July2001

BANKNOTESisaquarterlynewsletterpublishedbyInfiniteBankingConcepts R.NelsonNash,Editor rnnash@mindspring.com

WELCOMEtomembershipintheInfiniteBankingConceptthinktanktoJayCulotta ofMetarie,LA.JayrecentlyattendedatwodayIBCSeminarinMetarieandsays,Iwill do whatever I have to do to thoroughly learn your system because it is the ultimatewinwinsituation.HeisamemberofTheProducersGroup,Inc.And thanks to Gene Lemoine for taking the initiative in putting the seminar participantstogether. ANOTHERCOMMENT: ItrulyenjoyedyourseminarthispastweekinNew Orleans. Yourmethodsaresoeasytounderstand,andsoinspiring,wecould notwaittosharetheprocesswithourclientsandprospects,aswellasjumpin headfirstforourselves! Ireallyappreciateyourknowledgeandinsighttowhat canbepossibleinthefuture. _____KayRegimbal,Metarie,LA Later on that week I did the same seminar in Nashville, TN where Tony Walker was responsible for getting a great group of agents together. There were 24 participants somecomingfromratherdistantcities. TrentFortnerhostedtheevent.Thankstoall foryourhelp.

Hereareacoupleofemailmessagesabouttheeffectsofthebook, BECOMINGYOUR OWNBANKER: Thankyouonceagain.Igaveyourbookto2businessownersthatIhavebeenworking with.Afterathoroughreading,bothcalledmebacktotellmethatthegrocerystorestory willbecomepartoftheiremployeetrainingtoshowhowthebusinessworldreallyworks, oh, and by the way, they both doubled their premium that they are putting into their programs.Seemsequipmentacquisitionfinallysunkin. Sincerely, MikeSchubach _____________________________ LASTSEPTEMBERORTHEREABOUTSIHADLUNCHWITHMYCPAANDHIS WIFEWHOAREGOODFRIENDS. IGAVEHIMACOPYOFYOURBOOKAND TOLDHIM,PLEASEGIVEMEYOUROPINIONOFTHISBOOK. ITISEASYTO READANDITISONLY84PAGES. 46WEEKSLATERWHENWEWERETALKINGONTHEPHONEABOUTSOME OTHERMATTER,ICASUALLYASKED:"HAVEYOUREADTHEBOOK 'BECOMINGYOUROWNBANKER'YET?" HESAID:"NO"

"READIT!"ICOMMANDED. TWOMONTHSLATERHECALLEDEXCITED:"IHAVEREADTHEBOOK TWICEANDIWANTTOBUYSOMEWHOLELIFE". HEBOUGHT$1,000PERMONTHPREMIUM. ERLANDREUTER (OnemustunderstandthatErlandisaMarine Iusedtorefertopeoplelikehimasa RetiredMarineoranExMarinebutIwashastilycorrectedbyoneofthemthat thereisnosuchthing onceyouareaMarine,youarealwaysaMarine!Nowyou knowwhyErlandcommandedtheCPAtoreadthebook).

July6,TaxFreedomDay! Hallelujah!Wefinallymadeitthebalanceofthe
yearwecanworkforourselves! SomethoughtscometomindasIcontemplatethissituation.OnSundaybeforeJuly th 4 themenschorusofourchurchchoir(Ihavehadtheprivilegeofparticipatingin singing since high school) performed Randall Thompsons Testament of Freedom. The words were written by Thomas Jefferson shortly before the secession of the ColoniesfromEngland.Carefullyreadthesewordswrittenin1774fromPartIIof thepiece: We have counted the cost of this contest, and find nothing so dreadful as voluntaryslavery.Honor,justice,andhumanityforbidustamelytosurrender that freedom which we received from our gallant ancestors, and which our innocent posterity have a right to receive from us. We cannot endure the infamyandguiltofresigninggenerationstothatwretchednesswhichinevitably awaitsthemifwebaselyentailhereditarybondageuponthem. Ourcauseisjust.Ourunionisperfect.Ourinternalresourcesaregreat. WegratefullyacknowledgeassignalinstancesoftheDivinefavortowardsus, thatHisProvidencewouldnotpermitustobecalledintothisseverecontroversy untilweweregrownuptoourpresentstrength,hadbeenpreviouslyexercised inwarlikeoperation,andpossessedofthemeansofdefendingourselves.With heartsfortifiedwiththeseanimatingreflections,wemostsolemnly,beforeGod andtheworld,declarethat,exertingtheutmostenergyofthosepowerswhich our beneficent Creator hath graciously bestowed upon us, the arms we have beencompelledbyourenemiestoassumewewill,indefianceofeveryhazard, withunabatingfirmnessandperseverance,employforthepreservationofour libertiesbeingwithonemindresolvedtodiefreemenratherthantoliveslaves. Ourforefatherswenttowarbecauseoftaxes! Andnowreadthefollowingpieceby Gary North to see the level of taxation that Jefferson considered slavery and provokedthiswarofsecession. _______________________

IndependenceDayCelebrationForANewMillennium ByGaryNorth Technically, this is the first American Independence Day celebration for the new millennium. Itsagooddaytothinkbackontheworldwehavelost.Wewerehandedagreat legacyby56bravemenwhoputtheirlivesonthelinewhentheyputtheirnameson the paper. The Declaration of Independence was passed by the Continental Congress on July 2, but signed on July 4. They prudently kept their signatures secretforseveralmonths.
Theissuewasnotmerelymoneyitwasamatterofsovereignty.Theminorityofcolonists who followed Sam Adams and Patrick Henry were convinced that Parliament did not lawfullypossesssovereigntyinAmerica,whichEnglishconstitutionaltheoryThesplitwith

England had been developing for over a decade. It became a reality in Massachusetts in the spring of 1775, with the famous ride of Paul Revere and the assemblingofwhatbecameknowninretrospectastheminutemen.Britishtroops werecomingtoconfiscatethegunsandammunitionofthelocalmilitia.Themilitia had other ideas. These ideas later resulted in the Second Amendment of the Constitution. The war had begun over a dispute about taxation. The colonists wanted to have controlovertaxationthroughtheirlegislaturesandlocalassemblies.Theydidnot wanttosubmittoEnglandstaxationfromLondon.Theyalsowereunhappywith theEmpiresrestrictionsontrade.JohnHancockwasasmuggler,notaninsurance salesman. NotmanyAmericansknowwhattheleveloftaxationwasin1775.Ididagraduate schoolpaperonthistopicover30yearsago.Englishtaxeswereintherangeof1% ofincomeinmostcolonies,andpossiblyashighas2.5%intheplantationcolonies. Forthis,theywenttowar.
asserted.ThesemenwerebreakingwiththeideaoftheBritishempire.

There was a religious issue, too: the threat of the Church of Englands sending a bishop to the colonies. A bishop had to ordain priests. The bishop who possessed thisauthorityovercolonialchurcheswasthebishopofLondon.Ittookalongand expensive trip to London for a man to be ordained. Congregationalists, Baptists, and Presbyterians preferred it this way not to mention Marylands Catholics. TheyregardedtheChurchofEnglandcorrectlyasanextensionofBritishrulein America. The king was the head of the church. (See the 1962 book by Carl Bridenbaugh,MiltreandSceptre.) Thewarwasfoughtoversovereignty:taxation,religion,andtheproperdistribution ofpowerswithincivilgovernment.ThecolonistswhowenttowarwithEnglanddid not trust central government. They regarded the lawful authority of civil

government as one government among many, sharing authority with self government, family government, and church government. They regarded with hostilityParliamentsclaimoftotal sovereigntyovertheaffairsofBritishcitizens. Today,mostAmericansregardsuchtheoreticalandtheologicalissuesasquaint,or curious, or nave. The central government does not officially claim the absolute sovereigntythatBritishlegaltheoryclaimedforParliamentin1776,butinfactthe invasionofourlibertiesisfarworsethananythingconceivedbythemosttraditional ofTorypoliticaltheoristsin1776. A slogan in the era of the American Revolution was No taxation without representation. Today, we have representation, and our taxes reflect a level of confiscationthatwouldhavebeenregardedastyrannicalbycitizensofeverynation in1776. In ancient Israel, when the people came to the prophet Samuel to request that he ordainaking,hewarnedthemagainstthis And he will take the tenth of your seed, and ofyour vineyards, an give to his officers, and to his servants. And he will take your menservants, and your maidservants,andyourgoodliestyoungmen,andyourasses,andputthemto hiswork.Hewilltakethetenthofyoursheep:andyeshallbehisservants(1 Samuel8:1517). The Hebrews had been enslaved in Egypt. Their deliverance by God had establishedthemasanation.UnderJoseph,GodhadplacedEgyptintoaformof bondage.ThePharaohhadcollectedgrainastaxesforsevenyears,storingitfora coming famine. Then the central government sold it back to the people when the faminehit.Bythesecondyear,theywerereadytoselltheirlandtoPharaoh. Wherefore shallwediebeforethineeyes,bothweandourland?Buyusand our land for bread, and we and our land will be servants unto Pharaoh: and giveusseed,thatwemaylive,andnotdie,thatthelandbenotdesolate.And Joseph bought all the land of Egypt for Pharaoh for the Egyptians sold everymanhisfield,becausethefamineprevailedoverthem:sothelandbecame Pharaohs(Genesis47:1920). ThentheyacceptedforcedrelocationintothecitiesofEgypt(v.21).onlytheland ofthepriestsboughthenotforthepriestshadaportionassignedthemofPharaoh, anddideattheirportionwhichPharaohgave them:whereforetheysoldnottheir lands(v.22). ThenJosephsaiduntothepeople,BeholdIhaveboughtyouthisdayandyour land for Pharaoh: lo, here is seed for you, andye shall sow the land. And it shallcometopassintheincrease,thatyeshallgivethefifthpartuntoPharaoh, andfourpartsshallbeyourown,forseedofthefield,andforyourfood,and forthemofyourhouseholds,andforfoodforyourlittleones.Andtheysaid,

Thouhastsavedourlives:letusfindgraceinthesightofmylord,andwewill bePharaohsservants(vv.2325). Egypt was the most bureaucratic tyranny in the ancient world. But for todays residentsoftheWesterndemocraciestoreturntotheleveloftaxtyrannyofEgypt, itwouldrequiretaxcutsofatleast50%.Toreturntotheauthoritarianruleofthe Hebrewkings,itwouldtakeataxcutof75%. Acenturyago,noWesternnationhadaleveloftaxationgreaterthantheburdenof theHebrewsunderthekings. What the west has surrendered to the central government since World War I has beenitsliberty.Wearenotfreemenbytheprevailingstandardsof1913. Americans like to think of themselves as a free people. We occasionally even sing thephrase,landofthefreeandthehomeof thebrave. Butwesingitever less frequently.IhavenotbeentoapatrioticFourthofJulyparadeasanadult.Ihave neverheardasingleFourthofJulypoliticalspeech.FewAmericansunderage55 have. Weshootoffafewfirecrackers.Wedriveto somelocationandwatchanhourof taxfundedfireworks.ButthatsaboutallthatremainsoftheFourthofJuly. HowmanyAmericanshaveeverreadalloftheDeclarationofIndependence?Not many.Fewstudentsinhighschooleverspendasmuchasoneclassperiodstudying itsaccusationsagainsttheking. TheyDontKnowtheDifference My first fulltime job was with the Foundation for Economic Education (FEE), in IrvingtononHudson, New York. Its founder, Leonard E. Read, used to give a speechinwhichhesurveyedthehistoryofAmericantaxation.Heshowedhowthe rates had grown higher until the state was extracting 40% or more of our wealth. Step by step, American voters had adapted the politics of plunder. Read then concluded:Theydontknowthedifferencebetweenfreedomandslavery. Hewasright.Mostpeopledontknowthedifference.Thenumberoffreesocieties is declining today. Communism was a terrible evil, but the governments that replacedCommunistrulearenotfreesocietiesby1913standards. Thereiscomparativefreedom,ofcourse,justastherearecomparativelystrongfiat currencies compared to each other today. But World War I destroyed the international gold standard, the free movement of individuals (there were no mandatorypassportsintheWestin1913),andsingledigittaxation. The voters do not know the difference. They think there was an eleventh commandment:Thoushaltnotsteal,exceptbymajorityvote.Theyhaveadopted

thepoliticsofplunder,bestdescribedbyFredericBastiatacenturyandahalfago inhisgreatlittlebook,TheLaw. Hepresentsthreechoices: 1. 2. 3. Thefewplunderthemany. Everybodyplunderseverybody. Nobodyplundersanybody.

We are clearly living under system two. To regain our freedom to return to system three will take more than a declaration of independence. It will take a revolutioninourthinkingasAmericans. I can think of no better booklet to read on Independence Day than Bastiats The Law. WhenBritishtaxationin1776lookslikeautopianrestorationofliberty,wehavea lotofeducationalworkaheadofus. ___________________________ GaryNorthistheauthorofanelevenvolumeseries,AnEconomicCommentaryonthe Bible. ThelatestvolumeisCooperationandDominion:AnEconomicCommentary onRomans. Theseriescanbedownloadedfreeofchargeatwww.freebooks.com.

ATRAFFICJAMiswhathappenswhencarsproducedbytheprivatesectormeetroads providedbythegovernmentsector..Thesupplyofroadsisdeterminednotbyconsumer demand,butbypoliticiansandbureaucrats.Thesepeoplearenotguidedbyadesireto servetheirfellowman,butbyadesiretomaintainandincreasetheirpoweroverother people. ~LewRockwell Thereisallthedifferenceintheworldbetweentreatingpeopleequallyandattemptingto makethemequal. ~F.A.Hayek Themarvelofallhistoryisthepatiencewithwhichmenandwomensubmittoburdens unnecessarilylaiduponthembytheirgovernments. ~WilliamH.Borah LEASINGratherthanfinancingorpayingcashhasbecomeapopularmethodof acquiringanewcarortruck.JerryDuffy,presidentoftheNationalVehicleLeasing Association,toldCarPoint,"Weanalyzedanumberofdifferentresearchsourcesand foundthatin1999,34to38percentofvehiclesalestoconsumerswerepaidforwith leasefinancing."

WHENWISHESBECOMERIGHTSbyLeonardE.Read Federal deficits mount as the consequences of increasing claims against welfare programsofallkinds.Thisgrowthofgovernmentspendingandinterventionin1983leas metoreviewandrepeatsomeideasIofferedonthesubjectin TheFreemanofNovember 1964. Reflect on the backward countries in the world the distressed areas in the U.S.A. themanyindividualswhoarepovertystricken,lame,blind.Thenaddalltheunfulfilled desiresand yearningsofthe235 million Americans,ranging from betterfood,housing, clothing, medicine, hospitals, mink coats, and automobiles to colonizing outer space. Whatafieldforthewouldbephilanthropistifallthesewantswerewithinhispowerto fulfill. Letusimaginethatyouhavebeenofferedamagicpowertosatisfyeveryonesmaterial wisheswithnoeffortonyourpart.Suppose,forinstance,thatyouhadAladdinslamp and could call up a genie that would confer any goodor service on anyone you might choosetohelp.Ifyoucouldthussatisfydesiresformaterialthingswithneithercostnor effort on the part of anyone, would you be willing to assume the role of Aladdin and bestowbenefactionslikemannafromheaven? PerhapsyouareamongtheveryfewwhoseanswerwouldbeanemphaticNo!There are those few who would immediately sense the consequences of such reckless humanitarianism: no more farming the closing of factories and stores trains and planes coming to a stop students no longer studying a heaven on earth a veritable ShangriLaNomoreproblemsallobstaclesovercomeformankind!Thesefewknow thatwhenthereisnoexerciseandflexingofthefaculties,atrophyfollowsasamatterof course and our species disappears all because everyone is granted riches for nothing morethatthewishing! If this sort of magic were only half practiced, would the result still be bad? Yes! answeredBenjaminFranklin.IfmancouldhaveHalfhisWishes,hewoulddoublehis Troubles. We may infer from this that if a mans objectives could be achieved for nothing more than wishes, no good would be served, deterioration would ensue. Struggle, earning ones spurs, conscious effort, calling on ones potentialities and bringing them into use are essential to survival to say nothing of progress. This is crystalcleartoafew.Butnottothemany! A majority of Americans, today, would acceptthe magic lamp. For it is obvious that mostpersonswhowouldgratifyawish attheexpenseofotherswouldmorereadilydoso at no expense to others. Such wishers are among us by the millions, all in pursuit of somethingfornothingeffortlesswishgratification. These many Americans have found their magic lamp in the Federal political apparatus, and what a genie! Aladdins lamp evoked a genie of supernatural powers but this modern genie is a composite of quite ordinary human beings and, as a consequence, it

relies on the earthly ways of humans. Even so, we must never sell it short it is unbelievablyclever. Aladdins genie performed only on call it responded to wishes when requested. This modernAmericanversion,ontheotherhand,displayszealousinitiativeinthatit: 1. inventswishesforpeople. 2. persuades people that these wishes are their own and, then, actively solicits theirgratification. 3. convincespeoplethatthesewisherareamongtheirnaturalrights,and 4. castsitselfintheroleofhelper. Mythologyinitsheydaynevercameupwithagenieequaltothis. Golden goals for people to adopt? It was this genie, not the people of the Tennessee Valley,thatinitiatedTVAwithitsbelowcostpricing.Itwasthisgeniethatconceived socialsecurity,thePeaceCorps,andsoon. Further,thegenieinsinuatesitsgoldengoalsintothemindsofpeopleaswishescapable offulfillment.Thegenieappearsinnearlyeverycommunityofthenationandinmany countries of the world selling its wishing wares. Federal urban renewal projects are promoted far more by the bureaucracy in Washington than by local citizens. Federal largessisurgeduponthecitizenry. Ofcourse,thereasonisclearenough:urbanrenewal isanintegralpartofthenumerousFederalfullemploymentprojectsrequiredascover upsoftheunemploymentcausedbyotherFederalpolicies. Butitwouldhardlydoforthisgenietogratifywishesweretheperformanceattendedby anysenseofguiltonthepeoplespart.So,howdoesthegeniedisposeofthis hazard? Simple! It transmutes wishes into rights, and remains above suspicion in this legerdemain. Do you wish a restoration of your decaying downtown? Very well that wishisaright.Doyouwishlowerratesforpowerandlight?Presto!Thewishisaright. Doyouwishabetterpriceforyourtobacco,abetterjob,abettereducationthancanbe hadbyyourowneffortsinwillingexchange?Thesewishesarenowyourrights. Labor unions with their righttoajob concept and businessmen with their righttoa market idea (outlawing competition) are dealing in the same category of false rights. Indeed,thiscanbesaidforallofsocialism withoutexception. When people say they have a rightto a job orto lower power and light ratesorto an educationortoadecentstandardofliving,theyarestakingoutaclaimtothefruitsofthe laborofothers.Wherereststhesanctionforthisclaim?Itsimplycomesfromthenotion thatawishisaright. The absurdity of this wishisaright sanction comes clear if we reduce the problem to manageableproportions:ayouandmesituation.DoIhaveajustorrationalormoralor ethicalclaimtouseyourincometoprovidealivingwageforme?DoIhaveavalid

claim to use your income to erect my school and staff it with teacher, or finance my churchandsupplyclergymen? Mostpeoplevictimizedbythemagictransmutationofwishesintorightswill,inthisyou andmesituation,answertheabovequestioninthenegative.Whatescapesthemisthat the problem is not altered one whit by adding one person or a hundred or a million of them.And,ifitbecontendedthatnumbersdomatter,then,praytell,whatisthemagic number? A majority? Mustwenotinfer fromthis majoritarianclichthe indefensible propositionthatmightmakesright? In any community in the land may be found people pointing with pride to some necessitythelocalcitizenscouldnotorwouldnotfinance,explainingthatitwasmade possiblewiththehelpoftheFederalgovernment. The modern American genie, lacking supernatural powers, cannot bring down manna fromheaven.Beingearthly,itsmannaisearthlyinorigin. Havingnothingwhatsoever ofitsown,itsgiftsmust,perforce,stemfromwhatistakenbycoercionfromothers.It cannotbeotherwise. The questions posed are: Do these gifts qualify as help? Is this genie, in fact, a helper? Arethe beneficiariesreally helped?Ifwecan answerthesequestions inthe negative,wecomeoutfromunderthegeniesspell. Helpisasocialterm.Atleasttwopersonsthehelperandthehelpedareimplicitinits meaning.Therecannotbeonewithouttheother.Theextenttowhichone is helped is measured precisely by the nature and amount of the helpers contribution. What is receivedbytheoneiswhatcomesfromtheother. Propertytakenwithoutconsentiscorrectlybrandedasillgotten.Ifpassedontoanother, the other receives illgotten property. Nothing is altered by the transfer. According to moral law, as well as the law of the land, on who takes property without the owners consentcommitsacrime.Whensuchpropertyispassedontoandacceptedbyanother, theotherisadjudgedanaccomplicetothecrime. Property taken without consent cannot be given, for to give is conditioned on and presupposes ownership by the giver. I cannot give that which is not mine. Thus, the genieslargessecannotqualifyasgiftsbutonlyasloot. Lootisnothelp,onewholootsisnotahelper,andonewhoacceptsthelootisnotreally helped. Powertotamperwiththevolitionalfacultiesofothersis,infact,adangerouspossession. Nordoesitmatterwhetherthispowerbeusedtorestrainthesefaculties,asinprivateor politicaldictatorship,orexertedtorelievetheneedfortheexerciseofthesefaculties,as inprivateorpoliticalwelfarism.Howeverstrongthecompulsioninmostofustomodify orimprovethelotofotherpeople,ifwewouldavoidcausingmoreharmthangood,we

mustconfineourselvestothoseaidsthatstimulatetherenewedexerciseofthevolitional faculties in others. This suggests a rejection of all power to impose, leaving instead a relianceuponingatheringordrawingpowerthatmagnetic,attracting,emulatingforce, thepowerthatderivesfromsuchselfperfectionasonemayachieve. I must not, in picking to pieces the notion that wishes become rights, leave the impression that wishes, of and by themselves, are proper objects of scorn. On the contrary, wishes, hopes, aspirations are among the most important forces motivating human progress, evolution, emergence. At issue here is only the means of their gratification. We who reject illusory schemes are not denying the good life to others but merely pointingoutthatthesepoliticalnostrumscanleadonlytodesolatorydeadends.Nogood endcanbereachedbychoosingawrongway. Asweuncovermoreandmorewrongways,therightwaybeginstotakeform.Itisthe greatestgratifierof humanwishesevercomeupon whenallowedtooperate.Itisas morally sound as the Golden Rule. It is the way of willing exchange, of common consent,of selfresponsibility, of open opportunity. It respects the right of each tothe productofhisownlabor.Itlimitsthepoliceforcetokeepingthepeace.Itisthewayof the free market, private property, limited government. On its banner is emblazoned IndividualLiberty. _________________________ PleasegobacktothefirstparagraphandnoticethatLeonardReadfirstwroteaboutthis is 1964 and was lamenting the growth of this phenomenon when he wrote this piece. Now,thinkofhowmuchithasgrownsince1983.Thereisnowaythatthiscancontinue. ThiswritingwasfromtheMay1983issueofNotesfromFEE. Thatwasthemonththe Leonarddiedandisprobablythelastpublishedarticlethatheeverwrote.Thisfactkind ofgivesitspecialmeaningtome. GODGRANTME thesenilitytoforgetthepeopleIneverliked,Thegoodfortune torememberthoseIdo, andtheeyesighttotellthedifference. ____________________________ VISIONEffortandcouragearenotenoughwithoutpurposeanddirection.

IntendedConsequences byWilliamAnderson AsCongressandthepunditscontinuetodebatethesocalled Patients'BillofRights,itbecomesclearthatmuchofthediscussion reflectsbothcynicismandnaivet. Conservativeswhoopposethe billonbothmattersofprincipleandpracticalitysaythatitwill invokethe"lawofunintendedconsequences,"inthatitwillopenthe doorsforhealthinsurancecompaniestofacemassivelawsuits, whicharenowprohibitedbyfederallaw. Thoselawsuits,they contend,willonlydriveupmedicalcosts,makingitevenmore difficultforAmericanstoreceivedecenthealthcare. (Callingasystemthatwillenrichtriallawyersa"BillofRights" doesviolencetoanyhistoricalsenseofwhatrightsmean,andespeciallytothemeaning oftheBillofRightsintheU.S.Constitution. However,thatissomethingtobearguedin adifferentpaper.) Awayofrephrasingtheirargumentistodeclare"everyonewantsqualityhealthcarefor allAmericans"orsomethinglikethat,buttheconsequencesofthislatestbill, unfortunately,wouldsimplytransferwealthtoattorneys,an"unintended"result. Onthe otherhand,thesupportersofthislatestmonstrosityfromCongressdeclarethattheonly waytoforceinsurerstogive"proper"careisto"hitthemwhereithurts,"intheirwallets. Inflamedjurors,theybelieve,uponhearinghorrorstoriesofpeoplebeingdeniedcarebya healthmaintenanceorganization(HMO)"beancounter"willawardhugejudgmentsto sympatheticplaintiffs,thuscreatingnegativebuteffectiveincentivesforHMOsto takebettercareoftheirclients. ThestandardconservativeargumentsagainstthislatestbillwhichtheDemocratshave passedandwhichPresidentBushhasthreatenedtovetoarethat,whilethisisabadbill, thosewhosupportithavegoodintentionsandarejusttryingtoensurethatpeoplereceive goodandfairhealthcoverage. Furthermore,conservativesseemtobelievethatifthey presentlogicalargumentsagainstthisbill,thenperhapspublicopinionwillcometotheir sideandCongresswillthenpasssomethingthatismore"fairandequitable." Unfortunately,theconservativecriticsaresimplywrong. Thereisno"lawofunintended consequences"here,onlyintendedconsequences. WhileTomDaschleandhiscolleagues intheSenate,bothDemocratandRepublican,whosupportthisbillstateonlythattheyare tryingtobring"fairness"tothesystem,thisisnothingmorethananakedattempttoend privatemedicalcareaswehaveknownitandtosubstituteaCanadianstylesystemof governmentrunmedicine. Thistakesplace,ofcourse,onlyafteramajorDemocratic Partyconstituencythetriallawyershavebeenmadeevenwealthierthantheyarenow. Whatweneedtorememberisasimplelessoninmodernpoliticalhistory. Democratslost

controloftheU.S.SenatetoRepublicansinthe1994electionsontheheelsofthemassive failureof"Hillarycare,"whichwasnothingmorethananattemptbythegovernmentto nationalizehealthcare. WhatespeciallygalledtheDemocraticsupportersofgovernment medicinewerethe"HarryandLouise"advertisementsthattheinsurancecompaniesran afterdetailsoftheplancametricklingoutofHillaryClinton'ssecretcommittees. Theseadswerehardlyradical,buttheydidpointoutjusthowcostlytheproposalswould be,nottomentionthatthenewruleswouldhavemadeprivatepaymentformedical servicesacriminaloffensepunishablebyprisonterms,whichisthesituationthat currentlyexistsinCanada. Followingtheelectiondebacle,Democratsrightlyorwrongly blamed"HarryandLouise,"andnowtheyhavetheiropportunityforrevenge. Aswehaveseenwiththefiascooverasbestosinwhicheightpreviouslyhealthy companieshavedeclaredbankruptcyinthelasteighteenmonthsastheblizzardoflegal claimsmountsagainstthemitwouldnottakemuchtodrivemanyoftheHMOsintothe samecondition. Despitetheirsize,afewmultibilliondollardecisionswouldspelldoom forprivateinsurance. Wecouldthenexpectthegovernmenttostepintothisvacuumand createitsownCanadianstylesystemto"bailout"U.S.medicalcare. WhilemostAmericansareignorantofthehorrorsofCanadiancarehavingbeen propagandizedbytheU.S.media,whichforyearshaspaintedafalsebutrosypictureof medicineinCanadaitisapotentialboonforpoliticians. Becausemedicalcareisbasic toourwellbeing,thepoliticalpartythatcontrolshealthcarewouldwieldhugeamounts ofpoweroverindividualsandtheirchoices. Furthermore,eventhoughAmericanswould receivemiserablecare,theycouldeasilybepropagandizedandmanipulatedintonot wantingtogiveitupforfearoftheunknown,justashasbeenthecaseinCanada. Furthermore,theCanadiangovernmenthasfoundthatthepatronageinvolvedin controllinghealthcarehascreatedhugepoliticalbenefitsforthoseinpower. Therefore,mycontentionisthatthiscurrentdrivetoopenHMOstoallkindsoflawsuits isnotdriven outofsympathyforneedypatientsoranykindof beliefinsocialjustice. Rather,itisanimportantsteptowardthetotaldestructionofprivatemedicalcare. Thisis nottosaythatallsupportersoftherecentbillthatpassedCongresswantsocialized medicine. Instead,theyarethe"usefulidiots"whoalwaysseemtoaccompanytheworst ofleftistschemestoendalleconomicfreedom. Ofcourse,afterwhateversmallamountsoffreedomwestillenjoyareeliminated,theleft wouldthendiscardthesefolks,sincetheynolongerwouldbeuseful. AsGeorge Santyanawrote,"Thosewhofailtolearnfromthepastarecondemnedtorepeatit." Such willbethecasewiththisbogus"Patients'BillofRights." ____________________ WilliamAnderson,adjunctscholaroftheMisesInstitute,teacheseconomicsatFrostburg StateUniversity.anderwl@prodigy.net