JOHN STOSSEL: No Regulation? No Problem. Intuition leads us to think—wrongly—that without government we’d be victims of fraud.

It is scary to think about a world without regulation. Intuition leads us to think that without government we’d be victims of fraud, as I explain in my latest book, “No, They Can’t!” But our intuition is wrong.

Consider this: An entire sector of the economy operates almost entirely without government controls. Complete strangers exchange big money there every day.

It’s the Internet. It does have regulation, just not government regulation.

On my next TV show, titled “Freedom 2.0” (which the Fox Business Network airs this Thursday at 9 p.m. EST), economics professor Ed Stringham explains that Paypal.com, which transfers billions of dollars for people, at first assumed they needed government help to prevent fraud.

“They faced fraudsters from all over the world. They turned to the FBI,” says Stringham. “But the FBI had no idea who these people were.”

So PayPal invented a new form of regulation. “They developed a private fraud detection system, where they used computers to say, ‘This might be fraudulent,’ and then it would send it to a human to investigate that.” That dramatically reduced fraud, and PayPal thrived.

Most people who are victims of fraud don’t find law enforcement especially helpful.

MICHAEL GRAHAM: “Did Republicans end up winning the ‘fiscal cliff’ deal?”

REGULATION: Iceland won’t let teen use her given name. “Her name sounds more mainstream than Icelandic singer Björk or billionaire entrepreneur Björgólfur Thor Björgólfsson, but since it’s not included in the country’s registry of 1,853 approved girl names, she can’t use it.”

GETTING IT GOOD AND HARD: At Democratic Underground, a poster asks: “What happened that my SS withholdings in my paycheck just went up?”

HE’S BEEN REELECTED, SO THERE’S NO NEED TO PRETEND: Women Excluded From White House Meetings. “The White House’s Flickr account recently released a photo of President Barack Obama and his top advisers. The complete absence of women in the image is another reminder that females are underrepresented in Obama’s staff. Additionally, the president still pays his female employees significantly less than their male counterparts.”

TECH HAS BEEN ON OF THE FEW ECONOMIC BRIGHT SPOTS BECAUSE IT’S LESS REGULATED. SO . . . Tech Giants Brace For More Regulatory Scrutiny.

ACADEMIC NEW YEAR’S RESOLUTIONS YOU WON’T KEEP. I pretty much do the “write every day” part . . . .

JOHN HAWKINS: The 20 Most Annoying Liberals of 2012.

AND YET, COMPARED TO THE OBAMA ADMINISTRATION, HE’S SMALL CHANGE:

A few years ago, at a Las Vegas convention for magicians, Penn Jillette, of the act Penn and Teller, was introduced to a soft-spoken young man named Apollo Robbins, who has a reputation as a pickpocket of almost supernatural ability. Jillette, who ranks pickpockets, he says, “a few notches below hypnotists on the show-biz totem pole,” was holding court at a table of colleagues, and he asked Robbins for a demonstration, ready to be unimpressed. Robbins demurred, claiming that he felt uncomfortable working in front of other magicians. He pointed out that, since Jillette was wearing only shorts and a sports shirt, he wouldn’t have much to work with.

“Come on,” Jillette said. “Steal something from me.”

Again, Robbins begged off, but he offered to do a trick instead. He instructed Jillette to place a ring that he was wearing on a piece of paper and trace its outline with a pen. By now, a small crowd had gathered. Jillette removed his ring, put it down on the paper, unclipped a pen from his shirt, and leaned forward, preparing to draw. After a moment, he froze and looked up. His face was pale.

“Fuck. You,” he said, and slumped into a chair.

Robbins held up a thin, cylindrical object: the cartridge from Jillette’s pen.

Also, Robbins gives the stuff back.

NEWS YOU CAN USE: Food Stamps Aren’t for iPads … They’re for Food, People.

CREAM: Sunshine Of Your Love.

HOW TO CRIMINALIZE being a boy.

GREEN CAR UPDATE: Some Chevy dealers ceasing Volt sales due to costly tools.

AVOIDING TICKETS: Confessions Of A Traffic Cop.

AT AMAZON, New Year’s Markdowns on Tax Preparation Software. Great for everyone whose name isn’t Tim Geithner.

Also, foreign language software.

FREEDOM 2.0: I’ll be on the John Stossel show tonight on Fox Business at 9.

WRITE GAMBLING SOFTWARE, GO TO PRISON?

In a criminal case sure to make programmers nervous, a software maker who licenses a program used by online casinos and bookmakers overseas is being charged with promoting gambling in New York because authorities say his software was used by others for illegal betting in that state.

New York authorities say that about $2.3 million that Robert Stuart and his company, Extension Software, received in cash and money orders for licensing his software constitutes direct proceeds of illegal, U.S.-based bookmaking operations.

“These defendants abetted large-scale illegal gambling in the U.S. and abroad,” said District Attorney Cyrus R. Vance, Jr. in a press release in October when Stuart was charged. “In doing so, they gave bettors an easy way to place illegal wagers, and created an appetite for further unlawful activity.”

But Stuart, who has been charged along with his wife and brother-in-law with one felony count for promoting gambling in New York through their software firm, says that his company sells the software only to entities outside the U.S. and that he’s not aware of anyone using it in the U.S. or using it to take illegal bets in the U.S. He also says the software doesn’t place bets, it simply provides online gambling sites with the infrastructure to select and display which sporting events they want to offer for betting and also stores the bets.

Pathetic.

AN INTERVIEW with Greg Lukianoff on his Unlearning Liberty: Campus Censorship And The End Of American Debate.

ROGER SIMON: Leftism: ‘Forget It, Jake. It’s Chinatown.’

Leftism has devolved into a kind of scam run not only on others but also on the self. Leftists are brilliant at convincing themselves of their own altruism and then broadcasting it to the public, thus providing cover for the most conventionally greedy and selfish behaviors. We see that in our society all the time: the quondam Marxists of Hollywood, the media, and the academy blathering on about economic equality while living lives the Medici could not have dreamed of.

Part of this construct is a “prevent game,” a public persona and system erected so privilege cannot be questioned or undermined. A nomenklatura more successful and sophisticated than anything ever conceived in the Soviet Union. The result of this is a highly stratified society. As is well known but scarcely reported, blacks and Latinos have actually done worse under Obama than other groups. Normally, that would be unconscionable, considering the rhetoric. But as we know, it’s all about the rhetoric. Reality is unimportant — an inconvenience.

Relatively unbridled capitalism has always the best way out of this, the best way to true social mobility, but our nomenklatura doesn’t want to admit this because it might threaten them and their perquisites. It would blow their cover.

I think it’s already blown. Along with many a second Chakra.

TAKING OBAMA-WORSHIP TO A NEW LEVEL: “The State Is My Shepherd, I Shall Not Want.” Ordinarily I don’t like the term “sheeple,” but when you’re going on about shepherds. . . . Okay, it’s a parody, but with a real basis.

NEIGHBORING STATES POACH JOBS FROM CALIFORNIA. And not just neighbors: “There’s nothing new about governors competing to bring jobs to their state, but rarely has it been this brazen. The Wall Street Journal reports that neighboring states, as well as some states as far flung as Georgia and Tennessee, are stationing official ‘business recruiters’ in California to convince businesses to move their operations out of state.”

Who needs a “business recruiter” to convince people to move their businesses out of state, when you’ve already got Jerry Brown and the California Legislature? . . . .

BRANDING AND the psychology of color.

WHAT’S UP NEXT for Pixar.

AT AMAZON, the Blu-Ray Deal Of The Week.

REASON TV: 38 Studios: Curt Schilling’s Crony Capitalism Debacle.