The free market is the engine of our civilization. It works. Works best if it is not interfered with by government. Works as a spontaneous system of co-operation and division of labor.

On which subject, here is part of a splendid short essay by Jonah Goldberg. He writes:

No one in the world knows how to make the newspaper you are holding (and, if you’re reading this on your phone, computer, iPad or Kindle, no one knows how to make those things either).

Even the best editor in the world has no clue how to make a printing press or the ink, or how to operate a communications satellite.

This is hardly a new insight. In 1958, Leonard Read wrote one of the most famous essays in the history of libertarianism, “I, Pencil.” It begins, “I am a lead pencil — the ordinary wooden pencil familiar to all boys and girls and adults who can read and write.” It is one of the most simple objects in human civilization. And yet, “not a single person on the face of this earth knows how to make me.”

The pencil tells the story of its own creation. The wood comes from Oregon, or perhaps California. The lead, which is really graphite, is mined in Ceylon (now Sri Lanka). The eraser, which is not rubber but something called “factice” is “made by reacting rape-seed oil from the Dutch East Indies with sulfur chloride.”

To make a long story short, the simple act of collecting and combining the ingredients of a pencil involves the cooperation of thousands of experts in dozens of fields, from engineering and mining to chemistry and commodity trading. I suppose it’s possible for someone to master all of the knowledge and expertise to make a pencil all by themselves, but why would they?

The lessons one can draw from this fact are humbling. For starters, any healthy civilization, never mind any healthy economy, involves unfathomably vast amounts of harmonious cooperation. …

These days there’s a lot of buzz about something called “cloud computing.” In brief, this is a new way of organizing computer technology so that most of the data storage and number crunching doesn’t actually take place in your own computer. Rather, everyone plugs into the computational equivalent of the electrical grid.

Do a Nexis search and you’ll find hundreds of articles insisting that this is a “revolutionary” advance in information organization. And in one sense, that’s obviously true. But in another this is simply an acceleration of how civilization has always worked. The information stored in an encyclopedia or textbook is a form of cloud computing. So is the expertise stored in your weatherman’s head. So are the intangible but no less real lessons accumulated over generations of trial and error and contained in everything from the alphabet to the U.S. Constitution …

More relevant, the modern market economy is the greatest communal enterprise ever undertaken in the history of humanity. Friedrich Hayek did the heavy lifting on this point over half a century ago in his essay “The Use of Knowledge in Society.” The efficient pricing of markets allows millions of independent actors to decide for themselves how to allocate resources. According to Hayek, no central planner or bureaucrat could ever have enough knowledge to consistently and successfully guide all of those economic actions in a more efficient manner. …

According to progressives, the financial crisis discredited “market fundamentalism” and created a burning need for a more cooperative society where “we’re all in it together.” It’s an ancient argument, with many noble intentions behind it. But it rests on a misunderstanding of one simple, astounding, irrefutable fact. The market economy is cooperative, and more successfully so than any alternative system ever conceived of, never mind put into practice. Admittedly it doesn’t feel that way, which is why everyone wants to find a better replacement for it. But they never will, for the same reason no one can make a pencil.

Find Leonard Read’s classic essay I, Pencil here, either to refresh your memory and enjoy it anew, or to learn its lesson for the first time. It is essential to the proper education of every generation.

Obama’s chief economic adviser, Christina Romer, admits that the Keynesian economic policy she (among others) advised Obama and the Democrats to adopt and implement, which they did eagerly as it was the redistributionist policy they wanted, was wrong and has failed.

The Washington Post reports:

Christina Romer, chairman of President Obama’s Council of Economic Advisers, was giving what was billed as her “valedictory” before she returns to teach at Berkeley, and she used the swan song to establish four points, each more unnerving than the last:

She had no idea how bad the economic collapse would be.

She still doesn’t understand exactly why it was so bad.

The response to the collapse was inadequate.

And she doesn’t have much of an idea about how to fix things.

What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: “Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare.” …

At week’s end, Romer will leave the council chairmanship after what surely has been the most dismal tenure anybody in that post has had: a loss of nearly 4 million jobs in a year and a half. … She was the president’s top economist during a time when the administration consistently underestimated the depth of the economy’s troubles – miscalculations that have caused Americans to lose faith in the president and the Democrats.

Romer had predicted that Obama’s stimulus package would keep the unemployment rate at 8 percent or less; it is now 9.5 percent. … The economy lost 350,000 jobs in June and July. …

When she and her colleagues began work, she acknowledged, they did not realize “how quickly and strongly the financial crisis would affect the economy.” They “failed to anticipate just how violent the recession would be.”

Even now, Romer said, mystery persists. “To this day, economists don’t fully understand why firms cut production as much as they did or why they cut labor so much more than they normally would.” Her defense was that “almost all analysts were surprised by the violent reaction.”

That miscalculation, in turn, led to her miscalculation that the stimulus package would be enough to keep the unemployment rate from exceeding 8 percent. Without the policy, she had predicted, unemployment would soar to 9.5 percent. The plan passed, and unemployment went to 10 percent. …

The truth is that the Obama administration is pretty much out of options. … “What we would all love to find – the inexpensive magic bullet to our economic troubles – the truth is it almost surely doesn’t exist,” Romer admitted.

Okay, there is no magic bullet – but there is the invisible hand.

It’s also called the free market.

Free marketeers would lower taxes, remove the minimum wage and the multifarious bureaucratic burdens on employers, and above all forbid government interference in the market. That is to say, they would reverse the policy of high spending by the state which Romer advised, Obama and the Democrats wanted, and even President Bush was seduced into attempting.

Economically wise conservatives have been telling liberals for decades, Keynes was wrong, Hayek was right.

Will the Republicans remember that when they regain Congressional power in November?

Fannie Mae and Freddie Mac, the two mortgage giants, “should be abolished”.

Of course. But who says so now?

No other than their greatest champion through the many years of their corrupt practices – Representative Barney Frank.

It was because Barney Frank defended Fannie and Freddie from investigation and oversight that the subprime mortgage disaster pitched the world into economic crisis.

That is why Barney Frank bears a personal responsibility for the recession and the debt Americans have to bear.

Okay, he’s not the only one to blame, but he’s one of the most guilty, along with Presidents Carter and Clinton, and Senator Chris Dodd.

From our post Moment of decision, Sept 29, 2008:

Jimmy Carter, 1977. The Community Reinvestment Act. Banks must make loans to high-risk borrowers.

Bill Clinton, devotee of multiculturalism, pressed for more home-ownership by those who could not afford it, minorities and in effect even illegal immigrants, and Fannie Mae and Freddie Mac responded, buying up hundreds of billions of dollars of the bad loans and sellng them on the world markets.

Barney Frank and Chris Dodd who ran Congress’s banking panels, vigorously and persistently opposed Republican Party efforts to regulate Fannie and Freddie.

From our post Free market not to blame for economic crisis, Oct 4, 2008, quoting Thomas Sowell:

It was liberal Democrats, led by Senator Christopher Dodd and Congressman Barney Frank, who for years –  including the present year – denied that Fannie Mae and Freddie Mac were taking big risks that could lead to a financial crisis.

It was Senator Dodd, Congressman Frank and other liberal Democrats who for years refused requests from the Bush administration to set up an agency to regulate Fannie Mae and Freddie Mac.

It was liberal Democrats, again led by Dodd and Frank, who for years pushed for Fannie Mae and Freddie Mac to go even further in promoting subprime mortgage loans, which are at the heart of today’s financial crisis.

From our post Ten most corrupt politicians, December 31, 2009, quoting Judicial Watch:

Judicial Watch uncovered documents in 2009 that showed that members of Congress for years were aware that Fannie Mae and Freddie Mac were playing fast and loose with accounting issues, risk assessment issues and executive compensation issues, even as liberals led by Rep. Frank continued to block attempts to rein in the two Government Sponsored Enterprises (GSEs)… Frank received $42,350 in campaign contributions from Fannie Mae and Freddie Mac between 1989 and 2008. Frank also engaged in a relationship with a Fannie Mae Executive while serving on the House Banking Committee, which has jurisdiction over Fannie Mae and Freddie Mac.

Obama blamed Wall Street and the banks for the crisis, and did nothing to stop the real culprits. Instead of shutting down Fannie and Freddie, he made its easier for them to carry on undermining the economy.

From our post Fannie and Freddie: the dirty dance goes on, January 4, 2010, quoting Bruce Bialosky at Townhall:

[Fannie Mae and Freddie Mac], which together own or guarantee over one half of home mortgages, and which had previously been injected with a $111 billion bailout, received an unexpected Christmas present from the Obama Administration: an executive order, issued in the dark of the night … The Treasury announced they were eliminating the $400 billion limit available to these two entities – in essence giving them license to fritter away as much money as they want while the American people (and their grandchildren) pick up the tab …

What seems to be missing is major reform of the lending practices. There’s no evidence that they’ve become more vigilant in their loan procedures, or more attentive to the credit-worthiness of the borrowers. In fact, it seems pretty clear that they have resumed their lending habits of old.

Proportional fault has never been placed on Fannie Mae and Freddie Mac for the subprime loan crisis.

Because these entities have been protected by Barney Frank in the House and Christopher Dodd in the Senate, the two lenders have escaped the kind of brutal public scrutiny visited upon banks and other lenders. While bankers have been on the hot seat and skewered by late night comedians, the people who run these behemoths have escaped unfazed.

And now it is Barney Frank, of all people, who want them to be abolished.

Investor’s Business Daily comments today:

After years of dissembling and denial, Rep. Barney Frank has finally come out. He now says bankrupt government mortgage giants Fannie Mae and Freddie Mac “should be abolished.” Better late than never.

‘There were people in this society who for economic and, frankly, social reasons can’t and shouldn’t be homeowners,” Frank said in an interview with the Fox Business Network and sounding a lot more like an elephant than a donkey. “I think we should, particularly, stop this assumption that you put everybody into homeownership.”

Barney Frank said that?

(What else is happening today? Are pigs flying? Is the Pope denouncing Christianity? Is Obama siding with America?)

After years of blaming heartless Republicans and Wall Street for the crisis caused by Fannie Mae and Freddie Mac — and their predominantly Democratic supporters in Congress — it’s refreshing to hear a member of the Democratic Party admit his mistakes.

It’s especially true of Frank, who, more than any other elected official, championed the cause of the government-sponsored enterprises Fannie Mae and Freddie Mac. Indeed, Frank is most responsible for stopping GSE reform in the early 2000s, at a time when such a move might have prevented the financial meltdown. …

In 2000, when Rep. Richard Baker proposed more oversight for the GSEs, Frank called concerns about Fannie and Freddie “overblown,” claiming there was “no federal liability whatsoever.”

In 2002, again, Frank said: “I do not regard Fannie Mae and Freddie Mac as problems. I regard them as assets.”

In 2003, he repeated himself in opposing reform, saying he did not “regard Fannie Mae and Freddie Mac as problems.”

Even after a multibillion dollar accounting scandal hit Freddie Mac just a month after those remarks, Frank insisted nothing was wrong. “I do not think we are facing any kind of crisis,” he said.

By 2004, Fannie had its own accounting scandal. Frank again insisted it posed no threat to the U.S. Treasury. …

As late as 2008, after the tide of losses and foreclosures washed away Fannie’s and Freddie’s remaining capital, Frank was adamant that it was all Wall Street’s fault: “The private sector got us into this mess … the government has to get us out of it.”

Of course, he had it exactly backward. We’ve already spent $148 billion of taxpayer money on the two losers. The Congressional Budget Office estimates it will ultimately cost taxpayers $389 billion to bail them out. Even that may be too little; at least one private estimate put the final toll at $1 trillion. …

We’ve spent a lot of money for Barney Frank’s education in financial reality. Today, he’s basically saying he and his party were wrong all along.

That’s a good start. But how about an apology? Or even a frank admission that his party’s indefatigable support of Fannie and Freddie — which, prodded by the Community Reinvestment Act, created and funded the massive subprime market that later collapsed — was to blame for our multitrillion dollar meltdown and the loss of millions of jobs? …

Let’s get government out of the business of encouraging homeownership, an undertaking at which it has failed miserably.

Now that the idea is dead, let’s bury it once and for all.

Why do economic achievers, like George Soros for instance, who made their splendid fortunes because they had the freedom to do so, want to close that freedom to others? Or to put it another way, why do some who have benefited spectacularly from capitalism then go and vote for socialism and promote anti-free market causes?

We don’t know the answer to that question. There are a number of possible reasons, one of them being that a person might be very good at making money and yet be quite stupid.

Here’s an example of a German magnate who believes that individuals should not be allowed to make decisions for themselves, that bureaucrats know what is best for everybody, and the state should control and distribute the resources of the nation. He speaks for hundreds of millions of Europeans, which is why many European countries – Greece is a case in point – are facing economic ruin.

The story is told in Investor’s Business Daily. We emphatically agree with the editorial opinion.

An ultrawealthy German criticizes private charity, saying it takes “the place of the state.” More disturbing than the statement itself is the sad fact that many in the Western world agree with him.

Der Spiegel reported last week that “Germany’s super-rich have rejected” an invitation to join Bill Gates and Warren Buffett’s “Giving Pledge,” in which the wealthy promise to give away a majority of their fortunes “either during their lifetime or after their death.” Wealthy Germans, Spiegel says, believe “donations shouldn’t replace duties that would be better carried out by the state.” Among them is a bitter Peter Kramer.

“I find the U.S. initiative highly problematic,” Kramer, a Hamburg-based shipping magnate, said in a Spiegel interview. “You can write donations off in your taxes to a large degree in the U.S.A. So the rich make a choice: Would I rather donate or pay taxes? The donors are taking the place of the state. That’s unacceptable.”

What is apparently acceptable to these wealthy Germans is the unlimited authority of the state and the prerogative it’s given itself to restrict people’s choices.

“It is all just a bad transfer of power from the state to billionaires,” Kramer continues. … “What legitimacy do these people have to decide where massive sums of money will flow?”

Is it legitimate for the state to demand wealth from some so it can give it to others? …

Money handed out by the state is taken from productive citizens, then distributed through the corrupt and inefficient system of politics … It’s a system based on coercion. …

Even better than private charity is private enterprise. Markets meet needs by creating wealth and growing economies. No system can match capitalism in its ability to bring prosperity to so many.

While there’s a place for charity, it’s merely a patch and should be used with great care. There’s no place, though, for forced redistribution. What’s chilling is that so many still believe there is.

In the vocabulary of the militant international Left, the word “peace” is a code word for “pro-tyranny” and “anti-freedom”.

This comes from a must-read article, titled The Peace Racket, by Bruce Bawer in City Journal (reprinted in the current issue from Summer 2007):

We need to make two points about this movement at the outset. First, it’s opposed to every value that the West stands for—liberty, free markets, individualism—and it despises America, the supreme symbol and defender of those values. Second, we’re talking not about a bunch of naive Quakers but about a movement of savvy, ambitious professionals that is already comfortably ensconced at the United Nations, in the European Union, and in many nongovernmental organizations. It is also waging an aggressive, under-the-media-radar campaign for a cabinet-level Peace Department in the United States. Sponsored by Ohio Democratic congressman Dennis Kucinich (along with more than 60 cosponsors), House Resolution 808 would authorize a Secretary of Peace to “establish a Peace Academy,” “develop a peace education curriculum” for elementary and secondary schools, and provide “grants for peace studies departments” at campuses around the country. If passed, the measure would catapult the peace studies movement into a position of extraordinary national, even international, influence.

The Peace Racket’s boundaries aren’t easy to define. It embraces scores of “peace institutes” and “peace centers” in the U.S. and Europe, plus several hundred university peace studies programs. …

At the movement’s heart … are programs whose purported emphasis is on international relations. Their founding father is a 77-year-old Norwegian professor, Johan Galtung, who established the International Peace Research Institute in 1959 and the Journal of Peace Research five years later. Invariably portrayed in the media as a charismatic and (these days) grandfatherly champion of decency, Galtung is in fact a lifelong enemy of freedom. In 1973, he thundered that “our time’s grotesque reality” was—no, not the Gulag or the Cultural Revolution, but rather the West’s “structural fascism.” He’s called America a “killer country,” accused it of “neo-fascist state terrorism,” and gleefully prophesied that it will soon follow Britain “into the graveyard of empires.” …

Fittingly, he urged Hungarians not to resist the Soviet Army in 1956, and his views on World War II suggest that he’d have preferred it if the Allies had allowed Hitler to finish off the Jews and invade Britain.

Though Galtung has opined that the annihilation of Washington, D.C., would be a fair punishment for America’s arrogant view of itself as “a model for everyone else,” he’s long held up certain countries as worthy of emulation—among them Stalin’s USSR, whose economy, he predicted in 1953, would soon overtake the West’s. He’s also a fan of Castro’s Cuba, which he praised in 1972 for “break[ing] free of imperialism’s iron grip.” …

His all-time favorite nation? China during the Cultural Revolution. Visiting his Xanadu, Galtung concluded that the Chinese loved life under Mao: after all, they were all “nice and smiling.” While “repressive in a certain liberal sense,” he wrote, Mao’s China was “endlessly liberating when seen from many other perspectives that liberal theory has never understood.” Why, China showed that “the whole theory about what an ‘open society’ is must be rewritten, probably also the theory of ‘democracy’—and it will take a long time before the West will be willing to view China as a master teacher in such subjects.”  [See our post, Mao in the White House, October 15, 2009, for glimpses of what Mao’s China was really like.]  …

Galtung’s use of the word “peace” to legitimize totalitarianism is an old Communist tradition. …

The people running today’s peace studies programs give a good idea of the movement’s illiberal, anti-American inclinations. The director of Purdue’s program is coeditor of Marxism Today, a collection of essays extolling socialism; Brandeis’s peace studies chairman has justified suicide bombings; the program director at the University of Missouri authorized a mass e-mail urging students and faculty to boycott classes to protest the Iraq invasion; and the University of Maine’s program director believes that “humans have been out of balance for centuries” and that “a unique opportunity of this new century is to engage in the creation of balance and harmony between yin and yang, masculine and feminine energies.” (Such New Age babble often mixes with the Marxism in peace studies jargon.)

What these people teach remains faithful to Galtung’s anti-Western inspiration. First and foremost, they emphasize that the world’s great evil is capitalism—because it leads to imperialism, which in turn leads to war. …

Students acquire a zero-sum picture of the world economy: if some countries and people are poor, it’s because others are rich. They’re taught that American wealth derives entirely from exploitation and that Americans, accordingly, are responsible for world poverty.

If the image of tenured professors pushing such anticapitalist nonsense on privileged suburban kids sounds like a classic case of liberals’ throwing stones at their own houses, get a load of this: America’s leading Peace Racket institution is probably the University of Notre Dame’s Joan B. Kroc Institute for International Peace Studies—endowed by and named for the widow of Ray Kroc, founder of McDonald’s, the ultimate symbol of evil corporate America. It was the Kroc Institute, by the way, that in 2004 invited Islamist scholar Tariq Ramadan to join its faculty, only to see him denied a U.S. visa on the grounds that he had defended terrorism. [He has since been granted a visa by Hillary Clinton – JB.] …

What’s alarming is that these [peace studies] students don’t plan to spend their lives on some remote mountainside in Nepal contemplating peace, harmony, and human oneness. They want to remake our world. They plan to become politicians, diplomats, bureaucrats, journalists, lawyers, teachers, activists. They’ll bring to these positions all the mangled history and misbegotten ideology that their professors have handed down to them. Their careers will advance; the Peace Racket’s influence will spread. And as it does, it will weaken freedom’s foundations.

Christianity brought a thousand years of darkness down on Europe. Historically it proved to be one of the three cruelest creeds ever to afflict poor suffering mankind (the other two being Islam and Socialism in all its ruinous forms.)

The best thing that ever happened to the human race was the Enlightenment.

Joel Mokyr, professor of Economics and History at Northwestern University, has an article in City Journal which reminds us what it did for us all.

Here are parts of it:

The most hardy and irreversible effect of the Enlightenment [is]: it made us rich. It is by now a cliché to note how much better twenty-first-century people live than even the kings of three centuries back. In thousands of large and small things, material life today is immeasurably better than ever before. …  And without sounding too cocky about how progressive history is, or too triumphalist about Western culture as the crowning achievement of human development, I would like to suggest that what generated all this prosperity was the growth of certain ideas in the century after the British Glorious Revolution of 1688. …

The writers and thinkers whose work we call the Enlightenment were a motley crew of philosophers, scientists, mathematicians, physicians, and other intellectuals. They differed on many topics, but most of them agreed that improvement of the human condition was both possible and desirable. This sounds trite to us, but it is worth pointing out that in 1700, few people on this planet had much reason to believe that their lives would ever get better. For most, life was not much less short, brutish, and nasty than it had been 1,000 years earlier. The vicious religious wars that Europe had suffered for many decades had not improved things, and though there had been a few advances — the wider availability of books, for instance … — their impact on the overall quality of life remained marginal. An average Briton born in 1700 could expect to live about 35 years, spending his days doing hard physical work and his nights in a cold, crowded, vermin-ridden home.

Against this grim backdrop, Enlightenment philosophers developed a belief in the capability of what they called “useful knowledge” to advance the state of humanity. The most influential proponent of this belief was the earlier English philosopher Francis Bacon, who had emphasized that knowledge of the physical environment was the key to material progress: “We cannot command Nature except by obeying her,” he wrote in 1620 in his New Organon. The agenda of what we would call “research and development” began to expand from the researcher’s interest alone … to include the hope that one day his knowledge could be put to good use. In 1671, one of the most eminent scientists of the age, Robert Boyle, wrote that “there is scarce any considerable physical truth, which is not, as it were, teeming with profitable inventions, and may not by human skill and industry, be made the fruitful mother of divers things useful.” The idea spread to other nations. …

To bring about the progress that they envisioned—to solve pragmatic problems of industry, agriculture, medicine, and navigation—European scientists realized that they needed to accumulate a solid body of knowledge and that this required, above all, reliable communications. They churned out encyclopedias, compendiums, dictionaries, and technical volumes—the search engines of their day—in which useful knowledge was organized, cataloged, classified, and made as available as possible. One of these tomes was Diderot’s Encyclopédie, perhaps the Enlightenment document par excellence. The age of Enlightenment was also the age of the “Republic of Science,” a transnational, informal community in which European scientists relied on an epistolary network to read, critique, translate, and sometimes plagiarize one another’s ideas and work. …

The idea of material progress through the expansion of useful knowledge — what historians today call the Baconian program — slowly took root. The Royal Society, founded in London in 1660, was explicitly based on Bacon’s ideas. Its purpose, it claimed, was “to improve the knowledge of naturall things, and all useful Arts, Manufactures, Mechanick practises, Engines, and Inventions by Experiments.” But the movement experienced a veritable spurt during the eighteenth century, when private organizations were established throughout Britain to build bridges between those who knew things and those who made things. …

More and more manufacturers sought the advice of scientists and mathematicians …

The Baconian program proved unusually successful in Britain, and hence it led the world in industrial innovation. There were many reasons for this, not the least of them England’s union with Scotland in 1707. … The Universities of Edinburgh and Glasgow were the Scottish Enlightenment’s versions of Harvard and MIT: rivals up to a point, but cooperating in generating the useful knowledge underlying new technology. They employed some of the greatest minds of the time—above all, Adam Smith. The philosopher David Hume, a friend of Smith’s, was twice denied a tenured professorship on account of his heterodox [ie atheist] beliefs. In an earlier age, he might have been in trouble with the law; but in enlightened Scotland, he lived a peaceful life as a librarian and civil servant. Another Scot and friend of Smith’s, Adam Ferguson, introduced the concept of civil society. Scotland did not just produce philosophers, either; it also exported to England many of its most talented engineers and chemists, above all James Watt. …

Optimism continued to abound about the potential of useful knowledge to improve the world. In 1780, one of the greatest figures of the Enlightenment, Benjamin Franklin, wrote in a letter that “the rapid progress true Science now makes, occasions my regretting sometimes that I was born so soon. It is impossible to imagine the Height to which may be carried, in a thousand years, the Power of Man over Matter…”

The age of Enlightenment, of course, was also the age of Newton, whose discoveries made it possible to understand the movement of heavenly bodies. …

Advances in medicine proved similarly sporadic. Enlightened physicians were passionate about progress. How could they not be? Twenty out of every 100 babies perished in their first year; many young and talented women and men died prematurely of dreaded disease; adult life was often a sequence of disfiguring and debilitating sicknesses. “I see no reason to doubt that, by taking advantage of various and continual accessions as they accrue to science, the same power will be acquired over living, as it is at present exercised over some inanimate bodies,” wrote Thomas Beddoes, a learned English medic, in 1793. And there was at least one major success story in his lifetime: Edward Jenner’s discovery of the smallpox vaccine three years later. …

The Enlightenment’s contributions to long-term economic growth were not merely scientific, moreover. Many economists … have begun to see Enlightenment economic and political ideas as central to the process. … The idea that trade normally benefits both sides led to the growth of free trade after 1815 and was central to the establishment of free-trade areas in Europe and elsewhere after 1950. That understanding grew out of the Enlightenment and the thinking of such intellectual giants as Smith and Hume.

Even more important was the Enlightenment notion of freedom of expression. In our age, we think of technological change as natural and obvious; indeed, we consider its absence a source of concern. Not so in the past: inventors were seen as disrespectful, rebelling against the existing order, threatening the stability of the regime and the Church, and jeopardizing employment. In the eighteenth century, this notion slowly began to give way to tolerance, to the belief that those with odd notions should be allowed to subject them to a market test. Many novel ideas were experimented with, especially in medicine, in which new ways to fight disease were constantly being proposed and tried … Words like “heretic” to describe innovators began to disappear. …

The Enlightenment, sadly, did not end barbarism and violence. But it did end poverty in much of the world that embraced it. Once the dust settled after the upheavals and violence of the French Revolution, Europe entered a century of economic growth (known as the pax Britannica) punctuated by a few relatively short and local wars. By 1914, countries that had experienced some kind of Enlightenment had become rich and industrialized, while those that had not, or that had resisted it successfully (such as Spain and Russia), remained behind. The “club” of rich countries formed the core of the industrialized world for most of the twentieth century. …

As unlikely as it may seem, then, a fairly small community of intellectuals in a small corner of eighteenth-century Europe changed world history. Not only did they agree on the desirability of progress; they wrote a detailed program of how to implement it and then, astoundingly, carried it through. Today, we enjoy material comforts, access to information and entertainment, better health, seeing practically all our children reach adulthood (even if we elect to have fewer of them), and a reasonable expectation of many years in leisurely and economically secure retirement. … Without the Enlightenment, they would not have happened.

As David Hume did, so also Baruch Spinoza (not mentioned by Mokyr, but hugely important to his theme) unlocked the chains of religion – Christianity, Judaism, and belief in the supernatural generally – that bound mankind in superstitious dread, for those who let them.

The ideas of freedom and tolerance that inspired, and are enshrined in, the Constitution of the United States are essentially Enlightenment ideas.

Now, countering the real progress that the Enlightenment launched, socialist “progressivism” is threatening freedom, the gift of the Enlightenment out of which all others proceed.

And even more threatening is the ideology of Islam: a darkness never penetrated by the Enlightenment.

Will we let either or both succeed in bringing back the darkness?

Millions of people are moving from tyrannical, corrupt, and (consequently) poor countries into others that are still relatively prosperous –  because they are still relatively free: the open societies, most of which are welfare states.

The majority of these immigrants do not assimilate. They remain in enclaves where the customs and in some cases the laws of their native societies continue to bind them. They do not learn the language of the host country and are not educated, so they cannot find employment. They depend on welfare handouts provided by the host country.

To meet the additional expense of immigrants’ entitlements, governments of the host countries raise taxes. The combination of rising taxation and increasing welfare-demand weakens the economy. Private enterprise is handicapped, unemployment spreads, freedom is diminished, prosperity declines. Neither the host nation nor the newcomers benefit in the long term.

Finding themselves less contented than they had hoped, immigrant groups go from disobedience to violent insurgency. (Muslim riots in France are an example.) Civil unrest threatens the general order. But for all the augmented power of such governments, they find themselves unable to enforce their laws on the immigrant settlements. It was their policy to invite the immigrants in and sustain them on welfare: it is their policy neither to repress them when they riot, terrorize, and kill, nor to repatriate them; but instead to propitiate them, granting them ever more autonomy.

Such states are under existential threat, first from the “anti-nativist” (or “anti-discriminatory”, “anti-racist”, or “pro-diversity”) ideologues who attained political power and let the immigrants in, and then from the reality on the ground when the immigrants try to establish their own culture or nationalism on the host nation’s territory. Not just their integrity but their status as nation states is slipping away.

This is most clearly seen if the immigrants come in vast numbers from a neighboring country, as do Mexicans into the United States. The borders between the countries can become so porous that they effectively dissolve. Whether as a result or a cause or both,  the very idea of borders is under attack as an ideological anachronism and a “racist”, “imperialist” offense.

The David Horowitz Freedom Center has recently published a booklet titled Arizona’s Fight, America’s Fight. It consists of two essays, by Victor Davis  Hanson and Ralph Peters respectively, that discuss the problem of illegal immigration from Mexico into the United States.

Victor Hanson Davis, in his essay Why the Arizona Law – And Why Now?, gives examples of active efforts to abolish the southern border of the US:

[Mexican] consulates now advocate the inclusion of  Mexican textbooks in predominantly Hispanic American schools, as part of Mexico City’s vow to recognize that “the Mexican nation extends beyond its borders”. (page 18)

[T]oday a Mexican  national can live in America nearly as if he were in Mexico.  The host has lost confidence in its own values. The old notion of the desirability of the melting pot has long passed. (page 26)

And Ralph Peters, in Arizona’s Neighbor From Narco-insurgency To Narco-state?, observes the same disastrous trend. He writes:

Our southern border is no longer a fixed frontier, but merely a zone of transition. Border violations carry no serious penalties, while left-wing activists and the establishment media prefer indicting our border agents over enforcing our laws.  (page 34)

How will it be to live in a world where there are no frontiers, a world without nation states?

We’re thinking about it.

Today, July 31, is the 98th anniversary of the birth of the great free-market economist, Milton Friedman. He died four years ago.

This is how he and his co-author wife Rose conclude their book Free to Choose, first published in England in 1980 [when and where they both signed a copy for me, of which I am still the proud owner – JB].

The two ideas of human freedom and economic freedom working together came to their greatest fruition in the United States. Those ideas are still very much with us. We are all of us imbued with them. They are part of the very fabric of our being. But we have been straying from them. We have been forgetting the basic truth that the greatest threat to human freedom is the concentration of power, whether in the hands of government or anyone else. We have persuaded ourselves that it is safe to grant power, provided it is for good purposes.

Fortunately, we are waking up. We are again recognizing the dangers of an overgoverned society, coming to understand that good objectives can be perverted by bad means, that reliance on the freedom of people to control their own lives in accordance with their own values is the surest way to achieve the full potential of a great society.

Fortunately, also, we are as a people still free to choose which way we should go – whether to continue along the road we have been following to ever bigger government, or to call a halt and change direction. [Emphasis mine]

That could have been written today, and needs to be remembered always.

The choice is still with us. May the American electorate use it well in November and with every election to come.

“This is an administration that could just as well have been put in place by America’s most relentless enemies,” David Solway writes at FrontPageMag. “It is headed by a president with deep roots in a neo-Marxist social movement and associational ties with a host of disreputable characters.”

Yes.

Solway sums up the Obama Devastation of America thus far:

There can be little doubt any longer that the United States is now governed by a rogue administration … We are observing an establishment that is unwilling to defend the nation’s borders from drug cartel violence and illegal immigration, forcing unread bills through Congress in the dark of night, embarking on a socialized medicine program it cannot afford and which has not worked wherever else it has been tried, plunging the nation into bankruptcy with misnamed “stimulus spending,” unsustainable entitlements and exponential debt, refusing to drill safely on land to reduce its dependence on foreign oil supplies, utterly incapable of dealing with cataclysms like the Gulf oil spill, touting an impractical, premature and ruinously exorbitant Green Energy policy, considering cap-and-trade legislation when it has become undeniably clear that Global Warming research is a profoundly unsettled and perhaps even a false science, scrubbing all reference to Islamic terror from its official documents and pursuing a foreign policy that might accurately be described as geopolitically suicidal. Quite a list, but unfortunately an accurate one.

And a damning one, though not even comprehensive.

The rogue president still has two more years to go.

Only by an unforeseeable stroke of luck could it be less.

Only by an unpreventable fit of national lunacy could it be more.

We are of the school of thought that holds taxation to be theft, though we concede that citizens must pay for the few essential functions of government, chiefly defense, law and order, the enforcing of the law of contract, the separation of infectious diseases (and locally for common facilities, of course). Adam Smith included instruction in basic literacy for the children of the poor, but we don’t see a need now, in America, for even the most elementary education to be paid for out of the common purse. (We acknowledge that this opinion is probably unpopular.)

The socialist state takes most of your earnings away from you, and when you die confiscates most of your capital worth so you cannot leave much to your children.

As the provider of the necessities of your life, the socialist state has the power to deprive you of them. Your life is in its hands, and you have no voice in its decisions, which is why socialism is called the road to serfdom.

Obama has set America on that road, and the descent is gathering pace.

This is from the Heritage Foundation’s Morning Bell today:

This year is actually the first year since 1916 that Americans do not have to pay any federal taxes when a family member dies. But thanks to the way Congress had to pass the legislation that phased out the Death Tax in 2001, it is set to go from zero percent to 55 percent at the stroke of midnight on December 31, 2010. The Death Tax is but one of many government taxes on capital and entrepreneurship, and its reinstatement will be yet another job killer from the Obama administration. It rewards estate tax lawyers, insurance companies and big businesses at the expense of small family-owned enterprises. According to a study by the American Family Business Foundation, a full repeal of the death tax, like the one [introduced by Republican Senator Jim DeMint, and] rejected by the Senate last night, would create 1.5 million jobs. Before the vote, Sen. DeMint described the tax as an “unfair, immoral double tax on property and assets that folks have already paid taxes on throughout their lives.” …

Last night’s vote to raise the Death Tax is just the beginning of the Obama administration’s historic tax hike campaign. Unless Congress acts to oppose President Obama’s agenda, everyone’s taxes on personal income, capital gains and dividends will rise….

For two generations after post-war reconstruction, Europe and America have pursued different economic models, and accordingly, moved in different economic directions. The American model was low tax, low spending and small government. It favored growth, income and vibrancy. The European model is high tax, high spending and big government. It favored fairness, equality and stability. It also featured unemployment rates double those of the United States, often hovering around 10 percent. Now that is no longer the case. Under Obama’s economic leadership, U.S. unemployment rates are surpassing Europe’s.

Last night’s vote was just the beginning of a larger choice the American people must make: do they want to continue down the Obama path of high taxes, high spending and high unemployment? Or do they still believe in American exceptionalism, in limited government and in a vibrant U.S. economy? Last night’s vote was a step in the wrong direction.