Gary North: Keeping Out the Likes of You
North on alternative medicine:
In the medical field, controls on information are a way of life....
Individuals are legally allowed to say that they found relief by using [a product], but they had better not be associated with the product financially. Individuals' free speech is protected by the first amendment, but not when money is involved. Paid testimonials can result in a company's getting prosecuted. Only when the testimonial is free can it be broadcast, but not by the company.
So, there is no systematic way to get the story to people who can be helped. Only if they find out almost randomly -- on in a third-party newsletter -- will they find out....
This is how it goes when the government makes it illegal to tell the truth or imposes such enormous costs for proving claims that the truth does not get out. In the name of limiting the spread of false information -- as defined by a regulatory agency's staff -- the agency limits the spread of the truth. The consumer is not allowed to make up his own mind.
Of course, all this doesn't hinder the spread of information acquired through Big Pharma's FDA-enforced drug cartel, with state-subsidized R&D (when's the last time you saw an ad that said "Ask your naturopath if Co-Q 10 is right for you"?). The same is true of professional licensing, "safety codes" that add great cost and inconvenience to lower-cost forms of self-built housing like cob houses, etc. They artificially restrict the flow of information (by setting up tariffs on the transmission of technical skill), and increase the cost of newer forms of alternative technology, and thus insulate the privileged legacy technologies from competition.
North on "High Risk Investments":
The government prohibits most investors from taking advantage of high-risk, high-return investments. These are investments that return 15% to 20% per annum consistently. These are not available to "widows and orphans," unless the widow has a net worth of a million dollars. That's the definition of a qualified investor.
Why do these restrictions exist? The official explanation is that people who don't have a million dollars of net worth will fall prey to unscrupulous con men who will get them into high-risk ventures. They will put these naive, unsuspecting investors into investments that these unsophisticated people do not understand. To protect these people, the government makes it illegal for Americans to invest.
Give some thought to the effects of this law. Say that you were rich. Say that you wanted to invest in ventures with an above-average rate of return, year after year. You would have a problem. Word would get out. Fund managers would rush in and buy up the shares, raising their price, thereby lowering the rate of return.
This is what capital markets do. They equalize rates or return, discounted for levels of risk.
The rich man thinks: "Darn! All those fund managers will rush in and spoil the deals."
But wait! What if the government makes it illegal for fund managers to do this unless they are acting on behalf of small groups (say, 99 investors) of people with a net worth of a million dollars? That would keep out the rabble! It would keep the rate of return above market.
Cynics -- of whom I am chief -- might conclude that the law protecting people with a net worth of under a million dollars from entering a particular capital market is in fact a law protecting above-average rates of return for people worth over a million dollars.
Cynics could then draw a broader conclusion: "Almost any law to protect the common man is in fact a law to protect the rich from the competitive bidding of a whole lot of common men."
North on land conservation:
So, rich people become big supporters of land conservation. Land conservation is best defined as "a government program to lock up beautiful land that is located next door to enclaves of high-priced land owned by rich people."