Arguably the best known and most far-reaching was the Mahalanobis model which attempted to encapsulate and define the most efficient flow of production for the multicultural subcontinent.

As part of its implementation, India nationalized the commanding heights, industries that policy makers felt were too critical to be left to market forces.

And like their contemporary Soviet counterparts, the model assumed too much, overlooked many important details and ultimately failed to catapult the country into prosperity.

Despite an abundance of natural resources and relatively cheap labor, growth stagnated for forty years, averaging a mere 3.5% a year, leading to a situation sarcastically dubbed the "Hindu rate of growth."

Yet their dismal experience has not stopped other Western countries from partaking in similar endeavors. However, before discussing Western policies, another story should be briefly investigated.

The future cannot do without economic logic

Several mainstream articles have discussed what role equations and models from financial engineers such as David Li and Michael Osinski played in the current disorder.

Li created a mathematical formula modeling risk that was used by nearly every financial firm and ratings agency. Osinski wrote the software that turned mortgages into CMOs (similar to CDOs), software that was used by many large banks and mortgage service providers.

Both were at the heart of a world that no longer exists, a world that incorrectly predicted human behavior.

It should be noted that there is nothing inherently wrong with attempting to mathematically model human behavior. However, what they and others like Prasanta Mahalanobis (namesake of the model) attempted to do was quantify human action using inherently incomplete equations u2014 using false assumptions to fill in for a continually changing series of individual preferences (or in their case, risks/demand).

And one problem overlooked by these mainstream exposés is that we, humans, are analog beings with subjective, heterogeneous preferences that continually change. And the quantitative models developed and deployed by financial firms to spread and mitigate risk did not take into account the perverse incentives institutions like the Federal Reserve fed market participants.

In addition, everything that policy makers — at every level — are doing is more of the same foolhardy economic planning that leads to lower productivity and more financial strain. But, before lamenting the details of any recent political escapades, another aspect should be brought into the fold.

Up and atom

In the spring issue of h+ magazine ("Is the Future Cancelled?"), there are several articles, including an interview with scientific luminary Vernor Vinge, that discuss the current economic environment and the long-term impact the recession will have on technological and scientific development.

And while each attempts to explain the observable phenomenon we are witnessing, all fail to recognize the same culprit: central planning and spurious assumptions.

While Ben Geortzel’s piece does discuss the shortcomings of certain financial models, none of the others say anything about the deleterious role government economic models played in the current crisis. Nor do they identify the enabling antagonists in implementing them: government-managed institutions.

Fannie Mae and Freddie Mac underwrote half of all residential mortgages during the most recent boom. The Federal Reserve released the spigots of hundreds of billions of "hot" money which was leveraged upon through fractional-reserve banking. The FDIC institutionalized moral hazard by socializing the risks of reckless bankers at the expense of taxpayers. And various executive agencies transferred tens of billions of taxpayer funds to pet projects managed by special interest groups.

In pursuing their ill-advised mandates, each of these parties justified their action through various unsustainable economic growth models. Actions that have created an imbalanced economy which is currently trying to purge itself of malinvestments.

Yet according to Vernor Vinge, technological progress may continue even in the absence of a healthy economy, because "it only takes a few companies to keep up with Moore’s Law and thus make the breakthroughs that will bring this strong AI [Artificial Intelligence] to fruition."

Cause and effect

Worldwide, more than 330,000 tech workers have been laid off since August. Venture capital in the US has declined dramatically, from $35.5 billion in 2007 to $27.9 billion in 2008 (—21%); and first quarter VC just hit a twelve year low. In fact, in the past 12 months only one venture-backed IPO took place (Rackspace). And in a move that arguably punishes future investment, President Obama is raising the capital gains tax to 20% (in contrast, China has a 0% rate on capital gains).

While there is no right or wrong number of employees that should be working in a given industry (sometimes fewer is more effective), the software development industry is highly dependent on human capital for developing new code. And both the telecommunication and semiconductor industries are not only capital intensive, with equipment costs in the billions, but also continually need creative engineers.

Thus from the perspective that technological growth will persist irrespective of economic conditions, it is dubious that Vinge’s assertion will hold true in the presence of a protracted recession.

Yet with all of this gloom there is still one bright area that historically has helped tax producers and innovators keep their head above water.

The benefits of deflation

Throughout the 1990s and 2000s consumer prices typically increased 3—5% annually due to inflation pressures. However globalization as a whole, vis–vis trade liberalizations, gains in workplace productivity, and technological progress masked the inflationary effects wrought by central banks.

As a consequence, the retail costs of all technological gadgetry typically decreased while simultaneously functionality and performance were upgraded at no additional cost. And then some.

For example, most modern smartphones are more powerful than desktop PCs from a decade ago, yet they cost a fraction of the price.

Take for instance the 3G iPhone released last year. According to Simon Jeffrey, president of Sega (America), it is as powerful as the Dreamcast console from 10 years ago. Furthermore, silicon-for-silicon it is also more powerful than the original iMac released in 1998, yet adjusted for inflation costs 1/8th the price.

And as seen in this chart, this deflationary phenomenon was not merely isolated to a single company in Cupertino:

Computer

Apple II

The original IBM PC

Original iMac

Dell Studio XPS

CPU

MOS @ 1 MHz

Intel 8088 @ 4.77 MHz

PowerPC G3 @ 233 MHz

Core i7 @ 2.66 GHZ

GPU

None

None

ATI Rage w/ 2MB

ATI 4670 w/ 512 MB

Hard drive

None, audio cassette

40 KB & Floppy Disk

4 GB

750 GB

Memory

4 KB

16 KB

32 MB

6 GB

Network

None

None

Ethernet, 56K modem

WiFi, Bluetooth, Ethernet

Monitor

None

None

15"

24"

Nominal cost

$1298 in 1977

$1565 in 1981

$1299 in 1998

$1549 in 2009

Adjusted for inflation

$4599 in 2009

$3653 in 2009

$1691 in 2009

Current MSRP

This is not an endorsement of products from Apple, Dell, Intel or any other firm. Rather, this serves as an illustration to highlight a fallacy in current orthodoxy.

Malignant deflationary spiral

One Keynesian doomsday scenario forewarned by technocrats of all political stripes is an environment in which customers avoid products whose prices continually fall. In theory, customers would delay purchases indefinitely, leading to a downward spiral: a decrease in prices leads to lower production, which leads to lower wages and lower demand, which leads to lower prices. Ad infinitum.

However, as an economy grows and becomes more efficient, it should ultimately cost less to produce the same units of goods and service. Price deflation caused by scientific progress and economic efficiencies (e.g., mass production, automation) is actually a beneficial side effect and should be embraced.

Thus, in practice, even with the expected knowledge that their purchased products will become outdated and cheaper within a few months, customers did not shun but rather flocked to computer retailers rain or shine. And the numbers reflect this.

A scant 40,000 PCs were sold in 1976. By 1984, the number had risen to 2 million. At the close of 1986 this number had tripled to 6 million shipments worldwide. By 1990, PC sales had reached 16 million a year. By 1994 worldwide sales had more than doubled to 36 million. At the peak of the dotcom bubble more than 135 million PCs were sold each year. Following the 2001 recession, growth resumed upward, hitting 170 million by 2004.

And while there will be a big dip this year, in 2008 more than 295 million computers were sold worldwide. This figure does not include smartphones, which in 2008, more than 139 million devices were sold globally; up from 37 million in 2005.

All told, more than 1 billion computers were actively in use at the end of 2008 — and that number is expected to double by 2014—2015.

In contrast to Keynesian theory, despite the fact that dozens of large multinational companies compete in an environment where prices have persistently decreased throughout the last three decades, this has not led to lower production or lower wages. In fact, the opposite has occurred.

In fact on top of competitive pressures, between 2004 and 2008 prices of commodities commonly used in PC components more than doubled. Some such as copper and silicon tripled. Yet PC manufactures across the globe not only cut product costs and upgraded machines, but profited handsomely. And without trillion dollar subsidies or bailouts!

However these deflationary benefits may be thwarted in the coming years as government policies worldwide redistribute capital.

What impact will this have on the funding of semiconductor foundries, clean rooms, lithographic lasers, die-testing equipment and automated manufacturing as a whole? What happens when productive capital is diverted to the government bond market to fund deficits?

Not learning from past mistakes

While it is difficult to predict the exact long-term consequences chairman Ben Bernanke’s expansion of the Fed balance sheet will have on consumer prices we can a priori state that all of the bailouts and stimuli will be unable to achieve their stated goals and will actually hamper growth.

We know this because free markets are the only method to accurately and efficiently react to prices and allocate resources accordingly. Politicized committees cannot.

In addition, we know that taxpayer funds will be channeled through an inefficient, unmotivated bureaucracy that is connected to kleptocratic interest groups. An apparatus that historically over-promises and under-delivers and one that is not always relegated to imbibing and then lambasting the boardrooms of Wall Street. For instance:

• In the 1990s, more than $200 billion of taxpayer funds was funneled to telecoms under a Congressional-mandated plan to build and deploy broadband internet access across the country. By all objective measures it was a failure.
• Since the end of the Cold War, the US has borrowed and spent more than $7 trillion on defense appropriations. A stimulus to those receiving contracts yet with little contribution to humanity, let alone the average consumer.
• And the Bush administration itself spent $900 billion stimulating (occupying) two different countries resulting in little more than the creation of refugees and resentment.

So to clarify, it is not just the bankers that have misappropriated state welfare and it is left to the reader to fathom the alternative productive uses those tax dollars could have gone towards (e.g., return it to taxpayers).

However, rather from learning from its past mistakes the US political class has guaranteed an additional $12.8 trillion worth of projects and bailouts in the past 20 months. Not only is this ethically a problem, but every dollar taxed and spent funding government projects is one less spent funding innovative tech start-ups run by accountable individuals; individuals who must satisfy customer demand as their reputation and profitable are at stake.

Furthermore, the Keynesian growth models promoted by Obama’s economic team navely suggest that there is a 1.5x multiplier effect for every dollar the government spends. Yet there is little evidence that this has ever been true and in many cases, only half of that level is ever attained.

On top of all of this, economist Benjamin Powell notes that government institutions are intrinsically poor investors and myopic entrepreneurs:

Any industrial policy that promotes one industry is necessarily a policy against other industries. For industrial planning to succeed, it must identify, better than markets do, which industries should be favored. In a free market, competitive bidding dictates how capital and labor are allocated, and profits and losses reveal what adjustments should be made. Information about which industries should exist is revealed only through the market’s process. Industrial policy rigs the market to enlarge some industries at the expense of others, thus undermining the process that generates the relevant information. Industrial policy faces the same knowledge problem as socialist planning: neither central planners nor anyone else can know the optimal industrial structure before the market produces it. Attempts at industrial planning are likely to hinder development by promoting incorrect industries.

Powell illustrates this with Japan’s Ministry of International Trade and Industry who stymied Sony’s very existence and attempted to micromanage Japan’s domestic automotive industry. On this side of the ocean, despite billions in handouts, government institutions like NASA did not invent anything that private enterprises could not have. And axiomatically, Obama’s industrial policies, whether it is energy or healthcare will also meet the same stillborn fate.

Arm, leg and your firstborn

At an international level everyone is drinking the same poisonous Keynesian juice. For example, G-20 participating countries recently pledged $1.1 trillion, on top of existing multi-trillion dollar packages, to throw down the financial money pit. Each dollar extracted by tax producers is one that cannot be spent developing sci-fi hardware and software sought after by futurists.

Why? Because in effect, every government stimulus is an unseen tax on potential entrepreneurial activity.

To compound matters, the US Treasury continually sells billions of securities each month in order to service the more than $11.1 trillion in debt. And contrary to what Congresswoman Maxine Waters suggests, none of that debt is retired. Not only that, but the Treasury actually has to pay annual interest on these securities (usually around 4% a year).

Imagine if that level of capital was instead allowed to finance productive, private enterprises instead of government programs!

Hindu rate of growth reincarnated

No matter how deep and wide the current recession ultimately is, policy makers have impeded future growth through methods no more effective than those of the Soviets or Indians. And while deep-pocketed, multinational incumbents such as Intel may survive this period of economic turmoil, current policies and models will make it difficult to fund the next generation of movers and shakers.

Furthermore, we have already seen the ill effects of centrally planned interest rates and centrally planned home ownership. We have seen what econometric models are incapable of measuring or quantifying. We have also learned that the government simply creates more problems than it solves, thus the last thing any industry needs is another czar, stimulus, or artificial growth model.

So to answer the question posed in h+ "is the future cancelled?" Probably not, but it will remain in slow motion for years to come and will not reach its full potential under this administration or the next.

And consequently, due to the highly inflationary acts of central banks over the past 18 months, consumers will be lucky if the deflationary pricing environment of the past 30 years continues into the next 10.

Tim Swanson [send him mail] is a graduate of Texas A&M University and lives in central China. Visit his blog.

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For instance, former Treasury Secretary Henry Paulson thinks that global trade imbalances with Asia pushed interest rates down and drove "investors towards riskier assets."

Brad Setser of the Council on Foreign Relations believes that Americans borrowed too much and Asians saved and lent too much to Americans — that Asian money consequently flooded the US economy and drove down interest rates.

Michael Pettis, an American finance professor in China, suggests that China overproduces and underconsumes, an imbalance that ultimately recycled large amounts of savings back into the US housing and securities markets, creating an unsustainable bubble.

However, the main problem with the explanations provided by Paulson and the burgeoning establishment line is that none of the Asian countries sits on the Federal Reserve board, the prime instigator of this effervescent predicament. And as influential as the China or Japan lobbies are seen to be by many, neither country sets the federal-funds rate or conducts open-market operations.

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Tim Swanson [send him mail] is a graduate of Texas A&M University and is shivering his timbers in central China. Visit his blog.

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The year is 1979. Soft-spoken minister Deng is quickly drawing up agricultural-reform plans to prevent widespread famine and to stymie civil unrest. Border skirmishes between the PLA and Vietnam turn into a hot war involving tens of infantry divisions. Total foreign investment amounts to a mere $800,000. To many foreign observers, the end of China is imminent.

The year is 1989. Perestroika-minded Gorbachev visits Beijing to repair diplomatic dialogue. International media outlets cover the bilateral event while thousands of students simultaneously occupy Tiananmen Square. By the end of the summer, tanks roll through the city and multinational businesses leave once again. To many foreign observers, the end of China is imminent.

The year is 1999. President Jiang continues reforms and privatizes thousands of state-owned enterprises putting more than 4 million Chinese temporarily out of work. Currency collapses sweep across East Asia smothering South Korea and Thailand. Industry leaders such as Daewoo go bankrupt. The IMF lends tens of billions of dollars to several emerging countries as their stock markets crash. During this period, China’s GDP drops more than 2.5% as exports slow. To many foreign observers, the end of China is imminent.

The year is 2009. China’s GDP growth slows to an unimaginable 5%. Exports to the developed world nearly stop as demand shrivels into the single digits. Half of all toy-exporting factories have closed, sending tens of thousands back to their family farms. Many foreign owners have quietly left the factories, leaving behind unpaid workers. Mainland stock markets continue to dip as listed firms repair balance sheets and account for losses from overseas investments. To many foreign observers, the end of China is imminent.

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Tim Swanson [send him mail] is a graduate of Texas A&M University and is shivering his timbers in central China. Visit his blog.

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Aarrr landlubbers!

If there is one thing swashbuckling pirates are good at, it is stimulating economic activity.

Pirates as far back as Captain Hook were not only dashingly dapper in their sans-culottes, but also astute economic planners.

Instead of being loathed, Hook’s modern-day counterparts should be embraced because their business model is a godsend in these dire times.

As they plunder, countries assemble naval task forces. The pursuing destroyers and cruisers must be cleaned and refueled. They must be manned from bow to stern by men who must be trained. These seamen must also be well-fed by cooks which creates a demand for culinary art schools. Bon appétit, pass the rum por favor.

The bounty the guile Somalis continue to incarcerate must be replaced. In doing so, companies must spend money purchasing the raw materials, transporting servos and manufacturing widgets. That creates jobs.

The hostages of captured vessels must be fed and sheltered. More jobs.

Media outlets covering the story spend money recruiting, hiring and training journalists. J-O-B-S.

Governments and politically-connected conglomerates must tap their treasuries and spend your booty to pay ransoms. In doing so, accountants and lawyers must be assembled and unleashed upon the marketplace. I’ll give you a hint what this means: it rhymes with robs.

More janitors will be needed to clean the offices, hallways and bathrooms of these weighty establishments. Elevator doormen and bellhops will be needed to operate hotels being visited by statesmen and relatives of the hostages. Cable repairmen will be needed on-call. And Chinese take-out services will need to hire extra staff to fill the insatiable orders from all of the above. Mucho trabajo!

Better yet, Plan B for bon voyage. Since pirate attacks are random and inconsistent, cargo ships should routinely dump containers overboard and scuttle vessels. Bulk carriers should emulate Blackbeard and send it all down to Davy Jones once a month.

Heave ho!

Either way, while the multi-national naval flotillas scour the high seas for the Black Pearl, we should all thank Jack Sparrow and his tricorn-wearing mateys because they create jobs and get us spending.

So this holiday season, be sure to tell your local pirate(s) Feliz Navidad — for without their enterprising minds, we would all be much poorer.

Tim Swanson [send him mail] is a graduate of Texas A&M University and is shivering his timbers in central China. Visit his blog.

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Beep. Beep. Beep.

The oversized mobile crane attempted to move backward along the winding alley and simultaneously maneuver its telescopic boom between low-hanging power lines and the brick levee holding up the banks of the Huangpu river.

Despite it being 9 o’clock on a Saturday evening and operating under a light drizzle, the crane achieved its momentary goal while tireless construction crews in the foggy background continued to cautiously climb through labyrinthian scaffolding and smother steel pylons in a deluge of quick-dry concrete.

In less than twenty years, Shanghai has transformed itself from a stagnate relic of geopolitical revolutions, into a modern metropolis rivaling the worlds incumbents. And as you drive into the Puxi district from the airport, the vantage point atop the Nanpu bridge gives you a half-obstructed view of the hundreds of construction crews that are literally building Neo Manhattan overnight. And then some.

Seen and unseen

While some of this property development was fueled by starry-eyed speculators, a lot of this boom was financed through cold hard cash. Modern day Chinese are some of the thriftiest people on the planet, saving roughly 56% of their wages — which makes the seemingly stingy Japanese appear as spendthrifts. Guess what level America is still at?

For instance, due to a number of variables including a relatively uncertain political climate, many members of the nascent middle class will park their savings in entire floors. And I don’t mean burying the money inside the walls. They will purchase an entire floor of office space rationalizing that in the long run, it could be safer store of value than many monetary instruments (e.g. stocks), or banks themselves.

And unlike their Spanish and Dubai counterparts which have created partially built ghost towns (video), not only were most of these buildings funded without taking out foreign loans or utilizing debt-based financial vehicles, but until recently, tenants were required to put a down payment of 30% on a unit. It has now been knocked down to a miserly 20%.

Yes, that’s right. The West is not only reeling in overcapacity brought on by numerous perverse factors (e.g., artificially low-interest rates), but millions of apartment and housing units are either going into foreclosure or already on the chop block due to lax lending standards that involved zero money down. Yet in China, even with deflating property values that have dipped more than 40% from their peak, the construction boom continues marching on due to stronger fundamentals such as solvent customers that have real jobs.

Beneath a veil of omnipresent dust

For fans of the Ghost in the Shell series, the local avant-garde architecture such as the Tomorrow Square building gives a clear illustration of what in twenty more years may be New Fukuoka. With or without the cyborgs.

Because behind the gigantic silhouettes, caricatures fully enclosed by green safety nets, unforgiving catwalks and bamboo facades is the emergence of a dragon awakening from a centuries-old hibernation. While the rest of the world squandered capital erecting wooden pyramids in the burbs (complete with mosquito-filled pools), within the coming decades the worlds largest consumer of concrete will have something to show for its sweat and toil: productive offices and factory spaces. Bona fide chambers of commerce.

Contra Doug French and Mark Thornton I believe Shanghai is the real McCoy and a positive sign of things to come for this region of the planet.

Tim Swanson [send him mail] is a graduate of Texas A&M University. He has worked throughout East Asia and currently lives in China. Visit his blog.

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Crunch. Slurp. Burp. "Another fetus please!"

Several years ago the late Christopher Reeves was lampooned in South Park, depicted as a maniacal fetus eater — stopping at nothing to consume nutritious embryonic stem cells.

I have recently received a number of emails from concerned family and friends regarding Barack Obama. In particular, his stance on abortion, stem cell research and infanticide.

While I will not delve into the topic of abortion, one of the repeated claims in the emails is that if elected, Obama would appoint a bevy of judicial activists who would turn the country into one big abortion machine.

Unwed teenagers, married yuppies, seasoned parents, pious nuns, even wholesome kindergarten teachers.

Under an Obama presidency, everyone would be encouraged and paid to have abortions. And they would be carried anonymously, quickly and with the convenience of getting an inebriated tribal tattoo.

"What are you doing this weekend?" Suzy the Citizen asks.

"Oh, I was going to visit the new Art Deco exhibit downtown, buy some hoop earrings, and getting an abortion. What about you?" replies Terri the Taxpayer.

"Oh what a happy coincidence, I was going to have one too! They are so much fun!" exclaims Suzy.

Missing the forest for the trees

While this issue is indeed controversial, it is insulting to suggest that this is somehow the penultimate reason for deciding between McCain and Obama.

They are both awful choices, neither of whom should be voted for. In addition, McCain should not at all be lauded or revered as the defender of life, especially after unrepentantly killing hundreds of innocent Vietnamese. Or as he calls them, gooks.

Additionally, the judicial appointments of Bush, both at all federal levels including the Supreme Court and Justice Department should raise concerns over whom McCain would appoint.

As judge Andrew Napolitano has noted, the Bush administration has violated nearly every civil right imaginable.

• erecting an unaccountable Homeland Security department that now has their own space-based spy program.
• permanently garrisoning US troops as part of the new Northern Command. What Posse Comitatus Act?
• using the NSA and other intelligence agencies to intercept all electronic communication from everyone including your sweet babushka.
• enacting dozens of anti-privacy statutes including the PATRIOT Act and REAL ID and even suspending the writ of habeas corpus.
• amending FISA to immunize companies that operate wiretapping stations and retroactively legalize any potential illegalities.
• compiled an ever-increasing dragnet dubiously called the "No Fly List" which has more than a million suspects. And good luck getting off the list.
• continued to operate and upgrade ECHELON listening stations domestically and overseas.
• passed a $711 billion defense budget with nary a peep, a week before the contentious $700 billion bank bailout. This is roughly the cumulative defense budgets of every other country on the planet.

Where were the cries from McCain supporter, pastor John Hagee? Where was the Religious Right? Where is the condemnation by either candidate?

Thus, ignoring star chambers, detention camps, extraordinary rendition, and PLA torture techniques, no amount of revisionist history could prop up the insolvent nature of the US administrations — including the presidential candidates — moral bankruptcy and brazen disregard for individual privacy.

Oh, but at least the administration was pro-life, right?

Standing on the side lines as accomplices

The self-appointed Moral Majority did not just stand by, but were active cheerleaders in this revolutionary judicial process.

Many of the same pro-lifers have also stood by while the Bush administration invaded and occupied a country that did not attack the US.

140,000 troops still occupy Iraq, many of whom will stay through the year 2011 as part of the controversial SOFA. And at least 88,000 Iraqi’s have died due to violence directly related to US military activity there — perhaps as many as 1.2 million.

If you’re against abortion on grounds that it takes an innocent life then you should always be against war and most certainly against the current occupation — and in all fairness, should be voicing similar opposition to it as well.

So while McCain may be against abortions, even on military bases, he still promotes a 100-year occupation of Iraq and a first-strike against Iran. To preemptively kill unholy heathens that might destroy the sanctity of life.

Heathen baby killers like Obama.

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Ever since I moved to Korea a number of people have sent me emails asking me if I had visited either locale. Despite the fact that I would like to check both places out, I am confronted with an ethical dilemma.

In order to travel to either one, you have to fork over some cash.

In the case of North Korea, nearly all of that money goes to directly fund Kim’s regime.

It’s hard enough being an American taxpayer knowing that a large percent of your money goes to fund a trillion dollar military apparatus, 16 multi-billion dollar intelligence agencies and dozens of overzealous federal law enforcement agencies. Never mind the fact that these monies in return go to squash civil liberties at home and incite bloody wars in other countries, including multi-year occupation forces.

But then again, taxpayers really have no choice for where their ducats go.

On the other hand, as a potential tourist, I can vote with my pocket book.

There is absolutely nothing to laud Kim’s regime for, so why reward him monetarily? There are no civil liberties, there is no private enterprise, there is no private property — there is no private life. His military consumes a full quarter of all economic activity each year, despite the fact that millions live in 18th century destitution. Any type of dissent is immediately squashed and provocateurs are sent to one of a dozen known labor camps.

For a good description of the life and times at one of these gulags, be sure to read The Aquariums of Pyongyang by Kang Chol-Hwan (he is kind of like the modern day equivalent of Aleksandr Solzhenitsyn).

So, when someone asks me if I will fork over a few hundred dollars to pay for the visa and tour package knowing that the money will not lift anyone out of subsistence but rather prop up a socialistic dictatorship, my answer is a big no.

Besides, this is not a backpacking adventure across scenic Europe. In fact, you really aren’t a real adult touring the land, you’re a baby. You cannot freely travel throughout the countryside. You are always accompanied by state-managed guides that have no qualms with confiscating any electronic devices. Cell phones are verboten entirely. Oh, and you are only allowed to take government-approved pictures, otherwise you have to delete them.

On top of that, the sites you do see are fake, entirely scripted affairs. The quaint little towns you pass through are no different than the fabled Potemkin villages of 18th century Russia.

So from a tourist perspective, why waste money on a staged 3-night stand that doesn’t even leave a mint on the pillow?

Similarly, a visit to the DMZ is if nothing else, a tacit approval for its current existence.

While the South no longer operates gulags (its own military dictators used to; see Unbroken Spirits: Nineteen Years in South Korea’s Gulag by Suh Sung), it would be no different than paying to see the Inner German border while it was still being judiciously guarded.

Most people forget, the DMZ is not the Berlin Wall. It has not come down. People can and still do get shot crossing over. It is filled with mines, booby traps, machine-gun nests and surrounded by over a million troops on both sides (it’s so barren of human-life that it has unintentionally become a nature reserve). Plus, it’s not like the money you pay to visit the DMZ is going to North Korean peasants, to pull them out of destitution or help them escape.

So, for the same reason that you don’t go up to a local in Hiroshima or Nagasaki and ask them joyously where ground zero is, I do not think I will visit the other half of the peninsula or even the DMZ until reunification years from now.

See also:

• Recent scenes from North Korea
• Gulags on both sides of the DMZ
• Firefox download statistics
• What do Shimon Peres and Mitt Romney have in common?

Tim Swanson [send him mail] is a graduate of Texas A&M University. He currently lives in South Korea and is a free-lance IT consultant. Visit his blog.

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Before you
do anything else, find a pen and write down these numbers: 83, 55,
21.

The discussion
of net neutrality intersects a broad array of issues. I have discussed
a number of them in the past and this piece will focus on a couple
areas, namely prioritization and discriminatory practices.

However, in
order to discuss net neutrality, we need to look at what the internet
is. It is not a browser like Firefox or Internet Explorer. It is
not an IM client like AIM or MSN. And it is not your Kindle or iPhone.

The internet
is tens of thousands of public and privately owned networks. A network
is simply two or more computers connected to each other. In many
parts of the world, families and independent businesses own and
operate small local computer networks. In the simplest terms, this
would be a private network. In contrast, if the source of funding
comes from taxpayers — through the NSF or even the PTA — those would
be considered a publicly owned network.

Each of these
networks are isolated silos of knowledge unless they are connected
to other networks.

If you are
reading this article, you somehow gained access to other networks
that pointed you to the LRC server. The traditional way of gaining
access to other people's networks is through an organization called
an internet service provider (ISP). There are hundreds of these
across the US alone, ranging anywhere in size from small mom-and-pop
operations that serve a few rural farms, to larger urban operations
that serve millions of clients.

The one thing
that these ISPs have in common is that they use standardized hardware
including servers, routers and switches to transport digital packets
from one end of the network, to the other.

Many of these
ISPs sign contracts with one another so that their clients can access
the servers, data, services, and clients on other networks. These
are called peering agreements and are part of a standardized business
practice that continues to evolve with advances in technology. In
a nutshell, they are contracts that state the terms of what each
party is willing to allow to happen on the network, who can be on
it and what kind of data is allowed.

It should also
be noted that not every network, public or private, is connected
to other networks. Sometimes this is a result of privacy and security
concerns, other times it is due to contractual disputes.

For instance,
in one high-profile case three years ago, Cogent and Level 3 Communications
had a peering dispute that prevented
over a million customers from accessing other networks. After a
couple of days mediating the dispute, they resolved the situation
and their clients were able to traverse back and forth as they had
before.

Discrimination

Every major
ISP uses hardware that can detect and monitor what kind of digital
traffic is moving through their network. There are a number of techniques
that they can employ to prioritize and discriminate bits of data.
And in many ways this quality-of-service (QoS) action is very beneficial
for both the customer and network owners.

For instance,
going back to the numbers mentioned at the beginning: in 2006, roughly
83% of all email sent each day was
unwanted spam. This amounts to anywhere between 60 and 150 billion
pieces of mail each day.

While there
are numerous entities that author and send spam, a large portion
of this spam comes from zombie computers that are referred to as
"botnets." A zombie computer isn't something that drools
(yet); rather it refers to the fact that the operating system has
been comprised by malicious code in the form of a virus, Trojan
or some kind of worm. Organized hackers are able to cluster compromised
computers into large networks and commercially benefit from property
trespass.

Many of these
botnet operators will sell access (pdf)
to "their" machines to the likes of mischievous spammers.
As a result, botnets produce tens of millions of unwanted spam each
day and continually evolve in an effort to stay ahead of anti-virus
and anti-hacking endeavors.

For instance,
in the past two years the Storm
botnet has collected up to 1 million compromised systems which
are used to propagate both spam and malware across the internet.
And more recently, a Brazillian was indicted
over operating a botnet comprised of 100,000 computers.

ISPs, both
small and large, are at the forefront of this never-ending battle.
And by using prioritization and discrimination practices, they are
able to hinder, impair and even terminate botnet attacks on their
networks. After all, both for-profit and non-profit have the incentive
to keep their networks operating efficiently for their shareholders
and stakeholders.

And speaking
of spam, in 2003, the US federal government passed the CAN-SPAM
Act which was heralded as a heavy-measured stick to ward off
and punish serial spammers. And while there have been several high-profile
cases of scammers, phishers, hackers and traditional spammers being
prosecuted, the volume of unwanted spam has increased more than
100% in the subsequent years. It is a resounding failure by all
objective measurements, as a year into its existence, only 1% of
spam complied
with the federal act. It hasn't gained much traction since then.

The smart
internet becomes dumb

Tim
Wu is a law professor at Columbia is perhaps the best known advocate
of net neutrality activism.

According to
him, net neutrality is legislative protection that would prevent
internet providers from discriminating and prioritizing digital
traffic. In other words, all traffic would be treated the same,
first-in, first-out.

In 2006, there
was a large push from grass-roots activists such as SaveTheInternet
to enact a number of resolutions that met Mr. Wu's guidelines.

Fortunately,
none of the legislation passed, yet the movement has gained momentum
and includes people from all walks of life, including indie rock
stars, bloggers like BoingBoing, viral phenoms like Ask-A-Ninja
and tech luminaries such as Vint Cerf.

In addition,
large media and content firms such as Google, Microsoft and brick-and-mortar
companies such as CBS have joined forces to lobby Congress to pass
net neutrality legislation. Furthermore, it has become a partisan
issue as presidential candidate Barack Obama, a Democrat, supports
it, and John McCain, a Republican opposes it.

On August 1,
2008, a divided FCC voted to admonish
and punish Comcast, an ISP. In the ruling — the first of its
kind – the federal regulators found the company guilty of violating
net neutrality principles for throttling and blocking traffic based
on the BitTorrent protocol.

Instead of
taking the company to court for what appears to be fraud, false
advertising or violating a service agreement, lawmakers have created
a legal environment of uncertainty. Kevin Martin, FCC Commissioner,
voted in favor of penalizing Comcast. However, both Martin and Tim
Wu have repeatedly stated that ISPs should be allowed to
prioritize Voice-over-IP (VoIP) communication — creating a nebulous
exception to their rule.

Which brings
us back to the numbers again: in 2006, 21% of all international
phone minutes were conducted
with VoIP. This technology, while not new, has been very disruptive
as it has taken away swaths of market share from the traditional
circuit switched enterprises. By 2010, it is predicted that more
than half of all international calling minutes will use VoIP.

If net neutrality
laws are enacted, VoIP usage would become an impractical means of
communication hence the reason it is exempted by most net neutrality
laws. The main reason has to do with the nature of the service.
The most efficient phone call is one in which there is no discernable
lag time between the talking of each party. Because VoIP shares
the same networks that all other internet traffic is routed through,
achieving low-latency becomes a never-ending battle. It has to compete
with spam, malware, denial-of-service attacks, as well as streaming
videos, file transfers and video games.

Subsidizing
buffets

Over the past
decade, most ISPs have prioritized internet traffic based on a number
of factors. And while each list is somewhat different, ISPs generally
try to give VoIP callers higher throughput priority.

However, many
of these ISPs have also dug themselves into a hole with unlimited
usage agreements. While there is no such thing as a libertarian
business model, it would seem unwise to offer unlimited anything
and expect that no one will take advantage of it.

For instance,
according to Time Warner (an ISP), a mere 5% of its customers use
more than half of its available bandwidth, and 25% of its customers
use 85% of it. And the vast majority of this traffic is generated
through peer-to-peer (P2P) transfers like music and movies.

The most popular
P2P application used by these customers is one called BitTorrent.
Which brings us to the last number. According to its creator Brahm
Cohen, BitTorrent comprises
55% of all internet traffic (incidentally Cohen has spoken out against
net neutrality legislation).

In order to
insure that VoIP conversations remain discernable, ISPs will throttle
or limit the speed at which BitTorrent traffic can flow through
their networks. As a result, advocates of net neutrality have cried
foul due to the discriminatory nature of this model and the recent
Comcast case provided them with ammo to continue their witch hunt.

Thus, on the
one hand they want access to other networks, but on the other, they
don't want to abide by service agreements that implement throttling.
The easiest solution to this quagmire is to simply switch ISPs —
which I discuss here.

Unseen casualties
of war

If net neutrality
laws are enacted, not only would time-sensitive applications like
VoIP be negatively effected, but so would telemedicine, telepresence
and twitch gaming.

Telemedicine
is a nascent field that involves having a group of doctors virtually
operating on a patient perhaps as far away as the other side of
the planet. Cases have ranged from merely consulting other physicians
to actually remotely operating a surgical robot. If ISPs were not
allowed to discriminate, then this function will be severely impaired
due to the low-latency requirements it needs.

Telepresence
is another budding field in which business meetings can be held
thousands of miles apart with the aid of digital monitors and web
cams. Instead of commuting or flying across the planet, business
associates could simply rent a telepresence room and speak face-to-face
with their colleagues. However, like VoIP and telemedicine, low-latency
and high-throughput is necessary for achieving real-time conversations.

And twitch
gaming includes both online gaming found on consoles as well as
PC games. The lower the latency, the more effective players will
be at achieving strategic victory (i.e., beating their opponents).
If net neutrality legislation was passed, ISPs could not effectively
prioritize this traffic.

Right now there
are several companies that provide solutions actually operate by
discriminatory practices for customers: GameRail offers the lowest
possible latencies for online computer gamers, Cisco maintains telepresence
rooms across the globe, and Akamai operates one of the largest video-caching
services (a similar service was
used by Limelight to serve videos for the summer Olympics).
Each of these services prioritizes traffic along networks they lease
or own. And according to net neutrality advocates such as RampRate,
this is bad.

It doesn't
cost a thing to build a new network or upgrade an old one

The
one thing that net neutrality advocates continually overlook is
that bandwidth is scarce. It is scarce in America as it is scarce
in both Asia and Europe. Furthermore, building and maintaining a
network is a very capital-intensive endeavor with low return-on-investment.
For example, earlier this year, Google and six other companies pooled
together resources to fund
a $300 million fiber optic link between the West coast and Japan.
Constructing this line will take several years and won't be complete
until 2011.

Similarly,
to build a new backbone on land, entrepreneurs must: pay for permits,
conduct environmental studies, rent or buy property, recruit labor,
apply for technology licenses, purchase construction materials,
install fiber optics, manage network equipment, and even play the
game of politics. All told breaking new ground in an urban environment
like Dallas can cost up to $1 million per mile.

Yet, if net
neutrality legislation is enacted, the federal government will essentially
be telling ISPs that they no longer own their own networks (i.e.,
network operators can no longer do whatever they want with their
own property). Thus, this has become a battle over property rights.
And as a result, many entrepreneurs and capitalists will no longer
invest in the capital resources necessary to maintain or upgrade
the facilities.

On this point,
while Vint Cerf (a "father of the internet") is a vocal
advocate for net neutrality (and
socialism), his peer Bob Kahn (another "father of the internet")
has noted
that net neutrality legislation will remove the incentives for any
company to build-out a next generation infrastructure.

In fact, if
advocates of net neutrality were to truly put their money where
their mouth was, they would have taken their purses and built new
backbones to accommodate their egalitarian service plans. At least
the owners of
Copowi have done so.

Furthermore,
why have these advocates not formed protest around other industries
that use prioritization? For instance:

• Commercial
  airline operators like JetBlue charge variable rates based on
  numerous factors including if you booked weeks in advance — yet
  you arrive at the same destination as those who pay more.
• Most sport
  teams will charge variable rates based on what section of the
  stadium you sit in, if you purchase as a group, and what day of
  the week — yet everyone watches the same game.
• Amusement
  parks such as Six Flags sell both general admission and express
  passes which allow ticket holders to skip lines entirely — yet
  everyone goes on the same ride.
• Mail delivery
  carriers like DHL, UPS, FedEx and even the US Postal Service charge
  variable rates and prioritize mail based on size and speed at
  which the package will be delivered — yet all of the packages
  on a plane arrive at the same location.

And perhaps
the most blatant disregard for hypothetical neutrality laws is Google
itself. Dave Girourad, a manager at Google, has
stated that “PageRank relies on more than 100 variables.” Thus,
why is it unfair for an ISP to use various factors to transmit and
organize data? It is their infrastructure.

Solving
the non-existent problem

The internet
is not a public utility, nor should it be treated as such. In fact,
up until the late 1980s the network was largely nationalized and
innovated at a snails pace. It was not until the primary backbones
and datacenters were privatized that the modern internet was born
due to commercial incentives for private entrepreneurs. And by renationalizing
the pipes, the federal government will be undoing all of the liberalization
that has made the internet glorious.

The real problem,
and one that appears to be politically unthinkable, is a complete
decriminalization of the telecommunications industry. We have tried
regulation and socialism for over 130 years (with the original government
patent to Bell). Yet today, the industry is still heavily regulated
and is by no means a deregulated encapsulation of laissez faire
capitalism.

Net neutrality
is a solution to a problem that does not exist and only serves to
centralize federal control yet again. In addition, if an ISP breaks
a contract, there is already a legal framework in place to deal
with service agreements. So how would data discrimination warrant
the need for new oversight?

Furthermore,
by granting more power to the FCC, this would only be handing more
snooping power to a government that has continually shown to abuse
existing mandates and treat everyone as a potential terrorist.

Thus
in an ironic twist, while individuals like Lawrence Lessig and organizations
the EFF have detailed NSA
wiretapping surveillance abuses, they are now unwittingly promoting
a stealthy federal power grab that would be just as omnipotent.
After all, the FCC, Justice Department and FTC will need to monitor
every ISP to make sure no discrimination or prioritization takes
place.

Maybe the government
will be nicer this time around, right?

Further reading:

• Against
  a National Broadband Policy
• The
  Spectrum Swindle
• The
  Spectrum Should Be Private Property
• Does
  the US need another Chief Technology Officer?
• Who
  Owns the Internet?

September
4, 2008

Tim
Swanson [send him mail]
is a graduate of Texas A&M University. He currently lives in
South Korea and is a free-lance IT consultant. Visit his blog.

DIGG THIS

It already
has three.

The first CTO
is the 30-year old, federally governed National Telecommunication
and Information Administration which formulates policy and advises
the president. During the Clinton-administration one of its ventures
was the National Information Initiative which siphoned billions
of taxpayer money into a slew of unproductive projects. This has
been chronicled in the “$200 Billion Broadband Scandal” by Bruce
Kushnick (pdf).

The second
CTO is the collective lobbying from the special interests of Big
Telecom. Many of these firms not only receive legal protection over
"last-mile" services, but billions in subsidies in the
form of another federally managed project, the Universal Service
Fund. And they just threw themselves a big party (for
immunity).

The third CTO,
which has led a centuries old, heroic fight against federal regulators,
is the individual innovator and tax producing consumer.

Yet according
to some pundits, the US needs a fourth CTO, in the form of another
federal apparatchik.

Revisionist
history

As Peter Klein
has previously noted,
while government contracts may have invented the internet, private
entrepreneurs transformed it into something useful.

For decades
prior to deregulation, it was downright criminal to try and compete
against a federally managed AT&T. And a plethora of whiz-bang
inventions stayed inside monolithic government-funded laboratories
because those that had invented them had no incentive to repackage
them for everyday consumption.

It was not
until guys like Steve Jobs figured out ways to commercialize them
that their full potential was tapped. Similarly, it was not until
the late 1980s when the nationally funded backbones and data centers
were privatized and commercialized that the Internet became useful
and accessible to both the masses the innovative entrepreneur.

In fact, the
prime mover behind productive web 2.0 applications and services
has continually been private entrepreneurs. Not a single flagship
web 2.0 application was invented by government-related contracts.
Similarly all of the innovation that has taken place in the WiFi
arena was directly related to the fact that the federal government
no longer licenses the 900 MHz, 2.4 GHz and 5.8 GHz areas of the
radio spectrum.

Yes, believe
it or not, but when the FCC actually opened up the ISM frequencies
in the early 1980s, they made themselves irrelevant
in the process. With any luck, white space devices will continue
this trend of self-immolation.

Pick and
choose

However, influential
members of the digerati are missing the underlying libertarian theme
of deregulation within the past developments.

For instance,
what do the following men have in common?

• Mitch Kapor
  of the EFF
• Robert Scoble
  an A-list blogger formerly of Microsoft
• Larry Lessig
  creator of Creative Commons
• Nate Anderson
  of ArsTechnica
• Michael
  Kanellos of CNet
• Cory Doctorow
  of BoingBoing
• Vint Cerf
  of Google
• Om Malik
  of GigaOm
• Erick Schonfeld
  of TechCrunch

All of these
individuals are not only at the forefront of analyzing the latest
technology trends, but all of them have advocated for more federal
management of both telecom and computer innovation.

However, the
US needs a technology CTO just like it needs a chief textile officer
or CTO of dinette sets. The prescription for future innovation is
not an Obama tech czar, but less regulation in which the entrepreneur
is disciplined by consumer dollars, and not political action committees
or the Politburo.

Ever since
Alexander Graham Bell's patent 130 years ago, every administration
and Congress has attempted to regulate, manage and oversee a swath
of technology-related industries. And it has only held back the
industries from developing and innovating.

It
is time to try a new modus operandi: no government intervention,
period.

Therefore if
there is one message to get behind each and every year, just say
no to CTO.

Further reading:

• Against
  a National Broadband Policy
• The
  Spectrum Swindle
• The
  Spectrum Should Be Private Property
• Who Owns the Internet?

August
29, 2008

Tim
Swanson [send him mail]
is a graduate of Texas A&M University. He currently lives in
South Korea and is a free-lance IT consultant. Visit his blog.

DIGG THIS

Of the nearly
3,000 victims of the 9/11 attacks, more than 10% were foreign nationals.

Two dozen Canadians
were killed
with the collapse of the World Trade Center towers in what is the
worst terrorist attack on citizens of that country.

In addition,
twenty-four Japanese, twenty-eight South Koreans and sixty-seven
citizens of the UK were among more
than 300 foreign nationals from dozens of countries killed that
day.

And the seventh
anniversary is less than a month away.

Half a world
away

This past week,
a somber anniversary took place, the 63rd anniversary
of the vaporization of tens of thousands of people living in two
Japanese cities.

There have
been untold volumes of literature and research written debating
both sides of this issue. Yet, one important detail that is often
overlooked: of the roughly 250,000 deaths promulgated by Little
Boy and Fat Man, more than 15% of the victims of the slaughter were
residents of other countries.

When Harry
Truman authorized the nuclear destruction of Hiroshima, he became
responsible for the deaths of:

• More than10,000
  Korean laborers
• Over 2000
  Japanese-Americans
• At least
  a dozen American POWs
• Hundreds
  of Australian, Dutch, and British POWs
• Hundreds
  of Chinese laborers (from Manchuria) and students from Southeast
  Asia

Three days
later, when Harry Truman authorized the nuclear destruction of Nagasaki,
he became responsible for the deaths of:

• At least
  10,000 Korean laborers (another 10,000 hibakusha were harmed
  by radiation)
• More than
  a dozen American, British, and Dutch POWs

After the radioactive
dust cloud settled, between 35,000–50,000 non-Japanese people
became
shadows on pavement and their only crime was being in the wrong
place at the wrong time.

In fact, the
Japanese-Americans (as many as 3200) had all been denied re-entry
at the start of the war. And no, these weren't spies and military
officers — just as none of the 100,000 Japanese-Americans incarcerated
from the West Coast had ever posed as a credible threat to US military
operations.

Crawling
with divisions, right?

Neither city
was home to a major military base or naval shipyard. Neither had
been on the strategic bombing list used by the Allies (e.g., 67
other cities). As a matter of fact, neither had been bombed
at all as they had essentially been put on a "do not touch
list" by General Curtis LeMay who wanted to see what the full
brunt of the bombs could do to modern cities.

Curiously,
the original motivation behind building the bomb in the first place
was to beat the German effort and presumably unleash its energy
on Dresden II & III and not Japan. In fact, even by the
end of the war, Japan had neither the resources nor scientific community
to construct such a device.

However there
had been a kink in the original Allied plan: because Germany was
defeated back in May, LeMay still had a couple of bombs that needed
to be tested on something. After all, it would be a waste
not to use them after so much effort was put into making them. Thus
the home islands of Honshu and Kyushu ended up playing the unwitting
host to two gruesome experiments.

It was necessary
for surrender, right? Wrong. Japan had been suing for peace throughout
the entire summer. In July of 1945, the US was actively
intercepting communiqués between Japan's Foreign Minister
Togo and Japan's Ambassador to Moscow, N. Sato. These messages clearly
noted that Japan wanted to surrender and were actively requesting
audiences and frameworks.

In addition,
no matter what side of the political aisle you sit on, there is
at least one other alternative Truman could have employed to illustrate
the destructive power of the bombs without annihilating population
centers. He could have detonated the bombs on an uninhabited island,
allowing Japanese POWs, the Russians or even the neutral Swiss to
see the effects. Or maybe LeMay was right when he said
later, "The atomic bomb had nothing to do with the end of the
war at all."

Peace dividends
that never came

Promptly after
their decimation, both cities were quarantined and a strict media
blackout was enforced. Even war-time correspondents, such as George
Weller were prevented from going in (he covered the aftermath but
his reports were
suppressed until his death in 2002). And of the more than 350,000
US troops that occupied Japan after its surrender, roughly 40,000
US soldiers occupied Hiroshima and another 27,000 occupied Nagasaki.

Today, more
than 33,000 US soldiers are still stationed throughout the Japanese
isles. Tokyo Bay plays permanent host to a US aircraft carrier.
Okinawa is home to more than 15,000 Marines. And the curses of LeMay
and Truman continue
to vex the Japanese people: in the past fifty years more than 1000
Japanese civilians have been killed due to the actions of the occupying
military (from negligent driving to violent rape).

But let's ignore
these accusations of occupation and focus on the issue du jour:
if Truman cannot be called a terrorist for indiscriminately killing
people, than neither can Osama bin Laden.

Don't buy it?
Well, each year — like clockwork — the respective mayors of Hiroshima
and Nagasaki speak
out
against nuclear proliferation and scrutinize those who threaten
to ever use the devices. It's an odd situation because in retrospect,
Tadatoshi Akiba and Tomihisa Taue should be thanking Truman who
was willing to sacrifice 250,000 to purportedly save a million.
Killing for peace — for the greater good.

Or
maybe not.

Next month,
while you remember the victims of 9/11, also remember to mourn the
victims of 8/6 and 8/9.

Further reading:

• Hiroshima
  and Nagasaki by Ralph Raico
• Conservative
  Revisionists and Hiroshima by Leo Maley and Uday Mohan
• Not
  Everyone Wanted to Bomb Hiroshima by Leo Maley and Uday Mohan
• Remember
  Hiroshima by David Henderson
• Hiroshima:
  Was it Necessary? By Doug Long
• Nagasaki
  atomic bombing, 1945 by William Robert Johnston
• Remembering
  Normand Brissette by David Rubin
• Hiroshima
  and Nagasaki Occupation Forces (pdf)
  by the Defense Threat Reduction Agency
• Atomic
  Bomb Casualty Commission by the National Academy of Sciences

August
13, 2008

Tim
Swanson [send him mail]
is a graduate of Texas A&M University. He currently lives in
South Korea and protested the Iraqi invasion on February 16, 2003
in Dallas. Visit his blog.

DIGG THIS

When was the
last time you looked up the Falun Gong, Tiananmen Square or the
history of Tibet? I'm assuming it's hourly.

In fact, your
homepage is the Wikipedia entry on one of these, right?

As I previously
noted,
anti-China rhetoric reaches louder decibels every day. And while
I don't condone government-mandated and funded censorship of any
kind, the question remains, are you practicing what you have preached?

Have you done
your patriotic duty and talked to a member of the Taiwanese Independence
movement lately? Did you reenact the Tank Man scene with your American
Legion compatriots last weekend? Every morning you unfold and hang
Old Glory along with the Tibetan colors from you balcony, right?

If you didn't
march against the Iraq war, against warrantless wiretapping, against
the persecution of the polygamist sect in Texas, or against the
millions of other coercive actions enacted by the state each year,
then you probably shouldn't trot around on your midget pony.

Raging against
the real machine

So you're out
of school for summer break and don't want to work. A person you've
never met invites you to an event on Facebook. It's an anti-dumping
campaign targeted at Chinese manufactures who are selling products
for prices that make you blush. It's also a rallying call to inform
Americans that Chinese laborers work more than you would ever want
to. What a grave injustice! Something must be done to prevent consumers
from paying too little for products you will never buy.

And so you
climb into your Honda hybrid, whose parts were forged
in Changchun and Guangzhou – China.

On the way
you stop by Wal-Mart (China's 8th largest trading partner)
and purchase a megaphone (assembled in China) and an American flag
(stitched in China).

You finally
arrive with your compatriots and are quickly shuffled behind some
chain-link fences by riot police. You pull out your cell phone (assembled
in China) to send a status update to your Twitter and Facebook accounts
(which reside on hardware assembled in China). You feel proud that
you're telling everyone how evil and anti-human the Chi-Coms are
– while you fumble around your pocket to find your camera (made
in China).

Heroically
you fight the elements underneath your umbrella (made in China)
all afternoon long. And after an energetic day of screaming about
China's responsibility for ungreen environmentalism (1/3 of China's
carbon emissions are purportedly tied
to creating exports: your productive tanning bed and cappuccino
machine) you call it a day and declare a win for human rights activism.

So my question
is: did you have a fun time hanging out in the government-restricted
free-speech zones?

The serial
suburban activist with a lot of time on their hand doesn't know
this but there were more than 20,000 documented
protests in China in 2006 alone. Take that NED!

One of the
reasons why these huge numbers don't make the headlines of the Worker
Weekly is because why the Chinese are protesting. The vast
majority are farmers upset over land confiscation, families fighting
over eminent domain, and business owners frustrated with kleptocratic
officials. Or in other words, against property violations by the
coercive actions of the state.

While historical
ignorance and political suppression could certainly be key factors
as to why more Chinese don't have the opportunity of being a professional
protestor, perhaps another reason so many residents aren't filling
the streets protesting is that they are preoccupied
working — you know, making money and stuff — so they can feed
their families. Because after decades of living in socialistic subsistence
the vast majority of the population is finally (relatively) free
to actually accumulate wealth, property and even become rich.

Do as we
say, not as we do

The modern
act of peaceably assembling in the West began as a means to redress
the government for injustices such as any taxation, property confiscation
and ex post facto laws. It is dead and has been wholly replaced
by a throng of tax consumers who rally for more government intervention,
regulation and omnipotence.

Despite an
ever increasing series of injustices conducted by the government,
the vast majority of organized protests in the West are designed
as bully pulpits, to rail against globalization, against trade,
against companies, against working as many hours as you want to.
They are led by what Joseph Schumpeter referred to as a "leisured-class"
of student council wash outs, most of whom have never worked an
honest day in their life.

Their kvetchy
chants, body odor and stitched pieces of flair are synthesized into
a cacophonous chorus of hate. Hating individual decision-making
and responsibility. Hating the capitalist factory owners. Hating
the factory employees for not unionizing. Hating the factory products…
such as the megaphone which is used to spew the kvetchy chants.

And this anti-capitalistic
mentality is selective. After all, where are the rallying cries
"Free the Lower East Side" to protest the past actions
of then-Governor LaGuardia and President Roosevelt who condemned
apartments and forcefully removed thousands of New Yorkers in Manhattan
to make way for public works projects?

What about
"Free Hawaii?" After all, it was colonized by the American
military who forcefully dethroned its monarchs. And unfortunately
this list continues (e.g. Native Indians) and takes forever to read
so let's ignore it and move on.

Our hours

Residents of
continental Europe and even much of North America also own the dubious
distinction of wanting to legally limit the maximum amount of working
hours. Yes, instead of negotiating hours individually with your
boss, sycophants of Big Labor have effectively politicized how much
your neighbor can work each week.

In contrast,
millions of Chinese factory workers seek and desire overtime, so
they can make sure their children won't ever have to work in a factory.
And oddly enough, many Chinese factory owners actually have to limit
the hours of their employees, not out of a malevolent desire to
repress them, but because they just don't have the product demand
to warrant overtime.

It is these
same Chinese laborers that have been unwittingly duped into handing
over at least $4000 of their own money to prop
up the US dollar. Yes, that is right, China's $1.8 trillion
reserve helps the Jones' at the expense of the Wang family. Might
want to add them to your Christmas card list for this year (and
thank them for the American
flags too).

Yet as Lew
pointed
out last year, both Sinophobic politician and professional protestor
alike have called for increased government intrusion and intervention
in the germinating enterprises, in the Chinese factories that are
the lifeblood of the Western consumer who scream incessantly about
phantom menaces from afar. Didn't China just try socialism en
masse?

Dot protest

And this deafening
temper tantrum has reached cyberspace as well. Instead of investigations
of Cisco, RSA and Sun — companies that actually built the Great
Firewall of China – Google executives faced a congressional
inquisition
two years ago.

This was done
despite the fact that Google does not actually remove information
at all. Eric Schmidt has noted, in the event a user searches for
non grata sites Google does not upload a doctored webpage. 
Rather, Google simply displays an error message noting that the
page the user is looking for has been blocked due to political restrictions. 
Schmidt rightly says that this approach will plant a seed of desire,
a desire to find out what is on that page.  As a consequence,
years of information holes could easily cascade and snowball into
a grassroots effort to have the blacklists wholly expunged.  

To
add insult to injury: this is the same bellicose congress that has
spent billions in taxpayer funds to secretly design and deploy NSA
wiretapping surveillance stations across the country. It is the
same congress that passed a slew of anti-civil liberties laws including
the latest
FISA immunity. It is the same congress that has borrowed tens of
billions from the People's Bank of China to fund an invasion of
Iraq which has killed 1.2 million Iraqis. And don't even get started
with the funding
of propaganda.

Thus, the next
time you feel like yelling, screaming and chanting about how evil
the Chinese are, make sure you have exacted the same amount of energy
and animosity towards the FCC, towards public schools, public libraries,
IP law firms and other agencies that use taxpayers money to censor
speech and block search results domestically.

August
7, 2008

Tim
Swanson [send him mail]
is a graduate of Texas A&M University. He currently lives in
South Korea and protested the Iraqi invasion on February 16, 2003
in Dallas. Visit his blog.

DIGG THIS

Since World
War II, the US military has bombed, invaded and occupied dozens
of countries. In the last 25 years alone it has caused fatal action
in over a dozen countries spanning the globe. The American empire
currently boasts a peerless expanse comprised of more than 300,000
men and women stationed in over 700 bases throughout nearly 130
countries. [1]

To fund its
ambitions, traditional empires have historically extracted rents
and tributes from the subjugated regions. The American empire on
the other hand, has craftily erected an unseen tax, through pegged
currencies and bank reserves.

Gone are the
days of hauling cumbersome reparations of bullion across valleys
and rivers to the local chieftain. The new, carbon-friendly method
for funding the federal empire is by selling US treasury securities
to countries that peg their domestic currencies to the USD. And
as Congress legislates a never-ending array of spending appropriations,
the US taxpayer is somewhat sidelined for bigger, faceless purses
thousands of miles away.

In order to
maintain their peg, countries such as Kuwait and Saudi Arabia must
purchase US treasuries and expand their credit supply to keep their
domestic ducat at par with the USD. However, the people who actually
pay for these treasuries are not central bankers, but rather anyone
with denominated assets in the domestic currency. Thus the average
Saudi consumer witnesses inflation first hand when the price of
everything, including oil, increases (e.g., they lose purchasing
power because more credit is chasing a fixed supply of goods).

Debt is literally
America's largest export as foreign banks and sovereign wealth funds
have amassed trillions of increasingly worthless dollars; and it
is the number-one revenue stream that funds the American empire
from sea to shining sea. [2]

The
Chinese walk upside down

As the Summer
Olympics approach, self-righteous pundits from the West have concocted
a false image of a rising, military empire from the East bent on
world domination.

Yet nothing
could be farther from the truth.

While the rhetoric
and actions of Chairman Mao certainly held such ambitions, many
of the reforms of Deng Xiaoping are nothing short of liberalism
in its purist sense.

First and foremost,
he slashed the 4.5 million-men military by more than half and reinstituted
civilian control over it.

Contrast this
trend to verbiage extolled by Bush, Obama and McCain. Not only
do they not talk of dismantling the Imperial legions; they
all want to increase the size of the military.
[3] Dare we even discuss Congressional oversight over military
activities, or lack thereof? [4]

Members of
the Blue Team, perhaps the most influential sinophobic organization
today, speak of a widely expanding Chinese military.
[5] If one is to believe the official GDP numbers of either
country, China still spends less than half of what the US does as
a percentage of GDP (1.7% versus 4%). [6]

Ah, but the
Chinese military hides the military expenditures in the shadowy
Chi-Com corporations, right? Wait, and the US military doesn't?
According to economist Robert Higgs, while the official US military
budget is roughly $550 billion a year, when the defense funding
that is spread across a slew of other government agencies is added
together, the scales tip at over
$1 trillion.

But the US
must continue to build up and maintain a force in the event that
hostilities with China occur, right?

The US spends
more than the rest of the world combined on defense appropriations.
The UK ranks 2nd, China ranks 4th. And even
if you doubled China's defense budget by assuming they smooth their
numbers like their American counterparts, the Chinese budget would
reach one-tenth of what the US spends each year.

Government
laboratories

While there
have been several cases of purported Chinese espionage of the US
satellite, nuclear, and intelligence gathering agencies, the Chinese
have a nuclear arsenal of about 200 warheads — equivalent in size
to the clandestine efforts of Israel. In contrast, the US military
has more than twenty times that number and threatens to use them
on a semi-monthly basis against a slew of imaginary enemies (e.g.,
Iraq, Iran). In fact, the US military is the only organization
to ever have detonated not one, but two of the weapons in an offensive
role.

But the Chinese
are stealing the satellite imaging and guidance technology to use
on the continental US, right? Again, who is the organization that
they allegedly stole it from in the first place? Why does the US
military still have armed weapons aimed at countries that pose no
threat? Where is the uproar and protests in the street for the
fact that the US military has developed weapons of mass destruction
and guidance systems in the first place?

If nothing
else, this is a great argument for why the US military should shut
down its government labs — so the lethal information cannot be used,
let alone stolen, in the first place.

China will
attack Taiwan

Nothing could
be farther from the truth. Since the late '70s, Taiwanese businessmen
have invested billions on the mainland setting up factories and
enterprises. In 2007 alone, cross-strait trade accounted for more
than $100
billion. And relations have become even rosier under the new
Ma administration, in which among other liberalizations, the first
direct flights between the two landmasses have taken place in sixty
years. [7]

In contrast,
every administration since Kennedy has heaped sanctions, barred
cultural exchange and threatened embargos on the isle of Cuba.
[8]

New Orleans
versus Sichuan

Perhaps the
microcosm that easily illustrates the mentality of the two governments
is recent natural disasters. Shortly after Hurricane Katrina landed
and devastated the Mississippi delta region, the governor for Louisiana
was unable to fully mobilize the Louisiana National Guard, because
35% of the units were deployed to Iraq. And to add insult
to injury both FEMA and Bush were too proud and incompetent to allow
outside help from assisting with the relief effort, including specialists
from other countries.

In contrast,
shortly after the powerful earthquake that shook Sichuan to its
knees, the PLA, which wasn't trying to police the world, was able
to fully mobilize to assist in the relief effort. On top of that,
the PRC accepted aid not just from their historical adversaries
the Japanese,
but also aid kits and search & rescue specialists from their
political rivals in the south, from Taiwan.
In fact, the PRC reportedly received so much aid and assistance
that they essentially ran out of physical room and had to temporarily
turn away helpers. In contrast, the boondoggle of New Orleans in
the aftermath of Katrina is legendary as large organizations like
Wal-Mart were turned away because they didn't have permits. [9] [10]

Bumper sticker
brigades

While
China may not have fully changed or modified itself in a manner
that outsiders desire, it has made substantial reformations. These
reforms should be applauded, encouraged and perhaps emulated by
the West. Western countries such as the US and UK are on a dangerous
road to become the very Orwellian countries that is dramatized in
Hollywood dystopias.
[11]

For instance,
while some civil libertarians chastise the PRC for its omnipotent
Seeing-Eye project, in London alone there are more than half-a-million
security cameras watching your every move. [12]

Another easy
target critics have of the PRC is the persecution of the Falun Gong.
Does anyone else recall what happened to the Branch Davidians at
the hands of the ATF? Who bulldozed and torched a compound filled
with children? What about the recent hysteria surrounding trumped
up charges of the polygamist sect in Texas?

One-child policy
is unique right? What about federal funding of abortions vis–vis
Planned Parenthood, or the onslaught of taxes and inflation that
prevents American families from having more than one or two children?
[13]

Perhaps worse
yet: Iraq. While it has become chic to slap a Free Tibet or Save
Darfur sticker on the back of your VW van, in terms of the blatantly
observable disregard for human rights and civil liberties: what
about the 1.2 million Iraqis that have died either through collateral
damage or civil unrest since 2003?
[14]

Singing
a different tune

This touches
on yet another holy rite progressive citizens of the West condemn
the PRC: their precious protests and marches. While the average
Chinese person may be prevented from publicly voicing their dissent,
the West has all but given up on this purported natural right.
Not only has the West stood by while its governments have ransacked
and plundered regions of the planet, but by voting for wiretapping
immunity, warrantless searches, secret tribunals, and rendition-filled
prisons, it has become the very police state it supposedly abhors.
[15]

In contrast,
what foreign country has the PLA invaded and occupied within the
past 25 years? The last foreign entity China fought with was Vietnam
in 1979, for 16 days. They are now trading partners, erecting roads
and rails to exchange raw materials, ideas and finished goods.
[16]

In the last
decade alone the US government has attacked and occupied parts of
Africa, Eastern Europe and the Middle East. And to add insult to
injury, US politicos are trying to build a wall between its largest
trading partner — Mexico — the one country whose relatively cheap
manual labor and resources allows the non-war-protesting, Free-Tibet
residents of America to live comfortably in an inflation funded
suburban house.

Unrest in Tibet.
While some of the protests may be genuine, the CIA has had a long
history of funding Tibetan insurgents beginning with operation ST
Circus in the late 1950s. [17] This is not to say that Tibet should have been invaded or
occupied in the first place, as that is an issue for another article.
Rather, with the recent revelation that the CIA was given $400
million in 2007 to arm and equip insurgent groups with Iran,
and given the fact that the CIA also spent billions of dollars in
the '80s arming and training the Mujahideen against the Russians
in Afghanistan (Operation Cyclone),
it is conceivable that the CIA is possibly behind the
recent unrest in Tibet. The incentives are there: embarrass the
Chinese at their coming-out party.
[18]

Sino apologist
or Sino realist?

This is not
to defend or condone all of the actions of the PRC, rather as the
parable notes: it is to point out that before you complain about
the speck in someone else's eye, you worry about the plank in your
own.

Perhaps the
most ironic illustration of how the West and East have traded places
both morally and economically involves the Korean War. It was recently
uncovered that the current interrogation methods practiced by the
US military in its fight against terror were actually scripted by
another entity nearly sixty years ago.

It turns out
that when the PLA captured UN troops (including Americans) during
the Korean War, they put together a handbook of interrogation techniques,
many of which were condemned by the international community as torture.
Guess what standard techniques the US military is currently
using to extract information from alleged terrorists at Guantanamo?

The
People's Republic of Capitalism

Beginning in
the late ’70s and early ’80s Deng Xiaoping created Special
Economic Zones within various regions of China. These were the
first experiments in a move from centrally planned socialism to
decentralized capitalism. And boy have they ever paid off. While
tomes have been written on the rise of Hong Kong and Singapore as
business-friendly export zones, each of these SEZs have become textbook
examples of how fast free markets can transform both skylines and
the standard of living. Take for instance Shenzhen. Most people
have never heard of the former fishing village, yet over the past
three decades it has turned into a metropolis rivaling the wealth
and development of Western cities like Chicago or Paris.

These economic
powerhouses are fueled by laissez faire policies that much of the
West has given up on. Relatively low taxation coupled with a cheap,
deregulated labor force has turned China into the world's second
largest economy in less than three decades. Foreign investment
flows into the country at a rate unparalleled anywhere else in the
world in an attempt to capitalize in the largest urbanization transformation
(e.g., currently about 57% of the Chinese population still lives
in a rural setting and is expected to migrate substantially over
the coming decade).

In fact, Chinese
cities are choked with a never ending stream of rural peasants who
wish to pull themselves out of subsistence. Since 1981, some 600
million Chinese workers have
emerged out of poverty to seek a healthier, wealthier life within
urban cities. And as a result, China boasts not just a large share
of construction cranes in the world but internally consumes more
concrete than the rest of the world combined.
All in an effort to erect modern high-rises, mass transportation
systems, neck-bending skyscrapers, power plants, highways, airports
— or in short, everything it missed out on in the previous generation.
[19]

Shanghai's
new stock exchange even boasts listing from publicly traded toll
companies. Yes, while the West abhors at the notion of privately
built and maintained roadways, the major expressways that collect
tolls in China (more than 20) can be shorted or gone long like any
other security. [20]

Tens of thousands
of state-owned companies have been privatized over the past two
decades. By 2003, more than 25 million government workers were
given
the pink slip as their firms were reorganized, decentralized
— and right-sized. From the period of 1997–2002, the number
of state enterprises decreased from 262,000 to 159,000. Agencies
that were once part of the government fabric, the commanding heights
controlled by the state, have been restructured into publicly owned
firms (e.g., China Telecom, PetroChina).

One example:
August 24, 2005, China dumped
1,300 state-owned companies onto the stock market all at once –
$270 billion worth of assets. And with the freedom to succeed comes
to the freedom to fail — many of the firms have experienced less
than stellar returns. But that is not because capitalism has failed,
but rather the internal management practices and business models
are simply ineffective and unprofitable. Some have even — gasp
— gone bankrupt.

In contrast,
at the beginning of this year there are now more employees on US
government payrolls than on private. Government-sponsored enterprises
such as Fannie Mae and Freddie Mac have not only contributed to
a housing bubble, but have contributed significantly to a credit
crunch that has been temporarily
suspended by SEC commissioner Chris Cox — who effectively prevented
the short-selling of 19 firms including Fannie and Freddie.

Free-markets,
what free-markets?

And believe
it or not, China is party to seven Free-Trade Agreements. While
these certainly are from perfect nor are they pure free trade (I
have even criticized them in the past) it shows just
how far they have come from the days of being an isolated, protectionistic
land of communal farms. In contrast, members of Congress such as
Hillary Clinton recently railed
against free-trade agreements, including the failed Columbian agreement
for being too free, too liberal. Talk about a 180.

The pot
calling the kettle black

Perfect, no.
But China is definitely on the right track. And while China may
be the namesake for crunchy fortune cookies, the West may one day
be remembered as having gambled away its wealth by playing the lottery
on the back of each fable: your past success will overshadow your
future decline: 53 82 07 87 94 63 — the current cost, in dollars,
of the Iraq War.

Notes

[1] As of this writing there are 150,000
troops stationed in Iraq. They will remain at this level
for at least 45 days (u201Cthe pauseu201D). As of April 2008: there are
57,000 troops in Germany. 33,000 in Afghanistan. 33,000 in Japan.
27,000 in South Korea. 10,000 in the UK. 10,000 in Italy. 1,200
in Spain. And the seemingly never-ending list continues down
the line. Note: the US currently has five active Marine Expeditionary Strike
Groups each comprised of approximately 6,000 seaman and Marines.
In addition, the US has six Carrier
Strike Groups deployed, each comprising 10,000+ seaman and
Marines. The US government is also in
the process of building 50 permanent bases in Iraq. See also
statistics
from Global Security.

[2] According to the US Commerce Department (pdf) in
2006, U.S. exports grew by 12.7 percent over 2005 to $1.4 trillion.
During the same timeframe, foreign holders of US treasuries
increased their reserves by $100 billion (or a 7.5% ratio).
In the past year
alone, these same foreign banks gobbled about another $500 billion
– it’s hard to imagine that the US exported more than $500
billion in CPUs or cell phones.

Furthermore,
in 2004, the US exported $111 billion in goods to Mexico, and
sold $5 billion in US treasuries to it (year-on-year difference)
(pdf).
In 2004, while the US exported about twice as many goods to Canada
it also sold them $7 billion in US treasuries. In either case,
the largest single export to all countries is not automobiles
or TVs, but rather US treasuries. See also: u201CConcern
grows over a fiscal crisis for U.S.u201D by the San Francisco
Chronicle.

[3] John McCain wants
to add at least 90,000 soldiers to the Army and 30,000 more
Marines. Barack Obama, while discussing troops withdrawals from
Iraq, would like
to leave a u201Cresidual forceu201D of around 30–50,000 in Iraq and
deploy 2–3 more combat brigades to Afghanistan. See also,
u201CWhat
do Shimon Peres and Mitt Romney have in common?u201D

[4] Seymour Hersh noted that there is no oversight
regarding the $400 million appropriations for the CIA to conduct
covert warfare in Iran. Nor has Congress once stepped in to cancel
any funding or remove troops from the Iraqi theater — which is
under their legal jurisdiction. Other instances such as the Iran-Contra scandal
also come to mind.

[5] Fortunately not every uniformed officer is gun-ho
or sinophobic. USN Admiral Timothy Keating is spearheading humanitarian drills with Chinese
Lt. Gen. Zhang Qinsheng. It is hoped that this will lead to an
agreement similar to the 1972–3
accord between the USSR and US regarding conduct and communication
on the high seas.

[6] Regarding GDP numbers, it turns out that China
may have overstated the increase in GDP (1
2
3).
Furthermore, GDP is not necessarily the most accurate number to
gauge economic growth, see u201CWhat is up with GDP?u201D by Frank Shostak.
In addition, other measurements like CPI have been twisted in
the past.  In fact, "core" inflation was concocted
in the early '70s, by President Nixon who got then-Fed chairman,
Arthur Burns, to hide the effects of Nixon's inflationary policies.
See also: interview
with John Williams.

[7] Capital controls have recently
been liberalized. See also: u201CChina-Taiwan:
trade and prosperityu201D

[8] See also: u201CHow to Deal with a Threatening Islandu201D
by Joseph N. Potts.

[9] Instead the rescue effort was led in part by Blackwater, the
same unaccountable mercenaries that have killed hundreds of civilians
in Iraq and Afghanistan. See: u201CBlackwater
Downu201D and u201COverkill in New Orleansu201D both
by Jeremy Scahill.

[10] See: u201CA Flood of Follyu201D by Tim Kern, u201CHow the Market Might Have Handled Katrinau201D
by Robert Murphy, u201CFEMA
Should Be Shut Downu201D by Christopher Westley, u201CWal-Mart
at Forefront of Hurricane Reliefu201D by Michael Barbaro and Justin
Gillis, u201CMaking Hurricane Response More Effectiveu201D by Steve Horwitz
(pdf).

[11] While the PRC may not be fully open with the
official incarceration numbers, the United States has for the
past decade held the world
record for the largest prison population. As of February
2008, with 2.2 million adults – or 1 in 100 – the US
leads all
other countries, including China.

[12] The subways of New York and Washington D.C.
are now patrolled by men with automatic weapons. And in the UK,
the government plans
to monitor, record and store every digital artifact produced in
emails and phone calls.

[13] Over the past several years, the official One-child policy has
come under internal CCP scrutiny and may be liberalized within
the coming years. Furthermore, ethnic groups, parents that were
only-children, and various other exceptions are exempt from the
regulations and are not penalized for having more than one child.

[14] According to Just
Foreign Policy the number of Iraqi deaths is more than 1.2
million. According to Iraq Body Count — which only tabulates
deaths directly related to Coalition violence – the number
of civilians that have died is at least 86,000.

[15] See also: u201CCongress
votes to immunize lawbreaking telecoms, legalize warrantless eavesdroppingu201D
by Glenn Greenwald and u201CThe New FISA Compromise:
It’s Worse than You Thinku201D by Timothy Lee.

[16] How many permanent military bases has the PRC
erected across the globe? There is roughly the same amount of
Japanese military troops involved in world conflicts as Chinese
peacekeepers. Which one is supposed to be pacifist again?

[17] See also: u201CA Cold War in
Shangri Lau201D by Tenzig Sonam, "Democratic
Imperialismu201D by Michael Barker, u201CCIA's Secret War
in Tibetu201D by Joe Bageant, u201CTibet, the ‘great game’
and the CIAu201D by Richard Bennett.

[18] Dare I mention the institutionalized methods
of racial discrimination enforced by the US government prior to
the civil rights movements? Or wholesale theft of Native Indians
properties?

[19] As Dan Rather chronicles in his latest documentary on the
Discovery Channel, the Chinese want to live longer, healthier
and above all, richer lives.

[20] As noted in Jim Rogers book A
Bull in China: Jiangsu Expressway, Co., Zhejiang Expressway,
Co., Anhui Expressway, Co. See also “From
Mao to Wow!” by Kurt Andersen and “America
and China: The Eagle and the Dragon” by Mick Brown. For example:
Jiangsu Expressway, Co., Zhejiang Expressway, Co., Anhui Expressway,
Co.

July
22, 2008

Tim
Swanson [send him mail]
is a graduate of Texas A&M University and currently lives in
Seoul, Korea and enjoys kimchi and soju cocktail. Visit his blog.

DIGG THIS

If you are
an outspoken libertarian, odds are that someone has trenchantly
advised you to travel the world, to see why "America is so
grand."

However, the
underlying motivation for their sage wisdom is typically shrouded
in nationalistic rhetoric, to defend the state against your treasonous
attacks.

And this issue
is not necessarily a matter of foreign policy.

For instance,
one of my former roommates labels himself a fiscal conservative,
yet when I mentioned the defunding of NASA, he waxed on and on about
their technological contributions
to America. He finished by suggesting that I go see how the rest
of the developing world struggles to survive because their governments
failed to finance such innovative
and future-thinking agencies.

That's right,
the key to progress, economic growth, and a high standard-of-living
is a NASA in every nation-state. Why stop there and not erect a
NASA in every municipality?

Ignoring the
modern-day arguments for pyramid
building, perhaps there is something to this globe-trotting
perspective that Doug
Casey is missing.

Go West
Young man, Far West

In the middle
of the summer, I moved to Korea (the South of course). And if anything,
my libertarian convictions have grown stronger.

Many of the
conversations I have had over the last several months have been
illuminating.

For instance,
I have yet to meet a Canadian that is not proud of their national
health care system. Admittedly, they acknowledge that wait times
are much longer than those in the US, but gosh darnit, everyone
gets their equal chance at suffering. And according to them, that
is more important than independent, incentivized care.

Che shirts
are en vogue. In fact, aside from my history department,
this is one of the only places I have met die-hard, militant Marxists
and Trotskyites. Some knaves even long for the day when the South
becomes a socialistic paradise. Dare we ask who the cult of personality
will be? Rain?

And while
I am hardly the stereotypical, gun-toting Texan, a Scotsman I have
befriended recently admonished me for suggesting that when guns
are outlawed, the "good" law-abiding citizens are the
only people that turn them in. Furthermore, criminals will keep
them and know that they have a better chance at successful armed
robberies because MAD
deterrence is now a statistical whisker.

William Wallace
was certainly a fan of victim disarmament, no?

Because
it is fair, egalitarian and makes me feel warm and fuzzy

One of my former
coworkers is a diabetic and must take insulin shots several times
a day. Until the day he left, he was singing praises to the nationalized
health care system here in Korea, because it allowed him to purchase
his medical supplies and drugs at a rate far cheaper than what he
could in America.

However, this
is the classic case of the seen
and unseen. While my coworker does indeed obtain subsidized
health care that is seemingly cheaper, someone else is footing a
large chunk of the bill, namely, Korean taxpayers.

Not only that,
but one of the reasons medical care, drugs, and supplies are substantially
more expensive in America is due to stifling regulations and licensing
procedures that insulate incumbent providers (e.g., Big
Pharma, HMOs)
from outside competition.

Fool me
once, shame on you — fool me twice, shame on me

Despite the
vapid, foaming-at-the-mouth statism that some expats extol, the
ironic, yet unfortunate reality is that their ideas have all been
tried.

For instance,
while I have detailed
the corrupt, government-conglomerate system of chaebols, inefficient
unions still bully the show in many industries, including banks,
public education, manufacturing, shipyards, automobile factories,
steel mills, and most other blue-collar industries.

Heavy tariffs
insulate the car
and agriculture industry from foreign competition. Until recently,
a 100% tariff was placed on all imported cars and every vehicle
from Japan was permanently non grata. In fact, until
1998, importing music, movies, and video games from Japan was
banned carte blanche.

Similarly,
limited quotas are maintained for crops like rice. The loser in
both of these situations is the consumer, because they are essentially
forced to pay the rent-seeking prices charged by domestic providers.

And while the
controversial Free Trade Agreement will supposedly
remove some of the rampant protectionism, most of the industries
will still be managed and reregulated by the state.

Until last
year, movie theaters were required
to show domestically produced movies 146 days of the year, now
it is a mere 73 days. Could you imagine if American theaters were
legally required to show bombs like Gigli or Kangaroo Jack for that
amount of time? How do you say bankrupt in Konglish?

In an effort
to stymie overseas tourism, the Korean government is now
offering farmers tax breaks to build golf courses on their land.
Those involved in constructing them will receive subsidies and various
regulatory leniencies.

Of course,
the small little detail that goes unmentioned in those reports is
who ultimately finances the subsidies: Korean taxpayers. Also, why
not cut taxes across the board and put money back into the hands
of every citizen, who in turn has more to spend domestically?

North bad,
South good… right?

Unbeknownst
to most foreigners, for nearly 40 years, the South was essentially
run by one military dictator after another; its history is arguably
more tumultuous than the revolt-happy French.

In fact, Syngman
Rhee, the president of the First Republic was a megalomaniac
who was in some ways, no different than Kim Il Sung, his northern
counterpart (e.g., he single-handedly prolonged the Korean War by
refusing to sign numerous ceasefire agreements).

And while
South Korea is considered the "Miracle on the Han" (after
similar economic growth in Germany – "Miracle
on the Rhine"), historians often overlook that during the
20 years after the Korean War, roughly 60% of the foreign investment
came
directly from the US government (roughly $3 billion).

So
not only was the American taxpayer unwittingly forced into paying
for the bombs to level Germany and Korea, but they were also prodded
into reconstructing the ruined civilizations, brick by brick. (See
the Marshall
Plan.)

This list of
malfeasance is by no means exhaustive, however it can act as an
educational illustration: statism is statism, no matter what language
is spoken or where the sun rises.

November
1, 2007

Tim
Swanson [send him mail]
is a graduate of Texas A&M University and enjoys kimchi and
soju cocktail. Visit his blog.

DIGG THIS

Two decades
ago, Carl Sagan popularized the title of this essay; and yet it
remains as germane today as it did when he first coined it. (Though,
sociologist Marcello
Truzzi is said to have actually invented the original version
of the quote.)

From Little
Italy, With Love

During the
GOP debate on the evening of May 15th, former NYC mayor Rudy Giuliani
suggested that the Blowback
theory, as extolled by Congressman Ron Paul, was an extraordinary
claim.

However, to
the dismay of Giuliani, Paul’s statements come
straight out of the official 9/11 commission report.

For instance,
Chapter
2 holds many of the details that Paul tried to discuss at the
debate, and later articulated during the CNN
follow-up by Wolf Blitzer. It gives the historical background
of bin Laden, his motivations, and details the fatwa of grievances
against America.

Among other
notable assertions, bin Laden stated in the
second fatwa (1998),

For over
seven years now the United States has been occupying the lands
of Islam in the holiest of places, the Arabian peninsula, plundering
its riches, dictating to its rulers, humiliating its people, terrorizing
its neighbors and turning its bases in the peninsula into a spearhead
through which to fight the neighboring Muslim peoples.

The 9/11 commission
notes this kind of reasoning as one of many prior motivating factors
on that tragic day, and Ron Paul merely reiterated the fact.

So if you get
a chance between PTA meetings, soccer tournaments, and $9600/plate
fundraisers, give it a look-see — it is a surprising page-turner
(seriously).

Ballot stuffing

In both the
post-debate
interview with Hannity & Colmes, as well as analysis
from the likes of Michelle Malkin, one accusation (among others)
is that Ron Paul’s supporters are stuffing the ballot box; that
he is not a legitimate candidate.

Seeing as Fox
hosted the interviews, post-debate commentary, the debate, and the
poll itself, the easiest way to prove this assertion is to open
up the ballot box. Surely this could be done without a subpoena.
And curiously, none of the accusers have gone on record calling
for this to take place. Show us the chads.

Either way,
why isn't the same assertion being leveled at Mitt Romney, a mere
one-term governor of Massachusetts, who also consistently scores
high in online polls?

Paul can at
least claim to have enclaves of support from both the Libertarian
Party itself (having run for
president in 1988) as well as many libertarian and conservative
grassroots organizations around the country.

In addition
to serving ten terms, he has also written numerous books and hundreds
of articles and position papers discussing economics, foreign
policy, monetary
theory, and domestic
issues. Is his large readership base now disenfranchised? And
need I mention he has delivered several thousand babies — can those
families not be fans of his? Maybe not, but does Fox, or
anyone, have an accurate measure of Paul's support base?

Conspiracies
Schmiracies

As far as his
“fringe rhetoric,” if you have read anything recently written by
Ron Paul, or heard
his speeches at Congressional hearings or bill debates, none
of what he said at the debate was a new revelation. Nor is he the
only educated man publishing this viewpoint, as Chalmers
Johnson, Jim
Bovard, and Andrew
Cockburn have each discussed this issue at length.

And it was
apparent that all of the other candidates also seem to have ignored
the dozens of essays and speeches written
and delivered
by Paul over the past 10 years, many of which lambaste the shortsighted
foreign policies executed and promoted by the administration and
Congress.

In fact, in
a recent interview
with Tucker Carlson, Paul notes that as early as 1998 he was vocally
opposed to the invasion of Iraq vis–vis the Iraq
Liberation Act — as he saw nothing but animosity stemming from
its execution. And as recent as this past February he asserted
many of the same points that he would later reiterate on stage in
South Carolina.

Yet despite
errant claims to the contrary, Paul has gone on the record stating
that he does not blame the American populace for terrorist attacks,
rather he blames poor, historically
myopic foreign policies that motivated and inspired retribution
at a terrible magnitude.

An Inconvenient
Truth

Perhaps a subtler
reason for the visible negativity Fox and others have towards
Paul’s supporters is that Paulites operate outside their smug purview,
their gates, and ultimately their control.

And no better
is this best illustrated than talk-show host, Rush Limbaugh — who
recently
boasted on the air that he has the authority and power to anoint
the next GOP candidate.

Influence is
one thing, self-righteous grandiloquence is quite another.

Before
leveling anymore claims against a principled contrarian, bellicose
pundits and their sycophants should do their due diligence and find
extraordinary evidence. Or maybe just evidence in general.

May
21, 2007

Tim
Swanson [send him mail]
is a graduate of Texas A&M University and has never met Ron
Paul. Visit his blog.