“Nowadays to be intelligible is to be found out.” — Oscar WildeIn the wacky world of American politics, if you as an employer have a religious objection to paying for your employees’ contraceptives, it is you who is contemptuous of religious freedom.As the New York Times editorial board lectured a judge who thinks otherwise, “the […]
Socialism is the big lie of the 20th century. While it promised prosperity, equality, and security, it delivered poverty, misery, and tyranny. Equality was achieved only in the sense that everyone was equal in his or her misery.In the same way that a Ponzi scheme or chain letter initially succeeds but eventually collapses, socialism may […]
Six months ago, I stepped out from the shadows of the United States Government’s National Security Agency to stand in front of a journalist’s camera. I shared with the world evidence proving some governments are building a worldwide surveillance system to secretly track how we live, who we talk to, and what we say. I […]
I opened a new bottle of probiotics this morning, and it had one of those circular seals on the top. You know, the one that reads, “Sealed for your protection.”And that seal got me thinking… how much protection do we need? How much security is enough?How much homogenization, pasteurization, disinfection, national security, etc…. do we […]
Last spring, Barack Obama told the graduating class of Ohio State University:“Unfortunately, you’ve grown up hearing voices that incessantly warn of government as nothing more than some separate, sinister entity that’s at the root of all our problems… They’ll warn that tyranny is always lurking just around the corner. You should reject these voices. Because […]
In the Huffington Post last week, Glenn Greenwald, Slate contributor Ryan Gallagher, and Ryan Grim had an investigative piece reporting that the NSA had been tracking the online porn-viewing habits of several Muslim leaders whom it viewed as radicals. A top-secret document shows that the agency was considering exposing these firebrands’ Internet dalliances as a […]
Americans are still trying to get a handle on the full extent of the government’s domestic spying activities, including the recent revelation that the National Security Agency (NSA) has been collecting and storing the email address books of ordinary Americans using online messaging services. Many users of such services are looking to tech executives for […]
A few months ago at a demonstration against the president of Montreal, Maine and Atlantic Railway, a Canadian citizen made the following claim: “We don’t have guns, we are not Americans, we are civilized.” A few days before, in early July, a train of the company had run away and exploded in Lac-Megantic, Quebec, killing […]
From the Tongue-In-Cheek Department of Laissez Faire Books…Washington, D.C. — Sen. Dianne Feinstein (D-CA), chairman of the Senate Intelligence Committee, announced that her committee will hold a “major review into all intelligence-collection programs.” This surprising declaration followed the revelation, through documents leaked by government whistle-blower Edward Snowden, that the NSA has been listening to the […]
From the Tongue-in-Cheek Department of Laissez Faire Books…Washington, D.C. – The complex negotiations aimed at bringing a long-term solution to the federal government’s expenditure and debt problem have produced an unconventional proposal. “Although the solution only focuses on a tiny fraction of government expenditures,” declared President Barack Obama, “it is a step in the right […]
I’ve just spent a harrowing weekend reflecting on Thomas Paine’s Common Sense, the pamphlet that came out in January 1776 and turned the public toward seeking independence from Britain. I say harrowing because the distance between the ideals found in this pamphlet and those of today’s America is so vast as to be nearly unrecognizable.The […]
It was a wild ride last week in the world of the Deep Web, that section of the Internet that requires special tools to access. The feds took down the site called Silk Road and claim to have arrested its founder and administrator. The news streams were filled with lurid tales of derring-do in this […]
Want to know just how invasive the state is going to get in the United States?Well, take a look across the pond.In terms of the large, invasive state, we English are way ahead of you guys. We’re a good 50 or more years further down the road to serfdom.Nineteenth-century Britain was about as glorious a […]
A tense drama unfolded this week with the virtual shutdown of vital government agencies: the Commodity Futures Trading Commission, the Consumer Financial Protection Bureau, the National Labor Relations Board, the Equal Employment Opportunity Commission, as well as many other such federal agencies. Without them, the Founding Fathers could not have imagined the republic.Even if fewer […]
Three months after Edward Snowden’s leaks began to reveal the extent of the U.S.’ mass surveillance program, “serious people” are beginning to make the case that it’s time for the outrage and indignation to subside and give way to a “national conversation” about the future of surveillance. So has the moment come for us to […]
A sixth-grader has been suspended for drawing an inappropriate picture. The drawing did not include any gun, but showed a checkpoint backed up by a SWAT team carrying flower pots while an unarmed drone hovered above.The suspended girl, whose name is kept secret at the request of her family, said she “just wanted to draw […]
The second part of this two-part article reveals an untold part of the story about how they were stopped last time. And shows how, if not again stopped, how it could lead to a fundamental loss of civil rights and freedom on the Internet.The offending legislation was barreling down the track, seemingly — even in […]
Two years ago, Hollywood, no kidding, masterminded a plot to, in effect, steal the Internet (by criminalizing certain conduct, booby trapping the Web in ways that few non-mega-corporations could cope with). There are signs, as perceptively flagged by the Electronic Frontier Foundation, that the perps are back at it. We should care.This two-part article reveals […]
It has now been nearly two centuries since French political scientist Alexis de Tocqueville visited America and compared American democracy to the French variety. The Martian asked his Earth correspondent to redo the comparison.The typical Frenchman thinks that Paris is the center of the universe, life without a baguette is not worth living, France is […]
I was at the Canadian border, headed toward the freedom that exists a few feet beyond the last security check. I was gently waved down a side corridor.Ninety minutes later, I was let go, but not before something truly alarming happened. I’m pretty sure that the Canadian government captured a mirrored version of my smartphone […]
Fort Meade, MD – The United States, the least unfree country on Earth, is fighting a major invasion of the Blueshirts.The most visible Blueshirts constitute a 50,000-plus army that occupies all the airports in America. Recognizable by their blue shirts and their inquisitive eyes and hands, they search and humiliate all Americans trying to leave […]
Sometimes, the news of the day causes me to say, “Huh?” The New York Times revelations last month about NSA programs and activities to enhance the agency’s ability to spy on ordinary citizens prompts today’s “Huh?” Who knew that our every phone call, Internet post and tweet is being recorded by the government?I have operated […]
U.S. and British intelligence agencies have successfully cracked much of the online encryption relied upon by hundreds of millions of people to protect the privacy of their personal data, online transactions and emails, according to top-secret documents revealed by former contractor Edward Snowden.The files show that the National Security Agency and its UK counterpart GCHQ […]
Oh, how the media love a good strike. Look at these fast-food workers and peasants standing up to the owners of capital! They aren’t going to take the oppression anymore. The suits in the boardrooms had better shape up and stop hoarding all that money. They need to give it up to the men and […]
Like all great historical ideas, the project of licensing journalists so that they may benefit from the First Amendment was born in a very modest place. In fact, it began in the most modest of all places: the brain of Dianne Feinstein, U.S. senator from California.The new law, which was just adopted by Congress and […]
The position that there need be a state is too often taken for granted.The main body of Sartwell’s book Against the State is dedicated to destroying the arguments for a state from the likes of Hobbes, Rousseau and Hegel. In fact, one thing that becomes crystal clear in reading Sartwell’s book is how bad the […]
Crispin Sartwell is someone you should know. He is doing important work in recovering forgotten greats in America’s anti-authoritarian tradition. Among other works, he’s put forward a lean and powerful book titled Against the State.In what follows, you’ll see why he’s my favorite living philosopher. Sartwell will take you on an intellectual tour de force […]
To do serious business in America requires vast campaign contributions to several layers of elected politicians, an army of lobbyists in Washington, retired government employees on your board and public devotion to the American civic religion. It goes on every year and restarts every election cycle.
Even then, it is hard to know if you are going to get what you pay for.
It’s easier and more efficient in Mexico. You pay bribes directly. The decision maker gets the money. He or she clears the path for you to do the thing. The facilitator takes a slice. People mostly keep their promises. The deal is done.
Apparently bribe paying in the United States is a sign of a healthy, functioning democracy; doing the same thing in Mexico in a more streamlined way is a criminal violation of the standards of good corporate governance.
Here we have the New York Times “exposing” the shocking and presumably ghastly fact that over several years, Wal-Mart paid out some $24 million in payoffs to politicians, bureaucrats and petty gatekeepers in Mexico, all in the hope of employing people who need jobs and bringing goods and services to those who need them.
The breathless and bloviating Times expose is written as if these intrepid reporters were exposing a violent mob engaging in killings to get its way. You never quite get that Wal-Mart would much rather have used the money to expand its business, hire more employees or beef up its inventory. Money used for bribes is a loss to any company, a terrible price of doing business under the state.
In any case, the trove of information was shoveled on the paper by disgruntled employees. And it is hardly unusual. It’s how business is done. Regardless, the Times is out for blood — not from the extortionists who run the system but from the victim, Wal-Mart.
Last count, there were 1,200 news stories about this on the wire. Forbes reports: “Wal-Mart Stores will likely face the wrath of the U.S. Department of Justice for reining in an internal investigation into bribery allegations at its Mexican subsidiary.”
I’m sure that congressional investigations are around the corner, with all the named executives hauled before committees and harassed by regulators.
The bitter irony is that it will transfer more of the Mexican system to the U.S. To survive, Wal-Mart will be forced to spend more than the $12 million-plus it already spends every year on campaign contributions and lobbying.
All that enforcement of the Foreign Corrupt Practices Act (FCPA) does is increase the amount of domestic corrupt practices. Indeed, that is the way the system is supposed to work. Truly, if the FCPA were actually enforced as written, business around the world would come to a grinding halt.
Under the well-known Mexican system, people called “gestores” specialize in interfacing between business and bureaucracy. They deal with inspectors, permit issuers, environmental bureaucrats, labor officials and zoning regulators. If the gestores can make the deal, they keep 6% as a matter of convention. Even average citizens use these people to stand in line for them — all in an effort to find non-violent means around the bureaucrats.
Given the ridiculous barriers in place, it’s not a terrible system. Corrupt government that you can buy your way around is far better than “good government” that blocks all progress.
The rap on Wal-Mart is that it did far worse. When the company discovered this was going on, it buried it, rather than going public. No kidding. Maybe the company imagined that it would be smeared and attacked?
Bribing officials is illegal in Mexico, just as it is in the United States. But of course, that is just the gloss. Anywhere there is government, there is corruption. That’s the purpose of barriers to enterprise, to extract wealth from those who want to get past them.
Is it worth it? It is either pay or don’t do business, which means lasting poverty. Today, Wal-Mart Mexico employs 209,000 people and is the country’s largest employer. It has provided a fabulous example of the merit of private enterprise in this country, which is finally getting on its feet economically. It has brought food, goods and services to millions of people who otherwise would not have them. It has done more in 10 years for Mexico than all the government bureaucrats have done in one hundred or a thousand years.
For its crime of bringing economic development to this country, it must be smeared, beaten and forced to pay obeisance to the American political class. Why should Mexico enjoy such largess when there are millions of American bureaucrats who need to be part of this gravy train?
You can read thousands of academic papers on the problem of “corruption” in countries around the world and completely miss the central point. The way to eliminate the corruption is to eliminate the barriers to enterprise. Why is this not obvious? Because many people imagine a utopian ideal that does not now and never has existed: good government. They imagine that government rules can be enforced impartially based on science or the public good.
It’s sheer nonsense. As Ludwig von Mises wrote in Human Action in 1966:
“Unfortunately, the office-holders and their staffs are not angelic. They learn very soon that their decisions mean for the businessmen either considerable losses or — sometimes — considerable gains. Certainly, there are also bureaucrats who do not take bribes, but there are others who are anxious to take advantage of any ‘safe’ opportunity of ‘sharing’ with those whom their decisions favor… Corruption is a regular effect of interventionism.”
But here’s the part that upsets me so much. Somehow, private enterprise is always and everywhere blamed for perpetuating it, when the truth is obviously that the blame rests with government. It’s like watching a mugging and blaming the mugged for carrying too much money with him. It’s like telling anyone who has faces the demand “your money or your life” should always choose to give up his life.
The background here is nothing short of anti-capitalist resentment. The elites loathe Wal-Mart for its achievement in putting on display the incredible reality about capitalism that you never hear about in school: It is a system that is maniacally focused on the well-being of society in service of the common man.
Go to Wal-Mart, and you see the workers and peasants not rebelling against the system, but buying stuff that makes their lives better. It looks rather mundane. It’s how civilization is built: one economic exchange at a time. The people who stand in the way don’t deserve a dime, but private enterprise is kind enough to cough it up, anyway. Wal-Mart deserves sympathy, not condemnation.
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