Friday, April 30, 2010
(2) Greek Mythology
(3) End Game in Greece
Making Sense of Our Fiscal Mess
The national debt was the top issue cited by voters when Gallup asked what the country's biggest problem would be in 25 years, but not everyone understands just how bad our country's finances are. After the first few trillions, people's eyes glaze over trying to count the zeros.
Wednesday, April 28, 2010
On the edge of the abyss
Portugal's slow-growing economy, drastic loss of competitiveness and high public and private indebtedness are all weaknesses that markets might put to greater test.
If Portugal comes under intense pressure, contagion might then spread to Ireland, Italy or Spain, the other euro-area countries with some mixture of big budget deficits, poor growth prospects and high debts.
Friday, February 05, 2010
(2) Prepare to get schooled in my Austrian perspective.
(2a) How Obama got Keynes wrong
(3) Microsoft’s Creative Destruction
(4) "In essence, the conservative person is simply one who finds the permanent things more pleasing that Chaos and Old Night. (Yes conservatives know, with Burke, that healthy "change is the means of our preservation.") A people's historic continuity of experience, says the conservative, offers a guide to policy far better that the abstract designs of coffee-house philosophers." - Russell Kirk, The Politics of Prudence
(5) "It is not that I have already taken hold of it or have already attained perfect maturity, but I continue my pursuit in hope that I may possess it...forgetting what lies behind but straining forward to what lies ahead, I continue my pursuit toward the goal, the prize..." - Phil 3:8-14
Saturday, January 30, 2010
The President's claim about "foreign entities" bankrolling U.S. political campaigns is also false, since the Court did not overrule laws limiting such contributions. His use of "foreign" was a conscious attempt to inflame public and Congressional opinion against the Court. Coming from a President who fancies himself a citizen of the world, and who has gone so far as to foreswear American exceptionalism, this leap into talk-show nativism is certainly illuminating. What will they think of that one in the cafes of Berlin?
(2) The Obama Contradiction: Washington is sick and broken—and it can solve all our problems.
As the TV cameras panned the chamber, I saw a friendly acquaintance of the president, a Republican who bears him no animus. Why, I asked him later, did the president not move decisively to the political center?
Because he is more "intellectually honest" than that, he said. "I don't think he can do a Bill Clinton pivot, because he's not a pragmatist, he's an ideologue. He's a community organizer. He mixes the discrimination he felt as a young man with the hardship so many feel in this country, and he wants to change it and the way to change that is government programs and not opportunity."
The great issue, this friendly critic added, is debt. The public knows this; Congress and the White House do not.
(3) Don't Rejoice Over Higher GDP Yet: U.S. economy grows at 5.7% clip, but next few quarters will be a slog.
The consumer is essentially frozen, Egan added, and even those with jobs are looking over their shoulder and holding back spending. One of the results is that credit unions are seeing an increase in savings, which inched up a tenth of a point to 4.6% in the fourth quarter, as households look to strengthen their defenses against future crises.
Monday, January 25, 2010
National governments will issue an estimated $4.5 trillion in debt this year, almost triple the average for mature economies over the preceding five years. The U.S. has allowed the total federal debt (including debt held by government agencies, like the Social Security fund) to balloon by 50% since 2006 to $12.3 trillion. The pain of repayment is not yet being felt, because interest rates are so low--close to 0% on short-term Treasury bills. Someday those rates are going to rise. Then the taxpayer will have the devil to pay.
Figures on government spending and debt
News Flash: Entitlement Spending Grows Like Giant Cancer on U.S. Economy (via Instapundit)
Sunday, November 29, 2009
'Cap and Trade Is Dead'I'm a little late to the party but it's just one more example of how out of touch Nancy/Harry/MSM are. Or are they? The reality is that global warming, just like the "crises" in health care and the economy, offer her ilk the opportunity to enlarge the scale/scope of government. Frankly, I think Nancy eats paste and probably "believes" the "science" of global warming. This is the Speaker of the House who accused the CIA of lying (but we're making jobs).
The more than 3,000 emails and documents from the University of East Anglia's Climate Research Unit (CRU) that have found their way to the Internet have blown the lid off the "science" of manmade global warming. CRU is a nerve center for many of those researchers who have authored the United Nations' global warming reports and fueled the political movement to regulate carbon.
Their correspondence show a claque of scientists massaging data to make it fit their theories, squelching scientists who disagreed, punishing academic journals that didn't toe the apocalyptic line, and hiding their work from public view. "It's no use pretending that this isn't a major blow," glumly wrote George Monbiot, a U.K. writer who has been among the fiercest warming alarmists. The documents "could scarcely be more damaging." And that's from a believer.
This scandal has real implications. Mr. Inhofe notes that international and U.S. efforts to regulate carbon were already on the ropes. The growing fear of Democrats and environmentalists is that the CRU uproar will prove a tipping point, and mark a permanent end to those ambitions.
Friday, November 20, 2009
*T-shirts are 100% cotton and manufactured by Chinese factory workers.
A $4.9 Trillion Spending Increase
Hammond: Section by Section Analysis of the Reid Bill
China warns Federal Reserve over 'printing money'
Clinton To China: Keep Buying Our Debt (CBS)
Tuesday, November 17, 2009
This seems to the norm rather than the exception. More examples here, here, here, here, here, here, here and here.
I love the smell of transparency in the morning.
Thursday, November 12, 2009
He needs to come down from his mountaintop because, in this country, only the faithful appreciate a president who consistently makes us listen to him, rather than the other way around....and a flash of brilliance.
So far, the signs aren't good. In his quest to surpass what he's done before and reprise his role as the nation's Moses, Obama appears to be on the verge of an "historic" remake of one-sixth of the American economy, namely health care - despite the fact that a solid majority of Americans oppose the change. Whatever the merits, pushing for major societal change without bringing society along is a guarantee of prolonged strife, and is as unprecedented in its own way as his election was. It is - dare we say it? - very George W. Bush-like in its disregard of the popular will; meaning that, in the ultimate irony, history may pair these two as mirror reflections of one another.
Right out of the box they propose sending people to jail for acting as economic subversives and economic traitors and yet I am, somehow, paranoid if I point out that the first step here is to reduce human freedom and increase state power.Related
And this is just a down-payment, remember. This is merely the first of many freedoms you previously believed sacrosanct to be lost. This is merely the first freedom they've realized, in advance, will have to be taken away. When their Rube Goldberg system of cross-subsidizations and stealth-rationing produces a slew of irrationalities and evasions they did not anticipate, we will have a welter of new crimes to correct all that human behavior they now find constitutes bad economic hygiene and must be outlawed.
Big Rock Candy Mountain
Friday, November 06, 2009
Monday, October 19, 2009
All the world prefers a strong dollar, except American leadership - how else to pay off our massive debts?
Weak Dollar, Oblivious Treasury?
The dollar is down an average of 15 percent in just over seven months. If it falls about 5 percent more, the dollar will hit an all-time low.
What's Inside the Deficit?
As you know now, the deficit for FY2009 has reached $1.4 trillion, or 9.9 percent of the GDP. It's the biggest deficit since the end of World War II.
Whistling Past the Graveyard
The so-called “stimulus bill” is nothing but a reorientation and massive increase in long-term spending. The real stimulus is current spending on all parts of government grossly in excess of current tax receipts. This can go on for a while, but even the balance sheet of the United States is finite.
Oil tops $80, highest since Oct 14, 2008
Friday, October 16, 2009
A $250 bribe to help the ObamaCare medicine go down.
No one ever went broke underestimating political cynicism, but these days even we can't keep up: On Wednesday, President Obama announced that he wants to send every American senior a $250 check.
The $250 checks will funnel $13 billion to some 57 million beneficiaries—in addition to whatever they have already received as part of the $787 billion stimulus.
Deficit Hits $1.4 Trillion, Complicating Stimulus Plans
Lawmakers Eye Untapped Stimulus Funds as Obama Proposes New Spending
Monday, October 12, 2009
Pelosi Says She Would Drain GOP 'Swamp'
There's another little gem in that article. According to Pelosi, "All the days after that: "Pay as you go," meaning no increasing the deficit, whether the issue is middle class tax relief, health care or some other priority."
Obama under fire over falling dollar
To Fix The Global Economy, Fix The Dollar
Tuesday, October 06, 2009
Oct. 6 (Bloomberg) -- Barack Obama is considering a mix of spending programs and tax cuts to respond to widening job losses that would amount to an additional economic stimulus without carrying that label.Related
Why has the president’s stimulus package had less than intended results? Dr. Timothy G. Nash and Dr. Keith A. Pretty of Northwood University ask that question and look at some common sense alternatives
The problem is not, as Mr. Biden would have us believe, that the government didn’t spend enough, or that government bureaucracy is slowing the pace of stimulus spending, which it is. The problem is with a package that didn’t cut taxes enough or in all the right places. People have little confidence in government spending as a catalyst for economic growth and long term prosperity. They know that business creates jobs; government largely creates taxes, regulations and spends. The U.S. economy is burdened by: onerous regulations, the third highest corporate income tax rate (39.27 percent) in the world, and a combined state and federal personal income tax rate that can exceed 46 percent in certain states.
Despite all the money coming in, the U.S. national debt is now $11.2 trillion dollars, or 78 percent of U.S. GDP, and will likely be above 100 percent of GDP by the end of next fiscal year, surpassing the 1949 level of 97.5 percent which included costs associated with World War II and post war reconstruction.
Wednesday, September 30, 2009
(2) Paul Volcker: You Call This An Economic Recovery?
(3) U.S. Economy: Chicago, Jobs Data Signal Slow Rebound
(4) Greenspan Sees Growth Slowing as Stocks ‘Flatten Out’
(5) Manufacturing, employment data push stocks lower
(6) Goldman Sachs Changes U.S. Jobs Forecast to Show Larger Cuts
(7) Stocks Slump Before Key Jobs Data
Wednesday, September 23, 2009
The government stimulus and bailout plans have had an effect at the top of the economy and might be credited with the recent rise in stock prices, but there's no sense that the economy is being rebuilt from the ground up, making a robust recovery unlikely.
Rally is for suckers
Gold's No Bubble
Taxes, Depression, and Our Current Troubles
Sunday, August 23, 2009
AP sources: $2 trillion higher deficit projected
The Obama Deficit (Instapundit)
Obama Administration to Adjust Projected Deficit; $7 Trillion 10-Year-Defict to Become...$9 Trillion (ACE)
It was an August Friday afternoon, at the start of peak vacation season
Friday Night News Dump
Why the Stimulus Flopped by Mark Steyn
The other day, wending my way from Woodsville, N.H., 40 miles south to Plymouth, I came across several “stimulus” projects — every few miles, and heralded by a two-tone sign, a hitherto rare sight on Granite State highways. The orange strip at the top said “PUTTING AMERICA BACK TO WORK” with a silhouette of a man with a shovel, and the green part underneath informed you that what you were about to see was a “PROJECT FUNDED BY THE AMERICAN RECOVERY AND REINVESTMENT ACT.” There then followed a few yards of desolate, abandoned, scarified pavement, followed by an “END OF ROAD WORKS” sign, until the next “stimulus” project a couple of bends down a quiet rural blacktop.
Tuesday, August 18, 2009
Entrepreneurs and business managers are frozen. They’ve stopped posting want ads and they’ve stopped adding staff. When I look at the chart above, I see a giant sign hanging in the window of America. It reads: “Help Not Wanted.”
No, but Obama has made them scared. Everywhere I go I hear the same story. Business owners know the little details that academics and pundits don’t, and they know what not to do. They know, for example, that payroll taxes are not only scheduled to rise, but already have risen. And they know all too well that government-mandated unemployment compensation is funded by employers through an unemployment-compensation payroll tax. As a result, they know not to hire.
Obama's Doomed Utopia by Richard A. Epstein
Barack Obama was a great, if empty, orator when running for office. He projected an elusive utopian vision of hope and change that won over the hearts of those who postponed thinking about how the brutal fact of scarce resources can stymie even his grandiose plans for social reform. Unfortunately, his campaign skills have not easily transferred to the humdrum business of governance. So much so, that his best chance for reelection requires the remainder of his legislative program to fail.
Why Obama's Ratings Are Sinking by Arthur C. Brooks
Citizens will put up with a lot—but not with anyone who imperils our future. There is practically nothing that lowers American happiness more than taking away our faith in a better tomorrow.
An Economic Recovery That Whimpers
Monday, July 27, 2009
Knowing the Endgame — in Chess and the EconomyRelated
In the agon we are considering, Barack Obama is an unskilled player. Timothy Geithner is an unskilled player. Larry Summers, Christina Romer, and Austan Goolsbee are unskilled players. (The jury is out on Ben Bernanke.) The moves they are now making will see to their embarrassment when they try to unkink the sinuosities of the endgame — assuming, as with my five-year-old, that they get that far. Indeed it appears that almost everyone in the administration is either an unskilled player, an old hack player (Joe Biden, Hillary Clinton), or a weirdo player (John Holdren, Van Jones).
This also appears to be the case with the Democratic Congress and its attendant RINOs. Duffers all or most. They cannot adhere, in Harry Frankfurt’s words, to “a disinterested and austere discipline” since they do not understand the game they are playing or are merely incapable of taking it seriously. They do not even read the bills that they pass. They are, in fact, prone to “some kind of laxity,” they are “trying to get away with something,” and they are blithely making up the rules as they go along. Frankfurt would not hesitate, despite his cachet as a Princeton philosopher, to call them bullsh*tters. But when one tackles a vital issue like the economy, there is no room for ignorance or frivolity — or bullsh*t.
Wednesday, July 15, 2009
The stimulus package has failed to stimulate as trillions of dollars of debt are being laid upon our children and grandchildren as we build turtle tunnels and try to save marsh mice. The Obama administration is trying to get money into the economy instead of leaving it where it was in the first place through tax cuts. As we near double-digit unemployment, it is failing as Carter failed, and the cry goes up: Where are the jobs?
Related (Absolute Insanity)
Your Tax Dollars at Work
Friday, July 03, 2009
The Job Market's Grim Picture: Unemployment flirts with an ugly truth--the possibility of hitting a new post-Depression high. (Forbes)
Stocks Skid on Payrolls Data (Wall Street Journal)
Unemployment in America: A rising tide (Economist)
America lost a further 467,000 non-farming jobs in June, pushing up the unemployment rate to 9.5%, a 26-year high.Related
How Politicians Bankrupted California
Obama’s jobless ‘recovery’ - unemployment at 9.5%
A Miserable Failure
Forget Green Shoots: They’re Just Weeds
Friday, June 19, 2009
Obama wagered that the deluge of money coming from the Federal Reserve would do the heavy lifting as far as stabilizing the financial sector and keeping the already apparent recession from turning into a real disaster. Voters would, thus, continue to support his policies to assert more government control over healthcare, heavily regulate energy through a costly cap-and-trade program and further intervene into the financial industry.
The gamble appears to have failed miserably, both economically and politically. The terrible tale of the tape: a) the current downturn is arguably the worse since the Great Depression; b) household wealth has fallen by $14 trillion during the past two years, including the first quarter of 2009; c) while the economy may not shrink as much this quarter as it did in the previous three months (-5.7 percent) or the final quarter of 2008 (-6.3 percent), unemployment is soaring; d) Obama himself said the jobless rate will hit 10 percent this year; d) even worse, the Federal Reserve sees it approaching 11 percent next year.
"Are you better off today than you were four years ago?"Rich Gov, Poor Gov: Why Obama can't Fix the Economy
Obamaworld: Logic in the Age of Obama.
Monday, June 01, 2009
Oil prices pushed to new highs for the year Monday on a weak dollar and new data suggesting manufacturing in China has strengthened.
Yet the pace at which energy prices rose in May has also raised questions about what is causing the surge.
One reason may be found in the number of large speculative positions taken on Nymex. The net increase in bets that benchmark crude will prices will increase rose by more than 14 percent last week, according to a report from the Commodity Futures Trading Commission.
A lot of that money is being driven by inflation fears as the dollar falls against other major currencies.
Hope and anxiety (The Economist)
The price of a barrel oil went past $68 during the day on Monday June 1st, the highest level in seven months. Although this remains less than half the peak of last July, prices are likely to remain above the norm of the past few decades, lifted with every bit of cheery economic news and as the dollar weakens. Some economists are now again talking of the approach of “three-digit oil prices”, in part as large emerging economies, such as China, India and Brazil, which are energy-intensive, appear to emerge from the worst of the downturn. In the longer term, prices could be pushed upwards thanks to demand from the emerging world and because of difficulties increasing global supply.
Wednesday, May 27, 2009
(1) Exploding Debt Threatens America
(2) Chi-Comms and Times Get It, Obama Doesn't(3) More Treasury Bond Worries
The Federal Reserve is printing money from thin air, and the government is issuing trillions of dollars in new debt as it tries to spend its way out of the recession with a huge stimulus package, new lending programs, health care overhauls and automotive rescues.
(4) And It Gets Worse: The Coming 100% Inflation (Ace)
(5) Ouch: Federal Tax Revenues Fall By Over One Third (Ace)
Obama/Reid/Pelosi will need a VAT, Cap & Trade and a slew of other taxes (beer, tomatoes, lamb) to narrow (not close) the gap. The DEM penchant for spending (printing) has set the stage for slower growth and rising instability in commodity markets (Oil at $63 bbl). Will you be better off 6 months from now? Doubtful. And so much for Obama's pledge not to tax 95% of us (Obama's 95% Illusion). These not-so-hidden taxes will increase the burden all Americans endure to keep politicos and bureaucrats in their posh Washington DC offices.
The good news for the GOP is that current economic woes have nothing to do with what Obama inherited but what his (and his cohorts) have prescribed (spend, spend, spend and spend).
Geithner To Travel To China For Economic Talks (Fox)
Get Ready For a VAT
Obama’s “Saved Or Created Jobs” Does Not Match Reality
‡Yield Curve Steepens to Record as Debt Sales Surge (Bloomberg)
Tuesday, May 26, 2009
Despite this growing glut, however, the price of oil has been rising steadily in recent weeks (see chart 2). On May 20th it closed above $60 a barrel for the first time in more than six months. That marks an increase of more than 75% since February 12th, when it sank below $34—the fourth-biggest three-month rise on record, according to Mr Currie. The price of futures contracts suggests that energy traders see the price rising higher still in the coming months and years.
Source: The Economist
Don't Believe The Optimists
The Price of Recovery: Are You Inflation Ready?
Democrats Vote for $5/Gallon Gas
The recovery will be choked by rising energy prices because the FED is playing fast and loose with the money supply. Obama's soaring rhetoric can't pacify economic realities.
Tuesday, May 12, 2009
Hyper Inflation Is Coming
Inflation or Deflation?
Don't Be Fooled - Inflation is Coming
Weak Treasury auction sends stocks lower
Gov't runs April deficit for first time since '83
The $1.8 Trillion Deficit
Credit Crisis Continues
CBO: Whoops, We Need to Revise Our Deficit Projections Up by a Tad* (Ace)
Tuesday, March 31, 2009
The biggest surprise of Mr Obama’s first two months has not been his policy preferences (most of which he advertised), but a certain lack of competence. The man who earned the sobriquet “No Drama Obama” for running such a disciplined campaign has, since coming to office, slipped on one banana skin after another.
He has spent his career, apart from a year or so in business consultancy, in the non-profit sector, first as a community organiser and later as a rising politician. In his memoirs he often speaks disparagingly about the private sector. He draws some of his keenest support from trade unions and liberal pressure-groups. The most influential think-tank in Mr Obama’s Washington, the training ground for many of his top appointees, is the Centre for American Progress, funded by liberal billionaires such as George Soros and Peter Lewis.
Sunday, March 22, 2009
(1) Crowded out
(2) We Are All Socialists Now
Thursday, March 19, 2009
Commodities roar, stocks slip, bonds steady.
The dollar remained weak, a day after the Federal Reserve said it will pump $300.0 billion into Treasuries.
The reality of a deep-pocketed buyer for government debt with a virtual printing press in its basement derailed the greenback, as the euro climbed to $1.3676, from $1.3491 a day earlier.
More dollars + the same assets = more dollars per asset = inflation.Related
The David Copperfield School of Economic Recovery
The Fed’s Monumental Move
The AIG Mystery Deepens
Dodd Admits Role In AIG Bonus Controversy
The Obama CYA Act of 2009
Tuesday, March 03, 2009
- Margaret Thatcher
President Obama Has Overreached (RealClearPolitics)
The economic assumptions that underpin his [Obama] plan don't compute. He proposes financing national health care -- one might as well call it that -- through taxing the rich and ending the Iraq war. But if he confiscated every dime in the pockets and purses of "the rich," it wouldn't be nearly enough. What's more, there wouldn't be any rich left to harass -- and tax. You don't "grow" an economy, in Bill Clinton's phrase, by penalizing and pushing around investors and risk-takers.
Emblems to Stamp Projects Funded by the Stimulus Package (ABC)
The Obama Economy (Wall Street Journal)
The market has notably plunged since Mr. Obama introduced his budget last week, and that should be no surprise. The document was a declaration of hostility toward capitalists across the economy. Health-care stocks have dived on fears of new government mandates and price controls. Private lenders to students have been told they're no longer wanted. Anyone who uses carbon energy has been warned to expect a huge tax increase from cap and trade. And every risk-taker and investor now knows that another tax increase will slam the economy in 2011, unless Mr. Obama lets Speaker Nancy Pelosi impose one even earlier.
Monday, March 02, 2009
Another Handout for AIG
And possibly not the last. As the Fed announces another bailout for AIG, the insurance giant reports daunting quarterly losses of $61.7 billion
Today the "culprit" was AIG but at some point the MSM is going to run out of excuses for Obama. The bottom line is that markets are forward looking and they don't like the European Socialism he is peddling.
Dave Shrugged (Forbes)
Stocks, reflecting our future hopes, have bonked 28% since the November election, 14% since the stimulus passed and 5% since Obama revealed his budget last week.
Street Wary Of Uncle Sam Handouts (Forbes)
THE DOW-JONES INDUSTRIAL AVERAGE since the passage of the stimulus bill. Looks like a vote of “no confidence” to me. (Instapundit)
U.S. rescue efforts may risk double-dip recession (Reuters)
Wednesday, February 25, 2009
>>> Holy Grue! <<< (in convenient chart form)
Additional background is available at Financial Armageddon and BobKrumm.com.
If you need a little palette cleanser take a look at Christopher Countrywide Dodd's nice Irish cottage. He lives like one of those greedy job-creating entrepreneurs he's always demonizing.
Mean Street: Obama’s Dow 5000
$25,573.48 - what Barack Obama's budget will cost each taxpayer
The Coming Blue State Collapse
Tuesday, February 03, 2009
The grand Keynesian myth is that you can spend money and thereby increase demand. And it’s a myth because Congress does not have a vault of money to distribute in the economy. Every dollar Congress injects into the economy must first be taxed or borrowed out of the economy. You’re not creating new demand, you’re just transferring it from one group of people to another. If Washington borrows the money from domestic lenders, then investment spending falls, dollar for dollar. If they borrow the money from foreigners, say from China, then net exports drop dollar for dollar, because the balance of payments must adjust. Therefore, again, there is no net increase in aggregate demand. It just means that one group of people has $800 billion less to spend, and the government has $800 billion more to spend.My favorite commentary on the spending plan is from Donald L. Luskin at The Conspiracy to Keep You Poor and Stupid:
How can anyone seriously think that government rushing to commit all that money for a hodge-podge of projects, programs and that other thing that begins with “P”—pork—could possibly be of any particular help to the economy? Yet apparently people do, even elite economists. In fact, it's standard textbook macroeconomics that government spending can get a country out of a recession...You shouldn't have to be an economist to see why it won't work. If government borrows money to pay for spending programs, that money has to come from somewhere. Someone has to not spend that money so that government can spend it. Economists reading other chapters of the same standard textbooks call that “crowding out.”
Monday, January 26, 2009
Source: The Stimulus Time Machine, WSJ
Three Crises In One, Washington Post
"How you can spend hundreds of millions of dollars on contraceptives – how does that stimulate the economy?"
Wednesday, January 14, 2009
Layoffs will be the rule. Least affected by the downturn are the farm belt and Texas.
Don't expect the ambitious job-creation plans Barack Obama outlined during the presidential campaign to offset much of the current recession's pain. Such plans take years to come to fruition -- if they do at all.
Congress' Financial Mess
News media people, often plagued with little understanding, fail miserably in their duty to inform the public. This is particularly evident in their reporting on the current financial meltdown, suggesting it was caused by deregulation and free markets.
Obama’s $1 Trillion Gamble
President-elect Obama is considering an economic stimulus package that will include increases in government spending and tax cuts of approximately one trillion dollars. Many fear a prolonged depression resulting from a sharp reduction in consumer spending.
Tuesday, January 13, 2009
It was really quite elementary, wrote muckraker Lincoln Steffens: Tammany owned the "plain people" because in the absence of government services, Tammany provided a helping hand. "They speak pleasant words, smile friendly smiles, notice the baby, give picnics up the River or the Sound, or a slap on the back; find jobs, most of them at city expense, but they also have news-stands, peddling privileges, railroad and other business places to dispense." And with those votes, Tammany ruled the city government and its tens of thousands of jobs and the vast ocean of boodle harvested from controlling the docks, the police, the health department, and the courts. It was a reliably rich take.
- Conquering Gotham, Jill Jonnes
History Repeats Itself
Christopher Dodd coerced banks via the Community Reinvestment Act to extend loans to uncreditworthy persons. In a free market, unfettered by interlopers, lending institutions would not have assumed such risk.
Thanks to Sen. Christopher Dodd, Rep. Barney Frank and others, the lending industry spent years issuing mortgages to millions of Americans who had no hope of repaying. Sen. Dodd and Rep. Frank believe homeownership is a right unfettered by income or credit history, and over time, they were instrumental in forcing the industry to lend to some of the least creditworthy Americans.And how about this via Instapundit:
As everyone knows, the results were disastrous. The housing bubble they helped create and inflate has burst, driving the economy into recession, the lending industry into chaos and millions of Americans into foreclosure, bankruptcy or both. (But at least Sen. Dodd got his millions in campaign cash from the financial industry and special rates on his mortgages from Countrywide Financial.)
The main problem with a payroll tax holiday is that it minimizes Congressional opportunities for graft and larding out goodies to their contributors. That makes it both wise and politically unfeasible, at least until we get a better class of congresscritter.How about one more? This one puts the DEMOCRATIC graft in perspective:
A GS-9, or a lowly municipal clerk, has far more life-and-death power over us. It's they to whom we must turn to for permission to build a house, ply a trade, open a restaurant and myriad other activities. It's government people, not rich people, who have the power to coerce and make our lives miserable. Coercive power goes a long way toward explaining political corruption.The cost of this government largesse/graft is going to come in the form of higher taxes and there are some estimates that taxes as a share of GDP will be 24 percent by 2050!
Gov. Rod Blagojevich's hawking of Barack Obama's vacated U.S. Senate seat; Ways and Means Committee Chairman Charlie Rangel's alleged tax-writing favors; former Rep. William Jefferson's business bribes; and the Jack Abramoff scandal are mere pimples on the government corruption landscape. We can think of these and similar acts as jailable illegal corruption. They pale in comparison to what's for all practical purposes the same thing, but simply legal corruption.
Thursday, January 08, 2009
(2) Opinion: Don't revive Depression-era mistakes
(3) More federal spending: New deal or raw deal? - This isn't the "history" taught in public schools.
Wednesday, December 31, 2008
"...and now the people who caused the problem(s) have been put in charge of solving it."
(1) Christopher "Countrywide" Dodd will escape any MSM scrutiny regarding his role in the banking collapse.
Dodd is just playing against the clock until Obama is sworn in. He will also avoid, like his ethically challenged colleague Charlie "Tax Skat" Rangel, any formal congressional censure. Glenn Reynolds continues to follow this story at Instapundit. Dodd is up for re-election in 2010 and the people of Connecticut will send this rotund, obtuse and ethically challenged mooncalf back to the Senate with 60% of the vote.
(2) The people of New Jersey, Michigan, and California will continue to elect the same DEM leadership that has successfully engineered higher-than-national unemployment rates, taxes, and poverty. California will declare bankruptcy in 2009.
(3) General Motors and Chrysler, under the auspices of the Car Czar and using our hard-earned tax dollars, will build "The Pelosi" and it will be the equivalent of "The Homer". Obama, under pressure from the unions, will enact Hoover like tariffs and all Americans will be forced to purchase "The Pelosi".
(4) The unemployment rate will hit 20% by the end of Q4 and it will be accompanied by rampant inflation.
(5) The FDA will approve a drug to treat the "tingle and thrill" in the leg of Chris Matthews.
(6) Obama will determine that newspapers like the NY TIMES are too big to fail.
(7) The Fairness Doctrine will pass and it will extend to the INTERNET.
(8) Melissa Etheridge will pay her taxes but Charlie "Tax Skat" Rangel will write a new loophole to circumvent his.
(9) Liberals, despite BIG gains in 2009, will still be miserable and their assault on values (religion) will reach a fever pitch.
(10) Iran will strike Israel and it will cause an international conflagration involving Russia.
(11) GOOGLE will help draft policy in the B. Hussein Obama administration and it will be influenced by Al Gore and Jimmy Carter.
(12) The US will look more like Soviet Russia of the 1950's but Pelosi, Clinton, Reid, and Obama will still live fabulously.
Monday, December 22, 2008
Protesters beaten as anger grows at Russian car import tax
"The severity used to silence the demonstration highlighted Kremlin nervousness that the protests could turn into a nationwide campaign of dissent, with dissatisfaction growing over rocketing unemployment figures and high inflation.
Many Russians are already upset that controversial oligarchs have received billions of dollars in rescue packages for their businesses, while little cash seems to have trickled down."
TARP accountability? None, apparently.
"According to this morning’s news, banks are refusing to reveal what’s being done with the money that was provided under the $350B (so far) TARP bailout money."
We just had an election in which the decisive financial melt-down was, as Roger Kimball details today, directly traceable to the Community Reinvestment Act and the Fannie/Freddie implosion — Democrat debacles through and through (with Obama as a top recipient of Fannie and Freddie pay-offs, er, I mean, contributions). Yet the Bush White House evidently figured it was beneath the president to speak out about these facts, and the GOP candidate was either blind to or frozen by the appearance of this hanging curveball, somehow deciding the campaign homestretch was, instead, the perfect time for an ode to, and preening display of, bipartisanship. After all, we wouldn't want to have elections be contests between parties about issues of importance to our lives, right?Related
And, natch, we got smoked ... and now the people who caused the problem have been put in charge of solving it, which is pretty damn bipartisan if you ask me.
It is a big part of the Left's project to control the historical narrative. If you consistently roll over for them, they will consistently roll over you. I'm delighted to find the White House now, six weeks after the election and eight months after the Bear Stearns fire-sale, telling us all about how Democrats fought off efforts to regulate Fannie and Freddie, about how "Democratic leaders brazenly encouraged Fannie and Freddie to loosen lending standards and instead encouraged the housing GSEs to play a larger and larger role in the housing market — even while explicitly acknowledging the rising risks[,]" etc.
Who caused the global economic crisis? (Hint: it wasn’t George W. Bush)
"Perhaps the most amazing thing about the Times’s little drama that casts George Bush as the protagonist of our economic tragedy is not what’s in it but what isn’t. You will search in vain for the name “Barney Frank” or the phrase “Community Reinvestment Act.” But telling the story of our economic crisis with out those elements is like staging Macbeth without Macbeth or the witches."
Capital Is On Strike
"As Shlaes writes in The Forgotten Man, if Hoover caused the Depression, FDR prolonged it by constantly attacking the investor class, whom he called the “malefactors of great wealth”–a phrase originally said by the first Roosevelt, Theodore. FDR’s attempt to pack the Supreme Court in 1937 was driven in part by his wish to tax the rich retroactively."
(Anti-) Mustard Seeds
"I’m going to get to mustard seeds in a moment, but let me first address two anti-mustard seeds: “bailout nation” and a pump-priming Fed. Bailout nation remains an ongoing issue. It really goes to the issue of government planning, industrial policy, and Uncle Sam picking winners and losers. This obviously includes Detroit, which we will probably get a decision on later this week.
Here’s a quote from President Bush that captures all my concerns about bailout nation: “I’ve abandoned free market principles to save the free market system.” Oh no. Say it ain’t so Mr. Bush. Either you believe in markets, or you don’t. Unfortunately, right now, the intellectual and policy tide out of Washington is anti-market. Not good."
Monday, December 01, 2008
What Is To Be Done?
If you only read one thing on China this fall...
Trouble in China
What Obama Could Do To Calm Financial Markets, Right Now
Obama will also have to deal with Pelosi's swamp who have a scorching case of the 'gimmies'.
CBC Six feted in Caribbean Hideaway
Shady Island 'House' Party
Stephanopolous, USAToday Agree: Obama Caused Stock Market Rally and Solid Black Friday Sales
I've heard several water cooler discussions about the benefits of lower "prices" and here (see below) Francis Cianfrocca explains the danger:
The great danger with deflation is that it becomes a spiral. As people default on their mortgages, banks lose money. Then they restrain credit even further, and more people start getting into debt-hell. Meanwhile the economy shrinks, unemployment rises, and wages fall. It all gets worse and worse.Related
That's what's bad about deflation. It has a distinctive tendency to produce long-lasting depressions.
Why you'll be on a breadline by March 2009
China Devalues Its Currency
Treasury-security Yields Continue Their Sharp Fall
- Ludwig von Mises
Giving thanks for self-reliant Americans
In The Year of Bottomless Bailouts, I am most grateful this Thanksgiving for Americans who refuse to abandon thrift, personal responsibility, and self-reliance. When the moochers and entitlement-mongers drive you mad, remember that our nation still serves as home to millions of citizens who do for themselves. Like our Founding Fathers, they are God-fearing people – the ones elitist pundits deride as “oogedy-boogedy” – who will never put their faith in The Cult of You Owe Me...
The Northwood Idea by V. Orval Watts
As hostility to businessmen grows, politicians tax them more heavily, while debasing and inflating the currency to maintain an illusion of prosperity. Then, when these policies cause rising price levels, a deluded populace demands price controls, which ambitious politicians are all too ready to impose.
The resulting shortages and "black markets" provide further excuses for more government action to combat these supposed evidences of private "greed."
This cancerous growth of government produces political "leaders" who promise peace and plenty even while they squander the fruits of industry in pauperizing the poor and waging "perpetual war for perpetual peace."
The result must be, sooner or later, a spreading decline in the quality of life despite (or because of) the increasing largess to "the poor" and the privileged, the rise of great new public works, and the display of awe-inspiring armaments.
Civilization progresses when business is widely regarded as Horatio Alger represented it in his stories seventy-five or more years ago. In those once-popular tales, work and thrift in honest business service were the high road to personal success in the broadest sense of that word. That view of business helped attract able, enterprising youths into business careers. It prevailed in this country long before Alger wrote and helps explain the astounding economic and cultural progress of the United States during the past two centuries.
Tuesday, November 25, 2008
An Anticapitalistic Myth and its ConsequencesIf you want to learn more about free markets and free enterprise I highly recommend Economics in One Lesson by Henry Hazlitt and/or The Road to Serfdom by Friedrich von Hayek.
Did laissez-faire capitalism suffer a worldwide breakdown in the financial crash and business depression of 1929-1933?
That this is what happened, and that only too-long-delayed intervention by Government revived free enterprise from this worldwide collapse is now presented as unquestioned fact by teachers and textbook writers in economics, history and political "science" throughout the world.
Thursday, November 20, 2008
Deflation: A Dangerous Specter Appears
The deflation index (From Economist.com)
Twenty Reasons Why We're Not Consuming╪
Twelve Steps To Economic Recovery
╪What a silly article. Isn't our national lack of fiscal restraint part of the problem? Maybe this androgynous looking chap can save the economy with his iPhone purchase. He can certainly use it to post on Daily Kos or Burnt Orange.
Tuesday, November 11, 2008
"Never has so much hope and hype been built from hot air. But when you sell yourself on spec, as Weis did, sooner or later, the finished product comes in."
(2) Christopher Hitchens brings us barack to reality...
"Those who think that they have just voted to legalize Utopia (and I hardly exaggerate when I say this; have you been reading the moist and trusting comments of our commentariat?) are preparing for a disillusionment that I very much doubt they will blame on themselves. The national Treasury is an echoing, empty vault; our Russian and Iranian enemies are acting even more wolfishly even as they sense a repudiation of Bush-Cheney; the lines of jobless and evicted are going to lengthen, and I don't think a diet of hope is going to cover it. Nor even a diet of audacity, though can you picture anything less audacious than the gray, safety-first figures who have so far been chosen by Obama to be on his team?"
(3) Rich Karlgaard on The Great Tax Revolt Of 2012.
"Inflation and progressive taxes are a toxic brew. We haven’t heard the phrase "bracket creep" since Ronald Reagan ran against Jimmy Carter in 1980. Reagan knew that middle-income Americans were being inflated into higher tax brackets designed for the rich and were feeling mightily annoyed about this.
I predict the 1970s will play out again. Revolt against bracket creep will re-emerge as a top political issue soon after the economy recovers, the Fed’s easy money will spill out as high single-digit inflation and Obama will fulfill his election promise to hike taxes on the "rich." Upper-middle-class professional households earning $100,000 to $250,000 a year in 2008 dollars will find themselves inflated into higher incomes and then taxed like Swedes: Their income, payroll, state, sales, dividends and capital gains taxes will all go up--and keep going up, up, up because of inflation."
(4) Barack Hussein Obama votes present on the potential bailout for GM.
"As with all things Obama, we’ve heard every side of the argument, with no suggestion that he’s made up his mind what he actually thinks. But just judging from volume, it looks like he wants General Motors to become a ward of the state, and an investment platform for all kinds of alternative-energy-using vehicles. In the process, he’ll probably avoid rationalizing and shrinking GM’s antiquated labor contracts, healthcare obligations, and other cost structures.
It’s also possible that GM’s management themselves will push the situation to a boil now, and force the outgoing Bush people to deal with it. That would probably suit Obama just fine, as it would allow him to keep looking graceful and not have to make a decision."
Related (Countdown to 2010 and 2012)
Why Obama Looks Like a One Termer
Monday, October 20, 2008
The other thing about my landlord- he didn't make his money trading paper. He earned it with sweat and I never resented him for it (even when I was writing rent checks).
Perhaps the best summary of where this country is headed is in this article by Mark Steyn.
The heart of the American Dream is aspiration. That’s why people came here from all over the world. Back in eastern Europe, the Joe Bidens and Diane Sawyers of the day were telling Joe the Peasant: “Hey, look, man. You’re a peasant in the 19th century, just like your forebears were peasants in the 12th century and your descendants will be peasants in the 26th century. So you’re never gonna be earning 250 groats a year. Don’t worry about it. Leave it to us. We know better.” And Joe the Peasant eventually figured that one day he’d like to be able to afford the Premium Gruel with just a hint of arugula and got on the boat to Ellis Island. Because America is the land where a guy who doesn’t have a 250-grand business today might just have one in five or ten years’ time.I think the story of Tito Munoz is equally inspiring because it demonstrates the growing divide between what the liberals think is right for us and what we're individually capable of.
And Obama's spread the wealth scheme is offensive to a free and hard working people...His plan - to spread the economic "success" that his party has engineered in New Jersey and Michigan - will fail because it has since time immemorial.
He is penalizing those who are trying to better themselves. He is stifling innovation and changing the course of a great and prosperous nation. No central planners have ever created prosperity by punishing those who seek to earn more by the sweat of their brow.
"It's not that I want to punish your success. I want to make sure that everybody who is behind you, that they've got a chance for success, too. My attitude is that if the economy's good for folks from the bottom up, it's gonna be good for everybody. I think when you spread the wealth around, it's good for everybody." - Barack Hussein Obama
Friday, October 10, 2008
I recall the despair that surrounded the S&L/junk-bond credit crunch twenty years ago. Nobody believed prosperity would return for a long time. Commentators on the left wrote about the decline of the U.S. economy and American power. Yet the 1990s witnessed a strong prosperity boom; the free-market model of capitalism triumphed and the socialist model in Russia and elsewhere collapsed.He also mentions this article in the WSJ by John Steele Gordon who wrote An Empire of Wealth. I read and gave a copy of this book to my Dad and find that in tumultuous times like these that history books provide a degree of reassurance.
Yes, the months ahead are going to be tough. But I remain optimistic that our free democracy and free-market economy will survive this crisis as well.
Thursday, October 09, 2008
Now, there's nothing left to inflate and the contraction will be much more painful than it would have been if they hadn't tried to fight it off the two previous times. So, it doesn't matter when the Paulson plan was put into play, since it couldn't have worked anyhow...It's a basic matter of defying economic gravity. After the boom, the bust must come eventually.
(2) You wrote "Dow Below 9,000...". Far more important is that today credit spreads reached their worst levels since the beginning of the financial crisis. Despite all of the govt interventions globally, the crisis deepens. Stock markets are just a sideshow to this mess. Meanwhile, sites like NRO are consumed with horserace discussions about the election, none of the candidates for which have a clue how to solve the crisis.
Wednesday, October 08, 2008
Time Is Up Congress - And America (HT: Instapundit)
I must caution everyone - if you are not prepared for six months to two years of unemployment, you need to be. If you are dependent on credit to survive (that is, if you couldn't make it without your credit cards) you need to fix that now.
...because history shows that when government mismanages things to this degree and refuses to respond to the will of the people, a "messiah" generally appears with a "solution" - but there will be "compromises."
Monday, October 06, 2008
Bailing out the mortgage securities industry will not help us to navigate through these icebergs. If the economy does suffer catastrophic damage, though, we may look back on the bailout as something akin to giving priority access to rich people in boarding lifeboats on the Titanic.And for the flaccid rubes emailing me to tell me the free farket has failed:
The final proof that American social policies have made mortgage lending an unviable industry rests with Fannie Mae and Freddie Mac. If sensible business people don't get into the mortgage industry because it is fundamentally a bad business, the American way has been to send in a couple of quasi-government agencies to fill the gap.Related
Fannie and Freddie dominated the mortgage industry because ultimately government was prepared to fund activities that prudent lenders would not. When their implicit government guarantee became explicit, America's system of government-directed lending on socially desirable, but commercially imprudent, lending stood exposed.
(1) How Obama, his advisors & the dems are linked to the biggest financial meltdown since the Great Depression
(2) Great Depression Myths Revisited
The current financial crisis, a new government bailout in the works, talk of regulation and deregulation and a general unease regarding America's economic future have politicians and pundits alike threatening a repeat of the Great Depression.
This week, the Mackinac Center is re-running one of its most successful and popular publications ever: "Great Myths of the Great Depression," written in 1998 and revised in 2005 by President Emeritus Lawrence W. Reed. This powerful monograph details the cause of the depression, the government interventions that sustained it, and how the myths that federal policies eventually "saved" the country have been perpetuated over the past seven decades.
Friday, September 19, 2008
(2) This post is a little more technical but also provides some good information.
(3) Something about the year 1939...
2719 HYPERION takes a look at the original Illuminations at the 1939 New York World's Fair.
(4) And in print...
"By 1939, she [France] had the oldest population in Europe, and was almost running on empty. Poverty was followed by waves of xenophobia and lassitude. There was still a huge army but it lacked the old ideals of the republic, and the civil service was demoralised, resentful and powerless."
- John Gimlette
Friday, September 05, 2008
U.S. Nears Rescue Plan For Fannie And Freddie
Financial Tsunami, Updated
Congress and the Countrywide Scandal
A $40 billion scandalRelated
To top it off, the Fannie Mae leadership was quite well-connected in D.C., especially to the Democratic Party. The Washington Post on May 23 made this all clear in black and white. The front page of that day's Business section showed how James A. Johnson, a former campaign manager for Walter Mondale's presidential run, had created "a political powerhouse."
NY Times Sugar Coats Charlie Rangel's Latest Tax Mess
Limestone Roof Commentary
There's a reason congressional approval ratings are 9%. Pelosi promised to drain the "swamp of corruption" but what has changed?
McCain is starting to look like the tough shepherd necessary to get us through what's coming. He's not really a Republican...If you check my own blog I'm on record calling him a RINO.
I fight to restore the pride and principles of our party. We were elected to change Washington, and we let Washington change us. We lost the trust of the American people when some Republicans gave in to the temptations of corruption. We lost their trust when rather than reform government, both parties made it bigger.The financial system could very well collapse and the self-serving brokenness of elected government officials from BOTH parties are in large part responsible. The question now before the American people is whether or not the fix is MORE government or less. What good will come if Obama/Pelosi/Reid just add to the largesse by tripling the bureaucratic headcount in Washington (using our money and more of it of course)? As far as I'm concerned, that just represents 3x more bureaucrats who will eventually "give in to the temptations of corruption".
Like others before him [Obama], he seems to think government is the answer to every problem; that government should take our resources and make our decisions for us. That type of change doesn't trust Americans to know what is right or what is in their own best interests. It's the attitude of politicians who are sure of themselves but have little faith in the wisdom, decency and common sense of free people. That attitude created the unresponsive bureaucracies of big government in the first place. And that's not change we can believe in...
Monday, August 25, 2008
Obama wants to repeat the mistakes of Herbert Hoover, raising individual and corporate taxes and siphoning needed investment capital out of the markets and into the hands of bureaucrats. It doesn’t seem like much of an economic recovery program.For conservatives, seeing is believing; for liberals, believing is seeing...
Tuesday, April 22, 2008
"As long as the Fed continues to cut rates, traders will keep selling the dollar, buying the euro, and buying commodities like oil," says Peter Beutel, president of the New Canaan (Conn.)-based energy risk management firm Cameron Hanover. It also doesn't help that investors are still skittish about putting more money into stocks. "Traders are relentlessly long (on oil) because there's nowhere else to go," says Phil Flynn, an analyst and vice-president at brokerage firm Alaron Futures & Options in Chicago. "They're heading to oil and other commodities for safety."In addition, contracts for commodities like wheat and corn are also spiking. In the coming weeks and months the MSM will begin to cover the impact of rising food prices in third-world and developing countries. Glenn Reynolds at Instapundit linked to a report about "food runs" in Japan (although the reports have not been substantiated).
It's unclear how much lower the dollar can go. The euro has been gaining ground against the dollar since 2003, and has risen 24% against the dollar since January, 2007. The euro increased 0.4% to $1.59 on Apr. 21 -- within 1% of a record -- as European Central Bank officials reiterated concern that inflation has accelerated.
The global food crisis is a monetary phenomenon, an unintended consequence of America's attempt to inflate its way out of a market failure. There are long-term reasons for food prices to rise, but the unprecedented spike in grain prices during the past year stems from the weakness of the American dollar. Washington's economic misery now threatens to become a geopolitical catastrophe.U.S. monetary policy is creating a global resource scramble and is already causing some nations to hoard (forbidding exports). And I doubt the FED is cutting rates to stave off a recession...My guess is that these rate cuts are for a greater good, in this case a complete meltdown of the U.S. banking system related to the subprime mortgage meltdown, derivatives, etc.
Never before in history has hunger become a global threat in a period of plentiful harvests. Global rice production will hit a record of 423 million tons in the 2007-2008 crop year, enough to satisfy global demand. The trouble is that only 7% of the world's rice supply is exported, because local demand is met by local production. Any significant increase in rice stockpiles cuts deeply into available supply for export, leading to a spike in prices. Because such a small proportion of the global rice supply trades, the monetary shock from the weak dollar was sufficient to more than double its price.
It is not only rice, of course, that the cash-rich countries of the world are buying as a store of value; the price of wheat, soy and other grains has risen almost as fast.
But the "fix" is going to be a bitter pill and it will require higher taxes, entitlement reforms and a hold in federal spending (i.e. freeze the size of government). All of these actions will result in higher interest rates and a short-term surge in unemployment.
There is not alternative because our present course (i.e. doing nothing) IS going to result in double-digit inflation and unemployment...economic hardship in severity and duration possibly equal to that of the Great Depression.
Unfortunately, Hillary and Obama will certainly raise your taxes but they won't be able to control the size of government (or reform entitlements). In fact, none of the DEM "green jobs" proposed by Hillary and Obama will come unless the greenback becomes as worthless as a mark during the Weimar Republic and the government is forced to "create" them via FDR-like work programs. Higher taxes, without offsetting cuts in spending, AND a dangerous pro-union roll-back of free trade agreements will accelerate unemployment and possibly create the conditions Hillay and/or Obama will need for those FDR-like work programs. Maybe that's the plan?
Oil: How High from Here?
Rice, death and the dollar
**I hope I'm wrong.
Monday, April 14, 2008
The segment on rewards (frequent flier miles) will make you angry, especially now since AA is charging $10 to cover the variable cost of your seat. What I found most fascinating is how little profit the airline makes on each flight. As a result, the airline is incentivized to keep those planes full and off the tarmac. At one point in the program, Greenberg shows a slide that shows how many flights between LAX, JFK and BDA one airliner must make in one week/month to reach maximum profitability.
One other comment...I thought the CEO seemed a bit smarmy.
You know that joke you like about the monkey and the sailor? JACK IT to Celine Dion with our NEW headphones
Friday, April 11, 2008
Friday, March 21, 2008
- William Shakespeare
Many people are searching for a scapegoat/bogeyman for these tumultuous economic times. In a nation of victims someone (anyone) must be held accountable for our suffering. I drafted a list of the usual bogeyman but will spare you the trauma of reading it. Instead, Mark Hillman warns that instant gratification may be at the root of our national malaise/funk. More troubling, he believes we have transferred this same instant gratification ethos to our government.
He writes: "When we the people fail to practice self-discipline at home, we cannot possibly be serious about fiscal restraint in government...In roughly three generations, American society has been transformed from a nation of penny-pinchers, scrimpers and savers to a nation of consumption-addicted spendthrifts oblivious to tomorrow."
Once on a trip to Saratoga (in the interest of full disclosure I was there wagering on the ponies) we wandered into the downtown area for some coffee. I remember peering into the window of a bank (it was a very old and venerable building) and being struck by a quote chiseled in marble and set over the tellers that read, "FRUGALITY IS THE MOTHER OF ALL THE VIRTUES." I wondered whether or not the quote would make cents (sense) to the throngs of Skidmore students darting in and out of the cafes.
More importantly, and leaving economics aside, whenever a writer says we're "oblivious to tomorrow" my ears become a little more attuned (Born to see; meant to look). I've connected the words - oblivious to tomorrow - to this dour passage from a Peggy Noonan Op-Ed:
When I was young we didn't wear earrings, but if we had, everyone would have had a pair or two. I know a 12-year-old with dozens of pairs. They're thrown all over her desk and bureau. She's not rich, and they're inexpensive, but her parents buy her more when she wants them. Someone said, "It's affluence," and someone else nodded, but I said, "Yeah, but it's also the fear parents have that we're at the end of something, and they want their kids to have good memories. They're buying them good memories, in this case the joy a kid feels right down to her stomach when the earrings are taken out of the case."This is where the left and right diverge economically and philosophically and why Obama's soaring rhetoric is so popular this campaign season.
Unfortunately, Obama is simply resurrecting the same old bogeyman to usher in "the same old Great Society programs". In the speech he says, "...a corporate culture rife with inside dealing, questionable accounting practices and short-term greed; a Washington dominated by lobbyists and special interests; economic policies that favor the few over the many."
Does Hillary believe in the same BIG government programs? Absolutely. But the Obama camp has two secret weapons- a vacuous suit with exceptional oratory skills and its closeness to the unofficial queen of the New Age movement. His camp was able to sense, very early on, what Peggy Noonan was writing about. Here is Michelle Obama on the campaign trail:
That is why I am here, because Barack Obama is the only person in this who understands that. That before we can work on the problems, we have to fix our souls. Our souls are broken in this nation.Did Oprah write that?
There was a moment in this campaign when I considered (albeit briefly) heaving reason aside and supporting Obama because I've lost all faith in our elites. This was momentary (BIG momentary) lapse of reason, for having read Kirk and Kreeft for almost as many years as Obama listened to Reverend Wright, I know where this inevitably ends:
Ideology, in short, is a political formula that promises mankind and earthly paradise; but in cruel fact what ideology has created is a series of terrestrial hells.†
But this is the opportunity of a lifetime for Obama and the liberal wing of the Democratic party and they're going for broke. There are 300+ million empty vessels waiting to be saved by Obama the Messiah and rehabilitated by legions of central planners.
I'M ASKING YOU TO BELIEVE. Not just in my ability to bring about real change in Washinton...I'm asking you to believe in yours."The Anchoress believes this painless coup was in the works for a long time and offers the best (and most beautiful) interpretation of where this "obliviousness" may take us:
- Obama '08
The ending, of course, is the coup d’état. Believing that the rest of us, now disillusioned, are no longer clinging to romantic ideals of honor, or truth or nobility, these always-restless First Children, devoted to deconstruction, believe they are about to take down the presidency, the churches, the "old" government and even the "old" media. They expect to put into place something "brand new." But believe me when I tell you what they are building is older than dirt. And up from it. Which is why they will need their fortresses. Castro lives in one, too.We have created and are responsible for this national malaise. We have opened the door for this government recklessness and malfeasance and are grossly indifferent (and some would argue expectant) to the encroachment.
They've been practicing all of this, by the way, perfecting the Art of the Painless Coup so thoroughly that most ordinary folks do not even realize what has occurred.
Over the past 40 years these hyperactive First Children have been pulling off small scale coups with varying levels of success. They managed to deconstruct the academies, so that education is less a broadening of knowledge than a narrowing of perspective. They have deconstructed the liturgy to insist that a pantomime in clownface is a vast improvement over 2000 year-old sacrament and liturgy. They have deconstructed government by constructing something so huge and unweildly that nothing coming out of it is reliable or dependable, and almost no one is accountable, either. They have deconstructed the press to the point where the truth of a story is less important than how it may be framed and spun. They have deconstructed the idea of fascism to mean "those democracies in Israel and America" rather than the freedom-suppressing regimes which surround them.
As John Hawkins writes:
We have gotten to a point in our society where people can pursue courses of action that we know, they know, that everyone knows are highly likely to end in disaster. But then, when the aforementioned tragedy inevitably occurs, there is a demand that the federal government "fix the problem."The federal government has responded by inflating our currency to postpone this reckoning despite having a tremendous moral and ethical responsibility to protect our currency from debasement. Henry Hazlitt, a man as venerable as the old bank and its motto in marble, knew the curse of inflation. He writes:
Yet the ardor for inflation never dies. It would almost seem as if no country is capable of profiting from the experience of another and no generation of learning from the suffering of its forbears. Each generation and country follows the same mirage. Each grasps for the same Dead Sea fruit that turns to dust and ashes in its mouth. For it is the nature of inflation to give birth to a thousand illusions.Ron Paul may be a little lopsided, but you know there are problems when the nation's accountant, David Walker, resigns/retires and goes on a nationwide tour to warn the country about the looming financial crisis.
Inflation itself is a form of taxation. It is perhaps the worst possible form, which usually bears hardest on those least able to pay.
Whether we like it or not, history has was a way of forcing us to confront our excesses.
†Russell Kirk, The Politics of Prudence.