More Crazy in the LP

It does the future of libertarianism no good, and much harm, when libertarians attempt to prove their own insanity through public statements of the most absurd kind. Too many of these loons are now associated with the Libertarian Party and the Party deserves the death spiral it is in as a result.

Consider the Libertarian Party of Alaska, once a party of relatively sane individuals who actually managed to win seats in the state legislature.

Republican Senator Lisa Murkowski is trailing an opponent in the vote count for the Republican primary. The Anchorage Daily News reports:

There is a possibility that Murkowski could run on the Libertarian ticket in the November general election if she loses the Republican primary. The Alaska Libertarian Party is discussing the possibility and its Senate candidate, David Haase, has said he is open to talking to Murkowski about him stepping aside.

Apparently the LP remains an option for has-been Republicans, which effectively dooms it and prevents it from taking a truly libertarian position, as it is a sanctuary for unemployed conservatives.

As bad as this may be it seems the Libertarian Party's current candidate for U.S. Senate is actually even worse. He's a conspiracist of the mentality of the Birch Society. The paper reports that LP candidate David Haase would consider stepping aside for the losing Republican but says he "would surely press Murkowski on the Federal Reserve, which is his focus. 'Let's take the Federal Reserve, nationalize it and take that income earning capacity and turn it over to the people to finance Social Security and Medicare."

What we have here is bad thinking squared. Haase holds several viewpoints simultaneousl—all of them wrong. He has been reading the bullshit from books like The Creature from Jeykl Island or perhaps even worse, the rantings of Eustace Mullins. Haase manages to combine the insanity of Birch Society conspiracy theory about the fed, with Marxist sounding rhetoric about nationalizing what is fundamentally a national institution already.

There are member banks to the Fed but the politicial powers in Washington ultimately control the Fed. As for this "earning power" where does he think the "profits" are going today? The Fed doesn't make much in the way of profits and what profits there are go to the federal government already.

Member banks simply have no control over monetary policy, which is the major function of the Fed. What member banks do is manage the day-to-day workings of the system at the local level. Policy is determined by the Board of Governors of the Fed all of whom are political appointees.

As for the crazy that the Fed could fund Medicare and Social Security consider the "profits" of the Fed. The Fed buys government bonds which pay interest. So the government pays interest to the Fed, as it would to anyone who owns the bonds. A substantial portion of the interest paid the Fed on those bonds is then given back to the government already. What is paid out to member banks is a relatively small portion of Fed income and well below what would be necessary to fund a highway expansion, let alone fund Social Security and Medicare together, or alone.

Then consider this "libertarian" solution to "nationalize" the Fed. Even if the Fed were private nationalization is a socialist viewpoint not a libertarian one. Nationalization likek this tends to be the view of Marxists and conspiracy cranks. The "free banking" alternative has historically been what libertarians prefer. Of course, I contend that what is happening to the LP is that is serving as a retirement center for disaffected conservatives, John Birchers and Tea Party crazies. It is no longer a home for libertarians but a refuge for every Right-wing crank in America. A lot of the bad thinking about the Fed comes from them.

Haase manages to combine numerous false premises into one sentence. Consider them:

1. The Fed is, for all practical purposes, already nationalized.
2. Even if the Fed were truly private, nationalization is not a libertarian solution.
3. Even if the Fed were private, and if nationalization were a libertarian option, then the "profits" would NOT fund Social Security or Medicare.

The talking points used by Haase are pure right-wing crank theory, they are not factually accurate, historically accurate, or even libertarian.

Here is an excellent talk on the Federal Reserve by Steve Horwitz. Steve explains the real problems with the Fed, which have little to do with the Bircher type thinking that is being promoted by the Right. In fact, I would argue that the conspiracist theories about the Fed actually insulate the Fed from valid criticism. If people focus on non-existent problems they do so to the exclusion of real problems. The conspiracist theories of the Fed are relatively easy to debunk which makes it appear that the Fed is actually a good idea. The focus ought to be on the real problems with the Fed, not the fantasies of the Right. Steve's video lecture is about 90 minutes but well worth watching.