“If the People want safety net programs we should be able to vote to implement them. I may not like it but that’s the will of the People. Failing to implement the will of the People is tyranny. I don’t think I’d be much of a libertarian if I started arguing that the government should act in opposition to the will of the People.”

I think that the above quote of yours is the most revealing I have yet seen from you. On this foundation of democracy worship, you have erected an edifice of statism. Don’t get me wrong, I can understand. I too used to fall for the lie that simply because a majority agrees upon it, the resulting decision is right, legal, ethical, moral, etc.

It’s only when you realize the fact that democracy cannot create or negate God-given rights that you can begin to unravel the rest of the statist fallacies. Broadly speaking, where people fall on the libertarian spectrum is simply the extent to which they have accepted or rejected this lie and how consistently they apply their conclusions.

No King But God

If your model accurately described reality we could apply it almost universally to any nation on the planet but it doesn’t apply to a single one.

75% of illegal aliens come from Latin America. Most of these from Mexico (57%). So let’s examine Mexico. Mexico has one of the fastest growing populations on the planet but it has one of the weakest economies. If your theory that an increase in labor is good for the economy by lowering prices then Mexico should have one of the strongest economies due to its grossly unsustainable population growth and propensity to export cheap goods. Where does Mexico make money? Pemex is #1. Emigrants sending home money from the US is #2. Cheap goods produced by cheap labor does not even come close driving their economy. US oil consumption, US entitlement programs, and unethical US business men do.

Let us examine India. India has one of the fastest, if not the fastest, population growths on the planet. Their population is more than 4 times that of the US but it has an economy that is a fraction of ours and their per capita standard of living makes the streets of Watt’s look plush. High labor + low cost goods = prosperity? Doesn’t work there either.

China has an emerging economy because it has implemented draconian laws limiting child birth and embraced a limited capitalist model. If they can maintain this rather than returning to reproductive behavior that would make rabbits blush they might join the US, Germany and Japan as one of the dominating economies on the planet. So China proves that an increase in the scarcity of labor results in an increase in the buying power of the consumer which leads to a marginal increase in prices and inflation but a proportionally larger increase in the economic power of the nation and a real increase in the standard of living.

What this proves is we need are richer customers, not cheaper labor. Kennedy knew it. Regan knew it. China is slowly figuring it out. Someone should explain it to Obama because (if you will forgive a brief aside) he seems to think runaway government spending is more effective than cutting taxes which is as absurd as flying to the Moon on a teacup. FDR did not end the Great Depression by spending tax dollars. It ended because we blew up half the planet (not our half) and our businesses and banks got rich rebuilding it. End of aside.

The thing that has made the US and Europe prosperous is the percentage of educated workers producing better goods for less using inventions like the cotton gin, internal combustion engine, computers, and robots, not cheap labor via grossly over productive wombs. We use trucks, bulldozers, and backhoes to build roads and freeways, they use hundreds of men with shovels. Which of these models has proven more productive?

The thing they typically don’t teach you in any Economics class is our economy is essentially a giant pyramid scheme where the lower class and middle class work to make the rich, richer. Occasionally someone breaks through into the upper economic echelons but that’s the exception rather than the rule. The thing that fuels this Ponzi scheme is the rich sharing the wealth in a fashion similar to what Henry Ford called “Welfare Capitalism” (not to be confused with European Welfare Capitalism). As the rich get richer, they share a portion of this wealth with the middle and lower classes thus raising the economic foundation for everyone thus increasing productivity, standard of living, consumer confidence, which is why the typical US worker out produces his ECU counterpart on a scale of nearly 2 to 1.

This model was at its strongest in the 50’s and 60’s when the “rich” owned less than 60% of the wealth in the nation but the US had an economy and production capacity that exceeded the rest of the world combined.

By increasing the number of poor and uneducated by what amounts to an infinite number it stalls the economic engine. The market indigenous are competing with markets that have a lower standard of living. This results in jobs “American’s won’t do” as Baby Bush so eloquently called them. Unfortunately he left out “… for the wage being offered.”

As you may remember from your Macro classes when two disparate markets interact they will attempt to equalize and that’s what’s happening. As Mexico continues to export poor money is flowing from the US into their markets raising their standard of living while ours drops. I think the average annual wage in the US is around $45,000 while it is something like $3,500 in Mexico.

California is demonstrating what happens when two disparate markets try to equalize without regulation. We dropped from the 5th largest economy to 8th and have a deficit that’s somewhere between $19 and $24 billion so Sacramento is trying to supplement the loss of revenue by raising taxes and fees. All this does is drive more business and the richer taxpayers out of the state increasing the number of unemployed on entitlements. The tax base erodes, the number of entitlements grows, and we have a 12% unemployment rate while the rest of the nation is around 9%, we are the highest taxed state, and have one of the highest cost of living on the planet. CA lagged behind in the last recovery and we’ll do so again because our state representatives like Gil Sedillo, Gloria Romero, and dozens of others are more interested in their role as members of the “Latino Caucus” helping thethan their duty to the State of California or the US as a nation.