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I’m Ambivalent on the Bundy Ranch Case

800px-Cattle_near_the_Bruneau_River_in_Elko_County,_Nevada[A follow-up this Mises Daily article.]

I think we can all agree the Feds, in their usual fashion, have employed unwarranted thuggery in their attempts to shut down the Bundy Ranch. Just as the Feds could have arrested David Koresh when he left his compound (which he often did) they instead chose to employ the usual shock-and-awe tactics that are so beloved by federal agents.

Bundy lost his case in federal court, and he lost the appeal, so as Judge Napolitano points out here, the feds could simply have put a lien on the property, but they instead resorted to violence by stealing cattle and knocking around protestors.

As far as the legal case goes, however, it’s pretty clear that Cliven Bundy has unambiguously lost his case as far as federal law goes. Bundy has already made it clear that, at least at some point, he thought the feds had a right to charge management fees, since he did it for many years before stopping twenty years ago.  He has tied his refusal to pay fees not to the fact that the feds own or manage the land, but that it now manages in a way that does not meet his approval. In other words, a government entity that manages the land properly, would deserve payment, according to Bundy’s own account.

Meanwhile, the issue of government ownership itself is not an issue, it seems, since Bundy has declared that he would pay fees if the land were administered by the state of Nevada.

While I delight in the images of  federal troops being thwarted in their recent attempt to bully Bundy and his allies, I’d be more understanding if Bundy were calling for outright privatization rather than what he appears to be calling for: a mere modification of the status quo in which Nevada rather than the US takes control of the land in question. Remember that Bundy only disputes ownership by the federal government. Government ownership in general is apparently fine. Bundy then attempts to base this assertion on his belief that the US government cannot legally own land, which is a sketchy argument at best.

This is a fool’s game, of course, as understood by anyone who realizes that the US Constitution (apart from the Bill of Rights) is not now and (and possibly never has been) designed to actually limit the power of the federal government. (As Rothbard explains here.)

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Reducing the American citizen to a status of subject

Frank Chodorov

Frank Chodorov

When the Sixteenth Amendment was ratified just over a century ago, there was no concern that IRS abuses would extend to 501c4 applications for nonprofit status from groups “unfriendly” to the administration in power. Such tax code proliferations were never anticipated. Careful observers of the income tax from the perspective of American ideals and history, such as Frank Chodorov, focused on how income taxation would undermine Americans’ liberty. As he put it in The Income Tax: Root of all Evil:

 The American Revolution…[established] a government based on a new and untried principle, namely, that the government has no power except what the governed have granted it…in 1913, when the government was invested with the power to confiscate private property…this power…put into the hands of the American government a means of liquidating the sovereignty of the citizenry.

While Chodorov’s focus was on how the income tax would undo the American Revolution’s central protection of citizens and their property against federal violations, he also saw that enforcement of the income tax would bring evils in its train. April 15 reminds us of that fact. But those predictable evils also coincide strikingly with the IRS’ targeting of groups who object to the abuses it enabled, as if Chodorov was writing about these “new and improved” abuses six decades ago.

 [T]he Sixteenth Amendment, enacted to increase the government’s revenues, has spawned another police department, another means of forcing the citizen into line.

“The imposition of the [income] tax will…necessitate a swarm of officials with inquisitorial powers…and cannot be fairly imposed¼” -REPRESENTATIVE ROBERT ADAMS, January 26, 1894.

The Internal Revenue Bureau quite sensibly takes the view that every one of us is a potential lawbreaker…it must make use of…espionage, deception, and force…

[T]he inevitable consequence…is the use of income taxation to undermine the principles of republican government and to make a mockery of our tradition of freedom.

The Internal Revenue Bureau is a self-operating inquisitorial body. It has the means of harassing, intimidating, and crushing the citizen who falls into its disfavor...Therefore, whenever the Bureau has reason to “get” somebody it has ample means at its disposal.

This is what the late Senator Schall of Minnesota had to say…“The one glaring governmental agency that constitutes a menace to the citizens is the Income Tax Bureau, which often goes outside the constitutional limitations and frequently harasses citizens by unjust exactions and by the oppressive conduct of its agents…it even dares to attack the citizens…without substantial pretext or cause¼The bureau is inquisitorial…Its forces swarm over the country…Agents, spies and snoopers annoy and plague the citizens…[it] permits and promotes, if it does not direct, a species of blackmail against the American citizen.”

There have been cases…where citizens who have offended the party in power were suddenly visited by agents of the Bureau and subjected to interrogation and examination. Of course…there is no proof that the citizens’ views prompted these special investigations. It cannot be proved that the purpose was to silence opposition. But the practice is so well known that men…have scrupulously avoided involvement in movements critical of the Administration, even though privately they are in sympathy with such movements.

[I]f individuals persist in trying to circumvent the political establishment…or if they preach doctrines inimical to the interest of the ruling group, then…freedom of thought must be suppressed.

Despite all the stonewalling, denials and rhetorical dancing offered by the Obama Administration, it is clear that the IRS employed abusive and intimidating tactics against “Tea Party” and other groups unfriendly to their employer’s agenda.  And it is hardly a surprise that the IRS’ power has been used yet again on behalf of big government. It is just one more mechanism by which the power of the income tax has, in Frank Chodorov’s words “reduced the American citizen to a status of subject.”

More Photos from Friday’s Inflation Seminar

Featuring some students from Andrew College (of Georgia):


(Thanks to Breanna.)

Video: ‘What is Money?’ with Mark Thornton

Presented at “Inflation: Causes, Consequences, and Cure”: a free seminar for high school and college students. Hosted at the Mises Institute in Auburn, Alabama, on 11 April 2014.

Another Phony Budget Debate

spendingBy Ron Paul

Anyone watching last week’s debate over the Republican budget resolution would have experienced déjà vu, as the debate bore a depressing similarity to those of previous years. Once again, the Republicans claimed their budget would cut spending in a responsible manner, while Democratic opponents claimed the plan’s spending cuts would shred the safety net and leave vital programs unfunded. Of course, neither claim is true.

The budget does not cut spending at all, and in fact actually increases spending by $1.5 trillion over ten years. The Republicans are using the old DC trick of spending less than originally planned and calling that reduced spending increase a $5.1 trillion cut in spending. Only in DC could a budget that increases spending by 3.5 percent per year instead of by 5.2 percent per year be attacked as a “slash-and-burn” plan.

The budget also relies on “dynamic scoring.” This trick is where the budget numbers account for increased government revenue generated by economic growth the budget will supposedly unleash. The claims are dubious at best. Of course, reducing government spending will lead to economic growth. But real growth requires real cuts, not this budget’s phony cuts.

As important as reducing spending and balancing the budget is, focusing solely on budget numbers ignores the root of the problem. The real problem is that too many in Washington — and the nation as a whole — refuse to consider any serious reductions in the welfare-warfare state.

I have always maintained that the logical place to start reducing spending is the trillions wasted on our interventionist foreign policy. Unfortunately, there are still too many in Congress who claim to be fiscal hawks when it comes to welfare spending, but turn into Keynesian “doves” when it comes to spending on the military-industrial complex.

These members cling to the mistaken belief that the government can balance it budget, keep taxes low, and even have a growing economy, while spending trillions of dollars policing the world, and propping up some governments and changing others overtly or covertly. Thus, President Obama is attacked as soft on defense because he only wants to spend $5.9 trillion over ten years on the military. In contrast, the Republican budget spends $6.2 trillion over the next decade. That is almost a trillion more than the budget’s total so-called spending cuts.

If there are too many fiscal conservatives who refuse to abandon the warfare state, there are too many liberals who act as if any reduction in welfare or entitlement spending leaves children starving. I agree it is unrealistic to simply end programs that people are currently dependent on. However, isn’t it inhumane to not take steps to unwind the welfare system before government overspending causes a bigger financial crisis and drags millions more into poverty?

Far from abandoning those in need of help, returning the responsibility for caring for the needy to private charities, churches, and local communities will improve the welfare system. At the very least,  young people should have the freedom to choose to pay a lower tax rate in exchange for promising to never participate in a government welfare or entitlement program.

Last week’s budget debate showed how little difference there lies between the parties when it comes to preserving the warfare-welfare state. One side may prefer more warfare while the other prefers more welfare, but neither side actually wants to significantly reduce the size and scope of government. Until Congress stops trying to run the world, run the economy, and run our lives, there will never be a real debate about cutting spending and limiting government.

[The Ron Paul Institute]

Beginning Tomorrow: Understanding Monetary Chaos at Mises Academy

SalernoFreeBookAdSPECIAL OFFER: Enroll before the first lecture, and receive a free hardback copy of course text The Mystery of Banking by Murray N. Rothbard, signed by Joseph Salerno, author of the introduction, and instructor of this course.

After enrolling, just email your name and address to (This offer applies to students who enrolled before this announcement as well.)

The purpose of this course is to illustrate how Austrian monetary economics is used to analyze historical and current events and policies. The course will also cover controversies between Austrian and mainstream monetary theorists in interpreting the causes, consequences, and remedies for important episodes of monetary disorder. Topics will include:

  • Rothbard Versus Friedman: Were the 1920s Inflationary? Were the 1930s Deflationary?
  • Deflation: Good or Bad?
  • The War on Cash
  • Who or What Caused the Financial Crisis and Great Recession?
  • Beware of False Gold Standards: From Bretton Woods to the Dollar Bill Standard
  • World Currency Wars: Who Will Win and Who Will Lose?


Lectures will be Tuesdays at 5:30 p.m. Eastern time.  They will be recorded and made available for enrolled students to download.

Register here. 

Audio: Joseph Salerno Talks Monetary Chaos

downloadInterviewed by host Tom Woods, Joe Salerno talks about the Fed, the Great Depression, currency wars, deflation, and why governments hate cash.


Ranchers and Empire in the American West

blmRyan McMaken writes in today’s Mises Daily:

The image of the American West as a place of private property and blissful independence from government control has long been a myth, and the fact is that life in the West has involved the federal government much more so than life in the East much of the time. This is because the land and other natural resources in the West are controlled by a vast socialist bureaucracy governing water, land, and minerals going back to the late nineteenth century.

The rise of the Bureau of Reclamation (which managed water) and the Bureau of Land Management ensured that both water and land would be controlled either directly or indirectly by federal government agencies indefinitely. Whatever the philosophical origins, the situation quickly degenerated into the all-too-familiar situation seen anywhere that the state dominates and controls the distribution of resources.

Video: Matt Drudge and Information Overload

For the text version, see today’s Mises Daily. 

Presented at “Inflation: Causes, Consequences, and Cure”: a free seminar for high school and college students. Hosted at the Mises Institute in Auburn, Alabama, on 11 April 2014.