Thursday, July 30, 2009

World War II Did NOT End the Great Depression

Despite the fondest wishes of Franklin D. Roosevelt's cheerleading "historians", FDR made America's economic situation substantially worse. Not even World War II could bring a halt to the Great Depression. Ironically, FDR's policies prolonged the Depression, and it was actually his death near the end of the War that helped the Depression to end.

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The energetic productivity of World War II ended the Great Depression? Well, then, in these current times of economic uncertainty, why don't you tear your house down and rebuild it? That will ensure that you're extremely productive for a while.

During WWII, historians and even some economists told us how much better of we were because we were in a war. Unemployment was way down, they cheered, even though a lot of the newly employed were coming home in body bags.

We built lots of bombs, tanks, and airplanes during the War, but building weapons of destruction does not make a country productive. Real productivity at the time sharply declined; things of real value became in shorter and shorter supply during the War, while private investment and personal consumption could not help but continue to fall.

Up to and during the war, FDR practiced heavily predatory practices against the most productive sectors of society. It was common knowledge among leaders of industry that Roosevelt's practices put a significant damper on their ability to fuel an economic expansion. Lammot Du Pont complained that "Uncertainty rules [every] situation...It is impossible to even guess at the answers."

A 1939 poll by the American Institute of Public Opinion found that nearly two thirds of respondents thought that "the attitude of the Roosevelt administration toward business is delaying business recovery." In May 1945, the AIPO asked "Do you think [Harry] Truman will be more favorable...toward business than Roosevelt was?" Eight times as many people said yes than said no.

A League of Nations study in the late 1930's indicates that FDR's New Deal created massive economic uncertainty that led to economic malaise. The destructive energies of World War II did very little to bring America out of the doldrums. It was only after FDR died and Harry Truman took over as President that government once again became predictable enough for Americans to feel comfortable enough to begin producing things again.



Wednesday, July 29, 2009

Do Mormons Have Their Head in the Sand Over Global Warming?

Based on my unscientific observation, it seems that very few Mormons believe that people have much effect on the warming of earth. Does this mean that most Mormons have their heads in the sand? Does it make our Church look a bit hickish?

I think it makes us look kinda smart.

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In a recent letter to the editor of Brigham Young University's Daily Universe, a writer bemoaned the supposed sad state of man-made global warming acceptance at BYU:
The denial of global warming seems to be epidemic in Utah. Even among students at BYU, the reality of global warming has been treated with skepticism and even animosity. I can’t help but to ask, “Why?”...
Why? Because we've already found the true

Most Mormons would love to drive a hybrid car or put up solar panels and wind turbines in our back yard--if someone can get them in our price range.

religion, and the Church of the Man-Made Warming Globe isn't it.

Mormon scientists responded to the above letter with the following:
We the undersigned have studied weather, climate and climate change for years — and we can state with certainty that there is no unanimous view among scientists on the matter of man-made catastrophic global warming.

The media and political activists have also promoted policies that attack American liberties and harm and kill people, by diverting...resources from far more urgent and worthy purposes, such as reducing poverty, malaria and malnutrition and improving the living standards for everyone.

The issue of global warming is not a war of “expertise.” It is, or should be, an objective study of scientific measurements and data — which can now confirm atmospheric CO2 plays at most a minor role in causing weather and climate change.

BYU is an institution of higher learning that should promote the seeking of truth. Similarly, science is an objective assessment of hypotheses, testing concepts against actual data and observations; it is not a matter of votes, popularity or “virtual unanimity.” We are all harmed, if we allow our universities or our science to be politicized.

Put succinctly, Mormons want truth--not politics masquerading as such.

I can think of only one or two Mormons I know who think that people have

Most Mormons are thinkers. That's why so few of them are resigned to believe the theory that the actions of mankind are baking the planet in its own carbon juices.

any appreciable affect on the greenhouse gas emissions that supposedly cause global warming. Is this because Mormons don't have any critical thinking skills? Of course we do, but I suspect that doesn't stop a lot of anti-Mormons from using claims to that effect as selling points for anti-Mormondom.

Most Mormons are thinkers. That's why, I think, so few of them are resigned to believe the theory that the actions of mankind are baking the planet in its own carbon juices. The problem such a common

When people like Al Gore think it's okay to exaggerate and lie about the seriousness of global warming in order to promote earth stewardship, I think that's where a lot of Mormons got off the global warming bus.

viewpoint poses, though, is to give the impression that Mormons don't believe in taking care of the environment. In all probability, very few non-Mormons understand our belief that of the first commandments given to Adam and Eve when they left the Garden of Eden was to take care of the earth.

Mormons don't take kindly to lies, though, even if they are of the green variety. So when Thomas Friedman, in his book Hot, Flat, and Crowded, implies that it was okay for Al Gore to exaggerate and lie about the seriousness of global warming in order to promote earth stewardship, I think that's where a lot of Mormons got off the global warming bus.

In an article entitled Farmers Reject Global Warming (ironically, the title gets it wrong), Utah farmers talk about why they don't think that man is causing all that much warming:
The Utah Farm Bureau explained that carbon dioxide is needed in agriculture to grow plants and crops.

“I don’t think people realize where their food comes from or that we benefit from the increases of carbon dioxide,” Gappmayer said. “I’ve worked to take care of Mother Earth all my life and in turn she takes care of me.”

According to the panel, research done over the past eight years indicates there has actually been a global cooling trend. Although certain months brought record-breaking heat waves and droughts, overall, the average weather pattern has been a decrease in global temperature.

“To say global warming is a huge issue is ridiculous,” said Chamberlain, a sheep farmer in Kane County. “The media has created too much hype just for nothing. You never hear the other side of the issue, which makes me not believe in it even more.”

“The media is telling us farmers that we need to be afraid of these rapidly changing weather patterns, but I don’t think the weather patterns are any different than when I first started farming over 50 years ago,” Chamberlain said.
We Mormons think that stewardship of the earth is important. We believe that we should stop deforestation. We believe that we should keep the air and water clean. Most Mormons would love to drive a hybrid car or put up solar panels and wind turbines in our back yard--if someone can get them in our price range.

Mormons may not do a very good job of portraying the importance of earth stewardship as part of our religion, but it is nonetheless a tenet thereof. At any rate, we don't have our heads in the sand about global warming, about which most of us know there is surely no consensus.

There is nothing "virtuous, lovely, or of good report or praiseworthy" about those who exaggerate and tell outright lies to further their personal crusades. Tell us the truth, and leave out the politics, and we'll all get along in our collective earth stewardship just fine.



Saturday, July 25, 2009

There's Been Way Too Much Use of the "C" Word Lately

Do you have a friend or family member for which nearly everything seems to be a crisis? Isn't it annoying? Doesn't it eventually become depressing? Have you noticed that almost none of these "crises" really is that big of a deal?

Your federal government has taken lately to calling nearly everything a crisis. If you're as sick and tired as me of one presidential administration after another running from panic to panic, perhaps you'll agree that it's time to get someone in the federal government who actually knows what they're doing.

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9/11. To me it seems like crisis mode began with the attacks on September 11, 2001. The dust had barely settled when the Bush Administration dusted off the several-hundred-page U.S.A Patriot Act. No one had a chance to read it, because according to the conventional wisdom of the day, we had no time to waste. Only if we passed this draconian new law would another attack not be imminent. It was critical to cede to government vast new powers in order to ensure that the homeland be protected from future attacks.

Have these new powers made any difference? Absolutely. Major ones. Those major differences between September 11, 2009 and its counterpart of eight years ago will be that (1) government has far more legal authority to pry into your life than it had before, (2) far more people in the world hate the increasing harlotry of American empire, and (3) Americans are far less safe than on 9/11.

9/11 seems, in retrospect, to have been the pretext that allowed the federal government to open the floodgates of "crisis". The chicken little elites have been having a field day ever since.

Bailouts. In 2006, fully a year after "untrained me" saw that the housing market was way out of kilter, Federal Reserve chairman Ben S. Bernanke said
We do not expect significant spillovers from the subprime market to the rest of the economy
As recently as 2008, U.S. Treasury Secretary Henry Paulson said
Our financial institutions are strong. Our banks are strong. They're going to be strong for many, many years.
Generally, with the exception of a government-induced housing bubble, things were fine. Had the A few days later, however, according to Paulson, the economy was on the verge of collapse--as though a legion of spaceships were en route to earth to haul part and parcel of the economy away to some far distant galaxy.

The reality was that the only part of the economy that was really unsound was Wall Street. In his book "Meltdown", Thomas Woods notes that
In fact, credit continued to be available to the creditworthy. [The large Wall Street] firms who we're told are too big to fail, are actually to big to be kept alive. The longer they are kept on life support, the more they drain capital and resources away from fundamentally sound firms that could put those resources to much more productive use...
Stimulus Packages. At change.gov, President Obama's official web site for the change we are supposed to be able believe in, the the very first statement on the subject of the economy is this:
Our country faces its most serious economic crisis since the Great Depression.
Have you ever heard of the Depression of 1920? It's not much talked about in the history books, mainly because the government did not get involved in that one, and, very predictably and unmiraculously, it took care of itself in very short order. The Great Depression, however, was one that the government did assert itself right in the middle of. Because of this assertion, a recession became a depression, and that Depression then became "Great" as government refused to stop tinkering with all the wrong levers and subsidizing all the wrong activities.

Our current economic situation is not a crisis, but it will become one if government keeps thinking that it is the economic savior.

The general solution for our supposed crisis, according to change.gov is
A Rapid, Aggressive Response to Our Financial Crisis, Using All the Tools We Have.
Apparently, "we" refers exclusively to government, because the Obama administration has no faith whatsoever in the ingenuity of the American people to work together to solve our economic problems. Rather, here's what must happen if, according to President Obama, we have any hope of emerging from this crisis:
The [National Infrastructure Reinvestment] Bank will receive an infusion of federal money, $60 billion over 10 years, to provide financing to transportation infrastructure projects across the nation. These projects will directly and indirectly create up to two million new jobs and stimulate approximately $35 billion per year in new economic activity.
Two means exist for financing economic activity: (1) the accrual of savings by millions of Americans, or (2) the creation of funny money by government. Only one of these will sustain itself and lead to a truly healthy economy. Can you guess which one? Yet the correct solution is greatly discouraged by the inflationary policies of government, which causes government to see itself as the only solution to the problem.

Swine Flu. As much as I informed myself about the true facts surrounding the "Swine Flu Crisis of 2009", I still, a time or two, allowed myself to get worked up into a mini-frenzy of worry about the health of my family. Governments around the world seem to be deeply saddened that their predictions of dire crisis did not come to fruition. Meanwhile, in the United States, questionably reputable pharmaceutical firms are set to reap billions in profits on the back of the growing fear regarding that pandemic that never was.

Health Care
. Large projects--especially those that haven't been properly studied--a prone to failure. Regardless of all the warning signs surrounding the as yet largely unread thousand-page health care bill that the Obama administration endorses, until recently Obama and leaders in congress were in a state of panic to ensure that the behemoth become law.
"We've got to get it done this year," Obama said. "We don't have any excuses. The stars are aligned."
In other words, "this is a crisis, because the stars will soon be out of alignment, and they may never align again."

How about we start small, with a couple of one-liner bills that say, for example,
"Americans shall be able to purchase health insurance from any insurance provider in any state."
Alas, however, when people are in a state of perpetual crisis, the first thing that seems to go is the capacity for perpetual thinking.

Cap and Trade. America is doing a crappy job of stewarding the environment. In fact:
  • China is outpacing us in the construction of ultra-clean coal-fired power plants.
  • After the Oil Crisis in the early 1970's Denmark decided to wean itself from Middle Eastern oil dependency. It has been "sober" for nearly three decades. With America, however, reliance on oil from the Middle East seems to fuel an Establishment power fetish.
  • Spain now generates 11.5% of all its energy needs from wind turbines.
So how do we catch up? Well, scare tactics of course! That always works doesn't it? In his book "Hot, Flat, and Crowded" Thomas Friedman says that
Too many environmentalists oppose any growth, a position that locks the poor into poverty. [As a result, t]oo many critics of environmentalism characterize any conservation as some flaky anticapital ideological dalliance.
The sky, contrary to what government power augmentation advocates would have you think, is not falling. Much like the gross inefficiency that obtains from a sixteen-year-old boy who is constantly told how worthless he is because he doesn't ever clean up his room, the the tactics of the bulk of the environmental lobby are very counterproductive.

Let's stop talking crisis all the time, especially because there is none. Let's instead talk about opportunity.

. . .

A government that thinks that it has to take care of everyone and everything will eventually become exhausted from being in a constant state of crisis. The Soviet Union eventually failed as the ever widening gyre of crisis broke apart and ultimately could not hold.

Many open-minded economists and other Americans saw our economic deterioration coming months before its most outward manifestations began to present themselves. I'm beginning to think, however, that when representatives of current and former presidential administrations claim that no one could have seen it coming, that they really didn't see it coming. That is, among other things, a sad indictment of our ability to vote with intelligence.

We can do much better. The leaders of our federal government are making an increasingly large mess of things. That could only mean that they are either inept or criminal. Either way, they don't deserve to be in office.

Americans deserve to not have to live in perpetual crisis mode.



Wednesday, July 22, 2009

Federal Reserve: The Worst Economic Decision in American History

Every function of the Federal Reserve can be accomplished without a Federal Reserve. Why then, do we have one? For precisely one reason. To enrich the few at the expense of the many.

Does it seem to you that you are one of the many at whose expense the rich are getting richer? Your mind is not playing tricks on you. The Federal Reserve is the primary cause of this phenomenon.

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According to Investopedia:
the Fed's job is to foster a sound banking system and a healthy economy.
Wow. They pretty much suck at their job, don't they?

Investopedia continues:
The biggest customer of the Federal Reserve is one of the largest spenders in the world - the U.S. government.
So, the Fed provides its services for free, right? Nope. Every dollar that the Federal Reserve loans to the United States government comes with a price. It's called interest. In other words, every dollar that is loaned by the Federal Reserve to the United States government must be paid back with interest. Based on this paradigm, America as a whole cannot help but become poorer.

Did you realize that a substantial portion of the trillions of dollars in U.S. debt is interest that we owe to a private bank? It wasn't always this way.

The Federal Reserve was not the first private central bank in American history. Several times throughout American history, private financeers have convinced the Federal Government that America would be better off if a private bank regulated the country's money supply. Every time a central bank achieved power in America, runaway inflation, along with boom and bust cycles have occurred. In reality, the only ones who really benefit from a private central bank are the private central bankers and their friends.
Each of the 12 Fed Banks provide services to financial institutions in the same way that regular banks provide services to individuals. This helps to assure the safety and efficiency of the nation's payments system.
It's a good thing we haven't had any bank

Every dollar that is loaned by the Federal Reserve to the United States government must be paid back with interest. Based on this paradigm, America as a whole cannot help but become poorer.

failures lately, what with the skill of the Federal Reserve in assuring our economic safety, huh? Or any housing crises? Or any crises in the automobile industry?

You might be of the opinion that it's important to insure Americans' savings accounts and other deposits. I disagree, but regardless of your position on this issue, the Federal Deposit Insurance Corporation is already run by the federal government. We can take care of this function without the help of a private bank. I'm sure that there are quite a few others.

It might seem necessary to hire the economically smartest men and women in our country to ensure that the right amount of money is circulating in the American economy. That makes some sense, but it would be much less costly--and much more efficient--if we paid these people a government salary instead of interest (on the interest on the interest) on the money that they "print" for us to use.

The Free Market prevailed two decades ago over the bloated and inefficient centralized control structures of socialism and communism, yet--twenty years later--the United States still relies on one of the most egregious central planning apparatuses in the history of the world for its economic planning. That is really dumb.

Ben Bernanke has single-handedly proven over the

It is time that the greatest criminal syndicate in the history of the United States be put under a strong microscope.

last few days how moronic it is for an oligarchy of men to be allowed to make economic decisions that have the potential to destroy the entire American economy.

Fed representatives have of late taken to threatening a backlash if bills to "Audit the Fed" combine to become law (HR 1207 in the House of Representatives and S 604 in the Senate). I can't wait to see the cockroaches scurry for cover when that light is turned on.

It is time that the greatest criminal syndicate in the history of the United States be put under a strong microscope.

If you haven't contacted your Representative and Senators about the Audit the Fed bills, please contact them and either thank them for supporting their respective bill or encourage them to become a bill sponsor.

Your economic future depends on it.



Monday, July 20, 2009

It's The Income Tax, Stupid

Are you of the opinion that the rich are getting richer at the expense of the poor, because government has given them too many breaks on their income taxes? Or are you of the point of view that it is immoral for government to given Earned Income Tax Credits to those who haven't earned enough many to pay any taxes? I'm neither, actually.

I'm of the opinion that the income tax is an unconscionable affront to our sensibilities and that it should be abolished. Worse than the money that it takes out of our pockets is the surefire way in which it gets Americans to hate each other.
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Government has the means at its disposal to raise enough revenue through taxes other than the income tax to satisfy its enormous greed. But, like so

the Income Tax was not instituted in order to give the Federal Government more revenue. It was established in order to give the Government more power.

many other government programs, the Income Tax was not instituted in order to give the Federal Government more revenue. It was established in order to give the Government more power.

Do you want to control the people? Tell them that carbon dioxide is destroying the planet, and that you have the solution for CO2 reduction. Do you want to keep the minions dependent on the government teat? Involve them in needless wars for oil and entertain them with modern-day bread and circuses while other nations surpass us in the development of alternative energy technologies. Do you want to teach hatred by putting foremost in your subjects' minds that someone else is not paying their fair share? Then by all means, institute a graduated income tax.

In addition to inspiring class warfare and hatred, the income tax has always provided incentives so perverse that they consistently warp and destroy what would otherwise be a healthy economy. Instead of encouraging Americans to live within their means, including saving significant portions of their income to be utilized for economic investment, the federal income tax code encourages Americans to buy homes that they cannot afford while discouraging savings and other investments through the levying of taxes against earned interest.

Congressman Ron Paul reminds us that we once did just fine without an income tax.
Could America exist without an income tax? The idea seems radical, yet in truth America did just fine without a federal income tax for the first 126 years of its history. Prior to 1913, the government operated with revenues raised through tariffs, excise taxes, and property taxes, without ever touching a worker’s paycheck.
He also points out that removing all income tax revenues would only mean that government would need to return to the size that it was in the 1990's:
[We] don't need an income tax to fund the important functions of the federal government. You may be surprised to know that the income tax accounts for only approximately one-third of federal revenue. Only 10 years ago, the federal budget was roughly one-third less than it is today. Surely we could find ways to cut spending back to 1990 levels...
Most people don't think about the largely unseen consequences of the income tax, but Congressman Paul makes them easy for us to understand:
The harmful effects of the income tax are obvious. First and foremost, it has enabled government to expand far beyond its proper constitutional limits, regulating virtually every aspect of our lives. It has destroy[ed] our privacy in the process. It takes billions of dollars out of the legitimate private economy... This economic drain destroys jobs and penalizes productive behavior.
The income tax is one weapon by which the elite are destroying America.

Put this arrow in your "litmus test" quiver. There are

Do you want to teach hatred by putting foremost in your subjects' minds that someone else is not paying their fair share? Then by all means, institute a graduated income tax.

just a few important questions whose answers you need to know about the candidates you will vote for or against for federal office. One of these questions is whether the candidate is in favor of abolishing the hate-inducing federal income tax. If he or she is not, he or she is not worthy of federal office.

There are far better ways to collect the kinds of taxes that Federal Government needs in order to perform its operations. But there is no better way to pit Americans against Americans in vile class hatred than to require them to pay arbitrarily different amounts of money in taxes. If you understand this one fact about the income tax, then everything else about how wrong it is will make sense to you.

As you think more and more about the genuine lunacy that is the federal income tax, you will develop in your mind an urgency to have the federal income tax amendment repealed. It's not going to happen overnight. But if you want the America back that once was, it's got to happen sometime.



Thursday, July 16, 2009

"We" Were Not Wrong. The Global Warming Inquisition Just Might Be Over.

A recent article on USA Today asks: Could We Be Wrong About Global Warming? The answer? It depends on the meaning of the word "we".

True science has always been about the free flow of ideas. Today's so-called "science" of global warming has, however, come to more and more closely resemble the Inquisition of the Middle Ages. Fortunately, as more and more scientists rise above the crowd of politically motivated pseudo-scientific sheep to demonstrate what science--unaffected by politics--really points to, we may have happily avoided a modern-day Global Warming Inquisition.

If, like me, you belong to the side of the debate that is open to the free flow of ideas, then you can confidently say that "we" were not wrong.

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To the Spanish Inquisitors, everything was settled. A consensus had been reached. If someone violated the consensus, they stood to forfeit much of their property, and they might perhaps have been thrown in prison. As the Inquisition gathered steam, those who were found on the wrong side of the consensus suffered torture and often even death. Thankfully, the heavy handed side of the modern global warming debate has not progressed that far yet, but given time...who knows?

USA Today's Science Fair blog points out what many of us who take our science straight (i.e. not having been diluted by the cream and sugar of politics) have known for quite some time:
Could the best climate models -- the ones used to predict global warming -- all be wrong?

Maybe so, says a new study published online today in the journal Nature Geoscience. The report found that only about half of the warming that occurred during a natural climate change 55 million years ago can be explained by excess carbon dioxide in the atmosphere. What caused the remainder of the warming is a mystery.

"In a nutshell, theoretical models cannot explain what we observe in the geological record," says oceanographer Gerald Dickens, study co-author and professor of Earth Science at Rice University in Houston. "There appears to be something fundamentally wrong with the way temperature and carbon are linked in climate models."
USA Today's blog article provocatively entitled "Could We Be Wrong About Global Warming?" I know what the article meant by stating "we" in the universal collective sense, but it is critical to remember that the "we" that really matters--the ones who prize science over politics--have NOT been wrong on the subject of how carbon and temperature are linked.

I've just begun reading the book The Inquisition: The Reign of Fear by Toby Green, which has opened up a surprising new vista to me. The infallible Inquisitors of yesteryear so closely resemble the upper crusts of the Green movement of today that it is shocking. But with USA Today asking the question, "Could We Be Wrong About Global Warming?" we have hopefully avoided the point at which the modern-day Global Warming Inquisition would have reached the superstitious heights achieved by its medieval predecessor. Here, from Toby Green's book is a description so hauntingly familiar as to nearly trigger a case of deja vu:
[The Inquisition] touched every aspect of society; people attending church had to look suitably devout... A secret police and a thought police, the Inquisition produced a permanent state of fear and invented an atmosphere of paranoia and institutional persecution that created a precedent for totalitarianism.
Meanwhile, the Inquisitors themselves were completely above the law, being well-known thieves and in many cases flaunting their adulterous affairs in public.

Sound familiar? Let's hope that we can avoid a redux.

I can hear it already: 'No article, including this one, which conflicts with the global warming consensus, has been properly peer reviewed.' Interestingly, during the Spanish Inquisition, the list of proper peer reviewers was purposely small.

As true science overwhelms the would-be Torquemadas of the 21st Century, perhaps we have avoided the onset of a 21st-century Environmental Inquisition. Yet the prize for the fascistic Inquisitors of the modern day is still monumental. Therefore, we have no time to rest on our laurels.



Wednesday, July 15, 2009

Deregulation by Democrats Responsible for Obscene Wall Street Profits

Democrats are very quick to accuse Republicans of the sort of deregulation that creates crises on Wall Street. They're correct. However, Democrats themselves have been guilty of the same immoral sorts of deregulation. It was the Bill Clinton administration that made it possible for some Wall Street tycoons to make it rich in the financial markets at the same time that you and I are losing our shirts.

How can Goldman Sachs be increasing profits by over half when yours and my 401k plans are floundering? Because of deregulation by Democrats.

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Former Treasury Secretary Henry Paulson is also a former CEO

My greatest worry during the current barrage of revelations regarding Goldman Sachs' chicanery is that we'll take our eye off the juiciest target--the Federal Reserve. But hopefully that won't be too difficult now Goldman and the Fed are two whores in the same bed.

of Goldman Sachs. In 2008, when Lehman brothers--a strong rival to Goldman Sachs--asked to become a "bank holding company", Paulson denied the request. Lehman went the way of the dinosaur. As TruthDig reports:
...soon afterward, Goldman was granted just such a deal, worth a quick $10 billion. Much is now made of Goldman paying back part of its bailout money, but forgotten is the $12.9 billion that Goldman got as its cut of the $180 billion AIG payoff. That is money that will not be paid back.
In other words, that is money that Goldman can now declare as profit. Nifty!!

Henry Paulson is a criminal. But he didn't get that way all by himself. He got that way with several other criminals, one of whom, Robert Rubin, is also a former U.S. Treasury Secretary, and is also a former CEO of...you guessed it.
Goldman was not just another bank. Before Paulson ran the Treasury Department, another former Goldman head, Robert Rubin, pushed through the repeal of the Glass-Steagall controls on banking activity.
Glass-Steagall made it so that, among other things, Goldman Sachs could not become a bank holding company. Treasury Secretary and former Goldman CEO Robert Rubin carefully pushed the Gramm-Leach-Bliley Act through Congress in 1999--which repealed Glass-Steagall--with the help of a lot of elite Republicans and Democrats.

In questioning the propriety of the November 2008 bailout, which wouldn't have been nearly so simple without Rubin's having paved the way, TruthDig wonders:
Why didn’t the federal government just lend the money to the states? Why was all the money thrown at Wall Street instead of needy homeowners or struggling school systems? Because the federal government works for Goldman and not for us. Indeed, when it comes to the banking bailout, Goldman Sachs is the government.
It gets worse. On his show yesterday, Glenn Beck gives details as to just how adulterous is the affair between Goldman Sachs and government:
Then the former Goldman Sachs employee, now treasury secretary Paulson says we've got to appoint somebody to really oversee and design this TARP thing; who could I get, who could I get, who could I you know what? I'm going to hire somebody from Goldman Sachs. He will design TARP. At the same time Goldman Sachs calls their former employee who is now designing TARP and their former employee who's now the treasury secretary and says, you know what, we should be a bank holding company. A bank holding company? What? Are you kidding me? In the coming months that will take GE almost two days to have that happen. What, are you crazy? Wal Mart's been trying for years! "Okay, we'll do it." So the two former employees from Goldman Sachs now allow Goldman Sachs to be a bank holding company. Well, why would they want to be a bank holding company? Well, now they can get even more funds from the government. They cannot only get the TARP funds but they can also get FDIC funds. Oh, and there's also this other little pesky thing. The SEC, the SEC doesn't oversee bank holding companies. The Federal Reserve oversees a bank holding company as long as it's the Federal Reserve where what town is Goldman Sachs? Oh, New York? Yeah. So you'll be overseen by the Federal Reserve chairman of New York who, oh, my gosh, what a coincidence! He's on your board of directors!
I'm not clear as to whether Beck is referring to Timothy Geithner in his monologue,

Geithner may not have been a Goldman employee, but he was the head of the New York Federal Reserve branch, and he was deeply involved with Henry Paulson in killing Bear Stearns and throwing its cement-booted corpse into the East River.

but Geithner was the head of the New York Federal Reserve branch, and he was deeply involved with Henry Paulson in killing Bear Stearns and throwing its cement-booted corpse into the East River.

My greatest worry during the current barrage of revelations of Goldman Sachs' chicanery is that we'll take our eye off the juiciest target--the Federal Reserve. But hopefully that won't be too difficult now Goldman and the Fed are two whores in the same bed.

As I have said before, the problem is not Republican vs. Democrat. It doesn't matter which party someone comes from. It matters if they have become entrenched in the gross immorality of the American elite.

Elite Republicans will screw you every chance they get. So will

Goldman Sachs is only the latest and most virulent evidence of what we get when we paint ourselves into the "lesser of two evils" box.

elite Democrats. Which is why it was a catastrophe to elect Barack Obama president. Which is also why it would have been equally catastrophic to have elected John McCain president.

Goldman Sachs is only the latest and most virulent evidence of what we get when we paint ourselves into the "lesser of two evils" box.



Saturday, July 11, 2009

Health Care: Do You Prefer Single-Payer Bureaucracy or Profligate Greed?

What's worse, having a government bureaucrat between you and proper health care, or having a corporate bureaucrat? When health insurance companies' allegiances shift away from people who need health care and toward pleasing their investors, you get the kinds of runaway health care costs that we have in the United States today. In a day of rampant greed and immorality, I don't hold out much hope that a government directed, single-payer health care plan will be any better than what we currently have, but I'm starting to think that it couldn't be worse, either.

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Have your costs for health care seemed to outpace your standard of living over the last decade or more? There are several contributing reasons, but one of the greatest is that greed for profit has seeped into the health insurance industry until it has become a flood.

Medical loss ratios measure how much insurance companies lose to administrative costs. In the 1990's 95% of costs paid for actutal health care in early 1990's, so the medical loss ratio was only about 5%. These ratios have risen until now nearly 20% of insurance premiums go to cover administrative costs. With some individual companies, the administrative excess is nearing 25%. In contrast, according to Wendell Potter, who was an executive at CIGNA insurance for 15 years, medicare has only 3% administrative overhead costs. Mr. Potter, who spoke with Bill Moyers recently, left CIGNA after his guilt got the best of him.

In days gone by, Potter told Moyers, health insurers cared most about those they insured. Now, they care most about their bottom line. Trimming true insurance in order to appease shareholders and to pay out gigantic bonuses to executives has begun to ruin not only these companies but also health care in America. Investors in health insurance stocks have primarily become large institutions, to include major, demanding hedge funds. Insurers often feel intense heat from such investors, who think they have not denied enough claims. It is becoming standard fare for insurers, bowing to these investors, to raise premiums so high that employers can no longer afford to insure their employees, or the insurers simply drop large groups of policy holders outright. The cancer that is destroying Wall Street is bringing the health industry down with it.

The main problem, however, is not that health insurers are greedy. The main problem is that so are most politicians. The solution, therefore, can not be simply to turn the reins of health care over to government. The solution has to be for Americans to stop being dictated to by their elite overlords, but rather to demand fairness and integrity. We should demand insurance only from companies that care about people instead of profits. And in order to get the health care regulation that we need, we should sweep the floor of congress clean with the broom of any angry vote.

Neither single-payer health insurance, nor any other form of social direction of health care dollars will work any better than the debauchery that exists in the America's private health insurance industry. Honesty and integrity are our only hope.



Thursday, July 09, 2009

Should We Investigate the BCS or the Theft of the Goldman Sachs "Doomsday Machine"?

While Orrin Hatch is busy being worried about the unfairness of college football's Bowl Championship Series, Wall Street poster child Goldman Sachs has admitted that special "program trading" software that allowed it to manipulate the financial markets has been stolen, which is ironically proof that Goldman Sachs has been engaging in highly criminal behavior.

Bernard Madoff needs someone to keep him company in his prison cell, and Goldman Sachs would be a good place to start the search to find a whole bunch of those someones.

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When the whistle was blown on Bernie Madoff several months ago, the Securities and Exchange Commission and everyone else who knew what was going on turned the other way and ignored the problem. Now, when the ability to bring world financial markets to their knees has been released through theft to the world--the United States Senate is debating whether the Bowl Championship Series is fair or not.

According to the July 8th, 2009 edition of the radio program "What Really Happened", Goldman Sachs has, since the Clinton administration, been part of the Plunge Protection Team. Whenever the stock market is on the ropes, the Plunge Protection Team magically--behind the scenes, and usually near the end of the day--props up those falling markets. According to DailyKos, Goldman is currently the only participant in this "Supplemental Liquidity Provider" program.

Bloomberg reported today
that:
[Sergey] Aleynikov, 39, is the former Goldman computer programmer who was arrested on theft charges July 3 as he stepped off a flight at Liberty International Airport in Newark, New Jersey. That was two days after Goldman told the government he had stolen its secret, rapid-fire, stock- and commodities-trading software in early June during his last week as a Goldman employee. Prosecutors say Aleynikov uploaded the program code to an unidentified Web site server in Germany.
It also reports Goldman's dire fear of what could happen if the software falls into the wrong hands:
The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways.
It already has been used to manipulate the markets in unfair ways, Goldman Sachs. You were using it.

Goldman's primary concern seems to be that someone besides them can now "use it to manipulate the markets in unfair ways." Under normal circumstances, Goldman executives would be worrying about prison time. Remarkably, they don't indicate any of that sort of worry whatsoever.

Bernie Madoff is lonely.

But Orrin Hatch and the rest of the U.S. Senate are worried that USC made more money at their college bowl game last year than Brigham Young University did.



Sunday, July 05, 2009

A Fourth of July Travel Tour of Bonfires and Illuminations

How was your 4th of July? I'm sure you regularly attend some sort of patriotic service on the 4th of July. I do, too. This time, though, I celebrated with my family in a different way. While traveling home from Canada, it was gratifying to make it back to the American homeland in time for a plethora of fireworks shows in the night sky to light our road home. The united devotions along our path reminded me of the "bonfires and illuminations" of which John Adams prophesied 233 years ago. Our fireworks celebrations still show that, although America may be a bit tattered and torn of late, her genius lives on.

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Not long after we dropped through the Canadian border at

Last night, as we drove down Highway 93, a panoramic pattern of American devotion unfolded before our eyes. No matter in which which nook or cranny of the country you find yourself, it's easy to observe the love of liberty that is the common thread among Americans of every stripe.

Roosville on Highway 93, we were treated to a nearly non-stop fireworks display as we wended our way south. From the small to the great, fireworks illuminated our path from Whitefish, Montana all the way to our midnight stopover point in Misoula. Particularly well put together were the fireworks shows at Flathead Lake. Families and friends congregated along the roadways, on the bridges, and in the harbors from miles around to pay tribute to their indomitable country with hot-dog roasting fires and the bombs of fireworks bursting in air.

As we drove along it occurred to me that this must have been exactly what John Adams had envisioned when he prophesied that the coming forth of the Declaration of Independence would be
...celebrated by succeeding generations as the great anniversary festival. It ought to be celebrated by pomp and parade, with shows, games, sports, guns, bells, bonfires, and illuminations from one end of this continent to the other...
It's thrilling enough to be anchored in one place as one group of Americans pay their tribute to liberty and the freedom to choose. But last night, as we drove along Highway 93, a panoramic pattern of American devotion unfolded before our eyes. No matter in which which nook or cranny of the country you find yourself, it's easy to observe the love of liberty that is the common thread among Americans of every stripe.

America may at present be an economic tinderbox, but the roots of our heritage planted by our American forbears will eventually provide the nourishment of a renewed flowering of the American landscape with the greatnesses of our past--humility, liberty, and prosperity.

America's government may have gotten fat on playing the imperialistic overlord, but her people

No matter how defiantly the forces of calumny may combine against the greatest country on earth, two hundred and thirty three years of liberty will yet prove an impossible habit to break.

are gradually coming to terms with the understanding that the real essence of American genius can be found only in setting the example of liberty and not in the force of arms.

We may have become confused and lost our way in a morass of soul-destroying government social programs, but the continuing bursts that illuminate our twenty-first century silhouette our lost and distant path just enough that I am confident we can find it once again.

America's image is tattered and torn, for sure. But at least once a year Americans all across the fruited plain remind themselves that America was once--and has the ability once again to be--the beacon of liberty.

"Independence now, and independence forever." Those words were also uttered by John Adams. Despite a foreign policy ironically destructive of freedom, the unfounded fears of man-made global warming, mountains of man-made debt, and the pitting by government of class against class, I am confident that "independence forever" is what we and our posterity will enjoy.

No matter how defiantly the forces of calumny may combine against the greatest country on earth, two hundred and thirty three years of liberty will yet prove an impossible habit to break.


Thursday, July 02, 2009

"Animal Spirits" or Government Failure: Which Causes Economic Panic?

Those who subscribe to the economic theories of John Maynard Keynes believe that it is the "animal spirits" that reside in people that cause economic manias and panics. They're partly right. Classical economists believe that government mismanagement causes them. They're right, too. It's not hard to figure out which one is the most right, though. Too bad the Keynesians still cling to their disproven theories and ignore the inconvenient facts that have disproved them.

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In their book Animal Spirits: Why Human Psychology Drives the Economy and Why It Matters for Global Capitalism, authors George Akerlof and Robert Shiller resurrect an interesting concept that was first observed by John Maynard Keynes--that people have "animal spirits" that cause them to act in abnormal, non-economic ways.

The concept of animal spirits is a valuable contribution to the understanding of economics, because people sometimes do not act rationally. Although they may often act in ways that

Akerlof and Shiller's Animal Spirits makes an important contribution to the economic debate. Unfortunately, they spend the entirety of the book's 176 pages avoiding the fact that central banks have consistently been the fuel that have turned the flames of mass mania and panic into bonfires of destruction.

resemble "an invisible hand" that works toward the mutual benefit of society, as Adam Smith observed, sometimes they do not. Classical economists don't seem to take these episodes of irrational behavior into account as often as they should.

"People are not always rational in pursuit of their economic interests," say Akerlof and Shiller. That is a true statement.

"In Keynes' view," the authors say, "these animal spirits are the main cause why the economy fluctuates as it does." Oops! That is, inconveniently to Akerlof, Shiller, and all other Keynesians, a demonstrably false statement.

In his book, Meltdown, Thomas Woods, Jr. points out that manias and panics don't just happen on their own.
...describing something as a "mania" is no explanation at all, and that only expansionary monetary policy by the central bank can account for these phenomena:

If you investigate individually the manias that the market has so dubbed over the years, in every case, it was expansive monetary policy that generated the boom in an asset. The particular asset varied from one boom to another. But the basic underlying propagator was too-easy monetary policy and too-low interest rates that induced ordinary people to say, well, it's so cheap to acquire whatever is the object of desire in an asset boom, and go ahead and acquire that object. And then of course if monetary policy tightens, the boom collapses.

In order for a mania-driven boom to persist, there would have to be an increasing supply of credit to fund it.
Akerlof and Shiller's Animal Spirits makes an important contribution to the economic debate. Unfortunately, they spend the entirety of the book's 176 pages avoiding the fact that central banks have consistently been the fuel that have turned the flames of mass mania and panic into bonfires of economic destruction.

Yes, people do have animal spirits. But only government can give license to the collective animal spirit to such an extent that manias can turn into economic bubbles and subsequent full-fledged panics. The economic meltdown of 2008-09 is only the latest evidence of that.

Keynesian economics is not a complete waste of time. But it's important to understand that his theories have their certain limits.



Wednesday, July 01, 2009

America Continues to Build Up Its Supply of Enemies

If you thought that America's foreign policy outlook would improve with the election of Barack Obama, you thought wrong. Part of the problem, being residual blowback from previous American sins, is, admittedly, not Obama's fault. But a great deal of it is.

When Establishment candidates are elected one right after the other, you should expect that U.S. foreign policy will continue to be inane. And you should expect that more and more of the world will have reason to hate us.

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At exactly the time American troops are pulling back from the cities in Iraq, new revelations of old torture are giving Iraqis another perfectly good reason to hate everything that is American. As if their enmity were not enough, deaths of scores of civilians in Pakistan at the hands of remote-piloted U.S. airplanes are ensuring another bumper crop of American enemies.

With the advent of high technology, virtually every person in the world knows about yet additional episodes of American perfidy on President Barack Obama's watch.

Is someone choreographing this? We can't be this stupid.

Iraqi Crucifixion. At a press conference day before yesterday, it was noted in an off-hand sort of manner that at least one Iraqi prisoner in abu Ghraib prison was crucified. The one crucifixion that we know about, and just now coming to light, happened in November of 2003.
Among the more startling revelations during the press conference today was an article describing how a detainee in Iraq had been "essentially crucified" during CIA interrogation.

According to a June 22 article in The New Yorker magazine, cited during the press conference today, an Iraqi prisoner in US custody was crucified - dying from asphyxiation while hanging from his arms during a CIA interrogation.

"An Iraqi prisoner named Manadel al-Jamadi died on November 4, 2003, while being interrogated by the C.I.A. at Abu Ghraib prison, outside Baghdad," the New Yorker's Jane Meyer wrote. "A forensic examiner found that he had essentially been crucified; he died from asphyxiation after having been hung by his arms, in a hood, and suffering broken ribs. Military pathologists classified the case a homicide."
What's even worse:
No charges have been sought against the interrogators from the CIA who participated in the death of al-Jamadi or CIA officers involved in other cases.
Pakistan Condemns U.S. Attacks. It is "conventional wisdom" that the American military is not operating in Pakistan. Oh, but it is. So far it's (allegedly) only from the sky, but Pakistanis are quite clear as to the concept of American air superiority. When an aerial bomb kills dozens of civilians at a Pakistani funeral, everyone knows whodunnit. Pakistanis are incensed.
Pakistan, on Thursday strongly condemned American drone attacks...

The protest comes two a days after 80 people were killed and a large number of them sustained multiple injuries in the US drone attack in South Waziristan Agency.

What appeared to be the deadliest U.S. missile attack ever on Pakistani soil brought an unusual reaction since the fresh drone attack on Tuesday in a country that has previously denounced such strikes as an affront to its sovereignty.

The drone attacks have sparked anger among the masses and it took the people to streets in big cities like Lahore and Karachi where they condemned such attacks asking government to get stop such attacks that were proving to be lethal for innocent people of Pakistan.
America was never meant to be the world's ogre. Instead we should be the world's example.

Why don't we start electing people that understand that fundamental premise?