My speech from yesterday:
Check it out!
I’ll be uploading quite a few videos from the International Students for Liberty Conference over the next few days.
Here is the first one:
Congressman Justin Amash Says End the Fed
Originally posted at FreedomWorks.org.
Nearly two years after ObamaCare was signed into law, we are still finding out what was really in the 2,801 page bill. Many are shocked to find out that the intrusive law contains a provision that forces all employers to provide “free” birth control to all female employees by August 2013. Of course, there’s no such thing as a free lunch or free contraception in this instance. Most conservative bloggers have primarily focused on how the birth control requirement violates freedom of religion but it’s important to examine the mandate from an economic standpoint as well.
All of us should remember the old adage that goes “if one can frame the debate, one wins the debate.” Without fully realizing it, libertarians and fiscal conservatives all too often allow the left to frame the debate. The left has framed the birth control mandate debate as a battle between pro- and anti-birth control advocates. Leftist political pundit Rachel Maddow has claimed that the GOP is declaring a “war on birth control.” But that is entirely misleading; the real debate is between individual rights vs. government force.
Those opposed to the mandate are not necessarily against birth control. Some are but many are not. The left often accuses libertarians and fiscal conservatives of being opposed to a certain good or service just because we do not want it provided or mandated by the government. This intellectually dishonest debate tactic has been used for centuries in attempts to discredit free market supporters.
As Frédéric Bastiat wrote in his timeless book The Law, “socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all. We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.”
These accusations are far from the truth. True free market supporters believe that all economic activity should be voluntary for everyone. This means that individuals should be free to buy, sell and produce whatever good they desire without government coercion. Forcing employers to provide “free” birth control coverage violates the principles of a free and peaceful society. No one would be legally forced to provide or buy a product that offends their personal beliefs and values in a pure free market economy.
The birth control mandate debate has centered around religious freedom but its likely unintended economic consequences should not be ignored. The mandate has moral hazard written all over it. Moral hazard occurs when people change their behavior when they are insulated from the real cost of their actions. Women are less likely to carefully consider their birth control options if they are getting it for “free.” As economist Peter Schiff says, “when women are buying their own birth control, they are shopping around. The price is a consideration. When they get it for ‘free’, price is no consideration.” Women will be more inclined to take the most expensive birth control option regardless if it makes the most sense.
This means that the mandate will ultimately increase the price of contraception. Peter Schiff further explains that “the problem is when you get something for free, behavior changes. People use things a lot more when they are free and you drive up the cost.” The economic reality is that there is a cost to everything. No matter how well-intentioned government legislation may be, it simply cannot repeal the law of scarcity. Birth control will never be free.
Insurance company Blue Cross has unofficially announced that it would cost $2.8 billion to cover contraception. This cost will eventually be passed onto all consumers in the form of higher insurance premiums. It reminds me of the popular P.J. O’Rourke quote, “if you think health care is expensive now, wait until you see what it cost when it’s free.” Just replace “health care” with “birth control” in that quote.
Another unintended consequence associated with the birth control mandate is that it could lead to gender discrimination in the hiring process. It will cost employers more money to hire women since they are forced to provide them with contraceptive coverage. Employers are not required to provide men with additional coverage. The cost of employing a woman will increase whether she wants birth control or not. The supposedly well-intentioned law will actually end up hurting women.
The birth control mandate not only violates freedom of religion but it will drive up the price of contraception and may lead to female discrimination. This is just one more reason why we need to get the government out of health care in order to allow the free market to flourish.
Please check out the Peter Schiff video on the birth control mandate below:
Check it out!
New video to go with my post:
Originally posted at FreedomWorks.org.
1. The Federal Reserve Has Far Too Much Power to Control Our Economy
Federal Reserve Chairman Ben Bernanke has the power to dramatically impact our economy at a drop of the hat. The central bank completely controls and determines the money supply. It is permitted to create as much money as it wants out of thin air with no restrictions. This is the antithetical to the principles that America was founded on. Our Founding Fathers would be outraged that one centralized institution has unchecked and unprecedented power to control the economy and thus our lives.
2. The Federal Reserve Has Significantly Devalued Our Currency
The laws of supply and demand apply to money. The more dollars we have in the circulation, the less the currency is worth. Our money supply has rapidly increased over the past century due to the Federal Reserve printing massive amounts of money like there is no tomorrow. This is what will almost inevitably happen when a quasi-governmental entity can simply print more money to its heart’s content. Since the Federal Reserve came into existence in 1913, the dollar has lost over 95 percent of its value. Today’s dollar is worth less than a nickel compared to the pre-1913 dollar.
3. The Federal Reserve Hurts the Poor and Middle Class the Most
Our hard-earned money is essentially stolen through a hidden inflation tax. Inflation is the increase in the supply of money and credit. It is often wrongly defined as the general rise in the price of goods and services. But higher prices are actually a direct consequence of inflation since increasing the supply of money decreases the purchasing power of the dollar. Inflation hurts the poor most since they have less disposable income. Consumers with low disposable incomes will be negatively impacted by higher prices for food and clothing.
4. The Federal Reserve is Run By Unelected and Unaccountable Bureaucrats
The Board of Governors at the Federal Reserve are not directly elected by the American people. This means that those who run the Federal Reserve are unaccountable to the people. The seven members of the Board ultimately decide the price or purchasing power of our money. That kind of central planning would never exist in a true free market economy.
5. The Federal Reserve Has Made Our Economy Less Stable
The Federal Reserve has brought us endless boom-and-bust cycles. The U.S. economy was much more stable before the Federal Reserve came into existence. It bears significant responsibility for every financial crisis over the past century including the Great Depression, the stagflation of the 1970s and recent economic meltdown. The Austrian Business Cycle Theory explains why we see such wide fluctuations in the economy. The theory states that a false boom occurs when the Federal Reserve lowers interest rates below the market rate which increases the supply of money. Artificially low credit cost sends out misleading economic signals to producers. They are inclined to respond by greatly expanding their production around the same time. In retrospect, these investment decisions called malinvestments are seen as a bad allocation of resources. Malinvestments will lead to wasted capital and economic losses. The expansion of credit cannot continue permanently which means that inevitable bust will follow a false boom created by the Federal Reserve.
6. The Federal Reserve is Far Too Secretive
The central bank severely lacks transparency. Throughout its 100-year history, it has always operated under a veil of secrecy. The Federal Reserve has never been fully audited by any outside source. Our elected representatives in Congress have very little oversight over the central bank. It has continually resisted any kind of congressional oversight claiming that it would endanger its “independence.” A comprehensive audit of the Federal Reserve would not harm its so-called independence. It would only expose how the Federal Reserve has been manipulating our currency behind closed doors. And Ben Bernanke surely doesn’t want that to happen.
7. The Federal Reserve Benefits Special Interests
The policies of the Federal Reserve hurt the average American. It benefits the privileged few at the expense of the rest of us. The Federal Reserve erodes most Americans’ standard of living while enriching well-connected elites. The central bank serves big spending politicians, big bankers and their friends. Special interests receive access to money and credit before the harmful inflationary effects impact the entire economy. This is why high power lobbyists protect and defend the existence of the Federal Reserve.
8. The Federal Reserve is Unconstitutional
The Constitution makes no mention of a central bank. While there have been historical debates on the constitutionality of a central bank, I see no justification for the argument that the Federal Reserve is constitutional. The federal government only has about thirty enumerated powers delegated to it in the Constitution. The power to create a central bank is not explicitly granted to the federal government in our founding document. Due to my strict interpretation of the Constitution, I find the Federal Reserve to clearly violate the Constitution.
9. The Federal Reserve Routinely Bails Out Big Banks
The Federal Reserve acts as the lender of last resort. The Federal Reserve was ordered through a Freedom of Information Act request to release 28,000 pages of documents in March 2011. The documents exposed that one of the largest recipients of the Federal Reserve’s money was foreign banks during the 2008 economic meltdown. The top foreign banks that received money were the Brussells and Paris based Dexia SA, the Dublin based Depfa Bank Plc, the Bank of China and Arab Banking Corp., according to Campaign for Liberty.
In July 2011, due to a provision under the misguided Dodd-Frank financial overhaul law, the Government Accountability Office (GAO) conducted a one-time, watered-down audit of the Federal Reserve. The GAO investigators were not allowed to view most of the Federal Reserve’s monetary policy decisions including discount window lending, open-market operations and details on its transactions with foreign governments and banks. This first ever audit of the Federal Reserve revealed $16 trillion in secret bailouts to corporations and banks around the world in less than three years. These bailouts happened without a single vote taking place in any chamber of Congress.
10. The Federal Reserve Encourages Deficit Spending
The Federal Reserve is largely responsible for the out-of-control spending by Congress. The federal government can only obtain money through taxation, printing or borrowing money. Printing money has become the federal government’s preferred method. This is also the most destructive method since the federal government is able to simply print more money as needed to finance its drunken spending spree. It has become a never-ending cycle of spending and printing more money. Voters can put pressure on their representatives to halt politically unpopular tax hikes and lenders could stop loaning money to the U.S. government. But it’s fast and easy for the Federal Reserve to print more money at a whim.