Let’s, for the sake of argument, assume that HR 3200 is completely revenue neutral and that no one will be taxed a single extra penny, because, for the purposes of my discussion below, it doesn’t matter whether this is true or not. If you comment on this article and say anything about revenue neutrality or no increased taxes (on people making less than that magical number of $250K/year, of course), I will simply laugh at you for not reading the article and shouting out talking points.

It has been established that insurance companies struck a deal with Washington. The deal: You (Washington) force everyone to buy an insurance plan and we (the big bad insurance companies) will support a plan to insure people with preexisting conditions.

That sounds great, right? I mean, it’s just like auto insurance. The reason auto insurance is so cheap (I pay more for car insurance than I do for health insurance… so figure that one out for me) is that the auto insurance companies have a better risk pool because both good and bad drivers are forced to buy insurance.

You see, what would happen if not everyone were forced to buy auto insurance is that people who are not risk averse and feel that they are great drivers would buy either a watered-down policy or no policy at all. The bad drivers (knowing that they are bad drivers or otherwise accident prone) and the risk averse would pay a higher premium for better insurance. The insurance company would really have very little way to tell who was buying the better packages because he is just a bad driver and who is simply risk averse. This problem is known as adverse selection, which often occurs in situations where there is an asymmetry of information, meaning one or both parties have information that the other does not have.

Because of this problem of adverse selection, the insurance companies would charge a very large premium for the bad drivers (i.e. the policies with more coverage) and a very small premium for the good drivers (i.e. the policies with less coverage).

Now, when the government steps in and forces EVERYONE to buy a certain minimum level of coverage, what happens? Well, now the insurance companies know that some of the drivers are very good drivers who will rarely, if ever, make a claim, while some are the bad drivers who will constantly be making claims, probably in excess of the premiums they pay. But, because of the risk pooling now in effect, the insurance company can charge the bad drivers a smaller premium than before because the good drivers are making up the difference. In other words, the good drivers are subsidizing the bad drivers’ insurance premiums when they are forced to buy a minimum coverage in excess of what they would have without the law forcing the purchase of a minimum coverage policy.

This is great for bad drivers, and terrible for good drivers. Not only is it bad for good drivers because they pay more, but there are more bad drivers on the road because the good drivers are subsidizing their bad driving practices! And, on top of that, some of the good drivers who would have bought less expensive policies and then either not repaired minor cosmetic issues that are pricey to repair, or would have paid out of pocket because their plan didn’t cover it will start getting those repairs done, increasing both demand for and, therefore, cost of auto repairs.

Back to health care:

The health insurance lobby is not entirely stupid. They understand what’s at risk here. Either they cover preexisting conditions, or they face competition against a “public option” which will most certainly cover preexisting conditions at a fraction of the cost, being backed by the seemingly bottomless purse of the United States Treasury (ultimately, this is tax payers’ money… and mostly “rich” tax payers’ money). So, they cut a deal with Washington.

The health insurance companies know that if they can create a better risk pool by forcing young, healthy people into plans with certain “minimum standards”, then they can offer lower insurance premiums to older, sicker people and they can offer to cover preexisting conditions. The solution is clear: get into bed with Washington.

Just like auto insurance, this is great for those who will use their health insurance the most: the sick and the old. This is a terrible deal for those who wouldn’t typically use their health insurance all that much: the young and the healthy.

This is a massive transfer of cost from the sick to the healthy. And, because the healthy will be forced to buy more expensive policies, they will be more apt to use the policy, increasing the demand of and, therefore, the cost of health care.

It all sounds like a good deal to anyone with a heart. However, when you look at the unintended consequences, you have to ask yourself if it’s right. The people who will be disproportionately hurt by this deal are the young, healthy people in our economy. It will become more expensive to ensure low wage earners (who are typically younger, healthier workers), and it will cost those young people who are either unemployed or self-employed a considerable amount more money to buy health insurance, because they will be forced into buying more expensive coverage to meet minimum coverage standards.

Ultimately, this will cost young, healthy people their jobs as they become more expensive to insure. It will keep unemployment rates higher among the very people this bill is aimed to help: the poor (low income earners) and the unemployed.

For those of you who have preexisting conditions and think this is a great thing, I only ask that you say out loud what you are truly asking for: “I want to force healthy people to pay more money so that I can pay less. I want to take from the healthy for my benefit.” Don’t try to make this seem like some nobel purpose you are pursuing – some right to which all Americans are entitled. You are in this for yourself. You are as greedy as Bernie Madoff, but you are trying to use the government to force people to give to you, whereas Bernie Madoff just committed fraud. You both have the same end goal: more for yourself at the expense of others.

Just when you thought the arrogance of Congressmen couldn’t get any worse, Alan Grayson (D-FL) is going to introduce a bill to require that employers with more than 100 employees give their employees 1 week of paid vacation time.

According to Erika Lovely of Politico (http://www.politico.com/news/stories/0509/22794.html), Rep. Grayson had this revelation that the government should mandate vacation pay while he, himself, was on vacation at Disney World. I understand that he thinks this would be stimulative. His line of thinking probably went like this: “Look at this sea of people. You know how we could really stimulate the economy – especially here in Florida – we should just pay all these people for the time they’re spending here.” OK, it probably didn’t go quite like that, but I just can’t resist poking fun at someone who is arrogant enough to think he should tell all companies how to run their businesses.

The argument actually is something more like this: Rep. Grayson reportedly claims that people would be more productive if they had more time off. Apparently, companies are too stupid to figure this out for themselves, and need the likes of Rep. Grayson to force them to make their employees more productive. Now, I’m going to grant Rep. Grayson credit where credit is due: He started IDT Corp. and has been a successful businessman in the private sector. So, at least he’s actually held a job that didn’t involve telling other people how to live their lives. However, that doesn’t make his bill any less arrogant.

Why does the government need to tell companies to offer vacation pay? If Rep. Grayson, or anyone else, truly believes that companies offering paid vacation time have more productive employees, here’s a few ideas: 1) start a company and offer paid vacation; 2) start a fund and invest in only companies that offer broad-based paid vacation plans to employees; 3) invest privately in public companies that offer broad-based paid vacation plans to employees; 4) give what is known as “angel money” to start-up companies offering paid vacation; 5) start a private equity fund investing in start-up companies offering paid vacation.

If paid vacation really makes employees more productive, then the market has ways to ensure that paid vacation finds its way into more companies. After all, if paid vacation really makes employees more productive, then companies with paid vacation will sweep the floor with companies that don’t offer paid vacation, and those companies will have to adapt in order to compete and stay in business.

Rep. Grayson would do far more good taking his profits from starting IDT (with annual revenue in excess of $2 billion) and investing in companies offering paid vacation, or using his influence in the numerous companies in which he has significant ownership to force them to offer paid vacation. That way, if he’s right, he’ll make even more money, but, if he’s wrong, he’ll lose his own money instead of forcing all investors to try his experiment with their money.

That’s the American way to do things: go out into the world and kick everyone else’s butt by being better, and change the world when your competitors try to imitate you. Did the government have to tell car companies to use a production line? No! Henry Ford went out into the world and just obliterated his competitors by making cars available to more people using a production line. Henry Ford made cars faster and cheaper, and he built a company that traditional car makers of the day simply couldn’t keep up with – Ford dominated the car market by making cheap cars. His competitors (and soon companies in other industries) copied his mass production process using an assembly line – something that is, today, used around the world. This is how Americans change the world: not through legislation.

We can hope that history records today as the start of the tax revolt of 2009 with the Vote Heard Around the World in San Francisco County.

For those of you who are unaware, today, May 19, 2009, the state of California held a special election with a bunch of propositions to increase fees and taxes in order to cover the state’s massive deficit, caused by out-of-control spending on behalf of the state government – Republicans and Democrats are all to blame for California’s huge budget mess.

Today, the citizens of California had a clear choice: Close the budget gap by enacting more fees and taxes, or close the budget gap by closing down government services. After all, Governor Schwarzenegger made it perfectly clear that the state was going to have to make serious cuts if these ballot propositions failed. One might make the argument that Californians also felt an option on the table was that if they didn’t fund it themselves, then the federal government would write them a check – but that is so despicable that I won’t even assume that the liberals out in CA would try to avoid paying taxes themselves, since they seem to think taxes for the rest of us are something we should be proud to pay.

Regardless of what motivated the voters to vote the way they did, I see glimmers of hope coming out of this election – true glimmers of hope, not the glimmers of hope Barrack Obama talks about in the economy. These are the glimmers of hope that show people are taking a stand – they have had enough, and they are saying “when.”

With 80.5 percent of the precincts reporting as of the time I write this, almost a full two-thirds of the people have voted against fees, taxes, and spending that will strap the backs of the citizens of California with so much weight that they will not be able to lift themselves out of the recession. (Note: This is important to the rest of us because CA’s economy is the 6th largest economy in the world – by itself! CA tanking is bad for us all.)

They voted no to the ridiculous propositions for the “Rainy Day” Budget Stabilization Fund, the Education Funding Payment Plan, the Lottery Modernization Act, the Children’s Services Funding, and the Mental Health Funding. All of these by more than 60%. And, to the proposition on whether or not elected officials salaries should be frozen, Californians voted approximately 75% that elected officials’ salaries should be frozen.

But we can’t count our chickens before they’re hatched. 19.8 percent of the votes still need to be counted. However, what struck me was not so much the total vote count as the count in one particular county.

San Francisco County, recognized around the nation, if not around the world, as one of the most liberal, if not THE most liberal, counties in the United States, with 100% of its votes counted, has voted against taxation (with the exception of education), and in favor of freezing the elected officials’ salaries.

I would have voted against all of the propositions to raise taxes, including education; however, if education is the one place where San Franciscans waivered, then I salute them. They voted against taxation (except for education) with “No” votes ranging from 53% to 58%. That is ASTOUNDING for this counting. Absolutely astounding, and a true glimmer of hope.

The education proposition passed 52 to 48, but in the liberal’s shining city by the bay, this is not a dramatic victory. After all, Barrack Obama received 84% of the vote only 6 short months ago.

Winning 52 to 48 is not really a victory when you consider how badly Barrack Obama beat John McCain in this county. The propositions that did fail with “No” votes ranging from 53 to 58% of the vote, however, should be hailed as the “vote heard around the world.”

No matter what the final statewide outcome, today was a fantastic day for America because of the results of the voting in San Francisco County.

Friedrich Hayek in The Road to Serfdom warned us that the road to fascism and serfdom is paved with liberal (note: “liberal” here in the classical sense of the word – of and pertaining to freedom) rhetoric, just as the road to Hell is paved with good intentions.

According to Hayek, it was De Tocqueville who succinctly put that “while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude.” It was suspicions of socialism such as the ones expressed here by De Tocqueville which forced the rise of a new kind of socialism: “democratic socialism.” However, this socialism, according to Hayek, came wrapped in the language of freedom, and, in fact, promised a “new freedom.”

This new freedom was not “freedom” as we have come to understand it from the principles of the American Revolution: freedom from taxation without representation; freedom from a tyrannical government; freedom of the press; and any of the freedoms guaranteed by the US Constitution and Bill of Rights. No, it was not this type of freedom, but, instead, an “economic freedom.” In essence, it was a promise of freedom from the toils of everyday life that are required to put a roof over your head and food in your belly. Democratic socialism promised freedom from economic hardship.

These promises of freedom from economic hardship ultimately lead to harsh fascist rule, where a person’s true freedoms (i.e. the freedoms guaranteed to us, as Americans, in the US Constitution and Bill of Rights) came to an end in pursuit of bringing about economic freedom. As anyone who has been educated in even the historical events of the last one or two generations of Americans should know, the fascist rules brought about by these promises of freedom from economic hardship brought about no such thing. In fact, poverty among the common people in the Soviet Union ran rampant. The Soviets were unable to afford enough to cover even the very most basic human needs, and this has been shown to be a direct result of communism, which everyone agrees does not work.

In the 1980s, the United States ended what had become a full fledged war against communism under the leadership of President Ronald Reagan, who, as Margaret Thatcher said, “…ended the Cold War without firing a shot.” Ronald Reagan took the reigns from Jimmy Carter, and quickly put an end to high taxation, government intervention, and the energy rationing of the 1970s which were thought to be a fact of American life that would exist into the foreseeable future.  Reaganomics, which, as Reagan once humorously pointed out, the media stopped using as a moniker the program once it started working, was responsible for the tremendous growth in the United States throughout the 80s, and for igniting anew the flame of passion for individualism, freedom, and a nationalism rooted in pride for the principles of individualism and freedom in the United States.

Now, less than a generation later, we are again facing the battle of collectivism versus individualism, and the collectivists are represented by a revered man who speaks with great eloquence: Barrack Obama. Barrack Obama, much in the way that collectivists before him took control of liberal (note: again, classical liberal) economies throughout the world, has wrapped his package of socialism in the rhetoric of freedom.

On May 23, 2008, Barrack Obama said this on the campaign trail:

“What all of us strive for is freedom as FDR described it. Political freedom. Religious freedom. But also freedom from want, and freedom from fear.”

“Freedom from want” is precisely the kind of perversion of freedom that was used in the past to bring collectivism into individualistic societies – the collectivism that destroyed the true freedoms of the people who inhabited those societies.

On May 13, 2009, speaking to ASU graduates at Sun Devil Stadium, President Barrack Obama exposed his socialism for the world, if they were listening:

“In the face of these challenges, it may be tempting to fall back on the formulas for success that have dominated these recent years. Many of you have been taught to chase after the usual brass rings: being on this “who’s who” list or that top 100 list; how much money you make and how big your corner office is; whether you have a fancy enough title or a nice enough car.”

…

“The leaders we revere, the businesses that last – they are not the result of narrow pursuit of popularity or personal advancement, but of devotion to some bigger purpose….”

Later in his speech, Obama talks about setbacks and how we shouldn’t let setbacks stop us. After all, he points out, “look to history…. Colonel Sanders didn’t open up his first Kentucky Fried Chicken until he was in his sixties.”

There is no question about what Obama is saying here: forget about your own success, at least in the terms of success as a capitalist society like the United States would define success, and instead devote yourself to a “bigger purpose” or common good. He would prefer that people are devoted to the collective US population above themselves. This, by definition, is collectivism.

And what “great purpose” was Colonel Sanders after? Did he want to make sure everyone in America got to have some of his fried chicken? Did Sanders sell his chicken at cost, or even at a loss to help those in need? No. Colonel Sanders started KFC because he wanted to make money. He was chasing one of the “usual brass rings.” And he was successful. Rumor has it that KFC – after nothing more than profit – has lasted. Obama’s own example refutes his point.

This, my friends, is the face of socialism. Friendly and magnanimous as this face of socialism may seem, the belly of socialism would like nothing more than for this face of socialism to take you into its mouth, grind you up (stripping you of your freedom) and consume you in its bile.

It is said that “those who forget the lessons of history are doomed to repeat it.” I, for one, do not want to be sitting in one of the gas lines of the 1970s, and don’t want to be ruled by a fascist government like we have seen around the world after this family-friendly face of socialism has reared its ugly head.

Beware of what is to come. Socialism may sound appealing, but we know where it ends.

Imagine an America where contracts were only valid so long as the political winds out of the District of Columbia blew in the right direction: a world where the government could circumvent any contract that attracted the ire of politicians, or that politicians could use to redirect attention from their own failings. In such an uncertain world, who among us would put any faith in contracts, and who among us would be willing to put our livelihoods at risk on the basis that the government would protect our interests?

As uncertain as free markets may seem, certainty is one of the bedrocks of a free market system. A free market can only thrive in a moral society (note: “moral” here not necessarily in the sense of a religious morality), governed by a legal framework which establishes certainty in economic transactions. Certainty is then derived from the laws being enforced by a governing body with the authority to use force in order to enforce the rule of law, which ideally is a direct reflection of agreed upon social mores. As long as outcomes within the rule of law are known, a free market economy can then function, and market participants are able to speculate about the unknown, with known legal outcomes upon the outcome of the unknown.

We speculate every day. One such speculation that we all experience in our lives is the speculation about our worth in the workplace. As employees, we believe that our services have value, and we demand to be paid for the value of our services. We know that we will do our best and that we will provide value to the company, but the prospective employer can’t possibly know what type of employee we will turn out to be. When we agree to work for a company, we take on some amount of risk: what if the person offering us a job has lied to us about how much we will be paid? What if our job will be different than described during the interview process? On the flip side, the employer also has risks: What if the employee doesn’t work the full time for which he is paid? What if the employee is dishonest and steals from the company?

To solve these issues and to help mitigate risks associated with employment, the employer and employee enter into a contract. The employer specifies salary and job requirements, and the employee agrees to perform services in a manner as defined by the employer. Both sides gain some amount of certainty from having agreed to a contract.

Employment, like all contracts, can only exist in a moral society with a well-defined rule of law, and here is why: If no social mores exist by which the majority of people function, neither party will trust that the other party will perform on the contract, yielding the contract ineffective on its face. A rule of law cannot compensate for a lack of social mores, because adjudicating contracts is not costless – someone must pay for attorneys, judges, court clerks, courthouses, officers of the court to enforce judgments, etc. At the margins, people will not enter into contracts if they believe they will have to resort to the legal system to resolve a dispute, because they cannot afford the very real costs of having an issue adjudicated. Without morality, the odds of reliance on the legal system increase. However, in a moral society, the rule of law ensures that the few who do not abide by social mores will be forced to comply, and, thus, odds are that contracts will be honored sans adjudication. Both morality and rule of law are necessary, but individually insufficient conditions to ensure a proper framework for contracts to exist.

Recently, there has been much ado about the bonuses given to AIG executives: bonuses that were contractually agreed upon by both AIG and the individuals who were given bonuses. These were not, by all accounts, discretionary bonuses that AIG lavished upon these executives, but contractually owed bonuses of a specified amount, which AIG could not legally alter. To be sure, AIG didn’t pay these executives in excess of what surely was a guaranteed minimum bonus. Most likely, AIG had discretion to pay these executives more than the minimum, but, given the performance of the company, AIG did not pay in excess of the bare minimum.

For the past few days, the news media has not been able to stop covering these bonuses. In fact, the news media continues to beat the war drum against these “greedy” executives, all but demanding that something be done about these “outrageous” bonuses. Fox News’ Greta Van Susteren, who is… ahem … a lawyer, vows to “get to the bottom” of how we let these bonuses be paid. I guess the fact that these are contractually owed bonuses eludes this lawyer.

It is our own greed and envy that outrages us about these bonuses. What’s worse is that, because we, as taxpayers, have taken 80% ownership in AIG, we feel that we have the right to control the company and demand that these bonuses not be paid. We feel a certain amount, and rightfully so, of righteous indignation that our tax dollars are going to pay the bonuses of people who were involved in running AIG into the ground, but our greed and envy are distracting our attention from the people who are truly deserving of our ire. In fact, one might think that politicians are intentionally calling our attention to these trivial bonuses, which account for less than one-tenth of one percent of the money allotted to AIG, so that we will not focus on the fact that the government is busily spending us into debt and circumventing laws that were established to keep us all safe from the government intervening in our lives.

We should be angry at the politicians who bailed out a company so wrought with mismanagement, not at the company or at the executives who received these bonuses. The free market allows for failure: in fact, failure is like a disease that causes illness but eventually is fought off by the body, which then has antibodies to fight the disease in the future. When the government intervenes, it causes the same problems caused by the over-prescription of antibiotics, which causes the disease to mutate such that fighting it off in the future becomes ever more difficult. Our anger should be focused on the very politicians who are distracting us by pointing to some trivial amount of money given out as bonuses.

We should be even more angry at politicians who speak of finding “legal avenues” to circumvent the rule of law. If even one private contract is circumvented by the government, then all contracts are at risk of being impaired by the government. Our greed and envy may lead us to believe that it’s right to punish these few individuals who received more money than most Americans will see in a lifetime as a bonus for a single year’s work, especially when that work resulted in laying the groundwork for the company’s failure, but we must remember that the rule of law is essential to a properly functioning economy, and that we wouldn’t want the government interfering in our contracts.

What if, for example, the government decided that non-hybrid vehicles are not being sold at a price that politicians feel accounts for the social costs of those cars and increases the amount you, as a non-hybrid car owner, owe for the car? “Absurd!” you say “The government can’t do that!”

Oh, but they can. What if anyone who owns a non-hybrid car suddenly becomes subject to a new tax for non-hybrid car ownership – even if you purchased the car 10 years ago? You might think this was unfair; that had you known this when you were purchasing a car, you might not have purchased the car. You’d probably think it was unfair that the government passed this law after you purchased the car.

You’d be right to be upset, because this is exactly what the Constitution attempts to avoid in Article I, Section 9 where it states, “No bill of attainder or ex post facto Law shall be passed.” Such a tax would, de facto, be an ex post facto law. Such laws are unconstitutional.

Well, what of the solution that Congress is discussing to “rectify” the AIG situation? Senate Banking Committee Chairman Chris Dodd (D-Conn.) has recommended levying a draconian and confiscatory tax aimed at only AIG executives who received this bonus. Such a tax, so directed at these specific individuals for the sole purpose of circumventing a legally valid and binding contract is, de facto, and ex post facto law. We, as Americans, no matter how disgusted we are by the fact that we are bailing out AIG, cannot stand for the government violating the Constitution to enforce some notion of cosmic justice, because it undermines the very principles upon which the country was founded, and which allow our free market economy to function.

We are moving toward living in an ex post facto world: a world where we address symptoms rather than illnesses; a world where the rule of law changes on a daily basis based on how we feel about outcomes rather than a world where we enforce a rule of law established to make sure everyone plays by the same rules. Such a world is not only an ex post facto world, but an ad hoc world, malleable by the political process, changing daily, and wholly unstable to support a free market economy.

We are being persuaded, both by our politicians and the media, to focus on outcomes, which are mere symptoms of the underlying illnesses causing them. Too often the conversation about “equality” focuses on equality of outcomes, rather than equality of opportunity. We look at those things we see that make us feel wronged, and try to right them, instead of understanding what caused them in the first place. In AIG’s case, it was government intervention that allowed these bonuses to be made. Had the government allowed the rule of law – the system that ensures we all play by the same rules – to solve AIG’s financial woes, AIG would have entered into bankruptcy, ruled by bankruptcy law, and a judge could have legally invalidated the contracts for guaranteed bonuses, in favor of paying AIG’s debt holders and shareholders. Problem solved.

It is precisely government intervention in the free market that has caused this problem. Allowing the government to fix the problem by circumventing private contracts and directly violating the Constitution only creates systemic problems that will certainly cause more problems in the future, because it will create an ex post facto world, and an ex post facto economy.

In an article entitled “A War You Can Stop”, David Frum a resident at the American Enterprise Institute argues that drug users are to blame for gang violence and the devastation that is currently ongoing in Mexico and in border states such as Arizona, whose capital city, Phoenix, was second in the world last year in kidnappings, second only to Mexico City.

Frum says: “Every time a North American indulges in illegal drug use, that user subsidizes and incentivizes the gangsters who dump charred, decapitated bodies in Mexico’s cities. It’s our buying that creates the profits for which the gangsters kill. An estimated 2.8% of American adults and 2.3% of Canadians use cocaine at least once a year. If they quit, they’d put the gangsters out of business. This is one war that ordinary individuals have the power to stop. So here’s a challenge next time you meet a campus peace activist. Ask them: What are you doing to put an end to this murderous trade?”

I agree with Frum that if Americans would stop using drugs, the drug lords in Mexico would stop making drugs for export to the United States, and there would be less drug related killings in the United States.

Realistically, can we expect that Americans stop using drugs? For anyone who truly believes that drugs can be successfully eradicated in the United States, I ask you this one question: How can we possibly keep drugs out of the hands of free men and women when inmates (who have very limited rights and freedom) can get drugs in prisons?

I doubt there’s much debate among the well educated that drugs are detrimental to a drug user’s health, but can we stop drug use any better than we can stop people from over eating, over exercising, bulimia, gambling, or any number of behaviors which are detrimental to physical and mental well being? If someone wants drugs, they will get drugs: End of story. Until we find a way to affect free will, we must accept that some people will want to use drugs.

What if instead of fighting the drug war by trying to end demand and throw suppliers in prison, we allowed Americans to produce and sell drugs? What if we used good old fashioned competition to drive Mexican drug lords out of business?

Today, drug s are sold at a massive premium to cost of production in order to cover the costs of drug seizures, death squads like the ones mentioned in Frum’s article, and other risks associated with dealing in an illicit industry. That premium makes drugs a desirable business to nefarious people: people who would stop at nothing – not even murder – in order to sell their products and protect their business.

If drugs were decriminalized in the United States, the prices would drop, the quality of drugs would increase, and the war on drugs would no longer exist. Best of all, nefarious people who currently run the drug businesses couldn’t afford to carry on as they do now, and they couldn’t fund the death squads and purchase of government officials that currently wreak havoc on civil societies around the world.

The single quickest way to end the war on drugs is to simply end the war on drugs: decriminalize drug use/production, tax the sale of drugs, and allow Americans the freedom to choose what they do with their bodies. If we really wanted to, we could take all the profits from taxing drugs and put those monies towards drug prevention and education programs.

If we end the war on drugs, we’re still faced with the same education and prevention problems that we face today; however, we don’t have to expend the resources on the drug war: Our prisons would not be overrun with criminals whose only crime is drug use; Our law enforcement officers would not die in gunfights with drug lords, gangs would have to find other means of funding their violence; Drug-related kidnappings would decrease; and, most of all, we’d be allowing people to choose for themselves if they wanted to use drugs.

Frum and I both agree this is a war to be fought economically – a war to be fought using the power of economics and incentives. Where we disagree is on which incentives to use in the fight. Frum wants to essentially guilt people into ending their drug use. I want to unleash the power of the free market on drugs, so that every individual has an incentive to start a business selling drugs, until competition has reduced the profit of the drug business such that the extraordinary profits that buy off our law enforcement agencies and corrupt our country cease to exist. We can always fight to win the hearts and minds of those prone to drug use, but wouldn’t that be easier to do if we weren’t squandering our resources and the lives lost in the drug war fighting a war that has no end?

See Frum’s full article here:

http://www.aei.org/publications/filter.all,pubID.29542/pub_detail.asp