The Objective Standard Blog

Thursday, May 29, 2008

Investigate Big Congress, Not Big Oil by Alex Epstein

Posted by ARI Media at 11:38 am

With gasoline prices exceeding $4 a gallon in some states, politicians are responding as usual: Blame Big Oil First. Several prominent senators have once again summoned industry leaders to Capitol Hill, subjecting them to yet another barrage of rhetorical questions, interruptions, accusations, and sermons. The lawmakers’ goal, claims Sen. Patrick Leahy, is to identify "causes of the rising price of oil on which Congress can act." But the foregone conclusion is that "price gouging," "collusion," and "market manipulation" by Big Oil, or speculation by financiers, is responsible.

The simple fact that such Congressional investigations are designed to obscure is that the prices of oil and gasoline are determined by supply and demand—which neither private oil companies nor speculators have any power to dictate in their favor. If they had such market mastery, then why didn’t they use it in the 1990s, when gasoline was selling at a barely profitable $1 a gallon? To be sure, speculators can bid up prices—but they only do so when they believe that oil will become even more expensive in the future, and only make money when they are right.

The question Congress should really be asking, then, is: What nonmarket factors are distorting supply and demand? If they sought an honest answer, they would discover that much of the blame lies with Congress itself.

No one disputes that environmentalist laws passed by Congress have cut off some of our most promising and plentiful sources of oil. In the name of safeguarding a tiny portion of caribou habitat in the Alaskan wilderness, drilling is prohibited in the Alaska National Wildlife Refuge—a potential source of 1 million barrels a day, 5 percent of America’s daily oil consumption. Also off-limits is 85 percent of America’s coastline, which Shell estimates contains some 100 billion recoverable barrels—13 times America’s annual oil consumption—and the vast majority of oil shale in Colorado, which Shell estimates at 1.5 trillion barrels.

Congress should publicize these facts, prepare an inventory of how many oil-rich areas they have blocked off, and bring in economists to estimate how much all of this raises gas prices.

And how about the effects of Congress’s open hostility toward the future of oil? Our politicians damn oil as an "addiction" to be eliminated, and seek to cut—by up to 90 percent—the use of oil and other vital fossil fuels that make our standard of living possible. Congress should ask oil executives how this possible forced cut in demand affects their industry. It should ask whether they feel safe to make the billion dollar investments and decades-long plans that oil production requires when Barack Obama, a leading presidential candidate, can uncontroversially proclaim that "the country that faced down the tyranny of fascism and communism is now called to challenge the tyranny of oil." Is it a coincidence that the much-maligned speculators think oil will become even scarcer in the future, and are acting accordingly?

In addition to investigating its own impact on gasoline prices, Congress should investigate how its economic policy partner, the Federal Reserve, has raised our gas prices by lowering the value of the dollars we buy gasoline with. The Fed, along with the Treasury Department, has for years had an inflationary policy that has caused the value of the dollar to plummet relative to other currencies. Were it not for this devaluation of the dollar, oil prices would likely be 40 percent lower—as they are for those on the Euro. Why not call a free-market economist to the stand and ask how much more expensive Alan Greenspan, Ben Bernanke, and Henry Paulson have made our gasoline?

Americans deserve to know the story—in all its gory detail—of what their government has done and is doing to cause high prices at the pump, and to make gasoline—indeed, all energy—more scarce and more expensive in the future. A congressional investigation of Congress would be a great public service.

Alex Epstein is an analyst at the Ayn Rand Institute, focusing on business issues. The Institute promotes Objectivism, the philosophy of Ayn Rand—author of Atlas Shrugged and The Fountainhead.

Posted in: Business and Economics, Environmentalism

Monday, May 26, 2008

What We Owe Our Soldiers by Alex Epstein

Posted by ARI Media at 2:23 pm

Every Veterans Day we pay tribute to our fellow Americans who have served in the military. With speeches and ceremonies, we recognize their courage and valor. But justice demands that we also recognize that we should have far more living veterans than we do. All too many of our soldiers have died unnecessarily—because they were sent to fight for a purpose other than America’s freedom.

The proper purpose of a government is to protect its citizens’ lives and freedom against the initiation of force by criminals at home and aggressors abroad. The American government has a sacred responsibility to recognize the individual value of every one of its citizens’ lives, and thus to do everything possible to protect the rights of each to life, liberty, property, and the pursuit of happiness. This absolutely includes our soldiers.

Soldiers are not sacrificial objects; they are full-fledged Americans with the same moral right as the rest of us to the pursuit of their own goals, their own dreams, their own happiness. Rational soldiers enjoy much of the work of military service, take pride in their ability to do it superlatively, and gain profound satisfaction in protecting the freedom of every American, including their own freedom.

Soldiers know that in entering the military, they are risking their lives in the event of war. But this risk is not, as it is often described, a "sacrifice" for a "higher cause." When there is a true threat to America, it is a threat to all of our lives and loved ones, soldiers included. Many become soldiers for precisely this reason; it was, for instance, the realization of the threat of Islamic terrorism after September 11—when 3,000 innocent Americans were slaughtered in cold blood on a random Tuesday morning—that prompted so many to join the military.

For an American soldier, to fight for freedom is not to fight for a "higher cause," separate from or superior to his own life—it is to fight for his own life and happiness. He is willing to risk his life in time of war because he is unwilling to live as anything other than a free man. He does not want or expect to die, but he would rather die than live in slavery or perpetual fear. His attitude is epitomized by the words of John Stark, New Hampshire’s most famous soldier in the Revolutionary War: "Live free or die."

What we owe these men who fight so bravely for their and our freedom is to send them to war only when that freedom is truly threatened, and to make every effort to protect their lives during war—by providing them with the most advantageous weapons, training, strategy, and tactics possible.

Shamefully, America has repeatedly failed to meet this obligation. It has repeatedly placed soldiers in harm’s way when no threat to America existed—e.g., to quell tribal conflicts in Somalia, Bosnia, and Kosovo. America entered World War I, in which 115,000 soldiers died, with no clear self-defense purpose but rather on the vague, self-sacrificial grounds that "The world must be made safe for democracy." America’s involvement in Vietnam, in which 56,000 Americans died in a fiasco that American officials openly declared a "no-win" war, was justified primarily in the name of service to the South Vietnamese. And the current war in Iraq—which could have had a valid purpose as a first step in ousting the terrorist-sponsoring, anti-American regimes of the Middle East—is responsible for thousands of unnecessary American deaths in pursuit of the sacrificial goal of "civilizing" Iraq by enabling Iraqis to select any government they wish, no matter how anti-American.

In addition to being sent on ill-conceived, "humanitarian" missions, our soldiers have been compromised with crippling rules of engagement that place the lives of civilians in enemy territory above their own. In Afghanistan we refused to bomb many top leaders out of their hideouts for fear of civilian casualties; these men continue to kill American soldiers. In Iraq, our hamstrung soldiers are not allowed to smash a militarily puny insurgency—and instead must suffer an endless series of deaths by an undefeated enemy.

To send soldiers into war without a clear self-defense purpose, and without providing them every possible protection, is a betrayal of their valor and a violation of their rights.

This Veterans Day, we must call for a stop to the sacrifice of our soldiers and condemn all those who demand it. It is only by doing so that we can truly honor not only our dead, but also our living: American soldiers who have the courage to defend their freedom and ours.

Posted in: Foreign Policy and War, Individual Rights and Law

Saturday, May 24, 2008

Turkey’s Turn Back to the Book

Posted by John David Lewis at 3:06 pm

According to a recent article in the Jerusalem Post (“Is Turkey’s Government Starting a Muslim Reformation?” Daniel Pipes, May 22, 2008), a government ministry in Turkey, the so-called “Presidency of Religious Affairs and the Religious Charitable Foundation,” has undertaken a three year project to study and condense thousands of pages of material associated with Islam. The problem, they claim, is that fourteen hundred years of “Hadiths,” reports about the sayings and deeds of Muhammad, have distorted the meaning of Islam as revealed in Islam’s central text, the Koran. The goal of the project is to weed-out all that is inconsistent with the Koran.

According to one of the eighty Islamic theologians involved, “The Koran is our basic guide. Anything that conflicts with that we are trying to eliminate.” According to Mehmet Görmez, a senior lecturer at Ankara University, “We want to bring out the positive side of Islam that promotes personal honor, human rights, justice, morality, women’s rights, respect for the other.” To promote the spread of Islam in the 21st century, the Turkish theologians want to redefine how Muslims must practice Islam.

The very fact that this project is being undertaken by the Turkish government signals the rise of Islamic rule in Turkey. Any government that purports to decide which religious interpretation is “correct” has established a theocracy. The first step in any genuine religious reform must be to sever the connections between political power and religion, and to affirm the rights of everyone to think and to speak as they wish.

The promoters of the project bill it as an attempt to define a way of following Islam that is appropriate for the modern world. Since the Koran is their central authority, the first question we must ask is: What does the Koran actually say about these matters? (All passages here are taken from the Muslim Students Association translation by Yusuf Ali.)

As regards women, the Koran is clear about their subordinate status, the basis of male superiority in physical strength, and the need for women to stay home, be taken care of by their husbands, and obey under pain of beating:

Men are the protectors and maintainers of women, because Allah has given the one more (strength) than the other, and because they support them from their means. Therefore the righteous women are devoutly obedient, and guard in (the husband’s) absence what Allah would have them guard. As to those women on whose part ye fear disloyalty and ill-conduct, admonish them (first), (Next), refuse to share their beds, (And last) beat them (lightly); but if they return to obedience, seek not against them Means (of annoyance): For Allah is Most High, great (above you all). (Koran, 4.34)

The passage speaks for itself. To soften the text, the translator inserts “lightly” after “beat them,” as if wife-beating was proper if done in moderation. Who is to decide what constitutes the proper degree of beating? Male clerics, of course. But no amount of sophistry can hide the fact that this is non-negotiable advocacy of the physical abuse of women.

What of people who are not Muslims (the “other”)? The Koran is clear that they must submit to Islamic rule, accept an inferior position, and pay tribute to avoid destruction:

Fight those who believe not in Allah nor the Last Day, nor hold that forbidden which hath been forbidden by Allah and His Messenger, nor acknowledge the religion of Truth, (even if they are) of the People of the Book, until they pay the Jizya [the tax levied on non-Muslims] with willing submission, and feel themselves subdued. (Koran 9.29)

The meaning of this demand for submission was defined by one of the most revered of the early Islamic philosophers, Al-Ghazali, a central figure in the allegedly non-violent Sufi wing of Islam:

[O]ne must go on jihad at least once a year . . . one may use a catapult against them [non-Muslims] when they are in a fortress, even if among them are women and children. One may set fire to them and/or drown them . . . .

[T]he dhimmi is obliged not to mention Allah or His Apostle . . . Jews, Christians, and Majians must pay the jizya . . . the dhimmi must hang his head while the official takes hold of his beard and hits [the dhimmi] on the protruberant bone beneath his ear . . . their houses may not be higher than the Muslim’s, no matter how low that is. . . . They [the dhimmis] have to wear [an identifying] patch . . . [dhimmis] must hold their tongue. (from “Sufi Jihad?” by Andrew Bostom, May 15, 2005)

This passage is directly relevant to the modern day. The height of buildings (e.g., the insulting scale of the World Trade Center), the injunctions against any criticism of Islam, the demand for a compliant, self-effacing attitude among non-Muslims, the payment of tribute (“foreign aid”), even the identifying patch demanded of Jews by the Nazis—concern with all of these issues may be found in the writings of Al-Ghazali, the most mystical of the “moderates” during Islam’s “Golden Age,” and a staunch proponent of jihad.

Those undertaking the Turkish project claim the authority to judge which texts are consistent with the Koran, and which are not. But what does the Koran say about our capacity to make such judgments? It denies them categorically and repeatedly—which is why many fundamentalist Muslims claim that the Koran is all they need. As regards fighting, for instance, the Koran says:

Fighting is prescribed for you, and ye dislike it. But it is possible that ye dislike a thing which is good for you, and that ye love a thing which is bad for you. But Allah knoweth, and ye know not. (Koran 2.216)

Elsewhere the Quran claims that jihad must continue “until all dissension is ended.” (8.39) Abject universal agreement with the clerical elite is the goal. You are not capable of judging when and whom you must fight—and neither may you judge which aspects of the Koran to follow. Your mind is incapable of independent judgment. Your role in life is to obey the clerics.

Such passages are only a sample of what is found in the book that an agency of the Turkish government will use as its basic guide for the next century.

It should not be surprising that the positions taken by this same government ministry are avowedly opposed to thought, speech, and writing that is critical of Islam. Here, from a February 4, 2008 press release on its website, is its position toward the film “FITNA,” which was critical of Islam:

This film involves direct insult to Islam’s Holy book and the Islamic religion, which is another show of “hostility” today, provoking violence and hatred against it, though Islam has complemented the other religions with its message emphasizing equality, freedom of conscience and mutual respect among people. . . .

The Muslims strongly condemn all forms of hatred messages and the wrong perceptions fabricated against Islam. The Muslim world is aware of the provocations that aim to demonstrate Muslims as potential terrorists and gradually exclude them and hurt their feelings.

Note the appeal to “feelings” and the claim that “hurt feelings” are grounds for censorship—suppression of speech and writing by government force. Note that those who burn, bomb, and behead people while chanting “Allahu Akhbar” are not seen as insulting Islam—or hurting anyone’s feelings; reproach falls rather on those who identify the fact that the burners, bombers, and beheaders invoke Islam when they rampage.

This is not reform. It is a call for a new fundamentalism on the authority of a thirteen-hundred-year-old vicious fairytale, and for a ceaseless struggle against those who would criticize it. Indeed, the use of terror in fighting the enemies of Islam is directly sanctioned by the Koran:

Against them make ready your strength to the utmost of your power, including steeds of war, to strike terror into (the hearts of) the enemies, of Allah and your enemies, and others besides, whom ye may not know, but whom Allah doth know. . . . (8.60)

Genuine reform of Islam cannot occur without challenging the Koran itself. But this is the one thing that the Turkish theologians will not do. Indeed they have energetically denied western press reports that they are undertaking such reforms. The head of the ministry, Ali Bardakoğlu, stresses that "we are not reforming Islam; we are reforming ourselves, our own way of religiosity." And Dr. Mehmet Görmez, deputy director, said: "Our project is not aimed at effecting a radical renewal of the religion, as is claimed by the BBC.” A reporter, says Dr. Görmez, “distorted the facts” in making this claim.

We should take him at his word. Any “interpretation” of Islam that is consistent with the Koran as a revealed, unquestioned authority will end in a reversion to its brute, fundamental meaning: the subordination of women and non-Muslims to dictatorial rule by a clerical elite.

Posted in: Individual Rights and Law, Religion

Friday, May 9, 2008

The Morality of Capitalism

Posted by TOS Admin at 12:48 pm

Who: Eric Daniels, research assistant professor at the Clemson Institute for the Study of Capitalism and speaker for the Ayn Rand Institute

What: A talk explaining why capitalism is the only moral social system. A Q&A will follow.

Where: Hilton Costa Mesa, 3050 Bristol Street, Costa Mesa, CA 92626

When: Thursday, May 22, 2008, at 7:30 PM

Admission is FREE.

Description: Despite capitalism’s enormous success in producing material abundance and political freedom, it faces a crisis—one that may lead to its demise. Capitalism is perishing because its supposed defenders lack a real defense.

In this lecture, Eric Daniels explores the most common arguments in favor of capitalism. He finds that they all break down in the face of the popular argument that capitalism is immoral and destructive—because it is selfish. Dr. Daniels explains that only Ayn Rand’s crucial insight—that capitalism is the only moral social system because it is based on “the virtue of selfishness”—can truly defend capitalism. He illustrates the need for a moral, and not just an economic, defense of capitalism.

Bio: Eric Daniels is a research assistant professor at the Clemson Institute for the Study of Capitalism. He has lectured internationally on American ethics, on American business and legal history, and on the American Enlightenment. Dr. Daniels’s publications include a chapter in The Abolition of Antitrust and five entries in the Oxford Companion to United States History.

For more information on this talk, please e-mail events@aynrand.org.

### ### ###

Eric Daniels is available for interviews now and after his talk.
Contact: Larry Benson
E-mail: media@aynrand.org
Phone: (949) 222-6550, ext. 213

For more information on Objectivism’s unique point of view, go to ARI’s Web site at http://www.aynrand.org/. Founded in 1985, the Ayn Rand Institute promotes the philosophy of Ayn Rand, author of Atlas Shrugged and The Fountainhead.

Posted in: Announcements, Business and Economics, Events, Individual Rights and Law, Philosophy

Tuesday, May 6, 2008

The Threat of Totalitarian Islam: A panel discussion at Harvard University

Posted by ARI Media at 7:47 am

What: A panel discussion on the nature and threat of totalitarian Islam, followed by a Q&A

Who: Yaron Brook, executive director of the Ayn Rand Institute; Daniel Pipes, director of the Middle East Forum; and Robert Spencer, director of Jihad Watch

Where: Harvard University, Emerson Hall, Room 105, Cambridge, MA

When: Tuesday, May 6, 2008, at 7:30 pm

Admission is FREE. However, the organizers of the panel have informed us today that non-students must now RSVP in order to attend this event. If you are interested in attending, please RSVP to events@aynrand.org by 5 pm Eastern time tomorrow May 6.

Description: What is the nature of totalitarian Islam–is it limited to terrorism or is it a broader movement? Are non-Muslims its only victims? Who precisely is the enemy? Does the West bear responsibility for creating this movement? What policies can defeat it?

Defenders of Islam around the world have striven to silence critics with threats, protests and acts of violence. How should the West respond to demands for censorship, as in the Danish cartoon controversy?

Panelists will address these critical issues in a lively discussion.

Bios:

Yaron Brook is president and executive director of the Ayn Rand Institute and is a contributing editor to The Objective Standard. A former finance professor, he has published in academic as well as popular publications. He is frequently interviewed in the media and appears weekly on the new Fox Business Network to debate and discuss current economic and business news. His columns and opinion-editorials are published on forbes.com and in many major newspapers. Dr. Brook lectures on Objectivism, business ethics and foreign policy at college campuses, community groups and corporations across America and throughout the world.

Daniel Pipes is director of the Middle East Forum and a columnist for the New York Times Syndicate. Abroad, he appears weekly in Israel’s Jerusalem Post, Italy’s l’Opinione, Spain’s La Razón, and monthly in Australia’s and Canada’s Globe and Mail. His Web site, DanielPipes.org, is the single most accessed Internet source of specialized information on the Middle East and Islam. Dr. Pipes has appeared on ABC World News, CBS Reports, Crossfire, Good Morning America, NewsHour with Jim Lehrer, Nightline, O’Reilly Factor, The Today Show, the BBC and Al-Jazeera.

Robert Spencer is the director of Jihad Watch and the author of seven books on Islam and jihad, including the New York Times bestsellers The Truth About Muhammad and The Politically Incorrect Guide to Islam (and the Crusades). Spencer is a weekly columnist for Human Events and FrontPage Magazine, and also writes a weekly Qur’an commentary for HotAir.com. He has led seminars on Islam and jihad for the United States Central Command, United States Army Command and General Staff College, the Joint Terrorism Task Force, and the U.S. intelligence community.

For more information: e-mail media@aynrand.org

Please note: The above event is organized, hosted and sponsored by an individual campus club. Although ARI provides financial support, educational materials and speakers for eligible student clubs, campus clubs are organizations independent of ARI. ARI does not necessarily endorse the content of the lectures and sessions offered.

Posted in: Events, Foreign Policy and War, Religion

Thursday, May 1, 2008

Set Yahoo! Free by Alex Epstein

Posted by ARI Media at 3:00 pm

Yahoo! has just released its first-quarter earnings numbers, and neither the market nor analysts are impressed. What will be the company’s next move? Multiple suitors claim that they can leverage Yahoo!’s online products and talented employees better than Yahoo!’s widely criticized management is doing. The leading bidder is Microsoft, whose $40 billion offer it is prepared to take directly to Yahoo! shareholders via a proxy fight. Other proposals said to be in the running are an advertising collaboration with Google, a merger with AOL, and a possible deal involving News Corp (including MySpace).

The stakes are high. The right move could lead Yahoo! to a new level of innovation and profit, while the wrong move could cause the company’s value to plummet.

Unfortunately, the fate of Yahoo! will not be determined simply by who makes the best proposal to shareholders—but by whose proposal antitrust bureaucrats arbitrarily deem sufficiently "competitive."

Consider the Microsoft bid. If Yahoo! shareholders decide the Microsoft bid is best for their company, and want to move forward immediately with the challenging task of combining two companies with thousands of employees, they may be prohibited from doing so. Antitrust enforcers could hold up progress for months deliberating whether the merger is "anticompetitive"—and then possibly kill it altogether. Competitor Google is cheerleading this outcome, claiming on its official blog that "Microsoft plus Yahoo! equals an overwhelming share of instant messaging and web email accounts. And between them, the two companies operate the two most heavily trafficked portals on the Internet."

But a Microsoft and Yahoo! combined market share offers no threat to competition whatsoever—a fact that search-giant Google should know, given that the once-puny company was able to out-compete the once-dominant Yahoo! and the mighty Microsoft. Whether a market is competitive is not determined by the number of competitors or the percentage of customers that choose to buy their products; it is determined by whether companies are free to attempt to outdo one another to win over customers with superior products. The fact that someone is winning in a market by a large margin does not make the situation anti-competitive. It illustrates that competitive freedom has produced a company with superlative products.

Google, Microsoft, and Yahoo! have high market shares only insofar as their products are more appealing to consumers than are their competitors’. None of these companies, or any combination of two or even three of them, can force a single consumer to use its services instead of a more attractive search engine or web portal available—nor can it prevent competitors from outdoing it with superior products.

A Microsoft-Yahoo! combination could not threaten competition. To the contrary, it would be an act of free competition, an ambitious attempt by two companies to improve their products by combining strengths. What would actually stop competition would be to prevent the shareholders of these companies from making a move they regard as vital to their success.

The threat of antitrust prosecution is also impeding Google’s own efforts to make a deal with Yahoo!. Google has proposed that Yahoo! outsource its search advertising to Google, a move that some analysts say could boost Yahoo!’s ad revenue by 25 percent. Unfortunately, if Yahoo! agrees to the deal, the government will likely kill it because, once again, the companies have a high combined market share. According to Reuters, "Antitrust experts said regulators would likely oppose any permanent alliance between Google and Yahoo." And, just as Google is calling Microsoft’s bid anti-competitive given its market share, Microsoft is saying the same of Google: "Any definitive agreement between Yahoo and Google would consolidate over 90 percent of the search advertising market in Google’s hands," Microsoft’s general counsel complained. "This would make the market far less competitive."

In reality, no deal between Google and Yahoo! is a threat to anyone besides inferior competitors; neither company can force even one person to click on http://www.google.com/. Yahoo! should be able to field and accept any offer from Google it chooses—including a full-blown acquisition. Indeed, it is very possible that if cash-rich Google were not terrified of antitrust prosecution, it, like Microsoft, would try to acquire Yahoo! outright. Such a deal might be Yahoo! shareholders’ best option and make possible a whole new level of Internet content—but under antitrust, it won’t even come to the table.

What we are observing in the battle over Yahoo! is not genuine, merit-based competition, but competition based on political pull. He who cajoles antitrust bureaucrats to endorse his deal and stop his competitors, wins.

Instead of attempting to outdo one another in crying to the government, Google and Microsoft should take a principled stand in favor of open competition for Yahoo!—a competition in which the company’s fate is decided by who makes the best business proposal and not who has the craftiest lobbyists and lawyers.

More broadly, they—and we—should call into question the antitrust laws that make competition-by-pull possible.

Alex Epstein is an analyst at the Ayn Rand Institute, focusing on business issues. The Institute promotes Objectivism, the philosophy of Ayn Rand—author of Atlas Shrugged and The Fountainhead.

Posted in: Business and Economics

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Archive for May 2008