Friday, July 13, 2012

Are Bureaucrats Losing Control in America?

Gary North thinks so:

Americans are learning how to beat the system, cheat the system, and outfox the system. As the bureaucrats tighten their many nooses, Americans are finding ways to slip the noose.

An article in Forbes offers examples. They are everywhere. Businesses are just ignoring the rules. They hire lawyers to help them avoid the law. They are fed up with the federal squid. They are not cooperating.

This is significant for the future. The heart of every legal system is legitimacy. If the government — family, church, or civil — is viewed as legitimate, people who are under its jurisdiction cooperate. They add self-government to external systems of sanctions.  If they refuse to do this, the government’s enforcement system cannot force them to obey consistently. The system does not have enough resources to enforce compliance.

At some point, the government loses its ability to gain its goals. Collecting more taxes in Greece is not possible. The Greek government can promise austerity, but it can gain this only by reducing spending, not by collective more taxes. The same is true of Spain. The same is true of Italy.

If the people who live under the regime think the regime is corrupt, they cheat. They feel no guilt. If they think a law is immoral or stupid, they refuse to cooperate. The government can do little to change this outlook, other than shrink. No government does this voluntarily.

The federal government is now at the limit of enforcement. The bureaucrats write 83,000 pages of new rules every year, yet the country changes only slowly. The bureaucrats think they are in charge. They are not.

Read more here.


  1. Milton Friedman in 1961 wrote a perceptive piece on this topic.

    "The erosion of the capital stock of willingness to obey the law reduces the capacity of a society to run a centralized state, to move away from freedom. This effect on law obedience is thus one that is reversible and runs in both directions. It is another major factor that needs to be taken into account in judging the likely stability of a free system in the long run."

    The full article , from "The New Individualist Review" is on line. here. Recommended

  2. I used to get a visit from OSHA every year in my shop since my involvement in 2003. Each visit was good for fines between $1000 and $1500. The last straw for me was 2007 when I was fined $500 for having water in a spray bottle not labeled "water".

    I decided that being squeezed by both the gov't and the economy was getting to be too I researched and waiting for them to show up in 08'. When they came in I refused them entry and they look shocked. They actually tried to claim I couldn't do that. I said "Yep, I can-go get a warrant".

    2 months later the regional head shows up at my door with a warrant, bragging in a way, "What, did you think we weren't going to do it?". I made him sit in my office as I read the entire warrant. Not only were there fabrications about their first visit when I told them to go away, but I noted to him that per their own policy their were only supposed to be visiting me every OTHER year.

    He actually didn't believe me and snatched the warrant out of my hands to read it himself. I told him not only were they violating their own policy, but the warrant had false testimony in it and also didn't specifically call out WHAT was to be inspected(and it's suppose to). I told him I was debating still not letting him in on that basis and that we may need to stand together in front of his administrative judge(what BS that is).

    He then said, "If you let me in I promise not to fine you for anything I find wrong". LMAO!

    I let him in...but after the inspection told him not only should I not see him for 2 years that if he or his workers were coming back after that time that they'd need a warrant every time to come in to my shop. I asked him how many businesses were doing like me, he answered in his 35 years of working for OSHA that I was his first in his region.....

    They've never been back since now(4 years).

    If every business owner did like me OSHA would probably be having major revenue issues....

    1. Bravo. Let's hear from other business owners.

    2. In 2010, I lost my job due to the fact that business slowed down by more than 50% in Oct 2008. I defaulted on all of my credit cards at the same time after doing the math and realizing that I couldn't pay my bills plus the minimum amount on the credit cards while collecting unemployment.

      After avoiding the phone calls from the primary lender for two months until they ended up calling my parents trying to reach me, I finally got up and did the research on what really happens when you default on the credit cards.

      After hundreds of hours of research, I learned that most people get it wrong. In regards to credit cards, the laws still favor the debtor, not the lender. The primary lenders tend not to do anything but wait six months then sell your information to collection agencies. According to Federal Law, if the debtor fails to ask the collection agency in writing to validate the debt within 30 days of receiving their official letter then the debt is "assumed" to be valid. You can still fight this at any stage in the process, but it's easiest doing it from the beginning.

      So I've asked every debt collection agency to validate the debt every time I get their letter and I've never been harassed or sued. Next year the debt will be too old to collect on due to the Statute of Limitations. What amazes me is that I end up educating each and every one of these debt collectors what the validation letter actually means. They cannot call, sue or collect until they validate the debt.

      When people tell me that this is not true, I can only point out that this is per federal law, the Fair Debt Collection Practices Act.

      The average American is in $9000 worth of credit card debt. Very few ever pay off the debt, most end up defaulting on the debt when they truly can no longer make the payments. If every debt slave did like me, the Big Banks would be petitioning to change the debt collection laws to favor them and not us.

  3. It's not the first time Gary North has written along this line of thinking. See:

    How to Gum Up Any Institution

  4. The 'Barter' economy and outright collusion to avoid the USA government is already significantly larger than you think.

    This is also the cost of TARP; when the government saves the 'rich,' and cause economic recession and lingering stagnation to do it, watch out.