political corruption

According to the BBC, today both Tories and Lib Dems will formally outline their current plans for dealing with the regulation of the banking sector in a post election world. Neither, it seems, are prepared to think "outside the box" as that early century cliche went: the Tories looking at returning banking oversight to the Bank of England, whence it came a few years ago, the Lib Dems more firm on plans to break up the biggest banks, starting at least with the ones in de facto public ownership. However, one thing we can be pretty sure of: neither will be proposing the single most important possible change to banking that would do the most to stabilize the money system and longer term the economy...Free Banking.

As a concept it's pretty simple: Free Banking is where banks, and potentially other organizations such as communities, trading companies and so on, issue their own currencies instead of trading in the "national" currency of the territory in which they are operating. These currencies compete against each other for users. The value of each rests solely on the soundness of the business practices of the organization issuing them. If one bank/issuer over-extends itself all the others who would normally accept their currency at par with their own (say when a business customer of theirs tries to deposit them at the end of each day) will want to pay less for them and the message will soon get round that the over-extended bank needs to change its business practices, its risk profile say, or risk complete devaluation of its issued currency. There are also lots of other mechanisms that, in a free market, but not a fiat system, would come into play to ensure the currency issuers play responsibly.

The system we have today, fiat currency "guaranteed" by the nation is whose name it is issued, is the result of a long term grab for power by the state. Why would they do that, in a market that functioned quite well? Well, there are profits to be had in issuing currency - so called "seignorage". However in the current system where fiat money tends to be introduced via lending by the commercial banks regulated to do so this seignorage profit has reduced, and has also been passed to those issuing banks rather than to the state. The big reason is inflation. We take it as axiomatic that inflation can be a good thing, if you are in debt. With your future repayments more or less fixed in numerical terms if you can inflate the money supply your payments will tend to fall in real terms with time.

Who are the biggest single borrowers in our economy? Well usually the government. So the government can inflate away the running costs of their debt. Well, okay, says you, but it also eats into the costs of everyone else's debt too, doesn't it - so we all benefit from inflation, right? Wrong. Lots of us may well be in debt, but after many decades of inflation and only a few of burgeoning private debt, the lenders have become savvy to this. How many of you are now on variable rate mortgages? Government induced inflation really assists really long term borrowers on fixed rates (ie gilt issuers predominantly).

And on that subject, on the other side of the coin, if you pardon the pun, inflation erodes savings. All of us need some of those, even if we are in debt - for example for our retirement. Inflation keeps eating into our pension funds - firms and returns have to grow faster in monetary terms just to maintain the value of our savings. But equally, if inflation undermines our savings, so it also undermines the money we have in our pockets now. If we think the prices are going to go up, we want to buy more now. Inflation actually drives us into more debt, transferring more in interest from less well off to the better off lenders, so we can buy now before the prices rise.

But inflation also distorts in all sorts of other ways - if it is more difficult for us to work out as individuals whether we should borrow to buy that new Hi-fi today and pay the interest, or wait until we don't need to borrow because it will still be there at the same, or perhaps a lower price, how much more difficult is it for people who have to make borrowing decisions about investing in capital goods? Inflation corrupts the signals that prices are sending to manufacturers for example - they don't know necessarily whether they are getting a better price because of inflation or because their product is in greater demand.

Since the US finally adopted central bank run currency, followed by a fully fiat monetary system a few years later, the state has overseen a devaluation in the currency of over 98% - roughly a period of a hundred years; the Federal Reserve system was established in 1913. But this most recent decade shows the problem at work perfectly and the government's part in it. At least until 1997 the government, through the regular collaboration between the Treasury and the Bank of England, was instrumental in setting the base rate as we call it here. That is used to create a signal to all the banks who are regulated to lend in sterling that they should lend more, if the base rate goes down, or lend less, perhaps call in loans, if the base rate goes up.

After the political turmoil caused by the events of "Black Wednesday" when speculation against the pound led the government to raise interest rates three times and to 15% at one point, we were left with hundreds of thousands of households who could no longer afford their mortgages. A housing slump ensued and led to a policy for the next few years of keeping interest rates as low as possible - lower probably than the economy deserved. Just as the housing market was getting back to relative values from before that crash, another asset was bubbling - the "dot com" stocks and shares.

When that bubble burst, there was a great concern in Treasuries on both sides of the Atlantic that the burst would turn to recession (and indeed it did in the US). Gordon Brown in the UK was so concerned that Labour's first term in twenty years would end with a recession that again base rates were kept artificially low, signaling to the commercial banks that were part of this cosy central-commercial bank cartel that they should lend even more, even more irresponsibly, and we had the housing price bubble that has resulted in the current economic carnage. All the way up that price bubble the least well off are encouraged to transfer more of their wealth to the lenders and now, all the way down, that cosy relationship means that the banks, the lenders, are the ones being baled out while everyone else will suffer vast capital losses with no compensation.

And finally, central banking and its bastard daughter inflation kills. Literally. You'll notice that the history of central banking has been closely related to when government wanted to borrow to fight wars. In the past century, more of this has been done via inflation than by direct government borrowing. If there's an inflationary surplus already in the economy, go to war, destroy some capital goods, and with it some human capital and all of a sudden there are things to spend that surplus inflationary money on. If you are already n a war, perhaps an unpopular one, and you cannot finance it via extra taxes or selling debt, inflate, inflate, inflate and you'll be able to buy up your war-goods before everyone else sees the inflation in the form of a reduction in the value of their money.

So, which of Vince, or George, will take such a brave step? Of course, we know the answer - what they really want of course is for themselves to be in charge of this vast power inflation gives. But wouldn't it be great if just for once, politicians made the right policy decision for us not them.

Those of us who quite like the idea of anarchism, or to use a word I've heard used more frequently recently and which rather neatly it seems to me gets round the inevitable comparison with bomb throwing revolutionaries, Spanish priest killers or G20 violent-left credentialed academics when unsympathetic folk hear the "hot button" word "anarchy", "voluntarism", are frequently goaded with taunts such as "look at Somalia, look at how great your ideal of anarchism is doing there (not)! Explain that if you think anarchism is such a great alternative.". Or even "why don't you go live in Mogadishu if you think anarchism is so good?"

Well in the past I have really tended to wave away such taunts with something along the lines of "that's not really a great example of the sort of thing we mean, because it only arose out of the complete and unplanned collapse of a previous totalitarian regime with no time, as we would want to have if we were deliberately introducing anarchism here in a developed country, to develop those alternative sorts of institutions that we would probably expect to replace state run public goods like security and rule of law."

Nonetheless it is an example of a country that has been essentially stateless for much of the past two decades, and which continues to be in the headlines now and again, whether over piracy, as recently, asylum seeking or the scene of a shambles of a US attempted invasion popularized by a Hollywood action adventure blockbuster. So I figured it deserves a closer inspection. Also, though, as I grow ever more impatient to sack all the politicians and bureaucrats that currently are making such a destructive hash of ruling us, I think it is actually an interesting experiment to consider how it might pan out here if we were to manage to achieve an unplanned revolutionary change.

The first thing to consider is what expectations we should have when looking at Somalia as such an example. Those who taunt supporters of voluntarism with Somalia seem to expect a miracle and are trying to suggest that voluntarism has obviously failed because people dont't live forever, all drive around in Bentleys, have rosy cheeked children dreaming of graduating from the world class University of Mogadishu into world leading management consultancy firms and have the highest standard of living on the planet. But this is to mistake the claims made for the superiority of voluntarist statelessness. We only claim that in a cost-benefit analysis statelessness would do better for any given group of people than a statist society. If somewhere was more or less a shithole with a government we would want it of course to be less of a shithole without and, one would hope, on a trajectory of development and improvement that would see it advance more quickly and to a higher level than with a government. We would, I think, agree that to expect somwhere to go from armpit of the planet to surpassing the standard of living of some Monaco style playground of the world's wealthiest would be unreasonable. Wouldn't we?

So, can such claims for the superiority of statelessness be demonstrated by the Somali example? Well, before considering that a little history of the place is called for. Let's face it, Somalia was not merely in the "bit of a shithole" category in the years preceeding the period of statelessness: it was one of the worst. Even in a period when there were rivals such as Congo's Mobutu vying for the title of the regime with the worst record on human rights, the era of Uganda's Amin and other such paragons of sound government sharing the continent, that of Siad Barre in Somalia was described by the United Nations as "one of the worst". Barre had run a totalitarian "scientific socialist" regime for his first ten years and then as the western aligned powers tried to butter him up to end his reliance on the Soviet bloc he had slowly introduced a few economic, in the main reforms.

He was still a complete bastard. In a country with a clan system that goes back millennia he was ruthless in persecuting those of clans other than his own. There was massive corruption and lotos of world aid ending up in the hands of his favourites. "Gossip" was a capital offense. Not that you would notice it since his internal militia just killed people they didn't like the look of anyway. He had complete control of the media - with just one state owned newspaper for example. There were hundreds of thousands of internally displaced people as he made frequent land grabs to give to his friends and more refugees over the border in Ethiopia. Of course we didn't hear so much about all this because those who would speak out were terminated before they could.

Apart from the short nine year period between independence from Italy and Britain in 1960, Barre's rule was pretty well the only time this "counry" had existed as a monocentric governed state. These two colonial powers had suppressed traditional clan based polycentric natural and property law based justice systems that had survived successfully operating for eleven hundred years regardless of which Caliph had claimed what bits of the territory.

So, has the ensuing statelessness made things better or worse? And if better, has it been better than what might have been expected had a more controlled, humane, government been in charge? Well, first of all, you probably wouldn't consider the immediate aftermath of Barre's overthrow an "anarchy". It was a state of civil war, in which those warlords who had collaborated in overthrowing Barre fought to get to form a new government. But when that fizzled out in stalemate, despite interventions from the "international community" on one side or another, real statelessness set in. Of course quite a number of the positive studies of the benefits of the statelessness are by people with something to prove about anarchism - libertarian authors who could be said to have a bias toward showing statelessness in its best light. But I'd encourage you to read this one by Austrian economist Peter Leeson - it's only 33 pages of double line spaced text and appears quite methodologically sound to me.

Nonetheless, the World Bank (in a report co-authored by Tim Harford), The Economist, the BBC and National Geographic are amongst the more unbiased positive studies of various aspects of the working of markets to provide many public goods not available under Barre's regime. Indeed the World Bank report states that "Somalia boasts lower rates of extreme poverty and, in some cases, better infrastructure than richer countries in Africa". In telecommunications, electricity generation (at least in the urban areas), air transport and financial services, sophisticated markets, unburdened by regulation (and sometimes "buying in" regulatory services such as with airlines all safety checks are contracted out to the destination countries' civil aviation regimes) have flourished and are amongst the cheapest on the continent. There is a thriving competitive media with a dozen radio and TV stations and many newspapers. Cross border cattle trade has more than doubled - and the insurance contracts required by Kenyan buyers to assure them that cattle are not stolen have lower premiums even than those paid by Kenyan sellers.

Literacy is high, even though schooling has fallen (though before 1991 all schooling was being funded by international aid money which has fallen off rapidly because the "international community" cannot cope with the idea of a stateless entity - there is no government, corrupt or otherwise, to do aid deals with. Nonetheless private primary education is taking off, and there are now three universities where there was only one. Life expectancy is higher than in its relatively "stable government" neighbours, as is access to medical care, even though it is private. Infant mortality and maternal mortality in childbirth are both lower compared with their regional neighbours.

The clan system of extended family support for the destitute has kicked back into life - so although access to safe water is lower than in its neighbours, the poorest do not pay because their clans arrange that for them. The Somali diaspora remits nearly a quarter of the entire GDP through a network of unofficial but quite sophisticated money transfer agencies operating internationally - a little like a Somali version of Western Union. Homicide is, if I understand the measure correctly, down to 4% as a cause of death, compared with 3.6% in parts of the USA.

In fact, the periods between 1992 and today which have seen most turmoil have been those in which the "international community" has taken it upon itself to say "enough is enough, you need a government and we're going to help impose one". When there is a chance of a government, the war-lords start fighting again hoping to get the upper hand. When the energy for the establishment of a government fizzles out they go back to looking after their clan based interests and leaving the others alone. The ancient polycentric "Xeer" system of clan justice, based, as mentioned above, on restitution for property loss and natural law has which was by all accounts a very humane legal system has been usurped for the moment by the allegedly more brutal Shari'a based Islamic Courts Union with its Shari'a emphasis on codified punishments and we do get to hear about summary and brutal justice being doled out on occasion. But when we consider where they have come from under Barre's brutal regime even that is an improvement.

In conclusion then, yes, Somalia is still in the "bit of a shithole" category. Yes, it confuses the hell out of governments and international organizations around the world to have a state without a government and they keep trying to interfere to impose one. It is probably not yet the sort of place you would tend to want to go for an Indian Ocean holiday, let alone to settle in some kind of a global "Free State Project". But on the basis that we claim market anarchy is not a miracle cure, but merely better than government based institutions operating under similar constraints of national natural and human capital, it certainly looks as though the period of statelessness has seen many improvements in Somalia, and improvements that have come more quickly than in comparable neighbouring countries with functioning governments.

They still face enormous challenges of course, not the least of which is the continual hand-wringing of the "international community" desperate to try and help impose some state apparatus from time to time. But maybe, just maybe, if that "international community" can refrain from attempted power-broking and limit themselves to things like trying to persuade the traditional courts system or the Islamic Courts Union to take responsibility for dealing with the likes of the pirate problem - since it would be in their interests to do so if it keeps the heavy hand of government imposed from without away from them - perhaps Somalia can continue to prove that statelessness can bring bigger faster improvement than governments can.

A peerage! It seems that the last speaker to be forced from office, boss-eyed Sir John Trevor in 1693, was one of those who did not get a peerage following his fall from grace, and nor should Martin. Lord Martin of Milnburn or wherever it will be should never happen. It is an affront. We all know there are people who should never have been placed in the Upper House, having failed at their elected job or even run away from re-election, but Martin has been thoroughly disgraced in the process too.

Now, don't get me wrong, this is not snobbery, George Thomas was a man from a similar background and to me thoroughly deserved the last hereditary ranking peerage to be given to a former Speaker (even though it was pretty unlikely anyone was going to inherit it anyway). But at a time also when we need desperately to change both houses of parliament (or abolish both as I would have it) this is no time to be simply patting people on the back and kicking them "upstairs".

Not one member of the commons apparently dissented from the motion that Speaker Martin should be elevated. If they are so concerned about tradition and face that they cannot see that this is one occasion in which that tradition ought not to be honoured, given the extraordinary events that have led to this, none of them deserve to wipe their arses on that green leather benching.

So, we're to get an Independent Regulator for MPs? Might I suggest the acronym "OffRAMP" - the Office of the Regulator of All Members of Parliament.

Does nobody else think this is a really bad idea. I'm sorry, we "elect" these people to run the country, to represent us in the High Court of Parliament. I realize they're looking a pretty untrustworthy bunch right now, but who, philosophically speaking, has the right to regulate or oversee those we theoretically put right there, at the top of the tree of government?

That they cannot, it seems, be trusted to regulate themselves says more about the political system than can be fixed by some kind of external regulator. As Hans-Hermann Hoppe puts it:

"Free entry and competition is not always good. Competition in the production of goods is good, but competition in the production of bads is not. Free competition in killing, stealing, counterfeiting, or swindling, for instance, is not good; it is worse than bad. Yet this is precisely what is instituted by open political competition, i.e., democracy."

Basically our system of government is so undermined and the problems facing the country so great that I do not any longer believe that parliament can fix this on its own. As regular readers will know I'd personally prefer to do without them entirely. Their infantilizing tendency is a drain on the country and their propensity to claim to be able to act on almost any issue in all our names is repugnant to me. Putting this right cannot be the work of a general election process, as parliamentary reform will be subsumed within a mish-mash of policies covering every area pressing the country and there is a grave danger that any parliament so elected will feel itself cleansed and only needing minor tweaks to rebuild confidence.

This must not be allowed to happen. The combination of the contempt in which parliament is now widely held by the people of Britain and the economic situation is, to me, an unprecedented and unmissable opportunity for the widest reforms since 1649. I believe that a centralized parliament at Westminster and a government accruing more and more powers is no longer required in the 21st century, having evolved throughout eras where even travel within Britain was difficult and when the monarchial system required ministers to be physically at court in order to advise and have laws approved.

Central government is no longer even a "necessary evil" to me but an unmitigated disaster that does more harm than good to this country and the freedom, prosperity and happiness of its people. And this is an opportunity to begin to wield the grim reapers' scythe on its powers and constitution. But if members are going to vote themselves an opportunity for repentance and expiation by accepting the SNP/Plaid call for immediate dissolution and an imminent general election it must not be allowed to believe that any parliament elected is thereby cured of these ills. The new parliament must have only one effective function - to be a temporary body in which to agree the ground rules for the new Britain that will take us into the twenty first century as a modern nation of sovereign individuals requiring as little government as possible, and so I put forward the following amendment to next week's debate:

1. Lest any parliament elected as a result of this Act consider itself to have been cleansed of miscreants and absolved of blame, it is hereby enacted that this parliament shall sit for no more than one year, and shall be dissolved on a date to be decided by said parliament but in any event not after 9th July 2010.

2. That the sole purposes and business of this parliament shall be to:

• a) oversee and co-ordinate the process of research, consultation and formulation of new constitutional arrangements to apply to future legislative and government institutions;

• b) agree by a two thirds majority a definitive declaration of the economic and fiscal problems facing the country in order that in any future election the electorate will be able to know that proposals for economic and fiscal policy to deal with these issues are based on a common understanding of what the problems actually are.

3. In respect of 2.a) consideration of constitutional reforms to include, inter alia:

• i) reformation of the methods of election of members of all parliaments, assemblies and local government bodies throughout the United Kingdom;

• ii) reform of the methods of selection or election of individuals carrying executive responsibility in any part of the governance of the United Kingdom;

• iii) the introduction of fixed term parliaments;

• iv) the introduction of an English Parliament;

• v) the abolition of parliament;

• vi) reform of the second chamber;

• vii) abolition of the second chamber;

• viii) devolution of any or all powers and competencies of parliament and ministers to government structures closer to the electorate, including structures not heretofore in existence that may be recommended by these reforms;

• ix) widespread reformation of those local levels of government to enable them to take on new roles devolved from Westminster;

and

• x) any other matter referred to the parliamentary commission on petition of more than one hundred thousand (100,000) ordinary electors of the United Kingdom.

4. In respect of 3.

• a) that members of all political parties who have contested national level election in the past two parliaments be invited to participate in these reviews on an equal footing with members elected at the forthcoming election;

• b) that professional experts in constitutional arrangements in other countries and in political science more generally be invited to participate;

• c) that leaders of each existing local authority and their opposition lead members be convened to a parallel reform body co-ordinated by the Local Government Association to be consulted by and to propose initiatives to the parliamentary commission on reform;

• d) That local groups of interested citizens be formed to scrutinize the work at all stages and to be consulted on all proposals

• e) If the new consitutional arrangement call for a parliament to be elected at Westminster, elections to said parliament under the new arrangements will take place not earlier than 10th October 2010 and not later than 31st October 2010.

5. That on or before the last day of the incoming parliament as in 1) above a series of options numbering no fewer than two and no more than three presented by the parliament and, with the consent of both houses, up to a further two options presented by petition of half a million (500,000) electors or more shall be put to the electors of the United Kingdom in a referendum conducted under a preferential voting system in which the option achieving 50% or more of the votes cast in the referendum, or, if none, the first to achieve 50% after elimination of the least favoured options and transfer of their votes to remaining options shall become the initial constitutional arrangements with effect from 10th July 2010.

6. In respect of 2.b)

• a) agreement of a majority of two thirds of the interim parliament shall be required to confirm the list of economic and fiscal problems;

• b) if, by a date no later than 28 days before the end of this parliament, 10th June 2010, no agreement has been reached by a two thirds majority of the parliament, the session on that day shall not rise until it is able to reach a two thirds majority, with no adjournment for refreshment or rest after midnight on 10th June 2010.

Does anyone know whether there is precedent for changing Chancellor of the Exchequer between the budget and the Finance Bill passing all its parliamentary stages? This year's hasn't made it through the legislature yet has it?

The time has come to pass as it was written in the year of our lord Sixteen hundred and ninety, and in the second year of the reign of our glorious sovereign majesty William, Stadtholder of Holland, Prince of Orange and Count of Nassau-Dillenburg and his Queen, Mary; King and Queen of England, Scotland, France and Ireland, Defenders of the Faith, etc. by Mr John Locke:

222. The reason why men enter into society, is the preservation of their property; and the end why they chuse and authorize a legislative, is, that there may be laws made, and rules set, as guards and fences to the properties of all the members of the society, to limit the power, and moderate the dominion, of every part and member of the society: for since it can never be supposed to be the will of the society, that the legislative should have a power to destroy that which every one designs to secure, by entering into society, and for which the people submitted themselves to legislators of their own making; whenever the legislators endeavour to take away, and destroy the property of the people, or to reduce them to slavery under arbitrary power, they put themselves into a state of war with the people, who are thereupon absolved from any farther obedience, and are left to the common refuge, which God hath provided for all men, against force and violence. Whensoever therefore the legislative shall transgress this fundamental rule of society; and either by ambition, fear, folly or corruption, endeavour to grasp themselves, or put into the hands of any other, an absolute power over the lives, liberties, and estates of the people; by this breach of trust they forfeit the power the people had put into their hands for quite contrary ends, and it devolves to the people, who. have a right to resume their original liberty, and, by the establishment of a new legislative, (such as they shall think fit) provide for their own safety and security, which is the end for which they are in society. What I have said here, concerning the legislative in general, holds true also concerning the supreme executor, who having a double trust put in him, both to have a part in the legislative, and the supreme execution of the law, acts against both, when he goes about to set up his own arbitrary will as the law of the society. He acts also contrary to his trust, when he either employs the force, treasure, and offices of the society, to corrupt the representatives, and gain them to his purposes; or openly preengages the electors, and prescribes to their choice, such, whom he has, by sollicitations, threats, promises, or otherwise, won to his designs; and employs them to bring in such, who have promised before-hand what to vote, and what to enact. Thus to regulate candidates and electors, and new-model the ways of election, what is it but to cut up the government by the roots, and poison the very fountain of public security? for the people having reserved to themselves the choice of their representatives, as the fence to their properties, could do it for no other end, but that they might always be freely chosen, and so chosen, freely act, and advise, as the necessity of the common-wealth, and the public good should, upon examination, and mature debate, be judged to require. This, those who give their votes before they hear the debate, and have weighed the reasons on all sides, are not capable of doing. To prepare such an assembly as this, and endeavour to set up the declared abettors of his own will, for the true representatives of the people, and the law-makers of the society, is certainly as great a breach of trust, and as perfect a declaration of a design to subvert the government, as is possible to be met with. To which, if one shall add rewards and punishments visibly employed to the same end, and all the arts of perverted law made use of, to take off and destroy all that stand in the way of such a design, and will not comply and consent to betray the liberties of their country, it will be past doubt what is doing. What power they ought to have in the society, who thus employ it contrary to the trust went along with it in its first institution, is easy to determine; and one cannot but see, that he, who has once attempted any such thing as this, cannot any longer be trusted.

[from John Locke, "The Second Treatise of Civil Government", Ch XIX "Of the Dissolution of Government", Para 222 (1690)"]

At the present government's behest we have:

• over a decade seen ordinary people robbed of their earnings through massively rising house prices and the debt money inflation created on to finance these;

• in the past year seen the result of this: further destruction of capital on a scale almost unprecedented, affecting those impoverished by the first as well as those made more wealthy;  

• seen that our own and future generations will be paying for the bitter pill with which they have tried to clean this ordure of their own making through the further attachment of our earnings, property and wealth;

• overt examples of politicians taking our money for their own frivolities under the eyes of all the others;

• a parliament reduced to a leisure club by the business management of a government desperate to get their authoritarian legislative program through further to curtail our liberties;

• and a government that has used all the patronage at its disposal to buy the votes of those elected to represent us, not them;

• had a government that has taken us into military adventures of the most unwise kind, based on lies and exaggerations and at the behest of a foreign power and which have killed many of our bravest fellow citizens.

I do not believe the good and wise Mr Locke was suggesting that it was up to the various people inside that suppurating House of Common Thieves and Accomplices to invoke the right to dissolve and choose the form and method of replacing it, perhaps especially those whose main interest is in securing power in the next parliament. He said it was up to us, the "other half" of the social contract: We The People.

To stitch up a new set of regulations to permit lesser troughings amongst themselves would be a complete travesty. We need a comprehensive and popular settlement that will not become a part of a package of hundreds of other policies in a party manifesto whose importance may vary from voter to voter and eclipse the program of change in the orders of the House.

I suggest that we have a National Government beginning as soon as possible, with, effectively, only one task: to consult as widely as possible with the people of Britain on a new constitution, new forms of government and representation, to include the powers and competencies of national, local and community level governance, and to produce a short list of different constitutional options to be voted on by the people in a referendum.

If we can be trusted to choose from thousands of hopefuls to dance or sing or otherwise perform before our monarch in a variety show, we can surely manage to sift through the various options and priorities and put together a constitution worthy of Her Majesty's signature.

A Zero Based State! By the people and from the people. Vive la Revolution!

You know, I don't understand why everyone is getting so upset about troughing MPs. Is it that we are appalled that people could be so blatant in taking our money for their own use? Or is it that we are disappointed that the real purpose of democratic politics has been revealed to us and having naively put our trust in it all our illusions are now shattered?

After all what else is multi-party democracy other than an open competition amongst different groups of people who want to command for themselves the vast resources government takes from us. That the extent of this has now been shown to reach such personal use of those resources should hardly surprise us.

Last night I was listening, via the magic of my new pride and joy, my iPhone, to a lecture by the market anarchist Austrian economist Hans-Hermann Hoppe, most of the substance of which he had covered in his speech last year at the Libertarian Alliance conference in London. My iPhone entertainment was a lecture entitled "The Impossibility of Limited Government" and you can read it at the Mises Institute's website or download the podcast (which I recommend because in places it's actually quite sardonically funny).

It seems even market fundamentalists believe that there are limits to the benefits of competition. Here's the most salient passage applicable to our troughing MPs:

Moreover, because the Constitution provided explicitly for "open entry" into state government — anyone could become a member of Congress, president, or a Supreme Court judge — resistance against state property invasions declined; and as the result of "open political competition" the entire character structure of society became distorted, and more and more bad characters rose to the top.[12]

Free entry and competition is not always good. Competition in the production of goods is good, but competition in the production of bads is not. Free competition in killing, stealing, counterfeiting, or swindling, for instance, is not good; it is worse than bad. Yet this is precisely what is instituted by open political competition, i.e., democracy.

In every society, people who covet another man's property exist, but in most cases people learn not to act on this desire or even feel ashamed for entertaining it.[13] In an anarchocapitalist society in particular, anyone acting on such a desire is considered a criminal and is suppressed by physical violence. Under monarchical rule, by contrast, only one person — the king — can act on his desire for another man's property, and it is this that makes him a potential threat. However, because only he can expropriate while everyone else is forbidden to do likewise, a king's every action will be regarded with utmost suspicion.[14] Moreover, the selection of a king is by accident of his noble birth. His only characteristic qualification is his upbringing as a future king and preserver of the dynasty and its possessions. This does not assure that he will not be evil, of course; at the same time, however, it does not preclude that a king might actually be a harmless dilettante or even a decent person.

In distinct contrast, by freeing up entry into government, the Constitution permitted anyone to openly express his desire for other men's property; indeed, owing to the constitutional guarantee of "freedom of speech," everyone is protected in so doing. Moreover, everyone is permitted to act on this desire, provided that he gains entry into government; hence, under the Constitution, everyone becomes a potential threat.

To be sure, there are people who are unafflicted by the desire to enrich themselves at the expense of others and to lord it over them; that is, there are people who wish only to work, produce, and enjoy the fruits of their labor. However, if politics — the acquisition of goods by political means (taxation and legislation) — is permitted, even these harmless people will be profoundly affected.

In order to defend themselves against attacks on their liberty and property by those who have fewer moral scruples, even these honest, hardworking people must become "political animals" and spend more and more time and energy developing their political skills. Given that the characteristics and talents required for political success — good looks, sociability, oratorical power, charisma, etc. — are distributed unequally among men, then those with these particular characteristics and skills will have a sound advantage in the competition for scarce resources (economic success) as compared with those without them.

Worse still, given that, in every society, more "have-nots" of everything worth having exist than "haves," the politically talented who have little or no inhibition against taking property and lording it over others will have a clear advantage over those with such scruples. That is, open political competition favors aggressive, hence dangerous, rather than defensive, hence harmless, political talents and will thus lead to the cultivation and perfection of the peculiar skills of demagoguery, deception, lying, opportunism, corruption, and bribery. Therefore, entrance into and success within government will become increasingly impossible for anyone hampered by moral scruples against lying and stealing.

Unlike kings then, congressmen, presidents, and Supreme Court judges do not and cannot acquire their positions accidentally. Rather, they reach their position because of their proficiency as morally uninhibited demagogues. Moreover, even outside the orbit of government, within civil society, individuals will increasingly rise to the top of economic and financial success, not on account of their productive or entrepreneurial talents or even their superior defensive political talents, but rather because of their superior skills as unscrupulous political entrepreneurs and lobbyists. Thus, the Constitution virtually assures that exclusively dangerous men will rise to the pinnacle of government power and that moral behavior and ethical standards will tend to decline and deteriorate over all.

[from Hans-Hermann Hoppe; "On the Impossibility of Limited Government and the Prospects for a Second American Revolution"]

So, let us not be angry at our conspicuously greedy MPs; let's instead be grateful that they have exposed at last the true motivation behind democracy and its participants and hangers on. Also I suspect we should not be surprised that it has taken Labour's excesses to expose much of this. After all, Tories, and Whigs, and Liberals, have had many centuries developing their pick-pocketing style, it had to be these brash, clumsy, nouveuax elites who would get carried away, as if they thought they had to catch up with these others' centuries of pilfering in one term in case they never got the chance again (which may now very well be true of course).

Just last week I saw a piece by Stuart White at the Next Left blog saying that

...one claim made by some on the right (not all) [Jock: I'd argue not "right" but "libertarian" and therefore the true "left"] is this: at base, all people are really just selfish bastards who never miss an opportunity to maximize their own income and wealth. Even very moderate social democrats, who hold to a less radical egalitarianism than, say, Jerry Cohen (or John Stuart Mill), must, in all consistency, hold that it is both possible and desirable for people to run their lives on the basis of a higher principle than this.

and goes on to say that

If a Labour MP uses the expenses system in a way that deliberately maxes out what they get then, I suggest, they are acting in a way that conforms to the right-wing claim. They are not acting in their own lives on the basis of the principle which they must, in all consistency, think society as a whole both can and should live up to.

[from Stuart White; "If you're an egalitarian, how come you claimed so much in expenses?" on the Fabian Society "Next Left" blog]

Needless to say, I disagree. If a Labour MP, despite their apparent claim to the "higher principle" Stuart conjures up, can be getting up to this, does it not actually confirm the truth of the analysis of the likes of Hoppe and libertarians and anarchists past and present that we make it easier for bad men to come to rule over us, and this applies both in the political sphere and the commercial sphere by creating these power structures that maximize their opportunity to do so. Do away with the state and they'd not have this opportunity.

Let us not let the grubby system sweep this under the carpet and claim it is an aberration of otherwise good men trying to to good things. In is endemic in the system that puts a few people in charge of the vast resources they are able to steal from the rest of us. The system does not need reform. This episode has shown it for what it is, and it needs to go.

For further reading, I suggest:

"Democracy: The God That Failed - The Economics and Politics of Monarchy, Democracy and Natural Order" (Hans-Hermann Hoppe)

Perhaps now that the scandal of troughing MPs has claimed what other than the government itself must be it's biggest possible scalp in the form of forcing Michael Martin from the Speakership, this can be seen as a moment of catharsis that will precipetate the rapid resignation of many other Dishonourable Members who have been involved.

Those less dishonourable who, whilst not having had their fingers in the till themselves may have been aware of the culture of maximizing expenses amongst colleagues can really only rebuild their honour by persuading those colleagues to go.  Perhaps they could refuse to sit in the House or Committees with those tainted with scandal.  If it ends in a new "Rump Parliament" so be it.  It will soon lose all credibility, if it has any left at present and if the Palace won't dissolve it now as it should, it will have to act in such a situation.

If Gordon is not going to give us a General Election, then the immediate purging of these other suspects, whatever their rank or status in government or party is now necessary if Martin's sacrifice is not to be in vain. If they feel they can justify their behaviour they must be pressured to do so to their constituents not merely some committee in parliament.

If those honest colleagues cannot persuade them then there is no choice bit a dissolution and General Election. It's the very least that would satisfy me at least.

In the interim the Finance Bill must be put on hold or voted down. This particular Parliament no longer has amy moral right to determine how much of our money it wants to take for other activities of government now that it has shown so spectacularly how it has failed in spending even the bit they are personally accountable for.

A pox on them all! Vive la revoltion!

[Posted with iBlogger from my iPhone]

Libertarians often go on about how the state, whilst pretending to promote a free market actually more often than not corrupts that market through its own actions - protection, government contracts and so on and that this leads to the skewing of the market towards bigger corporations. I came across a good example today. The chief executive of an Oxfordshire based construction company Leadbitter (who are amongst other things building new blocks on my halls site now here at Brookes) writes for the local paper that:

The only crumb of comfort for Leadbitter is that changes in Government guidelines should soon mean the company will qualify at least to bid for large-scale, post-2011 Government projects — for example, under the Government’s Building Schools for the Future programme.

At present it is frozen out of the framework of firms that may make such bids because only companies with national coverage may do so; and that disqualifies Leadbitter. Despite being the UK’s 25th biggest builder — with offices in Plymouth, Bristol, Cardiff, Southampton, Sittingbourne, and Exeter (as well as its Abingdon HQ) – it still counts as a regional builder, not a national one.

[From Construction chief: Worst is yet to come (From The Oxford Times)]

The UK's 25th largest builder is not allowed to bid for a huge raft of government contracts. It is certainly big enough to deal with our £40m+ contracts for halls, so why not schools, say? Because the bigger firms have some clout that gets them government contracts - I can't believe that's in line with EU tendering rules, but there we go...big government, sponsoring big business, to the exclusion of local firms employing local people.

The whole of public sector procurement, from what I can see, is just the same. You'll find the same half dozen software firms appearing on shortlists for local authorities' back office systems for example. The same small group of companies bidding to take over admin functions in the public sector - in the vanguard of which is Capita, unsurprisingly founded and led by a former civil servant insider. And so on.

Do you see? This is NOT a free market. Those chosen few enjoy vast amounts of patronage and privilege at our expense - cartels and monopolies always push up prices or push down quality and we're the ones paying for all this, not only in our taxes but, if we don't work for these specially favoured companies, our jobs and livelihoods potentially.