From the “Preface to the English Edition” of “The Theory of Money and Credit” by Ludwig von Mises: “All proposals that aim to do away with the consequences of perverse economic and financial policy, merely by reforming the monetary and banking system, are fundamentally misconceived. Money is nothing but a medium of exchange and it completely fulfills its function when the exchange of goods and services is carried on more easily with its help than would be possible by means of barter. Attempts to carry out economic reforms from the monetary side can never amount to anything but an artificial stimulation of economic activity by an expansion of the circulation, and this, as must constantly be emphasized, must necessarily lead to crisis and depression. Recurring economic crises are nothing but the consequence of attempts, despite all the teachings of experience and all the warnings of the economists, to stimulate economic activity by means of additional credit.

Mathematicians of the day.

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The Case Against Hope for the US

The Ludwig von Mises Institute recently published “Why I Have Hope” by Ron Paul. Here, Paul makes an optimistic case for libertarianism in the US. As much as I admire Paul and all that he has done for the cause of liberty, I believe that he is delusional. I don’t see any hope for the cause of liberty in the US. The best that can be hoped for is to slow down some of the more outrageous aspects of the depredations of the state.

In Arizona, It’s Illegal to Hold Potlucks at Home” is a recent article published by the heroic Institute for Justice about attempts to combat this insane regulation. For my non-US readers, potlucks are communal meals held by neighbors, churches, etc. in which the participants bring prepared food for the meal. There is no need to point out how absurd this is. What is important is that organizations like the Institute for Justice are engaged in a hopeless game of whack-a-mole. The US is littered with such absurd laws, so attempting to combat them is a noble way to enhance liberty, but it is ultimately futile, as I will outline shortly.

The Tenth Amendment Center does outstanding work to promote liberty by supporting state legislation to effectively nullify federal regulations. As the center and others have realized, the federal government is completely reliant on the cooperation of state and local governments to enforce most federal regulations. The states have always had the right to refuse to cooperate and thus effectively nullify regulations. While such a strategy has had some notable recent successes, such as marijuana legalization, it is doomed to the same whack-a-mole problem as cited above. The never ending avalanche of federal rules and regulations means that those engaged in these nullification efforts will fall ever further behind as the rate of new regulations swamps them.

Image from: https://regulatorystudies.columbian.gwu.edu/sites/regulatorystudies.columbian.gwu.edu/files/downloads/total-pages-code-of-federal-regulations-2014_0.png

The fundamental reason why such commendable efforts to promote liberty are ultimately futile is that the US is fiscally unstable. To quote from my post “From Pensions & Investments: Cities with high unfunded pension liabilities“:

I like to use the term “financially unstable” to describe the plight of the US. While many pundits focus on the $18 trillion prompt debt of the federal government and fewer focus on the $100 to $200 trillion of net present value of liabilities, even fewer focus on the debts and liabilities of states, counties, and cities. To handle such unpayable debts, there will be a combination of tax increases, inflation, and defaults.

I should have mentioned that governments, especially local ones, will resort to increased and additional fees and fines with more aggressive enforcement to collect revenue. This is what will ultimately doom the efforts highlighted above. We already witness multiple articles about cities that act like megalomaniacal home owners associations by levying fines for mismatched curtains, unpainted shutters, vegetable gardens, etc. As governments become ever more desperate to meet pension and bond payment obligations, they will continue to pass even more absurd regulations that result in fines.

I fail to see how liberty has a chance in a nation facing unpayable debts at every level of government.

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The Tom Woods Show: Episode 589 – Milton Friedman: Assessment and Critique, with Walter Block

It’s considered bad form to criticize Milton Friedman — why, you must be some kind of “libertarian purist”! But if you can’t be a libertarian purist on the Tom Woods Show, where can you be? Walter Block and I look at the good and the bad about Milton Friedman.

Additional information can be found at the show notes page.

This was a very good discussion about some decidedly non-libertarian views held by both Milton Friedman and Friedrich Hayek. Note that the criticisms of Block and Woods are not that Friedman and Hayek were not anarco-capitalists/voluntaryists, but that they were not even consistent advocates of a minarchist classical liberal night watchman state. Such views are undeniable and clearly demonstrated in the major political economy writings of these men. Thus it is somewhat odd that some libertarians are so quick to criticize other libertarians who point out failings and inconsistencies in Friedman and Hayek.

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The Central Planning Mindset Has Won by Paul-Martin Foss

If you thought the Soviet Union’s collapse meant the end of central planning, you were wrong. Central planning is alive and well. In fact, it’s even stronger now than it was during the Soviet Union’s heyday. What’s even more disturbing is that many who would strongly oppose Soviet-style central planning and who consider themselves to be defenders of free markets fail to recognize their acceptance of central planning and see no contradiction between their acceptance of central planning and their alleged support of the market economy.

What is monetary policy anyway other than centralized economic planning? The central bank sets a certain target interest rate and buys and sells assets to achieve that target, creating money out of thin air to do so. This is nothing more than price-fixing. It may not be as total a price-fixing scheme as occurred behind the Iron Curtain, but it is price-fixing nonetheless, with all the subsequent negative effects that result. Only this time the prices being manipulated are interest rates, the prices of money and credit, perhaps the most crucial prices to a developed economy. These prices coordinate savings and investment throughout the economy, so that if they are manipulated the entire structure of the economy is distorted.

But so many people fail to understand that monetary policy is price-fixing. Many fervent advocates of the market economy, who may decry minimum wages, rent control, trade barriers, or other economic interventionism and price-fixing, have a huge blind spot when it comes to monetary policy. That’s despite the fact that the Federal Reserve’s dual mandate in federal law decrees that the Fed is to assure full employment and stable prices. Do they honestly expect the Fed to be able to try to achieve those goals without manipulating prices?

Politicians don’t understand monetary economics and neither do most businessmen. (Neither, for that matter, do most economists, but that’s a story for another day.) They don’t want to delve too deeply into the details, but the Federal Reserve hasn’t completely destroyed the economy yet so they can’t be doing too badly, right? In a way, these politicians and businessmen treat monetary policy as though it’s magic. Just let the central bankers meet in their secret rooms and do what they want with the economy and everything will turn out just hunky-dory. And when it doesn’t? Well, the politicians will have moved on to higher office, the CEOs will have retired, and everybody who’s stuck suffering during the recession wonders why this keeps happening. It will continue to happen until the mindset that an economy can be centrally controlled is no longer taken seriously in politics, business, or academia. As long as the myth that a handful of mandarins can guide the economy and produce economic growth, this destructive cycle of booms and recessions will continue to repeat itself.

The entire article can be read here.

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From Medgadget: Bioabsorable Waveguide Helps PTB Seal Tissues Deep Below Surface

A more informative title would be “The use of a laser and a photosensitive dye as a suture for wounds”.

Photochemical tissue bonding (PTB) is a light-based method to repair tissues and is an alternative to traditional sutures and staples used to close wounds. Unlike the latter, PTB does not cause inflammation and scarring at the repair site. PTB works by applying light-sensitive Rose Bengal dye to the exposed tissue. When the dye is exposed to green light, the dye absorbs the light, thereby causing the tissue to crosslink and form a water-tight seal. While PTB can seal incisions sans inflammation, the technique is limited by how deep the light can penetrate the tissue. Researchers from the University of St Andrews and Harvard Medical School have developed a bioabsorable optical waveguide, which can deliver light deep into tissues before being absorbed.

In a study published in Nature Communications, researchers fabricated optical waveguides from a variety of polymers, but ultimately tested the degradation times of the polymers PVP and PLGA (50:50) in vivo. They inserted 1 x 5 mm x 500 µm pieces of bulk polymer subcutaneously in mice and examined the implant at different time points. The PVP waveguide dissolved within one hour of implantation, whereas the PLGA polymer began to lose shape after 17 days, illustrating that researchers can tune the degradation time (ranging from hours to days) of the optical waveguide for a specific application.

The rest of the article can be read here.

Below is the abstract of the paper “Bioabsorbable polymer optical waveguides for deep-tissue photomedicine“. The entire paper can be found at the link.

Advances in photonics have stimulated significant progress in medicine, with many techniques now in routine clinical use. However, the finite depth of light penetration in tissue is a serious constraint to clinical utility. Here we show implantable light-delivery devices made of bio-derived or biocompatible, and biodegradable polymers. In contrast to conventional optical fibres, which must be removed from the body soon after use, the biodegradable and biocompatible waveguides may be used for long-term light delivery and need not be removed as they are gradually resorbed by the tissue. As proof of concept, we demonstrate this paradigm-shifting approach for photochemical tissue bonding (PTB). Using comb-shaped planar waveguides, we achieve a full thickness (>10 mm) wound closure of porcine skin, which represents ~10-fold extension of the tissue area achieved with conventional PTB. The results point to a new direction in photomedicine for using light in deep tissues.

H/T Paul Hsieh.

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A Weekly Dose of Hazlitt: 20 Ways to Giveaway

20 Ways to Giveaway” is the title of Henry Hazlitt’s Newsweek column from September 15, 1958. While US government bribes to corrupt foreign officials, so called foreign aid, has greatly diminished in real dollar terms since Hazlitt’s day, it still continues. Hazlitt points out that such welfare does not help recipient nations and is an affront to the hapless American tax payer. How such a scam can continue for decades says a lot about the nature of the modern nation state.

Administration policy is difficult to follow. On Aug.
27, President Eisenhower told reporters that he would
campaign for a Republican Congress this fall on the
issue of “getting down these deficits and keeping our
money sound.” On the same day he deplored the cut by
Congress in foreign-aid spending as “my greatest disappointment.”
On the day after that, the Administration
announced it would participate in a $350 million aid
plan to keep India’s grandiose socialistic development
program afloat. And on the day before that, in
an exchange of letters with Secretary Anderson, the
President had urged a still further addition to an expansion
of government agencies devoted to pouring U.S.
taxpayers’ money into foreign countries.

There is already a bewildering maze of agencies
for this purpose. There is the World Bank, the
International Monetary Fund, the International
Finance Corporation, the U.S. Export-Import Bank,
the Development Loan Fund, the Agricultural Trade
Development and Assistance Act. Now the Secretary
and President propose to set up still another agency, an
International Development Association, to make “loans”
so soft and dubious that even the existing government
agencies are forbidden to make them. In addition, larger
U.S. Government guarantees are to’ be made to the
World Bank and still more money is to be poured into
the International Monetary Fund.

All Piled on Top

The proposal to expand the facilities of the Bank and
the Fund might have something to be said for it, as
a transitional measure, if it were meant to replace our
foreign-aid program. But there is not the faintest suggestion
of such a replacement; all these new schemes
are to be piled on top of existing foreign aid. And that
foreign aid—which in all forms has already run to more
than $60 billion since the end of the second world war—
is presumably to be itself enlarged and perpetuated.

What is the purpose of all this aid? Does experience
show that the aid has helped to accomplish its purpose?
The President’s letter declares that two of the purposes
are to encourage “financial policies that will command
the confidence of the public, and assure the strength of
currencies” and “to avoid hampering restrictions on the
freedom of exchange transactions.”

We have now had these institutions and foreign
aid for more than a decade. The public never had less
confidence in the financial policies of governments. If
this were not so, governments could borrow all they
really needed from private sources. Inflation is still rampant
everywhere. The war that gets the blame ended
more than a decade ago. Latin America, where some
of the worst inflations are still going on, was relatively
untouched by the war. Restrictions on the freedom of
exchange transactions were never more widespread.
They are all but universal. They are built into the very
concept of the International Fund.

Rescuing Socialism

The truth is that not only have the Fund and foreign
aid done nothing to cure this condition; it exists largely
because of the Fund and foreign aid. If the restrictionist,
spendthrift, and socialistic governments of the world
did not know that these guardian angels were standing
by to rescue them from the results of their own folly,
if they knew that there would be nobody to go to but
hardheaded private lenders with a prejudice in favor of
getting their money back, or of getting solid guarantees,
they would long ago have been forced to return to the
path of fiscal sanity. In brief, dramatic “rescues” effected
by the Fund and our own foreign aid have encouraged
the very socialistic planning and fiscal irresponsibility
that have made the rescues necessary.

Instead of adding further to our foreign-aid and
intergovernment lending institutions, which subsidize
foreign socialism, inflation, and exchange control, we
should be thinking of how to taper off and terminate
such programs; how to stop confusing political with
economic goals, and how to return the business of foreign
investment to private hands. Not until we have
done this will the world get back to stable, hard, and
convertible currencies, to private enterprise, and to real
economic progress.

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Political Economy Quote of the Week for 20160208

“… before capital can actually be formed, the productive powers necessary to its making must be saved …” – Eugen von Böhm-Bawerk, The Positive Theory of Capital.

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From Fight Aging!: The SENS Rejuvenation Biotechnology Companies

The Fight Aging! blog lists some companies that are implementing some of the SENS anti aging ideas. The fact that this research is being commercialized is excellent news.

Numerous lines of SENS rejuvenation research are, piece by piece, leaving the laboratory for the startup world. This is the success we have achieved with our years of charitable support for research aimed at advancing the state of the art. Whenever a new SENS-related biotechnology startup launches, bear in mind that a diverse group of people, investors and researchers, have looked at the technology and said “yes, we think can get a prototype therapy for human trials done in a couple of years.” It is an important sign of progress, and one that is hard to fake: people with meaningful amounts of money on the line made those calls. You should expect our community to transition in part from one of fellow traveler non-profits and research groups to one made up equally of a network of startups, entrepreneurs, and investors of various stripes, from occasional angels to professionals at venture funds.

Here is a short list of interesting companies I am aware of that are working on SENS-related therapies at various stages, some very new, some years old, and proceeding at differing paces and with different strategies for development.

Gensight

I’ve posted on the topic of Gensight in the past. This is a French company with tens of millions in venture funding that is built on technology for allotopic expression of mitochondrial genes originally partly funded by the SENS Research Foundation. They are focused on generating a robust commercial implementation for one mitochondrial gene, initially to deploy gene therapies to treat hereditary mitochondrial disease. Creating such a robust implementation is an important foundation for a future effort in which all mitochondrial genes can be backed up to the cell nucleus, and thus the contribution of mitochondrial DNA damage to aging can be eliminated.

Human Rejuvenation Technologies

Human Rejuvenation Technologies is a venture run by philanthropist Jason Hope, who you may recall funded a sizable chunk of the ongoing work on glucosepane cross-link breaking at the SENS Research Foundation back a few years ago. Glucosepane cross-link breaker drug candidates seem to be a few years in the future yet, so Human Rejuvenation Technologies is instead working with a drug candidate for clearing a form of metabolic waste key to plaque formation in atherosclerosis. This candidate is one of the results produced by the long-running SENS Research Foundation LysoSENS program.

Ichor Therapeutics

Ichor Therapeutics has been around for a couple of years, and has done a good job in setting a sustainable lab business on the side. The interesting work here, however, is the continuation of SENS research programs aimed at removing the buildup of A2E, one of the components of lipofuscin that builds up in cells and interferes with cellular garbage disposal. Unusually among the forms of cellular damage, even those involving buildup of metabolic waste such as lipofusin, A2E is linked very directly and solidly to some forms of age-related disease that involve retinal degeneration. In most cases the fundamental damage that causes aging is separated from the end stage of disease by lengthy and barely understood chains of cause and consequence, but here it is very clear that getting rid of A2E is a good thing.

The entire article can be read here.

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