Free Markets and Corn

More on Adam Smith and the Wealth of Nations....

Chapter 5- The Price of Commodities

Smith’s attempt at explaining how commodities are actually priced is well thought out and rather ingenious. His basic premise that real value is tied to labor is continued in this chapter. In Smith’s view the real price or value of anything is ultimately the amount of labor that goes into either its production or the amount of labor that it can be traded for. In other words, the best estimate of real value is the amount of labor it may ultimately claim in exchange.

However, in reality most exchanges are not direct barters for labor but rather involve exchanges of goods or money instead. These exchanges in Smith’s view still have their ultimate value in labor even though it is an indirect comparison. Since all goods and services are necessarily susceptible to market fluctuations this can sometimes become a hard equation to work all the way out as each exchange has to take into account the actual real price or value of the goods or services being exchanged.

Being a keen observer of the economy he saw all around him Smith hit upon the idea of finding one good or service that was more stable than others to use as a base value to judge all others against. As he explains in the book he hit upon corn as being a rather stable commodity over a long period of time as in his view it was largely analogous with the amount of labor used in its production. Smith recognized and postulated that although corn prices regularly rose and fell in rather large cycles based upon atmospheric conditions, political stability, and the lack of war; over longer periods of time corn prices were fairly stable. He surmised this was because the amount of labor involved in its production was fairly steady which gave him a ready method of computing value back to what he considered its true core.

There are numerous examples in the book where Smith used corn, at least on a time averaged basis, as the best reflection of the relative value of labor. Smith recognized that advances in methods necessarily increased corn yields but over long periods of time that he studied, he considered these advances to be relatively small and unimportant in comparison with fluctuations in other goods tied to labor. It is really a remarkable methodology that forms one of the core measurements of the true value of labor. This is in Smith’s view the most important factor to be tracked as we must remember that he considered the value of labor to be the true basis of all economic value.

It is a little ironic that the very staple Smith recognized as the best commodity to peg the true value of labor to has in modern times in this country become a powerful lobby; so powerful that there is little or no resemblance to the free market concepts Smith found to be immutable in the corn industry today. It is also ironic that some of the staunchest conservatives of free markets installed the government subsidies that forever removed corn from the influence of free markets while simultaneously allowing the creation of market monopolies by large farm corporations.

The first efforts at corn subsidies came from within the Roosevelt administration during the Great Depression. As the economy collapsed and real wages and crop prices fell to record lows there was a real danger of the collapse of agriculture as an industry. Farmers who had long relied upon credit to plant their crops found that it simply did not exist. The government, recognizing the necessity of maintaining agricultural expansion set about making efforts to stop the collapse by a two pronged approach. The first prong was to provide needed farm loans for planting crops as this was the immediate necessity to forestall collapse and wide scale starvation in the country. The second prong was an effort to modulate prices by government assisted control of supply. Farming in the US had always been a free market enterprise before this effort with years of profit followed by loss in a cycle that often led to widespread epidemics of foreclosure and boom. Farmers themselves had several times attempted to organize themselves into cooperatives to better regulate the cyclical nature of the industry but had never had the financial ability to make good on such ventures. It must be remembered that such efforts were despised by the moneyed interests in the US as encroaching socialist and communist tendencies and bankers were not slow to react to such perceived threats by tightening credit in those days.

Roosevelt’s efforts at price control consisted of encouraging farmers to hold down production in years of plenty to avoid gluts of the market which would cause prices to collapse. This amounted to stockpiling produce by government warehouses as well as paying farmers not to plant crops in some years. These methods were fairly effective as farmers began for the first time to see these damaging cyclical movements modulated so that the business became more predictable. Along with government sponsored low interest loans this stability led to farmers being able to invest in their own future by making capital outlays in the form of better equipment and more efficient planting and harvesting techniques.

Following World War II the industry took another quantum leap forward in terms of production capability when ammonium nitrates began to see widespread usage as a fertilizer. While usage of chemical fertilizers had been being experimented with for the previous century it was the confluence of an abundance of this chemical due to the large scale buildup of its production during the war for explosives and the end of the war which caused a divergence between supply and demand that led to its widespread increase as a fertilizer. Farmers soon realized that production could be vastly increased by application of this fertilizer and the government owned a large supply of it that they quickly began discounting to farmers for this usage.

This was largely the methodology of controlling agricultural markets up until the early 1970’s in this country. While it was not in fact a free market, it was closer to a free market than what we have in this country today as it was dominated by small farmers who were largely free to compete with each other and other farmers in the world in the market. This all changed in 1972 while Richard Nixon was in office.

In 1972 a large sale of grain to Russia that was brokered by the US government led to a rapid increase in grain prices across the country. Americans were incensed as food prices at the grocery store suddenly took sharp rises and demanded that the government respond. After all, the government had largely precipitated the crisis by the grain sale and it resultant clog of the agricultural national transfer system and Americans understood this. Nixon, desperate to quell this unrest as he had other problems linked to a little matter called Watergate to deal with, turned to his secretary of agriculture for an answer.

Earl Butz was raised on a depression era farm. He had been appointed Secretary of Agriculture based upon his accomplishments as a well respected professor at Purdue University and was an avid proponent of larger, more efficient farming operations. With the grain shortage and resultant outcry he saw his chance to change the system. Butz was an outspoken critic of the system Roosevelt had put in place. Having been raised on a depression era farm and seeing both the widespread hunger of the depression and the simultaneous price control efforts whereby the government paid farmers not to produce food; he could not see how such a system made sense logically. Butz believed that a more efficient system was needed and he thought he knew how to put one in place.

Butz’s ideas were as simple and straightforward as the man he was. Butz proposed that the government should control prices by simply guaranteeing a price on crops. In other words, Butz encouraged farmers to grow as much corn as possible and simply guaranteed a price that would be paid for the corn. In his words farmers should plant “from fence row to fence row” and the government would guarantee the price when it came harvest time. When critics of this plan pointed out that it would necessarily lead to monopolies of the industry by large farm corporations, Butz responded with the instruction that farmers should “get big or get out.”

In other words, Butz proposed to remove the free market completely from the picture by interposing the government between supply and demand. When supply rose and demand fell, the government would make up the difference. By producing as much corn as possibly Butz believed that the price of food would necessarily come down. He was right of course but it is remarkable that a country based upon free market capitalism could swallow such a pill but we did.

Any sort of regulation that tends to remove an industry from the free market inevitably leads to excesses and this one was no exception. At first, the government offset the ability of larger corporate entities to drive small farmers out of business by increasing the availability of low interest farm loans. While this necessitated that small farmers go deeper and deeper into debt to maintain their competitive edge with larger producers it did allow them to remain in business for a short while. Since the main goal was maximum yield it also necessarily increased fertilizer usage and narrowed crop choices until American farmers were largely producing only two crops, corn and soy beans. This wasn’t a choice of American farmers, it was a necessity as these were the crops that were subsidized and they were the maximum yield crops that became a necessity to keep up with the debt loads.

As in all cycles where debt increases there is eventually a reckoning and this particular cycle ended with a grain embargo that the US imposed against the USSR after this country invaded Afghanistan. With falling prices and a US economy under strain as well the government began backing off of subsidies and low interest farm loans at the same time. This put the squeeze on small farmers to the point that they have largely disappeared in this country. Unable to service their debt they began defaulting in record numbers in the late 1970’s and early 1980’s. Large corporate farms began snatching up farmlands at record low prices. As they had larger cash reserves, better tax rates, and greater ability to acquire financing it didn’t take long for them to monopolize the industry. It was the “perfect storm” of economics for small farmers and a time of great profits for large corporate farm entities.

It is without doubt that these policies have decreased the real cost of food in the average American household. Most studies indicate that the percentage of a family’s income spent on food every month is now down around 10% while in post WWII years it was around 23%. This has also tended to increase the amount of food that most Americans spend on eating out every month which has accordingly seen a marked rise in the restaurant industry. American farmers now produce more food with greater efficiency than has ever been seen on this planet up to this time. Based strictly on efficiency, Butz’s ideas were a tremendous success even though he basically removed agriculture from the free market to do so. Lest anyone start polishing up the medal for Butz too quickly it is worthwhile to remember how he lost his job.

Butz had all the diplomacy of a rusty bulldozer and the temerity around reporters to match. In 1974 at a World Food Conference in Rome, Italy Butz made a remark to reporters that got him into trouble for the first time. Making fun of the Pope’s recent comments about birth control Butz commented in falsetto pidgeon Italian, “He no playa the game, he no maka the rules.” In response to widespread indignation to his comedic attempts he half heartedly apologized by stating he had not, “intended to impugn the motives or the integrity of any religious group, ethnic group, or religious leader.” This managed to save his jobs for a while but he was soon to show his lack of understanding of the effect of public statements again.

On a commercial flight to California in 1976 after the Republican National Convention Butz was entertaining former White House Counsel John Dean and Republican advocate Pat Boone with a story about intercourse between a dog and a skunk in full hearing of reporters. Boone, in an effort to change the subject, asked why the party of Lincoln seemed to be having troubles attracting black voters. Butz responded, “All the colored are looking for in life are loose shoes, tight pussy, and a warm place to shit,” in hearing of several reporters on the flight. The first defense for this remark was Butz assertion that the remark was off the record and should not have been reported. When that failed to calm the storm, he offered his resignation which President Ford seemed glad to accept before he made some other statement of equal or greater crudity.

As in most defections from free market thinking, these policies have had unforeseen results that are definitely not on the good side of the ledger. The mono-crop technology of corn has changed the agriculture of the US in all other areas as well. By holding the market price of corn to unrealistically low prices it has changed the beef, pork, and chicken industries completely. Large scale CAFO’s or Concentrated Animal Feeding Operations dominate these industries to a degree that would not have been thought possible even 20 years ago. Cattle, hogs, and chickens are fed corn and corn by-products exclusively on these CAFO’s without any vegetation needed. This necessarily decreases the need for space for these animals while simultaneously increasing the area available for corn production. Such large scale CAFO’s are terribly efficient and at the same time terribly effective at producing some nasty side effects that are currently causing problems all over the world. Cattle through millions of years of evolution evolved as grass eaters. Their whole metabolism is geared towards converting grass to meat. They were not designed as corn eaters and CAFO operators have learned that they will not survive long under such conditions without large doses of antibiotics. These antibiotics inevitably find their way into the meat and into our stomachs as consumers. Studies are currently underway linking these changes to new and potent micro-organisms that we ingest on a daily basis. The same can be said of chickens and hogs. While large corporations that run CAFO’s understand these problems and are trying to combat them their efforts are largely geared towards adding more chemical concentrations to kill these new germs.

For example, most hamburger meat bought in grocery stores today is treated with ammonia before being packaged. The ammonia necessarily removes the natural color of the meat so dyes are added after the treatment to give the meat back its natural color so the consumer is not put off by the raw pink color of the meat after the treatment. Animals raised in CAFO’s typically live in a sort of nasty squalor that is hard for most Americans to imagine. Closely confined pens knee deep in their own manure, the animals are so dirty that CAFO operators find it easier to chemically treat the meat after their slaughter than to try to establish sanitary conditions in the actual slaughter operations.

Animal husbandry is not the only industry that has changed due to corn subsidies. The very abundance of corn has led to a proliferation of chemical treatment processes whereby corn is converted into other foodstuffs, carefully packaged to be something besides corn. High fructrose corn syrup is the basic sweetener that is used in almost all mass produced products instead of sugar. It is cheaper, easier to transport, and readily available but it would not be so without the subsidies holding corn prices unrealistically low. As a matter of fact most estimates put some 75% of the products in grocery stores today as corn products that have been refined chemically in one way or another. Studies linking the nationwide epidemic of obesity to the increase of corn based sweets in the American diet are hard to ignore as well. It is without question that CAFO’s and the massive doses of antibiotics they require have also affected Americans health.

Last but not least, there are the international implications. One would think that a huge increase in our ability to produce a basic food such as corn would also result in eradication of hunger around the world. Unfortunately, this does not seem to be the case and I will give a couple of examples why.

In 1994 the United States, Mexico, and Canada instigated the North American Free Trade Agreement or NAFTA. This agreement basically removed trade barriers between the three countries with some exceptions. Interestingly, Canada instantly recognized that American corn subsidies would necessarily harm Canadian farmers and insisted upon protection in the form of tariffs on corn in the agreement. Mexico, however, had no such reservations or understanding and has suffered the consequences since.

It is estimated that some 75% of farmers in Mexico grew corn as their main crop in 1994 when NAFTA came into being. They soon found out the same thing that American independent farmers had found out 15 years earlier, they could not compete with large corporate American farms that enjoyed corn subsidies. The cheap price of American corn soon resulted in massive drops in price in Mexico which forces a large emigration of rural small farmers into industrial areas looking for work. Whatever employment gains for production industrial work that were gained in Mexico were more than offset by the loss in small farmer’s abilities to subsist. Most studies suggest this was one of the main catalysts for the recent rise in illegal immigration into this country from Mexico. The same can be said for cattle and hogs in Mexico as cheaper American animals raised on subsidized corn drove prices down to the point that Mexican farmers could no longer compete in the market.

Mexico has since started instituting corn subsidies of their own to protect the agriculture they have left but the government can’t hope to sustain these subsidies when it is constantly on the verge of bankruptcy itself. It is only a matter of time before the whole structure collapses. Most studies show that the government there is unsustainable without continued financial assistance from the US government that will have to increase steadily in the years ahead.

In the late 1990’s the US government began increasing subsidies for alternative fuel technologies in an effort to lower our dependence on foreign oil. Naturally, the huge corn lobby in this country already unimaginably wealthy and powerful garnered the largest share of this money as well. Never mind that corn is very likely the worst crop we could possibly pick to convert to fuel. Most scientists agree that corn is a net loss in the conversion rate as ethanol is extremely inefficient as a fuel and our current process of growing corn involves pouring fertilizers largely garnered from oil onto the field plowed by tractors burning oil in the form of diesel or gasoline. The long term results are largely out on the efficacy of bio-fuels of any kind but there is almost universal agreement that corn is amongst the worst candidates as a bio-fuel of any crop. Still…. there is a strong lobbyist group from corn producers in Washington so that is the path we are taking as far as bio-fuels are concerned.

While this is ridiculous enough it has managed to impact food supplies around the world. Suddenly, third world countries dependent on corn for basic sustenance find their interests in conflict and competition with corn being used as animal food and bio-fuels in the US. This has led to a marked increase in the real price of basic food commodities in many third world countries; to the point where some studies show the basic percentage of family income spent on food in these countries rising significantly.

It is interesting to suppose what Adam Smith would have thought of our “free economy” in the United States today. Undoubtedly, he would find it unrecognizable as a free economy and instantly recognize that it is basically an industrially owned and operated autocracy with decidedly monopolistic tendencies supported by an industrial hierarchy that owns and manages the government in its own best interests. He would undoubtedly be puzzled how a representative government could get to this situation but then again…. I am too.

Maybe he would understand if he could just watch “American Idol” on TV for a little while. After all, it seems to be the modern day equivalent to the hypnotist’s watch… dangling slowly back and forth, back and forth while commercials periodically interrupt to tell us how lucky we are and sell us everything from pill form mental health to instant erections that last up to four hours. Religion may be the opiate of the masses but American television is the crack cocaine of the electorate.

Wealth of nations, Chapter 1

In a continuing effort to educate myself and better understand the economic collapse we seem to be witnessing all around us I have been concentrating on economics in my studies as of late. Probably the first book on economics to gain wide acceptance as a scientific study was Adam Smith’s Enquiry into the Wealth of Nations. Smith’s book is still studied today and many believe it to be one of the cornerstones of capitalism even though it was written over a ten year period from 1766 to 1776. It was instantly widely read and acclaimed and is still studied in universities around the world today. Most conservatives even today consider it the final word on free markets and laissez faire theory.

It is a brilliant attempt at organizing and formulating economic theory from the observations Smith made about life all around him. However, to suggest that it is applicable to modern economics as anything other than a study of the beginnings of the field of scientific economic theory is to ignore reality. I will build on this theory a little more in posts coming in the future.

Book 1 Chapter 1- The division of labor

Smith’s idea, probably rather novel at the time, concerning the division of labor is one of the cornerstones of his economic system. The basic premise is that by the intelligent division of labor productivity is vastly improved. While I won’t attempt to argue with this idea it is worth noting that modern mechanized methods have turned this concept into an infinitely more powerful one than Smith ever dreamed. In his example whereby pins are manufactured he compares the productivity of one rather unskilled laborer with the productivity of ten specialized workers.

In his example the one unskilled laborer would be lucky to produce one or two pins in a day while the skilled laborers, by dividing the labor amongst wire straighteners, cutters, sharpeners for the point, men who make the heads, men who install the heads, and even those who package and sort the pins the production is vastly improved. In Smith’s example a group of ten such men could make about twelve pounds of pins in a day. This twelve pounds would equate to around 48,000 pins in a day. If this productivity is divided by the ten workers who produced it some 4,800 pins per worker per day are produced. Smith compares this with the 1-20 that an unskilled worker working alone might possibly produce.

All of this is very well taken and tends to support his ideas about labor being the real basis for the cost of products. In other words, according to Smith’s reasoning since the division of labor equals greater productivity then it tends lower the real cost of goods. This is a reasonable assertion, even an ingenious one in Smith’s day considering he spells out this common sense calculation in terms easily understood and clearly defined. One of the other basic tenets of Smith’s economic theory is that the market tends to balance wages and reward aquired skills, either directly to the worker or indirectly to the employer who hires and trains the worker.

We can hardly blame Smith for failing to predict or understand the mechanization of production that would come about in the next two centuries. However, let’s take Smith’s analogy of the pins and move it forward to this century. In the early 80’s I worked in a factory that produced straight pins and sewing notions of all kinds. I worked on a line that produced straight pins. Each machine made different types of pins from wire so I will have to generalize but on average each machine ran some 100 pounds of pins in an eight hour shift. There was one operator/jobsetter that maintained and repaired the machines for each row of machines. Each row of machines contained 14-16 pin making machines so this conservatively equates to some 1400 pounds of pins produced by one man’s labor in an eight hour shift. Since the plant itself ran three shifts this equates to 4200 pounds of pins in one day split amongst three workers, or 1400 pounds of pins per worker. If we use Smith’s numbers of 4000 pins per pound we come to some 5,600,000 pins per worker. This is a 1166% improvement in pin production per worker.

What is the net result of this massive increase in productivity? Beyond the drop in relative “dearness” as Smith would put it of pins, the theory that labor is the true basis for real costs is clearly debunked and outdated. Smith had no way of knowing that such massive increases in productivity would be possible, much less begin to understand what they would do to his theories about the value of labor but it is clear that labor is no longer the true source of value in costs; the mathematical realities of mechanized production have forever changed this ratio. I would further surmise that robotics, PLC controls, and computerized production systems have probably increased this ratio even more dramatically; to the point that one man’s maintenance for automated pin producing machines probably has increased this ratio by another factor of ten since the 80’s. Today we are probably looking at a 10,000% increase in productivity per worker in manufacturing pins since Smith’s day.

The basic premise of this chapter in Smith’s book is aligned towards showing that each improvement in production filters down to the bottom layers of society. His argument that the lowliest laborers in industrialized nations of his day lived opulently compared with the kings of savage lands might have been feasible in Smith’s day but in our times it seems to fall somewhat short of his predictions of trickle down opulence. Can anyone actually suggest that this 10,000% increase in productivity of pins has trickled down to the people who actually make the pins? Are people who do the maintenance on today’s modern manufacturing equipment 10,000 times better of financially than they were in Smith’s day? Obviously, a 10,000% increase in productivity has to benefit someone, so I wonder who this particular one has benefited. Maybe some of our modern CEO’s could take a stab at answering this one…..

The AMA and its part in the debate, part 1

One of the players in the current health care debate and in every other health care debate in the history of this country is the American Medical Association. In 1847 the AMA was set up by Dr. Nathan Davis of New York. Dr. Davis’ idea was to set up a governing body to improve and standardize medical training which was both rudimentary and inconsistent at the time. In the interest of improving this training Dr. Davis formed the AMA and by the early 1900’s it was the recognized authority on medical practices and training for physicians. By 1899 the AMA set up the Committee on National Legislation, one of the first lobbying groups in Washington, and began to work to influence all government legislation having to do with healthcare. By this time the AMA was also the accrediting organization for medical schools, hospitals, and all manner of health care services and therefore was a force to be reckoned with as a political entity from this point on.

Health care in the United States has a long history of being a private concern between the physician and his patient and the AMA has been an assertive protector of this type of system from its inception. As an organization originally set up to improve health care by controlling and standardizing training practices and circulating educational information to both doctors and the general public the AMA has also evolved into a powerful political organization that first and foremost protects the interests of its member physicians. If there is any doubt about where the interests of the AMA lie, one has only to look at the history of its actions to understand the reality of the situation.

The AMA has been an outspoken and vigorous opponent of health care insurance since the very first plans were formulated in the early twenties. Two things drive this opposition according to the AMA. First, there is the fear that insurance will interfere with the patient-physician relationship which the AMA holds sacrosanct. Second, there is the fear that physicians will lose the ability to charge fees on an individual basis. Physicians, with the AMA’s approval, have long charged different rates for different patients based upon the individual’s ability to pay for such services. Group health care insurance plans have tended to set costs across the board and have the added effect of forcing physicians to compete with each other on a cost basis much like every other industry in a free market society. The AMA has opposed all such setting of costs from the very beginning. One may accurately surmise which of these two problems that the AMA is more concerned with by the actions they have taken to defend them.

As a professional organization open only to members of the industry it is hard to argue against the supposition that the AMA is a guild. The AMA in effect is a union of doctors which has repeatedly shown its first interest is the protection of its member’s financial interests. As I discussed in an earlier post about the health care plans, the Blue Shield plans were formed largely in response to Blue Cross plans that the AMA perceived as threats to its members ability to price discriminate. In 1934 the AMA adopted a set of ten principals that were to be the guiding factors in physician’s health care plans. One of the prime considerations of these principles was that physicians would be in charge of all such voluntary plans and that the AMA would retain control of such plans in the future. The overwhelming consideration in these efforts was an attempt to retain control of pricing for medical services which the AMA has consistently insisted should not be subverted by competition or “socialist” government and private based plans that would set prices by controlling where patients would receive services and seeking out the best prices accordingly. The AMA has used this term repeatedly in every campaign they have launched throughout the last century to retain price controls in the hands of physicians. As we shall see, it is a consistent theme adopted by what is inarguably a union of doctors in order to protect them from competition. It is a little ironic that they should be allowed to use a term that is such an anathema to free markets to protect themselves from the competition that is the core principle of free markets without being called to answer for it but history has shown that this is a recurring process.

The first efforts at organizing a national health care policy occurred in the early 1930’s and were soon an integral part of the New Deal policies of the Roosevelt administration. In June of 1934 Roosevelt formed the Committee on Economic Security to study problems relating to the economic security of individuals and report back on their findings by December of that year. The committee was charged with studying all manner of insurance policies and their possible impact upon the financial health of individuals in the United States. The country was still in the throes of the worst economic depression that had at that time been visited upon this country and people wanted to find ways to keep such a collapse from happening again in the future.

Most of the members of this committee were convinced that rising health care costs and the obvious inability of most consumers to withstand the financial costs of any sort of long term health problem were a danger to almost every US citizen. Several members of this committee had extended experience with the American Red Cross which was inundated with health care requests from the lowest tier of society in the country at the time and were convinced that the only course available to take care of such problems was a form of governmental health care. There was no argument on the committee that a form of government health care was not needed to provide care for Americans who could not otherwise afford it but there was concern that there were other more pressing economic issues that should be dealt with first; such as unemployment insurance and crop insurance for failing farms. Several of the committee members also argued forcibly that the AMA would fight any governmental health care program with all the means at its disposal, which were considerable.

As it turns out, they were exactly right. The AMA immediately spearheaded a national campaign against government involvement in any sort of nationalized health care plan as the first step in a “socialist” movement dangerous to US national interest. Roosevelt was besieged by requests from the AMA to appoint organization members to any board that would consider health care reforms and widespread campaigns financed by the AMA began railing against the takeover of health care by a “socialist” agenda aimed at the collapse of the free enterprise system itself. If this sounds familiar, it is much the same logic that is being used today to lambast the supporters any sort of government involvement in health care issues. Precisely because the AMA was so opposed to any such reform in 1935 the administration dropped its push for health care reform even though every study done at the time pointed out that it was the only possible way to take care of large scale health care problems at the time.

Since there was no organized support against the AMA’s views health care reform was tabled in favor of other reforms that did have organized lobbies. The AMA’s concern was that government health care would effectively set prices for their member’s services. It would in essence force doctors to compete with each other for government care contracts. While competition is the very nature of free enterprise it is an anathema to the AMA and always has been. This is fairly simple to understand if we remember that the AMA is a union of doctors organized for the interests and in the protection of doctors. Any system that forces doctors into a free market system wherein they have to compete like every other industry for customers is bad news to the AMA.

In 1936 a report was released by the National Health Care survey, a group formed by the federal government to study health care issues. It was the first comprehensive report on the state of medical care in the United States ever published. The results of this study were comprehensive and far reaching. The survey’s findings were significant. According to the survey the rich get sick much less often than the poor. These numbers were further broken down by dividing acute illness and chronic illness. The poor were 47% more likely to get an acute illness and 87% more likely to get a chronic illness. The poor also were shown to stay sick longer than the rich, 63% longer for those on public relief programs. There was a definitive division between those on relief programs and those who were not as far as if they received medical treatment at all for illnesses of a week or longer with 30% of those on relief receiving no care at all for such problems. Upper income families were shown to avail themselves of 46% more doctor’s visits per illness. Some of the darker findings of the survey reported that annual mortality rates in the US were higher than any other civilized country in the world and that infant mortality rates were higher than in any other industrialized nation at the time. The final part of the report stated that a large proportion of the population had no financial cushion to pay for the rising costs of health care.

While none of this information was surprising, it was enough of an impetus to push Congress into an effort at rectifying the problem which eventually resulted in the introduction of the Wagner Bill in Congress on February 28, 1939. The Wagner Bill touched off widespread debate and committee hearings in Congress but was immediately targeted as a “socialist” agenda by the AMA. The AMA formed the “National Physicians’ Committee for the Extension of Medical Services” to combat the bill. It seems that this committee for the extension of medical services actually was a lobbyist group with the express purpose of defeating the Wagner bill while offering little or nothing in the furtherance of actual services but this is a closely followed pattern that the AMA has historically used to protect its interests. The Wagner Bill lost impetus with the coming of WWII and a shift in government’s interests but the AMA’s committee offered exactly zero solutions to the problem; it simply faded away into obscurity when the bill which it was formed in opposition to died.

As WWII started to wind down and the country’s focus shifted from the international scene back to internal policies the health care debate began again. The Social Security Board who had been deeply immersed in home-front mobilization efforts during the war had also not been entirely free from health care concerns during this same period. By 1942 reports from this board began expressing the view that health care reform was needed and later that same year Congress organized Emergency Health Care Services for the lower four grades of dependents of American servicemen. The EMIC (Emergency Maternity and Infancy Care) was seen by many as a stopgap measure needed for the inevitable implementation of a national health care system for citizens unable to pay for modern medical care and most people believed it was the first step in this process.

By 1943 as the tide of war began to shift the US government was swept with enthusiasm for wholesale governmental social welfare programs such as those being espoused by our allied partners in the war. The Beveridge Report formulated by a British committee formulated for advancing new social welfare programs received widespread support and acclaim in the US at the time and talk began anew of a new national health care plan that would make medical care a reality for all in the United States.

On the heels of this reports circulation in the United States the Wagner-Murray-Dingell bill was presented in Congress in June of 1943. Mobilization of lobbying groups against this bill was quick with the well organized AMA taking the lead with its National Physicians' Committee for the Extension of Medical Service at the head.

It was joined in this fight by a revitalized Insurance Economics Society of America group that was actually a consortium of private insurance concerns who were beginning to be powerful players as the spread of private insurance usage subsidized by state legislatures had become a booming business by then. The Pharmaceutical Manufacturers' Association which was something of a union of drug manufacturers also joined in efforts at defeating this bill as it too was afraid of open competition in the market and was notoriously alarmed at the prospect of the government setting prices on drugs as a part of a national health care effort.

In the face of such organized opposition the bill died in committee. At the time, the Roosevelt administration was lukewarm on a national health care policy so it was another case of an organized lobbying effort succeeding due to the lack of an opposing organized force. It is worth noting here that the overriding concern of each of the opposition forces against the bill was financial. The AMA has always protected profit of its members over and above any other principle and the other two groups in this effort had profit margins as their only concern in this issue as well. While most experts and virtually all reports agreed that health care reform was necessary, the sticking point was as to who would control the reforms and the AMA and its allies have consistently insisted upon control of pricing as the first principle in their opposition to all such government reforms.

By 1944 Roosevelt’s view of the situation had begun to change. In election campaigning in that year he began to move toward an endorsement of nationalized health care. He urged an Economic Bill of Rights under which "the right to adequate medical care and the opportunity to achieve and enjoy good health" and "the right to adequate protection from the economic fears of old age, sickness, accident, and unemployment” would all be sheltered by Social Security. Following his re-election in that year and after the end of the war in 1945 he proposed a personal sponsorship of such a plan in a budget message of January of that year. He reiterated these views in his 1945 state of the union address and promised to get back to Congress on these issues in the near future. Unfortunately, Roosevelt died in office before these proposals came out. His successor, Harry Truman, promised to push for these same reforms and the opposition began to line up against him.

The next three years were full of acrimonious debate in Congress and across the nation on the issue as opponents of health care reform lined up to fight government involvement. The AMA declared all out war on the premise of government healthcare. After Truman was unexpectedly re-elected in 1948 the AMA’s House of Delegates met to in December and voted to charge each of its members an additional $25 to avoid “enslavement of the medical profession”. A prominent public relations firm was hired to spearhead the advertising campaign and some 4.5 million dollars was appropriated by the AMA to fight the passage of any bill having to do with government involvement in the health care system. A highly organized propaganda campaign was organized in specific reaction to the new administration sponsored Wagner-Murray-Dingle bill which organized mass media, vast speechmaking efforts, and congressional lobbying against the bill.

While public opinion polls had in 1948 shown 70-79% approval for government reform of the health care bill, the public campaign by the AMA and its allies began to have an effect. The gist of the campaign focused on three issues. First, the AMA and its supporters suggested that the US at the time enjoyed the highest standards of medical care the world had ever known at the time. While this was not true according to health organization reports, it was trumpeted loud enough and long enough that people began to believe it. Medical standards in this country and everywhere else in the world with pure capitalist systems have always been based upon the care that individuals could afford and under the American system most of the country could not afford the best care so the averages for American health care standards necessarily suffered in comparison to many European countries where nationalized health care had already seen widespread usage. While the AMA’s publicity program admitted that there were deficiencies in the system it insisted that these were greatly exaggerated in the face of directly opposing information from the National Health Surveys conducted at the time.

Second, the AMA and its allies claimed the National Health Insurance would lead to federal control of all medical care, which would undermine the system of free enterprise that the system was based upon. This is a claim that is universally made even today in such discussions even though the AMA and the medical profession in this country has been completely isolated from the free enterprise system since the inception of the AMA in a flagrant and self-serving manner that has been pointed out in numerous instances in this post. Every political action that the AMA has sponsored has been aimed at the elimination of competition which is by any understanding of the term one of the basic tenants of the free market system. For the AMA to claim that government intervention in health care would undermine the free market there would have to be a free market to start with and this is categorically not the case in our current medical system or in the one that existed in 1948.

Third, the AMA and its allies suggested that government intervention would necessarily drive the cost of health care up; probably beyond the ability of American citizens to pay for it. As an adjunct to this argument the AMA began pushing for the spread of private health care insurance programs provided of course that doctors maintained control over all billing practices so that they could continue to set rates without being faced with competition. One can argue that private enterprise and the free market are the best controls for cost but not if the free market is eliminated from the field; which is exactly what the AMA and private insurers in collusion have managed to do in this country since the turn of the century. Judging from the runaway costs that this collusion have fostered in the industry in the ensuing 60 years it is hard to make this argument intelligently today but it is still being made in much the same manner as if we haven’t already seen health care costs explode in such a manner that no one can afford health care without insurance.

If any or all of these arguments sound familiar that is because they are still being used today in our current debate about health care. Very little has changed on this front besides the undeniable fact that health care is now impossible to afford without insurance. Still, the argument in the late forties was swung even further to the side of those against National Health Care by the great bogeyman of free enterprise; socialism and its more fearsome cousin communism. As the battle lines began being drawn in the debate organized labor and social security administration stalwarts joined the issue on the side of governmental health care for the public.

In the face of these reactions other issues began to color the debate against these organizations. The Alger-Hiss trials began and exposure to communist threats within branches of the US government and organized labor began to lead to suspicions of motives. China fell to the communists soon afterwards and Russia exploded an atom bomb of their own as the lines between Eastern Europe and the US began to be drawn ever more definitively. The charge of socialist tendencies took on more sinister overtones in the face of these developments and the AMA and its supporters used fears on this front to drive their point home more forcefully. The McCarthy hearings hysteria began to gather public notice and dominate the news and it was relatively easy to use these fears to squash the efforts to nationalize health care. By 1952 it was evident that Truman had lost his battle to nationalize health care and the AMA had won.

Health Care, Part 1

Health Care seems to be the main focus of most of our news media for the last little while. While I don’t claim to know all the answers to dealing what are obviously dangerously skyrocketing costs I think it is easy to see that we must do something to get costs under control or Health Care will simply devour what is left of our economy. Add to that the largely unmentioned fact that a greater percentage of our population will be senior citizens in the near future than we have ever known and it is easy to see a confluence of events that are potentially economically devastating.

I find it ironic that what is realistically one of the leading causes of spiraling health care costs is almost always bandied about as if its wider usage will solve the problem. The problem is not the lack of insurance for people who can’t afford it; the problem is that people cannot afford health care without insurance. It is not coincidental that the people who have fostered and profited wildly from this system where insurance in indispensable have also managed to put themselves in a position to further their profits no matter which direction the current debate takes. This should come as no surprise to people who are actually paying attention; it is the methodology that corporate America has used for the last 30 years to guarantee that profits are sacrosanct and the public pays the bill for losses.

Why are health care costs so high? This is actually the only question that we need to consider in order to come to a real solution to the problem; anything else is treating the symptoms without addressing the cause and most any doctor worth his PHD will tell you that is a futile pursuit. There are no simple answers to the problem and there is no silver bullet solution but it is time to start sorting things in a reasonable manner. If you want to find the root causes of anything you must first sort them by some criteria. In this case, let’s sort things by the simplest method; are they contributors to the rising costs or are they part of a solution to lower costs? In a very broad and general way there are many things that will be hard to sort using this methodology but there are some that are glaringly easy so I think we should start with those.

Insurance….. Is it a contributor or a solution? In order to understand Health Insurance and its contribution to the problem we are facing today it is necessary to look at the history of health care in this country. Up until the 1920’s in the United States health insurance was an unknown and unneeded commodity. Health care costs were low comparatively speaking with most families expending less than 7% of their annual income on health care. Insurance companies were also not interested in the idea because they could see no way of guaranteeing its profitability. According to one of the major insurance publications at the time, “"the opportunities for fraud [in health insurance] upset all statistical calculations.... Health and sickness are vague terms open to endless construction. Death is clearly defined, but to say what shall constitute such loss of health as will justify insurance compensation is no easy task". As it turns out, these concerns were largely correct and have been the bane of every attempt at equitable insurance since that time.


Interestingly, several modern European nations at the time were starting down the path of nationalized health care but in the United States there were three major stumbling blocks to such an innovation. The first was the simple fact that since health care costs at the time were not prohibitive there was essentially no push to invest in such a program. Second, doctors who were already organized in the AMA were very much against any sort of organized system which might limit costs or cut into their profits. Third, there were the burgeoning drug companies who were also afraid of regulations which might cut into their profits. Interestingly, these 3 groups have been at the forefront of every battle to fight health care changes since that time and still are today for much the same reason. The AMA, the large drug companies, and the insurance companies contribute huge sums of money to lobbying efforts aimed at keeping costs high and profits at a maximum even today when the costs of health care have skyrocketed to the point that it is a national crisis. Anyone who suggests that any of these groups is not engaged in such practices need only look at the facts of the past ninety years but I will get back to that in a minute.

The first health care plans were actually Hospital Plans. Under these plans a set fee was paid in advance to cover a set number of days in the hospital. These plans were mutually beneficial for consumers and hospitals as it held cost down for the consumer and gave hospitals a fund for operating from that helped smooth over the inconsistencies involved in maintaining a facility that was not full all the time. Hospitals were originally set up, often with state funding help, as a source of emergency care and surgical in- patient facilities. In times of epidemic hospitals had to offer enough beds for emergencies but were usually only 65-70% full. This led to inevitable cycles of profitability followed by loss of profits and the hospital care plans helped to smooth out these cycles by giving the hospitals reliable and predictable sources of income. The consumer gained because it kept him from suffering catastrophic loss of income that could come with an unexpected long hospital stay, thus the first health care programs were actually hospital plans instead of health care plans. By providing hospital care at an individual hospital the plans soon caused hospitals to come into competition for these plans and accordingly drove the hospital costs down across the board with this competition. In response to this pressure, community hospitals began to organize to offer Hospital Insurance and eliminate the need for competition.

The first Blue Cross plans in the 1930’s were actually organized by the American Hospital Association (AHA) as a means to relieve the pressures of competition and to control prices. Inserting clauses into such plans that guaranteed patients could choose their own hospitals regardless of costs allowed the price of Hospital care to again start to rise where the competition amongst such hospitals before these plans had been steadily driving them down. Then, as now, insurance plans became the middle man that removed the customer from the loop of supply and demand that drives free markets. When the customer didn’t get charged for price differences directly he lost interest in trying to find the lowest price. This has been the secret to exploding health care costs since that time. As long as the Blue Cross plans also received the help and support of legislation at the state level which allowed them to set up such companies as non-profit organizations free from paying taxes they were also exempted from existing insurance regulations that would require them to meet financial reserve and fiscal solvency laws already in existence for all other insurances. The Insurance writers well understood the problems associated with health insurance noted above that had kept them out of the business to begin with and were only drawn into the business by such sheltering legislation by state governments who considered it a public good. This is worth repeating again; Blue Cross originally became a hospital insurance success only because the state governments gave them tax exemptions as well as legal exemptions above and beyond those afforded all other types of insurance operating in the private sector. The states reasoned that the Hospitals themselves were underwriting Blue Cross by agreeing to provide the services in case of any failures on the part of Blue Cross to pay. The state governments had from the beginning subsidized payments for public hospitals by shouldering costs for the indigent care of those who couldn’t afford to pay so it wasn’t that big of a leap for the state governments who were now on the hook only if the Blue Cross Hospital plans collapsed financially.

The American Medical Association was against health insurance from the very beginning. They felt it would take away their rights to set prices and would eventually standardize pricing for medical procedures. This was anathema to physicians who were used to setting priced based upon what individuals could afford to pay them. Price discriminatory practices had been the norm since medical science came to be more well accepted in the late 1920’s and the AMA was determined to protect these practices above all else. However, when Blue Cross plans began to become widespread enough to affect physicians profit margins, they reacted by forming physician care plans of their own. Blue Shield was formed after the AMA set rules guaranteeing the control of physician’s care insurance by the physicians themselves. This would protect their ability to set prices and still give them the ability to compete with Hospital Care plans. By the late 1930’s the AMA and local physicians were lobbying state governments to set up tax exempt companies on the model of the Blue Cross plans. These plans soon came under the control of Blue Shield and were set up as non-profit companies who were tax exempt and also exempt from the same fiscal responsibilities as the earlier Blue Cross plans. State legislatures were anxious to help their constituents deal with rising health care costs. It is worth noting here that both Blue Cross and Blue Shield that were state supported were originally set up in direct opposition to free market competition. As a matter of fact, both were formed and installed specifically in response to free market competition which was in fact driving health care costs down before their formation. Blue Shield plans allowed doctors to charge whatever fees they determined to charge on top of what the Blue Shield plan paid the doctor. This was the driving force behind the AMA’s proposals for the plan to the state to begin with; it allowed doctors to continue to price discriminate based upon individuals ability to pay and avoided set fee schedules that would take this control from the physicians and thereby lower their profit margins.

As medical science continued to improve and health care possibilities expanded the costs associated with health care continued to rise. Blue Cross and Blue Shield’s successes in the market along with the fact that they were steadily driving costs up by eliminating free market principles from health care tempted private companies to become involved in the process as well. Private Insurers had long looked up on Health Care as a dangerous business but by carefully controlling who they enrolled in their programs to begin with it was possible to make the business lucrative enough to overcome their reticence. Worker plans seemed to be the ideal model for profitability as by enrolling only active workers the insurance companies could make sure that most of their customers were healthy enough so as not to be risks for long term expensive medical care. Most employees were young and healthy enough so as not to impose adverse risks and were in fact a new market for health care insurance for the simple reason that most of them would not have been seeking health care insurance to begin with if it weren’t offered through their employer. It was the base that was needed to start the giant pyramid that is actually the core principle behind insurance to begin with. There must be a larger base of paying customers not using health care insurance to pay for the smaller tier on top who actually have need of health care. Private insurers have the added advantage of being able to screen and reject potentially adverse customers based upon pre-existing conditions which the state supported plans are not able to bar from coverage.

As more and more people began utilizing health care insurance and therefore removing the system from the laws of supply and demand that drive all free market systems, costs inevitably began to spiral. Private insurers began to leverage their way into the market because they had another advantage over state supported plans such as Blue Cross and Blue Shield. Private insurers could offer rates based upon the relative risk associated with groups of workers. In other words, while state supported plans offered one rate for an area that included all customers, private insurers could offer lower rates for lower risk, healthier customers and higher rates for those considered to be higher risks due to age, physical condition, and hereditary factors. By the early 1950’s private insurers had a larger share of the market than state supported plans but both groups were beginning to pare back services for high risk patients.

Lest anyone think that private insurance companies operated in a free market system beyond that of the state supported plans, it is worth noting that government early on began to subsidize these plans as well. During the war years of the 1940’s the federal government passed several acts attempting to hold wages in check. Health insurance plans were exempt from these acts and companies began utilizing such plans to keep workers on staff and to lure them from competitors. This was followed in the fifties and sixties with federal exemptions from income taxes for employers who paid money into their employee’s health insurance plans and for monies that employees themselves began to pay into such accounts as well. The federal government, by the judicious use of tax exemptions, encouraged health care insurers to gain an even firmer control of the market. At the same time, Insurers with the help and complicity of the AMA and AHA, helped drive costs up by removing any semblance of competition in the market. This was done in full view of the customers themselves who noted exorbitant cost jobbing on the part of the medical industry but didn’t complain because it wasn’t coming out of their pocket. The only problem was that it did come out of their pocket indirectly through higher premiums which translated into lower take home wages. Still, as long as the economy was booming and wages were increasing the rising standard of living could absorb the costs.

By the mid seventies some 75% of the people in the United States had some sort of health care plan, whether it be government sponsored Medicare or Medicaid, state supported Blue Cross and Blue Shield, or private insurance company plans. As health care costs have skyrocketed it has become an absolute necessity for families to have some sort of health care coverage. One serious accident, one prolonged stay in the hospital, or one serious illness is financially catastrophic in this day and age. Medical bills are by far the largest cause of bankruptcy in this country today. A 2005 study by Harvard University showed that over half of all bankruptcies filed in 2001 were directly caused by medical costs that the victims could not pay but this is not the end of that story. Over 75% of the victims in the study had health insurance of some kind at the start of the illness or hospital treatment that led to the high medical costs but lost it as some point during the ensuing medical procedures. Many were unable to work and could not afford to keep their medical insurance and others were simply denied coverage for pre-existing conditions. The last thing someone with cancer can afford is a lawyer to fight an insurance company who drops their coverage and insurance companies are well aware of this fact.

Since its inception in this country health insurance has been one of the leading causes of rising health cost. By removing the laws of supply and demand from the medical industry it has fostered an explosion in costs that we simply cannot afford anymore. As I have noted so far, all the major advances in Health Coverage have been precipitated by the desire to eliminate competition from the field. The AMA, the AHA, and private insurers have contributed to this unnatural growth in costs for one simple reason; to increase profits. The only way to make Health Insurance a practical necessity is to make health care costs high enough that you cannot afford to be without it and with the support and collusion of the medical community insurance carriers have succeeded admiringly in doing just that.

The abbreviated history of Health Care Insurance above points out one thing with absolute certainty; insurance is more of a cause of the present problem than a solution. In every instance it has worked against the free market system that controls prices in every other aspect of our society and it will continue to do so for the simple reason that it is obscenely profitable to do so. The idea that we need more insurance of any kind to control health care costs is in direct opposition to the facts. We need to control the cost of health care by placing health care costs back in the free market which is directly opposed to what Health Care Insurance has historically done. We cannot expect the people who have fostered such a profitable business by removing the laws of supply and demand from the system to be the leaders in reducing costs, nor can we expect the AMA who has at every instance worked against competition in the medical industry to lead the way.

In my next post I will discuss the AMA’s collusion in the current mess more fully as well as the further introduction of Medicare and Medicaid which have been band-aid measures when what we actually need is a complete overhaul of the system and a return to what it has not been since the 1910’s; a free market system.

Home Schooling

On September 11, 2001 religious fanatics of a backwards sect of Islam crashed four jetliners in an attempt to strike a blow for their God in the name of everything they considered holy. Some 3000 people died that day in the United States due to the action of 19 hijackers with a misguided and narrow view of religious duty. We tend to lessen the impact of the religious part of this equation in this country because we as a people don’t want to face up to the fact that it was a religious act to the 19 men who carried it out.

Most American’s ideas of religion have little to do with war or terror but history tells us that this is a willing misunderstanding of the true nature of organized religion. Throughout recorded history human beings have been slaughtering each other over religious ideas. This is an undeniable side effect of all organized religion. The Islamic fundamentalist holds neither a monopoly nor even a patent on religious terrorism. The seeds of religious terrorism go as far back as the beginnings of Judaism and have been an undeniable and indispensible tool of the leaders of organized religion since the very beginning of all three major western faiths, Judaism, Christianity, and Islam.

The power that goes along with leadership in organized religions has been shown again and again throughout our history to be corruptive and violent in extreme. In a country that prides itself on its humanitarianism and undeniably is a leader in this area of human endeavor, the US is also home to a large and seemingly growing base of religious fanatics determined to carry out a holy war against the infidels. Infidels in this case are defined as anyone who doesn’t agree with religious orthodoxy; the correct orthodoxy in their view but an untrammeled and ill conceived orthodoxy that is actually little more than ancient tribal hatred carried through 3 thousand years of power consolidation.

In this country we seem to be massively confused by common terms that are used as bulwarks against the spread of knowledge that could ameliorate these hatreds. We have an idea of religious tolerance that closely matches the “don’t ask, don’t tell” silliness that today is the official policy for gays in the military. If you wonder where such a silly idea could come from it is burned into our psyche from our confusion about what religious tolerance means. Tolerance is defined as:

"a fair, objective, and permissive attitude toward those whose opinions, practices, race, religion, nationality, etc., differ from one's own; freedom from bigotry"

Fair, objective and free from bigotry is one thing; it is not synonymous with blissfully ignorant or willingly confused. There is a quote from Thomas Jefferson that is often bandied about in support of our current understanding of religious tolerance:

“But it does me no injury for my neighbor to say there are twenty gods, or no god. It neither picks my pocket nor breaks my leg”.

Unfortunately, this is the second of two sentences in his famous “Notes on Virginia”. The first sentence comes more to the point of our current problems:

“The legitimate powers of government extend to such acts only as are injurious to others”.

Jefferson, one of our earliest and most ardent supporters of religious freedom, understood that there is in this freedom, as in all others, a dividing line between our individual freedoms and those of our fellow man. This point is the dividing line between liberty and tyranny, the point where your rights begin to infringe upon my own. While it is inherently necessary for us to give everyone a right to their own opinion it is also undoubtedly necessary for us to know where the line between opinion and danger to others exists. If your religious opinions include the idea that you are duty bound to kill others who don’t believe as you do we have crossed that line. I would further submit if your religious opinions include the idea that an apocalyptic bloodbath is inevitable in our future and that everyone must either ascribe to your views or be in league with the devil then we have also crossed that line. Ideas influence action. We cannot realistically separate our actions from our beliefs so it is imperative that we should re-examine our beliefs.

In my opinion we have obliterated that line with our current understanding of the term religious tolerance. We don’t ask the questions that point out the ludicrous nature of belief systems out of some misguided notion that it would be intolerant to do so. We don’t bring the dank ignorance of fundamentalist religion out into the light of logic because of this same misunderstanding of terms. The fundamentalist Islamic, the fundamentalist Christian, and the fundamentalist Jew hold ideas that are illogical, unreasonable, and dangerous to those of us who believe reason and discourse to be the guides to understanding but we don’t bring these ideas out into the open because we misunderstand the term tolerance. Tolerance doesn’t mean we shouldn’t discuss such things, it means we should give all ideas the same consideration and equal weight in discovering their veracity or lack thereof.

We don’t accept cold fusion because no one has been able to prove it but we routinely accept such silliness as virgin births, resurrection, and turning water into wine because it is written in some ancient tribal manuscript thousands of years ago by people who were neither there to witness it nor a part of that generation. Not only do we accept such lunacy, we use it as a root basis for our world view.

Can anyone deny that the US attachment to Israel is based on the ideas promulgated in the Bible? Seriously; a chosen people who have the right to displace another ancient tribe because an ancient set of books written by the founders of this tribe says it will be so?

How do we, as reasonable human beings possibly combat ideas that purport to come directly from an all knowing being?

Any argument that devolves into the hysteria of ancient manuscripts from violent wandering tribes or the unquestioned belief that an all knowing being commanded a chosen few is an argument for infantile children, yet we seem to accept it as an end to discussion when carried out in public in this country every single day. Ignorance can thrive only in the absence of knowledge. Organized religions have known this for centuries, which is exactly why Copernicus correct theories were ostracized and Galileo himself spent the latter years of his life under house arrest. Organized religion has always been against the spread of knowledge for the simple reason that many of its most basic tenets rest upon the ignorant utterances of its founders. Remove these props and the whole theory collapses; hence the leaders of organized religion’s historical fear of knowledge.

While it was undoubtedly retardant to the spread of scientific knowledge, the persecutions of the Christian Church against Galileo and Copernicus’ theories pale in comparison to the dangers presented by the Pandora ’s Box of fundamentalist violence that we see in the world all around us today. The Middle East is a powder keg of war and violence between Jews, Islamics, and Christians that is starting to spill over into Europe. Africa is much the same way yet we persist in ignoring the incontrovertible fact that organized religion is at the root of many of these conflicts.

We find the ideas of Islam that call for violence against the non-believers to be anathema yet we ignore the fact that Christianity and Judaism are rooted in the same ideas. Christianity itself is steeped in the idea that an unavoidable apocalyptic all consuming war is the future of mankind. While modern day Christians may preach tolerance and respect for all religions they hold at heart the idea that all must one day join with them or with the forces of evil. There is no real tolerance in these ideas, only a mild forbearance of the perceived ignorance of those not yet converted or indoctrinated in the faith. The very idea that one all knowing being revealed the truth to one set of people in one set of books is the antithesis of tolerance; rather it is the source of all intolerance. After all, if you truly have the belief that all mighty God has spoken it becomes sacrilege for man to question with his power of reason.

The only true solution to many of the problems in the world today requires that we as a people drop some of these ancient tribal superstitions and begin dealing with each other as human beings. Since most of these ideas are passed from generation to generation through the family it is imperative that we find ways to discuss them, to hold them up to the public light of reason. Every time we turn away in silence and bite our tongue in some misbegotten idea of tolerance, we allow ignorance to spread. Every time we avoid the subject when we are proselytized by the faithful we follow this same path. Conversation, reason, and understanding can only conquer ignorance if we attend to it by practicing their usage.

All of this leads to the reasons for this post. Recently, I read an article about home schooling. While most everyone agrees that public education in this country is at the nadir of effectiveness I am not sure we understand the consequences of mass home schooling or the reality as to why many groups are advocating it.

Unfortunately, home schooling in many cases has become synonymous with religious indoctrination. Without even going into the fact that it does little or nothing to prepare children for dealing with their peers, some of the curriculum being taught is narrow at best and flat out erroneous in many cases. We are all familiar with efforts to indoctrinate “intelligent design” into our public classrooms as some sort of pseudo-scientific alternative to evolution and I was not at all surprised to find that this is one of the basic tenets of many such programs but I was a little surprised at some of the other things that are being taught as factual.

“Under God” is one such textbook being advertised as an entry level study of government. The title gives this one away, but here is an excerpt describing its content:

“The purpose of this essential book is best set forth in the preface: “The goal of 'Under God' is to develop effective citizens within the framework of the Christian faith and Christian principles. To help students attain this goal, 'Under God' includes sound ideas about the foundations of constitutional government and the historical background of United States government. The starting point in teaching government is the basic conviction that God ordains it. He is the source of authority. That concept is the root of good government. The fear of the Lord is not only the basis, but also the motivation for good citizenship."

The starting point in teaching about United States government is the basic conviction that God ordains it? The fear of the Lord is not only the basis, but also the motivation for good citizenship? Of course what is not said but certainly implied here is that the Godless cannot possibly be good citizens under the United States government. This is about as far from the guiding principles put forth in our Constitution as one can possibly get. It is in fact advocating an all knowing dictator, the fear of whom is the true basis and motivation for good government. It is mind boggling that we could accept this as teaching literature from which to learn about US Government and I find it a little scary to think that this is how even a small part of the present generation is being taught. The book is further recommended with the following passage:

“Under God is recommended as a textbook for an 8th or 9th grade course in U.S. government. Its structure and presentation, however, make it a valuable text for high school students and adults who do not have a thorough understanding of our government and its roots. Originally published in 1966 by The National Union of Christian Schools (now Christian Schools International), "Under God" was periodically revised through 1990. We have been very pleased to take over this project and, under the direction of Mr. Hendricks, make the necessary revisions to keep this book current.”

I can agree that it would not be suitable for high school students and adults who do have a thorough understanding of our government and its roots because such people would recognize it as being diametrically opposed to the true basis of our government. Beyond that, it is unvarnished religious propaganda and would be instantly recognized as such in any open presentation of its views but that is kind of the whole point of this post. It is not being presented in an open environment where opposing viewpoints are available; it is being indoctrinated into children who don’t know any better. To add to that folly it is being done in most cases by the one person who the child trusts the most; their parent.

In the history section of the same website I found the following note in bold print at the start:

“History has not only been planned by God, but proceeds according to His purpose. For this reason all history - ancient, medieval, and modern - must be viewed as the sovereign rule of God over the affairs of men. It is more than a chronicle of names, dates, places, and events. A proper understanding of history is built around the key events of the Bible and should be understood in terms of Christ and the building of His Church”.

“For these reasons, this history program concentrates on the unfolding of world history with a special emphasis on the shaping of Europe and America. It seeks to trace the hand of God's providence in history as He used the efforts of Christians as they applied God's Word to their nations and cultures”.

All history must be viewed as the sovereign rule of God over the affairs of men? I suppose this is why the inquisitions happened and why the period where the Christian Church did largely rule over government in Western Europe is correctly known as the Dark Ages. Since the key events of the Bible hold the only correct understanding of history it doesn’t make much sense to reference anything written since. I cannot imagine the backwards and ignorant progeny of this type of education would ever achieve anything in this world beyond the furtherance of blind hatred, tribal prejudice, and endless war. It is in such confined and constricted corners of ignorance where the Bin Ladens of the world are spawned. One of the little noted parts of the 9-11 commission’s report dealt with the source of much of the same information that Bin Laden today espouses; the madrasses or schools that Saudi Arabia funded with oil money from the US fostered the widespread acceptance of such radical views throughout the Middle East. The same type of indoctrinatory teaching is today being peddled in home schools without opposing viewpoints. In my view, the worst thing we could do as a society is to perpetuate this type of one dimensional teaching by educating a whole new generation by this methodology in our country.

Another book that purports to be a good teaching source about American government for high school students is titled “America’s Christian Heritage”. This book is further described with the following:

“Not too long ago, the fact that America was founded as a Christian nation was self-evident just by looking at the original documents and overflow of evidence. But sadly, with the rewriting of America’s history and the concerted effort of academic circles and the media to downplay this fact, this basis for our government is being lost.

Noted Christian historian, Gary DeMar, answers these secular denials of America’s Christian heritage as he presents evidence from a broad range of historical sources and lets the record speak for itself. This readable account is an excellent supplement for any history curriculum and government/civics course.

The quality of production and full-color spreads make this an ideal “coffee table book” that can open opportunities for discussion and sharing one’s faith and ideals.”

Sadly, there are those today who are indeed trying to rewrite America’s history but most of them seem to be fundamentalist Christians with an ideology to promote. The original documents and indeed the original writings of most of the Founding Fathers on the subject are chock full of the idea that the US government should NOT be a proponent of any one religious faith. The only people who argue against this notion do it from behind closed doors or bully pulpits where theirs is the only voice heard because they know that a fair examination of the facts will bear this out. Again, this doctrine is not dangerous only erroneous. However, if this doctrine is the ONLY one espoused and there is no open discussion of its merits it can and will lead to erroneous understandings by its adherents that can and will be dangerous to the future of this country because the young students of today are the leaders of tomorrow. This is both the source of my concern and the reason why adherents of this type of indoctrination are so avid in their efforts.

Another offering for teaching US Government principles is titled “American Government” which sounds innocuous enough. The book is described as follows:

“American Government breaks down the principles and mechanics of a constitutional republic into information the student can understand. Emphasis is given to the responsibility of Christian citizenship. The Constitution, political parties, elections, pressure groups, citizenship, and more, are taught from a biblical perspective. Each branch of the government is studied in detail. This course can be covered in one or two semesters; the one-semester course would then be followed by Economics”.

I would love to quote from the book itself but am not going to spend the $38.50 required to do so. I can only imagine the idiocy that could ensue trying to describe the Constitution, political parties, elections, pressure groups, citizenship and more from a biblical perspective. What I can’t imagine is how anyone remotely familiar with the basis of US Government could possibly conclude that using the biblical perspective is a good way to teach it to enquiring minds.

There is a long list of books on “intelligent design” and the refutations of evolution but I won’t bother to go into those as I don’t believe they impinge as directly on the problems I started out this post trying to discuss.

All of this boils down to the point that organized religion has shown itself to be much more a cause of war and violence than a solution. Even a casual perusal of history will bear this out in spades. I believe we are coming to a point in human history where we will either have to set these ancient tribal superstitions aside or allow them to destroy us. It seems obvious to me that the first step in this process is a fair and open discussion of the facts where all viewpoints are considered equally. Unfortunately, home schooling is the polar opposite of this type of discussion and serves to further propagate the problem by providing insulated pockets of indoctrinated belief wherein the light of reasoned debate never shines. It seems to me that if we accept the premise that a solution is needed to the problems we face in the world today we must accept the realization that it has to start with each of us.

Idle Rich Founders?

Being something of an amateur historian I am constantly reading history. One of my favorite types of books to read is a biography. Good biographies give more insight into an individual’s thought processes and back grounds so that the history that person influences can more directly be related to the most human of emotions and processes. I find it interesting to read several different biographies on one particular person and then read biographies on the people that this person interacted with during his or her lifetime to see how these interactions affect the course of human history. After all, human history is basically the net effect of personal interactions, not a time line of political and military movements. The core cause of political and military action can always be traced to the personal interactions of its leaders. Any other understanding of history is necessarily a confusion of cause and effect.

Some years ago I undertook to read a biography of each American president. As I am very interested in Colonial history especially this has been an eye opening experience in many ways. The more I read, the more I find that I want to read to more fully understand this same set of interactions. I am often led to reading biographies of other people besides the American presidents just to get a feel for the other side of the issues they argued for and against. It is fascinating to read the antithetical opposing views from some of our founding fathers because it is the combination of these views that actually led to the formation of our Constitution and our form of government. The first thing that stands out in such readings is the fact that there was NO consensus opinion that all the American Founding Fathers agreed upon with the possible exception of the fact that they felt it necessary to declare independence from Great Britain and even this declaration was shaded in many hues of disagreement as to how complete this separation should be. The fact of the matter is that there was barely a preponderance of opinion that this separation should occur at all. The best estimates suggest that the colonies were roughly divided in equal thirds on the question. One third gradually coming around to pushing for independence, one third pushing for a continuance of the status quo, and one third caring not a whit one way or another until the problem manifested itself into a war in their front yard.

We seem to have lost sight of the fact that many of the leaders of colonial governments here simply picked up and moved back to England when the war started while others readily joined the Royal forces in opposing Colonial efforts at independence. By any honest account, there was no universal agreement that the Colonies should separate from the crown and Parliament and only a protracted and expensive war and the entry of France into this war managed to allow those pushing for Independence to have their way and form a new and independent government.
After the war was successful the United States very nearly collapsed completely because of a stubborn insistence that each and every new state was a sovereign entity, bound to decide for itself on all questions of taxation and reparations of the huge national debt that the country had managed to bring on itself in winning this independence. This spirit of independence amongst the states was finally forced to be stamped out by the Constitutional Convention of 1787 whereby the weak and unenforceable Articles of Confederation were replaced with a federal government with some teeth to its authority when it came to dealing with the individual states. Even then, with the country on the verge of internal collapse and bankruptcy, it was a hard fought battle to get the independently minded states to agree to unite under a Federal Government.

Every time I hear one of the latter day talking heads of conservative radio rail about the intent of the founding fathers as if it exists in one viewpoint on stone tablets I cringe at their actual lack of understanding of history. The history of this country has never, ever been the whim of one side of the political spectrum but has always been a compromise between the left and the right. The net result of any democratic based governmental system is always a centrist position. This is necessarily a result of the inherent basic concept of the system whereby the majority rules. The centrist position shifts over time with the sway of public opinion but at any one time the centrist position will ALWAYS be the only position from which any political party can expect to control policy. Unfortunately, in this country today we are seeing a manipulation of this public perception of this position by largely artificial means. Advertising dollars control the media and if anyone thinks that the advertising dollars are coming from any position other than the far corporate right they are hopelessly confused and economically ignorant. Dollars buy TV and radio time and dollars are in much higher supply on the far right than anywhere else in this country today.

Leaving that line of thinking for a moment it has occurred to me from some of my recent readings of historical biographies how little our founding fathers actually had in common with the great mass of people who populate this country; both in Colonial times and in present times. There was a class structure in the society they came from that was largely inflexible and pronounced. While it may indeed have been less structured than the ones that existed in Europe and Great Britain at the time, it was still a class structure that was much more pronounced than what exists in this country today. In large part, that is because of the foresight of some of these early leaders and their recognition that for a truly Republican government to be effective it would have to be immune from the control of this structure.

Still, almost all of the founding fathers were from the upper middle class. Many of them were second generation wealthy as in most cases their immediate forebears had carved a higher standard of living for their children through hard work and good fortune in equal measures. This led to a unique circumstance in which people who were largely a product of the working class were also the new leisured class who were able to devote long hours to study of history, philosophy, and government. This group formed the heart and soul of the Founding Fathers and their unique perspective formed the basis of the first Republican government truly of the people and by the people on the face of this planet.

A few examples are in order here. George Washington, whose father was a land speculator, planter, sheriff and first generation self made man of the ruling class is one example. Washington was educated locally in somewhat less than a classical method but was taught mathematics, history, and sociology as a necessary primer to the duties that he would inherit as a landowner, planter, and leader in the community. In many ways Washington was different than many of his contemporaries in that he actually worked at a trade for part of his early life. Washington was a surveyor for a short period but beyond that he was much more interesting in military advancement than anything else. It must always be remembered that all these interests were simply supplemental to his main income which came from being a large landowner and sometimes absentee planter.

John Adams was a small landowner and largely self made man as a lawyer and local politician. While he was not as rich as many of his fellow founders, he was quite a successful trial lawyer and businessman which gave him ample free time for his later political pursuits. He was classically educated and a veritable encyclopedia of knowledge on history, philosophy, and many other scientific pursuits besides.

Thomas Jefferson was a second generation planter and owner of large quantities of slaves. Jefferson derived a steady if insufficient income for his tastes as an absentee planter and landowner for much of his career. He too was classically educated and spent numerous years and endless hours studying all manner of history and philosophy in his young adulthood. While he was early and often a member of political bodies in Virginia at the time he spent the vast majority of his time in contemplation and never could be bothered to put a vast amount of work into either his law business or his many planting concerns. As a member of the House of Burgesses and later Governor of Virginia he was often absent from meetings and on more than one occasion had to be rounded up forcibly by the sergeant at arms to fulfill his duties. Jefferson was endlessly curious about a vast variety of subjects and routinely dropped matters of political or financial importance to rush headlong into the minute study of some new and interesting subject. Jefferson was probably one of the most educated men of his time in a wide variety of fields but his work ethic left much to be desired throughout his life.

James Madison was a son of the largest landowner in Orange County, Virginia. He too was educated in the classics. He attended Princeton University but spent countless hours reading history, philosophy, and political writings of basically every period since the beginning of recorded history. Madison was a practicing lawyer but spent the vast majority of his time in government service while living quite well off of the proceeds of his inherited lands and slaves.

John Jay was the wealthy son of a mercantile magnate in New York. The Jay family came to this country as French Huegenots when France forced the protestants out of their country after the Edict of Nantes. Jay was educated in the classics as well and became a practicing lawyer but the majority of his support came from inherited wealth which gave him the opportunity to immerse himself in politics and nation building.

Benjamin Franklin was not born wealthy but became that way through hard work and good fortune in the printing business. He was basically retired from business at a fairly young age which allowed his expanding interest in politics and the human condition to have free reign for most of his later life. Franklin, who lived much more frugally than most of the founding fathers, was also much more of a believer in the possibilities of the common man’s abilities. I suspect this had as much to do with his upbringing and early training as the relative idleness of most of the founding fathers’ early years did with their eventual outlook.

I could go on in this vein but in the interest of avoiding redundancy I will stop. As anyone can plainly see the one trait that all these men shared was a certain amount of idle time, time that was not an absolute necessity in forging a means of putting food on the table or clothes on their children’s backs. The truly interesting part of this observation is how much spirit of sacrifice and sharing these men shared. While there are of course traces of class distinction in their writings and actions, they were exceedingly liberal in their views on sharing the wealth and spreading prosperity for all. It seems that most of these men well understood the principle that education and economic prosperity for all is a necessary component to a republican form of government.

It really is sad that most conservatives today who espouse to follow the Constitution as written seem to have lost this part of the concept. Perhaps they would be well served to study the actual writings of our founding fathers without the preconceived notion that this country was founded on the principal of the rich getting richer at the expense of everyone else. It is interesting how often such people tend towards self justification in all things. After all, if all you have is a hammer it is an unvarnished truism that everything soon begins to look like a nail.

Scots, Scotch, and a little Irish

One of my part time interests is Scotch; not the tape but the whisky. Scotch is as varied and diverse as the people who make it. Scots invented several things I find interesting as a matter of fact; maybe not practical but interesting nonetheless. Scots invented golf, bagpipes, and scotch whisky. I once read that golf is to sports what bagpipes are to music. I would say this is an apt comparison as both are alternately silly and frustrating while still hauntingly interesting.

For several centuries the Scots were the pit bulls of the world. No army worth its salt was without its Scots. The Scots have historically owed allegiance to no one but the clan and had a strange sense of honor that suggested serving as hired cannon fodder, shock troops, and soldiers of fortune in wars around the world was infinitely preferable to bending one’s knee to any man. On battlefields around the world the sound of the bagpipes meant the shit was getting ready to hit the fan and a lot of people were getting ready to meet violent ends. Fleeing poverty, a rigid class system, and perennially bad weather the Scots as soldiers of fortune were both efficient and feared wherever they appeared, and they appeared on battlefields the world over for a couple of centuries.

The Scots have historically been a pain to the rest of the world’s population. Obstinate, unyielding, clannish, and completely unfathomable to most every other race or group; the Scots have long been both the butt of jokes and the point of the sword. The English who are actually a bastard race of Angles, Saxons, Welsh, and Normans have on numerous occasions been so perplexed with what to do with the Scots that their best solutions have usually involved exporting them. First, they exported them to Ireland in an effort to repatriate that island with an English influence. This actually served to kill two birds with one stone; it got many of the Scots out of Northern England and it gave the Irish someone else to fight with besides the English. There is an old Irish saying that the only reason the Irish are still fighting amongst themselves is because they can’t find any other worthy opponents. The Scots seem to be an exception to this rule as Northern Ireland was emigrated with Scots by the English. The idea the English had was similar to the modern method of dealing with fire ants. One way to do this is to take some ants off of one hill and dump them on a nearby but separate hill. The fire ants will instantaneously begin to try to wipe each other out. While it seemed a good idea and is still actually bearing fruit in Northern Ireland as the Catholic and Protestant factions still fighting there today are actually the descendents of the Irish and the Scots respectively. To the horror of the English the two groups started to intermarry and produce a hybrid batch of even more fierce and obstinate fighters; the Scots-Irish.

The Scots-Irish were many of the earliest settlers in the North American Southern colonies. Pennsylvania, the Carolina piedmont areas, and later Georgia were their starting points in this country. Pennsylvania welcomed them until they found they were impossible to control as they spread ever westward onto new lands and began causing numerous problems with the Native American Indian tribes the colony had historically cooperated with. Spreading quickly across the unsettled western lands of the colonies, they were historically on the forefront of the frontier, unwilling or unable to abide by rules not of their own choosing they pushed all the way into Georgia where many of them came in as indentured servants released from debtor’s prisons in return for a term of servitude. They steadily progressed across the southeast and out to the western United States, always on the edge of civilization. Violent, vindictive, and unyielding they have historically been at the forefront of American armies and the leading edge of new settlements. Anyone who has ever felt a chill at the sound of bagpipes may have some of that blood coursing through their veins. Marked by an abundance of pride and a tendency towards vigilantism the Scots-Irish often became the face of frontier America.

Several years ago I began to take an interest in Scotch Whisky. I don’t claim to be an expert but I do claim to be an avid consumer. The first thing to understand about Scotch is that there are many different grades, flavors, and types. Single malts are made entirely of barley malted entirely from one distillery as opposed to blended Scotch which is often blended from several different vats. As a rule of thumb, single malts are usually better in quality and taste.

Scotch is somewhat like wine in that it tends to take on the flavor of the land from which it springs. Water and soil mixtures flavor the barley from which it is distilled as well as the water which is used to make the whisky itself. It is something of a matter of personal taste as to what it good scotch vs. not so good scotch but I will list a few of my favorites and not so favorite.

1) Oban- Oban comes in several different ages as do most Scotch Whiskeys. Oban is from the west coast town of Oban. It comes from one of the smaller distilleries with only two pot stills on site. If you want to taste a good single malt, I recommend Oban highly. It is a little pricey but you get what you pay for with this one.

2) Aberlour- Aberlour comes in several different agings and several different types of casking combinations. The twelve year old variety is my favorite so far and is a little less pricey than Oban; but with the same kind of distinct flavor. Aberlour comes from the town of Aberlour near Speyside, Scotland where the rivers Lour and Spey cross. The uniqueness of the climate and water makes for a smooth and distinct flavor; well worth the cost and a pleasure to drink.

3) Famous Grouse- Famous Grouse is a blended scotch, made primarily from a combination of Glennrothes, Highland Park Single Malt, and Macallan Single Malt. It is a very interesting blend; relatively inexpensive but smooth and easy to drink. Maybe it says something of my own Scots-Irish nature that my standby every day Scotch is a cheaper blended whisky but this is a good one if you are on a budget.

4) Macallan Single Malt- Macallan is a premium single malt that I personally think is something less than good. I much prefer the Famous Grouse above to its more expensive ingredient of this single malt. Somewhat of a fruity taste and a harsher alcohol taste are it’s signature as far as I can tell.

5) Balvenie- Another Speyside Single malt. The distillery is based in Dufftown, Scotland. If you are going to buy a single malt I wouldn’t recommend this one. A little less fruity than the Macallan’s but without the smoothness of Aberlour, I would say it is a little better than Macallan’s and a little worse than the Famous Grouse…. But then I don’t claim to be an expert.

6) Glen Moray- Another Speyside Single malt. Glen Moray started life as a brewery and was later converted to a distillery. It fell into disrepair and hard times as the owners concentrated more on Aberlour but was at some point purchased by Glenmorangie. I recently bought a bottle at a bargain price and would recommend it highly. Not as good as Aberlour or Oban, it is nonetheless better than many of the more expensive single malts listed above.

7) Glenmorangie- A single malt having the distinction of the tallest stills in Scotland. Glenmorangie is made in Tain, Rosshire, Scotland whatever that means. It is a smooth whisky with a somewhat fruity taste. I would rate it lower than it rates itself but if you like a fruitier taste it would probably be an excellent choice.

8) Speyburn Single Malt- I recently purchased a bottle of this single malt at a bargain basement price. I was rewarded with what was described as a full bouquet smell of apple when I opened the bottle. If you want to smell apples go to the farmer’s market. If you want a bouquet buy flowers. Speyburn resembles many things; unfortunately one of them is not Scotch. I actually tried to carry it back and when they wouldn’t take it back I told them to just pour it out. Paint thinner might not have its bouquet or “nose” but it probably tastes as much like Scotch.