Monday, January 16, 2017

What is “Legal Tender”?

Once again, this time on the Galt’s Gulch Online message board, my conservative comrades displayed a disappointing though predictable ignorance about money. For people who claim to honor the bourgeois virtues of trade and commerce, they collectively guard a treasury of incomplete, incorrect, erroneous, and falsified assertions.  In truth, objective investigation demonstrates that the government has the right, the need, and the obligation to define and create legal tender.
 
Gold. Coin-shaped. Issued by Congress.
Not Money. Not Legal Tender.
Last week (about January 8, 2017), this discussion was launched:
Posted by $CBJ 1 week ago to Economics

Several writers declaimed against “legal tender laws.”  So, I asked (rhetorically) for definition of “legal tender.” dbhalling, an attorney-at-law who specializes in intellectual property rights wrote this:
(cut and paste) Posted by  dbhalling 5 days, 20 hours ago [January 9, 2017 --mem]
Here is the exact statute. "Today the legal tender law in the US is 35 USC § 5103 which states: United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tender for debts. Why legal tender laws do not require government monopolies on money absolutely, they are almost always used for that eventually. You just wrong that any Legal Tender law is consistent with Objectivism..  (/cut and paste)

Of course, that is not actually a definition. As a lawyer, dbhalling only cares about what the law says. He does not need to investigate further. Moreover, he was not alone in claiming that an “Objectivist government” would not have the power to create legal tender. But if there were such a thing as an “Objectivist government” it would need to define legal tender, as does any government. 
Deed for Sale of Federal Land.
A valuable paper promise of the Government.
Perhaps negotiable. Not money. Not Legal Tender.
According to Ayn Rand’s Objectivism, and in line with much else on the libertarian right wing of American politics, the proper functions of government include operating courts of law. It is for the courts that the legislature defines “legal tender.” If the legislature did not define legal tender, there would be no way to know when a debt has been discharged, or when payment has been made.
 
One Dollar in Lawful Money.
Like much else in our traditional laws, the idea of debt is still mired in the agrarian feudal Middle Ages, and not yet enjoying the free air of commercial city life, i.e., civilization. In fact, very little trade is “cash on the barrel head.” It never has been. Since at least 2000 BCE, merchants have dealt at distances in both space and time, making and keeping promises to buy now and pay later. (See, for instance, The Kingdom of the Hittites by Trevor Bryce, Oxford University Press, 2005.) We now enjoy a vast global city. Cash is accepted – even preferred – on the street, but retailers buy from wholesalers who buy from manufacturers, all on credit and via debt.
 
One of the most valuable
coin-like objects issued by
the Federal government.
Not money. Not Legal tender.
Contrary to common myths, money did not evolve out of barter; and barter did not originate in the desire for economic gain. (See David Graeber’s “Debt: The First 5,000 Years” here.) Ritual gift exchange is taproot of commerce.  For tens of thousands of years, including two ice ages from about 35,000 YA to about 10,000 YA, strangers became friends by exchanging gifts.  Finally, after writing was invented to keep track of commodity promises, we abstracted “money” as a safety to mitigate risk.  If you promise a sheep, but all of your sheep have died, what can you give instead? 

Wheat was first. Then after about 2000 BCE, silver was accepted. The astonishing attribute of silver is that it is useless.  It is pretty when polished, but it cannot hold an edge without being alloyed.  (The same is true of copper, which is why the Bronze Age is a demarcation along our common advance. And we have archaeological evidence of large “oxhides” of bronze offered in trade.) Silver served as “legal tender” i.e., money recognized by the “courts” (king or temple).  Gold is likewise useless, but has the added value of not tarnishing, and being far less commonly found. 
Code of Ur-Nammu
(fragment)
 18. If a man knocks out the eye of another man, he shall weigh out one-half a mina of silver. 
19. If a man has cut off another man’s foot, he is to pay ten shekels. 
22. If a man knocks out a tooth of another man, he shall pay two shekels of silver.
24. [...] If he does not have a slave, he is to pay 10 shekels of silver. If he does not have silver, he is to give another thing that belongs to him.
The Law Code of Ur-Nammu, about 2050 BCE at Real World History here.
In modern times, the governments of the British American colonies created paper money. Whether and to what extent the new Federal government would be allowed to do that was debated. The Constitution did not forbid Federal paper money, and the necessities of commerce almost demanded it. The Federal government had the power to borrow money. That created the power to create promissory notes under the Necessary and Proper clause.  
Coinage Law of June 28, 1834 recognized several foreign coins
as legal tender. Laws before and after this also 

defined the legal tender status of foreign coins.
Moreover, in the USA until 1857, several types of foreign coins were commonly recognized by law as being “legal tender.”  The Spanish Dollar was the foundation of commerce, both for international and local trade. Bank notes from the early 19th century promise to pay fractions of a dollar, but display images of Spanish or Mexican coins.  (See “Spanish Coins on American Notes” here.)
Promises 25 cents. Offers 2 Reales.
(Hence, "2 bits" means a quarter dollar.)
Finally, all governments create a plethora of medals, medallions, certificates, promises, and warrants that may be valuable, negotiable, even fungible, but are not recognized in courts of law as legal tender. That is why a government must define the term in order for objective law to be possible.
  
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Sunday, January 15, 2017

A Partial Index of Ideas within this Blog

I write about whatever interests me.  Below is a representative sample from the 454 previous posts.

Language and Thought
Philosophy
Computers and Computer Security
Military 
Criminology and Protective Services
Scientific Fraud and Research Misconduct
Science and Mathematics
Nerds
Science Fiction 
Industrial Design, Consumerism, Austin Culture
Numismatics and Economics

Sunday, January 8, 2017

Ten Most Popular Page Views

Since, I opened this blog on January 2, 2011, these articles have tallied the most readers.

(3600 pageviews. January 6, 2012)
At the end of the 1939 movie version of The Wizard of Oz, Glinda the Good Witch says that Dorothy could have gone home any time, but she had to learn that for herself.  Scarecrow asks Dorothy what she learned.  …  Clearly, what begins as a cliché ends as a contraction.

(2721 pageviews. August 13, 2013)
This grew out of a discussion on Galt’s Gulch Online.  Ayn Rand suggested that as admirable as the Constitution is, not having been based on a consistent philosophy, it contained the seeds of its own destruction.

(1800 pageviews. May 27, 2014)
With help from my anarcho-capitalist comrades here in town, we brought a screening of this movie and its author here for a weekend.
With a cameo by Ron Paul, Alongside Night is the story of the final economic collapse of the United States. We see it through the eyes of 16-year-old Elliot Vreeland.  Elliott searches for his father, a Nobel laureate economist who was targeted for arrest because he consulted with the Europeans to create a gold-based currency that effectively destroyed all confidence in the U.S. dollar. 

(689 pageviews.  July 3, 2013)
Bob Swanson was 29 when he provided the money for Prof. Herbert Boyer to start Genentech.  Like all overnight successes, the real story is more complicated, with deep roots.  Bright, accomplished, and motivated, Swanson had obvious potential – and a string of failures to show for it.

(603 pageviews. September 1, 2013)
Dr. William Herbert Sheldon, Jr., (1898 – 1977) came from a privileged family. The philosopher William James was his godfather. Sheldon created the 70-point grading scale that is the standard in modern American numismatics.  He also pioneered the study of Early American Copper, the Large Cents and Half Cents struck until 1857. He also stole coins from the American Numismatic Society; and he defrauded other collectors.

(555 pageviews.  December 28, 2011)
In these days of anti-capitalist protest, it is important to know that keeping track of debts led to the inventions of counting and writing, and eventually gave voice to art.

(359 pageviews. September 13, 2014)
What you tax you get less of; and what you subsidize you get more of.  The brightest people in the world are making video games; and no one is on the Moon.  It did not take a genius to figure this out: it is a universal law of human action

(342 pageviews. November 25, 2011)
In Economics 101, the Supply curve and the Demand curve are displayed.   The point where they intersect is called “equilibrium” where the most efficient allocation of resources is claimed to occur.  This ignores the fact that the other choices do not disappear. People are still demanding and supplying all along both curves.

(337 pageviews. August 10, 2013)
Scripophily is the study of stock certificates, bonds, and related fiduciary instruments. It is a subset of numismatics, the art and science that studies the forms and uses of money. Like coins, banknotes, checks (drafts), and tokens, stock certificates reveal the daily life and work of the times. And like other numismatic items, they can be highly artistic.

(323 pageviews.  May 20, 2014)
In point of fact, such a claim would be unnecessary, as for instance, "Republicans for Bush" or "Republicans for Palin."  Logic demands that we accept Voldemort as a Democrat and allow that some Republicans favor his reign.

POPULAR THIS WEEK
In addition to those above, these were among the other posts that recently gained some attention.

(88 pageviews. December 25, 2016)
The defining attribute of fans of the Atlas Shrugged movies is that they are people who want to set themselves apart in a separate, isolated and hidden community of like-minded people. Many dream of a physical locale. Most enjoy online communities. In those discussions, the occasional reports of attempts at a “Galt’s Gulch” receive close attention. Although the plot element of “Galt’s Gulch” served a poetic purpose, it was not a call to action.

(14 pageviews. September 26, 2016)
A short snorter is paper money, signed by people who share a common experience. During World War II, with 16 million men and women in the American armed forces, the custom spread rapidly. After the war, it faded just as quickly.

(7 pageviews. January 23, 2013)
Products become icons because of the insightful and compelling work of advertising.
Art & Copy (2009) is a film by Doug Pray.  “Everything that was done to launch that product is now done differently because of that product. ... Every computer company on the planet does their ads on a Mac.” – Lee Clow, creator of the Macintosh “1984” ad.

(5 pageviews. February 5, 2014.)
"Some of the best things in life are free / If you can steal them from the bourgeosie!" When Bill Ayres and Bernadine Dohrn came to Eastern Michigan University to speak to the New Students for a Democratic Society in 2010, I was there. Bill did not recognize me even though I was at the Flint War Council, December 27-31, 1969.

(4 pageviews. May 31, 2105)
Imagine a successful protest in Berlin 1943 against the Holocaust.  Between February 27 and March 6, about 200 German women stood outside a detainment center, demanding the release of their Jewish husbands. …  "Researchers used to say that no government could survive if just 5 percent of the population rose up against it," Chenoweth says. "Our data shows the number may be lower than that. No single campaign in that period [1900-2000] failed after they'd achieved the active and sustained participation of just 3.5 percent of the population." She adds, "But get this: every single campaign that exceeded that 3.5 percent point was a nonviolent one. The nonviolent campaigns were on average four times larger than the average violent campaigns."

JUST TO NOTE
I found a mirror site in Sweden:  http://necessaryfacts.blogspot.se/  I did not set it up; someone else unknown to me did that.  I also found that many readers come here via a Russian site, yandex.ru, which I have never visited because my personal protection is not strong enough for me to go gallivanting.

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Sunday, January 1, 2017

Most Popular Pageviews

I write this blog for myself. As a contract technical writer, I get paid to write what other people want. I enjoy it. That work is near the top of my Maslow Hierarchy as self-fulfillment. But it is still primarily for other people, work for hire. This is my own diary. 

I do publicize some of the essays here. Even so, I only have seven followers. So, to have 178,133 pageviews in five years is interesting, if not laudable. Just under 100 times a day, someone else reads something here. But who reads what?

Sometimes, readers from Russia, China, or India have taken first place. Occasionally, other areas pop up in the standings. Usually, of course, most of the hits come from Americans. If I were not an American, that might not be true, but, of course, America dominates the Internet.

To me, the curious fact is that the most popular essay is "What (if Anything) Did Dorothy Learn?" which examines the penultimate scene of the 1939 film, The Wizard of Oz. Not in this blog, but available elsewhere, is an article that I wrote about the political, economic, and numismatic references in L. Frank Baum's classic fantasy. It appeared first in the Centinel of the Central States Numismatic Society, Vol. 58, no. 2, Summer 2010, p.58-61 as "The Wizard of Oz: Child's Tale or Numismatic Allegory?"  That issue is archived on the Newman Numismatic Portal here.

Generally, the articles here are about science and technology, numismatics, politics, and science fiction. But those easy rubrics mask what I consider to be more interesting threads.

Nerds, geniuses, and gifteds make it possible for the rest of us to survive. When the great glaciers were melting, we might have had one genius every three or four generations. Now, with 6 billion people on Earth, we have more of them all the time. And I am glad that we do.

Recently, I started writing about the military. On November 22, 2014, I volunteered to join the Texas State Guard. I came to that opportunity by way of contract technical writing. I was on assignment with the Texas Division of Emergency Management within the Texas Department of Public Safety. There, I found out about the work of the TXSG, which evacuates people from danger, manages shelters, carries out ground search, and other duties. My next assignment was for the office of the Executive Director of the Texas Military Department. So, it was easy to volunteer.  And I am learning a lot about leadership which is better than management for everyone in the business world. 

Numismatics is the art and science that studies the forms and uses of money. Numismatics opens the door to history, language, fine art, culture, commerce, and, of course, economics. It is a large lacuna that the great economists were not themselves "coin collectors." (A modern exception is George Selgin, author of Good Money: Birmingham Button Makers, the Royal Mint, and the Beginnings of Modern Coinage.)  Money has many forms and functions, and numismatics is about much more than coins. 

I love cities. I admit that a week in New York is about two days too many, but having lived in two small towns and two villages (in America), a city of one or two million is just about right for me. Austin is perfect. My choices aside, megacities are the jewels of planet Earth.

When I was in graduate school (2009-2010), I had a criminology class in Miscarriages of Justice that focused on misconduct in police laboratories and junk science in the courtroom. From there, I expanded my reading into laboratory misconduct and academic fraud. The two areas are inter-connected. They each can be extended to include electoral voting fraud.

But I write about whatever interests me from astronomy to firefighters. Apparently, other people find some of it interesting, also, and I am glad that they do.

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Most Popular Necessary Facts
100,000 Page Views
World Peace Through Massive Retaliation
Armies Without Weapons
Debt: The Seed of Civilization
B-Sides Austin 2016

Sunday, December 25, 2016

Against Gulching

"Gulching" refers to setting up a retreatist community of political conservatives. It is named after Galt's Gulch in Ayn Rand's Atlas Shrugged.

Saturday Night Live ran this in the wake of the GOP victory in the Presidential election of 2016:
In The Bubble, the election never happened.
View on YouTube here.
On the Objectivist discussion board, Rebirth of Reason, frequent contributor Luke Setzer posted a link to the video under the headline "Turning Galt's Gulch on Its Ear." In the discussion there, I said that no successful society is monolithic.

The defining attribute of fans of the Atlas Shrugged movies is that they are people who want to set themselves apart in a separate, isolated and hidden community of like-minded people. Many dream of a physical locale. Most enjoy online communities. In those discussions, the occasional reports of attempts at a “Galt’s Gulch” receive close attention.

Although the plot element of “Galt’s Gulch” served a poetic purpose, it was not a call to action. Ayn Rand was specific in stating that art is not didactic: a romance novel does not teach. When Ayn Rand had something to teach, she wrote essays and delivered lectures. Rand’s intention as a philosopher was to create and explain the ideas that can liberate individuals, human society in general, and the United States of America in particular.
 
New York City from ClassicHistory.com
Admirers of the works of Ayn Rand generally have two goals: to improve their own lives by living better; and to change the world. They intend to achieve the latter by spreading the ideas of Objectivism until they are accepted by (arbitrarily) “enough” other people. Their goal is a cultural shift more dramatic than the rise of classical Greece or the Renaissance.  Specifically:
(1) reason, science, and philosophy replace religion
(2) the ethics of egoism become as widely accepted as the tenets of altruism are today
(3) capitalism displaces socialism
(4) government is limited to basic functions of law and order by protecting the rights to  property.
(5) the observably dominant works of art (painting, sculpture, architecture, literature, theater) project rational people living in a knowable universe.
Cleveland's West Side Market indoor space.
(cleveland.com)
The inherent contradiction in “Objectivist culture” – the common interactions in-person and online among those who admire the works of Ayn Rand, perhaps just best called “Rand Fans” – is the dichotomy between reaching out to teach other people and walling yourself in with a group of individuals who claim to believe the same things that you do.
 
In the language of Objectivism, “in Atlas Shrugged, the heroes withdraw their moral sanction from their destroyers.” In other words, not only do they stop obeying the economic regulations of the government, they divorce themselves from anyone who would claim a right to any moment of their lives. They want nothing to do with looters and moochers. That is the active ideal of a Rand Fan in dealing with other people.

The problem that they cannot solve is that the capitalist who owns a gas station is a Muslim. The capitalist who owns a convenience store is a Hindu. It is a fact that Costco founder James Sinegal is an ardent Democrat.  The greatest capitalists of our age – George Soros, Bill Gates, Warren Buffett, and the entire list of global billionaires—are all condemned as “crony capitalists” traitors to laissez faire, who cause and amplify the oppressive laws, taxes, and regulations under which we suffer, but they, by the power of their privilege do not. Objectivism does have its own real-life capitalists. Three that stand out are T. J. Rodgers of Cypress Semiconductor, Ed Snider (1933-2016) of Comcast Spectacore, and John Allison of BB&T. Many others orbit in the pull of Ayn Rand. Mark Cuban (Dallas Mavericks) and Frederick W. Smith (FedEx) are among them. But Cuban supported Hillary Clinton for President. 

Cleveland's West Side Market outdoor space
from Delta Sky Magazine
As explained by Ayn Rand and her one-time colleague psychologist Nathaniel Branden, most people harbor unresolved personal contradictions. If the Muslim who owns a gas station were consistent in his philosophy, he would recognize that the principles that bring success in business – identifying facts, testing theories, treating customers fairly  - speak against the tenets of his religion. If the crony capitalists were consistent, they would deny their government subsidies and advance laissez faire.
 
I and M Bank Market, Nairobi 
What do you do when other people do not live up to your expectations for philosophical consistency?

For many Objectivists, as distinct from mere “fans of Ayn Rand,” the unworkable solution is to withdraw from those who disagree with you. So, it is ironic that the philosophers of the Ayn Rand Institute who do not speak to the philosophers of the Atlas Society probably buy their gasoline from Muslims and get their cars fixed by Christians and find great bargains at big box stores owned by Democrats all the while running Windows software on their computers.

The minor premise of "Gulching" and a theme that is easy to find among fans of Atlas Shrugged, is that in order for there to be a second Renaissance, civilization must collapse. They do not just predict it, they look forward to it with a millenarian fervor. 

The fact is that civilization is, literally, city life. Historically, people from disparate tribes left (and still leave) their homes to come to the places where strangers benefit themselves by exchanging value for value, whether or not they agree on any other fact, claim, or belief.  That cultural matrix is powerful. Examples of farming communities destroyed by crop failures are easy to find. Harder to uncover are cities that starved. Total war does bring that. Fortunately, such wars are exceptional. Examples from the Dutch wars of liberation from Spain show that when the city rulers attempted to control the price of food, the city went without and fell. Cities that let the price of food rise incentivized smugglers to run the Spanish lines. A farm feeds itself (theoretically), but a city is fed by the whole world.  It does not matter that the Chilean farmer whose grapes are on your table has a religious icon in his home. If you cut yourself off from him - and the global commercial network - you only have the grapes you grow yourself... if you grow grapes, rather than apricots, kiwi fruit, watermelon, coconuts, ...

ALSO ON NECESSARY FACTS
Megacities 
Cities 
City Air Makes You Free  
Vectures: Monetizing Urban Transportation  

Friday, December 16, 2016

Not Less Grammar Errors

Public radio delivers a cachet of culture and higher education. So, I hear a bellwether when presentations lead away from my expectations for correct grammar. Last night, on KUT-FM, a show on the death penalty opened with the statement that Texas is executing "less people" than in the recent past. I would have said "fewer people." KUT-FM here in Austin is not alone in that. I hear it often, but read it less frequently.

Languages change. As strangers learn to live together civilized languages tend toward larger vocabularies and simplified grammars. We still have archaic plurals "children," "oxen," and (less common) "brethren" in our daily speech. Also, common plurals "fish" and "deer" are still with us.  (Fishes and deers refer to different kinds of the same thing: trout, sharks, and carp are among the fishes, though Luca Brasi simply sleeps with the fish.)  We still have "goose-geese," and "mouse-mice," and but not "moose-meese" or "house-hice." An old King James Version of the Bible might have "kine" as the plural of "cow" but you will not hear it even in Texas cattle country.

So, we will hear less references to "fewer." Personally, I prefer fewer degradations of common grammar. Grammar defines thought. Sloppy grammar allows inexact and incorrect mental formations. Weak thinking leads to bad actions. You cannot have a gallon of executions.  Opponents of the death penalty should remain focused on the fact that executions are discrete events that happen to individuals.

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Monday, December 12, 2016

Newtonmas 2016: Great Man or Social Forces?

December 25 is the traditional birthday of Sir Isaac Newton(1).  So, some fans and followers of physics, and perhaps some professionals, celebrate Newtonmas on December 25.  The TV sitcom, The Big Bang Theory brought the holiday to millions who had not heard of it.(2)  The question remains: Why celebrate Newton, rather than Descartes, Einstein, or many other scientists?
  • Sir Isaac Newton represented Cambridge at Parliament.
  • He offered an original proof of the binomial theorem, what in high school we learn as “Pascal’s Triangle.”
  • He developed an algorithm for rapidly approximating square roots.
  • He investigated light and demonstrated that “white” light is composed of discrete colors.
  • Based on his experiments with light, he invented the reflecting telescope.
  • He invented calculus.
  • He invented calculus as part of his general proof of the laws of motion, including the motion of bodies under the influence of gravity. He showed that motion on Earth is not different from motion in the heavens. That was a radical departure from 2000 years of philosophy.
  • He served as warden and master of the British Royal Mint for 30 years. His tenure began with his rescuing the British economy from near certain collapse. He had himself sworn as a magistrate so that he could investigate counterfeiting, going in disguise to pubs.

If he had done any one of those, he would have earned a place in history.  He did all of them. 

That brings up the problem of “the great man” versus “social forces.”  If Newton had died in infancy, as he was truthfully at risk, would someone else –Robert Hooke, Rene Descartes, Gottfried Leibniz – have filled the void?  Would we have waited until 1800 or 1900 for the next Newton to invent calculus and achieve all of those other heights?  Did we wait until 1680 because some previous Newton of 1300 died at birth? 

For all of Newton’s specific achievements, his greatest glory may be in being the exemplar of the Age of Reason and the gateway to the Enlightenment.  The Newtonian Revolution was not just about the orbit of the planets.  The American Declaration of Independence and the American Constitution are consequences of the work of Sir Isaac Newton. The founders of our republic sought natural laws to inform their designs for a just and workable republic with a balance of powers.  As late at the 1830s, diametrically opposed philosophers August Comte and Herbert Spencer attempted to devise “social physics” as a science of human action. They each gave up on that label and settled for mere “sociology.”

(1) Note: Newton was born in 1742.  The English Parliament passed the Calendar Act in 1750 to take effect on 2 September 1752, which was followed by 14 September 1752.   Newton’s birthday (New Style) is January 4. Similarly, George Washington was born on February 11, 1732, which became February 22 when the calendar was set forward. The Gregorian reform of the Julian calendar realigned the solar year with the vernal equinox in order to keep Easter in the spring. 

(2) Note: The first Newtonmas was actually celebrated in Japan before 1890.  I recorded a Newtonmas message for the Community Commentator series of WKAR AM/FM, East Lansing, in 1982 or ’83. I sent Newtonmas cards to my friends off and on over several years.  Meanwhile, Kwanza was invented. Then, Seinfeld introduced “Festivus, the holiday for the rest of us.”  Organized atheists began offering Newtonmas as an antidote to Christmas.  Whether and to what extent Newton would have felt honored or horrified is open to debate. Counterfactuals can be unresolvable. 

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