[Does anyone have a recommendation for...?]

Try A History of Money and Banking in the United States by Murray N. Rothbard.

Also by the same autor is another book that documents the Fed and its history. It is called The Case Against the Fed.

[The Shah: Is Supporting a Dictatorship Moral?]

It is simply a matter of poor foreign policy for a government to intervene on behalf of an entity which had its right to own property violated in a country that does not respect property rights. All that the interceding government is able to do is take back the property and install a regime that is friendly to its own interests. This does not address the true problem, and will result in undesirable consequences for the interceding government because the philosophic undercurrent opposed to property rights will remain in the country, irregardless of who is put in charge.

Any free nation has the right to kick the ass of a rights-violating dictatorship.

Let us suppose for a minute that I agree with this statement. It can still be shown that this does not necessarily lead to the conclusion that a free nation should intervene. What I am submitting to you is that it is not in the best interests for a government to intercede, because it will lead to widespread resentment of the interceding government by the people of the country, who still believe that the concept of property rights is philosophically incorrect. This resentment will end up costing the government of the interceding country more than it gains by interceding. The key fact here is that it is not possible to change widespread popular ideas within an irrational (or rational) culture by force.

From the Wall Street Journal Op-Ed page on Monday the 19th of November there was a relevant editorial about the current state of Argentina. Just to quote from it quickly:

The [Argentine] government needs to raise $7 billion in the capital markets next year and an estimated $10 billion in 2009. Meanwhile, the flight to quality since the subprime debacle has pushed up Argentine borrowing costs. In a 10-year dollar-denominated domestic bond offering issued last week, it had to pay 10.5%. By comparision, Brazilian 10-year bonds yield 5.6%. In other words, Argentina's creditors are demanding almost five percentage points over Brazil to cover the risks of the unsustainable economic agenda of a government that thumbs its nose at property rights, contract security and free prices. The $22 billion of bonds held by the private-sector and still in default don't help either.

Peronists [the ruling political party] still insist that market economics are part of a right-wing "neo-liberal" plot. In other words, they have a lot to learn. The international community can help by letting them learn it on their own.

The Argentine government openly stated in 2000 that it will not be paying interest or principal to any bond investors. If one had loaned the Argentine government money by purchasing bonds in the 90's, then one would have received back less than 30 cents on the dollar after waiting years, if one was lucky. A stubborn refusal to pay back borrowed money is a clear violation of the property rights of creditors all over the world. Indeed, under United States law, creditors are the first to be paid (sometimes by claims on property) when a company or district is in bankruptcy. After Argentina defaulted on its bonds, a major financial crisis could have been triggered in many Western countries whose banks and hedge funds held these bonds. Do you hold that governments should have interceded on behalf of these creditors?

[The Shah: Is Supporting a Dictatorship Moral?]

By owning shares of the company. I will try to provide documentation (after the break, unfortunately).

Were you able to locate this?

[1983: Ron Paul Debates Federal Reserve Governor Charles Partee]

You guys should watch this debate. Nice to see someone in office at least advancing ideas of Austrian economics.

If you do not have time to watch all 7 parts, I would recommend watching part 5.

"My real concern is about paper inflation. You know, they say, watch out for Russia; they could withhold gold or dump gold. It would take them 100 years to double the supply of gold in the country, therefore really significantly affecting the purchasing power of gold. It took the Fed only 10 years to nearly triple M3."

[Being a "cool" person]

Usually the coolest and most interesting people will not be found at typical parties. But, to summarize the type of personality I think you are describing: this type of person usually has a body language that implies he is comfortable with himself. He does not hesitate to approach anyone he desires to speak with, but he never appears to be "trying hard" to make friends or to be accepted. Moreover, he always has a very witty and clever sense of humor, and a different way of looking at things. Also, he has a way of identifying with all people and making them feel comfortable around him. He does this because he has a vast array of knowledge, including knowledge of why people act the way they do. Additionally, and this is important, he is usually well-read.

note: I don't mean to exclude any woman by using he instead of typing he/she every time.

As an unrelated question, I noticed that you trade equities...I do as well with a a prop firm in Baltimore. Send me a PM. We've been getting crushed this month, but CFC short has been working for me nearly every day.

[John Maynard Keynes]

I have his book The General Theory of Employment, Interest, and Money and recommend anyone interested should read it. I've also wanted to read for some time the works written by his main influence, Wicksell.

Anyway, I concur that he was a horrendous economist. I think his problem was that he didn't think systematically enough to base his economic policies on a proper philosophical base. I think the idea of his that has been most widely accepted is that government deficit spending stimulates the economy. This can be seen across the political spectrum, within both parties. However, I disagree with you about him being the most evil intellectual of the 20th century, because we were already moving away from a proper economic policy before Keynes work was accepted, with the creation of the Fed and implementation of income tax.

As for the Treaty of Versailles I am aware that he predicted a number of economic consequences that were to result from the treaty that never occured, so Keynes was definitely wrong in this regard. Also I believe his opposition to the Treaty was unwarranted at the time. But in hindsight, whether or not Germany was treated fairly or unfairly in the Treaty (I believe fairly) isn't crucial for one to understand that the Treaty did, at minimum, contribute to creating a psychological wasteland that a man such as Hitler could exploit. I'm not familiar with what exactly Keynes didn't approve of in the Treaty (or maybe it was everything in the Treaty), as I have not read the work he wrote about it, so I withhold judgement on proclaiming this to be a major evil philosophical fault of his until I am more educated on his criticisms of the Treaty.

Even so, the other works he published give sufficient justification for one to denounce him as wrong.

[The Shah: Is Supporting a Dictatorship Moral?]

From Wikipedia:

"On 28 April 1951, the Majlis named Mossadegh as new prime minister by a vote of 79-12. Aware of Mossadegh's rising popularity and political power, and with the assassination of Prime Minister Ali Razmara in March, the young Shah appointed Mossadegh to the Premiership. Shortly after coming to office, Mossadegh enforced the Oil Nationalization Act, which involved the nationalization of Iran’s oil, cancellation of the AIOC’s oil concession due to expire in 1993 and expropriation of the AIOC's assets.

Despite the economic hardships of his policy, Mossadegh remained popular, and in 1952, was approved by parliament for a second term. Sensing the difficulties of a worsening political and economic climate, he announced that he would ask the Shah to grant him emergency powers. Thus, during the royal approval of his new cabinet, Mossadegh insisted on the constitutional prerogative of the prime minister to name a Minister of War and the Chief of Staff. The Shah refused, and Mossadegh announced his resignation.

Ahmad Qavam (also known as Ghavam os-Saltaneh) was appointed as Iran's new prime minister. On the day of his appointment, he announced his intention to resume negotiations with the British to end the oil dispute. This blatant reversal of Mossadegh's plans sparked a massive public outrage. Protesters of all stripes filled the streets, including communists and radical Muslims led by Ayatollah Kashani. Frightened by the unrest, the Shah dismissed Qavam, and re-appointed Mossadegh, granting him the full control of the military he had previously demanded.

Taking advantage of his popularity, Mossadegh convinced the parliament to grant him increased powers and appointed Ayatollah Kashani as house speaker. Kashani's Islamic scholars, as well as the Tudeh Party, proved to be two of Mossadegh's key political allies, although both relationships were often strained..."

Yeah, the guy was an idiot and his policies were short-sighted. But why should a foreign country (such as ours) tell another country what their policies should be, by installing whatever regime they believe is best? Why not give the guy some time to ruin his country and wait until the philosophic undercurrent is supportive of capitalism?

I'm still looking for how American business was connected with Anglo-Persian Oil.

[The Shah: Is Supporting a Dictatorship Moral?]

American businesses had an interest in Anglo-Persian Oil, which justifies the act on a purely nationalistic basis.

I was not aware of this. I tried searching for it for a bit, but I found no link between American business and Anglo-Persian Oil. Where are you seeing this?

Even if there had been no such interest, there is no question that the US would have been morally justified in undertaking a direct military action, since Mossadeq had no right to govern the country.

Why did he have no right to govern the country if he was democratically elected by his country's own parliament?

[Would you like to bomb Iran?]

Ugh. The entire world is ready for capitalism. Are you suggesting that Iran needs to go through periods of Marxism, Benevolent Socialism, Religious Dictatorship and Fascism in order to be "finally ready" to be free? I don't see why there should be any period of preparation.

I'm suggesting again, as I did in my post above, that capitalism will not be accepted until the culture sheds its philosophic ideas that conflict with the nature of man.

The entire world is not ready for capitalism. This doesn't mean anything about what types of political systems a given country should cycle through, or how long a period of preparation a particular country will need. It means that the ideas which justify capitalism as the only moral political system are not shared by all countries and cultures. There is no set period of time or amount of political systems a country will go through before they find this moral justification. It is more dependent on when the leading intellectuals of a given culture step forward and defend capitalism than on anything else.

I don't see how this applies to the case of Iran -- we did nothing whatsoever to encourage capitalism in Iran. All we did was dispose of the excrement left by the Najlis.

That is precisely my contention. That there is nothing we can do to encourage capitalism in Iran. It is hopeless. The ideas need to be accepted and justified within Iran's culture before they can be converted to political philosophy.

.....Edited to ask DavidOdden: Did you receive my PM?

[Would you like to bomb Iran?]

That's a pretty fundamental repudiation of the concept "natural rights". However, it does explain a lot about your argument. But then surely you must recognise that, as a legal entity, the US has a right to use whatever means required to recover stolen property.

I think that I am not expressing myself well enough for you and DarkWaters to see my point here, because you are assuming I am a libertarian or that I am against Objectivism, neither of which is anywhere close to the case. I am going to try to make it more succinct.

My point is that there are some cultures which believe that the right to own property is not a natural objective right. These cultures are philosophically opposed to the concept of property rights. My statement is that when one does business in such a culture, he cannot expect to have a legal right to his property, whether such property is intellectual or physical in nature. Therefore, there is no legal precedent or protection to prevent a nationalization of property from occuring.

The obviously legitimate statement that the right to own property is a natural right derived from mans nature is a statement that will not apply under the legal system of a country which is philosophically opposed to mans nature.

This is why I say that a company which chooses to do business in such a country, must enter its venture with a great deal of caution and skepticism, while weighing the risk that it may lose the totality of its monetary investment. As it occured in Iran after this happened with BP, the British government stepped in to install a government that was friendly to Western capitalist interests, and thereby prevented nationalization.

But one must understand that the entire world is not ready for capitalism, irregardless of whether capitalism is objectively the only moral political system or not. The philosophical ideas that justify capitalism are completely at odds with the philosophical ideas in a country that does not grant property rights. Therefore, by installing a capitalism-friendly government without a wholesale change in the philosophical ideas of the country, all we are doing is putting a band-aid on a rotting corpse, and in the process irritating other parts of it.

Why not just let the corpse rot?

[The Shah: Is Supporting a Dictatorship Moral?]

Absolutely not proper and completely not moral. Probably the single most ridiculous foreign policy blunder the United States has ever made. There is no argument that can support US involvement. Now, we can most definitely argue whether or not the UK had a right to intercede (even though Britian went to the International Court of Justice at The Hague to contest the nationalization and they were ruled against). The bottom line was that Britian lacked the means to replace the democratically-elected government with a more Western-friendly regime, which would have enabled British Petroleum to continue using Iranian oil fields. Because of this, Britian came to Sec. of State Dulles for help, playing on US fears about communism by trying to link Mossadeq to the Soviet Union. Truman disagreed, but Eisenhower conceeded after becoming president.

Anyway, the simple fact with regards to America is that the United States had no property on Iranian soil that was nationalized.

[Would you like to bomb Iran?]

Oops. Sorry, didn't see your post before I responded to the other one.

Not right by what standard?

Natural rights, including property rights, exist everywhere no matter what cultural norms are, no matter what the established law or religion of a region is and no matter what anyone thinks or feels.

This is an incorrect statement because there are not property rights everywhere. There are no property rights in a numerous amount of countries. That is what we are discussing.

Just because a dictator has a lot of military might to enforce his whims does not mean that his victims do not have rights. The rights of his victims are just tragically not protected.

This is my point. There is no protection of any rights whatsoever. So, if you choose to do business there, you are doing so with the risk that your property can be taken from you and that you will be left with no legal claim on your former possessions.

[Would you like to bomb Iran?]

Why? Are you presuming that rights are only valid in a rights-respecting country, so North Koreans don't have a right to their own life because they live in a dictatorship? Presumably you just made a typing error when you italicized the word "property".

The right to own property is only valid in a country that sanctions the right to own property.

Now, one can choose to invest in property in a country that does not recognize property rights, but he must do so with the full acceptance that his property can and most likely will be taken from him at any given time, by any given person, and for any given reason.

[Would you like to bomb Iran?]

The concept of individual and property rights is still well-defined in totalitarian regimes, it simply isn't respected -- just as crooks in bad neighborhoods don't respect the rights of property owners. That is one of the reasons why it is right to send in police or soldiers to protect rights, in bad neighborhoods or countries.

Not only are individual and property rights not respected in these types of regimes, but they are actually held as concepts that are morally incorrect and invalid. If it was simply a case of disrespecting what is an idea that is seen as just and moral, as is the case of a criminal here in the United States, then it is just and right to send police in to protect either a.) an individual, or b.) an individual's property. However, it is not right to send in soldiers to protect an individual's property in a society that does not sanction or recognize the right of individuals to own property.

[Would you like to bomb Iran?]

That is an equivocation on the concept of rights. Property rights derive from individual rights. To allow them to be violated is not much different. When we start thinking about rights, only in the limited sense as they apply to our persons, we already corrupt the concept and begin the capitulation...

There is no concept of rights in such irrational countries/economies. Even less important is a derivation from the concept of individual rights.

Whether our country should defend against such violations is an interesting debate. You do agree however, that this is an examle of rights violations (not of poor investing) and that had it not be allowed to happen across the globe, we wouldn't be in the mess we're in today with most support of terrorism coming from excess oil revenues.

Or are you trying to minimze the crime committed against these companies?

Absolutely not. I most definitely agree that this is an example of rights violations and a criminal act. And furthermore, I agree that if this had not been allowed to happen, terrorism would indeed have less support from oil revenue. Now, where I differ from you is that I believe that there is no single government, person, or company that could stop the nationalization of oil from happening, without that entity incurring adverse undesirable effects. Understand that the mess we are in today does not come from excess oil revenue. It comes from ideological beliefs and irrational thinking on the part of individuals in charge of countries other than ours. There is no method of imposing the correct ideas on any government or individual. The best one can hope for is that eventually, rationality will prevail and the incorrect party will fix its ideas. Until this happens, there can and will not be any way of dealing rationally with the incorrect party. So, to any company looking to profit in the immediate moment by partnering with such irrational people: Do so at your own risk, and understand that your property, whether intellectual or physical, will not be protected by law.

That same reasoning would say that a store should not open in a high-crime neighborhood and the police should not protect a store-owner in a high-crime area, because that is a "poor investment choice". In fact, men have the right to open businesses and engage in free trade anywhere they want, and that right is not cancelled by the fact that criminals are known to operate in that area.

This example is dissimiliar because in any high-crime neighborhood in the United States, the concepts of individual rights and property rights are still clearly defined and enforced by law. This is not the case in a foreign country which is ideologically opposed to the concept of property rights.

You reminded me of an experience I have had that seems relevant so I am going to share with you...

I used to be a General Manager for a large Domino's Pizza franchise in Washington, D.C. The first store that I managed was in the Southeast neighborhood of D.C, historically known as one of the worst neighborhoods in the country. I was offered a large amount of money to accept this position, with the promise of being promoted to a store downtown near the White House within 2-3 months, a position which would earn upwards of 120k a year. I was 18 years old with not too much too lose I suppose, so I took it. But believe me, every day when I drove into work I accepted the fact that I was putting my life in danger and that there was nobody who would look out for me except for me. All of my drivers carried guns in their cars, and I carried one as well at all times.

Now, I recognized that there was not any semblence of rationality when working in this area. The only thing one can plan for is the immediate moment, with absolutely no concern beyond that. Somebody did break into my store late one night and another night we were robbed.

Now, of course, we are in the United States so we were protected under the law, which makes this differ from an area where you are not granted any right to your own property. But the point is, when working in such an area, it is you who must conform to the way things operate around you. And you will conform quickly, regardless of what you believe is rational. What is rational or proper does not matter. You cannot deal with irrational people by using rationality and you will not be able to change the way that an irrational being thinks. Before you begin your business venture in such an area, you must accept these facts and weigh them as risks.

My problem with a government interceding on behalf of a company which has its property rights violated in a country that doesn't respect property rights, is that the solution will be a quick fix and will also have adverse effects on the interceding government. This is because there is no way to deal with the real problem, which lies beyond the realm of economics or politics, and in the realm of ideas.

[Would you like to bomb Iran?]

The question of to what extent the United States should guarantee the safety of its citizens overseas is complicated, particularly because we live in a mixed economy.

For me, the issue is complicated since defense is funded through mandatory taxation. Thus, if any U.S. citizen wishes to pursue a perilous venture overseas, he would be doing so at taxpayer risk if the U.S. is to defend him. Given a quasi-Capitalist states whose defense is still funded through mandatory taxation and given that this country lives in a world with many other states whose governments may not effectively secure individual rights, there would most likely be a list of foreign countries where the quasi-Capitalist government will guarantee your freedoms and ones where it will not. Needless to say, to determine which nations are in the former category and which are in the latter would be non-trivial.

That being said, I think it is very dangerous to allow crimes against U.S. citizens who are outside of U.S. territory to be committed with impunity. Individuals have natural rights regardless of their geographic location.

Sure, secure individual rights. For example, the taking of an American hostage overseas, or a similiar life-threatening event that would be internationally condemned would present a valid case for a government acting on behalf of the citizen. However, a company that is operating in a country and then is nationalized? Give me a break. There is no reason why the government should act on behalf of a company on the basis that the company's property rights were violated on foreign soil. The company made a poor investment choice.

Sure, and I'll second Darkwaters' response about protecting property rights overseas. But the point is that there was that the USA was acting within its rights to do so - and you cannot say that Iran is absolved of any of the responsibility for murdering our citizens. Thus, the response to said murder is not effected by any consideration of the propriety of acting to defend property rights. As I said above, it is a separate and unrelated question to the question of what we ought to do to retaliate.

And I submit to you that when British Petroleum (the company operating in Iran) was nationalized, there should have been no retaliation on the part of the British government. I'm sure we could spar over this point, but that isn't even the crucial point. Let's assume that a country is justified in protecting its own industries property rights in a foreign country. Understand that there was no United States company in Iran which had its property rights violated; it was a British company. The fact is that the British invited the US to participate and the US did, and this is absolutely ridiculous. Operation Ajax, as it was called, was a disgraceful foreign policy mistake on the part of the United States. Truman saw this, but when Eisenhower took office the British again invited us to participate and Eisenhower conceeded.

[Would you like to bomb Iran?]

I'm much more fearful of a car accident, my wife getting raped, or an armed robbery than of Iran.

We don't understand the irrationality of countries with cultures and political beliefs different than ours and they don't understand us. Somebody said we installed the shah in Iran because our property rights were violated with regard to our oil interests. This is correct. However, if the culture of a country does not accept the concept of property rights, then one does business in that country at his or her own risk. The loss of oil output due to nationalization should simply be written off as an expense related to doing business in an irrational economy. Essentially, the company took a chance, made an investment and lost. The company or government involved should accept this loss and move on. Lesson learned should be that when doing business in irrational cultures with irrational men in charge, you will never be able to think or plan beyond the moment.

[Federal Student Loans]

So how, then, will programs like this go away if people like me (and Rand, apparently) cannot say that it is unethical to benefit from them? If the program never existed in the first place, I have no doubt that there would be more free-market lenders out there who would compete to such a degree that one probably could receive approximately the same rates and terms that one presently gets from Federal loans. Had I had the choice, I would have certainly taken a competitive private loan anyday over one that comes out the taxpayers' pockets ( and I did do just that when I needed to take out additional loans for my Montessori certification). But the federal program is there, and because it is there the variety of private lenders that could be available simply are not. Yes, I did "use" someone else's (and my own eventual) tax dollars for my own benefit but unlike welfare or other such programs, there was a productive, educational purpose involved. I used that money to educate myself in order to become a more productive member of society; not to sit on my butt and live off of other people's effort. My effort earns my paychecks now, and my taxes have paid back those loans already and then some. I make my payments on time and look forward to the day when I no longer have that little bit of government on my back. In the end, between what I now pay in taxes as a single, young, educated member of society, plus the formal payments, they'll get back what they (or, you an I, the taxpayers) lent me more than 5x over. It's probably the only government program that actually earns a profit! They will get "their" money back and then some, but you will get the educated anti-big government teacher that they do not yet realize they helped to create. Ha!

Thank you for the reply. Very good information.

Although I don't accept the fact you had no choice. You could have taken a private loan with a more unfavorable rate.

But you never answered the question that you started this paragraph with. If people don't say that it is unethical to benefit from them, the vicious circle will never end. Now, I understand one person won't make a difference by not taking a loan. But if that one person goes on to become a groundbreaking politician who advocates the demise of the federal loan program, and the overall philosophy of the country had changed a bit, then he actually would make a difference and his decision would be seen in hindsight by the public to be one of exceptional moral character.

I believe I don't agree with Rand in this instance but I'm still not decided on this one yet....

[Insider Trading]

*** Mod's note: From another thread. Merged with this one. - sN ***

I think Yaron's case was even more fundamental than this. That a market as such is actually "made" by people trading on the information they have. That the pricing that results, results from the action of people trading on their information or hypothesis. So the idea that one could bar people in the know from trading and that the "market" somehow still has a relation to actual values is highly suspect. Ignorant people can't make a market in anything. One cannot protect ignorants by barring those "in the know" from trading in the market because it is those in the know that "make" a market.

I agree with you here. I haven't seen what Brook has written on this topic. What would be propose to do with a CEO who trades on inside information not yet released to the public? For example, a CEO may know that his company's most recent quarter is a wash and will adversly affect the value of his stock. He may decide to sell out his holdings of the stock before the information is made public. I assume Brook holds that this sale is in effect making the market for the stock. However, a very few amount of the CEO's hundreds of millions of shareholders will know that the order to sell a million shares (or whatever amount the CEO holds) was the order ticket of the CEO. As far as shareholders know, it could be any large holder selling. How would the shareholder know to pay more attention to this particular large sale than any other large sale?

[Is speculative trading productive?]

I am actually a day trader. I work with the proprietary trading firm Assent, LLC and like you, sit in front of a computer for a good amount of time. I have had the same thoughts you are presenting in this thread, especially when I first began. Now, I consider myself like most other traders who realize that this buying and selling daily, weekly, or even monthly thing doesn't make much sense. A company misses earnings estimates for a quarter and so therefore the market decides that the valuation of the company needs to be cut by 10-15%? An analyst at Goldman Sachs upgrades a company's stock and the value of the company goes up 5%? The reasons that the market moves are often silly, and moves up and down are always exaggerated. Most traders understand Benjamin Graham and Warren Buffet value investing and why it makes sense. However, the fact is, the markets are constantly exposed to the emotions of all its participants and this creates wide swings in valuations. A trader simply takes advantage of this fact.

A trader like you or myself simply adds liquidity to the markets, like John McVey said. Before the advent of electronic trading, specialists and market makers actually stood ready to buy or sell any security at any given time, making the markets extremly liquid. There were specialist firms who instructed their employees to make markets on Black Monday in 1987 while the market was crashing 23%. Without these buyers, who would the sellers have to sell to? Everyone else was scared straight to buy anything. Traders basically provide a similiar service.

If stocktrading is unethical because you are merely benefitting from a rise or fall in asset prices, then it follows that investing money in a start-up business as an angel investor or venture capitalist must also be unethical. Similiary, selling your house for a profit would also be benefitting from a rise in an asset price, and therefore would be unethical.

Moreover, it is not necessarily a zero-sum game. This is a popular phrase to express the fact that for every transaction there is a buyer and a seller. However, the S&P or Dow can easily be positive or negative on any given day, thereby adding or subtracting an equivalant total value from company valuations, and therefore, shareholders or market participants.

[Federal Student Loans]

It is not self-sacrificial to live without governmentally-paid scholarships, but it is to reject them solely on the grounds that they derive from tax money. On the third hand, if you actually know that restitution has already been made, then perhaps a principled rejection of government scholarships is not self-sacrificial, but it's hard to do that level of detailed accounting, in my opinion.

Thanks for the responses. I went and read this article you were talking about. However, I don't see how it is self-sacrifice to reject them on the grounds that they derive from tax money and one is philosophically opposed to them. Could you elucidate on this a bit more?

The problem doesn't exist simply because some people are using tax money to go to school; the problem arises because in general, people hold that it's okay for the government to tax, in order to spread the wealth around so that everybody can get their needs and wants taken care of. One person declining to take a scholarship will not have an effect on that big-picture problem. A wholesale change in philosophy is necessary.

You're right about this and I totally agree with you. One person declining a loan will have no effect. Sorry I expressed myself poorly. My line of thinking is that if students continually use federally provided loans, people will continue to accept them as "necessary" for higher education. I understand that a wholesale change in philosophy is needed, but I am still having trouble with this issue.

If, for example, a politician believes in the abolishment of the DOE and advocates privately provided loans yet it can be shown that he or his kids have been educated using some sort of subsidized loan, would that not present a problem? How could he introduce legislation favoring abolishment? His opponents and the public would never accept his arguments. It seems that for these unjust programs to end we need a wholesale change in philosophy and somebody advocating ideas that he or she has actually accepted and practiced in his or her own life.

[Federal Student Loans]

Do you think it is proper for one to receive a federal student loan?

At one point I remember reading that Rand said something like: "If the program is already there, use it." She was not speaking of student loans, but some other type of government welfare I believe. I think I may have seen this in one of her Q&A's after a lecture. It seems to me that taking a federal loan encourages their use and sanctions the existence of the Department of Education.

I do realize that the the money being used to sponsor these programs is taxpayer money and that one will probably pay more in taxes than one takes in benefits over the course of his/her life. However, if everyone thought like that and took advantage of federally subsidized student loans, how would this problem ever be corrected? Morever, how would one be able to argue for the abolition of the DOE if it can be shown that he/she had benefited from its existence?

[Ron Paul]

Ron Paul has his downfalls. However, anyone who wants to truly understand some of his positions and what he believes should read the following statement written by him in the year 2000:

A Republic, If You Can Keep It

Web address here:

http://www.house.gov/paul/congrec/congrec2000/cr020200.htm