Monday, November 30, 2009

Probability and age

My birthday is just around the corner. It's a time for family, fun, and cake -- lots of cake. It is also a time for a quick look at the CSO mortality tables (available online).

The tables -- used in insurance and other areas -- provide a value that reflects deaths per 1000 policy holders, depending on age, sex, and smoking status. With little difficulty, I found my value.

Luckily, I am still at a less than 1 death per 1000 mortality rate ... whew ...

Nevertheless, a question remains: What is my probability of dying within the next 12 months?

Is the answer simply the rate found on the table for male, nonsmokers (blended rate since the age in the table is an issue age, which changes six months before the actual date of birth)?

The answer depends on your view of probability. If you take the standard view of probability, your answer is yes -- the rate is my probability of dying. If you take a frequency view of probability, your answer would be much different. You would state that my probability of dying is either 100% or o%. And we will not know the answer until the year is over (though God knows now).

Is this just esoteric nonsense? Not at all. Your view of probability drives how you perceive statistical conclusions. It helps you separate the statistical chaff from the statistical wheat

Note: I take a frequentist view of probability. So I'll let you know next year what my actual qx (mortality rate) was for this year. Or, just maybe, I won't.

Sunday, November 29, 2009

What is science?

Is it immutable truth? Not so. As Stephen Hawking explains, "No matter how many times the results of experiments agree with some theory, you can never be sure that the next time the result will not contradict the theory."

At best, science is nothing more than the closest correlation known between natural phenomenon.

Yet many assume that science is law; that science is without bias or error. They assume this to be so since that is how science is portrayed in most schools and universities. Once scientists speak, alternate theories or ideas are to be cast aside -- they are now archaic and foolish.

But such is not science. Science proves nothing, and so must be always open to retesting of old theories. Science is never settled -- in spite of what Al Gore states.

Consider a tool used in scientific investigations: statistics. There are two layers to statistics, there is probability and there are statistical equations.

The concept of probability is still open to debate -- learned and reasonable minds do not agree on what constitutes a true probabilistic statement. Yet scientists (as well as many others) plug datasets into statistical equations and claim the results to be truth.

However, this is akin to entering an address into the name field of a computer program and claiming that, since the program didn't error, what you entered must be a name.

Just because the equation, program, or model can process the data, does not mean the results are true.

Consider this syllogism: All readers of this blog are Steelers fans. You are a reader of this blog, Therefore, you are a Steelers fan.

The syllogism is correct as far as logic is concerned -- the conclusion follows from the major and minor premises. But the major premise is likely not true -- I'm almost certain that at least one reader of this blog is not a Steelers fan. If the major premise is not true, there is no way to claim that the conclusion is true (based on the major premise, of course).

Logic works, but does not always provide conclusions that are true -- meaningful in a real world sense.

Once you go beyond the trivial, science isn't even close to being settled (true science, that is). And the more we learn, the more we realize we don't know.

Earlier this year, Jym Ganahl (a trusted, local meteorologist and TV weatherman) spoke at a meeting I attended. He noted that, as a group, meteorologists do not support the supposed science of human-induced global warming. Oh, sure, climate is changing -- it always is. But there is no proof that man is causing that change.

The global warming debate is not settled -- sorry Al. Although the climate change debate is settled -- our climate is changing, it always is.

Finally, a letter in today's edition of The Columbus Dispatch claimed that science is truth -- and this coming from a writer who identified herself as a former scientist. When you read such nonsense, consider Hawking. Science can never define truth. Never.

Note to my Christian brothers and sister: There is only one Truth, and it is found in the Bible. Do not be taken in by the allure of science (or, as FA Hayek termed it, scientism). Science is not truth. And that is a statement that any good scientist (typically defined as a scientist that is not dependent on the state for funding and support -- he who pays the piper ...) would accept.

Note: Read Karl Popper, Thomas Kuhn, FA Hayek, Richard von Mises, Ludwig von Mises, et al, to enrich your understanding of science. At a later time, I will address the apriori sciences. From these, truth can be ascertained -- truth that is supported by the Bible, of course.

PS: Since I am my own editor, I tend to revise posts after some time and thought. As someone born in Pittsburgh, it is really hard for me to write Steelers fan instead of Steeler fan. If you are from western PA, you would understand.

Saturday, November 28, 2009

Falsification and science

Karl Popper -- widely regarded as one of the greatest philosophers of science of the 20th century -- claimed that only statements which are falsifiable can be considered scientific. So, a theory should be considered scientific if and only if it is falsifiable.

Now, consider global warming -- er, climate change. By Popper's definition, global warming cannot be science since its claims are unfalsifiable. The so-called science of global warming cannot be contradicted. Even evidence that obviously refutes its claims is disregarded -- the evidence is already incorporated into global warming.

At its most absurd, show that temperatures are going down and the adherents of global warming say that the lower temperatures are the result of global warming. It's almost Marxian in its nonsense.

In the end, global warming is something other than science. For many, it's another means to destroy man. For others, it's the ploy that will lead to riches. And for the politicians, it's one more crisis that can't go to waste.

note: Even while the global warmists are playing the adult masses, the public schools are indoctrinating the next generation. (HT

Thursday, November 26, 2009

FFF and a really good point

Albert knocks this one on the head. -- Jim

From a recent edition of the Email Update from the Future of Freedom Foundation:

Monday, November 23, 2009

For forty years now, I have been putting the one question to reformers, planners, single-taxers (one of which I am), socialists, etc., etc., and never got an answer: 'Suppose you got your system all set up, what kind of people can you get to administer it except the kind you've got?"
— Albert Jay Nock, Selected Letters of Albert Jay Nock

Wednesday, November 25, 2009

Dave King thanks his friends

In this week's edition of ThisWeek Olentangy, newly elected school board member Dave King has a letter thanking his friends. His friends?!? Isn't that what he plans on doing after he is sworn in?

And I bet King has a lot of friends that he plans on thanking -- or a few friends that he plans on thanking a lot (keep in mind that King makes his living [inter alia] by getting contracts from various local governments).

Folks, hold onto your wallet -- King is on the board.

Note: By thanking his friends, King sounds like he just won election to high school student council -- and his friends are about to get the choice photos in the yearbook (Ok, mixing two high school offices, but you get the point).

Tuesday, November 24, 2009

A Thanksgiving Day story from The Independent Institute

From The Independent Institute

The Pilgrims’ Real Thanksgiving Lesson
November 25, 2008
Benjamin Powell

Feast and football. That’s what many of us think about at Thanksgiving. Most people identify the origin of the holiday with the Pilgrims’ first bountiful harvest. But few understand how the Pilgrims actually solved their chronic food shortages.

Many people believe that after suffering through a severe winter, the Pilgrims’ food shortages were resolved the following spring when the Native Americans taught them to plant corn and a Thanksgiving celebration resulted. In fact, the pilgrims continued to face chronic food shortages for three years until the harvest of 1623. Bad weather or lack of farming knowledge did not cause the pilgrims’ shortages. Bad economic incentives did.

In 1620 Plymouth Plantation was founded with a system of communal property rights. Food and supplies were held in common and then distributed based on equality and need as determined by Plantation officials. People received the same rations whether or not they contributed to producing the food, and residents were forbidden from producing their own food. Governor William Bradford, in his 1647 history, Of Plymouth Plantation, wrote that this system was found to breed much confusion and discontent and retard much employment that would have been to their benefit and comfort. The problem was that young men, that were most able and fit for labour, did repine that they should spend their time and strength to work for other men’s wives and children without any recompense. Because of the poor incentives, little food was produced.

Faced with potential starvation in the spring of 1623, the colony decided to implement a new economic system. Every family was assigned a private parcel of land. They could then keep all they grew for themselves, but now they alone were responsible for feeding themselves. While not a complete private property system, the move away from communal ownership had dramatic results.

This change, Bradford wrote, had very good success, for it made all hands very industrious, so as much more corn was planted than otherwise would have been. Giving people economic incentives changed their behavior. Once the new system of property rights was in place, the women now went willingly into the field, and took their little ones with them to set corn; which before would allege weakness and inability.

Once the Pilgrims in the Plymouth Plantation abandoned their communal economic system and adopted one with greater individual property rights, they never again faced the starvation and food shortages of the first three years. It was only after allowing greater property rights that they could feast without worrying that famine was just around the corner.

We are direct beneficiaries of the economics lesson the pilgrims learned in 1623. Today we have a much better developed and well-defined set of property rights. Our economic system offers incentives for us—in the form of prices and profits—to coordinate our individual behavior for the mutual benefit of all; even those we may not personally know.

It is customary in many families to give thanks to the hands that prepared this feast during the Thanksgiving dinner blessing. Perhaps we should also be thankful for the millions of other hands that helped get the dinner to the table: the grocer who sold us the turkey, the truck driver who delivered it to the store, and the farmer who raised it all contributed to our Thanksgiving dinner because our economic system rewards them. That’s the real lesson of Thanksgiving. The economic incentives provided by private competitive markets where people are left free to make their own choices make bountiful feasts possible.

Powell is Research Fellow at The Independent Institute ,assistant professor of economics at Suffolk University and a Senior Economist with the Beacon Hill Institute. Dr. Powell received his Ph.D. in economics from George Mason University. He has been assistant professor of economics at San Jose State University, a fellow with the Mercatus Center's Global Prosperity Initiative, and a visiting research fellow with the American Institute for Economic Research.
Full Biography and Recent Publications
This article was originally published in November 2004. It ran in the San Diego Union-Tribune and Charlotte Observer.

Sunday, November 22, 2009

Dianetics in education

You have to read this nonsense to believe it. It's sort of like reading Dianetics or similar mishmash. But, and this is big, unlike the Dianetics mishmash, this nonsense IS the nonsense that is taught to educators, who bring it into your child's classroom. -- Jim

From the Marxists over at TCRecord, the propaganda arm of the Teachers College of Columbia University:

Culturally Responsive Mathematics Education

reviewed by Kathleen Nolan — November 02, 2009

Title: Culturally Responsive Mathematics
EducationAuthor(s): Brian Greer, Swapna Mukhopadhyay, Arthur B. Powell, and
Sharon Nelson-Barber (eds.)
Publisher: Routledge, New
ISBN: 0805862641,
Year: 2009

As I pondered the title of this admirable collection of essays, I could not help but ask the pertinent question at hand: What, exactly, is meant by (a) culturally responsive mathematics education? Decidedly, this is precisely the question addressed by each of the chapter authors, albeit in ways that are embedded in stories of identity, cultural artifacts, curriculum development, social justice, computer design, semiotics, the environment, and the historical, anthropological, and highly politicized perspectives on mathematics as socially and culturally constructed. I quickly discerned that such a diverse collection of perspectives focused on the topic of diversity does not readily lend itself to a cursory review process— striving to
encapsulate the flavor of a rich text such as this in 1500 words or less is akin, I suppose, to striving to encapsulate what it means to be culturally
responsive in mathematics education in 370 pages or less!

FFF and Shanker

And he was right. -- Jim

From a recent edition of the Email Update from the Future of Freedom Foundation:

Thursday, November 19, 2009

It's time to admit that public education operates like a planned economy, a bureaucratic system in which everybody's role is spelled out in advance and there are few incentives for innovation and productivity. It's no surprise that our school system doesn't improve: It more resembles the communist economy than our own market economy.
— Albert Shanker, President of the American Federation of Teachers

Saturday, November 21, 2009

Educational relativism

The Ohio School Boards Association is the lobbying arm of Ohio's public school districts. In the note below, OSBA defines its position as one of money -- their position is simply relative to the amount of state tax dollars appropriated.

For OSBA and the rest of the educationists, progressive nonsense is never morally or ethically wrong, it's only underfunded.

-- Jim

From OSBA's Facts in a Flash:

Healthy Children, Healthy Choices Legislation

Both the Ohio House (HB 373) and Ohio Senate (SB 210) are proposing bipartisan bills that would establish nutritional standards for certain foods and beverages sold in schools; require public school students to have periodic body mass index measurements; and require daily physical activity for students. Both bills are being strongly supported by the Ohio Business Roundtable and other health care advocates.

Specifically, the bills would:

  • Require that schools provide 30 minutes of physical activity for students each day.
  • Increase required physical education time for high school students from a half-unit to a full unit, and ensure that teachers are licensed in physical education.
  • Require that schools offer more nutritious food and beverages in vending machines and on menus.
  • Require body mass index screenings for students entering third, fifth and ninth grades, educate parents about the results and post aggregate results on district report cards.
  • Increase access to free breakfast for students who qualify. OSBA is working with other interested parties on the legislation.

We have expressed some concerns regarding how the proposal would be funded and how districts would fit the new requirements into an already crowded school day.

It's looking to be an FFF weekend

Sad, but true. -- Jim

From a recent edition of the Email Update from the Future of Freedom Foundation:

Friday, November 20, 2009

For the majority of people liberty means only the system and the administrators they are used to.
— Albert Jay Nock, Selected Letters of Albert Jay Nock [1962]

Friday, November 20, 2009

FFF and Mises

From a recent edition of the Email Update from the Future of Freedom Foundation:

Tuesday, November 17, 2009

It is important to remember that government interference always means either violent action or the threat of such action. The funds that a government spends for whatever purposes are levied by taxation. And taxes are paid because the taxpayers are afraid of offering resistance to the tax gatherers. They know that any disobedience or resistance is hopeless. As long as this is the state of affairs, the government is able to collect the money that it wants to spend. Government is in the last resort the employment of armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential feature of government is the enforcement of its decrees by beating, killing, and imprisoning. Those who are asking for more government interference are asking ultimately for more compulsion and less freedom.

— Ludwig von Mises, Human Action [1949]

FFF and Pascal

Old words of wisdom from a recent edition of the Email Update from the Future of Freedom Foundation:

Wednesday, November 4, 2009

Can any thing be more ridiculous than that a man has a right to kill me because he dwells the other side of the water, and because his prince has a quarrel with mine, although I have none with him?
— Blaise Pascal, Pensees, IV [1670]

There has to be more here ... there just has to be

But, I guess it ends with this. -- Jim

From The Columbus Dispatch

Delaware County jail director resigns
Friday, November 20, 2009 4:29 PM
The Columbus Dispatch

DELAWARE, Ohio The director of the Delaware County jail resigned today after admitting to using his personal cell phone to take and send inappropriate photos to a female employee, Sheriff Walter L. Davis III said.

Christopher L. Smith, 34, took one of the images while he was on duty and dressed in uniform, Davis said.

Smith sent the photos to a woman who worked for a company that provides health-care services at the jail. The woman no longer works at the jail, but the sheriff said he did not have details on her employment status because she is not a county employee.

Smith had been on paid leave since Nov. 9 and was being investigated for violating office policies concerning non-discrimination and harassment. Smith resigned today during a meeting the sheriff had arranged to discuss the results of an internal review.

"He felt disappointed in himself and felt that he had let down the office," Davis said.

In his resignation letter, Smith said he resigned with deep regret and thanked Davis for "the challenges and life experiences" he gained at work.

The administrative investigation found that Smith violated the office's code of conduct but did not warrant a criminal probe, Davis said. He first learned of Smith's alleged misconduct through an anonymous complaint to the county commissioners.

"The citizens of Delaware County deserve public servants who represent the mission of our office," Davis said. "The office cannot and will not tolerate employees who exhibit a lack of judgment while on duty."

Smith could not be reached for comment. He joined the sheriff's office in March 2008, and previously worked for the Morrow County sheriff's office for 10 years.

Thursday, November 19, 2009

Out of a bad movie

Like one of those silly sci-fi flicks, where the aliens need to dwell in the bodies of humans in order to rule the world, the foul-smelling aliens -- who already have Hanks and Thompson under their control -- need to inhabit the corpus of O'Brien in order to rule Delaware County.

Ken, it's all a mind game. Luckily, Tweedles Dee and Dum have little in the way of mind power.

Note: Oh, and stay out of offices when univited. That's tough to defend.

From the Delaware Gazette:

Commissioners: Efforts to set up dispute resolution stalling
Thursday, November 19, 2009


Staff Writer

More than four weeks after initially voting to do so, Delaware County commissioners are still trying to set up a meeting with a state dispute mediator they hope will address interpersonal problems on the board.

An official with the Ohio Commission of Resolution Dispute has contacted all three county commissioners, but commissioner Ken O’Brien said he won’t meet unless a specific issue is identified for the commissioners to talk about.

“I don’t want everybody to sit down in a room if we’re going to say ‘What are we going to talk about?’” said O’Brien, who voted against bringing in the mediator in the first place. He said he is waiting to hear back from the state mediator after she again contacts the other two commissioners.

Commissioner Todd Hanks said he hopes O’Brien gets on board with the mediation program.

“I think if it were to move forward, it would be in the best interest that all three would participate,” Hanks said.

On Oct. 29, Hanks and commissioner Tommy Thompson voted to bring in the mediator. Thompson said at the time he hoped it would help address lingering distrust over a controversial $3.13 million consulting contract that the commissioners passed over the summer before later rescinding it.

O’Brien has said he was not included on some e-mail communications related to the contract, and feels like the other two intentionally kept him out of the loop. O’Brien subsequently issued a broad records request for all emails between the commissioners and the prosecutor’s office, an action which the other two commissioners criticized as divisive.

O’Brien said the $3.13 million contract is now largely water under the bridge, but an incident that occurred the day after the vote to bring in the mediator might highlight some distrust that still exists between O’Brien and the other two commissioners.

On the evening of Oct. 30 after regular office hours, county economic development director Gus Comstock returned to his office to find O’Brien inside with the light off.

O’Brien said he went to talk to Comstock, and when he didn’t find him, he looked on his desk for economic-related information.

Afterwards, O’Brien said he may have made things worse by defending his right to be in the office in the first place.

“If I wanted to go into that office, I don’t have a problem with that, because (Comstock reports directly to the commissioners), and I said that,” O’Brien said. “But that doesn’t mean I’m going to go through his stuff, and I haven’t.”

Comstock declined to comment for this article, but some in the commissioners’ office view the incident as an intrusion and a violation of professional courtesy.

Thompson said after hearing about the incident, he began locking his office door when he leaves, something he didn’t do before.

“My personal opinion is that kind of action is unethical,” he said. He added he would leave a note behind if he were looking for someone in their office and they were not there, rather than look through their desk without permission.

Regardless, Thompson said he hoped bringing in a mediator would help the commissioners hash out some of their issues.

“I don’t want us all to be a bunch of rubber stamps … but I want us to communicate with each other and work together, and not be suspicious
of each other’s motives,” Thompson said.

Thompson also said he doesn’t think the commissioners should “berate or belittle” anyone in public sessions. He didn’t identify O’Brien by name, but he was referring to a few recent occasions where O’Brien’s directed pointed questions toward lawyers representing companies looking to do business with the county during public meetings.

O’Brien responded by saying he was simply asking hard questions of the lawyers in the best interest of the county. That’s what his job is as an elected official, he said, even if it makes him unpopular with the other commissioners.

“I think that’s what we should do, whether we like one another or not, or whether we trust one another or not,” O’Brien said. “If it’s good for the county, the objective data is there regardless of who gets the credit.”

Wednesday, November 18, 2009

More insanity in the education field

Be forewarned ... If you are reading this, the educationists consider you a member of the oppressor class. And your children are being indoctrinated with this nonsense. -- Jim

Note: And here I thought it was teachers unions and sycophantic administrators who are the oppressor class.

Another book review from the Marxists over at the Teachers College of Columbia Universities (excerpted from TCRecord):

Social Class and Social Action: The Middle-Class Bias of Democratic Theory in Education
Aaron Schutz — 2008

Background: This article examines the emergence of the middle and working classes in America and describes key characteristics of these cultures as they manifest themselves today. It then explores the effects of social class on our conceptions of democracy.

Purpose: To help educators understand the relationship between social action strategies and social class in American society.

Conclusions: Middle-class educators tend to prefer a form of “discursive democracy” that focuses on the enhancement of individuality within group activity. In contrast, working-class people are more likely to embrace a strategy of collective action that I call “democratic solidarity,” which responds to the limited resources and cultural practices specific to working-class life.

Recommendations: Educators who seek to support working-class students in their efforts to resist oppression must better understand the limitations of our tendency to focus on discursive democracy to the exclusion of forms of democratic solidarity.

Tuesday, November 17, 2009

Hanks and the BMV

Hanks makes a mess ... and we have to pay to clean it up. Thanks Hanks! -- Jim

From the Delaware Gazette. Thanks for outing Hanks! -- Jim

County sued over BMV lease
Tuesday, November 17, 2009

Staff Writer

Saying a four-year-old lease was invalid because it had not been signed by county commissioners, Delaware County officials in August stopped paying rent for a Lewis Center office that used to house a county-run BMV location.

The landlord has responded with a $144,000 lawsuit against the county filed in Franklin County Common Pleas Court earlier this month.

Tuller Square Northpointe LLC, a subsidiary of Casto properties, is suing the county for about $139,100 — the amount remaining on a rental agreement for a shopping center storefront at 8625 U.S. 23S in Lewis Center. The lease runs through August 2012.

The company also is demanding at least $5,000 in legal fees.

In August, Delaware County commissioners stopped paying its monthly $4,091.42 rent and utility payments to Tuller Square Northpointe for the storefront. At that time, commissioner Ken O’Brien refused to authorize any rent payments at county auditor George Kaitsa’s recommendation.

The lawsuit was filed Nov. 3, but the county didn’t receive notification until last week, court records show.

The county has until mid-December to respond to the lawsuit. County officials have previously said they hoped to settle the matter without delving into litigation.

The storefront used to hold a BMV deputy registrar location, which had been run by the county auditor’s office since 2005, until the state closed it in June. The BMV was too close to another location in Franklin County, state officials said.

Kaitsa, who was appointed to his position earlier this year, had asked the county prosecutor’s office to review the lease for the old BMV office to see if there was a way to get out of it so taxpayers wouldn’t have to pay for an empty building.

After looking over the lease, the prosecutor’s office said the lease was invalid because it was signed by former auditor Todd Hanks, and not the county commissioners as the law requires.
So, Kaitsa decided to vacate the storefront and turn in his keys.

“I feel it was the only decision I could make since it was not a valid lease,” Kaitsa said Monday, while declining to comment further.

Assistant prosecutor Bill Owen said the prosecutors’ office would “aggressively defend” the lawsuit, which he said was “without merit.”

“The fact that there was previously a lease honored at that location doesn’t change the fact that the county had every authority to terminate that lease,” he said.

County commissioners, who have discussed the matter in closed-door executive sessions, declined to comment for this story.

“At this point, I think it would be premature for any of us to say anything since it’s approaching litigation,” commission president Tommy Thompson said.

Commissioner O’Brien has previously said the county shouldn’t pay for an invalid contract. O’Brien also said Monday that Hanks should abstain from discussing the lawsuit or voting on any potential settlement payments since his signature is on the lease.

If the lawsuit is settled out of court, it would need the approval of at least two county commissioners.

It is unclear how four years passed before someone noticed the commissioners hadn’t signed the contract.

Delaware County Prosecutor Dave Yost has previously said his office reviewed the contract for the first time in August when Kaitsa asked them to. His office only reviews contracts when specifically asked, he said in August.

“Our office reviews things that are submitted to us, and we reply in writing,” Yost told the Gazette at the time.

Attorneys Dan J. Binau and Emily J. Jackson, representing Tuller Square Northpointe LLC, were not available for comment for this story.

The state awarded the county rights to open and operate the Lewis Center location in 2005 to compliment a nearby county-run title agency, which is still open.

At the time, Hanks secured a $100,000 contribution from the county’s general fund to open the Lewis Center BMV, saying it would be a money-maker for the county in just a few years.

However, performance lagged far behind his projections, which had been provided by the state.

The BMV turned its first profit of $19,000 in 2008. It roughly broke even this year before closing in June, but experienced a net loss of about $214,000 over its lifetime. Its seven full-time employees have since been transferred to other departments.

Police are trained to lie -- so says William Grigg

And I've never known Grigg to be wrong. -- Jim

“Police lie. It’s part of their job.”

That statement wasn’t made by an embittered defense attorney after losing a case. Those are the opening words of
an essay by former prosecutor Val Van Brocklin in the “training” section of In fact, that essay is the first installment in a two-part series entitled “Training Cops to Lie,” in which Van Brocklin offers guidance to police officers regarding their supposed right to lie and deceive criminal suspects.

“These investigative lies cover a wide web of deception — a web that can get tangled,” notes the former prosecutor. “Some investigative lies are legal, some are not, and some generate significant disagreement amongst courts, prosecutors, the public and officers themselves.”

“Effective interrogation of a suspect nearly always involves a deception — expressed or implied,” she continues. “The deception is that it’s in a suspect’s best interest to talk to police and confess without an attorney present. It’s not. A completely truthful officer would tell suspects this.”

This underscores the point — which cannot be made too frequently — that people should never talk to the police.

While police are supposedly entitled to lie, it is considered a criminal offense (generally described as
“obstruction”) for mundanes to lie to the state’s armed enforcers. Of course, Van Brocklin points out, there can be “serious consequences” for police who lie; they can be “sanctioned by the courts,” sued, subject to professional discipline, lose the confidence of the public, or even “have evidence suppressed, a case dismissed and a criminal freed.”

Nowhere in her essay does Van Brocklin admit the harm done to innocent people by lying police. As
a former prosecutor who now makes her living addressing law enforcement audiences, her sole intent is to teach police how to lie effectively, and protect themselves from negative consequences.

Monday, November 16, 2009

Watch out! Here comes communitarianism

Read and be watchful. -- Jim

From a reader:

Communitarianism. This is first on my list because most people have never heard of it. Communitarianism is a hard word to say. It is also hard to spell and difficult to remember. The official definition is, “of or relating to social organization in small cooperative partially collectivist communities.”

A condensed description of
Communitarian goals would be, “The balancing of individual rights against the needs of the [global] community.” I see a major problem with balancing or “harmonizing” individual rights versus community responsibilities”. When the rights of the individual are limited with laws, “administrative policies”, or professional peer pressure, the concept of personal freedom suffers.

Amitai Ezioni, the guru of the Communitarian Network and advisor to various presidents thinks that we have “focused on the rights of the individual for too long…” I couldn't disagree with him more. From restrictive Home Owner Associations to thousands of useless tax laws--the individual’s ability to live a private life (with private belongings) has been whittled away for decades.

Local Agenda 21 is a comprehensive policy set up by the United Nations. It was presented at the1992 Rio Summit. LA 21 outlines their plan for every community in the world to be managed under similar guidelines. They focus on Environmentalism, “Sustainable Development” or “Smart Growth” and “Economics” and so on. All of the countries of the world are either signed up to participate, or they are being peer pressured into signing up. If you haven’t heard the terms: “Green”, “Smart Growth”, or “Sustainable” buzzing in your ear lately… You’re either not listening, or you are a hermit.

The goals of Communitarianism are presented so that they always sound GREAT. Imagine! Well organized communities with people working together efficiently. Everyone trained or
designated to manage everything in a “Sustainable” fashion… and always with a focus on what is best for “Mother Earth”. If you disagree with their agenda,you obviously want to live in a poorly organized community where no one works together. Nothing is managed properly and therefore it cannot be sustained. Selfish individuals are ignorant of the needs of “Mother Earth” ...or they just don’t care. The individuals only care about themselves.

Often people mistake Communitarianism for Communism. This is a false conclusion. Various other titles describe communitarian values. Maybe you’ve heard them: The Third Way, The Radical Middle, “Non-partisans”, “Centrists” etcetera. (Both Obama and McCain represent Communitarian Ideals.) These separate titles exist for the “Communitarian Platform” because it identifies their goals AWAY from the goals of the “Liberals” or “Conservatives”. Third Way politics are the
SYNTHESIS of the left and right. The radical middle claims to combine the best of the “socialist leftists” and “ultra-capitalist conservatives”.

Communitarianism is not Communism because Communism focuses only on the power of the “state” and obliterates the existence of the individual. Within Communism, if you are not working for the interests of the “state”, then you
cease to exist. Communitarians claim to balance the individual’s rights against the needs of “community”. What they don’t tell you is that their work involving administrative laws and “regulations” is laying the foundations for a supra-national (world wide) legal structure. I placed Communitarianism at the top of this list because the goals of this movement are REAL and they are slowly being accomplished in EVERY community in the world: From the Bottom Up. The sovereignty of countries is being dissolved. It is being replaced with Communitarian Law. Stay Tuned for my next installment.

The book has been ordered ...

... and I am waiting on delivery. Sounds like an excellent book by Ostrowski. -- Jim

Contact: James Ostrowski
(716) 435-8918

Explosive Expose on Government Schools Published

Buffalo, New York. November 16, 2009. James Ostrowski, prominent libertarian and tea party movement leader, has published his second book,
Government Schools Are Bad for Your Kids: What You Need to Know. The book urges parents to pull their children out of the schools to escape crime, drugs, promiscuity, political correctness, indoctrination, and academic mediocrity. “This book provides the tea party movement with a strategic roadmap to restore the Jeffersonian vision of individual liberty that is the very essence of America,” he writes.Ostrowski was led to write the book out of anger that his own kids’ parish school closed in 2006. At the present rate, private schools are doomed as a poor economy and rising tuitions squeeze out working class parents who are already forced to pay large sums for failing government schools.

The fate of the nation is tied to the future of K-12 education, Ostrowski argues: “The grand result of our experiment with government schools is a population ill-prepared to deal with the present crisis in America. . . . they are utterly unequipped to deal with the harsh new reality that the regime is failing and the nation is in the process of economic collapse.”

Another excerpt: “Government schools are truly the foundation of big government today. They supply the funding and the troops [the teachers unions] and they drum the ideology into your children, five days a week for thirteen years. Finally, they render many children less able to survive without constant support and direction from the government. Their message is that people cannot live in freedom and they fulfill that prophecy with each graduating class.”

After reviewing 50 years of failed efforts to reform the schools through the political process, Ostrowski argues that the only feasible option is direct citizen action: a massive simultaneous withdrawal of children from the schools.

James Ostrowski is a trial and appellate lawyer in Buffalo, New York. He was on presidential candidate Ron Paul’s legal staff last year. His policy studies have been published by the Hoover Institution, the Ludwig von Mises Institute and the Cato Institute. His articles have been used as course materials at numerous colleges and universities including Brown, Rutgers and Stanford. He taught a course in the Constitution at Canisius College and has been a guest lecturer at the University at Buffalo Medical School.

Presently he is an Adjunct Scholar at the Ludwig von Mises Institute and columnist for He is editor of the libertarian blog, and founder and president of the Jeffersonian think tank, Free New York, Inc.

He is the author of the 2004 anthology, Political Class Dismissed, dubbed the “bible of the Upstate NY tax revolt.”

The book is for sale at

Saturday, November 14, 2009

Hanks's suit

It fits him quite well. -- Jim

From a reader (lack of formatting is due to my laziness -- but it is what it is):


09 CV 016429 OTHER CIVIL ACTIVE 11/03/2009




Name Attorney


Name Attorney


Date Description
11/03/09 CASE FILED

Todd Hanks created a mess and now the taxpayer has to pay

When Todd Hanks was county auditor, he took liberties with his statutory authority, and guess who ends up paying? You and me -- the taxpayers.

Hanks ... wallowing from one mess to another. Sounds like a certain type of animal. Can you guess which one.

The following was obtained by a reader via a public records request.
From: Betts, Christopher
Sent: Friday, July 10, 2009 12:11 PM
To: Kaitsa, George
Cc: Owen, William
Subject: BMV Lease

Auditor Kaitsa:

This email responds to the voicemail you left for me last evening (7-9-09). In your voicemail, you requested that I provide you with authority supporting the invalidity of the lease for the BMV space with Tuller Square Northpointe LLC. Specifically, you asked for authority supporting why the signature on the lease of Former County Auditor Todd Hanks was insufficient to create a valid lease.

As you are aware, a county and a county auditor are creatures of statute. In other words, they are both created by statute and, as a result, have only the authority specifically bestowed upon them by statute. Relative to the current circumstances, this means that the Ohio Revised Code would need to specifically grant authority to a county auditor to sign a lease for office space. I am unaware of any statute that provides such authority. Thus, the county auditor, on his or her own, lacks authority to enter a lease for office space.

The board of county commissioners, pursuant to RC 307.02, has the authority to acquire office space for county offices, including office space for the county auditor. This means that the board of county commissioners must approve any lease for office space. Given that only the board of commissioners, not the county auditor, has such authority and that the lease was not approved or signed by the commissioners, the lease is invalid.

Hopefully this information is helpful. Should you have any questions or need anything further, please feel free to contact me. Thanks.


Christopher D. Betts
Assistant Prosecuting Attorney
Delaware County Prosecuting Attorney's Office
140 North Sandusky Street, 3rd Floor
Delaware, Ohio 43015
Telephone: (740) 833-2690
Facsimile: (740) 833-2689

More news from Delaware

It will be interesting to watch this play out over the next weeks and months. -- Jim

From the Delaware Gazette:

County corrections officer under investigation
Friday, November 13, 2009


Staff Writer

The director of the Delaware County jail is on unpaid administrative leave pending an internal investigation by the Delaware County Sheriff on allegations of misconduct.

Sheriff Walter L. Davis II suspended Christopher L. Smith, 34, Monday and ordered him to turn in his handgun and badge and to not visit the jail or the sheriff’s office.

A letter in Smith’s personnel file states that he is being investigated for violation of office policies concerning non-discrimination and harassment.

The letter also states that Smith should have no contact with the person who filed a complaint against him and with employees of two companies that provide health care services at the jail. The investigation stems from an anonymous letter sent to county officials earlier this week.

The investigation is not a criminal investigation, a sheriff’s office spokesperson said.

Delaware County Commission president Tommy Thompson said he did not receive a copy of the letter about Smith, but heard about the situation from other county officials.

“Any information that was received or accusations have been handed over to the sheriff who is investigating it,” Thompson said.

The sheriff’s office also declined to talk about the existence of the letter and its contents due to the investigation.

Smith, who earns $51,002 a year as jail director, was hired at the Delaware County Sheriff’s Office in March 2008 after working for the Morrow County Sheriff’s Office for 10 years. Smith does not have any disciplinary actions on file with the Morrow County sheriff, according to his personnel file.

Smith was honorably discharged for unsatisfactory performance from the United States Air Force Wright-Patterson Air Force Base in Ohio, according to a certificate of release from the Air Force.

In an annual performance review dated Nov. 7, 2008 for the jail administration supervisor position Smith held prior to jail director, Smith’s superior wrote that Smith “needs to be mindful of his nonproductive activities to be able to complete daily tasks.”

Delaware County Commissioner Todd Hanks declined comment for this story, citing the ongoing investigation.

Delaware County Prosecuting Attorney’s Office projects coordinator Traci Whittaker declined to comment on whether the case was being looked at by the prosecutor’s office and referred all comments to the sheriff’s office.

Delaware County Commissioner Ken O’Brien and Smith could not immediately be reached for comment.

Friday, November 13, 2009

Division of Labor

Thanks to fellow bloggers RonMcK at Blessed Economist and Steve Scott at From the Pew for doing the heavy lifting on Christian issues, especially their research on biblical insights in the study of economics.

These two bloggers make it tough to write on Christian topics as they grab hold of their subjects with vigor and polish. Excellent writing. Check them out when you get the chance, you'll learn something and really enjoy yourself.

Note: In addition,
Blessed Economist has an excellent blogroll that links to many other interesting and informative sites. One site of note is KingdomWatcher's series on Christian Economics.

Thursday, November 12, 2009

FFF once again

From a recent edition of the Email Update from the Future of Freedom Foundation:

Wednesday, November 11, 2009

If a nation values anything more than freedom, it will lose its freedom; and the irony of it is that, if it is comfort or money it values more, it will lose that too.

— William Somerset Maugham [1941]

Celebrating the state's religion

The Marxists over at Teachers College Record -- the propaganda arm of the Teachers College of Columbia University -- (inter alia) dream of a command and control society. To foster that dream, those folks work tirelessly toward the goal of indoctrinating all children into the religion of the state -- the state's true religion.

Note: When these folks (including Scholz) use the term "nation," they are not referring those who pay taxes. No, they are referring to the social apparatus of coercion and compulsion (politicians and bureaucrats) that has arrogated our rights and our property, and desires to arrogate our families. Will WE abrogate with a sigh?

From Sally Scholz's review of Public Education--America's Civil Religion: A Social History over at

Education in every era, the authors suggest, is the primary instrument in fostering civil religion. The Pledge of Allegiance is the most prominent statement of the creed. When it was first written in the early 1890s, the Pledge commemorated Christopher Columbus’ landing 400 years earlier. The Pledge soon became a “national rite” and a centerpiece of our civil religion. Schools fostered national solidarity and although the growing sense of nation-pride may have started with the simple rite of the Pledge, Bankston and Caldas show how holidays celebrating American heroes like Washington and Lincoln took on the aura of holy days in the civil religion, uniting fellow countrymen and women in a collective expression of faith in the nation. They offer a stirring summary of the development of these elements of ritual for our civil religion: “By the end of World War I, the nondenominational state cult of American civil religion entailed sacred objects and places (the flag and monuments), a set of rituals based on those objects and places, martyrs and holy ancestors (the dead of American wars and the Founding Fathers), sacred days of commemoration, a creed (the Pledge), and a strong sense of the transcendent nature of the nation” (67). Schools taught the histories, practiced the rites, and celebrated the holidays that sustained and nurtured the faith in the nation.

Wednesday, November 11, 2009

Something strange in Delaware

From WSYX ABC 6:

Delaware Co. Deputy Under Investigation

Delaware, Ohio -- The subject of an ongoing internal investigation, a Delaware County Sheriff's deputy is being told to stay away from his place of work while being placed on unpaid administrative leave.At least one of the Delaware County commissioners reported receiving a letter -- possibly containing graphic materials -- trashing the deputy. ABC6 News learned the letter was turned over to the local prosecutor's office.Now, the sheriff is in charge of figuring out if there was any harassment, if anything sexual and inappropriate took place at the Sheriff's Office.Delaware Co. Deputy Under Investigation

Posted: Wednesday, November 11 2009, 06:52 PM EST

Quality is a Market Notion

Quality is a Market Notion
by Jim Fedako

Published by The Ludwig von Mises Institute

For generations, products have advertised themselves as "new and improved." We are too quick to dismiss this phrase as a promotional boilerplate. The market really does generate unrelenting improvements in our living standards. Meanwhile, the public sector is forever promising to improve its services and products but every attempt creates only conflict and eventual stalemate.

For example: the proposed solution to the ills of public education is for government to raise the quality of teachers by increasing salaries and certification requirements. The belief is that a better workforce will lead to better educational outcomes and an improved economy.

Of course the adjective better has no agreed upon definition. Every pressure group and political faction has its own definition of better. Mostly these disparate definitions contradict each other. Regardless, the call for better continues to grow louder each election cycle.

There are perceived ills in the free market too — not ills in the same sense as discussed above, but ills in that all consumers have wants that are unmet. The argument for better can be applied to any sector of the economy. Better factors of production are always sought since acting man desires improvements in consumer goods; improvements that are reflected in increased selection and quality, as well as lower price.

In this case, the adjectives better, improved, and increased can go undefined since they are subjective value judgments of each individual consumer. No one needs to define them in literal terms; the actions of consumers define those terms as ends that are either satisfied or unsatisfied. More importantly, acting man does not need government bureaucrats or commissions to codify such terms for quality. The entrepreneur knows he matched the market definitions of better, improved, and increased simply by looking at his profit-and-loss statement at the end of each accounting cycle.

That better factors are not simply added to each and every recipe — the directions for producing desired goods — is explained in one simple word: scarcity. Scarce factors have to be correctly employed in the production of the most sought-after ends. Any other application leads to accounting losses and financial ruin for the entrepreneur.

Entrepreneurs have more solutions to the unmet wants of man than capital goods. Capital goods are required in the creations of factors of production, which are themselves required in the production of consumer goods. Using resources to produce goods other than those most wanted leads to economic losses, as does using goods inefficiently to produce most-wanted goods. Consumers buying and abstaining from buying along with double entry bookkeeping provide guidance for the allocation of factors of production.

The socialist utopian belief that the burden of scarcity can be lifted with the correct utilization of current capital and factors of production is still prevalent. The line of thought goes that once the altruistic and omniscient bureaucrat grabs the reigns of the economy and guides the factors to their correct application, scarcity will fade away and the Land of Cockaigne will appear on the horizon.

But this is not reality. Scarcity will always be with us as long as man's desires exceed his ability to satisfy them. Of course, once scarcity is lifted, once all desires are met, society will meet the same fate as the ants in an Uncle Milton's Ant Farm: it will quickly die off.

At any given point in time, each factor is limited. Successful entrepreneurs recognize this and direct scarce resources to the most pressing needs. Government, on the other hand, recognizes no concept of scarcity. It only sees one side of the equation, or only one result of its actions. Government functions counter to Hazlitt's admonition to see the unseen; to look for secondary effects of any proposed action.

It's important to employ resources and factors where they will have the greatest effect. The successful entrepreneur would not use a high-quality diamond in a simple industrial process when a low-quality one would work fine. A CEO would not place his or her CFO in the company cafeteria to run the register simply because a $10 cash-versus-sales shortfall was being reported on a daily basis. To employ a highly skilled and hence scarce resource to chase the odd $10 would be wasteful and inefficient.

Human qualities are indeed scarce resources. No one would suggest that Joe Paterno would be most efficiently employed as a high school junior varsity coach. Would Joe Pa be effective? Of course he would. Would it be the best use of such a quality resource? Of course not. Many less experienced coaches could achieve the same result, though those same coaches could not generate Joe Pa's lifetime college win record.

The same goes with other scarce resources. Would Mises have generated the greatest bang for the buck teaching eighth grade economics? Would the resource known as Bill Gates be most efficiently employed as a ninth grade business teacher? How about Einstein as an AP physics instructor? It depends on who you ask.

The socialist utopians truly believe that a Mises, a Gates, or an Einstein would be most efficiently employed in the classroom. They have no concept of scarcity of human qualities and have adopted Trotsky's vision of all men rising to the height of Goethe and beyond. A utopian's fantasies do not allow him to see the world as it is. His epistemology is invalid so his beliefs and conclusions are errant.

Mises said that only a handful of any generation has the abilities to advance economic knowledge, and indeed he was correct. But to coerce the best and brightest to become primary and secondary teachers is to rob future generations of essential knowledge. The same can be said of the use of tax dollars to guide such geniuses into the primary and secondary classrooms by raising the incomes of teachers above their marginal product.

The unhampered free market correctly allocates resources to their best use. Interventionism changes the allocation so that resources are applied to uses that are not beneficial to a society. Government loves to create roadblocks to entry into fields of choice.

Raising teacher certification standards above that required by the desires of man simply creates shortages where none should exist. Attracting the best and brightest with too-high salaries — salaries above their marginal product — or by creating shortages (real or perceived) succeeds only in raising the cost of education; it does nothing to solve the ills of a government-run education system.
Because of this, education is best left in the hands of the free market. Under a free market, the allocation of scarce human qualities and knowledge will be matched to the desires and wants of man. Public school math teachers, gym teachers, librarians, etc., would be paid exactly what they produce; no more, no less.

Should the desire for knowledge garnered in a ninth grade business class exceed that of the desire for faster and cheaper personal computers, Gates would find his most remunerative employment in the classroom. Otherwise, keep the Miseses, Gateses, and Einsteins of the world out of primary and secondary classrooms, and keep government out of education. We will all be better off.

Monday, November 09, 2009

The Rise and Fall of Society: a live blog

A bow to Chodorov, and then a hasty exit from the ring

I think I knew from the very beginning he would have the best of me. Not that I wouldn't venture into the ring and stand my ground, full of pride in my own possibilities. But it was obvious from the start that his powerful stature and lengthy reach would easily deliver strikes capable of staggering me to no relief.

It ended up a short fight. For two rounds I held my own. Or so my story goes. You may have seen the first two rounds and think otherwise. Yet for those two rounds I dreamed a chance -- the challenger's fatal conceit.

With Chodorov, distilling his writing into summary quotes is a challenge best reserved for the foolish. And I had played the fool.

I did what I could to delay the start, but I finally took the bell for round three. I stepped toward him and saw his stance. His style was something to behold. I took a second step and once again felt the doubt that separates champion from journeyman.

In the previous rounds, I had wanted to fold into a literary rope-a-dope and let Chodorov pound himself into exhaustion. But the rope-a-dope defense of simply copying full chapters is not permitted the live blogger. In each round, I had to throw my own punches in order to be allowed to continue the fight.

Without a defense and no offence, drained and tired, I took my pounding in that third round without even raising a hand. I took a dive and threw the fight.

Chodorov won, and only I am shocked.

I simply ask that the reader take a walk with Chodorov. It sure beats facing him in the ring.

Note: The challenge is
here. The rounds are here and here.

Saturday, November 07, 2009

Both hands in my wallet

The Ohio School Boards Association exists (inter alia) as the chief lobbyist for Ohio's government schools.

With one hand, they grab for more property taxes while, with the other, they grab for more income taxes.

While the private sector contracts, government expands. While folks are losing their jobs, district staff are demanding and receiving hefty raises. While we desire to keep as much money in our wallets, government schools are grabbing with both hands.

And these are the very same folks influencing the leaders of tomorrow. Sad.

Note: Your tax dollars pay for OSBA lobbying. Keep that in mind.

From OSBA:

OSBA testifies on tax freeze measure

OSBA, along with the Ohio Association of School Business Officials and the Buckeye Association of School Administrators, testified in the Senate Finance and Financial Institutions Committee in support of House Bill (HB) 318, legislation that will postpone for two years the last of five previously scheduled reductions in state personal income tax rates.Our organizations lent support because the uncertain fate of the video lottery terminal money creates a loss of anticipated education revenue of more than $850 million. We urged the committee to support this timely legislation so that additional budget reductions will not be necessary.To view our testimony, click here.

Friday, November 06, 2009

Hanks stepped in a mess ... and it stinks

Poor Todd, this stench will not easily wash off. I have to ask: What other activities is Todd engaging to "make ends meet"? Hmmm. - Jim

From The Delaware Gazette:

Hanks leaves consulting position
Friday, November 6, 2009

Staff Writer

Delaware County Commissioner Todd Hanks has resigned his job working as a part-time consultant for a local civil engineering firm, the Gazette has learned.

Hanks had been working part-time for Civil Engineering Consultants, a firm with specialties that include environmental studies and solid waste management, since shortly after being appointed to the county commission last January. Hank was slated to make a $50,000 annual salary, plus a commission based on work he referred to the company.

When asked by the Gazette, Hanks said he resigned from the position on Oct. 6.

“I felt it was in the best interest of the county,” Hanks said Thursday. He declined to elaborate, but said he arrived at the decision independently of his employer. A representative with CEC could not be reached for comment.

Hanks was county auditor when he was appointed to the county commission last January. He took a $14,000 pay cut to become a commissioner, and Hanks said he accepted the job with CEC to help make ends meet.

It is not illegal or particularly unusual for elected officials to hold an outside job, but ethics laws require elected officials to clearly separate their public and private work. A written opinion from the Ohio Ethics Commission said the law prohibits Hanks from representing CEC before any county agency or from using his influence as an elected official to benefit his employer.

However, a May meeting between Hanks, county officials, Village of Sunbury officials, State of Ohio officials and CEC representatives may have blurred the line between Hanks’ private and public jobs, legal sources have told the Gazette.

Hanks invited the CEC representatives to the meeting to try to find them work with a private landowner who was working with Sunbury on a redevelopment project.

Delaware County economic development director Gus Comstock had set the meeting up with the Sunbury village administrator, and Comstock discussed seeing if county revolving loan funds could be contributed toward the project. Neither the landowner nor the Sunbury officials knew Hanks worked for CEC until months later.

No county money was ultimately contributed to the project. Hanks has said he did nothing wrong, and pointed out that he abstained from votes from boards that he was sitting on that would affect CEC’s work for private contractors. CEC has not done business with Delaware County since August of 2008.

Although Hanks declined to explain his exact reason for resigning from CEC, an engineering and contracting source said attention prompted by Gazette articles was a factor in the decision.

Political pressure may have been a factor too — sources within the Delaware County Republican Party said Hanks’ employment led to “grumbling” and concern among some Republican party central committee members. Hanks is up for re-election next year and the county GOP will likely begin the endorsement process late this year, in advance of the May primary election.

Delaware County Democratic Party Chair Ed Helvey said even though Hanks has given up his private job, his party would make an issue out of Hanks’ former employer come election season.

Helvey said he thought Hanks’ employment with CEC inappropriately “collided head-on” with his authority as a county commissioner.

“It goes to the heart of his integrity and honesty as to why he’s an officeholder,” Helvey said. “Is he there to serve the people or is he there for personal gain?”

Thursday, November 05, 2009

Government of the people in action

This in full view of the judge. But do you really believe that she is about to punish "her deputy?" Catch the "courtroom security" nonsense. A travesty of justice. (HT Jim

Wednesday, November 04, 2009

Bob Dylan serenades the winners

In a real sense of irony, I was attending the Bob Dylan concert last night as the votes were counted. Dylan must have gotten advanced notice of the pending results. How else would he have known to serenade Tweedle Dee and Tweedle Dum on their victories? -- Jim

Tuesday, November 03, 2009

The Austrians versus the Mainstream Potter and His Wheel

A recent article of mine over on the Blog at

The Austrians versus the Mainstream Potter and His Wheel
Jim Fedako

Is capital an amorphous mass? A mass formed out of the ether, which can be reformed as desired and without effort? Or is capital a physical mass that can be reformed only through the use of scarce resources over a period of time?

The prevailing view assumes that capital is simply one of many factors used in equations, functions, and models. Capital is homogenous, so the greater the amount of capital, the better off society is. And it does not even matter how capital has taken shape in the past, since, once formed, it can be reformed wherever and whenever needed.

But, of course, that is not reality. Capital, in all places and at all times, is a historic relic. It is physical, in many instances hardened, while in others only slightly malleable. It is not some mass that can be modified free form to fit the needs of today and tomorrow.

Life in a Northern Town

I grew up near a northern town. As I rode my bike along the mighty rivers of southwestern Pennsylvania, the scene was always the same: in valleys nestled in green, rounded hills, the rusting remains of Pittsburgh's once-proud steel industry sulked while the slow and deliberate flow of water marked the passage of time. These colossal structures of industry past stood (and stand) as a testament to the massive amount of resources invested in that area.

As the steel industry moved elsewhere, businesses abandoned most of the factories. Certainly, new entrepreneurs utilized some components of the capital for other purposes. However, in the main, those past investments were left fallow, to be slowly reclaimed by nature — dust to dust.
If capital were homogenous and plastic, able to take on new shapes without the need for time and the expenditure of scarce resources, the Pittsburgh region would have remained in bloom. However, a quick trip through the area reveals the unbending nature of most capital — a sunk cost with little to no alternative use.

"There's Millions Buried in those Mines"


I spent my youth living near a coal mine that had been abandoned for as long as I can remember. Folks in the area liked to talk about all the equipment buried when the shafts were finally sealed — the implication being that the mine owner had left behind something of value.

However, the mine owner recognized that the equipment buried deep in the ground no longer had any value to the market. It was as worthless as all the slag piled nearby. The market had reduced its K value to zero. The owner sealed his mine and walked away, leaving behind nothing of value.

Technology as Capital Infrastructure

Technology is essential to the modern economy. In particular, the transactions of the modern economy move on electronic highways built with computers and software. In order to satisfy consumers and stay profitable, businesses must continually maintain their computer systems and applications. And since businesses are faced with the ever-changing wants of fickle consumers, they must invest in new and improved technology. To ignore change is to fall behind.
"In the main, those past investments were left fallow, to be slowly reclaimed by nature."
The development of new software applications is never an easy process. Put end users in a room with technologists and ask them to devise the best solution. The end product will be a utopian dream: a plan that does not respect the economic law of scarcity — scarcity of time and resources.

Send those very same folks back into the room with a prioritized list of business needs, along with a budget, calendar, and list of resources, and the end product will be a solution that is viable.

Nevertheless, in order to define the solution, the development team has to understand this essential given: the current state of the company's computer systems and applications. The existing infrastructure is the product of investments in past solutions. But it is an infrastructure that can be as unbendable as the rusted hulk of an abandoned steel plant.

While it is true that the company has (say) $100 million invested in technology, it is not true that the $100 million is a resource that can be reengineered into the new solution. The $100 million is for the most part a sunk cost, a relic of previous development efforts.

Therefore, as the development team goes about defining the future system, it has no concern for the cost of previous investments. Consider this example:

If the cost of the new system is $110 million, the development team does not claim that the effective cost is just an additional $10 million ($110 million minus the current capital of $100 million). The team recognizes that the $100 million does not sit in some pool of "K" that they can dip into when building the new system. That $100 million is sunk.

While it may be true that some components of the current system are portable to the new system, thus reducing the total expenditure, capital is, for the most part, fixed and sunk. This is especially true when a system is mature and integrated into other systems and applications.

The Austrians versus the Mainstream Potter and His Wheel

The standard view is that capital is clay, ready for the potter to reshape it in a moment's time. In contrast, the Austrian view takes the current structure of capital as a given, something that the entrepreneur must take into consideration when formulating his plans. If an entrepreneur wants to change the current structure of capital, he will wield dynamite and dozer, not water and wheel.
The different views of capital lead to different views of government interventions in the market. If capital were similar to pottery clay, there would be no real concern of credit expansion leading to a misallocation of capital.

Misallocations would be nothing more than a minor inconvenience — a sidestep, so to speak. Once the potter discovered a misallocation, he would simply wet his hands, spin his wheel, and reshape the capital into its desired form. Oh, if life were only so.

Our reality is this: Misallocations are wasted resources, including precious and scarce time. Misallocated capital is of no use to anyone. It is a loss to the entrepreneur, the investor, and the consumer.

We all champion the development of new capital. But if new capital is the direct product of government spending or the indirect result of its fiscal policy, we are all worse off. Building capital structures, unsupported by consumer demand, does nothing to increase an aggregate societal K (assuming such a K exists). It only takes us farther from the path leading toward our desired end: the removal of unease felt by acting man.