Kinetic Reaction

Ron Paul Highlights - Bloomberg/Washington Post GOP Debate

2011-10-13T19:18:00.001-07:00

Ron Paul: Restore America Now

2011-10-11T08:21:00.000-07:00

A great promotional video for Ron Paul

Rand Paul on Regulations

2011-10-11T07:18:00.000-07:00

Ron Paul at the Fox News / Google Debate

2011-10-11T07:14:00.000-07:00

Ron Paul Highlights - CNN Tea Party Debate

2011-10-11T07:11:00.001-07:00

Ron Paul Reagan Library Debate - All Questions and Answers - September 7, 2011

2011-10-11T07:10:00.001-07:00

Ron Paul: Unwavering Consistency, Unparalleled Foresight

2011-09-06T21:32:00.000-07:00

American Spectator Dead Wrong on Ron Paul

2011-08-26T17:48:00.000-07:00

Ron Paul's Iowa Fox GOP August 11 Debate

2011-08-26T17:46:00.000-07:00

The Philosophy of Liberty: Plunder

2011-06-16T06:50:00.000-07:00

Ron Paul in 6/13/2011 Debate

2011-06-16T06:48:00.000-07:00

Ron Paul highlights in GOP Presidential debate

2011-05-06T08:56:00.000-07:00

Ron Paul as usual defended liberty and the constitution in the first presidential debate in South Carolina. Here are the highlights:

The Great Socialist Misconception

2011-04-27T19:26:00.000-07:00

The logical short-comings of socialism have been known for a long time.

Nearly 200 years ago, the great classical liberal thinker Frédéric Bastiat wrote:

Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.

We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.

His critique still applies today to socialist-leaning individuals.

Bastiat wrote 'The Law', one of the most famous classical liberal works. The Law argues that the only just use of government power is to protect the right of individuals to their person, their liberty, and their property. When governments are used to plunder from one group to give to another, then they because instruments of injustice, rather than providers of it.

'The Law' can be found online here.

The Unintended Consequences Of The Welfare State

2011-04-27T19:22:00.000-07:00

Forbes recently published an excellent article about the immorality of welfare advocacy:

The Unintended Consequences Of The Welfare State
James Otteson,
It is morally wrong to live off of the fruits of others' labor.

The welfare state seems to be corrupting some of our core moral principles.

That wasn't its intention, but if there is one thing we know about government programs, it is that they rarely do what they were intended to do. This moral corruption is eminently on display in the increasingly common, and increasingly loud, protests over cuts in state budgets, and we will soon see it in the looming fight over whether to raise the federal debt ceiling. (continued..) source

The Great Islamophobic Crusade

2011-04-19T15:06:00.000-07:00

For a small but significant portion of the American population, there is no issue of greater importance than the threat of Islam. Not a debt that threatens to bankrupt the country, nuclear armed adversaries that could in theory kill hundreds of millions of people, or special interests in control of Washington DC. Such an assessment is clearly based on an enormous exaggeration of the strength of Muslim extremists, and at first it might seem inexplicable how it could become so widespread.

This article explains that a dedicated effort by far right Israeli/Jewish extremists is pushing the anti-Islamic sentiment, in order to coopt Americans to their cause:

The Great Islamophobic Crusade

Nine years after 9/11, hysteria about Muslims in American life has gripped the country.

With it has gone an outburst of arson attacks on mosques, campaigns to stop their construction, and the branding of the Muslim-American community, overwhelmingly moderate, as a hotbed of potential terrorist recruits. The frenzy has raged from rural Tennessee to New York City, while in Oklahoma, voters even overwhelmingly approved a ballot measure banning the implementation of Sharia law in American courts (not that such a prospect existed). This campaign of Islamophobia wounded President Obama politically, as one out of five Americans have bought into a sustained chorus of false rumors about his secret Muslim faith. And it may have tainted views of Muslims in general; an August 2010 Pew Research Center poll revealed that, among Americans, the favorability rating of Muslims had dropped by 11 points since 2005.

Erupting so many years after the September 11th trauma, this spasm of anti-Muslim bigotry might seem oddly timed and unexpectedly spontaneous. But think again: it's the fruit of an organized, long-term campaign by a tight confederation of right-wing activists and operatives who first focused on Islamophobia soon after the September 11th attacks, but only attained critical mass during the Obama era. It was then that embittered conservative forces, voted out of power in 2008, sought with remarkable success to leverage cultural resentment into political and partisan gain.

This network is obsessively fixated on the supposed spread of Muslim influence in America. Its apparatus spans continents, extending from Tea Party activists here to the European far right. It brings together in common cause right-wing ultra-Zionists, Christian evangelicals, and racist British soccer hooligans. It reflects an aggressively pro-Israel sensibility, with its key figures venerating the Jewish state as a Middle Eastern Fort Apache on the front lines of the Global War on Terror and urging the U.S. and various European powers to emulate its heavy-handed methods.

[continued..]

Rand Paul Introduces Five-Year Balanced Budget Plan

2011-04-11T07:27:00.000-07:00

On March 17th 2011, Rand Paul introduced a plan to balance the budget in 5 years:

Soviet Defector Explains How the KGB Demoralized Nations by Spreading New-Age Ideals

2011-03-03T20:50:00.000-08:00

Fox Blatantly Doctors Ron Paul Victory Announcement Footage

2011-02-15T17:17:00.000-08:00

Fox has apparently used footage from Ron Paul's 2010 CPAC victory and claimed it is what happened in Ron Paul's 2011 CPAC victory. Get the word out and embarrass Fox.

Venn Diagram of Jesus, Democrats, and Communists

2011-02-13T19:24:00.000-08:00

Ron Paul at CPAC 2011

2011-02-11T19:50:00.001-08:00

Another great speech by Ron Paul

Wikileaks is a Power Shift from the Elite to the Masses but Also Reduces Government Efficacy

2010-12-02T13:10:00.001-08:00

The Wikileaks release of 250,000 secret cables exposes the dealings of the world's most powerful people, and in the processs shift power to the masses. The institutions of government grant the political elite and the administrators of said institutions enormous powers through government privileges like secrecy and immunity to privacy laws, as well as the public resources at their disposal.

This political and bureaucratic elite have guarded these privileges jealously, and only with an involuntary leak could the world have learned of how they are used. With this knowledge the masses who form the power base of the governmental/political elite are better able to negotiate and manage their supposed representatives, and ensure they are working for their interests and not their own.

The information in the leaks also reveals to the masses the large strategies in play and tactics used by the various politically connected factions. This expose has the effect of reducing the disparity between the smaller players in the world and those who have attained political power.

The downside to the Wikileaks release is that short term considerations of how a particular action will play to the public will cloud political decisions. With political criticism now an ever present possibility in the minds of government officials, their actions could end up being conducted in a manner primarily motivated by a desire to minimize political risks to themselves.

In some ways, the weakness of democracy, which is that the government is more intent on re-election than doing what's best for the people, becomes more pronounced when officials do not have any secret channels through which to share their views and administer policies. The risk of this is that government action becomes like the election season campaigning of political candidates, where what is said is not what the candidate really believes will improve the situation for the people, but what they believe will gain them support from a public that largely responds to sound-bites.

Individual Rights by Rand Paul

2010-06-09T23:20:00.000-07:00

Rand Paul responded to the recent manufactured controversy over his Civil Rights comments with the following article in the Bowling Green Daily:

Kundera writes of a balcony scene in the winter snow of 1948 Prague. Clementis offers his fur cap to the new leader Gottwald. Later Clementis is purged by the Communists and airbrushed from all the photos. All that remains of Clementis is the fur cap on Gottwald’s head.

In the end, all that remains of any of us is our reputation. Mine has been sullied over the past week by lies and innuendo.

I’ve spent the past 14 months traveling around the commonwealth, giving more than 400 speeches, and talking to thousands of Kentuckians.

Throughout these speeches, I never once had reason to discuss the Civil Rights Act of 1964, much less call for the repeal of this settled law 46 years later.

So you can imagine my shock when my wife called the day after the election to tell me that Jack Conway was on MSNBC saying - outright lying - claiming that I had called for the repeal of the Civil Rights Act. Even though these lies were evident by watching the video footage, commentators on MSNBC and elsewhere have been repeating it as fact for more than a week now.

If you watch any of my interviews, you’ll see I never stated that I did not support the Civil Rights Act of 1964, and I certainly never called for its repeal.

I was asked if I supported the Civil Rights Act of 1964. I stated that “I like the Civil Rights Act in the sense that it ended discrimination in all public domains, and I’m all in favor of that.” In response, the interviewer asked me about private domains, and I did what typical candidates don’t - I discussed some philosophical issues with government mandating rules on private businesses. I think the federal government has often gone too far in regulating private citizens and businesses.

I made comparisons to the First Amendment and how it allows people in a free society to say things that may be abhorrent, but that is a challenge of a free society. I was speaking abstractly, not to any piece of legislation, since in general my political views are rooted in the rights of the individual over the state.

The interviewer then brought me back to the literal world of life in 1964, saying, “But it’s different with race, because much of the discrimination based on race was codified into law.” In the video you’ll see me agree with her, ending the discussion by saying, “Exactly, it was institutionalized. And that’s why we had to end all institutional racism and I’m completely in favor of that.”

I think that statement is very clear. This did not stop my opponent and the liberal media from implying that I meant the opposite.

I am unlike many folks who run for office. I am an idealist. When I read history I side with abolitionists such as William Lloyd Garrison and Frederick Douglas who fought for 30 years to end slavery and to integrate public transportation in the free North in the 1840s. I see our failure to end slavery for decade after decade as a failure of weak-kneed politicians.

I cheer the abolitionist Lysander Spooner, who argued that slavery was unconstitutional 20 years before the Civil War. I cheer Lerone Bennet when he argues that the right of habeas corpus guaranteed in the Constitution should have derailed slavery long before the Civil War.

Only when the brave idealists, the abolitionists, finally provoked the weak-kneed politicians into action, did the emancipation proclamation come about. Our body politic has enough pragmatists, we need a few idealists.

Segregation ended only after a great and momentous uprising by idealists like Martin Luther King Jr., who provoked weak-kneed politicians to action.

In 2010, there are battles that need to be fought, and they have nothing to do with race or discrimination, but rather the rights of people to be free from a nanny state.

For example, I am opposed to the government telling restaurant owners that they cannot allow smoking in their establishments. I believe we as consumers can choose whether to patronize a smoke-filled restaurant or do business with a smoke-free option.

Think about it - this overreach is now extending to mandates about fat and calorie counts in menus. Do we really need the government managing all of these decisions for us?

My overriding principle is this: I believe in the natural right of all individuals to have their God-given liberty protected. And that’s why I believe the Civil Rights Act was necessary, and that I would have voted for it.

I have long been a fan of what Martin Luther King wrote, “That an unjust law is any code that a numerical majority enforces on a minority but not make binding on itself.”

Now the media is twisting my small government message, making me out to be a crusader for repeal of the Americans for Disabilities Act and The Fair Housing Act. Again, this is patently untrue. I have simply pointed out areas within these broad federal laws that have financially burdened many smaller businesses.

For example, should a small business in a two-story building have to put in a costly elevator, even if it threatens their economic viability? Wouldn’t it be better to allow that business to give a handicapped employee a ground floor office? We need more businesses and jobs, not fewer.

This much is clear: the federal government has overreached in its power grabs. Just look at the national health care schemes, which my opponent supports. Look at the out of control EPA, trying to make law by overreaching regulations that will harm Kentucky coal.

Our country faces a difficult financial future. I see issues not in terms of party but in terms of principles and I will do my very best to deserve the honor that has been bestowed upon me to run for office.

Editor’s note: Rand Paul of Bowling Green is the Republican nominee for U.S. Senate.

Another good article is one in the Wall Street Journal, which points out the hypocrisy and unprofessionalism of the attacks by left-leaning media figures like Salon's Joan Walsh on Rand Paul:

Rand Paul and Civil Rights

A rookie mistake feeds a left-wing smear.

By JAMES TARANTO

Rand Paul was 1 when Congress enacted the Civil Rights Act of 1964. Now 47, he is the Republican nominee for U.S. Senate from Kentucky, his first ever foray into politics. To his evident surprise, the hypothetical question of how he would have voted in 1964 has been drawing a lot of attention.

Politico's Ben Smith characterizes as "evasive" this response Paul gave when asked the question by National Public Radio (we've corrected Smith's transcription errors):

"What I've always said is, I'm opposed to institutional racism, and I would have--if I was alive at the time, I think--had the courage to march with Martin Luther King to overturn institutional racism, and I see no place in our society for institutional racism," he said in response to a first question about the act.

"You would have marched with Martin Luther King but voted with Barry Goldwater?" asked an interviewer.

"I think it's confusing in a lot of cases in what's actually in the Civil Rights Case (sic)," Paul replied. "A lot of things that were actually in the bill I'm actually in favor of. I'm in favor of--everything with regards to ending institutional racism. So I think there's a lot to be desired in the Civil Rights--and indeed the truth is, I haven't read all through it, because it was passed 40 years ago and hadn't been a real pressing issue on the campaign on whether I'm going to vote for the Civil Rights Act."

In an update to his post, Smith notes that it wasn't the first time Paul was asked the question:

Paul articulated his view on the Civil Rights Act in an interview with the editorial board of the Louisville Courier-Journal. . . .

Paul explained that he backed the portion of the Civil Rights Act banning discrimination in public places and institutions, but that he thinks private businesses should be permitted to discriminate by race.

"I like the Civil Rights Act in the sense that it ended discrimination in all public domains, and I'm all in favor of that," he said. "I don't like the idea of telling private business owners. . . ."

Smith is not the only commentator to accuse Paul of being "evasive" or refusing to give a "straight answer." This criticism is absurd. The politically wise answer would have been "yes"--a straight answer in form, but an evasive one in substance. Answering the way he did was a rookie mistake--or, to put it more charitably, a demonstration that Paul is not a professional politician.

Taken at face value, the question itself--How would you have voted if you had been in the Senate as an infant?--is silly. It is a reasonable question only if it is understood more broadly, as an inquiry into Paul's political philosophy. The question within the question is: How uncompromising are you in your adherence to small-government principles?

Paul gave his answer: Pretty darn uncompromising--uncompromising enough to take a position that is not only politically embarrassing but morally dubious by his own lights, as evidenced by this transcript from the Courier-Journal interview, provided by the left-wing site ThinkProgress.org:

Interviewer: But under your philosophy, it would be OK for Dr. King not to be served at the counter at Woolworths?

Paul: I would not go to that Woolworths, and I would stand up in my community and say that it is abhorrent, um, but, the hard part--and this is the hard part about believing in freedom--is, if you believe in the First Amendment, for example--you have too, for example, most good defenders of the First Amendment will believe in abhorrent groups standing up and saying awful things. . . . It's the same way with other behaviors. In a free society, we will tolerate boorish people, who have abhorrent behavior.

Again, Paul could have given a "straight" answer to the question--a flat "no"--that made clear his personal disapproval of discrimination while evading what was really a question about his political philosophy. Far from being evasive, Paul has shown himself to be both candid and principled to a fault.

We do mean to a fault. In this matter, Paul seems to us to be overly ideological and insufficiently mindful of the contingencies of history. Although we are in accord with his general view that government involvement in private business should be kept to a minimum, in our view the Civil Rights Act's restrictions on private discrimination were necessary in order to break down a culture of inequality that was only partly a matter of oppressive state laws. On the other hand, he seeks merely to be one vote of 100 in the Senate. An ideologically hardheaded libertarian in the Senate surely would do the country more good than harm.

It's possible, though, that Paul's eccentric views on civil rights will harm the Republican Party by feeding the left's claims that America is a racist country and the GOP is a racist party. Certainly that's what Salon's Joan Walsh is hoping. Here are her comments on a Rand interview with MSNBC's Rachel Maddow:

You've got to watch the whole interview. At the end, Paul seemed to understand that he's going to be explaining his benighted civil rights views for a long, long time--but he seemed to blame Maddow. "You bring up something that is really not an issue . . . a red herring, it's a political ploy . . . and that's the way it will be used," he complained at the end of the interview. Whether the Civil Rights Act should have applied to private businesses--"not really an issue," says Tea Party hero Rand Paul.

It's going to become increasingly clear that the Tea Party movement wants to revoke the Great Society, the New Deal and the laws that were the result of the civil rights movement. Paul may be right that his views are "not really an issue" with his Tea Party supporters, although I have to think some of them won't enjoy watching him look like a slippery politician as he fails, over and over, to answer Maddow's questions directly.

When Paul says this "is really not an issue," he is speaking in the present tense. It is quite clear that he means that the Civil Rights Act, which has been the law for nearly 46 years, is politically settled; there is no movement to revoke it. In this, he is correct. Walsh's assertion that this is what the tea-party movement seeks is either a fantasy or a lie.

It's a curious role reversal: Rand Paul is a politician; Joan Walsh is a journalist. He is honest, perhaps too honest for his own good. She is playing the part of the dishonest demagogue.

Big Government destroys Real Democracy

2010-05-11T00:48:00.000-07:00

There is a common misconception that more government control of the economy leads to more democratic control. Leftists like MIT linguist and lifelong socialist Noam Chomsky often make this claim while criticizing private corporations as "totalitarian", due to their top down control management style where the shareholders have absolute say and the workers none. Both of these are faulty precepts.

Let us break each argument down and evaluate their merits. The idea that bigger government leads to more democratic control springs from the fact that governments are democratically managed, and therefore when they control resources, those resources become democratically managed as well. This is true at a theoretical level, but in practice governments are controlled by a political elite, and the electorate is generally ignorant about the issues being decided on, let alone participating in the decision making.

A large government empowers those closest to the political decision makers, and allows them to circumvent the most democratic of all forums: courts of law. Courts of law are where the people make decisions based on what they believe is just. In courts, the people who make up the jury are armed with all the facts of the case, and are given the time to study them and the complete power to make a decision on it.

With legislation, the politically connect can insulate themselves from the decision of courts. They can change the terms of contracts, re-allocate the wealth of society, and dictate the actions of individuals, all without having to convince any court of law.

As far as the second argument: that corporations are totalitarian, it is simply empty rhetoric as it ignores the defining quality of totalitarianism: government control of all aspects of society. A corporation alone has no governmental powers to impose its will.

There is a fundamental difference in the exercise of government power compared to other forms of power. Government power supersedes the will of courts and as such can ignore the protections granted to people by common law (which is essentially the law as created by the most democratic of institutions, courts).

It is ironic that those who call for big government in the name of increasing democratic control and fighting totalitarianism, are in fact doing the opposite by diminishing the role of courts and increasing the power of the only organization capable of exerting totalitarian controls.

Palin's criticism of Obama undermines US security

2010-04-18T20:43:00.000-07:00

Sarah Palin's public criticisms of the Obama administration for taking a critical stance on Israel's controversial announcement of new settlement construction undermine US national security.

Israel announced new settlement construction in East Jerusalem, a move which violates the road map for peace, before a visit by Vice President Joe Biden to Israel intended to jump start peace talks between the Palestinian Authority and Israel. This was widely seen as a snub to the US, and eliminated any possibility of the US initiative producing any results.

A major American opposition figure, like Sarah Palin, taking the side of a foreign nation, after it insults the US president and sabotages a major American foreign policy initiative, creates a perception of American political disunity and weakens American credibility as it tries to pressure Israel into making a necessary stop to its settlement building activity.

Given the level of US military involvement in the middle east, and how much the Israeli-Palestinian conflict contributes to tensions in the middle east, peace between Israel and Palestine is a vital US national security interest, as affirmed by General David Petraeus, head of US Central Command. Palin's repeated attacks on Obama for justifiably reacting harshly to Israel's derailment of the peace initiative are inexcusable for a figure who aspires to be a major player in American politics.

The best US foreign policy would be military disengagement from the middle east, as Ron Paul proposes, but barring that, it is essential that American political figures not undermine American efforts to create lasting peace in the region, for the sake of scoring points with America's powerful Israel lobby.

The attachment to a foreign nation, which motivates this kind of political behavior from Sarah Palin and her supporters, is something George Washington warned about:

So likewise, a passionate attachment of one nation for another produces a variety of evils. Sympathy for the favorite nation, facilitating the illusion of an imaginary common interest in cases where no real common interest exists, and infusing into one the enmities of the other, betrays the former into a participation in the quarrels and wars of the latter without adequate inducement or justification. It leads also to concessions to the favorite nation of privileges denied to others which is apt doubly to injure the nation making the concessions; by unnecessarily parting with what ought to have been retained, and by exciting jealousy, ill-will, and a disposition to retaliate, in the parties from whom equal privileges are withheld. And it gives to ambitious, corrupted, or deluded citizens (who devote themselves to the favorite nation), facility to betray or sacrifice the interests of their own country, without odium, sometimes even with popularity; gilding, with the appearances of a virtuous sense of obligation, a commendable deference for public opinion, or a laudable zeal for public good, the base or foolish compliances of ambition, corruption, or infatuation.

As avenues to foreign influence in innumerable ways, such attachments are particularly alarming to the truly enlightened and independent patriot. How many opportunities do they afford to tamper with domestic factions, to practice the arts of seduction, to mislead public opinion, to influence or awe the public councils. Such an attachment of a small or weak towards a great and powerful nation dooms the former to be the satellite of the latter.

Against the insidious wiles of foreign influence (I conjure you to believe me, fellow-citizens) the jealousy of a free people ought to be constantly awake, since history and experience prove that foreign influence is one of the most baneful foes of republican government. But that jealousy to be useful must be impartial; else it becomes the instrument of the very influence to be avoided, instead of a defense against it. Excessive partiality for one foreign nation and excessive dislike of another cause those whom they actuate to see danger only on one side, and serve to veil and even second the arts of influence on the other. Real patriots who may resist the intrigues of the favorite are liable to become suspected and odious, while its tools and dupes usurp the applause and confidence of the people, to surrender their interests.

The great rule of conduct for us in regard to foreign nations is in extending our commercial relations, to have with them as little political connection as possible. So far as we have already formed engagements, let them be fulfilled with perfect good faith. Here let us stop. Europe has a set of primary interests which to us have none; or a very remote relation. Hence she must be engaged in frequent controversies, the causes of which are essentially foreign to our concerns. Hence, therefore, it must be unwise in us to implicate ourselves by artificial ties in the ordinary vicissitudes of her politics, or the ordinary combinations and collisions of her friendships or enmities.

Washington's Farewell Address 1796

Joe Biden's 'Entitlement' Comment is Wrong

2010-03-31T05:08:00.000-07:00

In a recent interview, Joe Biden rebuffed claims that the Democrats' policies were redistributive by stating:

"It's a simple proposition to us: Everyone is entitled to adequate medical health care," Biden says. "If you call that a 'redistribution of income' -- well, so be it. I don't call it that. I call it just being fair."

source

Joe Biden is wrong. No one is entitled to health care. People are only entitled to that which they produce themselves. They are not entitled to something others need to provide or buy for them. No one is entitled to the pay check or labor of a perfect stranger.

Joe Biden's comment reflects the faulty precept of socialism, which expresses itself in the modern liberal/social-democrat political school of thought.

Clinton stands up to right-wing Israeli lobby

2010-03-12T14:36:00.000-08:00

The Israeli right has long been accustomed to doing what it wants, irrespective of past agreements and international law, without any consequences, but Clinton, along with the UN, EU and Russia, recently condemned Israel for its construction of 1600 homes in the Palestinian sector of Jerusalem.

From the VOA:

Clinton Vents 'Frustration' Over Israeli Jerusalem Move in Call to Netanyahu

The State Department says Secretary of State Hillary Clinton telephoned Israeli Prime Minister Benjamin Netanyahu Friday to reiterate deep U.S. concern over an announcement this week that Israel will build more housing in East Jerusalem. The action coincided with an Israel visit by Vice President Joe Biden.

In one of the strongest U.S. protests of Israeli conduct in recent years, the State Department says Clinton told the Israeli leader that the housing move undermined both trust and confidence in the peace process, and American interests in the Middle East.

The telephone conversation, initiated by Clinton, was a follow-up to previous U.S. complaints about Israel's announcement Tuesday that it will build 1,600 new Jewish housing units in predominately-Arab East Jerusalem.

The announcement was an embarrassment to Vice President Biden, who had just begun a visit to Israel, and it threatened to torpedo a U.S.-brokered tentative agreement under which Israel and the Palestinians would resume indirect peace talks.

Prime Minister Netanyahu later expressed regret over the timing of the announcement but gave no indication it will be rescinded.

State Department Spokesman P.J. Crowley said Clinton, in her call, reiterated strong U.S. objections about both the timing and substance of the Israeli action.

He said the United States views it as a "deeply negative signal" about Israel's approach to bilateral relations, and counter to the spirit of the Biden trip. "The Secretary said she could not understand how this happened, particularly in light of the United States' strong commitment to Israel's security. And she made clear that the Israeli government needed to demonstrate not just through words, but through specific actions, that they are committed to this relationship and to the peace process," he said.

Asked if Clinton had expressed anger in her comments to Mr. Netanyahu, a senior U.S. official who spoke to reporters said "frustration would be a better term."

The Israeli decision to build more housing in East Jerusalem, which Palestinians hope to make the capital of a future state, prompted Arab calls for Palestinians to back out of their agreement have so-called "proximity" peace talks with Israel.

It prompted an intensive round of U.S. telephone diplomacy to try to save the agreement brokered by U.S. Middle East envoy George Mitchell.

Crowley said Mitchell and Assistant Secretary of State for Near Eastern Affairs Jeffrey Feltman since Thursday have called, among others, Palestinian President Mahmoud Abbas, Arab League Secretary-General Amr Moussa, and the foreign ministers of Egypt, Jordan, Qatar and the United Arab Emirates.

Officials said Mitchell still intends to make a visit to the region in the coming days that was to have sealed an agreement on the proximity negotiations.

But they said Mitchell, the former U.S. Senate Majority Leader and Northern Ireland peace negotiator, might first join Secretary Clinton in Moscow next Friday for a meeting of the international "quartet" on the Middle East.

The informal grouping of the United States, Russia, the European Union and the United Nations has been trying to expedite negotiations based on among other things the "road map" to regional peace it issued in 2003.

New York Times' Frank Rich attacks Ron Paul movement

2010-03-01T02:14:00.001-08:00

Frank Rich, a writer for the New York Times, wrote an article attacking Ron Paul and his supporters a couple of days ago, called The Axis of the Obsessed and Deranged.

In it he laments that the status quo big government Republicans are being replaced by "Glenn Beck, Ron Paul and Sarah Palin".

Frank Rich is worried, because this new type of Republican doesn't just want to make cosmetic changes to the federal government, it wants to completely eliminate every thing in it that he loves and he sees as integral to his ideology:

The Tea Partiers want to eliminate most government agencies, starting with the Fed and the I.R.S., and end spending on entitlement programs. They are not to be confused with the Party of No holding forth in Washington — a party that, after all, is now positioning itself as a defender of Medicare spending. What we are talking about here is the Party of No Government at All.

He then mentions Ron Paul winning the CPAC straw poll, and goes on to quote the far right Israel-firster, Dorothy Rabinowitz, to describe Ron Paul's supporters as "conspiracy theorists, anti-government zealots, 9/11 truthers, and assorted other cadres of the obsessed and deranged."

Dorothy Rabinowitz, a senior member of the Wall Street Journal's editorial board, is one of Israel's fiercest and most pro-war advocates in the American media. She, along with other staff at the Wall Street Journal, have regularly railed against the Ron Paul movement and its position of non-intervention in the middle east. For example Bret Stephens made a series of ridiculous attacks back in February 2008 about Ron Paul in an article called "Ron Paul and Foreign Policy".

Frank Rich, the self-described liberal, is giving credit to an assessment of Ron Paul's supporters by a pro-war Israeli lobbyist, and in the process, demonstrating an absence of principles and judgment. It would require extreme naivete on Frank Rich's part to not realize that Dorothy Rabinowitz has a vested interest in trying to smear Ron Paul and his supporters due to her support for Israel. It's more likely that he realizes this, but does not care, in which case it demonstrates a lack of character. Either way, it does not bode well for his judgment and long term strategic vision.

To him, the idea of cutting back on federal spending that is unsustainable, and returning America to a limited Constitutional model where states, rather than a single all-powerful federal government, make policy, is so intolerable, that he would prefer pro-war neocons who promote a foreign policy for the benefit of a foreign country to be in power.

The most absurd part of Frank Rich's fanatical attachment to the leftist ideology is that the policies he endorses have been demonstrated to cause economic stagnation in historical example after example:

EU : Causes of Growth differentials in Europe

While the rest of the world is booming, Europe lags behind. France, Germany and Italy are stagnating, and so do Denmark, Sweden and Finland. All gained less than 44% prosperity from 1984 to 2004.

"Big government" is the main cause of Europe's weak performance. The oversized Public Sector lacks productivity and the growing bureaucracy is undoing the productivity gains of the Private Sector, eradicating all of its outstanding performance and productiveness.

Any sober analysis of economies around the world reaches the conclusion that less government spending leads to a more rapid rise in prosperity:

Not only is it evident from cross-country comparisons that lower government spending and taxes are better, but in the US itself, there are clear signs that entitlement programs are leading America to complete bankruptcy.

The former Comptroller General, David Walker, has railed that unless America makes severe cuts to Social Security and Medicare, America will be overwhelmed by debt:

A generation has been told that the government would be there to provide them with social security and medical care in their retirement. What will happen to these Americans when the government runs out of money? This is what makes Frank Rich's big government ideology of teaching people to be dependent on government so fundamentally immoral. It gives them a false sense of security that they will be taken care of, thereby discouraging them from preparing for their retirement, and then inevitably fails to deliver on its promises.

How is it that Frank Rich could stay so committed to a policy that is so evidently failing America? Does it never occur to him that maybe it would be better to let each state determine its own economic and social policy, thereby allowing more experimentation in governance, which would lead to better policies being discovered more often? This is essentially what the CEO of Google, Eric Schmidt, advocated in a recent CNN interview:

Google CEO: We can fix Washington

Is Ron Paul's vision of a federal government confined to its Constitutionally defined role, and various states experimenting and creating social programs that make sense for their particular circumstance, that terrifying to him?

When one of the most important writers for the most important paper in the United States demonstrates such little judgment and rational thought process, it just shows what serious trouble the American political system and economy are in.

Google CEO supports Limited Constitutional Government

2010-02-26T03:41:00.000-08:00

In an interview with CNN, Google's CEO Eric Schmidt lays out his vision for what America needs: a smaller federal government and more state power. He believes that experimentation is how new innovations are discovered, and by allowing more policy to be set by states, there will be more experimentation.

Ron Paul debates Keynesian interventionist

2010-01-30T18:43:00.001-08:00

Article comparing free markets to social democracy

2010-01-10T03:59:00.000-08:00

This is a good article that explains why Europe's strategy of high social welfare stifles economic innovation and is a net detriment. Here is an excerpt:

Keeping America's Edge

The United States is in a tough spot. As we dig ourselves out from a serious financial crisis and a deep recession, our very efforts to recover are exacerbating much more fundamental problems that our country has let fester for too long. Beyond our short-term worries, and behind many of today's political debates, lurks the deeper challenge of coming to terms with America's place in the global economic order.

Our strategic situation is shaped by three inescapable realities. First is the inherent conflict between the creative destruction involved in free-market capitalism and the innate human propensity to avoid risk and change. Second is ever-increasing international competition. And third is the growing disparity in behavioral norms and social conditions between the upper and lower income strata of American society.

These realities combine to form a daunting problem. And the task of resolving it turns out not, by and large, to be a matter of foreign policy. Rather, it compels us to consider how we balance economic dynamism and growth against the unity and stability of our society. After all, we must have continuous, rapid technological and business-model innovation to grow our economy fast enough to avoid losing power to those who do not share America's values — and this innovation requires increasingly deregulated markets and fewer restrictions on behavior. But such deregulation would cause significant displacement and disruption that could seriously undermine America's social cohesion — which is not only essential to a decent and just society, but also to producing the kind of skilled and responsible citizens that free markets ultimately require. Moreover, preserving the integrity of our social fabric by minimizing the divisions that can rend society often requires government policies — to reduce inequality or ensure access to jobs, education, housing, or health care — that can in turn undercut growth and prosperity. Neither innovation nor cohesion can do without the other, but neither, it seems, can avoid undermining the other.

Judge Andrew Napolitano on Glenn Beck Show

2010-01-10T03:56:00.001-08:00

Great show with guest host Judge Andrew Napolitano:

The Ultimate Argument Against Socialism

2009-12-02T20:23:00.000-08:00

David Hume gave a good explanation for why socialism is a bad idea 250 years ago:

An Enquiry Concerning the Principles of Morals:

But historians, and even common sense, may inform us, that, however specious these ideas of PERFECT equality may seem, they are really, at bottom, IMPRACTICABLE; and were they not so, would be extremely PERNICIOUS to human society. Render possessions ever so equal, men's different degrees of art, care, and industry will immediately break that equality. Or if you check these virtues, you reduce society to the most extreme indigence; and instead of preventing want and beggary in a few, render it unavoidable to the whole community. The most rigorous inquisition too is requisite to watch every inequality on its first appearance; and the most severe jurisdiction, to punish and redress it. But besides, that so much authority must soon degenerate into tyranny, and be exerted with great partialities; who can possibly be possessed of it, in such a situation as is here supposed? Perfect equality of possessions, destroying all subordination, weakens extremely the authority of magistracy, and must reduce all power nearly to a level, as well as property.

We may conclude, therefore, that, in order to establish laws for the regulation of property, we must be acquainted with the nature and situation of man; must reject appearances, which may be false, though specious; and must search for those rules, which are, on the whole, most USEFUL and BENEFICIAL. Vulgar sense and slight experience are sufficient for this purpose; where men give not way to too selfish avidity, or too extensive enthusiasm.

Who sees not, for instance, that whatever is produced or improved by a man's art or industry ought, for ever, to be secured to him, in order to give encouragement to such USEFUL habits and accomplishments? That the property ought also to descend to children and relations, for the same USEFUL purpose? That it may be alienated by consent, in order to beget that commerce and intercourse, which is so BENEFICIAL to human society? And that all contracts and promises ought carefully to be fulfilled, in order to secure mutual trust and confidence, by which the general INTEREST of mankind is so much promoted?

Examine the writers on the laws of nature; and you will always find, that, whatever principles they set out with, they are sure to terminate here at last, and to assign, as the ultimate reason for every rule which they establish, the convenience and necessities of mankind.

Ron Paul on Montel Williams

2009-11-29T23:35:00.000-08:00

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Ron Paul on CNBC responding to questions on Fed Audit

2009-11-27T07:50:00.001-08:00

Ron Paul explains why Fed transparency is necessary:

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An Open Letter to the Federal Reserve

2009-11-27T07:44:00.001-08:00

Great article, via Fool.com:

An Open Letter to the Federal Reserve

By Matt Koppenheffer and Morgan Housel

Dear Ben Bernanke and distinguished members of the Federal Reserve:

We are writing today to formally solicit your help in obtaining approvals to start a new bank holding company, Money Unlimited. We of course understand that the approval process for a new bank is typically done through the FDIC, but as the Federal Reserve plays a crucial role in our business plan, we hope that you can expedite the process.

First, let us assure you that we will start from day one as a very well capitalized institution, with no need to raise outside capital. While actual cash is on the lower end of the spectrum, we both own stock portfolios that we plan to use as collateral for our banking operations. Our current holdings include Berkshire Hathaway (NYSE: BRK-B), Johnson & Johnson (NYSE: JNJ), Procter & Gamble (NYSE: PG), and Coca-Cola (NYSE: KO).

For the purposes of this application, we are choosing to mark these assets to model rather than to market. Our basic assumptions include 7% U.S. GDP growth, 12% global GDP growth, a 4% U.S. unemployment rate, rising corporate profitability, U.S. debt repudiation, and the end of cloudy days.

In addition, Matt owns a home in Las Vegas. Though this asset is currently considered "under water" based on market valuations, a house down the street just sold for slightly more than Zillow.com said it was worth. We extrapolated that gain into infinity and determined the housing bust is simply a figment of the media's imagination.

Now the good news: Without getting into the complexities, our models show our combined net worths at just over $1 billion, all of which we'll use as capital for Money Unlimited. We hired a 22-year-old right out of college who's pretty darn good with Excel. He assures us it's a conservative figure.

While neither of us has any "formal" banking experience, our time-tested business model more than compensates for this apparent shortfall. As with Goldman Sachs (NYSE: GS), which was recently made a bank holding company, we have no plans to engage in actual banking operations such as deposit-taking and lending. That stuff just sounds hard. Regulators are always all, "You need to lend money to people who can pay you back." We'd rather just avoid that whole sticky situation altogether.

Instead, we're going to leverage our borrowings from the Federal Reserve to create a massive, money-spewing trading operation.

It's quite simple, really. We're going to borrow money from the Federal Reserve at 0%, then lend it back out to the U.S. Treasury at 3%. The Treasury can then use that money for fantastic programs like Cash for Clunkers. If we leverage our $1 billion asset base 20-to-1, we'll pull in $600 million in year one without breaking a sweat.

Because we want to do what's right for the economy, we plan to keep operating expenses to a bare minimum and limit our bonuses to $20 million each for the first five years. By plowing the remaining money back into the bank -- and, of course, leveraging it at 20-times -- we'll be able to grow like a weed. Assuming you folks at the Federal Reserve continue to do your part by lending money at 0%, we expect to clear $120 billion in assets in five years flat.

And don't worry about us. We understand that hard work and tangible economic contributions need to be rewarded, so in the sixth year of operation we both plan to take $500 million bonuses and use company money to buy ourselves private jets.

Money Unlimited will offer other significant benefits to the economy as well. We'll compete against banking organizations such as Goldman Sachs, JPMorgan Chase (NYSE: JPM), and Citigroup (NYSE: C), who are no doubt engaging in similar practices. (Have you seen their earnings?) Plus, we'll allow other banks to buy credit defaults swaps against us. As any financial professional worth his salt can tell you, this "increases liquidity" and helps small businesses. We can't tell you exactly how that works, but salesmen who wear shiny cuff links and talk really fast tell us it's true.

But helping the economy isn't all we're about. As Goldman Sachs' CEO Lloyd Blankfein recently put it, this is "God's work," and we certainly don't disagree with that.

Before long, the founders of Money Unlimited expect our trading operations will become so large that we will be considered "too big to fail." While some may consider this a concern, we disagree. There should be more competition among "too big to fail" institutions so that the risk of a Chernobyl-type catastrophe in our financial system is spread more broadly.

Thank you for your time and we look forward to your help obtaining a speedy approval for Money Unlimited.

Sincerely,
Matt Koppenheffer and Morgan Housel

Everything the Government Runs is Broke

2009-08-31T10:42:00.000-07:00

07/15/2009 Freedom Watch w/ Ron Paul, G. Edward Griffin, Peter Schiff, et al.

2009-07-25T07:47:00.000-07:00

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07/08/2009 Freedom Watch w/ Ron Paul, Jim DeMint, Rand Paul, et al.

2009-07-25T07:41:00.000-07:00

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07/01/2009 Freedom Watch w/ Ron Paul, John McManus, Mary Ruwart, David Bruckner, et al.

2009-07-25T07:35:00.000-07:00

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06/24/2009 Freedom Watch w/ Ron Paul, Lew Rockwell, Gary Johnson, David Boaz, et al.

2009-07-25T07:28:00.000-07:00

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06/17/2009 Freedom Watch w/ Ron Paul, Peter Schiff, Tom Woods, Lew Rockwell, et al.

2009-07-25T07:22:00.000-07:00

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06/10/2009 Freedom Watch w/ Ron Paul, Dan Hannan, John Stossel, Nick Gillespie, et al.

2009-07-25T07:12:00.000-07:00

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06/03/2009 Freedom Watch w/ Ron Paul, Daniel Hannan, Lew Rockwell, Tom Woods, et al.

2009-07-25T07:05:00.000-07:00

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05/27/2009 Freedom Watch w/ Ron Paul, Tom Woods, Wayne Allyn Root, Schiff, Sam Dodson, et al.

2009-07-25T05:02:00.000-07:00

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Affirmative Action Groups will destroy America

2009-07-11T09:25:00.000-07:00

As we enter the worst financial crisis in 80 years, almost none of the root causes of the crisis are being addressed, while the election of Obama has underlined the immunity that the groups behind the crisis will continue to enjoy.

The primary causes of the financial crisis have been:

1) affirmative action policies to increase mortgages issued for low income individuals

These policies include the Community Reinvestment Act, affirmative action mandates by Fannie Mae and Freddie Mac, and HUD.

As this article in the City Journal -a leading urban-policy magazine- on the Community Reinvestment Act explains, these affirmative action policies arose out of the observation by civil rights activists that banks were not lending in low income communities, communities that were often predominantly black/hispanic:

source

The Act, which Jimmy Carter signed in 1977, grew out of the complaint that urban banks were "redlining" inner-city neighborhoods, refusing to lend to their residents while using their deposits to finance suburban expansion. CRA decreed that banks have "an affirmative obligation" to meet the credit needs of the communities in which they are chartered, and that federal banking regulators should assess how well they do that when considering their requests to merge or to open branches. Implicit in the bill's rationale was a belief that CRA was needed to counter racial discrimination in lending, an assumption that later seemed to gain support from a widely publicized 1990 Federal Reserve Bank of Boston finding that blacks and Hispanics suffered higher mortgage-denial rates than whites, even at similar income levels.

The reason behind these lending practices was later found to be fully explainable by credit-worthiness considerations, rather than any insidious racial discrimination:

A September 1999 study by Freddie Mac, for instance, confirmed what previous Federal Reserve and Federal Deposit Insurance Corporation studies had found: that African-Americans have disproportionate levels of credit problems, which explains why they have a harder time qualifying for mortgage money. As Freddie Mac found, blacks with incomes of $65,000 to $75,000 a year have on average worse credit records than whites making under $25,000.

The Federal Reserve Bank of Dallas had it right when it said —in a paper pointedly entitled "Red Lining or Red Herring?"— the CRA may not be needed in today's financial environment to ensure all segments of our economy enjoy access to credit." True, some household —those with a history of credit problems, for instance, or those buying homes in neighborhoods where re-selling them might be difficult— may not qualify for loans at all, and some may have to pay higher interest rates, in reflection of higher risk. But higher rates in such situations are balanced by lower house prices. This is not a conspiracy against the poor; it's how markets measure risk and work to make credit available.

Nonetheless, affirmative action activist groups seized on the political argument of discrimination, and with the aid of Clinton's 1995 provisions to the CRA, an industry was born around extorting banks into lending in low income communities:

The Clinton administration's get-tough regulatory regime mattered so crucially because bank deregulation had set off a wave of mega-mergers, including the acquisition of the Bank of America by NationsBank, BankBoston by Fleet Financial, and Bankers Trust by Deutsche Bank. Regulatory approval of such mergers depended, in part, on positive CRA ratings. "To avoid the possibility of a denied or delayed application," advises the NCRC in its deadpan tone, "lending institutions have an incentive to make formal agreements with community organizations." By intervening —even just threatening to intervene— in the CRA review process, left-wing nonprofit groups have been able to gain control over eye-popping pools of bank capital, which they in turn parcel out to individual low-income mortgage seekers. A radical group called ACORN Housing has a $760 million commitment from the Bank of New York; the Boston-based Neighborhood Assistance Corporation of America has a $3-billion agreement with the Bank of America; a coalition of groups headed by New Jersey Citizen Action has a five-year, $13-billion agreement with First Union Corporation. Similar deals operate in almost every major U.S. city. Observes Tom Callahnan, executive director of the Massachusetts Affordable Housing Alliance, which has $220 million in bank mortgage money to parcel out, "CRA is the backbone of everything we do."

These activist groups are deeply entrenched in the political world of Washington, with the current president having a long history of working in the civil rights/ minority empowerment activism industry:

wikipedia

he also joined Davis, Miner, Barnhill & Galland, a twelve-attorney law firm specializing in civil rights litigation and neighborhood economic development, where he was an associate from 1993 to 1996, then of counsel from 1996 to 2004, with his law license becoming inactive in 2002.[28][44][45]

Obama was a founding member of the board of directors of Public Allies in 1992, resigning before his wife, Michelle, became the founding executive director of Public Allies Chicago in early 1993.[28][46] He served from 1994 to 2002 on the board of directors of the Woods Fund of Chicago, which in 1985 had been the first foundation to fund the Developing Communities Project

Obama even represented a group suing Citibank for discriminating against minority applicants in its lending practices in 1994:

source

Case Name
Buycks-Roberson v. Citibank Fed. Sav. Bank Fair Housing/Lending/Insurance
Docket / Court 94 C 4094 ( N.D. Ill. ) FH-IL-0011
State/Territory Illinois
Case Summary
Plaintiffs filed their class action lawsuit on July 6, 1994, alleging that Citibank had engaged in redlining practices in the Chicago metropolitan area in violation of the Equal Credit Opportunity Act (ECOA), 15 U.S.C. 1691; the Fair Housing Act, 42 U.S.C. 3601-3619; the Thirteenth Amendment to the U.S. Constitution; and 42 U.S.C. 1981, 1982. Plaintiffs alleged that the Defendant-bank rejected loan applications of minority applicants while approving loan applications filed by white applicants with similar financial characteristics and credit histories. Plaintiffs sought injunctive relief, actual damages, and punitive damages.

***

Barack H. Obama
Davis, Miner, Barnhill and Galland, P.C.

Fannie Mae and Freddie Mac are the other major affirmative programs contributing to America's economic problems. They are government sponsored enterprises that spend amounts lobbying politicians, particularly Democrats.

They are massive organizations that own or guarantee half of the $12 trillion worth of mortgages in the US. In 1999, under intense pressure from the Clinton administration, they began a program to increase home ownership in the minority and low income demographics, a program which precipitated the sub-prime mortgage bubble:

source

Fannie Mae Eases Credit To Aid Mortgage Lending
By STEVEN A. HOLMES
Published: Thursday, September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

The Democrats' intense dedication to these organizations meant that efforts to regulate their activities and impose responsible lending standards on them were blocked repeatedly, especially by black pro-affirmative-action Democrats in Congress:

How much has Fannie Mae cost the US? Besides the indirect costs like the losses from the financial crisis and the $700 billion bank bailout that the sub-prime mortgages spurred, there is also another $750 billion that the US has paid in the way of the Federal Reserve's purchase of Fannie/Freddie backed mortgages.

Given the Democratic party's history with these affirmative action groups, it's very likely that the Democrats will not confront the problems these groups cause in the economy, and will keep these policies inspired by affirmative action activism in place, as they continue to corrode America's economic competitiveness.

The Democrats will blame every thing else: deregulation in the financial industry, greed on Wall Street, predatory lending practices, etc, but will ignore the root cause, thus the economic problem will be go undiagnosed and untreated.

2) the Federal Reserve

The Federal Reserve's low interest, inflationary monetary policy led to the credit bubble that fed the housing bubble. Coupled with Fannie Mae and Freddie Mac's massive subsidization and securitization of mortgages, housing prices boomed leading to a speculatory spiral of increased borrowing and investment into housing, on the expectation of fast profits on small margins. Like all speculatory bubbles, it eventually came crashing down, taking down the entire financial sector with it.

This isn't the first bubble that the Federal Reserve has helped create, but it is the worst one, because the industry that the Fed's easy credit flowed into was created by affirmative action government mandate, rather than market forces like in the case of the dot com bubble.

In the case of the dot com bubble, there was real economic potential that was being speculated on, and massive new companies like Yahoo, Google and Ebay that arose in the bubble and survived its crash.

People over-estimated the speed at which the internet market would grow, and invested in many companies that were not viable businesses, but not all of the speculation was groundless, and many of the money invested did return value.

The beginning of the housing bubble and the concurrent sub-prime crisis meanwhile can be attributed almost solely to government intervention, motivated by affirmative action policies. The market fundamentals didn't justify vast amounts of wealth being poured into the construction of new houses. There was no explosive economic opportunity being bet on the way the dot com bubble bet on internet technology.

Furthermore, the scale of the intervention of the government in the housing industry made the housing bubble much larger than the dot com bubble. While speculation on intrinsic financial value spurred the dot com bubble, expectations of government giants Freddie and Fannie continuing to pour money into the housing market and push up prices drove speculators to invest far larger sums with more confidence than they did in tech companies.

When the NASDAQ crashed, about $5 trillion dollars was wiped out. The sub-prime crisis on the other hand has already wiped $8 trillion from just the US economy, and the losses and decline are widely expected to continue, with some predictions of a looming ARM (adjustable-rate mortgage) crisis that could parallel the subprime crisis in scale.

Neither political party discusses what role the Federal Reserve's low interest rate policy may have had in creating the bubble, and very little is said about how government intervention in the housing sector may have started the speculatory rise in prices.

Some criticism of Fannie/Freddie has been levied by major Republican politicians, but it has been limited to criticizing the Democrats for their role in blocking efforts to regulate Fannie/Fannie. The only solution offered by the Republican leadership has been to reduce the scope of Fannie/Fannie, rather than dealing with the fundamental problem and abolishing affirmative action policies in housing altogether.

This is not surprising as the Republicans are responsible for pushing for affirmative action policies in housing as well (e.g. Bush's 'ownership society'), and thus can't attack the principle of government intervention in housing without admitting that they too contributed to the problem.

3) neocon foreign policies

The loyal opposition, the Republicans, have been discredited due to their partnership with the Likudnik Israeli right and their Christian Zionist allies. With people afraid of what the AIPAC allied McCain might do if he were elected, many fiscal conservatives actually favored Obama over McCain, despite their disdain for Democratic economic policies.

The Republican elite have allied with the likes of Pastor Hagee, head of "Christians United for Israel", a darling of the Israel lobby, and an advocate of war against Iran. Likewise, Joseph Lieberman became a close ally of McCain's during his campaign, and was one of the leading advocates of war against Iran.

Meanwhile, McCain's advisor, Randy Scheunemann, was a former lobbyist for the Georgian government, and an advocate of bringing Georgia into NATO. As Pat Buchanan points out, had Georgia been a NATO member in its recent conflict with Russia, the US may have had to go to nuclear war with Russia:

source

Who is Randy Scheunemann?

He is the principal foreign policy adviser to John McCain and potential successor to Henry Kissinger and Zbigniew Brzezinski as national security adviser to the president of the United States.

But Randy Scheunemann has another identity, another role.
He is a dual loyalist, a foreign agent whose assignment is to get America committed to spilling the blood of her sons for client regimes who have made this moral mercenary a rich man.

From January 2007 to March 2008, the McCain campaign paid Scheunemann $70,000—pocket change compared to the $290,000 his Orion Strategies banked in those same 15 months from the Georgian regime of Mikheil Saakashvili.
What were Mikheil's marching orders to Tbilisi's man in Washington? Get Georgia a NATO war guarantee. Get America committed to fight Russia, if necessary, on behalf of Georgia.

Scheunemann came close to succeeding.

Had he done so, U.S. soldiers and Marines from Idaho and West Virginia would be killing Russians in the Caucasus, and dying to protect Scheunemannâ€™s client, who launched this idiotic war the night of Aug. 7. That people like Scheunemann hire themselves out to put American lives on the line for their clients is a classic corruption of American democracy.

U.S. backing for his campaign to retrieve his lost provinces is what Saakashvili paid Scheunemann to produce. But why should Americans fight Russians to force 70,000 South Ossetians back into the custody of a regime they detest? Why not let the South Ossetians decide their own future in free elections?
Not only is the folly of the Bush interventionist policy on display in the Caucasus, so, too, is its manifest incoherence.

Defense Secretary Robert Gates says we have sought for 45 years to stay out of a shooting war with Russia and we are not going to get into one now. President Bush assured us there will be no U.S. military response to the Russian move into Georgia.

That is a recognition of, and a bowing to, realityâ€”namely, that Russiaâ€™s control of South Ossetia and Abkhazia and occupation of a strip of Georgia cannot be a casus belli for the United States. We may deplore it, but it cannot justify war with Russia.

If that be true, and it transparently is, what are McCain, Barack Obama, Bush, and German Chancellor Angela Merkel doing committing the United States and Germany to bringing Georgia into NATO? For that would commit us to war for a cause we have already conceded, by our paralysis, does not justify a war.
Not only did Scheunemann's two-man lobbying firm receive $730,000 since 2001 to get Georgia a NATO war guarantee, he was paid by Romania and Latvia to do the same. And he succeeded.

Latvia, a tiny Baltic republic annexed by Joseph Stalin in June 1940 during his pact with Adolf Hitler, was set free at the end of the Cold War. Yet hundreds of thousands of Russians had been moved into Latvia by Stalin, and as Riga served as a base of the Baltic Sea fleet, many Russian naval officers retired there.

The children and grandchildren of these Russians are Latvian citizens. They are a cause of constant tension with ethnic Letts and of strife with Moscow, which has assumed the role of protector of Russians left behind in the "near abroad" when the Soviet Union broke apart.

Thanks to the lobbying of Scheunemann and friends, Latvia has been brought into NATO and given a U.S. war guarantee. If Russia intervenes to halt some nasty ethnic violence in Riga, the United States is committed to come in and drive the Russians out.

With these dynamics at play, the reign of affirmative action groups that leech off the economy seems like a good alternative to a Republican administration. That is the sorry choice America has had to make.

The only bright side to all of this is that with the election of Obama, one of the three root causes of the financial crisis may possibly be addressed; the neocon policy of foreign interventionism. The hope is that the Obama administration can bring peace to the middle east thereby reducing the power of the pro-war Israeli right and its influence over Republican foreign policy.

This would allow the Republicans, with the influence of the Ron Paul core, to re-emerge as a credible party that addresses domestic fiscal policy, rather than one that risks a nuclear war for countries on the other side of the planet.

The Current Advantage of Socialized Health Care

2009-06-27T20:46:00.000-07:00

My debate with Politicsforum.org member, Order, found here, got me thinking about socialized health care and how it differs from private health insurance as it exists today.

Order's argument was that people would prefer the security of having a safety net provided by the government, over the higher probability of being wealthy provided by the free market. I disagreed, and still disagree, but the exercise of defending my position and comparing private vs public insurance led me to see an advantage that a government run health care system has over private health insurance, even though overall, I still see the private health insurance option, i.e. the free market health care option, as superior to the socialized health care option.

Basically, with a government run health care program, you are forced to pay a premium proportional to your income for your whole life, and in turn, you are guaranteed medical coverage for your whole life.

There is no analogous private option, simply because the legal mechanisms don't exist for a person to choose to enter into a life long contract with a private insurance company wherein a percentage of the person's income is taken by the insurance provider every month in exchange for a lifelong guarantee of coverage. For example, whereas the government can do an audit to verify your income, that option doesn't exist for private health insurance companies.

The reason for this is obvious. Society cannot trust private companies with the powers currently enjoyed by government tax collection agencies, and it is unwilling to socialize the cost of auditing individuals to verify contractual commitments of income sharing.

What I am wondering is, does a legal mechanism exist by which private companies could provide what government-run health insurance currently provides: a guarantee of lifelong health coverage in exchange for a percentage a person's income and the broad power to collect it, without the risk of granting private companies dangerous governmental powers, and without imposing a heavy administration cost on government in enforcing compliance with the client - insurance provider contract.

Perhaps one way to do it would be for health insurance providers, after paying a fee to cover the government's administration costs, to be allowed to offer lifelong contracts where their clients' premiums would be incorporated into their individual income tax, so that the government collects the insurance premium for the insurance company. There could also be a small surcharge, for example 2% of the premium, that the government would collect to offset the per unit administration costs.

This is just one quickly thought out proposal. Doubtless there are many other possible routes.

Regardless of the specifics of the program, the idea if proposed would be highly controversial, as in some ways it is similar to indentured servitude, in that a person voluntarily gives up some of their liberty in exchange for material compensation. On a close analysis though, it's not any worse from an individual liberty standpoint than government run socialized health care, and in fact would afford people with at least the option of not opting into a higher-taxation-for-life-in-exchange-for-guaranteed-coverage arrangement, something people living in countries with socialized health care don't have.

05/20/2009 Freedom Watch w/ Rand Paul, Lew Rockwell, Tom Woods, Otto Guevara, et al.

2009-05-24T03:53:00.000-07:00

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Rep. Alan Grayson challenges Fed Inspector General on Trillion Dollar loans

2009-05-17T19:36:00.000-07:00

Ron Paul discusses Austrian vs. Keynesian economics on Morning Joe 05/15/2009

2009-05-17T01:02:00.001-07:00

05/13/2009 Freedom Watch w/ Judge Napolitano, Ron Paul, Peter Schiff, Daniel Hannan, Rockwell, et al.

2009-05-17T00:58:00.001-07:00

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04/29/2009 Freedom Watch w/ Napolitano, Ron Paul, Daniel Hannan, Rockwell, Peter Schiff, et al.

2009-05-17T00:54:00.000-07:00

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04/22/2009 Freedom Watch w/ Napolitano, Shep Smith, Ron Paul, Jim Bovard, et al

2009-05-17T00:51:00.000-07:00

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04/15/2009 Freedom Watch Tax Day w/ Napolitano, Ron Paul, Peter Schiff, Lew Rockwell, Cody Willard et al.

2009-05-17T00:48:00.000-07:00

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04/08/2009 Freedom Watch w/ Napolitano, Daniel Hannan, Peter Schiff, Lew Rockwell, et al.

2009-05-17T00:45:00.001-07:00

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04/01/2009 Freedom Watch w/ Napolitano, John Stossel, Celente, Tom Woods, Ron Paul et al

2009-05-17T00:42:00.000-07:00

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03/25/2009 Freedom Watch w/ Napolitano: Glenn Beck, Ron Paul, Shep Smith, Lew Rockwell, et al

2009-05-17T00:26:00.000-07:00

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Judge Andrew Napolitano Monologue on Natural Law and Contract Protection

2009-05-17T00:23:00.000-07:00

03/18/2009 Freedom Watch w/ Judge Napolitano, Ron Paul, Peter Schiff, Alex Jones, et al.

2009-05-17T00:18:00.000-07:00

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03/11/2009 Freedom Watch w/ Judge Napolitano, Ron Paul, Lew Rockwell, John Stossel

2009-05-17T00:06:00.000-07:00

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Rand Paul Announces his Candidacy

2009-05-16T23:32:00.000-07:00

Visit msnbc.com for Breaking News, World News, and News about the Economy

Obama Administration Announces Unprecedented Gesture of Generosity

2009-04-03T17:59:00.000-07:00

The Obama administration has declared an end to tax payer bailouts of struggling corporations and in a historic move, has declared that the staff will use their own money to save GM. This is truly remarkable, and shows the generous and selfless nature of the Obama administration staff.

Don Boudreaux from Cafe Hayek has more:

Here's a letter that I sent earlier this week to Barack Obama:
30 March 2009

Mr. Barack Obama
President, Executive Branch
United States Government
Washington, DC

Dear Mr. Obama:

On your website today you write that "my administration will offer General Motors adequate working capital to continue operations for the next 60 days." Because you're a man of your word and you choose your words carefully, I trust that you mean here that you and the public servants in your administration will personally pony up the working capital for G.M.

That is, like, soooo cool!!

I'm psyched that an American president and his administration finally will help a struggling company by digging into their own pockets! Thank you, thank you, thank you for breaking with the capitalist/GOP/"free-market-fundamentalist" tradition of forcing me and other taxpayers to shovel money into the bank accounts of giant multinational corporations. Thanks for risking only wealth that is your own, rather than following the prescription of lazy-fairies like Milton Friedman who (I learned in my sociology classes and from reading Naomi Klein) believed that innocent taxpayers should be forced to serve Big Multinational Corporations.

I'm so inspired that you and your White House teammates will give G.M. the bucks it needs - give them from your own private funds rather than take them from from taxpayers! That's just, like, so progressive! What a change! I believe in it!

Sincerely,
Donald J. Boudreaux

How Regulations killed American entrepreneurship

2009-03-29T08:04:00.000-07:00

The Sarbanes-Oxley Act of 2002 has devastated new business creation in the United States.

The Wall Street Journal notes:

According to the National Venture Capital Association, in all of 2008 there have been just six companies that have gone public. Compare that with 269 IPOs in 1999, 272 in 1996, and 365 in 1986. Faced with crushing reporting costs if they go public, new companies are instead selling themselves to big, existing corporations. For the last four years it has seemed that every new business plan in Silicon Valley has ended with the statement 'And then we sell to Google.' The venture capital industry is now underwater, paying out less than it is taking in. Small potential shareholders are denied access to future gains. Power is being ever more centralized in big, established companies. For all of this, we can first thank Sarbanes-Oxley. Cooked up in the wake of accounting scandals earlier this decade, it has essentially killed the creation of new public companies in America, hamstrung the NYSE and Nasdaq (while making the London Stock Exchange rich), and cost U.S. industry more than $200 billion by some estimates.
source

An advisory committee to the SEC found that:

beyond the aggregate costs involved with Section 404 compliance, costs in relation to revenue have been disproportionately borne by smaller public companies. The lack of proportionality of the cost and amount of resources devoted to Section 404 compliance for smaller public companies is evidenced by data which shows that the expected cost of Section 404 implementation, as a percentage of revenue, is dramatically higher for smaller public companies than it is for larger public companies.
source

The committee found that compliance with Sarbanes-Oxley costs small companies, defined as those with a market capitalization of less than $100 million, an average of 2.55% of revenues. For large companies on the other hand, compliance only costs an average of 0.06% of revenues.

That's a 42.5 times greater relative cost that this regulation imposes on small companies versus large ones.

The situation is absolutely intolerable and needs to be reformed, given how important new business creation is for the US economy. Many of the most dynamic companies today, companies like Google, Ebay, and Yahoo, began in the last 10-15 years. How many future Googles and Ebays has Sarbanes-Oxley prevented from emerging? How many jobs and billions in revenues have been lost to this misguided intervention in the financial sector?

As Ron Paul pointed out following the Madoff scandal, the idea of regulating away financial scandals with regulations enforced by an SEC cannot work, and only imposes more costs on the US economy:

Administration "open-minded" about GM bailout

2009-03-17T05:35:00.000-07:00

Forget the Constitution, forget the enumerated powers of the federal government, when it comes to the economy, the Obama administration is "open-minded" about the prospect of using tax payer dollars to bailout GM and Chrysler. From Bloomberg:

Task Force Open to Auto Aid, Avoiding Bankruptcy, Rattner Says

By John Hughes

March 17 (Bloomberg) -- The Obama administration is “open minded” about giving General Motors Corp. and Chrysler LLC more aid and will use “all the resources” of the federal government to avoid bankruptcy for the automakers, said Steven Rattner, chief adviser to the U.S. Treasury’s autos task force.

U.S. auto suppliers may get some aid, and the task force plans to meet a March 31 deadline for assessing GM and Chrysler viability, Rattner said yesterday in an interview. “We are open minded about committing additional resources to ensuring a viable domestic car industry,” he said.

source

Gone are the days when politicians looked upon the Constitution as their rulebook, and with a sense of duty to their Constituents, strove to limit the power of the federal government in the spirit of Constitutional Republicanism.

There is now no limit to what the politicians will consider as a justifiable exercise of power by the federal government. The federal government of the United States is no longer a limited government as setup by the framers of the Constitution. It is an all-powerful central government that decides how much freedom to afford the people. It can interfere and intervene in any sector of the society. The Constitution is merely a relic of a distant past, with no bearing in political decisions.

In times like this, a review of James Madison's quote expounding his fears of an all powerful federal government seems fitting:

"If Congress can employ money indefinitely to the general welfare, and are the sole and supreme judges of the general welfare, they may take the care of religion into their own hands; they may appoint teachers in every State, county and parish and pay them out of their public treasury; they may take into their own hands the education of children, establishing in like manner schools throughout the Union; they may assume the provision of the poor; they may undertake the regulation of all roads other than post-roads; in short, every thing, from the highest object of state legislation down to the most minute object of police, would be thrown under the power of Congress.... Were the power of Congress to be established in the latitude contended for, it would subvert the very foundations, and transmute the very nature of the limited Government established by the people of America."

-James Madison, the father of the Constitution

New Episode of Freedom Watch with Judge Napolitano, Ron Paul et al!

2009-03-06T06:26:00.000-08:00

New episode, with Judge Napolitano, Ron Paul, RAND PAUL, Peter Schiff and Cody Willard!

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Ron Paul video: "What if.."

2009-03-01T18:34:00.001-08:00

All the Constitutionalists on Fox News at once!

2009-02-18T20:04:00.000-08:00

Fox's internet news channel Foxnews.com had all the major pro-Constitution figures on 'Freedom Watch' at once:

Judge Napolitano as host, Peter Schiff, Ron Paul on the phone, and Cody Willard

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Ron Paul on MSNBC Morning Joe 1/27/2009

2009-01-27T19:52:00.000-08:00

Peter Schiff on CNBC Market's Down Day Jan. 20 2009

2009-01-21T03:46:00.000-08:00

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U.S. Economy: The Philosopher's Stone

2008-12-19T01:18:00.000-08:00

Stupid Socialists think Peter Schiff is one of them

2008-12-05T23:37:00.001-08:00

The stupid socialists over at 'Crooks and Liars' are congratulating Peter Schiff on correctly predicting the market crash. John Amato has linked to a video 'Peter Schiff was Right', where Peter's correct predictions on the market crash are shown, and he then goes on to write:

As C&Lers know, I actually watched many of Schiff's appearances on the Conservative-dominated stock shows and indeed all the free-market, screw-the-middle-class blowhards routinely laughed at him as he tried to bring some reality to their petty world. Things were terrible and nothing their cheerleading could do would change any of it ... as we've seen.

What John Amato doesn't understand, when he ridicules the supposedly "free market" guys who laughed at Peter Schiff, is that Peter Schiff is the most free market guy there is. His dad went to prison to protest the income tax. Peter Schiff believes that Obama's socialist policies will further destroy America's economy:

His main criticism of the Bush administration is that it has increased the size of government, and bailed out industries, rather than adhering to the principle of laissez faire and not intervening in the economy. He constantly criticizes America's government policies for being too socialist, as can be seen in the 4:10 mark of this video:

and at the 8:38 mark of this video:

For the socialists at 'Crooks and Liars' to pretend that Peter Schiff is one of them, and make fun of people who believe in the free market -as if Peter Schiff is opposed to the free market, just shows how incredibly ignorant and idiotic they are.

Everything I Want to Do Is Illegal

2008-12-04T00:35:00.000-08:00

Here is a great article showing the flaw of using coercive collectivism (aka socialism aka big government) to manage society:

source

Everything I Want to Do Is Illegal
JOEL SALATIN / Acres v.33, n.9, Sept 2003 1sep03

Everything I want to do is illegal. As if a highly bureaucratic regulatory system was not already in place, 9/11 fueled renewed acceleration to eliminate freedom from the countryside. Every time a letter arrives in the mail from a federal or state agriculture department my heart jumps like I just got sent to the principal’s office.

And it doesn’t stop with agriculture bureaucrats. It includes all sorts of government agencies, from zoning, to taxing, to food inspectors. These agencies are the ultimate extension of a disconnected, Greco-Roman, Western, egocentric, compartmentalized, reductionist, fragmented, linear thought process.

ON-FARM PROCESSING

I want to dress my beef and pork on the farm where I’ve coddled and raised it. But zoning laws prohibit slaughterhouses on agricultural land. For crying out loud, what makes more holistic sense than to put abattoirs where the animals are? But no, in the wisdom of Western disconnected thinking, abattoirs are massive centralized facilities visited daily by a steady stream of tractor trailers and illegal alien workers.

But what about dressing a couple of animals a year in the backyard? How can that be compared to a ConAgra or Tyson facility? In the eyes of the government, the two are one and the same. Every T-bone steak has to be wrapped in a half-million dollar facility so that it can be sold to your neighbor. The fact that I can do it on my own farm more cleanly, more responsibly, more humanely, more efficiently, and in a more environmentally friendly manner doesn’t matter to the government agents who walk around with big badges on their jackets and wheelbarrow-sized regulations tucked under their arms.

OK, so I take my animals and load them onto a trailer for the first time in their life to send them up the already clogged interstate to the abattoir to await their appointed hour with a shed full of animals of dubious extraction. They are dressed by people wearing long coats with deep pockets with whom I cannot even communicate. The carcasses hang in a cooler alongside others that were not similarly cared for in life. After the animals are processed, I return to the facility hoping to retrieve my meat.

When I return home to sell these delectable packages, the county zoning ordinance says that this is a manufactured product because it exited the farm and was reimported as a value-added product, thereby throwing our farm into the Wal-Mart category, another prohibition in agricultural areas. Just so you understand this, remember that an on-farm abattoir was illegal, so I took the animals to a legal abattoir, but now the selling of said products in an on-farm store is illegal.

Our whole culture suffers from an industrial food system that has made every part disconnected from the rest. Smelly and dirty farms are supposed to be in one place, away from people, who snuggle smugly in their cul-de-sacs and have not a clue about the out-of-sight-out-of-mind atrocities being committed to their dinner before it arrives in microwaveable, four-color-labeled, plastic packaging. Industrial abattoirs need to be located in a not-in-my-backyard place to sequester noxious odors and sights. Finally, the retail store must be located in a commercial district surrounded by lots of pavement, handicapped access, public toilets and whatever else must be required to get food to people.

The notion that animals can be raised, processed, packaged, and sold in a model that offends neither our eyes nor noses cannot even register on the average bureaucrat’s radar screen — or, more importantly, on the radar of the average consumer advocacy organization. Besides, all these single-use megalithic structures are good for the gross domestic product. Anything else is illegal.

ON-FARM SEMINARS & ‘AGRITAINMENT’

In the disconnected mind of modem America, a farm is a production unit for commodities — nothing more and nothing less. Because our land is zoned as agricultural, we cannot charge school kids for a tour of the farm because that puts us in the category of "Theme Park." Anyone paying for infotainment creates "Farmadisney," a strict no-no in agricultural zones.

Farms are not supposed to be places of enjoyment or learning. They are commodity production units dotting the landscape, just as factories are manufacturing units and office complexes are service units. In the government’s mind, integrating farm production with recreation and meaningful education creates a warped sense of agriculture.

The very notion of encouraging people to visit farms is blasphemous to an official credo that views even sparrows, starlings and flies as disease threats to immunocompromised plants and animals. Visitors entering USDA-blessed production unit farms must run through a gauntlet of toxic sanitation dips and don moonsuits in order to keep their germs to themselves. Indeed, people are viewed as hazardous foreign bodies at Concentrated Animal Feeding Operations (CAFOs).

Farmers who actually encourage folks to come to their farms threaten the health and welfare of their fecal concentration camp production unit neighbors, and therefore must be prohibited from bringing these invasive germ-dispensing humans onto their landscape. In the industrial agribusiness paradigm, farms must be protected from people, not to mention free-range poultry.

The notion that animals and plants can be raised in such a way that their enhanced immune system protects them from kindergarteners’ germs, and that the animals actually thrive when marinated in human attention, never enters the minds of government officials dedicated to protecting precarious production units.

COLLABORATIVE MARKETING

I have several neighbors who produce high-quality food or crafts that complement our own meat and poultry. Dried flower arrangements from one artisan, pickles from another, wine from another, and first-class vegetables from another. These are just for starters.

Our community is blessed with all sorts of creative artisans who offer products that we would love to stock in our on-farm retail venue. Doesn’t it make sense to encourage these customers driving out from the city to be able to go to one farm to do their rural browsing/ purchasing rather than drive all over the countryside? Furthermore, many of these artisans have neither the desire nor time to deal with patrons one-on-one. A collaborative venue is the most win-win, reasonable idea imaginable — except to government agents.

As soon as our farm offers a single item — just one — that is not produced here, we have become a Wal-Mart. Period. That means a business license, which isbasically another layer of taxes on our gross sales. The business license requires a commercial entrance, which on our country road is almost impossible to acquire due to sight-distance requirements and width regulations. Of course, zoning prohibits businesses in our agricultural zones. Remember, people are supposed to be kept away from agricultural areas — people bring diseases.

Even if we could comply with all of the above requirements, a retail outlet carries with it a host of additional regulations. We must provide designated handicapped parking, government-approved toilet facilities (our four household bathrooms in the two homes located 50 feet away from the retail building do not count) — and it can’t be a composting toilet. We must offer x-number of parking spaces. Folks, it just goes on and on, ad nauseum, and all for simply trying to help a neighbor sell her potatoes or extra pumpkins at Thanksgiving. I thought this was the home of the free. In most countries of the world, anyone can sell any of this stuff anywhere, and the hungering hordes are glad to get it, but in the great U.S. of A we’re too sophisticated to allow such bioregional commerce.

EMPLOYING LOCAL YOUNGSTERS & INTERNS

Any power tool — including a cordless screwdriver — cannot be operated by people under the age of 18. We have lots of requests from folks wanting to come as interns, but what do we call them? The government has no category for interns or neighbor young people who just want to learn and help out.

We’d love to employ all the neighboring young people. To our child-awning and worshiping culture, the only appropriate child activity is recreation, sitting in a desk, or watching TV. That’s it. That’s the extent of what children are good for. Anything else is abusive and risky.

Then we wonder why these kids grow up unmotivated and bored with life. Our local newspaper is full of articles and letters to the editor lamenting the lack of things for young people to do. Let me suggest a few things: digging postholes and building a fence, weeding the garden, planting some tomatoes, splitting some wood, feeding the chickens, washing eggs, pruning grapevines, milking the cow, building a compost pile, growing some earthworms.

These are all things that would be wonderfully meaningful work experience for the youth of our community, but you can’t simply employ people anymore. A host of government regulatory paperwork surrounds every "could you come over and help us . . . ?" By the time an employer complies with every Occupational Safety & Health Administration requirement, posts every government bulletin requirement, with-holds taxes, and shoulders Unemployment Compensation burdens and medical and child safety regulations — he or she can’t hire anybody legally or profitably.

The government has no pigeonhole for this: "I’m a 17-year-old home-schooler, and I want to learn how to farm. Could I come and have you mentor me for a year?"

What is this relationship? A student? An employee? If I pay a stipend, the government says he’s an employee. If I don’t pay, the Fair Labor Standards board says it’s slavery, which is illegal. Doesn’t matter that the young person is here of his own volition and is happy to live in a tee-pee. Housing must be permitted and up to code. Enough already. What happened to the home of the free?

BUILD A HOUSE THE WAY I WANT

You would think that if I cut the trees, mill the logs into lumber, and build the house on my own farm, I could make it however I wanted to. Think again. It’s illegal to build a house less than 900 square feet. Period. Doesn’t matter if I’m a hermit or the father of 20. The government agents have decreed, in their egocentric wisdom, that no human can live in anything less than 900 square feet.

Our son got married last year and wanted to build a small cottage on the farm, which he now oversees for the most part. Our new saying is, "He runs the farm, and I just run around." The plan was to do what Mom and Dad did for Teresa and I — trade houses when children come. That way our empty nest downsizes, and the young people can upsize in the main family farmhouse. Sounds reasonable and environmentally sensitive to me. But no, his little honeymoon cottage — or our retirement shack — had to be a 900-square-foot Taj Mahal. A state-of-the-art accredited composting toilet to avoid the need for a septic system and sewer leach field was denied.

When the hillside leach field would not meet agronomic standards and we had to install it in the floodplain, I asked the health department bureaucrat why. He said that essentially the only approvable leach fields now are alongside creeks and streams, because they are the only sites that offer dark-enough colored soils. Sounds like real environmental steward-ship, doesn’t it?

Look, if I want to build a yurt of rabbit skins and go to the bathroom in a compost pile, why is it any of the government’s business? Bureaucrats bend over back-wards to accredit, tax credit, and offer money to people wanting to build pig city-factories or bigger airports. But let a guy go to his woods, cut down some trees, and build himself a home, and a plethora of regulatory tyrants descend on the project to complicate, obfuscate, irritate, frustrate, and virtually terminate. I think it’s time to eradicate some of these laws and the piranhas who administer them.

OPTING OUT OF THE SYSTEM

I don’t ask for a dime of government money. I don’t ask for government accreditation. I don’t want to register my animals with a global positioning tattoo. I don’t want to tell officials the names of my constituents. And I sure as the dickens don’t intend to hand over my firearms. I can’t even use the "U" word.

On every side, our paternalistic culture is tightening the noose around those of us who just want to opt out of the system — and it is the freedom to opt out that differentiates tyrannical and free societies.

How a culture deals with its misfits reveals its strength. The stronger a culture, the less it fears the radical fringe. The more paranoid and precarious a culture, the less tolerance it offers.

When faith in our freedom gives way to fear of our freedom, then silencing the minority view becomes the operative protocol. The Native Americans silenced after Little Big Horn simply wanted to

worship in their beloved Black Hills, use traditional medicinal herbs to cure diseases, educate their children in the ways of their ancestors, and live in portable homes rather than log cabins. By that time these people represented absolutely no threat to the continued Westernization and domination of the North American continent by people who educated, vocated, medicated, worshiped, and habitated differently.

But coexistence was out of the question. Just like the forces that succeeded in making it illegal for me to use the "O" word, the Western success at Wounded Knee quashed the little guy. What does the Organic Trade Association have to fear from me using the "O" word? If society really wants government certification, my little market share will continue to deteriorate into oblivion. If, however, the certification effort represents a same-old, same-old power grab by the elitists to exterminate the fringe play-ers, it is merely another example of fear replacing faith.

Faith in what? Faith in diversity. Faith in each other. Faith in people’s ability to self-educate, thereby making informed decisions. Faith in seekers to find answers. Faith in marketplace dynamics to reward integrity and not cheating. Faith in Creation to heal. Faith in healthy plants and animals to withstand epizootics. Faith in earthworms to increase fertility. Faith in communities to function efficiently and honorably without centralized beltway interference. Faith in Acres U.S.A. to arrive every month with a cornucopia of insight and information.

Our culture’s current fear of bioterrorism shows the glaring weakness of a centralized, immunodeficient food system. This weakness leads to fear. Demanding from on high that we irradiate all food, register every cow with government agencies, and hire more inspectors does not show strength. It shows fear.

Indeed, official policy views all these minority production and marketing systems that have been shown faithful over the centuries to be instead things that threaten everyone and everything. As a teepee dwelling, herb healing, home educating, people loving, compost building retail farmer, I represent the real answers, but real answers must be eradicated by those who seek to build their power and fortunes on a lie — the lie being that genetic integrity can be maintained when corporate scientists begin splicing DNA. The lie that, as Charles Walters says, toxic rescue chemistry is better than a balanced biological bath. The lie that farms are disease-prone, unfriendly, inhumane places and should be zoned away from people.

Those of us who would aspire to opt out — both consumers and producers — must pray for enough cleverness to circumvent the system until the system cannot sustain itself. Cycles happen. Because things are this way today does not mean they will be this way next year. Hurrah for that.

Often, the greatest escapes occur at the moment the noose becomes tightest. I’m feeling the rope, and it’s not very loose. Society seems bound and determined to hang me for everything I want to do. But there’s power in truth. And for sure, surprises are in store that may make

society shake its collective head and begin to question some seemingly unalterable doctrines. Doctrines like the righteousness of the bureaucrat. The sanctity of government research. The protection of the Food Safety and Inspection Service. The helpfulness of the USDA.

When that day comes, you and I can graciously offer our society honest food, honest ecology, honest stewardship. May the day come quickly.

We're all Austrians now

2008-12-01T03:08:00.001-08:00

Peter Schiff, Ron Paul's economic advisor, was ridiculed in 2006-2007 for his predictions of a recession and massive decline in stock values by a financial media which is mostly filled with followers of the Keynesian school of economics who tout the current model of central banking control of the economy. Now that his predictions of a massive bust have borne true, the financial media and its Keynesian acolytes have been forced to bow down to the wisdom of the Austrian economic philosophy.

Peter Schiff Was Right 2006 - 2007

Here is Schiff again, in November 2008, being treated with the veneration that his prescience has earned him:

Kill the CRA

2008-11-30T04:23:00.000-08:00

This is a great article from the Investor's Business Daily, urging the repeal of the CRA. The CRA (the Community Reinvestment Act) is a federal regulation that is doing tremendous harm to the economy, and is on the top of the list of government regulations and institutions that should to be abolished alongside the Federal Reserve and Fannie Mae/Freddie Mac.

Stop Covering Up And Kill The CRA

By INVESTOR'S BUSINESS DAILY

Regulation: The Community Reinvestment Act is to blame for the financial crisis, but it so powerfully serves Democrats' interests that they'll do anything to protect it — including revising history.

The CRA coerces banks into making loans based on political correctness, and little else, to people who can't afford them. Enforced like never before by the Clinton administration, the regulation destroyed credit standards across the mortgage industry, created the subprime market, and caused the housing bubble that has now burst and left us with the worst housing and banking crises since the Great Depression.

The CRA should be abolished, along with the government-sponsored enterprises that fueled the secondary market for subprimes — under pressure from Clinton, who ordered HUD to set quotas for "affirmative action" lending at Fannie Mae and Freddie Mac.

But powerful Democrats in Washington want to protect the act — along with Fannie and Freddie — and spin the subprime scandal as the result of too little regulation, not too much.

"Repealing or weakening the CRA would be a mistake," warns Senate Banking Committee Chairman Chris Dodd, D-Conn., who argues that the CRA should be strengthened.

Dodd, the top recipient of Fannie donations and himself a beneficiary of a sweetheart mortgage brokered by a subprime lender, recently invited one of Clinton's top enforcers of the CRA to testify.

"The notion that CRA has caused this problem is a pernicious thought," said former Comptroller of the Currency Gene Ludwig. "These are not truthful statements. The CRA has helped to create a better and sounder world for finance, not the opposite."

Dead wrong. But the mainstream media believe it, and have attacked those, including this paper, who dare to tell the truth about the crisis. Already the debacle has erased $13 trillion in wealth, while putting taxpayers on the hook for up to $8 trillion in bailouts.

"The latest salvo from conservatives began via a Sept. 15 editorial in Investor's Business Daily, titled 'The Real Culprits In This Meltdown,' " grumbled a column distributed by Scripps Howard News Service. "Its editorial blamed President Clinton for today's mess."

As we said, Clinton beefed up the CRA and used it to force banks to subsidize poor communities with close to $1 trillion in high-risk loans and other commitments that flouted underwriting rules.

Yet, somehow, these media-driven myths keep getting in the way of actual facts, such as:

Fact: The 1977 law was only lightly enforced until Clinton added teeth to it in 1994 and launched an anti-redlining campaign against banks, led by Ludwig, Housing Secretary Henry Cisneros (and later Andrew Cuomo) and Attorney General Janet Reno that lasted into this decade.

Minority homeownership rates, which had been flat, began a steep rise in 1995, and home prices soon followed, stoked by easier lending. Numerous bank officials complain that they still feel pressured by CRA regulators to make inner-city loans they know are at great risk of defaulting.

Myth: The CRA could not have led to financial Armageddon, because the overwhelming share of subprime mortgages came from lenders that were not banks and not regulated by the CRA.

Fact: Nearly 4 in 10 subprime loans between 2004 and 2007 were made by CRA-covered banks such as Washington Mutual and IndyMac. And that doesn't include loans made by subprime lenders owned by banks, which were in effect covered by the CRA.

Last year, when the bubble burst, bank subprime loans totaled $142 billion, dwarfing those made by lenders.

What's more, the biggest subprime lender, Countrywide, while not subject to the law, still came under federal pressure to make risky loans in minority communities.

Clinton created a separate department at HUD to police "fair lending" at Fannie and Freddie and also at lenders like Countrywide, which became Fannie's biggest client. In 1994, Countrywide became the nation's first mortgage lender to sign with HUD a "Declaration of Fair Lending Principles and Practices."

As a result, Countrywide made more loans to minorities than any other lender — and not surprisingly, was one of the first lenders swamped by loan defaults.

Other lenders felt the heat from Reno's Justice Department, which prosecuted them for failing to operate enough branches in black neighborhoods. Reno put the entire banking industry on notice about the CRA and her enforcement program.

Myth: The CRA did not force anyone to do subprime loans or take excessive risks.

Fact: Subprime loans were the vehicle banks used to satisfy CRA compliance, and Clinton and his regulators encouraged their use. Before Clinton took office, subprimes were virtually unheard of. By the time he left, they made up more than 9% of the market for mortgage originations. Today they're 20%.

"It's instructive to go back to the early stages of the subprime market, which has essentially emerged out of the CRA," ex-Fed chief Alan Greenspan said in recent testimony on the roots of the crisis.

Clinton pushed banks to grant mortgages to minorities with poor credit by using "flexible" underwriting standards — or risk being branded racist. Rules were weakened to the point where welfare and unemployment checks were accepted as qualifying income.

Myth: Greedy investment bankers, who securitized and sold subprime mortgages, drove us to the credit crisis, not government.

Fact: Clinton's regulatory policies led to the creation of this new risk on Wall Street. His CRA amendments created the subprime market, and only after he pressured Fannie and Freddie to socialize the risk and guarantee the profit from the subprime loans did Wall Street get involved in a big way.

The exotic securitizations that have gotten so much of the blame were a symptom, not the cause, of the crisis.

The architects of the crisis want to divert attention from their own culpability by blaming the markets rather than their own regulations mandating that banks make high-risk loans based on race.

In fact, regulations had almost everything to do with this mess. And instead of strengthening them to atone for the alleged "sins of capitalism," we should be abolishing them.

Two bills in the House would be a good place to start. HR 7264, which has nine co-sponsors, would repeal the CRA. And HR 7094, with 17 co-sponsors, would dissolve Fannie Mae and Freddie Mac.

During the last severe slump, President Reagan deregulated the economy, saying: "Government is not the solution to the problem; government is the problem." He's as right today as he was then.

Brave Marine Speaks About Ron Paul, Taliban, Blackwater

2008-11-24T08:07:00.000-08:00

Ron Paul got more donations from active military personnel than all other presidential candidates combined. This shows his foreign policy is the correct one.

There are dozens of videos like this from soldiers, who say Ron Paul is the only one who gets it.

Fed pledges another secret $7.4 Trillion

2008-11-24T08:02:00.000-08:00

Bloomberg

Fed Pledges Top $7.4 Trillion to Ease Frozen Credit (Update1)

By Mark Pittman and Bob Ivry

Nov. 24 (Bloomberg) -- The U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago.

The unprecedented pledge of funds includes $2.8 trillion already tapped by financial institutions in the biggest response to an economic emergency since the New Deal of the 1930s, according to data compiled by Bloomberg. The commitment dwarfs the only plan approved by lawmakers, the Treasury Department’s $700 billion Troubled Asset Relief Program. Federal Reserve lending last week was 1,900 times the weekly average for the three years before the crisis.

When Congress approved the TARP on Oct. 3, Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson acknowledged the need for transparency and oversight. Now, as regulators commit far more money while refusing to disclose loan recipients or reveal the collateral they are taking in return, some Congress members are calling for the Fed to be reined in.

“Whether it’s lending or spending, it’s tax dollars that are going out the window and we end up holding collateral we don’t know anything about,” said Congressman Scott Garrett, a New Jersey Republican who serves on the House Financial Services Committee. “The time has come that we consider what sort of limitations we should be placing on the Fed so that authority returns to elected officials as opposed to appointed ones.”

Too Big to Fail

Bloomberg News tabulated data from the Fed, Treasury and Federal Deposit Insurance Corp. and interviewed regulatory officials, economists and academic researchers to gauge the full extent of the government’s rescue effort.

The bailout includes a Fed program to buy as much as $2.4 trillion in short-term notes, called commercial paper, that companies use to pay bills, begun Oct. 27, and $1.4 trillion from the FDIC to guarantee bank-to-bank loans, started Oct. 14.

William Poole, former president of the Federal Reserve Bank of St. Louis, said the two programs are unlikely to lose money. The bigger risk comes from rescuing companies perceived as “too big to fail,” he said.

The government committed $29 billion to help engineer the takeover in March of Bear Stearns Cos. by New York-based JPMorgan Chase & Co. and $122.8 billion in addition to TARP allocations to bail out New York-based American International Group Inc., once the world’s largest insurer. Yesterday, Citigroup Inc. received $306 billion of government guarantees for troubled mortgages and toxic assets. The Treasury Department also will inject $20 billion into the bank after its stock fell 60 percent last week.

“No question there is some credit risk there,” Poole said.

Exposure

Congressman Darrell Issa, a California Republican on the Financial Services Committee, said risk is lurking in the programs that Poole thinks are safe.

“The thing that people don’t understand is it’s not how likely that the exposure becomes a reality, but what if it does?” Issa said. “There’s no transparency to it so who’s to say they’re right?”

The worst financial crisis in two generations has erased $23 trillion, or 38 percent, of the value of the world’s companies and brought down three of the biggest Wall Street firms.

The Dow Jones Industrial Average through Friday is down 38 percent since the beginning of the year and 43 percent from its peak on Oct. 9, 2007. The S&P 500 fell 45 percent from the beginning of the year through Friday and 49 percent from its peak on Oct. 9, 2007. The Nikkei 225 Index has fallen 46 percent from the beginning of the year through Friday and 57 percent from its most recent peak of 18,261.98 on July 9, 2007. Goldman Sachs Group Inc. is down 78 percent, to $53.31, on Friday from its peak of $247.92 on Oct. 31, 2007, and 75 percent this year.

‘Snookered’

Regulators hope the rescue will contain the damage and keep banks providing the credit that is the lifeblood of the U.S. economy.

Most of the spending programs are run out of the New York Fed, whose president, Timothy Geithner, is said to be President- elect Barack Obama’s choice to be Treasury Secretary.

The money that’s been pledged is equivalent to $24,000 for every man, woman and child in the country. It’s nine times what the U.S. has spent so far on wars in Iraq and Afghanistan, according to Congressional Budget Office figures. It could pay off more than half the country’s mortgages.

“It’s unprecedented,” said Bob Eisenbeis, chief monetary economist at Vineland, New Jersey-based Cumberland Advisors Inc. and an economist for the Atlanta Fed for 10 years until January. “The backlash has begun already. Congress is taking a lot of hits from their constituents because they got snookered on the TARP big time. There’s a lot of supposedly smart people who look to be totally incompetent and it’s all going to fall on the taxpayer.”

New Deal

President Franklin D. Roosevelt’s New Deal of the 1930s, when almost 10,000 banks failed and there was no mechanism to bolster them with cash, is the only rival to the government’s current response. The savings and loan bailout of the 1990s cost $209.5 billion in inflation-adjusted numbers, of which $173 billion came from taxpayers, according to a July 1996 report by the U.S. General Accounting Office.

The 1979 U.S. government bailout of Chrysler consisted of bond guarantees, adjusted for inflation, of $4.2 billion, according to a Heritage Foundation report.

The commitment of public money is appropriate to the peril, said Ethan Harris, co-head of U.S. economic research at Barclays Capital Inc. and a former economist at the New York Fed. U.S. financial firms have taken writedowns and losses of $666.1 billion since the beginning of 2007, according to Bloomberg data.

“This is the worst capital markets crisis in modern history,” Harris said. “So you have the biggest intervention in modern history.”

Federal Lawsuit

Bloomberg has requested details of Fed lending under the U.S. Freedom of Information Act and filed a federal lawsuit against the central bank Nov. 7 seeking to force disclosure of borrower banks and their collateral.

Collateral is an asset pledged to a lender in the event a loan payment isn’t made.

“Some have asked us to reveal the names of the banks that are borrowing, how much they are borrowing, what collateral they are posting,” Bernanke said Nov. 18 to the House Financial Services Committee. “We think that’s counterproductive.”

The Fed should account for the collateral it takes in exchange for loans to banks, said Paul Kasriel, chief economist at Chicago-based Northern Trust Co. and a former research economist at the Federal Reserve Bank of Chicago.

“There is a lack of transparency here and, given that the Fed is taking on a huge amount of credit risk now, it would seem to me as a taxpayer there should be more transparency,” Kasriel said.

$4.4 Trillion

Bernanke’s Fed is responsible for $4.4 trillion of pledges, or 60 percent of the total commitment of $7.4 trillion, based on data compiled by Bloomberg concerning U.S. bailout steps started a year ago.

“Too often the public is focused on the wrong piece of that number, the $700 billion that Congress approved,” said J.D. Foster, a former staff member of the Council of Economic Advisers who is now a senior fellow at the Heritage Foundation in Washington. “The other areas are quite a bit larger.”

The Fed’s rescue attempts began last December with the creation of the Term Auction Facility to allow lending to dealers for collateral. After Bear Stearns’s collapse in March, the central bank started making direct loans to securities firms at the same discount rate it charges commercial banks, which take customer deposits.

In the three years before the crisis, such average weekly borrowing by banks was $48 million, according to the central bank. Last week it was $91.5 billion.

Lehman Failure

The failure of a second securities firm, Lehman Brothers Holdings Inc., in September, led to the creation of the Commercial Paper Funding Facility and the Money Market Investor Funding Facility, or MMIFF. The two programs, which have pledged $2.3 trillion, are designed to restore calm in the money markets, which deal in certificates of deposit, commercial paper and Treasury bills.

“Money markets seized up after Lehman failed,” said Neal Soss, chief economist at Credit Suisse Group in New York and a former aide to Fed chief Paul Volcker. “Lehman failing made a lot of subsequent actions necessary.”

The FDIC, chaired by Sheila Bair, is contributing 20 percent of total rescue commitments. The FDIC’s $1.4 trillion in guarantees will amount to a bank subsidy of as much as $54 billion over three years, or $18 billion a year, because borrowers will pay a lower interest rate than they would on the open market, according to Raghu Sundurum and Viral Acharya of New York University and the London Business School.

Bank Subsidy

Congress and the Treasury have ponied up $892 billion in TARP and other funding, or 12 percent.

The Federal Housing Administration, overseen by Department of Housing and Urban Development Secretary Steven Preston, was given the authority to guarantee $300 billion of mortgages, or about 4 percent of the total commitment, with its Hope for Homeowners program, designed to keep distressed borrowers from foreclosure.

Most of the federal guarantees reduce interest rates on loans to banks and securities firms, which would create a subsidy of at least $6.6 billion annually for the financial industry, according to data compiled by Bloomberg comparing rates charged by the Fed against market interest currently paid by banks.

Not included in the calculation of pledged funds is an FDIC proposal to prevent foreclosures by guaranteeing modifications on $444 billion in mortgages at an expected cost of $24.4 billion to be paid from the TARP, according to FDIC spokesman David Barr. The Treasury Department hasn’t approved the program.

Automakers

Bernanke and Paulson, former chief executive officer of Goldman Sachs, have also promised as much as $200 billion to shore up nationalized mortgage finance companies Fannie Mae and Freddie Mac. The FDIC arranged for $139 billion in loan guarantees for General Electric Co.’s finance unit.

The tally doesn’t include money to General Motors Corp., Ford Motor Co. and Chrysler LLC. Obama has said he favors financial assistance to keep them from collapse.

Paulson told the House Financial Services Committee Nov. 18 that the $250 billion already allocated to banks through the TARP is an investment, not an expenditure.

“I think it would be extraordinarily unusual if the government did not get that money back and more,” Paulson said.

‘We Haircut It’

In his Nov. 18 testimony, Bernanke told the House Financial Services Committee that the central bank wouldn’t lose money.

“We take collateral, we haircut it, it is a short-term loan, it is very safe, we have never lost a penny in these various lending programs,” he said.

A haircut refers to the practice of lending less money than the collateral’s current market value.

Requiring the Fed to disclose loan recipients might set off panic, said David Tobin, principal of New York-based loan-sale consultants and investment bank Mission Capital Advisors LLC.

“If you mark to market today, the banking system is bankrupt,” Tobin said. “So what do you do? You try to keep it going as best you can.”

“Mark to market” means adjusting the value of an asset, such as a mortgage-backed security, to reflect current prices.

Some of the bailout assistance could come from tax breaks in the future. The Treasury Department changed the tax code on Sept. 30 to allow banks to expand the deductions on the losses banks they were buying, according to Robert Willens, a former Lehman Brothers tax and accounting analyst who teaches at Columbia University Business School in New York.

‘Wells Fargo Notice’

Wells Fargo & Co., which is buying Charlotte, North Carolina-based Wachovia Corp., will be able to deduct $22 billion, Willens said. Adding in other banks, the code change will cost $29 billion, he said.

“The rule is now popularly known among tax lawyers as the ‘Wells Fargo Notice,’” Willens said.

The regulation was changed to make it easier for healthy banks to buy troubled ones, said Treasury Department spokesman Andrew DeSouza.

House Financial Services Committee Chairman Barney Frank said he was angry that banks used the money for acquisitions.

“The only purpose for this money is to lend,” said Frank, a Massachusetts Democrat. “It’s not for dividends, it’s not for purchases of new banks, it’s not for bonuses. There better be a showing of increased lending roughly in the amount of the capital infusions” or Congress may not approve the second half of the TARP money.

A Tremendous Speech by Ron Paul

2008-11-22T01:31:00.001-08:00

Yesterday, on November 20, 2008, Ron Paul made a tremendous speech before the U.S. House of Representatives:

Statement of Congressman Ron Paul

United States House of Representatives

The Austrians Were Right

Madame Speaker, many Americans are hoping the new administration will solve the economic problems we face. That’s not likely to happen, because the economic advisors to the new President have no more understanding of how to get us out of this mess than previous administrations and Congresses understood how the crisis was brought about in the first place.

Except for a rare few, Members of Congress are unaware of Austrian Free Market economics. For the last 80 years, the legislative, judiciary and executive branches of our government have been totally influenced by Keynesian economics. If they had had any understanding of the Austrian economic explanation of the business cycle, they would have never permitted the dangerous bubbles that always lead to painful corrections.

Today, a major economic crisis is unfolding. New government programs are started daily, and future plans are being made for even more. All are based on the belief that we’re in this mess because free-market capitalism and sound money failed. The obsession is with more spending, bailouts of bad investments, more debt, and further dollar debasement. Many are saying we need an international answer to our problems with the establishment of a world central bank and a single fiat reserve currency. These suggestions are merely more of the same policies that created our mess and are doomed to fail.

At least 90% of the cause for the financial crisis can be laid at the doorstep of the Federal Reserve. It is the manipulation of credit, the money supply, and interest rates that caused the various bubbles to form. Congress added fuel to the fire by various programs and institutions like the Community Reinvestment Act, Fannie Mae and Freddie Mac, FDIC, and HUD mandates, which were all backed up by aggressive court rulings.

The Fed has now doled out close to $2 trillion in subsidized loans to troubled banks and other financial institutions. The Federal Reserve and Treasury constantly brag about the need for “transparency” and “oversight,” but it’s all just talk – they want none of it. They want secrecy while the privileged are rescued at the expense of the middle class.

It is unimaginable that Congress could be so derelict in its duty. It does nothing but condone the arrogance of the Fed in its refusal to tell us where the $2 trillion has gone. All Members of Congress and all Americans should be outraged that conditions could deteriorate to this degree. It’s no wonder that a large and growing number of Americans are now demanding an end to the Fed.

The Federal Reserve created our problem, yet it manages to gain even more power in the socialization of the entire financial system. The whole bailout process this past year was characterized by no oversight, no limits, no concerns, no understanding, and no common sense.

Similar mistakes were made in the 1930s and ushered in the age of the New Deal, the Fair Deal, the Great Society and the supply-siders who convinced conservatives that deficits didn’t really matter after all, since they were anxious to finance a very expensive deficit-financed American empire.

All the programs since the Depression were meant to prevent recessions and depressions. Yet all that was done was to plant the seeds of the greatest financial bubble in all history. Because of this lack of understanding, the stage is now set for massive nationalization of the financial system and quite likely the means of production.

Although it is obvious that the Keynesians were all wrong and interventionism and central economic planning don’t work, whom are we listening to for advice on getting us out of this mess? Unfortunately, it’s the Keynesians, the socialists, and big-government proponents.

Who’s being ignored? The Austrian free-market economists – the very ones who predicted not only the Great Depression, but the calamity we’re dealing with today. If the crisis was predictable and is explainable, why did no one listen? It’s because too many politicians believed that a free lunch was possible and a new economic paradigm had arrived. But we’ve heard that one before – like the philosopher’s stone that could turn lead into gold. Prosperity without work is a dream of the ages.

Over and above this are those who understand that political power is controlled by those who control the money supply. Liberals and conservatives, Republicans and Democrats came to believe, as they were taught in our universities, that deficits don’t matter and that Federal Reserve accommodation by monetizing debt is legitimate and never harmful. The truth is otherwise. Central economic planning is always harmful. Inflating the money supply and purposely devaluing the dollar is always painful and dangerous.

The policies of big-government proponents are running out of steam. Their policies have failed and will continue to fail. Merely doing more of what caused the crisis can hardly provide a solution.

The good news is that Austrian economists are gaining more acceptance every day and have a greater chance of influencing our future than they’ve had for a long time.

The basic problem is that proponents of big government require a central bank in order to surreptitiously pay bills without direct taxation. Printing needed money delays the payment. Raising taxes would reveal the true cost of big government, and the people would revolt. But the piper will be paid, and that’s what this crisis is all about.

There are limits. A country cannot forever depend on a central bank to keep the economy afloat and the currency functionable through constant acceleration of money supply growth. Eventually the laws of economics will overrule the politicians, the bureaucrats and the central bankers. The system will fail to respond unless the excess debt and mal-investment is liquidated. If it goes too far and the wild extravagance is not arrested, runaway inflation will result, and an entirely new currency will be required to restore growth and reasonable political stability.

The choice we face is ominous: We either accept world-wide authoritarian government holding together a flawed system, OR we restore the principles of the Constitution, limit government power, restore commodity money without a Federal Reserve system, reject world government, and promote the cause of peace by protecting liberty equally for all persons. Freedom is the answer.

source

If I Had the Power to Transform America

2008-10-18T09:28:00.000-07:00

I originally posted this in a forum thread in politicsforum.org.

I am reproducing it here because I thought it was an interesting exercise.

--
If I had the power, this is how I would go about changing the political structure of the US.

I am a strong supporter of State economic autonomy, but there is a need for a governmental mechanism to coordinate cross-state infrastructure projects.

In fact, James Madison wanted to allow canals and roads to be built across America, but he could not find the authority in the Constitution:

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In his last act before leaving office, Madison vetoed on states' rights grounds a bill for "internal improvements", including roads, bridges, and canals:

Having considered the bill ... I am constrained by the insuperable difficulty I feel in reconciling this bill with the Constitution of the United States.... The legislative powers vested in Congress are specified ... in the ... Constitution, and it does not appear that the power proposed to be exercised by the bill is among the enumerated powers.
------

He urged Congress to amend the Constitution to permit the federal government to build national infrastructure:

Among the means of advancing the public interest, the occasion is a proper one for recalling the attention of Congress to the great importance of establishing throughout our country the roads and canals which can best be executed under the national authority. No objects within the circle of political economy so richly repay the expense bestowed on them; there are none the utility of which is more universally ascertained and acknowledged; none that do more honor to the government, whose wise and enlarged patriotism duly appreciates them. Nor is there any country which presents a field where Nature invites more the art of man to complete her own work for their accommodation and benefit. These considerations are strengthened, moreover, by the political effect of these facilities for intercommunication, in bringing and binding more closely together the various parts of our extended confederacy.

Whilst the states, individually, with a laudable enterprise and emulation, avail themselves of their local advantages, by new roads, by navigable canals, and by improving the streams susceptible of navigation, the general government is the more urged to similar undertakings, requiring a national jurisdiction, and national means, by the prospect of thus systematically completing so inestimable a work. And it is a happy reflection, that any defect of constitutional authority which may be encountered, can be supplied in a mode which the Constitution itself has providently pointed out.

Federal Infrastructure Board

So what I propose is a Constitutional amendment creating strict, focused provisions allowing the federal government to involve itself in national infrastructure.

I think a distributed collaborative approach is always better than one where a single individual decides on matters.

For this reason, I would have a "federal infrastructure board", which would administer projects voted on by property owners across the US. The projects would be funded by a land tax, and, as mentioned, would be voted on by property owners. Each person's vote would be proportional to how much land they have. So if one individual owns 0.5% of the land in the US, he would have a 0.5% vote.

Some of the provisions would be:

1. The Federal Infrastructure Board (from here on referred to as the Board) would be given the power to build and maintain infrastructure for the continental US (excludes Alaska and Hawaii)

2. The projects the Board undertakes would have to be of vital importance to AT LEAST two states.

3. All efforts to create the proposed project through the coordination of state governments would need to have been exhausted for the Board to have authority to undertake it.

4. The Board's annual spending could not exceed 30% of annual federal budget

5. Property owners with combined ownership holdings that would pay at least a 1% share of the tax revenues towards a given project should it pass need to nominate the project for it to be brought up for a general vote.

6. All property owners would need to participate in the general vote. They can delegate their voting rights to another party.

7. In the first 6 months of the year, projects can be nominated. In the 9th month, all nominated projects would be brought up for a vote

8. Each property owner's vote towards a particular project is proportional to how much of the total revenues needed to be raised for the project would come from taxes levied on property owned by that property owner should the project pass.

9. There is a maximum limit of 30% of the annual federal budget that the cost of the projects that a property owner votes 'Yes' on can be.

10. There are two tax structures that a project can use, a gradient tax structure, or a uniform tax structure.

A gradient tax is higher at a point, or a line, and gradually decreases at a set rate towards the outer rim of the taxed area.

A uniform tax is a uniform fee levied on each acre of the taxed area.

Each project can only use a single tax structure.

11. The share of the fees levied from each property owner for a project have to be proportional to the benefits that property owner derives from the project.

Case Example

In the case of the high-speed maglev rail network that Dave proposed, here is how it could be funded through this governing framework:

1. This infrastructure project would require two official projects to pass for it to be launched. There would be a project that levies a gradient tax along each side of the maglev line up to 150 km from the line and 300 km from its major stations that allow freight loading, and another project that would levy a uniform tax on the rest of the continental US.

2. Property owners with at least a 1% share of the land area that would be taxed under each respective project would need to nominate the two projects.

3. In the general vote, if both projects get over 50% of the vote, then the maglev rail construction project would be launched.

There are 1,995,874,608 acres in the continental US. If the area under the gradient tax structure is 204,177,610 acres, and an average of $200 is levied on each acre within this area (with the fee increasing in proportion to how close an area is to the maglev line or major station), that would raise $40.835 billion.

If $61.80 is levied on each of the 1,791,696,998 acres under the uniform tax structure, that would raise another $110.727 billion.

This would be a total of $151.562 billion for the high speed maglev line.

If the fees are collected over a 5 year period, that would be an average of $40 per acre per year in the area under the gradient tax structure, and $12.36 per acre per year in the area under the uniform tax structure.

Here's a visual of the concept:

Reducing the size of the federal government

That's for infrastructure, now as far as getting federal government spending down to 3% of GDP (from 20% now) and removing the vast unconstitutional regulatory framework (e.g. the federal reserve system) in place now, I would propose following a 15 year plan.

A Constitution board would be setup that would be in power for 15 years, and would have as its task to return the federal government to its Constitutional scope over a 15 year period.

The task of reducing spending and eliminating regulations would be broken down into 15 bite sized portions, and one portion would be tackled each year.

Spending would need to decrease by about $110 billion a year, and exactly how regulations would be phased out could be worked out in consultation with industries to cause the least amount of shock to the economy.

Currency

I would allow gold and silver to compete with fiat dollars as legal tender. With a decreased tax burden, there would be a decreased compulsion to hold dollars for government payment purposes, and the economy could for the most part choose its own currency.

Civil Effort

This political effort can only succeed with massive public support. What we need is a coordinated effort by a good portion of the 297 billionaires in the US to make this happen. We need a council, a round table, where the wealthiest Americans congregate and coordinate to spend considerable amounts of money on educating the public of the importance of this kind of effort, and funding candidates that support it.

Ron Paul and Peter Schiff get flurry of media attention

2008-10-12T01:43:00.000-07:00

In the last few weeks, since the market has begun to tank, Ron Paul and his economic advisor Peter Schiff have made several appearances on major media.

Here are a few of the interviews from the last three weeks:

Ron Paul on CNN on 09/19/2008:

Ron Paul Fox Business 10/14/2008:

Peter Schiff on CNBC 10/08/2008:

Ron Paul on Bloomberg 10/02/2008:

Ron Paul "Rescue Plan is not good", Fox Business News 10/10/2008:

Ron Paul on the Late Edition with Wolf Blitzer 09/21/2008:

Ron Paul on CNN: Buying Debt is the Wrong Solution 10/01/2008:

http://edition.cnn.com/2008/POLITICS/10/01/paul.qanda/#cnnSTCVideo

Ron Paul on Fox Business News, 09/24/2008:

Ron Paul on Cavuto, Fox News, AIG bailout, 09/17/2008:

Ron Paul on Cavuto, Fox News, 09/27/2008:

Ron Paul Rescuing The Rescue W/ Cavuto, Fox News, 10/11/2008:

Peter Schiff on Glenn Beck 10/06/2008:

Peter Schiff on Glenn Beck 10/11/2008, Part 1/5:

Peter Schiff on Alex Jones 10/02/2o08, Part 1:

Peter Schiff on CNN, 10/04/2008:

It's not surprising that Ron Paul and Peter Schiff are now being revered by the media, given that they have been predicting this crash since at least five years ago:

Ron Paul predicting collapse of Fannie/Freddie and housing bubble five years ago:

Ron Paul in the House Financial Services Committee, September 10, 2003

Despite the long-term damage to the economy inflicted by the government's interference in the housing market, the government's policy of diverting capital to other uses creates a short-term boom in housing. Like all artificially-created bubbles, the boom in housing prices cannot last forever. When housing prices fall, homeowners will experience difficulty as their equity is wiped out. Furthermore, the holders of the mortgage debt will also have a loss. These losses will be greater than they would have otherwise been had government policy not actively encouraged over-investment in housing.

Ron Paul on The Korelin Economics Report 03/2007, part 1:

Ron Paul predicting crash a year ago:

Peter Schiff Mortgage Bankers Speech, 11/2006, Part 1 of 8:

quick summary:

In 2006 Peter Schiff tells over 1000 mortgage brokers they are about to be out of jobs. Watch how he completely nails the coming real estate/mortgage debacle before anyone else even realized it was coming.

Peter Schiff Predicts The US Economic Collapse With Unbelievable Accuracy 8/28/2006:

Warren Buffett's dad and Ron Paul

2008-09-26T10:31:00.000-07:00

Warren Buffett's dad was libertarian Congressman Howard Buffett, who believed in the same things Ron Paul did.

Here is the wikipedia article about him:

Howard Buffet

Howard Homan Buffett (August 13, 1903 – April 30, 1964) was an Omaha, Nebraska businessman and four-term Republican United States Representative.

Buffett attended public schools and graduated from the University of Nebraska in Lincoln, Nebraska in 1925. While a student, Buffett was a brother of the Alpha Sigma Phi Fraternity. Entering the investment business, Buffett also served on the Omaha board of education from 1939 to 1942. In 1942 he ran for the U.S. House of Representatives in the Nebraska district in which Omaha was located, winning the Republican nomination in the primary and then the subsequent general election; he was reelected twice. In 1948 he was again the Republican nominee for another term but was defeated for reelection; however he was again the Republican nominee for the office again in 1950 and won the office back. In 1952 Buffett decided against seeking another term and returned to his investment business Buffett-Falk & Co. in Omaha, in which he worked until shortly before his death.^[1]

Buffett is remembered for his highly libertarian stance, having maintained a friendship with Murray Rothbard for a number of years. A vocal critic of the Truman Doctrine and the Korean War, speaking on the floor of Congress, he said of military interventionism that,

Even if it were desirable, America is not strong enough to police the world by military force. If that attempt is made, the blessings of liberty will be replaced by coercion and tyranny at home. Our Christian ideals cannot be exported to other lands by dollars and guns.^[2]

Although his son Warren Buffett has criticized investing in gold feeling that investing in businesses does more social good, his father, Howard Buffett, was a proponent of the Gold Standard. ^[3]

Warren Buffett adopted a different set of beliefs from his father, and recently was criticized by Ron Paul for his advocacy of the government bailout plan for Wall Street:

Part 1:

Part 2:

Obama shows glimmer of true leadership

2008-09-07T07:23:00.000-07:00

The situation in the halls of political power has been dire since 1913, the year the federal reserve act and the federal income tax were enacted. Since then, the size of government has steadily increased, and politicians have increasingly relied on interventionist big government rhetoric to buy votes.

Obama, as a Democrat -who have traditionally been greater advocates of big government than Republicans- has taken big government political positions that are a sad example of the kind that have done so much to harm America.

In a recent speech though, I noticed a glimmer of wisdom -a glimmer of wisdom which ignited a hope in me that maybe, just maybe, his eyes may open to the truth of what ails the economy, and he will undergo a political metamorphosis to become a defender of limited government ideals. The speech where I saw this potential was the one he made about the mortgage crisis, and the changes he thinks are needed:

He repeated many common big government positions, such as advocating another federal stimulus package, bailing out home owners who are facing mortgage problems and touting the importance of giving more federal support for state health and education programs, etc, but he also touched on the problem of the investors of semi-privatized institutions like Fanny Mae socializing the risk of their business ventures by relying on government bail-outs when things go sour.

Criticizing the big Wall Street investors is a positive step, and maybe, just maybe, it's an indication that he has the courage to stand up to a corporate-political establishment that uses big government programs as a private piggy bank, and that he will see that the only way to fight for the true interests of America and stop this kind of opportunistic exploitation of public funds by powerful interests is by cutting back on these big government programs.

His tone too gave me hope that perhaps he was coming around to seeing the truth. It was somber, as if it was donning on him that there was an inherent contradiction between his advocacy for bailing out homeowners and his criticism of bailing out investors of semi-privatized companies like Fanny Mae.

I'm probably being way too optimistic, but I welcome any move towards sobriety among the political leadership.

Stopping PRC agents from immigrating to the US

2008-08-23T19:07:00.000-07:00

As we speak, thousands of PRC agents are entering the United States every year as legal immigrants. I see this as a basic threat to the political independence of the United States. Any time there is a dispute with the Chinese government, these Chinese immigrants can be expected to exert tremendous domestic pressure on the side of China.

We saw this with Tibet, when thousands upon thousands of Chinese emigre demanded that pressure on the Chinese government cease and Tibet's struggle for freedom abandoned.

We saw this with the lead paint controversy, when thousands upon thousands of Chinese emigre demanded that Cafferty be fired for calling China's communist government a bunch of "thugs".

This pressure was not benign, it was intense and emotionally potent:

In South Korea, pro-government Chinese emigre viciously attacked an innocent American for his pro Tibetan views:

This threat will not subside. Chinese immigrants come from a country where nationalistic propaganda is overwhelming and where violence to control political opinions is legitimized.

As John Derbyshire points out, sino-fascism is alive and well in China's emigre population:

I have proposed before on VDARE that immigrants from different cultures—even, as David Hackett Fischer showed in Albion's Seed, from different regions of England—bring quite different notions of governance, nationhood and citizenship with them. These attitudes can be very persistent, surviving long after actual memories of the "old country" are forgotten.

The first part of this proposition has been brought home to me with great force recently. A few months ago I signed up for an e-mail list run by and for Chinese software engineers in the United States. A Chinese friend told me it was a good place to pick up software tips, a matter of professional interest to me. He also said that I, as the author of a novel about Chinese people in America (Seeing Calvin Coolidge in a Dream) might find interesting some of the occasional opinion pieces posted on the list.

The list turned out to be of little use. Notices of volleyball games, advertisements for rooms to rent, and advice on immigration issues were the main topics. Software tips were few and far between, and a query of my own went unanswered. The few opinion pieces were mostly vaudeville head-whacking exchanges between proponents of Taiwan independence and the Mainland One-China crowd.

I did notice that the Mainlander sides of these exchanges were expressed with extraordinary vehemence. A typical line of argument was that the Taiwanese had been psychologically deformed by the Japanese occupation (which ended 55 years ago!) and yearned to abandon their Chineseness and become slaves of the Japanese. A fiercer element thought that China should use her nuclear weapons against Taiwan, to "teach them a lesson". (On historical and oratorical evidence, China must be the odds-on favorite for the title "First Nation to Nuke Its Own People." As far back as the Korean War, Madame Chiang Kai-shek asked the U.S.A. to use atomic weapons against her countrymen.) The Taiwaners mainly responded with patient explanations that they didn't want to fall into the hands of the Chinese Communist Party, and that, given the CCP's historical record, nobody could blame them.

Eventually I decided to put my two cents in. The topic of Taiwan seemed a bit inflammatory, so I offered some fairly commonplace remarks about whether a democratized China would be able to hold on to the western territories of Tibet and East Turkestan. The base populations of those territories are non-Chinese and do not want to be ruled by China, and presumably would say so at the ballot box. If China was to have democracy (I said), this conundrum would have to be faced.

I signed myself off with my Chinese name—not out of any real intent to deceive, only because this was a Chinese e-list and I thought they might throw me off if they knew I was a round-eye. At this point I was still hoping the list might be useful.

The response to my mild, questioning remarks was astonishing. What kind of Chinese was I, that wanted to dismember the Motherland? Didn't I know that those territories had been Chinese since the beginning of time? That their inhabitants were sunk in slavery and oppression under wicked priests and landlords until rescued by Chinese occupation? (Yes, these two assertions were often made by the same person.) That all the countries of the world recognized Chinese sovereignty over them? That China's right of possession had been acknowledged by the Nationalist governments of the 1930s and 1940s, even before Mao came along? The range of tones was from baffled to furious. How could a Chinese person cast doubt on the integrity of the national borders?

We went back and forth a few times, until someone noticed that my sign-off Chinese name, "Yuehan", was the common Chinese transcription of "John". Was I really Chinese? I confessed frankly that I am not; that I am an Englishman living in America, with a Mainland-Chinese wife and two half-Chinese children.

Now the floodgates of race-hatred opened. One of the subsequent e-mails addressed me as: "England Big Nose". Another offered, as part of a long, labored attempt at sarcasm, to "kiss my hairy hand". Yet a third laid out a very complicated psychological theory trying to demonstrate (if I have understood it correctly) that for a white man to wish to marry a Chinese woman was a form of mental illness, dooming both partners to misery and their offspring to madness. Hardly any of these charming epistles failed to remind me that the British were notorious imperialists, of infamous rapacity and cruelty, whose dream of everlasting world domination now lay in ashes. There was a general opinion that we British must be fuming with rage at the impudence of our once-subject peoples in throwing us out, and that this impotent fury was what accounted for our willingness to say such incomprehensibly shocking things as that Tibetans might prefer to be ruled by other Tibetans rather than by Chinese.

Bear in mind, please, that the writers of these e-mails are the intellectual cream of Mainland China, now immigrants to the U.S. Few do not have Master's degrees; many have Ph.D.s. The average age is around thirty, I suppose. Their academic and professional qualifications, and their command of English, are sufficient to have impressed an American consul into awarding them a visa—no easy matter, allegedly. Yet for all this, their notions about national sovereignty were essentially those of the Ming dynasty mandarinate, and their knowledge of history a collection of false and preposterous clichés.

Underneath all this were some even more disturbing currents: a deep, atavistic hatred of the West and all its works; a profound scorn for Western "civilization" and "democracy"—the quotation marks seem to be obligatory. Also, a rooted conviction that China had never done anything wrong, and never could. Here are the words (I have polished the grammar a little) from a correspondent who has a Master's in Sociology from Peking University, a very prestigious institution:

Every time I read recent Chinese history, I can't help crying. What did we do in the past to make this nation, this race suffer so much? Nothing we did! It was those "honorable", "democratic", and "noble" western "civilized" people and culture! ... I suffer as my nation suffers, I cry as my people cry.

Now the greatest catastrophes to afflict the Chinese people this past 50 years have been:

the post-Revolution "land reform" (1949-52)

the Anti-Rightist campaigns (1957-58)

the "Great Leap Forward" famine (1959-61)

the Cultural Revolution (1966-76)

Total deaths: about 65 million. Total foreign involvement: zero.

If you go further back, to earlier horrors like the Boxer uprising (1900) and the Taiping rebellion (1852-64), the West does indeed share some small part of the responsibility. Yet even here, the overwhelming majority of Chinese dead (12 to 15 million in the Taiping) were killed by other Chinese, acting on Chinese orders.

"Nothing we did!" All the fault of the foreign devils!

That writer is by no means a lone eccentric. This is the voice of the new generation of Mainland Chinese, born in the 1970s and 1980s: puffed up with self-pity and self-righteousness, all their rage and frustration directed against the outside world, utterly ignorant of the modern history of their country. A well-adjusted Chinese citizen is expected to have "moved on" from the horrors of the Mao period (1949-76), yet to be seething with indignation about the Opium Wars (1839-42).

This mindset has been fostered by the Communist educational system. As Steven W. Mosher has documented in his new book Hegemon: The Chinese Plan to Dominate Asia and the World, the Communists have been at pains to replace the discredited Marxist-Leninist rationale for their rule with nationalism of the grossest and coarsest type. Chinese school history textbooks make no mention of the 1959-61 famine—in terms of the number dead, a greater human calamity than WW2—but dwell bitterly on the tale about a sign saying NO DOGS OR CHINESE at the entrance to a Shanghai park in the 1920s. (Does anybody know if this story is true?) This hyper-nationalism is not limited to the schools, either; it is carried over to movies, TV shows, popular magazines and even roadside billboards.

Cherish the Motherland, which never has done, and never could do, any wrong. Hate the foreign devils, who have inflicted untold miseries on our people, and who never cease plotting to weaken and dismember our country. The borders of the People's Republic [which are actually those of the Manchu empire, minus Outer Mongolia] are sacred and inviolable, and must not be questioned.

This is the world-view with which Chinese people emerge from their schools and universities. "England Big Nose" and "hairy hand" are the terms in which China's M.A.s and Ph.D.s address foreigners who question these dogmas. What thoughts swirl in the minds of less well-educated, less-privileged young Mainlanders, one can only wonder.

Now, an American—especially, perhaps, an American who has logged on to VDARE—might say: "Good luck to them! I only wish our people would be that fierce in their nationalism." He might also point out that I could have got some similar responses from an e-group of Irish software engineers.

Both reactions miss the point. Modern western nationalisms like the American and Irish are tied up with a longing for freedom from oppression, and have been tempered and civilized by Enlightenment rationalism. The emotions let loose in my little encounter were pre-modern, primitive; uninformed by anything from the Enlightenment, or even from the Reformation or the Renaissance for that matter, and unconnected to—in fact, rabidly hostile to—any concept of liberty, self-determination or government by consent.

I have sat with Irishmen for long evenings, discussing their history and their nationhood as topics on which different points of view might be exchanged, different opinions passionately, yet reasonably, held. No such discussion is possible with these younger Mainland Chinese. When you raise their "national question", they just lose their temper and ask how you dare be so impudent as to offer an opinion on something that only concerns Chinese people. If you ask them whether they would prefer a free, democratic China without the "three T's" (Tibet, Turkestan and Taiwan) or the present corrupt despotism with them, they unhesitatingly go for the latter.

Moreover, this Chinese group feeling is consciously racial and explicitly anti-white. Irish immigrants do not have this reflex working to alienate them from their new countrymen.
Importing Sino-Fascism?

There needs to be a better screening process to ensure PRC agents, or those loyal to the current PRC regime, are not entering the West.

Hacker Uncovers Proof Chinese Gymnast Is Underage

2008-08-21T22:09:00.000-07:00

From London's 'Times Online':

A determined computer expert has delved into cached pages on the Internet to unearth Chinese official documents showing a gymnast who took gold, edging Britain’s Beth Tweddle into fourth place, may indeed be underage.
Controversy over whether He Kexin, gold medallist in the uneven bars, is under the minimum age of 16 has surrounded her participation in the Beijing Olympics. The latest challenge over the age of the tiny Olympian comes from the discovery through a cyberspace maze of Chinese official documents listing her date of birth.
She certainly does not look as if she has reached the minimum competing age of 16. However China says her passport, issued in February, gives her birthday on January 1, 1992, and the International Olympic Committee has said proof from her passport is good enough.
If incontrovertible evidence that Ms He is underage were to come to light, Britain’s Beth Tweddle, from Cheshire, could edge up from fourth place to bronze medal position in the uneven bars. With the end of the Games just three days away, that now seems unlikely.
The latest unofficial investigation was carried out by 'Stryde', a computer security expert for the New York-based Intrepidus Group, whose site Stryde Hax revealed a detailed forensic search for Ms He’s age.
The blogger first simply tried Google, only to find that an official listing by the Chinese sports administration that had given her age could no longer be accessed. Next he tried the Google cache, only to find that Ms He’s name had been removed.
So then he tried the cache of Chinese search engine Baidu. There, he found that Baidu lists two spreadsheets in Ms He's name, both giving her date of birth as January 1, 1994 – making her 14 years and 220 days old and too young to compete at these Olympics.
The lists were compiled by the General Administration of Sport of China.
Even before anyone arrived in Beijing, American media investigations had accused China of fielding three athletes below the 16-year-old minimum age threshold. Bela Karolyi, the former US head coach, then reheated the issue by claiming that China “are using half-people” and that their flouting of the regulations was so obvious that “these people think we are stupid”.
Nastia Liukin of the US finished second behind He Kexin in the uneven bars final and would be elevated to the gold medal position should the Chinese gymnast be disqualified.
Ms He insists that she is of age. Asked by journalists about the debate, she said: “My real age is 16. I don’t care what other people say. I want other people to know that 16 is my real age.” Asked how she spent her 15th birthday, she paused and then said: “I was with my team. It was an ordinary day.”
Just nine months before the Olympics, the Chinese government’s Xinhua news agency gave Ms He’s name as 13. Officials have since dismissed that report saying Xinhua had never been given her age and had made a mistake.
Stryde, who was later named by the technology news site Information Week as Mike Walker, concludes: “Much of the coverage regarding Kexin’s age has only mentioned ‘allegations’ of fraud, and the IOC has ignored thematter completely. I believe that these primary documents, issued by the Chinese state … rise to a level of evidence higher than ‘allegation’.”
It could certainly make a difference to Britain's Tweddle, who at 23 and relatively old for a gymnast may not be able to compete in London 2012.

12 year old girl owns Fox News

2008-08-15T02:04:00.000-07:00

She reveals that Georgia started the war in a live interview, and they try to cut her off:

Chinese viciously attack American and Tibetan NGO in S. Korea

2008-08-14T23:48:00.001-07:00

Video of supporters of the Chinese government viciously attacking a Tibetan NGO worker and American in Seoul, South Korea.

The Lobby Like No Other Wants a War Like No Other

2008-08-14T19:27:00.001-07:00

This article is very thorough in explaining what the U.S. position on a war with Iran for Israel's benefit should be and what it shouldn't be.

read more | digg story

Israeli paper calls for war on Iran

2008-07-02T19:14:00.000-07:00

To show the true, murderous derangement of Israeli culture, one must see the articles being published by its media outlets.

Haaretz, which is Israel's preeminent left wing paper, published an article by Ari Shavit today titled "Facing an Iranian winter".

In it, the prospect of a US attack on Iran in the winter by the Bush administration, before an assumed President Obama takes office, is contemplated. The article describes a hypothetical decision by the Bush administration to attack Iran as

"without precedent and without legitimacy. It will be perceived as the final, delusional trumpet blast of a raving religious administration."

So far so good. Looks like Haaretz understands the dire consequences of such an attack. The article then begins explaining how Bush and Cheney might rationalize such an illegitimate move:

"That logic might lead the president and his second-in-command to the conclusion that if they do not act, neither will Obama. If Obama does not act, Iran will become a nuclear power. And if Iran goes nuclear, evil will win."

Kind of stupid logic if you ask me, especially when you consider that Iran has absolutely no chance of developing a nuclear arsenal that could ever change the balance of power in the region (Israel would win nuclear war against Iran), but the article is pointing out that this is potentially the Bush administration's logic, not any reasonable people's.

The writer of the article then reveals the extant of his maliciousness and immorality with this startling and remarkably dim-witted assertion:

"There is a genuine possibility that Bush will end his miserable presidency not with a whimper, but with a bang. The scenario is a wild one..

***

In the long run, the wild scenario is good for Israel, as it is good for the United States. A nuclear Iran will endanger Israel's existence, the stability of the Middle East and the welfare of the West. An Iran stripped of nuclear ability will allow the Middle East to become more moderate; it will enable the West to uphold its values and perpetuate its way of life for a long time to come."

So after making it clear how illegitimate a US attack on Iran would be -that only unreasonable people without regard for the will of the American nation would carry it out- the article concludes that this attack would still be good for Israel and the US. The writers' conception of morality and its proper role in guiding policy seems totally deficient. The writer sees no contradiction between an action being wrong and his view that it should be promoted as "good for Israel".

How many more people need to die to assuage the paranoid Israelis' fears that a potential competitor could threaten its power monopoly? If this is the kind of article being published by Haaretz, it's clear that Israeli culture is insane and totally oblivious to its own murderous intentions.

Jewish nationalist plot to obstruct Justice thickens

2008-05-12T23:54:00.000-07:00

Here is an excellent article from the Homo Sapien Underground blog, about how Israel supporters are working to bury the esponiage case against AIPAC officials using money from the law firm Manatt, Phelps & Phillips.

The Industrial Devolution

2008-05-03T20:30:00.001-07:00

The phenomenon occurring in the West can best be described as the Industrial Devolution, exactly the opposite process that occurred in the Industrial Revolution. Rather than wages increasing, capital accumulating, and manufacturing expanding, real wages are declining, peoples' capital is being whittled away through consumption, and the manufacturing base is disappearing.

Let's look at what is happening to America in more detail:

Since 1971, real median income for the 25-34 demographic has actually declined. This effectively means that despite all of the new technologies created since 1971, things like the internet, mobile phones, and multi-GHz computer processors, the lives of this generations' young are harder than they were for the young that lived in 1971.

The average savings rate has reached historical lows, now in the negative. This can be seen in the following chart:

People are spending more than they have, to buy products from merchants based in East Asia. East Asia is under going its own industrial revolution, complete with rising standards of living, mobility, and increased life expectancy, while America is traveling the road to serfdom.

Every election cycle more plans to fix what previous plans created are peddled by the same political class. These plans are enriching the political class like never before:

Washington is all about the money, he writes. In 2005, the Census Bureau listed seven suburban counties around the capital as among the 20 richest in the country. And it’s not just Republicans cashing in on their service. “Upon leaving office,” he notes, “more than half of the senior officials in the Clinton administration became corporate lobbyists.”
-New York Times

Meanwhile political ignorance is overwhelming the ability of the populace to control its destiny.

Every cycle, a new savior is peddled by the political class, be it Obama, Clinton, or McCain, offering a different version of economic salvation, while promoting policies that fundamentally are exactly the same as that of their predecessors, with the only difference between them being cosmetic. Meanwhile, Washington's dirty little secret is ignored:

When someone like Ron Paul does arrive, someone who tells the truth and offers the correct prescription, he is systematically sidelined by the media, who have long ago cross-pollinated with the political class:

"For a variety of reasons, some of them are obvious and some of them are mysterious, Ron Paul gets less coverage than he does raise money, and he gets less coverage than he gets votes. We can go on and on about this. There is no doubt, it’s an objective fact, that the press has decided Ron Paul is not a viable candidate."
-Tom Rosenstiel of the Project for Excellence in Journalism

The forces that have overtaken the West stem from our own failure to maintain cultural harmony. We have pitted ourselves against one another, too fixated on winning the various political/social blood feuds we find ourselves in to look out for the national interest. We have tried, using various ideologies -be they black empowerment, feminism, environmentalism, evangelism, conservatism, or multi-culturalism- to find absolution, but none have brought America into harmony.

Various forces, each separate and fighting for its own identity, have torn the national identity apart, and turned America's political system into a sad farce.

The question is, what is the answer? How do we stop the devolution? Every one is too paranoid to become a follower of someone else's movement, but perhaps the ideology of liberty provides the room needed for big egos to coexist. The Ron Paul movement only asks that you respect others' liberty, social and economic, for the same from others in return, and this mutual respect binds its followers. Perhaps this sort of flexible and tolerant ideology is what can allow America to regain its national vigor, and propel America to another golden age of expansion.

Ron Paul in 3D

2008-03-14T06:50:00.001-07:00

Check out this amazing video someone did of Ron Paul in 3D

ONE HUNDRED TWENTY SECONDS FROM NUCLEAR HOLOCAUST

2008-03-12T20:16:00.001-07:00

“USS LIBERTY” was clearly painted on her stern. There could be no mistake as to who we were. Israel knew we were American and we knew we had been identified as American and friendly as the Israelis themselves have since admitted. They plotted us on their war table and made positive ID of our ship as the LIBERTY.

read more | digg story

The Most Evil Thing in the World

2008-03-11T05:53:00.000-07:00

We know of a lot of evils in this world: US support for Saddam in the 1980's and the subsequent lies to get the US to invade Iraq in the 2000's, the Tiananmen Square Massacre, the Nazi concentration camps, the Soviet Gulags, the 18th century slave trade, etc, but none of them in my mind compare to something that is being carried out right now: the Social Security and Medicare scam.

How could I compare mass murder to the mismanagement of government retirement/health-care funds you ask? In the same way I compare the slave trade of the 18th century to that carried by the Roman empire 2000 years ago and conclude that the 18th century slave trade was a greater evil despite the one of the Roman Empire having been carried out on a far greater scale. I see it as the greater shortcoming of humanity relative to its moral potential at the time of the event. The 18th century civilization that had the capability to create Thomas Paine's Rights of Man and John Locke's belief in the equality of man is expected to function at a higher moral plane than that of Roman antiquity.

In this light, what is being done right now, as we speak, to every single American, is unfathomably evil. Every single day, this evil is being carried out, with the implicit consent of the majority of the population.

The government, under the guise of social welfare, has demanded that every individual hand over a portion of their income to the government Social Security Trust and Medicare Trust. Trillions of dollars have been taken by force -at the threat imprisonment- from millions of people, in the most developed and democratic nation in the world, the original Constitutional Republic.

The justification given for this violation of the citizens' individual liberty has been that the good that would come from the Social Security and Medicare programs would so outweigh the evil of using coercion, that on the balance it would be morally acceptable.

Instead, every year, as we speak, politicians, with the help of hundreds of thousands of their campaign aids, volunteers, and supportive media organizations, have been spending that Social Security and Medicare money on other programs, making it mathematically impossible for the United States government to ever provide Social Security and Medicare payments to all the people who were forced to contribute to the Social Security and Medicare trust funds.

Watch this video in which the Comptroller General of the United States, David Walker, says that the present Social Security and Medicare obligations of the government are impossible to fulfill due to decades of fiscal irresponsibility by politicians:

A nation that has a free press, the strongest and longest tradition of liberty and equal justice of any nation in the world, the most advanced communication network in the world, 24 hour news channels, and the greatest number of computers connected to the internet, is in effect watching passively, with eyes wide shut, as the political class steals in slow motion from generations of Americans. Over several decades, millions of people are being condemned to die a slow and painful death in poverty when they are too old and sick to work.

A nation as advanced as the United States has the benefit of having at its disposal a comprehensive record of human history and its many tragedies, as well as its many moral triumphs, to study and learn from, and yet it is simply consenting to this vile evil being carried out. Nothing in my mind is as evil as this.

Ron Paul says politicians afraid of AIPAC

2008-03-03T02:22:00.000-08:00

Ron Paul speaking at the Arab American Institute Conference:

The sad part is, there is the get out of Iraq caucus, which is made up of really really hardcore left democrats, and many of them from the black caucus, and yet when they come up with some of these resolution, even they capitulate, and I ask them "you know this is war propaganda?" and they say "I know I know, but there's a limit how much we can take on AIPAC. There's just a limit to what we can do." They will back off.

Watch the clip at the 9:50 minute mark of this video:

The Wall Street Journal and Ron Paul

2008-02-08T18:00:00.000-08:00

The Wall Street Journal has been known, for a while now, to be one of the main pillars of the neocon/Israeli-lobby propaganda machine. It was one of the principal media organizations behind the drumming up of support for the invasion of Iraq, and it has recently published several articles from the warmongering godfather of neoconservatism, Norman Podhoretz, urging the US to bomb Iran rather than use diplomacy.

One of their columnists, Bret Stephens, recently wrote a commentary attacking Ron Paul's policy of non-interventionism and libertarianism is general.

In it he calls Ron Paul "fringe", his position one borne of "libertarian conceit", and his followers "cult-like". He defends the current US policy of interventionism and especially continued US aid to Israel and military interventionism in the affairs of Israel's neighbors.

Bret Stephens is a Jewish neoconservative and former editor and chief for the right wing Israeli paper the 'Jerusalem Post'. When John Mearsheimer of the University of Chicago, and Stephen Walt, of the Kennedy School of Government at Harvard University published their groundbreaking work "The Israel Lobby and US Foreign Policy", Bret Stephens, predictably, was one of its main critics.

The Wall Street Journal is an important facet of the Israeli lobby's propaganda efforts and its attack on Ron Paul is part of this effort to promote pro-Israeli interventionist US foreign policy.

Here are a few of the ridiculous arguments made by Stephens to try to discredit Ron Paul's policy position:

Dr. Paul's own remedy is that if "we trade with everybody and talk with them . . . there's a greater incentive to work these problems out." But here's a rub.

As historian Michael Oren observes in "Power, Faith and Fantasy," his history of America's 230-year involvement in the Middle East, as early as the 1790s "many Americans had grown dismayed with the country's Middle East policy of admonishing the [Barbary] pirates while simultaneously coddling them with bribes." It was precisely out of a desire to "trade with everybody" that the early American republic was forced to build a navy, and then to go to war, to defend its commercial interests, a pattern that held true in World War I and the Persian Gulf "Tanker War" of the 1980s.

1) The fight against the Barbary pirates was extremely limited compared to the 700+ American military bases in 130 countries, plus the US occupation of Iraq and Afghanistan that is going on today. One can't compare a small naval incursion against pirate bases to decade long occupations involving half a million troops. Get real.

2) The tanker wars of the 1980's were a DIRECT result of American sponsorship of Iraq in its war against Iran. Even if we were to accept that a tanker wars scenario could happen in a world where the US didn't intervene every where, protecting those tankers is a far cry from 700+ military bases in 130 countries, with half a million American troops.

3) World War 1 was a completely unnecessary war that did not serve America's national interest. It served the narrow interests of the banks that, according to the Nye Committee, loaned Great Britain 85 times more than they loaned Germany (and therefore did not want the UK to lose the war). American intervention in WW1 cost America over a hundred thousand lives and led to the Versailles Treaty, which led to World War 2.

These details of history pose a problem not just to Dr. Paul's views of the Middle East, but to the intellectual architecture of libertarianism itself. Liberal societies are built on the belief in (and defense of) individual rights, but also on the overawing power of government to transform natural rights into civil ones. In the same way, trade between nations is only possible in the absence of robbers, pirates and other rogues. Whose job is it to get rid of them?

A strict libertarian might offer that mercenaries could be authorized to build aircraft carriers, Aegis cruisers and nuclear submarines to keep the freedom of the seas in the Straits of Hormuz and Malacca. But what happens when the pecuniary interests of mercenaries collide with the political interests of the U.S. or some other government? Ultimately, some kind of decisive power is needed there too, at least if the trading opportunities libertarians claim are so precious stand any chance of flourishing.

Private mercenaries should protect those Americans who trade in foreign countries. One can't expect the American government to protect American enterprises that go to dangerous foreign nations to do business. That would be, in essence, socializing the risk of international business. If foreign nations are obstructing international trade routes, then that is a job that the US navy can take care of. No foreign military bases or decade long occupations are needed to keep international water ways open. This is a ridiculous argument and justification for America's current policy of interventionism.

As far as mercenaries being "authorized to build aircraft carriers, Aegis cruisers and nuclear submarines", no absolutely not. The American government should not sanction or give access to proprietory American military technology to any mercenaries contracted by US nationals in foreign countries. If an American wants to do business in a foreign nation, the American government should have no authority to aid him/her in any way.

Mankind is not comprised solely of profit- and pleasure-seekers; the quest for prestige and dominance and an instinct for nihilism are also inscribed in human nature, nowhere more so than in the Middle East. Libertarianism makes no accounting for this. It assumes the relatively tame aspirations of modern American life are a baseline for human nature, not an achievement of civilization.

That's absolute nonsense. Libertarianism makes no assumptions about human nature, it makes simple declarations about the rights of man. One does not have a right to force someone else to contribute money to the protection of a foreign interest. It's as simple as that. All of this philosophical bullshit about nihilism and "the quest for prestige and dominance" has nothing to do with this discussion.

There is a not-incidental connection here between libertarianism and pacifism. George Orwell once observed that pacifism is a doctrine that can only be preached behind the protective cover of the Royal Navy. Similarly, libertarianism can only be seriously espoused under the protective cover of Leviathan.

Who said any thing about pacifism? The libertarian does not argue against fighting, but against forcing, by government mandate, every citizen to bear the costs of foreign adventures that do not serve the purpose of furthering national security.

I'm not surprised that Bret Stephens completely misses the argument for a non-interventionist foreign policy and uses weak spurious historical analogies to counter Ron Paul. A weak argument such as his cannot stand the light of honest scrutiny.

Editor of Ron Paul smear article called Arabs ‘murderous and grotesque’

2008-01-15T13:50:00.000-08:00

I learned something interesting in a Vdare.com article I read yesterday.

Martin Peretz, editor-in-chief of the New Republic magazine that 'exposed' the racist remarks in Ron Paul's 20 year old newsletters last week is himself a full-fledged racist. This is what Eric Altman, a writer for the liberal magazine 'The American Prospect', had to say about him in My Marty Peretz Problem -- And Ours:

I have gotten this far and not even gotten to the topic that usually comes up in discussions of Peretz of late, which is his obsessive and unapologetic hatred of Arabs, the evidence of which is visible nearly every day on Peretz's "The Spine." Here are just a few of the choice descriptions Peretz has had occasion to employ in his magazine about assorted Arabs, whether Palestinian, Iraqi, or of the generic variety: They are "violent, fratricidal, unreliable, primitive and crazed … barbarian"; they have created a "wretched society" and are "cruel, belligerent, intolerant, fearing"; they are "murderous and grotesque" and "can't even run a post office"; their societies "have gone bonkers over jihad" and they are "feigning outrage when they protest what they call American (or Israeli) atrocities"; they "behave like lemmings,"

It doesn't end there. One of the criticisms that James Kirchick, the 21 year old author of the Ron Paul smear article, levied against the newsletters, is that:

"The newsletters display an obsession with Israel; no other country is mentioned more often in the editions I saw …"

The New Republic magazine doesn't mention of course, that they themselves have an obsession with Israel, as noted by Eric Altman:

"It would be theoretically possible, I imagine, to overstate the centrality of Peretz's obsession with the Arab-Israeli conflict to the magazine's politics and to its editorial voice. But … it is really not too much to say that almost all of Peretz's political beliefs are subordinate to his commitment to Israel's best interests, and these interests as Peretz defines them almost always involve more war."

The most prolific critics of the anti-war candidate Ron Paul are extremely racist themselves (against Arabs), are absolutely obsessed with Israel, and support the brutal war against Iraq.

Who is leading the attack on Ron Paul?

Here's a break down of who the leading critics of the anti-war candidate are:

The New Republic. As has been noted, the New Republic's editor in chief, Martin Peretz, is obsessed with Israel and has made outrageous and hateful remarks about Arabs.

James Kirchick, the 21 year old author of the smear article, and writer for the New Republic, is a Giuliani supporter (one the most racist and pro-war candidates in the running) and was funded by extremely pro-Israeli foundations when he attended Yale (thanks Jeff), the John M. Olin Foundation and the George Frederick Jewett Foundation. This is what sourcewatch.org says about John Mr. Olin Foundation for example:

In 2001, the Foundation expended $20,482,961 to fund right-wing think tanks including the American Enterprise Institute (AEI), the Brookings Institution, the Center for Strategic and International Studies (CSIS), the Claremont Institute for the Study of Statesmanship and Political Philosophy, the Council on Foreign Relations (CFR), the Heritage Foundation, the Hoover Institution on War, Revolution and Peace, the Hudson Institute, the Independent Women's Forum, the Paul H. Nitze School of Advanced International Studies (SAIS) at Johns Hopkins University, the Manhattan Institute for Public Policy Research, and the Project for the New American Century (PNAC). "The Foundation also gives large sums of money to promote conservative programs in the country's most prestigious colleges and universities."[3][4][5]

^ For those who don't know: The Heritage Foundation has been the leading campaigner for the Iraq war. The American Enterprise Institute has had several former advisors to the Israeli government sit on its board, as well as several members of the Bush administration, and was the number one proponent for the invasion of Iraq. The Project for the New American Century (PNAC) is similar to the American Enterprise Intitute and had many of the same members.

The other major critic of Ron Paul is the website Little Green Footballs. This website has been writing articles accusing Ron Paul of being racist and being an apologist for 'Islamofascists' for months. Little Green Footballs is widely known as the most racist anti-muslim website on the internet. Little Green Footballs is also extremely pro-Israel and pro-Iraq war. From wikipedia:

For "promoting Israel, and Zionism" and "presenting Israel's side of the conflict," LGF won the "Best Israel Advocacy Blog" award from the Jerusalem Post in 2005 [5]. According to Gil Ronen, a reporter for Internet news outlet, Israel National News:[6]

If anyone ever compiles a list of Internet sites that contribute to Israel’s public relations effort, Johnson's site will probably come in first, far above the Israeli Foreign Ministry's site.

"First they ignore you, then they ridicule you, then they fight you, then you win."
-- Mahatma Gandhi

Our competitors' TV ads

2008-01-14T01:36:00.001-08:00

Huckabee:

http://www.youtube.com/watch?v=jMaJ0KtTcr0

http://www.youtube.com/watch?v=BjtGgfhKIvo

McCain:

http://youtube.com/watch?v=PH6oxEp05cw

http://youtube.com/watch?v=Oy7YAyLUCQM

Hillary:

http://youtube.com/watch?v=WruJcprsRaw

http://youtube.com/watch?v=lB-Xqi_dcDY

http://youtube.com/watch?v=3QaDUDN0G1k

http://youtube.com/watch?v=oN1UgA36YZE

A couple observations:

Their ads are based wholly on emotion.

The ads are personal and allow people to get to know the candidate

The ads blatantly lie about their proposed policies being good for America.

The ads try to convince the viewer that their candidate is trustworthy and competent based on the short speech they give promoting themselves, or by citing an anecdotal story that demonstrates their candidate's superior character.

Our campaign's TV ads in comparison:

http://www.youtube.com/watch?v=4AmY-fW3gdc

http://www.youtube.com/watch?v=ENfMexgorp4

http://www.youtube.com/watch?v=1qVmVJJaLkM

http://www.youtube.com/watch?v=k0_ZCEc9bi8

http://www.youtube.com/watch?v=k0_ZCEc9bi8

http://www.youtube.com/watch?v=WWes9BP5va8

Some observations:

All the ads but the last one appeal mostly to the intellect. They try to convince the viewer that Ron Paul is right on the over-arching issues.

Ironically, the competitors are trying to create a cult of personality, while Ron Paul's ads try to convince the viewer that his proposals are the right ones.

Causes of Inflation

2008-01-12T19:35:00.000-08:00

Inflation is caused by three things:

*An increase in the money supply
*An increase in the speed of circulation of money
*A decrease in the size of the economy

When money supply or money velocity increase, or when the economy produces less, the purchasing power of your money decreases (i.e. prices increase).

prices can be determined by the formula

P= MV/Y

allowing for

P= price

M= money supply

V= money velocity

Y= GDP output.

If GDP output increases, that means there are more goods for every dollar in circulation. As such, there's a higher demand for every dollar (purchasing power of each dollar increases), and prices decrease.

If money velocity increases, i.e. if money changes hands more quickly, then a smaller number of dollars will be used for a greater number of purchases, leaving a surplus of dollars no longer being used, leading to a decrease in demand for dollars, and prices increasing.

If money supply increases, i.e. if the federal reserve prints more dollars, then there's less demand for each dollar (purchasing power of each dollar decreases), and prices increase.

I hypothesize money velocity is also largely a function of money supply, the reasoning being that an increase in money velocity is a result of people losing faith in their dollars maintaining their value (when every year more money is printed), in other words, an increase in money velocity is a result of people opting to quickly trade in any dollars they may have for other stores of value (e.g. commodities [e.g. gold], real estate, stocks), and only acquiring dollars when they need to pay taxes or make a transaction, thereby creating a situation where people are trading dollars back and forth like hot potatoes.

Therefore, I contend that, given an economy that isn't contracting, only the federal reserve and its decision to expand the money supply can cause inflation, nothing else.