In his blog article today, Austrian school economist Detlev Slichter offers a very cogent argument that reinforces my opinion that:

  1. the U.S.A. is facing what is most likely an economic setback that will be comparable in intensity, and probably scope, to the Great Depression of the 21st century., and,
  2. that the likelihood that we can avoid such a setback, absent divine intervention, is becoming vanishingly small, irrespective of which of the two major candidates wins the Presidency in November.

I wish I were able to see an alternative future, but I am not. Read the whole article there.

Journalist and author Robert Neuwirth had some interesting remarks in a talk at TED about the “informal economy”. It seems that not a few corporations, including some large international ones, are more interested in meeting consumers demands for their products than in enforcing their intellectual property (IP) rights. They have recognized the scale and power of markets, which suggests that truly free markets are not the cause of our economic woes, at least when they are operated under the Rule of Law and the strict enforcement of real property rights, freedom of association, and freedom of exchange.

H/T: Jeffrey Walker (via FB)

On the Saturday of this year’s Labor Day weekend, Andrew F. Puzder, CEO of CKE Restaurants, Inc., parent corporation of franchise restaurant’s Hardee’s and Carl’s Jr., was a guest on the Tom Sullivan Show (Fox Business Network). Mr. Puzder is also a senior economic adviser with Gov. Mitt Romney’s campaign. To me, the most interesting aspect of Mr. Puzder’s comments to Mr. Sullivan concerned the costs of PPACA to his corporation. The facts he presented, with the estimated costs of PPACA provided to him by the corporation’s healthcare consultant (the nation’s largest such firm), were as follows:

• CKE’s expenditures on healthcare coverage for employees in its most recent year was about $12 million.
• During that same period, CKE spent about $8.8 million on new restaurants, the sole significant means by which CKE, and its franchisees can grow the size of their businesses and hire more people.
• Each new restaurant employes about 25 people.
• A significant number of franchisees operate more than one restaurant as a part of their business.
• CKE has franchisees who would like to open additional restaurants as part of their business.
• CKE’s consultants best estimate of the first year’s increase in healthcare costs under PPACA will be about $18 million, or in other terms, more than twice what they spend in one year on new restaurants.

To fully appreciate the impact one needs to be aware that PPACA requires any non-exempted employer who employs “more than fifty full-time equivalent employees” (parentheses in original) either (a) to provide comprehensive healthcare coverage (as defined by the Secretary of Health & Human Services) to its employees, or (b) to pay a per-employee and per-day fine, if it does not provide such coverage. Summarized details of PPACA definitions and employer penalties can be found in this Congressional Research Service report.

To put the cost of current healthcare in perspective, one also needs to have a sense of the average amount paid by private industry employers for the insurance costs of their employees. The Bureau of Labor Statistics report for March 2012 indicate that the employer cost in that sector averaged 7.7% of total compensation, with variations among occupational categories ranging between 6.5% and 9.9%.

From the foregoing, and assuming that CKE’s consultant is correct about the order of magnitude of increases to employer costs, it should be readily apparent that PPACA (Obamacare) will likely ensure a serious prolongation in the duration of the current recession, and could conceivably be the trigger for a descent into economic depression.
PPACA is, quite simply, an unaffordable creation by a group of people (i.e., our elected Federal representatives) who have no understanding of simple arithmetic. Mrs. Pelosi has been granted her wish—the bill has been passed and signed into law by our sitting President, and we are now beginning to find out what is in it. If it is allowed to stand, the United States will become, in the foreseeable future, a second (if not third) world nation.

On 26 April 2012 HHS Secretary Kathleen Sebelius, a self-described Catholic (bio here), testified before Congress about the Affordable Care Act (more commonly referred to as Obamacare). During that testimony

a number of questions were put to her by Rep. Trey Gowdy (R-SC, 4th Dist.) concerning a statement she had made with regard to that act’s controversial Healthcare Mandate, to wit [emphasis added]:

this decision was made after very careful consideration, including the important concerns some have raised abouit religious liberty. I believe the proposal strikes the appropriate balance between respecting religious freedom and increasing access to important preventive services.

Addressing myself directly to the character and content of her answers, which I can only assess as demonstrating a cavalier approach to the formulation of what she terms an “appropriate balance” in determining who may be exempted from the essentially absolute requirements of the Mandate (recall that nearly all employers will be required to provide all of their female employees with employer-paid coverages in their healthcare benefits package that includes “female reproductive services” which are (a) not intended to prevent a disease or unhealthy medical condition, and (b) to the provision of which the employer may have sincere and strongly held moral objections.) I am thus led to the question I have posed as the title in this post.

And that question is, “Just how competent and/or qualified is a Cabinet Secretary who does not seek out all available counsel as to the legality and constitutionality of a decision that has such far-reaching implications as requiring a third party to pay for a service which that third party may reasonably see as a grave evil (abortion and abortifacient drugs,1 to cite two examples).
Read the rest of this entry »

My objective in writing this blog is to counter an erroneous idea I have encountered, and anticipate I will continue to encounter, on a variety of Catholic and other Christian blogs. Namely, that being Austro-libertarian in one’s political and/or economic principles (as opposed to being a member of the Libertarian political party) is axiomatically incompatible with being a faithful Catholic who is loyal to the teachings of both the universal and special magisteria of the Catholic Church.

The error in question arises from a number of misunderstandings. One of the misunderstandings arises from the confusion of poorly catechised Catholics who believe, whether explicitly or implicitly, that the teachings of the Holy Fathers embodied in specific encyclicals on particular secular subjects are infallible, despite the fact that such teachings are neither given ex cathedra nor on matters specifically of faith or morals. Other errors arise from a fundamental misunderstanding of the varieties of libertarianism, many of which are in conflict with Catholic and general Christian teaching. It is my hope that in writing about the application of the principles to which God has led me over more than four decades of individual study, I will both refine the results of my own personal actions and words in living out my faith, and simultaneously encourage others to examine how their alternative principles comport with what Christ asks of us, with the result is that, not only I, but anyone who reads or comments here, might actually increase their understanding of how the world works in the arena of economics and politics, and of the ways in which we might better live out the teachings of our Lord.

In pursuing the above purpose I intend to address from an Austro-libertarian Catholic perspective, issues of liberty, economics and politics that are in the public eye. I welcome any contributions from readers that are civil and respectful.

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