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Why Statists Always Get it Wrong
The von Mises Institute ^ | Monday, February 20, 2006 | Per Bylund

Posted on 02/20/2006 6:24:40 AM PST by Shalom Israel

Why Statists Always Get it Wrong


by Per Bylund


[Posted on Monday, February 20, 2006]
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In a recent article, Carl Milsted uses Rothbard to argue it would be permissible to use force to make people pay for a service of which their benefit is at least double its cost. His conclusion is that it is reasonable, and even preferable, to establish a minimalist state if it is to people's advantage.

As has already been argued by N. Stephan Kinsella, he totally misses Rothbard's point. Furthermore, he fails to show why people would not choose to voluntarily pay for services which would benefit them double, as has been pointed out by Bob Kaercher.

Even so, I wish to offer another analysis of Milsted's reasoning. His article is a good example of why statists always seem to get it wrong — and why they always fail to understand what we're talking about. The bottom line is that they fail to realize the costs of force due to their unwillingness to see the state for what it is. I will therefore use Milsted's own example to shed light on his fundamental mistake.

Milsted takes the case of national defense, which is commonly considered an institution that would face the free rider problem if supplied on the market. Argues Milsted: "suppose the majority assesses a tax on everyone to spread the burden of supporting the new defense system. This is theft of the minority. However, suppose that the economies of scale are such that this tax is less than half of what people would have had to pay for defense on their own."

That's the argument, plain and simple. If it is morally permissible to steal when the victim is compensated double, the equation seems to fit. Well, let's look into this in more detail and see if it really does.

First, consider a situation where everybody benefits, say, $10,000 on a yearly basis from being protected by a national defense. That would mean, if the premise is correct, that it would be morally permissible to force costs of no more than $5,000 on everybody.

Were it a company supplying a service worth $10,000 to each of its customers paying only $5,000 for it, this would be easy. Anyone willing to pay the $5,000 would get the service, and the costs associated with administration and so forth would have to be covered by the $5,000 paid. But Milsted argues the $5,000 should be taxed, and that makes it much more difficult.

First of all, we know state-run businesses and authorities (especially if they are monopolies) tend to be much less efficient than private enterprises. That means people in Milstedistan would get less than they would in a free market society. But even so, there is still the cost of coercion totally neglected by Milsted in his article.

Forcing people to pay for a service means there will always be someone who tries to avoid paying or even refuses to pay. So "we" (i.e., the state) need to invest in collection services to get the money. Now, let's say Murray, who is one of the people we're trying to coerce, goes out to buy a rifle and then declares that he's "anti-government, so get the hell off my property." Perhaps he even threatens to kill the collection agents. Dealing with him would take a whole lot more out of the budget, meaning there is even less to provide for the defense (which is the reason we're in business in the first place).

But that's not all. Let's say Murray won't give us the money no matter how much we ask or threaten him. We will simply have to take it by force, so we need to invest in the necessary tools and we go out to hire a dozen brutes to do the forcing. (More money down the drain … ) It is already pretty obvious we're in a very expensive business; there will not be much defense left if there are a lot of Murrays in our society.

Now imagine our hired brutes go down the street to Murray's house and knock on his door. He sticks his rifle out the window and shouts something about having the right to his property and that he will shoot to kill. Anyway, the brutes try to open his door only to find it is locked and barred. They will have to break in to finally get their hands on Murray's cash.

Our small army goes back to their van to get their tools, then returns to break down Murray's door. Going inside, they manage to avoid all the bullets Murray is firing and they tie him up and put him in the closet. They eventually find that he does not have any valuables and that he keeps his cash in a locked safe. So they have to break it to get the money.

Now we have a problem. To make this operation morally permissible, the benefit to Murray, which we know is $10,000, must be at least double the cost forced on him. The cost is now a whole lot more than the cost of the national defense; it includes administration and collection costs, hiring the brutes and their tools, as well as the broken door and safe, and the time and suffering (and perhaps medical expenses) Murray has lost while we were stealing from him. How much do you think is left from the original $5,000 to invest in a national defense? Not much.

What if Murray suffers from paranoia and therefore had invested $1,500 in an advanced special security door and $2,000 in an extra security safe? Then the total cost of simply getting into Murray's safe would probably exceed the $5,000 we are "allowed" to steal. What then? Should we break in anyway since it is a mandatory tax, only to give him a check to cover what's above the $5,000 mark? That doesn't sound right.

But on the other hand, if we just let him be, more people would do the same as Murray only to get off, and we would have a huge problem on our hands. This is a typical state dilemma: it costs too much to force money from some people, but it would probably be much more "expensive" in the long run not to. It's a lose-lose situation.

Now, what if Murray is very poor and doesn't have the $5,000? Then we would have to take whatever he's got and make him work off the rest. We need to get the $5,000 to cover our expenses of the national defense, and we have the right to take that amount from him. It could, of course, be argued he couldn't possibly benefit $10,000 from a national defense if he has no money and no property. If we trust Austrian economics, that might very well be correct; the benefit of national defense would, like any other product or service, be valued subjectively and thus the benefit would be different for each and every individual.

If this is true, it means we have an even greater problem: the state can rightfully levy costs of a maximum of half the subjective benefit enjoyed. Well, that's a task that would keep an army of Nobel Prize winners busy for a while. If possible, I wonder how much that would cost in the end.

This is the problem statists face on an everyday basis when discussing philosophy and politics. It is easy to make nice equations and formulas, and theorize on great systems and cheap solutions neatly enforced by the state. But when consistently failing to realize the costs of coercion it makes their reasoning fundamentally flawed. Just scratching the surface reveals they really have no clue whatsoever.


Per Bylund works as a business consultant in Sweden, in preparation for PhD studies. He is the founder of Anarchism.net. Send him mail. Visit his website. Comment on the blog.


TOPICS: Business/Economy; Government; Miscellaneous; Philosophy
KEYWORDS: anarchism; libertarian; statism; statist
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To: KrisKrinkle

White Paper on State Citizenship
Address:http://www.worldnewsstand.net/law/white-paper.htm


Another 'allodial rights' site:



"--- There are hundreds of thousands of sovereigns in the United States of America but I am not one of them. The sovereigns own their land in "allodium."

That is, the government does not have a financial interest in the their land.
Because of this they do not need to pay property tax (school tax, real estate tax). Only the powers granted to the federal government in the Constitution for the United States of America define the laws that they have to follow. This is a very small subset of the laws most of us have to follow.
Unless they accept benefits from or contract with the federal government, they do not have to pay Social Security tax, federal income tax, or resident individual state income tax.

They do not need to register their cars or get a driver's license unless they drive commercially.

They will not have to get a Health Security Card.

They can own any kind of gun without a license or permit.

They do not have to use the same court system that normal people do.

I am sure that most people reading this are saying to themselves that this can not be true. I know I did when I first heard of it.
The government recognizes two distinct classes of citizens: a state Citizen and a federal citizen.

A state Citizen, also called a de jure Citizen, is an individual whose inalienable natural rights are recognized, secured, and protected by his/her state Constitution against State actions and against federal intrusion by the Constitution for the United States of America.

A federal citizen, also called: a 14th Amendment citizen, a citizen of the United States, a US citizen, a citizen of the District of Columbia, has civil rights that are almost equal to the natural rights that state Citizens have.
I say almost because civil rights are created by Congress and can be taken away by Congress.

Federal citizens are subjects of Congress, under their protection as a "resident" of a State, a person enfranchised to the federal government (the incorporated United States defined in Article I, section 8, clause 17 of the Constitution).

The individual States may not deny to these persons any federal privileges or immunities that Congress has granted them. This specific class of citizen is a federal citizen under admiralty law (International Law).

As such they do not have inalienable common rights recognized, secured and protected in the Constitutions of the States, or of the Constitution for the United States of America, such as "allodial" (absolute) rights to property, the rights to inheritance, the rights to work and contract, and the right to travel among others. ---"


501 posted on 02/28/2006 8:25:07 PM PST by tpaine
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To: tpaine

I'm sure you didn't mean to but your going to send me to bed laughing.

I couldn't help it when I got to the word "allodium."

It just struck me as something an alchemist from the Middle Ages would talk about and I broke out laughing and couldn't get any further.

I'll try and look at the rest of it tomorrow.


502 posted on 02/28/2006 8:45:32 PM PST by KrisKrinkle
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To: KrisKrinkle
I deny signing by any means any kind of contract or agreement with the blanket terms you are trying to force on me

Force is not involved. My property is my own. If you don't want any sort of contractual relationship with me, then stay off my property. Once you enter my property, you have entered some sort of relationship with me: if you entered illicitly, then you've entered a predator-prey relationship; if you entered licitly, then you entered a contractual one.

Nobody forced you into anything, because nobody forced you onto my property.

when all the while you refuse to acknowledge you have any obligation under the social contract because you did not agree to it

I refuse to acknowledge any positive obligations whatsoever. The only obligation that exists a priori is the negative obligation not to aggress against another's person or property.

If I find myself on someone else’s land, the implication being that I did not intend to be there...

The classic example is "falling there from an airplane." The answer is that there are various reasons I would grant you a limited waiver--i.e., permission to get off my land--but I am not obligated to do so. Observe that if you fell onto a military base from an airplane, you would be either arrested or shot, and yet you'd somehow find that understandable. Likewise, my home is my military base. I may feel bad for you, landing there by accident and all, but that doesn't enforceable positive obligations.

I do claim the right to defend myself against his acting on his delusions and I claim the right as a member of our society to explain myself to judge and jury.

Those "rights" are not legitimate, unless you and I are already bound by prior agreement.

503 posted on 03/01/2006 3:58:11 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: KrisKrinkle
I deny signing by any means any kind of contract or agreement to that effect...

You don't have to. Property rights are inalieneable. Call it "natural law" if it helps you grasp it: the fact is that you don't have to agree to anything before I'm empowered to defend myself and my property. If you don't like that, then you'll have to learn the hard way. I'll explain to your heirs that it was self-defense, and they'll accept it, sorrowing.

The right to KBA is not dependent on a separate someone selling his personnel property...

You're confusing the "Bill of Rights" with actual inalienable human rights. The BoR is a list of rules restricting government in order to prevent government from violating those inalienable rights. It isn't perfect, but it's better than what we have now. Lawyers refer to those restrictions as "rights", but they mean "legal" rights, not fundamental human rights.

In any society that respects (1) private property and (2) non-initiation of force, citizens must be able to keep and bear arms. Not because of the second amendment; these societies presumably don't have the US constitution in the first place. Nevertheless, government (and anyone else) would be powerless to take your guns away.

Why is that? Because, firstly, you have the right to self defense, so your possession of weapons cannot be interpreted as the threat of illegal aggression. Secondly, nobody can tell you not to make, buy or sell a gun. Ergo, any attempt to disarm you by force is illegal, and you have the right to defend yourself from it.

One of the characteristics of property is ownership and ownership can change.

That is not inherent to property; what makes property property is that you own it, not your ability to sell it.

If you could give up ownership of yourself, someone else would own you. Normal people believe that when one person owns another, one is a slave and the other a slaver.

Rothbard argues cogently that selling oneself is inherently impossible, because obeying the commands of a "master" is itself a consensual act. Others counter that you can indeed voluntarily enter into contractual slavery. I agree with those others, but point out that the contract cannot be enforced per se; rather, it must identify specific penalties for default, whereby the person can essentially "buy himself back".

But note that to be valid, a contract must be voluntary. If you want, you can take a job; if you really want to, you can also sign a contract allowing your boss to tell you where to live, who to marry, and giving him custody of any future children.

The critical point of contract law, however, is that it must be possible to quit, possibly subject to some sort of fine or penalty. This fact is essentially why Rothbard argues that contractual slavery is literally impossible, because he regards slavery as characterized by the fact that you can't quit. To that extent he's right, and "indenture" would be a much more accurate term.

An open area of research concerns what sort of penalties may or may not be assessed for violating a contract of indenture, and precisely how those limits are determined in the context of a libertarian legal code.

Or were you just making a cheap ad hominem when you brought up "slavery"?

504 posted on 03/01/2006 4:13:37 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: Shalom Israel
You acknowledge:

In any society that respects (1) private property and (2) non-initiation of force, citizens must be able to keep and bear arms.
Not because of the second amendment; these societies presumably don't have the US constitution in the first place. Nevertheless, government (and anyone else) would be powerless to take your guns away.

Why is that? Because, firstly, you have the right to self defense, so your possession of weapons cannot be interpreted as the threat of illegal aggression. Secondly, nobody can tell you not to make, buy or sell a gun. Ergo, any attempt to disarm you by force is illegal, and you have the right to defend yourself from it.


Yes indeed, our Republic respects both private property and the non-initiation of force, and that citizens must be able to keep and bear arms as per the second amendment.
Therefor, government (and anyone else) should be powerless to take your guns away from you on the way to or from work.

Why is that? Because, firstly, you have the right to self defense, so your possession of weapons cannot be interpreted as the threat of illegal aggression. Secondly, nobody should be able to tell you not to make, buy or sell a gun. Ergo, any attempt to disarm you by force is illegal and unconstitutional, and you have the right to defend yourself from it.
Leaving your gun in a locked vehicle while at work is, -- as you admit, -- an "actual inalienable human right".

505 posted on 03/01/2006 7:35:45 AM PST by tpaine
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To: tpaine
Yes indeed, our Republic respects...

Sigh. I clearly stated that my observation applies to every society that respects those things. I've asked you to stop with your illiterate replies; please comply.

Therefor, government (and anyone else) should be powerless to take your guns away from you on the way to or from work.

Conclusion: the US government does not respect private property and the non-initiation of force. It only partially respects those things. In many, many cases, it freely takes others' property, or regulates their property, or otherwise initiates aggression against citizens.

Leaving your gun in a locked vehicle while at work is, -- as you admit, -- an "actual inalienable human right".

I repeat my request concerning your illiterate answers. I have no right to prevent you making, buying or selling guns--but I have an absolute right to keep you off my property, using deadly force if necessary.

506 posted on 03/01/2006 7:45:38 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: Shalom Israel
KrisKrinkle:

I deny signing by any means any kind of contract or agreement with the blanket terms you are trying to force on me.

Izzy responds:

stay off my property. Once you enter my property, you have entered some sort of relationship with me: if you entered illicitly, then you've entered a predator-prey relationship --

This "predator-prey relationship"/ absolute 'allodial' ownership stuff is total bunk.
Land ownership in the USA is constantly disputed.

One example occurs when land owners block hunting access to public lands. IE; -- I once shot a buck on National Forest land several miles south from where I had entered on a public road.
On my map I noticed a dead end section line road less than a mile away east from my kill at the beginning of private property. I packed the deer out to the dead end road, and found it not in use and illegaly posted by the adjacent owner. Ignoring the bogus 'no trespassing' sign, I continued packing out to where the road was in public use.

The owner saw me, and threatened to call the sheriff. I called his bluff, and the sheriff told him to get a life, -- that he couldn't block off a section line access easement.

Under izzies theory, the land owner could have shot me? -- Bull.

507 posted on 03/01/2006 8:15:25 AM PST by tpaine
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To: Shalom Israel
I've asked you to stop with your illiterate replies; please comply.

You are posting to a 'forum' for debate. If you don't want comments made that rebut your positions, make them to Kris by private FReepmail.

I repeat my request concerning your illiterate answers.

"Illiterate" is a personal flame. Please: NO personal attacks.

508 posted on 03/01/2006 8:29:09 AM PST by tpaine
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To: tpaine
Under izzies theory, the land owner could have shot me? -- Bull.

It wasn't his land. If it were his land, he could.

509 posted on 03/01/2006 8:56:42 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: tpaine
"Illiterate" is a personal flame.

I repeat: if you can't debate with even a semblence of rational thought, and without ridiculous misrepresentation of the opposing arguments, then do us both a favor and don't.

510 posted on 03/01/2006 8:59:00 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: Shalom Israel
Yes indeed, our Republic respects both private property and the non-initiation of force, and that citizens must be able to keep and bear arms as per the second amendment.
Therefor, government (and anyone else) should be powerless to take your guns away from you on the way to or from work.

Conclusion: the US government does not respect private property and the non-initiation of force. It only partially respects those things.

Nevertheless, under our Constitution, - government (and anyone else) should be powerless to take your guns away from you on the way to or from work.

Any attempt to disarm you by force is illegal and unconstitutional, and you have the right to defend yourself from it. Leaving your gun in a locked vehicle while at work is, -- as you admit, -- an "actual inalienable human right".

I have an absolute right to keep you off my property, using deadly force if necessary.

You invited me to park on your property while working. You have no right to disarm me, as you admitted just above.

511 posted on 03/01/2006 9:06:43 AM PST by tpaine
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To: tpaine
You invited me to park on your property while working.

No, I didn't. I invited unarmed employees to park. You aren't an unarmed employee, so you are not included in that invitation. If you attempt to force your way onto my property, I will defend myself. You can't claim that because Bob, who is unarmed, is invited, therefore I must invite you.

512 posted on 03/01/2006 9:10:27 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: Shalom Israel
You are free to avoid answering any questions I pose. -- If you can't debate with even a semblance of rational thought, and without ridiculous misrepresentation of the opposing arguments, then do us both a favor and don't.
513 posted on 03/01/2006 9:13:26 AM PST by tpaine
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To: Shalom Israel
Furthermore, he fails to show why people would not choose to voluntarily pay for services which would benefit them double

It's quite simple - people are not rational. Also they are fallible and are often unable to see what is in their interest.

514 posted on 03/01/2006 9:21:30 AM PST by edsheppa
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To: edsheppa
It's quite simple - people are not rational. Also they are fallible and are often unable to see what is in their interest.

Up to a point I agree with you. In fact, it's one of the biggest arguments against government: do you really want to be under the authority of a non-rational being that is often unable to see what's in his own best interest, let alone yours or mine?

515 posted on 03/01/2006 9:26:09 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: Shalom Israel
You posted at #504:

Any attempt to disarm you by force is illegal

Thus, leaving your gun in a locked vehicle while at work is, -- as you admit, -- an "actual inalienable human right".

I have an absolute right to keep you off my property, using deadly force if necessary.

You invited me to park on your property while working. You have no right to disarm me, as you admitted just above.

No, I didn't. I invited unarmed employees to park.

US citizens, as you admit, -- have an "actual inalienable human right" to be armed. You have no 'right' to demand they be unarmed in order to park while at work.

If you attempt to force your way onto my property, I will defend myself.

You invited me to park and to work. Having a gun in my vehicle is not using 'force' against you.

You can't claim that because Bob, who is unarmed, is invited, therefore I must invite you.

Both Bob and I have an inalienable right to carry arms in our vehicles while at work, as you admit. -- Any attempt to disarm Bob by force is illegal.

516 posted on 03/01/2006 9:31:32 AM PST by tpaine
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To: tpaine
Both Bob and I have an inalienable right to carry arms in our vehicles while at work, as you admit. -- Any attempt to disarm Bob by force is illegal.

I can throw a party and issue a public proclamation that all persons over 5'10" in height are permitted to enter my property and attend the party. At the gate I erect a "You must be this tall..." sign, and in struct my bouncers to bar entry to anyone shorter than the sign. If someone actually tries to force his way onto the property, the bouncers (who are armed) are ordered to shoot.

My neighbor can throw a party at which anyone with a shooting iron may attend. Everyone entering the gate must display his weapon to his guards, who then deputize him. Anyone failing to demonstrate that he is armed is ordered to leave the property. If he refuses, the guards--and all deputies--are instructed to open fire on the trespasser.

My neighbor on the other side, feeling bad for the rejects at my and my neighbors' houses, can throw a party and invite only persons under 5'10" who have no firearms. His bouncers will check the height of guests, and pat them down. Violators--meaning anyone who is too tall and/or who has a firearm--will be ordered to leave by his guards. Anyone attempting to force his way onto the property will be shot.

Which of those three lacks the right to carry out his plans? All three? Only the third? And how exactly do you explain this owner's lack of power over his own property?

517 posted on 03/01/2006 9:39:35 AM PST by Shalom Israel (Pray for the peace of Jerusalem.)
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To: Shalom Israel
“Force is not involved.”

Do you deny bringing “fiery vengeance” and shooting into the discussion or are you saying they aren’t forms of force?

“Nobody forced you into anything, because nobody forced you onto my property. “

From a previous post: “My assumption was that I was on your land through no fault of my own, that I was run off the road…”

“permission to get off my land--but I am not obligated to do so. “

I deny signing by any means any kind of contract or agreement that I need your permission to get off your land.

“Those "rights" are not legitimate, unless you and I are already bound by prior agreement.”

I deny signing by any means any kind of contract or agreement to that effect.

In addition, you’re saying that my claim to explain myself to a judge and jury is not legitimate, which means you claim that my right to a trial by jury is not legitimate. Do you ever read your own stuff?

(Perceptive Lurkers: It was only a nibble.)

518 posted on 03/01/2006 6:11:57 PM PST by KrisKrinkle
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To: Shalom Israel
“Call it "natural law" if it helps you grasp it: “

In nature, one who wants what another has just takes it if possible. Remember your “Chain of theft”?

“Property rights are inalieneable.”

Shouldn’t you return whatever property you obtained as a benefit of your Chain of theft?

“If you don't like that, then you'll have to learn the hard way. I'll explain to your heirs that it was self-defense, and they'll accept it, sorrowing. “

Who wrote “Force is not involved”? (“Force is not involved” was a cut and paste from whoever posted it.)

And in the unlikely event you prevail, my heirs may sorrow but they won’t accept it. You will have initiated “Blood Feud” (at least in your fantasy and maybe reality too). The best you’ll be able to do is stay hidden somewhere on the pitiful plot you claim, perhaps scurrying out at night to resupply. That is the world of your vision.

“You're confusing the "Bill of Rights”…”

Your comments have no relevance to what I said since the ability I noted could be used 9800 years before the “Bill Of Rights” or tomorrow.

“…you own it…”

And ownership of something can change. You don’t have to sell it or anything; it can even be stolen from you.

“Or were you just making a cheap ad hominem when you brought up "slavery"?”

With all seriousness I absolutely in no way intended an ad hominem. It didn’t even occur to me that you might take it that way. I just wanted to point out the inherent contradiction in the statement “one's self is one's property,” and prompt you to think about that. You obviously have.

But you still threw in some assumptions to which I have to reply that I fail to recognize the validity of you making all the rules, setting terms and conditions, then declaring that I have agreed to an implicit contract you contrived for your own convenience when I deny signing by any means any kind of contract or agreement with the blanket terms you are trying to force on me, and you threaten me with violence for not meeting an obligation to which I did not commit to when all the while you refuse to acknowledge you have any obligation under the social contract because you did not agree to it in the same way that I did not agree to your unilateral ravings. You can’t have it both ways.

519 posted on 03/01/2006 6:23:14 PM PST by KrisKrinkle
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To: tpaine

"This "predator-prey relationship"...stuff is total bunk."

Even a blind hog finds an acorn once in a while.

I was already starting to think of him as a predator or parasite; the kind of thing productive, cooperative people join together to get rid of.

If he wants to admit himself as such, I say let him.


520 posted on 03/01/2006 6:29:36 PM PST by KrisKrinkle
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