I posted this at Lew Rockwell last week:

“There are two ways to approach the world.

In one, the popular one now, you try to control the bad actors. You create laws to trip them up before hand, or round them up after. You rely on regulations and regulators.

Nothing wrong with that, except that we already have lots of regulators and it didn’t help.

Why?

The reason is so obvious you question the intelligence of anyone who can’t see it. It’s simple. People willing and able to scam the system are going to be willing and able to game the regulations too.

In a fight between regulators and scammers, my money’s on the scammers. They’re usually richer and nastier.

In the second approach, you don’t overlook the bad actors. You hope they get what they have coming to them. But you don’t rely on laws or lawyers because you’re old enough to have figured out that bit about the bad actors being bigger and nastier than the good ones.

So what do you do?

You focus on getting out of the way of the bad guys. You limit the damage they can do to you. And most of all, you figure out how to avoid them in the first place.

Here are five warnings I wish I’d heeded more:

1. Be careful whom you deal with

Don’t lie down with a dog and you won’t get up with fleas. Delousing yourself is much harder than not getting loused up in the first place.

But delousing is what we do a lot of these days. It’s practically the only thing going on in the economy now. Right now there are people all over the country delousing the SEC.. and the Congress… and the banks…and the hedge-funds. There’s even a global delousing effort going on. The fumigators are at work. Pest control is in full force and the exterminators are crawling over the baseboards in the cellar. There’s an international delousing effort at the BIS, with headquarters at Switzerland and local shops all over the world.

A Bug Czar has been crowned and fleas have been declared insecta non grata.
There – that should do it, eh? Any bug with a classical education should figure it out.

Which is another way of saying none of this will work. Or if it works, it won’t work the way you want it to.

The fact is, lice and ticks are at home on a dog. It’s R & R for them. Holiday Inn, Bed & Breakfast, and a luxury spa combined. Get them to leave? Good luck. Much better, don’t take your dog to bed in the first place. Much better, if you have a dog, let him drool in the kennel, not on your pillow.

The short version of all that is we do jack-ass things and then wonder who’s braying.

I say jack-ass with no disrespect. Some say that those who get conned “deserve what they get.”
That is the New Testament of the confidence man and the Sunday sermon of the predator.
As financial doctrine, it occasionally makes sense. As moral insight, it’s almost always junk. Very often victims are only weak, naive, or ignorant. The kind of people who wouldn’t know malice if they saw it in the dollar-bin with a white tag tied to its toe. They’re people who follow the rules, thinking other people follow them too. They’re honorable, so they believe in the honor of their fellow man.

Now, not only is being honorable not wrong, it’s the way things should be. But doves should learn not to coo at snakes, and beautiful souls have to wise up to what goes on in the rest of the world… or expect an ugly life.

So, rule number one. Research the people you plan to make your associates. And don’t dismiss your research. When you find out your prospective partner filed for bankruptcy six times in the last ten years, don’t tell yourself it will be different this time, because it won’t. One bankruptcy is a financial failure. Three is a losing streak. Six is a career decision. Follow your gut instinct.

If your boss conducts business with a wink and a leer, don’t pass it off as southern charm. He’s not Dagwood Bumstead looking for a lump of emotional candy. He’s a creep, and you’re a pawn in his narcissistic chess game. Ask for a transfer about two minutes after that. If you’re out of a job, so be it. There’s no guarantee you won’t be out of one, if you put up with it.

2. Never stop learning

Ignorance kills, as a lawyer friend of mine likes to say. Don’t be ignorant. Learn as much as you can about as many things as you can. Do your research. Know what you’re dealing with. With the internet, it’s much easier. You can do a google search on anything or anyone. You can go into google news archives and find newspaper articles and information from as far back as the 1980s.
So start reading.

Project Gutenberg has thousands of classic books online. PubMed allows you to access medical journals. LexisNexis will allow you to research law. Edgar will show you company filings. You can search houses for sale on Realtor.com and look up where a house is on Google Earth. You can go to WhoIs to find out about domain names and IP address. You can find out how well a website is doing by looking up Technorati or Alexa rankings. The Way Back Machine lets you look up old magazine articles, even when they’ve been pulled off the current site. Some sites like Zabasearch collect people’s information and put it all in one spot. That’s free information. If you pay, you can get much more.

Mind you, I find data sites downright creepy, especially when they’re online, and especially when they’re centralized and can be accessed with a key-stroke. If people have paid for their sins, why not let them start fresh? There may be a recording angel, but surely he lives farther north than DC.

On the other hand, just because the technology is already out there, it pays to keep up with what’s being done with it. Because if it’s out there, your business partner… or your employer… or your enemies ….or your friends.. probably know about it already. They might even have mined it for information to deploy against you. Shouldn’t you be prepared?

3. Limit what people know about you. Many of us from small towns grew up around trustworthy people. Our friends and our neighbors knew everything about us, and we didn’t mind, because no one was malicious enough to hurt anyone else.

The big world isn’t so nice. People who have things to hide themselves will be only too anxious to find something on you, attack being the best form of defense in their minds. If they can’t find anything wrong, they’ll hit you with whatever else they can, even a silly thing you said casually. They’ll dig out what your crazy cousin did fifteen years ago. Or perhaps you saved your husband’s latest rant about his mother online. Don’t be surprised if you wake up one morning to find it in the New Yorker.

So, keep things to yourself, even among close friends and relatives.

That’s a hard one for me. I’m a verbal person. I write, I talk, even if it’s only to myself. Leave me next to a blank wall and I’ll strike up a conversation. And it will be two-way.

Fortunately, most people are unlikely to hurt you. But occasionally you’ll run into a psychopath who will. And if you work in politics, the media, or in business, psychopathy is practically the norm.

So keep track of what’s being written about you on the net with Google alerts. Write to sites that aggregate information and ask for your name to be removed from their lists. You might have to repeat that every year . Put yourself on the national do-not-call list so that your telephone number’s out of the reach of marketers.

And then limit the information you give out, even to your lawyer.
It’s taken me half a lifetime to figure out that any questionnaire shoved under my nose doesn’t automatically deserve to be filled in. Leave things blank unless you’re told it’s mandatory to fill it in. Or become creative. Develop fictitious personalities, throw-away mail addresses, exotic, non-existent addresses. Use another name when doing business. Avoid registering products or filling out questionaires in your own name. Use fake birth-dates and vary them according to a system that you, and only you, know. Change your passwords every few weeks, using a system to keep track. Write them down broken up in alternate pages in a notebook, without anything to signify what the numbers mean. If the book is lost, no one will be able to make use of the information. Neither will you, of course, but losing a little time is better than losing your savings.

Hacking email, spying on private business, blackmailing and outing people, it’s all fair game these days. Attacking the privacy of public figures has become a national pastime – witness the Letterman case. But it’s not just public life. Private business is a circus of outing and shaming too. Corporations spy on and threaten each other, as well as their employees. Employees write tell-all books.

We live in a spy state, where every half-wit believes it’s his divine right to nose into anything, no matter how little it’s his business. So, these days not only is it wise to keep your own secrets, you might be wise to keep other people’s secrets.

But what should you do if inspite of that, you become a target of an attack on your privacy?
Often, nothing, unfortunately.

I’ll give you the example of an aunt of mine who didn’t want anyone to know she was sick, in case it would prejudice employers against hiring her. A colleague not only hacked her email but forwarded details about her illness to dozens of people. A frail, sensitive woman, her health broke down under the stress.

I’ll give you the advice I gave her. Say your piece once in private, and say it once in public. Then forget about it. Move on. You’re not the first person to have been screwed over and you won’t be the last. Innocent people are constantly being ruined by the powerful and the unscrupulous. That’s the ugly truth of our system. Reputations are often lost, unjustly. Our salvation is to worry less about our reputations and more about our consciences.
What we do where no one can see and none can retaliate is the test of who we are.

As for what others think, the world is a large place. Move far away, if you need to. As for the system, stop trying to reform it. It’s beyond reform.

4. Learn to say no

Telling someone no doesn’t come naturally. We’re trained to go through life being agreeable. In fact, learning to say no might be the hardest thing you learn. But it might also be the most important, and once you learn it, it can become good sport.

Speaking for myself, I’ve come to relish saying no to pests. And the nay-saying that gives me the greatest pleasure of all is nay-saying to internet marketers. It’s not that I’m ever rude to one. I never hang up. My malice is much deeper. I let them prattle on, even asking polite questions. Then I stop them courteously and ask them why they think they have the right to call me on a weekend and waste half-an-hour selling me something I didn’t ask for. Occasionally, when they’re especially pushy, my toying becomes cruel. I turn the tables on them. Instead of selling me things, they find themselves signing petitions or supporting causes or accepting market analysis or invitations to baby showers or anything else at hand.

Can I call you, I ask. Tonight? Tomorrow? I press them to reply. Can you buy two? Now? Pretty soon, they’re begging to hang up.

Try it and see. It’s balm in gilead.

I advise you to use this technique on rude or uncooperative colleagues too. Give them a taste of their own medicine, and do it generously. Let their cup run over. You will get something better than love. You’ll get respect.

5. Learn how to retaliate

Despite all the myths propagated about forgiveness, I’ve learned that submitting meekly to injustice usually breeds weakness, resentment, and ill- health. There’s nothing that drives up your self-respect as much as socking it back to bullies. I’m not advising being unduly aggressive. Try a friendly approach as long as you can. But when that doesn’t work, time to get tough. Throw some metaphoric crockery. Thumb your nose and thumb it publicly. Turn on the spotlight and watch the cockroaches run.

In other cases, all you may need to do is wait. Time has a knack of delivering even the biggest fish to a patient angler…and when that moment comes, don’t flinch. Yank that line and watch your target flop and wriggle on the sand.

Watch with a smile. Defy the received wisdom and develop a healthy conscience about revenge. It’s highly moral. Only our wimpy but violent age derides its feline nobility.

The uncomfortable truth is the New Testament is meant for people on the same moral level of development….for family.. and for friends. But in the big, dirty world, the Old Testament works much better.

Gandhi said an eye for an eye and the whole world goes blind. I say an eye for an eye, and after the first blind man, everyone else’s eyesight gets better in a hurry.

Become a moral vigilante. Why waste time going through the system if you can get better results outside of it? Use the law to warn, to shame, to threaten. But don’t labor under the delusion that a court case always helps. Your enemy will pour his time and money into creating mushroom clouds of paper. He’ll drown you in verbiage and “accidentally-on-purposes.” He’ll postpone and prevaricate and petition. He’ll appeal and block and delay…. and hide behind a fog of corporate black ink like an injured squid.

Instead, if you’re obliged by professional ethics to speak up, consider other channels of actions besides the court. Try mediation or arbitration. Perhaps you’re better off complaining to the Better Business Bureau. Or posting on a consumer forum.

Monetary compensation is often not the best justice either. It can make you look like an extortionist. Try going public. Give the bully a taste of his own medicine. Post the hacker’s private information on a website. Put him on the run. That might not make you rich, but the moral satisfaction is tremendous.

Of course, it could also be dangerous. You risk violating the law yourself. In that case, you might be best off to leave your job. Maybe even leave town. Leave the thugs to the mercies of the universe. It sometimes does a better job of retribution than it’s given credit for. Villains do not always go to jail. And if the skeptics are right, they might never go to hell. But they often get dragged into divorce court, which is a good deal worse, from all accounts.

And meanwhile, there are all those other ways the wicked verily get their reward.
Envious rivals cut their throats; the tax man cometh, and the SEC with him; and then cometh old age, failing libido, dead-beat in-laws and brain-dead grandchildren. The inheritance get squandered and the sycophants and courtiers vanish with the money. The trash-mouth gets acid reflux, the glutton gets dyspepsia and the aging lecher ends up alone, romancing his own hairless skull and wrinkled hide.

Then at the end comes the greatest punishment of all for persisting in evil deeds. You stare into the mirror and evil stares back at you, looking not so much devilish as hollow and bewildered, less like a fiend from hell and more like a Goldman CEO at a Congressional hearing.

Hannah Arendt taught us about the banality of evil. It was left to our age to practice the evil of banality. Habit, laziness, gullibility, ignorance, vanity, greed, fear, cowardice, bravado. We are duped not by heroic evil, but by humdrum vice.

The greatest and best defense we have against the charlatans and knaves who brought our society to its knees is not the law.

It is self-knowledge and discipline.”