What ‘freedom’ looks like in Cuba

How would you like to prohibited from migrating within your own country? That’s apparently the situation in Cuba, according to this CNN story.

Thanks to a mid-1990s law, rural migration to Havana is restricted, making it possible for Cubans to be illegal residents in their own capital city:

The government deported tens of thousands of people or forcibly removed them from Havana to other parts of the island,” said Daniel Wilkinson, America’s deputy director at Human Rights Watch. “It’s just one in a series of laws that place severe restrictions on Cubans [and] how they live, where they live, and where they work.”

“I was caught because I was an illegal,” explained a bicycle taxi driver as he gripped the rusted blue handle-bars of his vehicle in Havana’s Central Park. “And because I’d been here several times before, I was deported back.”

But the driver working his trade in the capital city did not arrive in Cuba from another country. Instead he is among the thousands who have come from rural provinces in search of work and a place to live – but who have been deported back because of “Decree 217.”

The 1997 law restricts rural migration to Havana, making this taxi driver an illegal resident in his own capital city.

“If you’re illegal you can’t be here in Havana,” said the driver, originally from Cuba’s eastern Holguin province. “You don’t have an address here in Havana.”…

Economic conditions were generally worse at the eastern end of the island, according to Cuba analyst Edward Gonzalez, a professor emeritus at the University of California Los Angeles.

“[The eastern region] has always been the less affluent, impoverished part of the island,” he said, “heavily dependent upon agriculture, less on tourism, and also happens to be more black and mulatto.”

The effort to keep migrants out and prevent overcrowding in Havana may have resulted in police discrimination against darker-skinned Cubans presumed more likely to be illegal, Gonzalez said.

But have no fear, there’s universal health care for everyone, even if those in the poorest part of the country are restricted from migrating and even if the average Cuban suffers long waits at government hospitals and many services and technologies are available only to the party elite and foreign “health tourists” who pay with hard currency. 

(Hat tip: Coyote Blog)

Slavery, Government and Capitalism

In a letter to the New York Times, Don Boudreaux of Cafe Hayek disputes the paper’s criticism of libertarianism and its assertion that “It was only government power that ended slavery.”

Slavery was common throughout history until the age of industrial capitalism and only then did it disappear, Boudreaux writes.

“Slavery was killed by capitalism because that institution puts a premium on creativity, initiative, and good judgment (which even the mightiest slave-master’s whip cannot extract from its victims), and because the ethos that gives life to capitalism – free-market liberalism – is hostile to the ownership of man by man,” he adds. 

“That the first-to-industrialize English were the first abolitionists is no coincidence.”

Boudreaux adds that in North America, pressure brought by capitalism to end slavery was countered by the very agency many today praise as slaves’ liberator: government. 

“From 17th and 18th century slave codes to the Fugitive Slave Acts of 1793 and of 1850, government in America actively deployed force on behalf of slaveholders,” he writes. “Without this force, slavery would never have taken root as deeply as it did in the U.S. and would have died away sooner and with less bloodshed.”

An interesting theory, and one that would appear to be supported by the fact that the places which eradicated slavery last were the least industrialized.

That slavery still exists today – particularly in unindustrialized parts of Africa, the Middle East and South Asia – would also seem to back up Boudreaux’s premise.

Copernicus reburied as hero in Poland

Nicolaus Copernicus, the 16th-century astronomer regarded as the first individual to hold that the Earth revolves around the Sun, was reburied by Polish priests as a hero on Saturday, nearly 470 years after he was laid to rest in an unmarked grave.

The ceremonial reburial of Copernicus in a tomb in the medieval cathedral at Frombork on Poland’s Baltic coast is seen as a final sign of the Church’s repentance for its treatment of the scientist over his theory that the Earth revolves around the Sun, declared heretical by the Vatican in 1616, according to the Times of London.

Copernicus (1473-1543) died as a little-known astronomer working in a remote part of northern Poland, far from Europe’s centers of learning. He had spent years laboring in his free time developing his theory, which was later condemned as heretical by the Catholic Church because it removed Earth and humanity from their central position in the universe.

Copernicus had postulated that the Earth rotated on its axis once a day and travelled around the sun once a year, opposing the Church-backed Ptolemaic theory that the Earth was fixed at the centre of the universe, with the sun and stars revolving around it, wrote Agence-France Presse.

His revolutionary model was based on complex mathematical calculations and his naked-eye observations of the heavens because the telescope had not yet been invented, according to The Associated Press.

After his death, his remains rested in an unmarked grave beneath the floor of the cathedral in Frombork, the exact location unknown.

“On Saturday, his remains were blessed with holy water by some of Poland’s highest-ranking clerics before an honor guard ceremoniously carried his coffin through the imposing red brick cathedral and lowered it back into the same spot where part of his skull and other bones were found in 2005,” The Associated Press reported.

A tombstone now identifies him as the founder of the heliocentric theory, but also a church canon, a cleric ranking below a priest. The tombstone is decorated with a model of the solar system, a golden sun encircled by six of the planets, The AP added.

Scientists began searching for the astronomer’s remains in 2004 and eventually turned up a skull and bones of a 70-year-old man – the age Copernicus was when he died. A computer reconstruction made by forensic police based on the skull showed a broken nose and other features that resemble a self-portrait of Copernicus.

In a later stage of the investigation, DNA taken from teeth and bones matched that from hairs found in one of his books, leading the scientists to conclude with great probability that they had finally found Copernicus.

In recent weeks, a wooden casket holding those remains has lain in state in the nearby city of Olsztyn, and on Friday they were toured around the region to towns linked to his life.

Wojciech Ziemba, the archbishop of the region surrounding Frombork, said the Catholic Church is proud that Copernicus left the region a legacy of “his hard work, devotion and above all of his scientific genius.”

Saturday’s Mass was led by Jozef Kowalczyk, the papal nuncio and newly named Primate of Poland, the highest church authority in this deeply Catholic country.

Jacek Jezierski, a local bishop who encouraged the search for Copernicus, said that he considers Copernicus’ burial as part of the church’s broader embrace of science as being compatible with Biblical belief.

Copernicus’ burial in an anonymous grave in the 16th century was not linked to suspicions of heresy, according to The Associated Press report.

When he died, his ideas were just starting to be discussed by a small group of European astronomers, astrologers and mathematicians, and the church was not yet forcefully condemning the heliocentric world view as heresy, according to Jack Repcheck, author of “Copernicus’ Secret: How the Scientific Revolution Began.”

The full attack on those ideas came decades later when the Vatican was waging a massive defense against Martin Luther’s Reformation.

“There is no indication that Copernicus was worried about being declared a heretic and being kicked out of the church for his astronomical views,” Repcheck said.

“Why was he just buried along with everyone else, like every other canon in Frombork? Because at the time of his death he was just any other canon in Frombork. He was not the iconic hero that he has become.”

Copernicus’ major treatise – “On the Revolutions of the Heavenly Spheres” – was published at the very end of his life, and he only received a copy of the printed book on the day he died – May 21, 1543.

Criminalization of free market economics

Author Laurence M. Vance offers some common sense thoughts on “victimless crimes,” including charging excessive interest rates, price gouging and ticket scalping.

Usury, Vance writes, involves charging an “illegally high” interest rate, whatever the government determines that to be. This artificial distinction between interest and usury is a crime in all 50 states.

The entire legal concept of usury is flawed, he argues:

Usurers – that is, moneylenders, have been despised throughout history. In Dante’s The Divine Comedy, usurers are in the seventh circle of hell along with blasphemers and sodomites. But as the late economist Murray Rothbard pointed out, moneylending is a business in the market like any other business: “If the number of usurers multiplies, the price of money or interest will be driven down by the competition. So that if one doesn’t like high interest rates, the more usurers the better!” Although it might be immoral to charge above a certain rate of interest in some circumstances, it should certainly not be illegal. How could anyone possibly calculate what the maximum rate of interest should be and then apply that to every situation? And what should be the basis of the rate? Should it be the prime rate, the federal funds rate, the discount rate, or the LIBOR rate? The common-sense approach is simple: If you don’t want to borrow a sum of money at what you believe is a usurious rate of interest, then don’t borrow the money. But, some will say, we need the state to regulate interest rates to protect consumers. But how is preventing a willing lender and a willing borrower from doing business helping consumers?

Price-gouging laws are predicated on the fallacy that there is a just price for every good and service, Vance writes:

The U.S. Department of Energy even maintains a “Gas Price Watch Reporting Form” where people who know nothing about supply and demand, refinery capacity, gasoline futures, world surplus production capacity, and the price of a barrel of crude oil can report price gouging by gas stations. These laws are very similar to usury laws. In some circumstances, it might be immoral to charge above a particular price, but it should certainly not be illegal. There is no such thing as a just price. One cannot support price-gouging laws without ascribing omniscience to the state. How else could the state determine what the correct price should be? From an economic standpoint, we know that what is called price gouging is simply nothing more than charging what the market will bear. Price-gouging laws violate the property rights of resource owners, they hinder the price system’s signaling ability, they contribute to the misallocation of resources, and they cause shortages. Once again, the common-sense approach is the simplest: If you don’t like what you think is the inflated price of an item, then don’t buy it.

Vance calls ticket scalping one of the most ridiculous examples of a victimless act ever labeled as a crime.

“What precept of any ethical system would frown upon a willing seller and a willing buyer exchanging tickets for cash, as long as it was not violating the property rights of the owner of the ground where they made their exchange? Ticket scalpers perform a valuable service and should be applauded not condemned.”

(Hat tip: Wrisley.com)

Collexis now a true penny stock

Collexis Holdings has not only completed its descent into penny stock range, it’s exceeded it.

The Columbia tech company, which has been on life support for some time, saw its stock dip below 1 cent a share Thursday, to seven-tenths of a cent per share.

That means you could buy 1,000 shares of the troubled company for $7, although broker fees would likely cost more than the stock itself.

Collexis lost more than $16 million between the middle of 2007 and the first three quarters of fiscal year 2009, the most current data available.

The company filed a notice of termination of securities with the US Securities & Exchange Commission last November, which likely means it will never file another financial statement with the SEC.

Collexis announced to great fanfare in 2007 plans to relocate to Innovista, the University of South Carolina’s taxpayer-funded boondoggle. That move never happened.

Collexis’s stock, which sold for as much as $12 a share in 2007, closed Thursday at 1.1 cents a share.

TSFG suitor may be looking at Georgia

Just days after entering the Carolinas by brokering a deal for troubled South Financial Group, TD Bank Chief Executive Bharat Masrani said his company may soon be ready to connect the geographic dots from South Carolina to Florida by entering the Georgia market.

Once its deal for Greenville-based South Financial is complete, TD will have locations all along the East Coast except in Georgia, a state that has been ravaged by bank failures and figures to see plenty more before the current economic downturn is over.

To date this year, eight Georgia institutions have failed. In addition, 25 Peach State banks went under in 2009.

Masrani told the Philadelphia Business Journal that while the bank is always exploring opportunities, it might be more inclined to take some time to digest its latest acquisitions, which include purchases in Florida in addition to TSFG.

After more than two years of hemorrhaging red ink, The South Financial Group announced Monday that it would be acquired by TD for a paltry 28 cents a share.

Under the agreement, TD, parent of the Toronto-Dominion Bank, will acquire all outstanding shares of common stock of TSFG, for about $61 million in cash or stock.

The deal represented a 60 percent discount to South Financial’s previous Friday closing of 67 cents.

TD said it would pay another $130.6 million in cash to the United States Treasury to buy $347 million of South Financial preferred stock.

TSFG has lost nearly $1.4 billion over the past two-plus years, including $85.8 million during the first three months of 2010.

South Financial recently entered into a consent order with the Federal Deposit Insurance Corp. and the SC State Board of Financial Institutions and a written agreement with the Board of Governors of the Federal Reserve System and the Federal Reserve Bank of Richmond over its capital levels.

Masterpieces go missing in Paris

Wednesday evening, a lone individual entered the Paris Museum of Modern Art through a broken window, evaded security alarms and stole five paintings by Picasso, Matisse and other artists in a daring theft valued at as much as $125 million.

The five paintings were Picasso’s cubist masterpiece “Dove with Green Peas” (1912), Matisse’s “Pastoral” (1906), George Braque’s “Landscape with Olive Tree” (1906), Amedeo Modogliani’s “Woman with a Fan” (1919) and Fernand Leger’s “Still Life with a Chandelier” (1922).

The stature of the paintings would make them extremely difficult to sell in the art market, raising questions about whether the theft was a form of kidnapping to demand ransom from the museum, according to the New York Times.

So, what could possibly become of these paintings?

“They could never be publicly resold, which means they must be disappearing into private collections or functioning as bartering chips on the black market, trading for 10 percent of their value,” writes The Economist. “The image of a wealthy recluse in need of Modigliani’s femme fatale for his study is a romantic one, but stolen-to-order heists are relatively rare.”

In a paper called “The Underworld of Art,” published in 2008 in the journal Crime, Law and Social Change, R.T. Naylor argued that art insiders are often involved in these illegal operations, as they “alone have the technical knowledge and circle of intimates necessary to link an illicit supply with a demand.”  The criminal underworld he depicts – an illicit mirror image of the legal art world, with all works running through similar channels – is also an intriguing one. But it seems more likely that underpaid museum employees are involved in such thefts, and that the stolen works are either traded for other illegal goods and services, or used as legal bargaining chips by criminals with even greater black marks on their record.

Stolen art works rarely resurface – only 12 percent to 15 percent do, according to the London-based Art Loss Register, which also counts Picasso as the world’s most stolen artist, according to The Economist.

The burglary is the biggest since four paintings by Cezanne, Degas, Van Gogh and Monet valued at more than $160 million were stolen from a Zurich museum in February 2008, according to Agence-France Presse.

(Above painting: Dove with Green Peas, by Pablo Picasso, 1912.)

Kansas now part of ‘the land of cotton’

Virginia, Florida and Kansas aren’t considered “traditional” cotton-growing states, but that hasn’t stopped the federal government from making each officially eligible for the Cotton Research and Promotion Act.

The US Department of Agriculture has published the final rule designating the three as cotton-producing states for purposes of representation on the Cotton Board in the Federal Register, according to Southeast Farm Press.

The provision included in the 2008 farm bill provided that Virginia, Florida and Kansas, each of which now have a core group of cotton producers, be separate states in the definition of ‘‘cotton-producing state’’ so that they may have representatives on the Cotton Board.

The three are among the smallest-producing cotton states in the US: Between 2003 and 2008, Virginia produced an average of 143,000 bales of cotton annually, Florida produced 125,000 and Kansas produced 88,000, according to Cotton Council International.

By comparison, seven states produced an average of more than 1 million bales of cotton annually during that period, led by Texas, which produced nearly 6.3 million bales.

South Carolina, which suffered a substantial slump in cotton production in 2008, still averaged 338,000 bales during the half decade.

TSFG to media last week: ‘Business as usual’

Just last week South Financial Group Chief Executive Lynn Harton said the Greenville company was taking steps to reverse its troubled course, and that he was confident its Carolina First subsidiary would be able to raise the additional capital required by federal regulators.

“The only way to fix things is to face them and call them like they are and move on,” Harton told The Greenville News in a May 13 story.

Harton said he was optimistic about investor activity because of signs that economic conditions have improved, capital markets are opening up and stock and bond markets are improving, he said.

Yet, just a few days later, the company announced it was being acquired by TD Bank Financial Group for a paltry 28 cents a share. Compare that to two years ago, when South Financial stock was trading for more than $17 a share.

The Monday announcement caused TSFG’s stock to fall from 67 cents to 30 cents in a single day.

In the Greenville News article, Harton said the regulatory requirements would strengthen the company. In the meantime, it’s business as usual at the bank, he said last week.

“Particularly given the environment, prepping the company for success long term, we’ve done extremely well,” Harton told the publication. “If you look at our internal measures of clarity of vision, they’re stronger than they have absolutely ever been.”

He told the News that his management team has stressed to employees, shareholders and customers that it was no surprise that federal regulators stepped in recently with an order to strengthen Carolina First’s financial position.

The bank’s consent order with the Federal Deposit Insurance Corp. sets deadlines for raising capital levels and mandates a reduction in the amount of assets considered “substandard” and “doubtful.”

Now, less than a week later, Harton no longer has to worry about raising capital levels and troubled assets. Instead, he’s got to face such issues as shareholder lawsuits.

Chavez: Turning chicken salad into chicken sh*t

Venezuela is one of the world’s great energy powers. Its oil reserves are among the world’s largest and its hydroelectric plants are among the most potent.

Yet the South American country’s economy is in desperate straits, thanks in large part to the socialist policies of President Hugo Chavez, according to a report by National Public Radio

“Blackouts plague major cities,” NPR reports. “Its inflation rate is among the world’s highest. Private enterprise has been so hammered, the World Bank says, that Venezuela is forced to import almost everything it needs.”

Venezuela’s economy contracted 3.3 percent in 2009 and is expected to shrink further this year. Few business owners see a rosy future, at least in the short term.

 Jose Guerra, a former Central Bank economist, says Chavez’s state intervention in private business is battering the economy.

“The government is nationalizing, expropriating, or confiscating,” he told NPR. “They are not creating new wealth; this is wealth that was already created.”

And, adds NPR, if that weren’t bad enough, another factor is hobbling the economy — an unprecedented energy crisis.

“Critics say a lack of investment, coupled with government ineptitude, left Venezuela without the electrical generation capacity it needs. The government blames a brutal drought,” according to the report.

“Whatever the reason, cities such as San Cristobal go dark every day — sometimes for four hours or more, as the government uses rolling blackouts to save energy.”

Ah, good times, indeed. Keep up the stellar work, Mr. Chavez.

(Hat tip: Coyote Blog)