Here’s more on the subject of how state interference in the economy kills innovation.

From the Wall Street Journal:

Here’s a stumper: In the Treasury financial reform proposal, who comes in for more regulatory retooling: Fannie Mae, or your average 14-man venture capital shop? If you said venture capital, you understand why one of America’s greatest competitive advantages is now at risk in Washington.

 As part of their regulatory redesign, Team Obama and Congress still don’t have a plan for reforming the giant taxpayer-backed institutions like Fannie that caused the credit crisis. Yet they’re moving to rewrite the rules for investing in tiny technology companies that had nothing to do with the meltdown. Under the proposed rules, venture firms will be declared systemic risks until they can prove themselves innocent. The typical venture capital (VC) firm has nine principals plus five support staff and doesn’t use leverage. Yet Treasury Secretary Timothy Geithner wants VCs to be regulated as investment advisers by the Securities and Exchange Commission…

Venture firms were invented in the 1960s to fund the California semiconductor companies that would change the world but needed investors willing and able to take a flying leap into the unknown. Under the Silicon Valley model that has since spread around the country, experienced technology executives at VC firms inject advice and cash into young businesses.

 Neither too big nor too interconnected to get a taxpayer bailout, VCs are nonetheless critical to America’s ability to stage an economic rebound. While early-stage venture investments are tiny by Wall Street standards—often $3 million or less—they are a big part of the reason the United States has for decades grown faster than other industrialized economies. Companies once backed with venture capital now generate more than 20% of U.S. gross domestic product. Looking forward, will America be better off if venture investors are justifying themselves to Washington regulators, or evaluating new software platforms?…

Treasury’s position is that if it doesn’t drag VC firms into the bureaucratic swamp, then high-rolling hedge funds playing with borrowed money will present themselves as venture funds to avoid regulation. Yet any firm calling itself a VC is already subject to the antifraud provisions of federal securities laws. VCs also have to describe the funds they raise in annual Form D filings with the SEC. Washington could let the SEC address any concerns simply by adding three questions to the form: Do you use leverage? Do you trade equities or debt? Do you trade derivatives? Anyone answering “no” to all three would be free to go find the next Microsoft.

 The reality is that the venture industry is already shrinking, for market and political reasons. Too many funds chasing too few ideas after the dot-com boom have limited returns. And thanks in part to earlier VC investments, cheap tech tools are allowing some Web entrepreneurs to bootstrap their businesses without having to sell pieces to VCs.

As for the politics, Sarbanes-Oxley compliance costs, Eliot Spitzer’s stock-analyst settlement and the economic downturn have created an historic drought in venture-backed companies going public. This week Dow Jones VentureWire warned readers not to expect more such companies going public “anytime soon.” It boggles the mind that Washington would enact new policies sure to prolong this drought and strike at the heart of American innovation.

More on the abasement – and decline – of the United States by former president Clinton’s groveling to Kim Jong Il on behalf of President Obama:

Bruce Thornton writes:

The great powers of history understood the truth of Virgil’s dictum that “they have power because they seem to have power.” As much as soldiers and weapons, prestige and perception are critical for a great power’s ability to pursue and defend its interests. Both allies and adversaries must show by their behavior that they respect and honor a dominant state, and understand that consequences will follow the failure to do so. And to reinforce the perception of its power, a major power must be willing to take actions that demonstrate that is worthy of this respect. To do otherwise is to create a perception of weakness and to invite encroachments on the state’s security and interests. The decline of great empires like that of Rome or of England is in part a consequence of the loss of this respect on the part of enemies and rivals, and the perception that they were weak rather than strong.

Unfortunately, this is a wisdom that the United States has forgotten, as evidenced by former President Bill Clinton’s recent trip to North Korea to rescue two reporters who had been imprisoned for “illegally” entering North Korean territory. Many will no doubt praise Clinton’s “diplomacy” and hope that it may jump-start the languishing efforts to pry loose North Korea’s nuclear arsenal from Kim Jong-il’s dying grip. In fact, the whole episode is another in a series of humiliations, whether petty or serious, that have damaged America’s prestige and convinced its enemies that for all our power, we are weak and vulnerable.

How else can one understand the sorry spectacle of the one-time leader of the world’s most powerful state flying cap in hand to a dysfunctional country ruled by a psychopathic thug? Does anybody think it shows strength for Clinton to apologize to said thug on behalf of two Americans who had been wrongly arrested and jailed? Doesn’t it rather redound to North Korea’s prestige that it has compelled a representative of American power to solicit a favor, pose for photos, and chit-chat with one of the most brutal dictators of recent history? And who knows what other concessions were promised or implied.

Legitimizing rogue regimes and dictators, and creating the perception of equality by summits, conferences, and photo-ops, does not advance our interests. The symbolic elevation of such regimes necessitates the degradation of the United States, for what we think of as a demonstration of strength––that we can resolve disputes just with talk–– our adversaries see as craven weakness…

Some may argue that our strength lies in our principles such as the rule of law and a preference for reasoned discussion over force. Indeed it does––but only when it is clear that our power lies behind our principles, that we believe in them ardently enough to use force not for territory or wealth, but to strengthen our principles and defend our security when we have determined they have been attacked. But to think that those principles and beliefs can stand on their own without being guaranteed by force is delusional, for the simple reason that most of our adversaries do not believe in the same principles. To our enemies, those principles are not self-evidently the best way to live, and so our adversaries must be compelled to respect these principles with deeds rather than words. The prestige of our principles depends on the prestige of our power.

Liberals, however, have a different view of foreign policy. They think that our adversaries are like us and believe in the same goods, such as the resolution of conflict through reasoned discussion, and so liberals take force off the table. They think that our example alone will be sufficient to convince our enemies to change their behavior. We see this approach in the current administration’s overtures to Iran. More discussion, more diplomacy, more offers of various material boons like increased trade supposedly will convince the mullahs to forgo the enormous boost in power and prestige they will enjoy by possessing nuclear arms.

Yet without the credible threat of force, all this diplomacy does not mean a thing to a regime that has nothing but contempt for us. Why else would they imprison three of our citizens? They know they will pay no price for dishonoring us in that way, that instead we will offer concessions, whether material or symbolic, the end result of which will be to further Iran’s prestige as a regime willing to stand up to the Great Satan and expose once again its weakness and corruption.

This decline in America’s prestige started after the debacle of Vietnam, where a military victory was squandered because of a massive failure of nerve on the part of both Congress and the people. Four years later, Iran confirmed the estimation of our weakness by seizing with impunity our citizens and embassy. In 1983, we failed to punish Iran for its part in helping Hezbollah blow up 241 of our soldiers. Ten years later, we ran from Mogadishu after 18 of our soldiers were killed, putting the QED to our enemies’ perception that we were through as a great power…

And now a new administration promises to repeat the same mistakes: avoiding the hard choices and tragic consequences a great power must accept in order to remain a great power, relying instead on words to pursue aims only deeds can achieve. If this policy persists, the perception of our weakness could very well in the end be more powerful than all our armies and weapons.

Read the whole of this good article here.

From Investor’s Business Daily:

Laura Ling and Euna Lee, the journalists … were nabbed by Kim Jong Il’s security forces while on a reporting mission on the China border five months ago, and a government tribunal sentenced them to 12 years of hard labor. In North Korea, hard labor means hard labor. Had the sentences been carried out, one or both might have died in custody…

Make no mistake: They weren’t prisoners; they were hostages… By picking Clinton for this “private, humanitarian mission,” [of going to North Korea to rescue them]… the U.S. seemed to be sending a not-so-subtle signal to Kim that the U.S. is ready to appease him.

For in addition to being a former commander in chief, Clinton is the husband of the current secretary of state. And his own secretary of state, Madeleine Albright, was the first to visit North Korea.

Far from private, this has White House fingerprints all over it. As the AP noted: “State media said Clinton apologized on behalf of the women and relayed President Barack Obama’s gratitude.”

Groveling, anyone? Kim now knows the current U.S. leader can be blackmailed — if he didn’t know it before. That’s what made President Clinton so appropriate for this mission. It was from Clinton that Kim first learned this lesson.

In 1994, recall, Clinton sent former President Carter — see a pattern? — to North Korea to negotiate that country’s denuclearization. Carter returned with a deal similar in its sycophancy and cynicism to the one Neville Chamberlain brought back from Munich.

In exchange for billions of dollars in food aid and even help for its “peaceful” nuclear power effort, North Korea vowed to behave and decommission its nuclear weapons program.

No sooner had the ink dried than North Korea began cheating. During the Clinton years, the U.S. and the U.N. signed three agreements with North Korea. North Korea broke its word each time.

Commander in chief? Clinton acted like appeaser in chief. We never learned. The deal making continued into the 2000s — culminating in the Six-Party Talks, which concluded in 2007.

Again, Pyongyang broke its word and bought more time with its outrageous behavior. Today it has a burgeoning missile program and nuclear weapons, plus has sold that technology to other rogue states, including Iran. Rather than being conciliatory, the U.S. should have been righteously angry. Instead, U.S. weakness with North Korea is tempting others.

In Iran, just this week, President Mahmoud Ahmadinejad’s security forces arrested three young American journalists for an alleged border violation. Coincidence? Probably not. It follows the arrest earlier this year of U.S. journalist Roxana Saberi, who was released in May — just before Iran’s elections.

Clearly, Iran has learned the same valuable lesson as Kim — threaten captured Americans with harsh punishment, use them as pawns, then watch us grovel for the favor of their release.

Time to start spying on your friends, family, and neighbors, and reporting them to the state authorities if they show signs of dissenting from the Dear Leader’s declared orthodoxy. 

From the official White House website:

There is a lot of disinformation about health insurance reform out there, spanning from control of personal finances to end of life care.  These rumors often travel just below the surface via chain emails or through casual conversation.  Since we can’t keep track of all of them here at the White House, we’re asking for your help. If you get an email or see something on the web about health insurance reform that seems fishy, send it to [email protected].

Hullo socialism, good-bye innovation. Socialism crushes inventiveness, as it purposefully does all private enterprise. Nothing new of any importance has come out of continental Europe since it turned socialist.

In Britain where the first Industrial Revolution took place, yes, there is still a remnant of the old inventive genius at work, though it’s slowly dying. Out of Britain has come one big new thing – the world-wide web, invented by Sir Tim Berners-Lee, blessings be upon him. (NOT by Al Gore, who claimed he invented it, but could not, we believe, invent a hand fan for a breeze.) 

To invent, men need not only their ideas but also a superfluity of time and money, even if they do it in their own garages as so many did in the Second Industrial Revolution in Silicone Valley. (I say men because women have invented sweet blow-all.) Free time and extra money, and the incentive of gaining great riches, are among the great benefits that only capitalism can bestow.  

Now that socialism is coming to the United States, incentive, opportunity and the urge to innovate will start to wither. Nationalized health care, for instance, will mean the stagnation of medical research. Will the billions needed to develop a new drug come from the state when the state is the only buyer?

The only sphere in which innovation has worked well under state control is the military. That was because American leaders have taken defense, the paramount responsibility of the state, very seriously. But now America has a president who believes that the nation is over armed – and should aim at totally giving up its nuclear defenses. Obama reckons, we are told, that if America castrates itself in this way, other nations will be so impressed by its ‘moral leadership’ that they too will give up the nuclear weapons they have, or the wish to obtain them. Either he really believes this sentimental hogwash or his motive is much darker and more sinister.

Michael Barone writes in Townhall:

Most people in the rest of the world are free riders on the productivity and ingenuity of the American military and American medicine. They get the benefits of American military protection and American medical innovation without paying, or without paying in full, for them. 

This has been the case all through the six decades after the Second World War. The American military has protected democracies from Communist expansion and today protects people all over the world from Islamist extremists. They get this service, if not free of charge, then at reduced rates. American taxpayers have been spending 4 percent of gross domestic product on our military and during the Cold War paid twice that share. NATO and most other allies spend significantly less.

American administrations of both parties have tried to get others to spend. But this is Sisyphus’s work. We are entitled to take pride in the fact that, in the spirit of “From those to whom much is given much is asked,” we are able to do so much for others.

Unfortunately, the Obama administration wants to do less. Defense has been scheduled for spending cuts. We are halting at lower than scheduled levels production of the F-22 fighter, whose brilliant advanced design is intended to assure American control of the skies for decades to come. The administration also seems to be scaling back missile defense, which could protect friends and allies from nuclear attack and over time might discourage nuclear proliferation…

We also may be at risk of squandering our high-tech advantage in medicine. As Scott Atlas of the Hoover Institution points out, the top five American hospitals conduct more clinical trials than all the hospitals in all other developed countries. America has outpointed all other countries combined in Nobel Prizes for medical and physiology since 1970.

American theoretical health research financed by the National Institutes of Health and by American market-oriented pharmaceutical companies outshines the rest of the world combined. And the rest of the world tends to get the benefits at cut rates… 

Pharmaceutical companies that produce benefits for patients and consumers get the profits that support their research disproportionately from Americans, because other countries refuse to spend much more than the cost of producing pills, which is trivial next to the huge cost of research and regulatory approval. Getting these free riders to pay more is, again, Sisyphus’s work.

The Democratic health care bills threaten to undermine innovation in pharmaceuticals and medical technologies by sending those with private insurance into a government insurance plan that would be in a position to ration treatment and delay or squelch innovation. The danger is that we will freeze medicine in place and no longer be the nation that produces innovations that do so much for us and the rest of the world.

Walter E. Williams, one of the rare writers who think freshly, clearly, and profoundly, writes:

The first thing we should acknowledge is that we live in a world of harms. Harm is reciprocal. For example, if the government stopped Hewlett-Packard and Texas Instruments from harming Keuffel & Esser and Pickett , or stopped General Electric from harming ice producers, by denying them the right to manufacture calculators and refrigerators, they would have been harmed, plus the billions of consumers who benefited from calculators and refrigerators. There is no scientific or intelligent way to determine which person’s harm is more important than the other. That means things are more complicated than saying that one person has no rights to harm another. We must ask which harms are to be permitted in a free society and are not to be permitted. For example, it’s generally deemed acceptable for me to harm you by momentarily disturbing your peace and quiet by driving a motorcycle past your house. It’s deemed unacceptable for me to harm you by tossing a brick through your window.

In a free society, many conflicting harms are settled through the institution of private property rights. Private property rights have to do with rights belonging to the person deemed owner of property to keep, acquire, use and dispose of property as he deems fit so long as he does not violate similar rights of another. Let’s say that you are offended, possibly harmed, by bars that play vulgar rap music and permit smoking. If you could use government to outlaw rap music and smoking in bars, you would be benefited and people who enjoyed rap music and smoking would be harmed. Again, there is no scientific or intelligent way to determine whose harm is more important. In a free society, the question of who has the right to harm whom, by permitting rap music and smoking, is answered by the property rights question: Who owns the bar? In a socialistic society, such conflicting harms are resolved through government intimidation and coercion.

What about the right to harm oneself, such as the potential harm that can come from not wearing a seatbelt. That, too, is a property rights question. If you own yourself, you have the right to take chances with your own life. Some might argue that if you’re not wearing a seatbelt and wind up a vegetable, society has to take care of you; therefore, the fascist threat “click it or ticket.” Becoming a burden on society is not a problem of liberty and private property. It’s a problem of socialism where one person is forced to take care of someone else. That being the case, the government, in the name of reducing health care costs, assumes part ownership of you and as such assumes a right to control many aspects of your life. That Americans have joyfully given up self-ownership is both tragic and sad.

Burt Prelutsky writes:

Ever since the presidential campaign, when Obama told the guy with the ailing elderly mother that instead of an operation, he should consider pain pills as the more sensible option, I knew this cold-blooded good-for-nothing was a man born, not to govern a nation, but to run a gulag. 

But what makes it even worse is that the people in Washington who’d like to put old folks on ice floes and stick the rest of us in under-staffed medical clinics have no intention of sharing our sorry fates. Do you think Charley Rangel is going to take a number and twiddle his thumbs if he needs to have his 79-year-old gall bladder removed? Do you think that Marian Robinson, Obama’s 72-year-old mother-in-law, is going to be given a pain pill if she ever needs a liver transplant? As George Orwell put it in “Animal Farm,” which could well have served as a training manual for Obama’s administration, “All animals are equal, but some are more equal than others.”

Still, say what you will about the Obamas, no one can deny that they aren’t doing all they can to combat unemployment. For instance, Barack is appointing so many czars, you’d think his last name was Romanov. In the meantime, Michelle has gathered a larger staff of courtiers and ladies-in-waiting than Madame Pompadour and Madonna put together. There were, at last count, 22 people answering directly to the First Lady, costing the taxpayer roughly $1.6 million a year. In Mrs. Obama’s case, these servants are called, among other things, Director of Communications for the First Lady, Deputy Social Director, Director of Scheduling and Associate Director of Correspondence. I swear there’s even an underling who goes by the title of Deputy Associate Director of Correspondence. In the Obama White House, it seems that even the gofers have gofers.

Max Boot writes:

The Sydney Morning Herald reports, based on “evidence from key defectors,” that “Burma’s isolated military junta is building a secret nuclear reactor and plutonium extraction facilities with North Korean help, with the aim of acquiring its first nuclear bomb in five years.”

Just what the world needs to go along with the North Korean bomb and the (soon to come) Iranian bomb — the Burmese bomb.

I wonder what would lead the Burmese junta to think it could get away with such a dangerous and destabilizing move? Gee, perhaps Iran and North Korea suffering absolutely no serious repercussions may have had something to do with it?

This development shows just how dangerous the Iranian and North Korean programs are — not just in and of themselves but also for how they encourage nuclear proliferation in other rogue states.

From Iowahawk: 

With apologies to Geoffrey Chaucer

 

1  Whan in Februar, withe hise global warmynge

2  Midst unseasonabyl rain and stormynge

3  Gaia in hyr heat encourages

4  Englande folke to goon pilgrimages.

5  Frome everiches farme and shire

6  Frome London Towne and Lancanshire

7  The pilgryms toward Canterbury wended

8  Wyth fyve weke holiday leave extended

9  In hybryd Prius and Subaru

10  Off the Boughton Bypasse, east on M2.

11  Fouer and Twyntie theye came to seke

12  The Arche-Bishop, wyse and meke

13  Labouryte and hippye, Gaye and Greene

14  Anti-warre and libertyne

15  All sondry folke urbayne and progressyve

16  Vexed by Musselmans aggressyve.

17  Hie and thither to the Arche-Bishop’s manse

18  The pilgryms ryde and fynde perchance

19  The hooly Bishop takynge tea

20  Whilste watching himselfe on BBC.

21  Heere was a hooly manne of peace

22  Withe bearyd of snow and wyld brows of fleece

23  Whilhom stoode athwart the Bush crusades

24   Withe peace march papier-mache paraydes.

25  Sayeth the pilgryms to Bishop Rowan,

26  “Father, we do not like howe thynges are goin’.

27  You know we are as Lefte as thee,

28  But of layte have beyn chaunced to see

29  From Edinburgh to London-towne

30  The Musslemans in burnoose gowne

31  Who beat theyr ownselfs with theyr knyves

32  Than goon home and beat theyr wyves

33  And slaye theyr daughtyrs in honour killlynge

34  Howe do we stoppe the bloode fromme spillynge?”

35  The Bishop sipped upon hys tea

36  And sayed, “an open mind must we

37  Keep, for know thee well the Mussel-man

38  Has hys own laws for hys own clan

39  So question not hys Muslim reason

40  And presaerve ye well social cohesion.”

41  Sayth the libertine, “’tis well and goode

42  But sharia goes now where nae it should;

43  I liketh bigge buttes and I cannot lye,

44  You othere faelows can’t denye,

45  But the council closed my wenching pub,

46  To please the Imams, aye thaere’s the rub.”

47  Sayeth the Bishop, strokynge his chin,

48  “To the Mosque-man, sexe is sinne

49  So as to staye in his goode-graces

50  Cover well thy wenches’ faces

51  And abstain ye Chavs from ribaldry

52  Welcome him to our communitie.” 

53  “But Father Williams,” sayed the Gaye-manne 

54  “Though I am but a layman

55  The Mussleman youthes hath smyte me so

56  Whan on streets I saunter wyth my beau.”

57  Sayed the Bishop in a curt replye

58  “I am as toolrant as anye oothere guy,

59  But if Mussleman law sayes no packynge fudge,

60  Really nowe, who are we to judge?”

61  Then bespake the Po-Mo artist,

62  “My last skulptyure was hailed as smartest

63  Bye sondry criticks at the Tate

64  Whom called it genius, brillyant, greate

65  A Jesus skulpted out of dunge

66  Earned four starres in the Guardian;

67  But now the same schtick withe Mo-ha-med

68  Has earned a bountye on my hed.”

69  Sayed the Bishop, “that’s quyte impressyve

70  To crafte a Jesus so transgressyve

71  But to do so with the Muslim Prophet

72  Doomed thy neck to lose whats off it.

73  Thou should have showen mor chivalrie

74  In committynge such a blasphemie.”

75  And so it went, the pilgryms all

76  Complaynynge of the Muslim thrall;

77  To eaches same the Bishop lectured

78  About the cultur fabrick textured

79  With rainbow threyds from everie nation

80  With rainbow laws for all situations.

81  “But Father Rowan, we bathyr nae one

82  We onlye want to hav our funne!”

83  “But the Musselman is sure to see

84  Thy funne as Western hegemony.

85   ‘Tis not Cristian for Cristians to cause

86  The Moor to live by Cristendom’s laws

87  Whan he has hise sovereyn culture

88  Crist bade us put ours in sepulture.

89  To be divyne we must first be diverse

90  So cheer thee well, thynges could be wors

91  Sharia is Englishe as tea and scones,

92  So everybody muste get stoned.”

93  The pilgryms shuffled for the door

94  To face the rule of the Moor;

95  Poets, Professors, Starbucks workers

96  Donning turbans, veils and burqqas.

97  As they face theyr fynal curtan

98  Of Englande folk, one thynge is certan:

99  Dying by theyr own thousande cuts,

100  The Englande folk are folking nuts.