US Elections

A "Socionomic" View of the US Elections

I've refrained from commenting on the US political scene but with the elections fast approaching, it is appropriate to post a "Socionomic" view and forecast.

For a considerable time, the basic Socionomic view has been that Bush would not be re-elected. This was based on the expectation of a bear market in equities and a developing economic depression. In these circumstance, incumbents tend to get the blame and people vote for a change.

So confident was I in this scenario, that a year ago I had a bet that Hilary Clinton would win in a landslide! Needless to say, I've had to pay out on that bet (only $10, fortunately!).

The situation has been complicated by the fact that massive fiscal and monetary stimulation in the US has deferred the day of reckoning and delayed the onset of a major economic contraction. In addition, since early 2003, stock markets have staged an impressive rally, although the major markets still languish below all time highs (with the exception of Australia, which appears to be out on its own for the time being).

However, now the chickens appear to be coming home to roost. The US stock markets are now in negative territory for the year and there are signs that the real estate market in the US is starting to come off the boil. Both of these are indications of the social mood turning negative.

The other complicating factor is the so-called "War on Terror". In such times, Americans tend to have a "knee jerk" patriotism that favours the incumbent. Without this, I think there is no doubt that Bush would be electoral history.

Noting that recent polls place the candidates at level pegging, my Socionomic based forecast will be that Bush will not be reelected and that Kerry will get in. I do think it will be close, however (gee, I said that about the Australian election too!).

Another interesting Socionomic point is how polarised the US electorate is and what a divisive figure Bush is. Again, these are indications of a negative social mood and further confirmation of the bear market ahead.

Government - Becoming An Unnecessary Evil?

What Are We Paying For?

Governments are not often described as a "Protection Racket" but essentially that's what they are. In return for imposing "law and order" and defending the realm against outside agression, we allow the government to extort money from us in the form of taxes etc. The exact form of the government may vary and regimes can range from the benign (e.g. the original US Republic) to the outright tyrannical, with most somewhere in between.

What happens, however, when governments don't fulfill their end of the bargain? I raise this issue because of two items I saw over the weekend.

Firstly, in the UK there has been renewed outrage over the absurd situation where citizens find themselves being prosecuted as result of defending themselves against criminals. The "Daily Telegraph" (see here) comments:

"There is no more fundamental right than that of individuals to protect themselves, their families and their homes from criminals who break in and attempt to steal their property. It is the most basic one which government exists to protect - and when it fails to protect it, government neglects its most elementary duty."

In the UK, the crime situation has deteriorated in recent years largely as a consequence of the law seeming to be more concerned with the "rights" of criminals rather than ordinary ctizens combined with ineffectual policing (which is linked to the first point).

Secondly, an opinion piece in this weekend's "Australian Financial Review" revisits the topic of crumbling basic infrastructure. I've commented before how Sydney is facing not only a water shortage but also possible problems with electricity.

Items such as these raise the question "What are paying for?" It's a topic that is considered at length in "The Sovereign Individual", a book I have mentioned previously. In essence, if governments cannot or will not meet the basic requirements of their citizens, then increasingly they will lose support and legitimacy in the eyes of their citizens. At it's extreme, this leads to the phenomenon of "failed states" and other internal strife.

Stormy times lie ahead and governments would do well to remember their end of the bargain.

The Day The Factories Stopped

Car Workers Bear the Brunt of a Global Reality for Many German Workers

The headline sounds like something from "Atlas Shrugged" and in many ways it is. In Germany, General Motors (which operates as Opel in Germany) is to cut 10,000 jobs, nearly a third of its workforce. In the towns affected, this is a "man made disaster" (see here for the article in this week's "Economist" - the World's greatest weekly periodical, in my not so humble opinion!).

Needless to say, the workers involved are not happy and there has been strike action. However, General Motors has little choice. Incredible though it may seem, GM (and Ford) face a fight for survival. Neither company actually makes any money from car making these days. They both rely on profits from their finance arms to stay afloat. They also face huge unfunded pension liabilities (sorry, I know I do talk about this a lot!) and other promised employee benefits (primarily healthcare).

Germany itself is facing a crunch because, basically, it's industries are no longer competitive. High labour costs and the burdens of a very generous welfare state have finally proved too much. Add to that the additional burdens of the cost of re-unification (in hindsight, a financial catastrophe, although there were plenty of warnings at the time - ignored, of course, by politicians anxious to secure their "place in history") and the EU (Germany has always been a net contributor to the EU budget - a kind of disguised war reparations to the French!).

In addition to these factors, the adoption of the single European currency, has made things worse. Interestingly, this was anticipated as far back as 1996 by Stephen Roach at Morgan Stanley. His argument was that if EMU went ahead it would be very deflationary for the core EMU countries (primarily Germany and France). This is certainly how it has turned out for Germany.

Back to the main story. No doubt there will be a clamour for protection of jobs and further vilification of "capitalism" (particularly the global variety). The real "man made disaster", however, is the welfare state and the illusion that you can get "something for nothing". German industry has been crippled with unsustainable costs and regulation. The post-war German "economic miracle" is long over and the real miracle is that the economy hasn't collapsed before now.

What's happening in Germany is merely a preview of what will happen across the Western World and as the old order collapses, things are likely to get ugly. I'll finish this with a quote from Stephen Roach's article (remember, this was written back in 1996).

"Our guess is that EMU, far from creating a sexless, tasteless, supranational Europe, would give us excitement aplenty. It would be a Europe where the balance of power in parliaments is held by the populist parties of economic nonsense and the balance of power in the streets of riot-torn capitals is held by jobless, crypto-fascist yobs."

The Evils of Capitalism....Part 57!

Why "Capitalism" Is To Blame For .... Everything!

Despite the enormous benefits it has brought mankind, capitalism rarely gets a good press and is rarely defended in an enthusiastic fashion. In contrast, it's critics are prominent and there seems to be a never ending stream of articles blaming capitalism for pretty much everything.

An article in today's "Sydney Morning Herald" caught my attention (see here) - "There's No Time For Love and Intimacy in Our Market Driven Lives". This pathetic bleat (originally from the "Guardian" in the UK) whines..

"What we have overlooked is how the pervasive values of market capitalism are corrupting not just the public sphere - our politics and culture - but also the private sphere of our emotional lives.

The anti-globalisation movement in the '90s rooted its analysis in how the nation state was being undermined.

What it needs to do now is to bolt onto such thinking the way our personal emotions are being distorted to fit a culture in which the values of the market are paramount."

The reference to the anti-globalisation movement kind of gives away the writer's agenda, I think. However, let's think about this for a moment.

Assume for a moment that the problem is actually real, rather than just a reflection of the writer's own inadequacies and failings. Could there be other reasons? For example, not too much capitalism but too little? The ever increasing tax burden imposed by the bloated welfare state that means people have to work harder to get ahead, for example?

Or, could it be the moral vacuum that most people find themselves in as a result of the "progressive" social revolutions of the last 50 years that did away with traditional values and standards but failed to replace them with anything? Might feminism have something to do with it (gasp!!!)?

No, of course not. How stupid of me! It's obviously capitalism that's to blame as it's to blame for absolutely everything you might care to mention! How dare I suggest that people might somehow be responsible for their own lives!

The disease of "Victimhood" is widespread in our society, particularly on the Left. In fact, promoting "Victimhood" is the stock in trade of the Left and a particularly evil thing as it results in disempowering people.

Another example cropped up, amazingly, in the weekend edition of the "Australian Financial Review". An article entitled "Greed: Capitalism's Necessary Evil" proceded to paint a picture of extreme greed run riot and this being an inevitable and necessary feature of a capitalist system. The article was stuffed full of questionable assumptions, quotes taken out of context and propaganda disguised as research. There was hardly a single fact in the article and those were used in a very disingenuous fashion.

It needs to be said loudly and often that free market capitalism, even in the limited form that exists today, has done more to improve the lot of mankind than any other system of social organisation. It's also the system that is the best guardian of the liberty of the individual. Nothing else has even come close.

Will The Lights Go Out?

Creaking Infrastructure

I was intrigued by the following article (see here) in today's "Sydney Morning Herald" - "Daily Blackouts Ahead - Liberals Claim".

"Sydney may soon be experiencing almost daily blackouts because funds have been diverted to pay dividends rather than maintaining the electricity network, the NSW Opposition claimed yesterday.

About 30,000 homes and businesses in the inner north-west were without electricity on Wednesday night, after a substation exploded in Gladesville."

Leaving aside the usual inter-party point scoring, it brings into focus an issue that we may well be seeing more of in the years to come. I certainly recall blackouts earlier this year in the CBD when a couple of blocks were without power for several days and we've seen major blackouts in both the USA and Europe over the past year.

What's going on? It seems that the basic infrastructure has suffered underinvestment going back decades. This doesn't just affect Australia but it seems to be an issue throughout the Western World. It's often referred to as "Private Affluence and Public Squalor".

The usual response to this issue, particularly from the left, is that we need to spend more on public infrastructure. Perhaps we do. However, before throwing more money at the problem, I think it's worth asking why we the infrastructure hasn't been properly maintained. After all, taxes are at record levels and have increased relentlessly over the last 50 years.

Readers will not be surprised when I suggest that the reason is that public spending is inherently inefficient (so we haven't been getting value for money) and that spending on infrastructure has taken a back seat to short term vote buying. Put bluntly, there's no payoff for a politician by acting prudently and making a long term investment when they face reelection now. Long term issues are put off and only tackled when they become an immediate crisis.

In Sydney, we're seeing similar problems with the rail network and with the water supply (this latter problem being compounded by the environmental lobby).

It's interesting as well, that the USA faces similar problems, even though the power companies are in the private sector. The problem here is that regulation is so stringent that the poor returns on capital have resulted in similar underinvestment. Regulation in many instances becomes a "de-facto" form of public ownership.

"Socionomics" would also add that these signs of emerging stress are to be expected at the tail-end of a fifth wave and the start of a bear market. Fifth waves are relatively weak in terms of the real underlying economic fundamentals and the prevailing optimism leads to the deferral of action on problems such as this. Problems are ignored until reality intervenes,

The Wealth of Australia

Australian Household Wealth Tops A$5 Trillion

The fruits of Australia's long economic boom were illustrated in some figures published today by the Australian Bureau of Statistics:

"Private sector wealth was estimated to be $5013.3 billion at the end of June 2004, according to figures prepared by the federal Treasury and published by the Bureau of Statistics yesterday.

The measure of wealth covers a variety of assets including cash, shares, bonds, houses, factories and other business assets. Housing makes up more than 60 per cent of Australia's net wealth.

The Treasury figures showed Australia's private debt at $384 billion or $19,140 per person, up 10 per cent in the past year."

The net wealth figure works out at around $250,000 per person, compared with $126,000 per person in mid-1997. Before inflation, this represents an increase of 10.3% pa which is a rapid rate by any standards.

"The average house price has more than doubled since 1996 and the share price index has almost doubled in the same period. The benchmark S&P/ASX 200 rose to another record high yesterday (Oct 13), closing up 7.8 points at 3725.2"

Couple of things strike me about these figures. Firstly, the doubling of wealth has come largely from the increase in asset values of property and shares. Housing makes up more than 60% of net wealth so these figures are vulnerable to any significant setback in the property market.

Secondly, I'm a little surprised by the debt figures. They don't seem that large to me especially given a lot of the concern recently about the build up in household debt in recent years.

"Economists have expressed concern about the growth in household debt, which has risen to about 150 per cent of annual household income. Interest payments as a proportion of income are also at record levels, despite relatively low interest rates. Repayments are higher than when rates reached 17 per cent in the 1980s."

Australia has a high proportion of home owners (about 70%) so the picture that I see is a huge proportion of people already own their house free and clear, while there is a smaller proportion (recent home buyers) who are carrying a heavy debt load. On balance, we don't appear to be looking at a catastrophic credit bubble. This is a little contrary to what I had previously thought, so I will look into these figures further.

Given these figures, the recent election result should have been no great surprise and not because of the "interest rate scare". The fact is, people would be feeling wealthy and in those circumstances the incumbent is always favoured.

Going forward, I think we are about to enter choppy waters. The housing market appears to have peaked and I think the stock market is not far behind.

The stock market made a new high yesterday before retreating somewhat today. I'm looking for a significant high somewhere around here. We're likely to see a pullback and then one more push up, possibly to a new high. After that, the market is likely to be in a bear market phase for a significant period (5-10 years). Basis for this forecast is the Elliott Wave Theory from the folks over at Elliott Wave International (www.elliottwave.com). In Australia we appear to completing a 5th wave up which started in the early 1990's. The US market is already in the early stages of a protracted bear market and this is likely to start gathering force on the downside soon.

Just to round off today's post, this from the "Daily Reckoning" on the US.

"Imagine a place where you could spend far more than you earned for years without consequence," writes Gary Duncan in the Times of London. "Imagine a place where you could pay your way by writing cheques that nobody would bother to cash. Welcome to America, today."

Americans have never had it so good. But Nature has her ways of keeping things in balance. Like fat little lemmings rushing into the sea, Americans seem to have an urge for mass financial suicide; they couldn't wait to put themselves in deep water.

"Over the past decade or more," Duncan continues, "the United States has been living far beyond even the vast means commanded by the world's largest economy. America's households have spent far more than they earn, borrowing extravagantly against the rising value of their homes and other assets. The U.S. government has been no less profligate, dramatically increasing spending while making hefty cuts in taxes. "

In the last five years, for every dollar Americans earned, they've spent $1.20. In barely a decade, the United States became the world's biggest debtor, with the percentage of U.S. government debt in foreign hands rising from 20% to nearly half. Foreign lending - the kindness of strangers - is what keeps the U.S. economy going.

I (and a lot of other bearish commentators) have been saying for quite a while that this cannot continue. And yet it has! However, I think it would be highly imprudent to assume it will continue and my guess is that we are close to a major crash in the US. I'll save further comment on that for a separate post.

In the meantime, Australia can enjoy the sunshine and I think we're in relatively good shape to weather the storm ahead.

The UK Pensions Crisis

The Truth About the Bankruptcy of the Welfare State is Beginning to Sink In

In the UK the Turner report on pensions is due out and will reveal a GBP 57bn shortfall in the amount that is deemed necessary for adequate provision in retirement (see here).

"The commission has identified the "unpalatable choices" of higher taxes, a big increase in private savings or later retirement needed to plug the gap. "

Higher taxes have been ruled out, at least for the time being. So the government seems to be pushing the idea of raising retirement ages. Whichever way you look at it, the benefits promised simply won't be there.

The UK is far from having the biggest problems over pensions. The major European states have a massive problem, as does the USA. I guess it's encouraging that this issue is being discussed now, rather than in 10 years time when the bills really start to come in. However, the message for the private citizen is pretty clear. You can't rely on the government and you need to start making provision for your retirement right now.

The Virtue of Selfishness

Why Self-Interest is Not Only Rational But Moral and Ethical

There has been an enormous amount of humbug in various letters, blogs and articles since the Australian election along the lines of how terrible it is that the majority of Australian voters care more about dollars in their pockets rather than the Iraq war, refugees, the environment etc. The writers somehow think they are claiming the moral high ground and the rest of us are a bunch of greedy bastards. Well, that's not the case and those making these claims are either guilty of double standards or, even worse, are morally depraved.

Let's look at these two alternatives. Firstly, there is the question do these people think that the policies they promote are in their own interests? If so, then why are they allowed to act in their own interests and others are not? They may disagree as to the merits of the different policies but to claim a right for oneself and disallow that right to others is morally wrong and nothing more than outright oppression.

The alternative is that these people are not acting in their own interests but rather altruistically and for some "greater good". This is even worse than the first case! Why? Because in this case the act is in effect a negation of life and a vote for death. The logical outcome of such altruism is suicide and death. Why? Because if someone continually sacrifices themselves and does not act to support their own life then death is the inevitable consequence.

This is disgusting and morally depraved. Usually such people have little or no self-esteem, hate themselves and, as a consequence, hate everyone else. Ayn Rand viewed altruism as her worst enemy for this reason.

It's worth reviewing a couple of the fundamental tenets upon which Rand based her philosophy. In essence, these are:

1. Each individual has the right to exist and each life is it's own justification; and
2. Each individual has the right to pursue their own happiness and highest good, without interference from others.

Note that in pursuing their own interest, the individual does not have the right to infringe on others.

This approach is first and foremost "pro-life". Everything that follows (such as the conclusion that free market capitalism is the best, and only moral, system for society) is a consequence of this.

Australian Election Result - A Socionomic Perspective

Observations From The Remarkable Liberal Win

Well, in the end it wasn't even close. The Liberal Coalition was returned to power in a stunning victory that will see them with an increased majority and greater freedom of action as a result of gaining control of the Senate. As readers will know, I tipped a narrow Liberal win, based on the predictive model of "Socionomics" and the social mood. With the Australian stock market having made record highs in recent weeks and the housing market holding up for the time being, the social mood was clearly behind the incumbent party. There simply wasn't any great reason for most people to vote for a change. Circumstances could well be different in 3 years time, however, as a global bear market starts to gather force.

Labour, in hindsight, ran a singularly inept campaign. I suppose one should acknowledge Latham's honesty, but from a political point of view it was very dumb. The loss of two Labour seats in Tasmania, pretty much as a result of Labour's pandering to the Green vote, shows the price of failng to understand what the core issue's really were. That is, to quote Bill Clinton's adviser James Carville, "It's the Economy, Stupid!".

From a more positive point of view, the electorate voted for their "hip pockets" and rejected the collectivist policies on offer from Labour. From a Randian point of view, this is very encouraging. There has been a lot of hand wringing and anguish from left-wing commentators and blogs about how "selfish" the Australian electorate has become. This is a GREAT thing and indicates that morality (in the Randian sense) is improving. Australians have not suddenly become a bunch of grasping, greedy bastards! However, they are looking after their own interests first and focusing on life and prosperity, rather than trying to "save the world". This is a good thing, contrary to what those pushing the altruistic death-cult line would have us believe.

Some straws in the wind, however. Despite what the stunning electoral victory would suggest, opinion is becoming more polarised. The Greens ( a "mystical death-cult" in Randian terms!) gained ground to become the third biggest party. This is a very disturbing development as their policies are very much anti-prosperity and anti-freedom. Unfortunately, they are not going to go away and as the social mood becomes more divided in the years ahead they may gain ground.

Another example is the emergence of the religious based "Family First" party on the right. Again, expect to see their influence grow.

The Democrats have been pretty much wiped out. This "third force" which emerged in the 1970s has been in dis-array in recent years and this election has shown how irrelevant they have become to the electorate. Always on the left of the political sprectrum, they failed to develop any appeal to the mainstream and they have been outflanked on the left by the more radical Greens.

So where does this leave John Howard? Undoubtedly this will be seen as a personal triumph, securing his "place in history". This, more than anything, seems to have obsessed the man in recent times. Now that this has been achieved, perhaps he will focus more on what kind of legacy he leaves. As commented, Howard has been a very divisive figure. A master politician, he has perfected the art of "wedge politics". If he is wise, he will seek to truly govern for the broad electorate and tone down some of the more questionable aspects of his administration. Doing this will mean there is more of a chance of him being remembered as a statesman, rather than just a very clever politician.

Talking with a friend last night, I said that the worst result after a big Labour win would be a big Liberal victory! I hope I'm proved wrong. In his victory speech, Howard talked about "Australia being on the threshold of a new era of great achievement and could do anything it wanted." There are many challenges ahead (aren't there always!!) but in many ways Australia is better placed than most other countries. Public finances are in better shape than elsewhere. The country is well placed to benefit from the emergence of China on the world stage. The country is blessed with an abundance of resources. Finally, there seems to be emerging a new spirit of enterprise.

The challenges, of course, will be the storms ahead in the world economy and coping with the build up of credit and debt in the economy. As well, the cancer of the collectivist mindset still lurks. However, the election result seems to indicate that it doesn't have the same hold in Australia as elsewhere. When I compare the UK and Australia, for example, Australia seems much better placed. The UK, in contrast, seems to be slipping into collectivist lunacy.

Australian Election - At the Polling Booth!

Blogging From The Frontline

Today in Australia (Saturday 9 October) is the Federal election. Somewhat against my better judgment(!!), I once again did duty at my local polling station, handing out leaflets for the Liberal party. Now, it's a fascinating experience to watch people as they come into vote and, of course, you get a first hand snapshot of public opinion. It's actually a good opportunity to chat with people of different views as well. In our electorate, at least, the rival party workers are pretty good natured and generally we have a chat as we are waiting to press our "how to vote" leaflets into the hands of the local citizens!

There was one unpleasant incident, however. A man came up to the entrance and when the Labour party worker offered a leaflet he very pointedly refused it and proceded to comment that Labour's policies would cost him another $4,000 a year in school fees for his young daughter. As a result, he was very definitely not going to be voting Labour. The Labour party worker somewhat rashly made the comment that he was lucky to have the $4,000 to spend on school fees. This prompted a very angry tirade from the man concerned!

Now, it was very interesting to observe this and the implication of the comment that the man was lucky to have the money. When I heard that, it certainly struck a raw nerve with me and obviously it did with the person involved! I wondered if the lady who made the comment really understood the implication of what she had said. That is, the implication was that anyone who had money was somehow "lucky" and that they didn't deserve to have it. They might even have come by the money dishonestly! An example of the "lack thinking" that is so common and which is endemic among people who hold "collectivist" beliefs.

The other thing that was pretty clear was just how much the Prime Minister, John Howard, is utterly despised by a wide range of people. For myself, I can't stand the man but "held my nose" and voted Liberal because the alternative is so much worse. I imagine there are quite a few people like me. Probably the best result tonight would be a Liberal win but Howard loses his seat!

What's the result going to be? I'll stick with my earlier forecast of a Liberal win. As the election campaign has progressed, my sense is that the core Liberal vote has firmed up and people will vote for their "hip pocket". The issues that so excite the left wing commentariat ("Truth in Government", the Iraq War etc) simply aren't what matters most to people. However, I think it will be very close.

The Costs of Regulation and Bureaucratic Interference

More Burdens on UK Business

The City Comment section of the "Daily Telegraph" (see here) talks about the latest European Union directives from Brussels and also recent actions of the UK Financial Services Authority ("Brussels Has a Mania For Rules That Creates a Climate of Fear").

Firstly, the EU Gender Discrimination Directive. One of the main lunacies in the original draft was the demand that insurance premiums must be the same for men and women. Now, the reason why rates differ between men and women is that the objective, statistical data shows that men and women have different mortality and sickness rates and also different experience with things like motor insurance (generally, women are better risks and so get better rates). This is objective reality. The bureaucrats, however, seem to think they can defy reality! They can't however, and the end result of fantasy-based directives is the crippling and ultimate destruction of business and prosperity. The directive has been modified but yet another layer of compliance and red tape has been added.

The second part of the article talks about the Insurance Mediation Directive. The problem, however, is that the Directive is so poorly worded that it's almost impossible to comply with.

"Comply with what, exactly? The directive is riddled with inconsistencies: the travel agent can sell you insurance against cancelling your holiday, but not an annual policy. The nice salesman from Dixons can sell you an extended warranty, because that's not insurance, is it?"

As a result of the uncertainty over the Directive, companies are forced to be extremely cautious about what they do.

In "Atlas Shrugged" there is a section where Hank Rearden points out that it's impossible to comply with a particular Directive. Whatever any businessman does, he will be "breaking the law". The sinister bureaucrat he is dealing with points out that is exactly the situation they want! Under those circumstances, business is completely at the mercy of the bureaucrats and their whims.

Whether or not this is the explicit aim, the end result is the same. The crippling of business and the consequent impact on prosperity. It's no coincidence that the core European economies are struggling, as this comment from a recent survey in the "Economist" makes clear:

"In Germany, France and Italy....unemployment is now hovering around 10% and public finances are in a mess. Germany in particular has had a grim few years: since 1996, it has averaged growth of just 1.3% a year. In fact, western Europe's economic miracle ended a long time ago. Average income levels, having risen to 70% of America's in the early 1970s, have been stuck there ever since and are now declining in relative terms."

While we are on the topic of European lunacy, I was stunned by this article today from the "Sydney Morning Herald" - "Sweden debates hitting men with domestic violence tax" (see here). This is beyond mere bureaucratic folly. This is pure evil. It reminds me of the collective responsibility doctrine usually associated with Nazi reprisals against civilians. Who will be next?

Now, I'm not making light of the issue of domestic violence. However, protection of women in the home is no different from the protection of all citizens from violence against their person. This is another example of how radical feminism has become simply another part of the general collectivist assault on individual liberty and prosperity.

The Nonsense of "Social Justice"

Why Australia Should Avoid the UN and International Treaties

A piece of blatant pleading of self-interest (at the expense of taxpayers) appeared in today's "Sydney Morning Herald" (see here). In an article entitled "University Fees are a Social Injustice", three academics complain that by charging students for access to tertiary education, Australia is in violation of the United Nations International Covenant on Economic, Social and Cultural Rights (ICESCR), which apparently obliges Australia to make higher education "equally accessible to all, on the basis of capacity, by every appropriate means, and in particular by the progressive introduction of free education."

The authors comment that "That means that everyone who is capable of completing higher education is entitled to receive it in an increasingly free system."

The unasked question, of course, is "At whose expense?" Ayn Rand spelt out very clearly why the idea of a "right" to such things as "free" education is nonsense. In her 1963 essay "Man's Rights" she comments:

"Jobs, food, clothing, recreation(!), homes, medical care, education etc, do not grow in nature. These are man-made values - goods and services produced by men. Who is to provide them?

If some men are entitled by right to the products of the work of others, it means that those others are deprived of rights and condemned to slave labour.

Any alleged "right" of one man, which necessitates the violation of the rights of another, is not and cannot be a right."

Of course, if our learned academics wish to provide their dubious services free of charge, I guess that's another matter! Somehow, I don't think that's likely to happen.

I note that Australia apparently signed this treaty in 1976, presumably as part of the Whitlam madness. While we are on the topic of the UN, I think it's worth pointing out that as very few of the member governments have any legitimacy in Randian terms, the whole organization is a complete sham and Australia would be well off out of the whole thing.

As far as Rand was concerned, the right of "the self determination of nations" applies only to free societies or to societies seeking to establish freedom. It certainly does not apply to dictatorships, which are no better than a criminal gang. The majority of the members of the UN are very definitely not free societies so the idea that a nation such as Australia should consider itself bound by treaties or conventions drawn up by such an organisation is absurd.

SpaceShipOne

The Triumph of Reason!

Ayn Rand would have been ecstatic at the success of SpaceShipOne. Not only is it a demonstration of Man's triumph over his environment and a symbol of progress, but even better it is a project carried out by free enterprise and not government. Although Rand saw the Appollo space program as a triumph for Mankind, she was never really happy that this was a government programme.

So, the torch of progress and exploration has been passed to the private sector. This is a good thing. Long time readers of Robert Prechter will be aware of his prediction, based on the Science of Socionomics, that the public space programmmes will be shut down in the coming years as the global bear market gathers force. As public finances come under strain, trips to the stars will be seen as an unaffordable luxury. In the turbulent times ahead, at least the beacon of progress will still be carried forward by those best able to do so. The Men of Reason!

Labour - Definitely The Worst of Two Evils

The True Evil Behind Collectivist Parties

As readers will be aware, I don't have a lot of time for any of the main Australian political parties. However, an article in today's "Sydney Morning Herald" reminded me of why the Liberal Coalition, for all their faults, will get my vote as the party most likely to protect our individual rights and freedom.

Paul Sheehan describes in an article "Spreading the Word of Intolerance" (see here) an action (Islamic Council of Australia vs Catch the Fire Ministries) brought under Victoria's Racial and Religious Tolerance Act. In a nutshell, this Act is a device to assist the spread of "Political Correctness" (as defined, of course, by the collectivist bureaucrats of the Labour Party), backed up by the full coercive weapons of the state. Read the article, it's frightening. It's something that could have come straight from "Atlas Shrugged". Needless to say, if elected, Labour wants to introduce similar legislation at the Federal Level.

It will be interesting to see if a countercase is ever permitted, asking the ICA why they should not be prosecuted for promoting an ideology that explicitly advocates the use of force to spread its doctrine.

This sort of thing is a reminder of the key struggle that we are fighting, that is for the rights and liberty of the individual (EVERY individual, regardless of race, sex, creed etc etc ) versus the collectivist ideology. Regardless of how they might promote themselves and regardless of the modern packaging and slick PR they might adopt, left-wing parties are profoundly anti-freedom and anti-prosperity (even anti-life, Rand would argue). Their fundamental creed is that they know what's best for you and you'd better do it for "the greater good" or you'll be in trouble!

Of course, we need to remain vigilant at the other end of the political spectrum as well. Fascism and Communism are simply different aspects of the same "collectivist" evil. I hate to say it, but a huge danger the world faces today is the risk of Fascism in the USA. Don't take that to mean a vote of support for Kerry! However, the Bush administration has taken some profoundly disturbing steps to undermine the USA's system of checks and balances and Congress, in particular, needs to fulfill the role it is meant to play.