Yesterday, 5/15/2009, Ron Paul appeared on Morning Joe and discussed the pros of Austrian economics vs. the cons of Keynesian economics.
Here's the video.
My only problem here is how Ron Paul doesn't give the Gold Anti-Trust Action Committee a shout-out! Is he not aware of them? He was re-elected to Congress in 1997. Being a member of the Oversight Committees, he would've received a copy of their book, Gold Derivative Banking Crisis.
Come on, Ron. You're the man! Speak up!
Showing posts with label austrian economics. Show all posts
Showing posts with label austrian economics. Show all posts
Saturday, May 16, 2009
Friday, March 20, 2009
Freedom Watch and InfoWars Simulcast!
Something unique, a first of firsts, FoxNews has simulcasted with InfoWars.
A word about Alex Jones. I don't like to rely on just him. He's a good source but like any news outlet don't take everything you hear for granted. Do your own research. Find out what the debunkers have to say. Check other sources like Daryl Bradford Smith. Eustace Mullins is a VERY GOOD SOURCE, probably the best. He was Senator McCarthy's research assistant when The Good Senator was fighting his war against World Communism. And he also, under the tutelage of political prisoner Ezra Pound, produced his best work, the book on the Fed of which I have reproduced the first chapter of for this blog. And I'll continue posting it in pieces.
One of the reasons I don't trust Alex Jones is that he had Eustace Mullins on his radio program once, and never again. Eustace appeared on Morton Downey, Jr's television talk show and afterwards the sponspors pulled their support and Downey's talk show was brought to its end.
Here's the clip. There's six parts. Here's the YouTube link
A word about Alex Jones. I don't like to rely on just him. He's a good source but like any news outlet don't take everything you hear for granted. Do your own research. Find out what the debunkers have to say. Check other sources like Daryl Bradford Smith. Eustace Mullins is a VERY GOOD SOURCE, probably the best. He was Senator McCarthy's research assistant when The Good Senator was fighting his war against World Communism. And he also, under the tutelage of political prisoner Ezra Pound, produced his best work, the book on the Fed of which I have reproduced the first chapter of for this blog. And I'll continue posting it in pieces.
One of the reasons I don't trust Alex Jones is that he had Eustace Mullins on his radio program once, and never again. Eustace appeared on Morton Downey, Jr's television talk show and afterwards the sponspors pulled their support and Downey's talk show was brought to its end.
Here's the clip. There's six parts. Here's the YouTube link
Sunday, March 1, 2009
New York Times Falsifies History of Federal Reserve
http://www.americanfreepress.net/html/new_york_times_falsifies_169.html
By Michael Collins Piper
The New York Times published a flat-out untruth on Feb. 7 about the Federal Reserve Act of 1913. And the untruth came from the pen of a distinguished American academic who is author of many much-touted works of history.
In a commentary in the Times, entitled “The Value of Other People’s Money,” Dr. Melvin I. Urofsky, a professor at Virginia Commonwealth University, reflected on the origins of the congressional measure that created the Federal Reserve System. He said that the measure “allowed Congress to take away banks’ control over currency.” In fact, nothing could be further from the truth.
Dr. Urofsky was dead wrong. The New York Times was guilty of perpetrating a falsehood, something which should come as no surprise, considering the fact that The New York Times—which fancies itself America’s newspaper of record—has long been the daily media voice in the United States of the international banking dynasties that control the American money system through their domination of the Fed.
The truth about the nature of the Fed is no secret to Americans who have access to independent newspapers such as AMERICAN FREE PRESS, historical journals such as THE BARNES REVIEW and radio outlets such as Republic Broadcasting (which can be found on the Internet at republicbroadcasting.org).
In fact, as far back as the 1920s, the great American industrialist Henry Ford was warning Americans of the venal nature of the Fed and the plutocratic money masters who created the Fed and who controlled it then as they do today. Ford wrote:
What the people of the United States do not understand and never have understood is that while the Federal Reserve Act was governmental, the whole Federal Reserve System is private. It is an officially created private banking system.
Examine the first 1,000 people you meet on the street, and 999 of them will tell you that the Federal Reserve System is a device whereby the United States government went into the banking business for the benefit of the people. They have an idea that like the Post Office and the Custom House the Federal Reserve is part of the government’s official machinery. . . .
Take up the standard encyclopedias and while you will find no misstatements of fact in them, you will find no statement that the Federal Reserve System is a private banking system; the impression carried away by the lay reader is that it is a part of the government.
The Federal Reserve System is a system of private banks, the creation of a banking aristocracy within an already existing system of aristocracy, whereby a great proportion of banking independence was lost, and whereby it was made possible for speculative financiers to centralize great sums of money for their own purposes, beneficial [to the people of the United States] or not.
In addition, while there has been much written on the Federal Reserve and the reality of what it constitutes— a privately owned and privately controlled money monopoly in the hands of banking institutions—the fact that the Rothschild family of Europe was, ultimately, the primary force behind the establishment of the system on American soil, is not something that is fully understood.
For example, because there were no people named “Rothschild” at the famous meeting off the coast of Georgia at Jekyll Island where the framework for the Federal Reserve was put forth and where the planning for the Federal Reserve Act of 1913 established the Fed, there are those who would divorce the Rothschild family altogether from the circumstances. However, the fine hand of Rothschild was indeed on the scene, represented by Paul Warburg of the New York-based Kuhn, Loeb Company, which was under the control of longtime Rothschild associate Jacob Schiff.
Despite all of this very clear history—which has been outlined by numerous authors such as Wyckliffe Vennard, Eustace Mullins, and Dr. Martin Larson, the preeminent among them—modern-day media propagandists (and we must include the aforementioned Dr. Melvin I. Urofsky among them)—continue to present the Fed as precisely the opposite of what it really is. That Urofsky is assisting in the perpetration of the fraud is particularly egregious in light of the fact that he is a much-published author of such volumes as:
� American Zionism from Herzl to the Holocaust;
�We are One!: American Jewry and Israel;
� Commonwealth and Community: The Jewish Experience in Virginia;
� Documents of American Constitutional and Legal History; and
� A March of Liberty: A Constitutional History of the United States.
And these are just a few of the works to which Urofsky has added his name. Those who wish to contact Urofsky and provide him factual information about the Federal Reserve System (of which he is apparently unaware) may contact him by email at murofsky@vcu.edu or write: Dr. Melvin Urof sky, 919 W. Franklin Street, Richmond, Va. 23220.
By Michael Collins Piper
The New York Times published a flat-out untruth on Feb. 7 about the Federal Reserve Act of 1913. And the untruth came from the pen of a distinguished American academic who is author of many much-touted works of history.
In a commentary in the Times, entitled “The Value of Other People’s Money,” Dr. Melvin I. Urofsky, a professor at Virginia Commonwealth University, reflected on the origins of the congressional measure that created the Federal Reserve System. He said that the measure “allowed Congress to take away banks’ control over currency.” In fact, nothing could be further from the truth.
Dr. Urofsky was dead wrong. The New York Times was guilty of perpetrating a falsehood, something which should come as no surprise, considering the fact that The New York Times—which fancies itself America’s newspaper of record—has long been the daily media voice in the United States of the international banking dynasties that control the American money system through their domination of the Fed.
The truth about the nature of the Fed is no secret to Americans who have access to independent newspapers such as AMERICAN FREE PRESS, historical journals such as THE BARNES REVIEW and radio outlets such as Republic Broadcasting (which can be found on the Internet at republicbroadcasting.org).
In fact, as far back as the 1920s, the great American industrialist Henry Ford was warning Americans of the venal nature of the Fed and the plutocratic money masters who created the Fed and who controlled it then as they do today. Ford wrote:
What the people of the United States do not understand and never have understood is that while the Federal Reserve Act was governmental, the whole Federal Reserve System is private. It is an officially created private banking system.
Examine the first 1,000 people you meet on the street, and 999 of them will tell you that the Federal Reserve System is a device whereby the United States government went into the banking business for the benefit of the people. They have an idea that like the Post Office and the Custom House the Federal Reserve is part of the government’s official machinery. . . .
Take up the standard encyclopedias and while you will find no misstatements of fact in them, you will find no statement that the Federal Reserve System is a private banking system; the impression carried away by the lay reader is that it is a part of the government.
The Federal Reserve System is a system of private banks, the creation of a banking aristocracy within an already existing system of aristocracy, whereby a great proportion of banking independence was lost, and whereby it was made possible for speculative financiers to centralize great sums of money for their own purposes, beneficial [to the people of the United States] or not.
In addition, while there has been much written on the Federal Reserve and the reality of what it constitutes— a privately owned and privately controlled money monopoly in the hands of banking institutions—the fact that the Rothschild family of Europe was, ultimately, the primary force behind the establishment of the system on American soil, is not something that is fully understood.
For example, because there were no people named “Rothschild” at the famous meeting off the coast of Georgia at Jekyll Island where the framework for the Federal Reserve was put forth and where the planning for the Federal Reserve Act of 1913 established the Fed, there are those who would divorce the Rothschild family altogether from the circumstances. However, the fine hand of Rothschild was indeed on the scene, represented by Paul Warburg of the New York-based Kuhn, Loeb Company, which was under the control of longtime Rothschild associate Jacob Schiff.
Despite all of this very clear history—which has been outlined by numerous authors such as Wyckliffe Vennard, Eustace Mullins, and Dr. Martin Larson, the preeminent among them—modern-day media propagandists (and we must include the aforementioned Dr. Melvin I. Urofsky among them)—continue to present the Fed as precisely the opposite of what it really is. That Urofsky is assisting in the perpetration of the fraud is particularly egregious in light of the fact that he is a much-published author of such volumes as:
� American Zionism from Herzl to the Holocaust;
�We are One!: American Jewry and Israel;
� Commonwealth and Community: The Jewish Experience in Virginia;
� Documents of American Constitutional and Legal History; and
� A March of Liberty: A Constitutional History of the United States.
And these are just a few of the works to which Urofsky has added his name. Those who wish to contact Urofsky and provide him factual information about the Federal Reserve System (of which he is apparently unaware) may contact him by email at murofsky@vcu.edu or write: Dr. Melvin Urof sky, 919 W. Franklin Street, Richmond, Va. 23220.
Wednesday, February 11, 2009
Congressman Michael Capuano Launches Tirade Against Bank CEOs
It's been my firm belief that the Wall Street Gang should be prosecuted to the fullest extent of the law for what they've been doing in the markets for the past fifteen years, interrupting the natural flow of the free market in the manner that has been executed. I wouldn't mind if they served life sentences and perhaps even received the death penalty. A person has to be pretty pissed off at someone for a want of the death penalty when that person is naturally against such a penalty.
These people are parasites, the ones who lobby for the close business relationship between bank and government seeking out the mutual benefits that occurs from such a relationship.
The CEOs of the banks appeared before the House Financial Service Committee today and Jesse makes a very good point over at his own blog that I feel I wanted to bring to the attention of this blog. The Democrat from Massachusetts, Michael Capuano was possibly the highlight of the day when he appropriately railed against these mother fucking bastards.
As much as I love Ron Paul and his idiosyncratic way of waxing philosophic, branching off into soliloquies as he does so many times, I wish he would be more aggressive towards the Fed and Wall Street like Congressman Louis. T. McFadden.
These people are parasites, the ones who lobby for the close business relationship between bank and government seeking out the mutual benefits that occurs from such a relationship.
The CEOs of the banks appeared before the House Financial Service Committee today and Jesse makes a very good point over at his own blog that I feel I wanted to bring to the attention of this blog. The Democrat from Massachusetts, Michael Capuano was possibly the highlight of the day when he appropriately railed against these mother fucking bastards.
As much as I love Ron Paul and his idiosyncratic way of waxing philosophic, branching off into soliloquies as he does so many times, I wish he would be more aggressive towards the Fed and Wall Street like Congressman Louis. T. McFadden.
Thursday, February 5, 2009
The Federal Reserve Board Abolition Act
The Honorable Congressman Ron Paul's legislation piece, The Federal Reserve Board Abolition Act, can be accessed here. You can read a summary of the Act and you can also read the Act as well as download a PDF file version of it.
I don't expect this will receive much attention except from perhaps Congressman Dennis Kucinich (D-OH).
The Democrats have control of the House. Will they prove their rhetoric and support dismantling the bankers' cabal? Or is their supposed "hatred of capitalism" a smoke & mirrors ruse?
Before the US House of Representatives, February 4, 2009, introducing the The Federal Reserve Board Abolition Act, H.R. 833.
I don't expect this will receive much attention except from perhaps Congressman Dennis Kucinich (D-OH).
The Democrats have control of the House. Will they prove their rhetoric and support dismantling the bankers' cabal? Or is their supposed "hatred of capitalism" a smoke & mirrors ruse?
Before the US House of Representatives, February 4, 2009, introducing the The Federal Reserve Board Abolition Act, H.R. 833.
Madame Speaker, I rise to introduce legislation to restore financial stability to America's economy by abolishing the Federal Reserve. Since the creation of the Federal Reserve, middle and working-class Americans have been victimized by a boom-and-bust monetary policy. In addition, most Americans have suffered a steadily eroding purchasing power because of the Federal Reserve's inflationary policies. This represents a real, if hidden, tax imposed on the American people.
From the Great Depression, to the stagflation of the seventies, to the current economic crisis caused by the housing bubble, every economic downturn suffered by this country over the past century can be traced to Federal Reserve policy. The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial "boom" followed by a recession or depression when the Fed-created bubble bursts.
With a stable currency, American exporters will no longer be held hostage to an erratic monetary policy. Stabilizing the currency will also give Americans new incentives to save as they will no longer have to fear inflation eroding their savings. Those members concerned about increasing America's exports or the low rate of savings should be enthusiastic supporters of this legislation.
Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy. The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy. Federal Reserve policies also benefit big spending politicians who use the inflated currency created by the Fed to hide the true costs of the welfare-warfare state. It is time for Congress to put the interests of the American people ahead of special interests and their own appetite for big government.
Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy. The United States Constitution grants to Congress the authority to coin money and regulate the value of the currency. The Constitution does not give Congress the authority to delegate control over monetary policy to a central bank. Furthermore, the Constitution certainly does not empower the federal government to erode the American standard of living via an inflationary monetary policy.
In fact, Congress' constitutional mandate regarding monetary policy should only permit currency backed by stable commodities such as silver and gold to be used as legal tender. Therefore, abolishing the Federal Reserve and returning to a constitutional system will enable America to return to the type of monetary system envisioned by our nation's founders: one where the value of money is consistent because it is tied to a commodity such as gold. Such a monetary system is the basis of a true free-market economy.
In conclusion, Mr. Speaker, I urge my colleagues to stand up for working Americans by putting an end to the manipulation of the money supply which erodes Americans' standard of living, enlarges big government, and enriches well-connected elites, by cosponsoring my legislation to abolish the Federal Reserve.
Monday, February 2, 2009
Ron Paul Grills Fed Governor 1/13/09
I'm usually pretty good at keeping abreast with The Good Doctor. This one slipped under my radar.
I do have a tendency to hesitate to post videos because not everyone has a high speed internet connection. I think it's important for the readers of this blog to get as much information out of this as they can.
The important section of the video comes at the end.
I wanted to transcribe the most important part.
Hon. Paul: ....you give us the kind of information that you want us to have. I've been on the Financial Services Committee for a long time, but would you invite me to the FOMC meeting? That's something that we get the minutes later on....
Kohn rudely cuts him off, in my estimation, but then what he said next should set off fire alarms in anyone's mind.
Vice Chair of the FRBG, Donald Kohn: You get the transcripts after five years, and you get the minutes after three weeks. I think opening the Federal Open Market Committee to the public would greatly inhibit the discussion in that committee meeting. I think that it would promote financial speculation and would impinge on making good decisions.
By deciding to not publish the minutes and transcripts for public review within the allotted time that decisive action could be taken to halt any kind of future problems that occur, the Federal Reserve is obstructing justice, declaring itself above the law.
I do have a tendency to hesitate to post videos because not everyone has a high speed internet connection. I think it's important for the readers of this blog to get as much information out of this as they can.
The important section of the video comes at the end.
I wanted to transcribe the most important part.
Hon. Paul: ....you give us the kind of information that you want us to have. I've been on the Financial Services Committee for a long time, but would you invite me to the FOMC meeting? That's something that we get the minutes later on....
Kohn rudely cuts him off, in my estimation, but then what he said next should set off fire alarms in anyone's mind.
Vice Chair of the FRBG, Donald Kohn: You get the transcripts after five years, and you get the minutes after three weeks. I think opening the Federal Open Market Committee to the public would greatly inhibit the discussion in that committee meeting. I think that it would promote financial speculation and would impinge on making good decisions.
By deciding to not publish the minutes and transcripts for public review within the allotted time that decisive action could be taken to halt any kind of future problems that occur, the Federal Reserve is obstructing justice, declaring itself above the law.
Sunday, February 1, 2009
Government Regulators aided IndyMac cover up, maybe others. (repost - fixed)
I'm requesting in this post that someone who has administrative rights to this blog, whether it be Shane or Toona Fish, add another important link to our list. This one is Jesse's Café Américain.
I'm reprinting here one of his articles that I feel should be carried on this blog because of the scale of possible implications the story could involve.
Jesse's commentary follows after link:
US Treasury Department Official Allegedly Aided and Abetted Banking Fraud (Again)
Dated: January 16, 2009.
Darrell Dochow earns $230,000 per year at Treasury in banking regulation. He reportedly gave Indymac some suggestions on cooking their books, and then allowed the exception to the rules to accomplish it. It appears to have been a blatant and obvious accounting fraud.
Mr. Dochow is also the official who presided over the Lincoln Savings and Loan scandal. Having looked into Charles Keating's eyes and seeing him a good man, he reportedly overrode the protests and findings of fraud from the banking experts. After his S&L debacle he was apparently demoted, but brought back into a position of importance under the Bush Administration. All the details on this have not yet been made public.
Mr. Dochow is unlikely to do any prison time, but may lose his job. That is because this is 'criminal with a small c' according to this news report.
When this sort of behaviour becomes criminal with a 'capital C' and when people like Dochow find themselves on the business end of FBI probes and Justice Department indictments at least as serious as the one mounted against Eliot Spitzer and his hooker, we might make some approach to honesty and reform in this country.
Ok, Obama Administration, the buck is on your desk now. Time to take meaningful action to back up the rhetoric.
I'm reprinting here one of his articles that I feel should be carried on this blog because of the scale of possible implications the story could involve.
Jesse's commentary follows after link:
US Treasury Department Official Allegedly Aided and Abetted Banking Fraud (Again)
Dated: January 16, 2009.
Darrell Dochow earns $230,000 per year at Treasury in banking regulation. He reportedly gave Indymac some suggestions on cooking their books, and then allowed the exception to the rules to accomplish it. It appears to have been a blatant and obvious accounting fraud.
Mr. Dochow is also the official who presided over the Lincoln Savings and Loan scandal. Having looked into Charles Keating's eyes and seeing him a good man, he reportedly overrode the protests and findings of fraud from the banking experts. After his S&L debacle he was apparently demoted, but brought back into a position of importance under the Bush Administration. All the details on this have not yet been made public.
Mr. Dochow is unlikely to do any prison time, but may lose his job. That is because this is 'criminal with a small c' according to this news report.
When this sort of behaviour becomes criminal with a 'capital C' and when people like Dochow find themselves on the business end of FBI probes and Justice Department indictments at least as serious as the one mounted against Eliot Spitzer and his hooker, we might make some approach to honesty and reform in this country.
Ok, Obama Administration, the buck is on your desk now. Time to take meaningful action to back up the rhetoric.
Thursday, January 8, 2009
Barack Issues Dire Warning on Economy
http://news.aol.com/main/obama-presidency/article/obama-issues-dire-warning-on-economy/269859
FAIRFAX, Va. (Jan. 8) President-elect Barack Obama warned of dire and long-lasting consequences if Congress doesn't pump unprecedented dollars into the national economy, making an urgent pitch Thursday for his mammoth spending proposal in his first speech since the election.
"In short, a bad situation could become dramatically worse" if Washington doesn't go far enough to address the spreading crisis, the Democrat said as fresh economic reports showed an outlook growing increasingly grim.
Someone should tell Barack Obama that you cannot save a sinking ship by throwing buckets of water onto its decks! Oh, wait, Ron Paul already did that. But he not only told Barack Obama this inconvenient truth, he told this to his fellow legislatures in Congress and also to Ben Bernanke, Greenspan, and Paulson.
We're now 16 TRILLION DOLLARS IN DEBT, and perhaps beyond that -- the numbers begin to blur and run together once you lose count of the mammoth debt toll -- but America doesn't recognize this burden for the reason that the debt clock hasn't caught up yet.
Something tells me -- I don't know... perhaps its LOGIC AND REASON... that the request made by the auto industry to be bailed out was evidence enough to support the argument that the bailout of the banking industry failed at meeting its stated aims. I realize the two industries are different, but the relationship is, after all, symbiotic.
FAIRFAX, Va. (Jan. 8) President-elect Barack Obama warned of dire and long-lasting consequences if Congress doesn't pump unprecedented dollars into the national economy, making an urgent pitch Thursday for his mammoth spending proposal in his first speech since the election.
"In short, a bad situation could become dramatically worse" if Washington doesn't go far enough to address the spreading crisis, the Democrat said as fresh economic reports showed an outlook growing increasingly grim.
Someone should tell Barack Obama that you cannot save a sinking ship by throwing buckets of water onto its decks! Oh, wait, Ron Paul already did that. But he not only told Barack Obama this inconvenient truth, he told this to his fellow legislatures in Congress and also to Ben Bernanke, Greenspan, and Paulson.
We're now 16 TRILLION DOLLARS IN DEBT, and perhaps beyond that -- the numbers begin to blur and run together once you lose count of the mammoth debt toll -- but America doesn't recognize this burden for the reason that the debt clock hasn't caught up yet.
Something tells me -- I don't know... perhaps its LOGIC AND REASON... that the request made by the auto industry to be bailed out was evidence enough to support the argument that the bailout of the banking industry failed at meeting its stated aims. I realize the two industries are different, but the relationship is, after all, symbiotic.
Saturday, December 13, 2008
Rep. Ron Paul in Congress 12/10/2008
Thank you, Dr. Paul.
Excuse the Matrix footage, please. I couldn't find another video with both speeches in it.
Wednesday, December 10, 2008
The Calamity of Bush's Conservatism
I've been meaning to post this for a while now and haven't gotten around to it. This is a video of Lew Rockwell's Speech made at the Ron Paul Rally in Minnesota.
Friday, November 28, 2008
Ron Paul Warns of Secret Plans to Create International Central Bank
Texas Congressman Ron Paul has warned that international forces are planning the creation of a global central bank that will see a new fiat monetary system come to dominate the world economy.
The 2008 presidential candidate also warned that Barack Obama's administration will only represent a change in faces and not in policies. Speaking about the recent G20 meeting Paul told Russia Today:
"I think something will come of it but you probably didn't hear about it yet. There was some pomp and ceremony that the public knew about, but behind the scenes they were talking about the future and what they are going to do to try to internationalize all regulations, going in the opposite direction of free market and more towards international regulations. I'm sure they even talked about an international central bank."
Paul also pointed out that global bankers have been holding their own talks on the same matter:
"At the same time the G20 was meeting, we also had the central banks meeting in Europe. Bernanke was over there, and they are doing the same type of planning, so real planning will not be out in the open, until they want us to know about it." the Congressman said.
"The system that we have today where the fiat dollar is a reserve currency of the world, it's losing that status and they have to replace it. Hopefully they'll have enough sense to realise that another international agreement along the Bretton Woods will be no more successful than the last one." Paul continued.
The Congressman argued that more regulations administered by central banks, rather than placed on to central banks, represents a dangerous move away from the free market.
"We could restructure by getting rid of all the central banks, then you would have honest money come up because nobody could commit fraud. Governments get away with committing fraud - that's what fiat money is." Paul commented.
The Congressman warned that an Obama presidency offers no alternative to the economic policies that have led the U.S. and the world to the brink of economic meltdown. Paul Described the kind of change Obama offers as:
"Just change in faces and change in party labels. Both parties represent the same special interests, they both have to represent big business. Obama's supposed to be a man of the people, well he collected $750 million, more money than anybody else ever collected. Wall Street supported him, the media supported him, all the big money supported him, so his change is not going to be much change at all. He's not talking about changing monetary policy, the Federal Reserve or getting rid of the income tax or bringing our troops home."
Paul also commented that he does not believe Obama will withdraw troops from Iraq and pointed out that he has never said he will close down the military bases throughout the country and eliminate the huge embassy in Baghdad.
"Policy will remain interventionist," the Congressman warned. "We will remain in the middle east and we will not be coming home, we'll stay in Korea, we'll stay in Europe, we'll be in eastern Europe, we'll be doing all these things. Even though Obama benefited tremendously from 'change', all we are changing is the face of our government."
Paul also warned that the stage has been set for fresh terrorist attacks in the U.S. as a consequence of a sustained interventionist foreign policy.
Watch the entire interview here.
Ron Paul Warns of Secret Plans to Create International Central Bank
(blogger's note: the news never ends, and I'm still working on some blogs to be posted later on. I'd rather post my own news stories myself, but what happens so many times is that I begin writing something and end up worrying about grammer and word function.)
The 2008 presidential candidate also warned that Barack Obama's administration will only represent a change in faces and not in policies. Speaking about the recent G20 meeting Paul told Russia Today:
"I think something will come of it but you probably didn't hear about it yet. There was some pomp and ceremony that the public knew about, but behind the scenes they were talking about the future and what they are going to do to try to internationalize all regulations, going in the opposite direction of free market and more towards international regulations. I'm sure they even talked about an international central bank."
Paul also pointed out that global bankers have been holding their own talks on the same matter:
"At the same time the G20 was meeting, we also had the central banks meeting in Europe. Bernanke was over there, and they are doing the same type of planning, so real planning will not be out in the open, until they want us to know about it." the Congressman said.
"The system that we have today where the fiat dollar is a reserve currency of the world, it's losing that status and they have to replace it. Hopefully they'll have enough sense to realise that another international agreement along the Bretton Woods will be no more successful than the last one." Paul continued.
The Congressman argued that more regulations administered by central banks, rather than placed on to central banks, represents a dangerous move away from the free market.
"We could restructure by getting rid of all the central banks, then you would have honest money come up because nobody could commit fraud. Governments get away with committing fraud - that's what fiat money is." Paul commented.
The Congressman warned that an Obama presidency offers no alternative to the economic policies that have led the U.S. and the world to the brink of economic meltdown. Paul Described the kind of change Obama offers as:
"Just change in faces and change in party labels. Both parties represent the same special interests, they both have to represent big business. Obama's supposed to be a man of the people, well he collected $750 million, more money than anybody else ever collected. Wall Street supported him, the media supported him, all the big money supported him, so his change is not going to be much change at all. He's not talking about changing monetary policy, the Federal Reserve or getting rid of the income tax or bringing our troops home."
Paul also commented that he does not believe Obama will withdraw troops from Iraq and pointed out that he has never said he will close down the military bases throughout the country and eliminate the huge embassy in Baghdad.
"Policy will remain interventionist," the Congressman warned. "We will remain in the middle east and we will not be coming home, we'll stay in Korea, we'll stay in Europe, we'll be in eastern Europe, we'll be doing all these things. Even though Obama benefited tremendously from 'change', all we are changing is the face of our government."
Paul also warned that the stage has been set for fresh terrorist attacks in the U.S. as a consequence of a sustained interventionist foreign policy.
Watch the entire interview here.
Ron Paul Warns of Secret Plans to Create International Central Bank
(blogger's note: the news never ends, and I'm still working on some blogs to be posted later on. I'd rather post my own news stories myself, but what happens so many times is that I begin writing something and end up worrying about grammer and word function.)
Tuesday, November 25, 2008
Ron Paul Speech @ Houston - End the Fed
The Bailout Surge by Ron Paul
This week the bailout of the Big Three automakers was under heavy consideration in Congress’s lame duck session. I have always opposed government bailouts of private organizations. Back in 1979 Congress had hearings about bailing out Chrysler and I was on record pointing out that these types of policies are foolish and very damaging to the long term economic health of our country. They still are.
There was also renewed pressure this week to bailout homeowners and send another round of stimulus checks to “Main Street” to balance out all the handouts to big business. It seems that eventually the entire economy is going to be blanketed over with Federal Reserve notes. Most in Washington are completely oblivious as to why this model of money creation and spending is so dangerous.
We must remember that governments do not produce anything. Their only resources come from producers in the economy through such means as inflation and taxation. The government has an obligation to be good stewards of these resources. In bailing out failing companies, they are confiscating money from productive members of the economy and giving it to failing ones. By sustaining companies with obsolete or unsustainable business models, the government prevents their resources from being liquidated and made available to other companies that can put them to better, more productive use. An essential element of a healthy free market, is that both success and failure must be permitted to happen when they are earned. But instead with a bailout, the rewards are reversed – the proceeds from successful entities are given to failing ones. How this is supposed to be good for our economy is beyond me.
With each bailout we hear rhetoric that this is the mother of all bailouts. This will fix the problem once and for all, and that this is absolutely necessary to avert disaster. This sense of panic squeezes astonishing amounts of dollars out of reluctant but hopeful legislators, who hate the position they are being put in, but are relieved that it will be the last time. It is never the last time, and again and again we are faced with the same scenarios and the same fears. We are already in the bailout business for such a staggering amount that admitting it was wrong in the first place would be too embarrassing. So the commitment to this course of action is only irrationally escalated, in the hopes that somehow, someway eventually it will work and those in power won’t have to admit they were wrong.
It won’t work. It can’t work. We need to cut our losses and get back on course. There is too much at stake for too many people to continue down this road. The bailouts thus far to AIG, Bear Stearns, Fannie and Freddie, and TARP funds amount to around $1.5 trillion. Considering our GDP is $14 trillion, and our Federal budget is already $3 trillion, this additional amount will significantly eat into our future lifestyles. That amounts to an extra $5,000 that every person in the country needs to somehow produce just to keep up. It is obvious to most Americans that we need to reject corporate cronyism, and allow the natural regulations and incentives of the free market to pick the winners and losers in our economy, not the whims of bureaucrats and politicians.
Thursday, November 20, 2008
Wednesday, November 19, 2008
The Federal Reserve System
"History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible, to maintain their control over governments, by controlling money and its issuance."- James Madison
"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."
- Thomas Jefferson, Letter to the Secretary of the Treasury Albert Gallatin
I hope I don't fail at this explanation. It's a complicated subject. It's not meant to be understood by very many people, so I'm going to try to simplify a very complex technical procedure.
Alright... so what is the Federal Reserve System? The Federal Reserve System is not Federal, you can access its phone number in the business pages of any public phone book, it is not a Reserve because its a bank of issue, and it is not a system either. Instead the Fed is what Eustace Mullins terms a "criminal syndicate" and is the product of international Jewish activity. Like any other company it has its own stock. The Federal Reserve Act of 1913 stipulates, however, that the only owners of its stock can be those who it is bequeathed to and those families that made the initial stock purchase. These families are the Rothschilds of the Bank of England, the Rockefellers, the Warburgs, the Schiffs, the Harrimans, the Morgans and others which comprise what Mullins terms "the World Order." The Fed was created for two purposes: to seize control of money and credit of the people of the united States and to finance wars. By controlling the issuance of money, the Federal Reserve controls the value thereof. How is this accomplished? Allow me to quote Mullins: The Federal Reserve Board of Governors, meeting in private as the Federal Open Market Committee with presidents of the Federal Reserve Banks, controls all economic activity throughout the United States by issuing orders to buy government bonds on the open market, creating money out of nothing and causing inflationary pressure, or, conversely, by selling government bonds on the open market and extinguishing debt, creating deflationary pressure and causing the stock market to drop.
Article 1, Section 8, paragraph 5 of the Constitution expressly charges Congress to coin money and regulate the value thereof. This is the most important part of the Constitution as it is the spine of Constitutional governance. Once the position is relaxed, America ceases to be free. On the night of November 22nd, 1910, Senator Nelson Aldrich and Jewish emigrant Paul Warburg led a delegation of financiers from the Brunswich Station of Hoboken, New Jersey to meet in secret at Jekyll Island, Georgia to hatch this sinister plot. Three years later, Paul Warburg's creation was installed overtop the united States government.
It wouldn't be usurious if the Federal Reserve loaned interest free money to Congress and allowed Congress to pay it back by printing up its own interest free money. But then there wouldn't be much purpose for a Federal Reserve because why would Congress allow a seperate entity the performance of a duty the Constitution granted Congress the power to do in the first place? It becomes a scam when the Federal Reserve issues interest bearing currency and disallows government to print up its own non-interest bearing currency to pay it off. This is beneficial to the Federal Reserve bankers because the Fed forces Congress into paying off its debt to the Fed by using the same procedure that creates the debt. Meanwhile, to collect the interest of the debt directly from the people, the Fed uses its private collection agency, the Internal Revenue Service with its unconstitutional federal income tax. During Reagan's presidency a commission was formed and led by J. Peter Grace. The Grace Commission reported that "100% of what is collected is absorbed solely by interest on the Federal Debt ... all individual income tax revenues are gone before one nickel is spent on the services taxpayers expect from government."
This mean that not one penny of federal income tax goes to pay for schools, police, libraries, fire departments, roadways, road work, or anything else. This is all paid for by state and local taxes. "But, Mr. Goldbug," you'll ask, "if the federal income tax goes to pay off the national interest of the national debt, then where does all the other money come from to pay for social security, medicare, medicaid, the umemployment wage, our military adventures, et cetera ad infinitum?"
Six months before the fiscal year begins, which starts in October, the President sends a budget proposal to Congress. If Congress doesn’t agree with the President’s budget proposal then the House of Representatives prepares their own budget proposal and then sends it to the Senate. If the Senate doesn’t approve of the budget proposal sent to them from the House of Representatives then the House of Representatives has to revise it and send it again. If the Senate doesn’t approve of the budget proposal sent to them from the House of Representatives the second time then the House of Representatives and Senate get together and jointly forms a budget agreement. Now, if the budget agreed upon exceeds the amount collected from taxes through the IRS, then the U.S. Treasury holds bond auctions to fill in the separation in the budget gap created by not collecting enough taxes. At these U.S. Treasury bond auctions, 22 primary dealers (representatives from Citibank, Goldman Sachs, J.P. Morgan-Chase, Morgan Stanley, etc) who are required by government to attend, purchase the bonds to keep the country running. The U.S. Mint doesn’t just print dollar bills of varying denomination, the U.S. Mint also prints bonds of varying maturities. And here's the catch. For the banks to be a part of the Federal Reserve System, they have to hold government bonds in their core portfolios. The central bank system with its fractional-reserve lending (which is to say being able to lend out 9x the one held in reserve) is inherently anti-free market because from its very inception it is a monopoly cartel. The Federal Open Market Committee protects the banks from competition in the market place. And the members of the Fortune 500 all benefit from this monopoly. The prophecy of Thomas Jefferson has come to pass.
Most economists would have you believe that rising prices is inflation. This is incorrect. Austrian economic theory teaches us that inflation is the increase in the money supply and the rise in prices is a consequence of inflation. The popular misconception is that prices are rising, which is only half-truth. The devaluation of the dollar causes the prices to rise. The devaluation, however, doesn't happen at all once and to the same degree. As the Fed increases the money supply, the politically well connected -- goverment contractors, big banks, etc -- they enjoy a windfall. As the new money ripples out into the marketplace at a widening geometric-ratio, there is an immediate redistribution effect. Before the newly created money reaches the mass of people, businesses have already adjusted their prices while the average Joe suffers from living off an income that hasn't adjusted. The true losers in this cruel game of Robin Hood are the ones on fixed incomes (annuities, pensions, etc) because they never get to enjoy the money at all. This not only becomes a redistribution of wealth but also a hidden insidious tax which is far more underhanded than any other obvious tax. How is this so? The rich expropriate the middle class and the poor through the windfall of inflation and the value of the dollar which the people rely on as an instrument to barter with has been stolen from them. The liberal socialists are always complaining about an ever widening gap between the rich and the poor but never do they understand what causes this. And this is why there are so many more billionaires on Wall Street than ever before.
So with the ability to charge government interest on inflation and collect from the people of the government, the Rothschild banking family has been able to amass fortunes no other family in history of the world has been able to accomplish. And they have their signature banks all around the world, charging interest on inflation, turning once powerful countries into third-world plantations by invention of "trade agreements". Then with the money they've made through theft, they fund and create wars to use as pretext excuses for global government which they achieve by criss-crossing the world stringing each nation together into a heavily laced network under the umbrella of the U.N. Once someone becomes the richest man in the world the next step is to become the most powerful man in the universe.
Jesus Christ can be found in the Bible speaking out against such Jewish treachery.
"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."
- Thomas Jefferson, Letter to the Secretary of the Treasury Albert Gallatin
I hope I don't fail at this explanation. It's a complicated subject. It's not meant to be understood by very many people, so I'm going to try to simplify a very complex technical procedure.
Alright... so what is the Federal Reserve System? The Federal Reserve System is not Federal, you can access its phone number in the business pages of any public phone book, it is not a Reserve because its a bank of issue, and it is not a system either. Instead the Fed is what Eustace Mullins terms a "criminal syndicate" and is the product of international Jewish activity. Like any other company it has its own stock. The Federal Reserve Act of 1913 stipulates, however, that the only owners of its stock can be those who it is bequeathed to and those families that made the initial stock purchase. These families are the Rothschilds of the Bank of England, the Rockefellers, the Warburgs, the Schiffs, the Harrimans, the Morgans and others which comprise what Mullins terms "the World Order." The Fed was created for two purposes: to seize control of money and credit of the people of the united States and to finance wars. By controlling the issuance of money, the Federal Reserve controls the value thereof. How is this accomplished? Allow me to quote Mullins: The Federal Reserve Board of Governors, meeting in private as the Federal Open Market Committee with presidents of the Federal Reserve Banks, controls all economic activity throughout the United States by issuing orders to buy government bonds on the open market, creating money out of nothing and causing inflationary pressure, or, conversely, by selling government bonds on the open market and extinguishing debt, creating deflationary pressure and causing the stock market to drop.
Article 1, Section 8, paragraph 5 of the Constitution expressly charges Congress to coin money and regulate the value thereof. This is the most important part of the Constitution as it is the spine of Constitutional governance. Once the position is relaxed, America ceases to be free. On the night of November 22nd, 1910, Senator Nelson Aldrich and Jewish emigrant Paul Warburg led a delegation of financiers from the Brunswich Station of Hoboken, New Jersey to meet in secret at Jekyll Island, Georgia to hatch this sinister plot. Three years later, Paul Warburg's creation was installed overtop the united States government.
It wouldn't be usurious if the Federal Reserve loaned interest free money to Congress and allowed Congress to pay it back by printing up its own interest free money. But then there wouldn't be much purpose for a Federal Reserve because why would Congress allow a seperate entity the performance of a duty the Constitution granted Congress the power to do in the first place? It becomes a scam when the Federal Reserve issues interest bearing currency and disallows government to print up its own non-interest bearing currency to pay it off. This is beneficial to the Federal Reserve bankers because the Fed forces Congress into paying off its debt to the Fed by using the same procedure that creates the debt. Meanwhile, to collect the interest of the debt directly from the people, the Fed uses its private collection agency, the Internal Revenue Service with its unconstitutional federal income tax. During Reagan's presidency a commission was formed and led by J. Peter Grace. The Grace Commission reported that "100% of what is collected is absorbed solely by interest on the Federal Debt ... all individual income tax revenues are gone before one nickel is spent on the services taxpayers expect from government."
This mean that not one penny of federal income tax goes to pay for schools, police, libraries, fire departments, roadways, road work, or anything else. This is all paid for by state and local taxes. "But, Mr. Goldbug," you'll ask, "if the federal income tax goes to pay off the national interest of the national debt, then where does all the other money come from to pay for social security, medicare, medicaid, the umemployment wage, our military adventures, et cetera ad infinitum?"
Six months before the fiscal year begins, which starts in October, the President sends a budget proposal to Congress. If Congress doesn’t agree with the President’s budget proposal then the House of Representatives prepares their own budget proposal and then sends it to the Senate. If the Senate doesn’t approve of the budget proposal sent to them from the House of Representatives then the House of Representatives has to revise it and send it again. If the Senate doesn’t approve of the budget proposal sent to them from the House of Representatives the second time then the House of Representatives and Senate get together and jointly forms a budget agreement. Now, if the budget agreed upon exceeds the amount collected from taxes through the IRS, then the U.S. Treasury holds bond auctions to fill in the separation in the budget gap created by not collecting enough taxes. At these U.S. Treasury bond auctions, 22 primary dealers (representatives from Citibank, Goldman Sachs, J.P. Morgan-Chase, Morgan Stanley, etc) who are required by government to attend, purchase the bonds to keep the country running. The U.S. Mint doesn’t just print dollar bills of varying denomination, the U.S. Mint also prints bonds of varying maturities. And here's the catch. For the banks to be a part of the Federal Reserve System, they have to hold government bonds in their core portfolios. The central bank system with its fractional-reserve lending (which is to say being able to lend out 9x the one held in reserve) is inherently anti-free market because from its very inception it is a monopoly cartel. The Federal Open Market Committee protects the banks from competition in the market place. And the members of the Fortune 500 all benefit from this monopoly. The prophecy of Thomas Jefferson has come to pass.
Most economists would have you believe that rising prices is inflation. This is incorrect. Austrian economic theory teaches us that inflation is the increase in the money supply and the rise in prices is a consequence of inflation. The popular misconception is that prices are rising, which is only half-truth. The devaluation of the dollar causes the prices to rise. The devaluation, however, doesn't happen at all once and to the same degree. As the Fed increases the money supply, the politically well connected -- goverment contractors, big banks, etc -- they enjoy a windfall. As the new money ripples out into the marketplace at a widening geometric-ratio, there is an immediate redistribution effect. Before the newly created money reaches the mass of people, businesses have already adjusted their prices while the average Joe suffers from living off an income that hasn't adjusted. The true losers in this cruel game of Robin Hood are the ones on fixed incomes (annuities, pensions, etc) because they never get to enjoy the money at all. This not only becomes a redistribution of wealth but also a hidden insidious tax which is far more underhanded than any other obvious tax. How is this so? The rich expropriate the middle class and the poor through the windfall of inflation and the value of the dollar which the people rely on as an instrument to barter with has been stolen from them. The liberal socialists are always complaining about an ever widening gap between the rich and the poor but never do they understand what causes this. And this is why there are so many more billionaires on Wall Street than ever before.
So with the ability to charge government interest on inflation and collect from the people of the government, the Rothschild banking family has been able to amass fortunes no other family in history of the world has been able to accomplish. And they have their signature banks all around the world, charging interest on inflation, turning once powerful countries into third-world plantations by invention of "trade agreements". Then with the money they've made through theft, they fund and create wars to use as pretext excuses for global government which they achieve by criss-crossing the world stringing each nation together into a heavily laced network under the umbrella of the U.N. Once someone becomes the richest man in the world the next step is to become the most powerful man in the universe.
Jesus Christ can be found in the Bible speaking out against such Jewish treachery.
Tainted Lunch Meat : Ron Paul makes Ben Bernanke look kinda silly
Watching C-span this morning and I saw Ron Paul questioning Ben Bernanke. Paul seems to make a solid argument for going back to a pre-1971 system of asset backed reserve currency. Not entirely sure what to make of the video, but it seems interesting to hear comments like Paul's in this economic climate. I doubt there is much traction for the idea in the public. However that may be due to a lack of understanding of what exactly our economy is based on.
Tuesday, November 18, 2008
Le Metropole Cafe Article Excerpt.
I've been meaning to post a blog about the dire straits America is in now thanks to our bandit Federal Reserve.
The following piece appeared in an article on Le Metropole Cafe. I forgot who wrote it, it was either Bill Murphy or Chris Powell of the Gold Anti-Trust Action Committe, of whom I'll be blogging more about when I can organize some blogs in a chronological educational manner. But for now, since I've been procrastinating posting my "definitive" account of the failure of Wall Street, I figured I'd just post this. I think it has enough dramatic pomp to please the reader. This was included in an email of mine to someone else dated 9/21/2008.
This past week was a disaster for markets worldwide. We came closer to a financial meltdown than any time since the Depression. Don't take my word for it, listen to Pres. Bush, Paulson, Bernanke, Cox, Dodd, Schumer, Gross, etc.. These are the same people who have been telling us all along that everything was just hunky dory. Remember Paulson, Bernanke, and Sheila Bair doing their media blitz and assuring anyone who would listen that the "banking system is sound" and "the financial system is strong"? That was just TWO WEEKS AGO during the Fannie and Freddie failures.
WOW! What happened? How could the whole system go from "sound" and "strong" to the verge of a meltdown in such a short period of time?
So what really happened? The Dow and S+P hardly went down this week so what's the big deal? The big deal is that the credit markets completely seized up, no one was lending, we had a $100+ Billion run on money markets, short Treasury rates went negative, Central banks were forced to pump half a Trillion Dollars into the system just to keep the doors open. Lehman Brothers failed, Merrill Lynch disappeared and AIG was saved by the government all within 3 days, this, the week after Fannie and Freddie were nationalized. How come no one told us 30 days ago that we had big enough problems that could threaten the entire system? No, no one from the government had anything other than BLATANT LIES for public consumption 30 days ago [actually 20]! Now we are told they have the answer, WE WILL ALL BE SAVED! They weren't telling the truth last month but now they are? Why? Because tomorrow is a new season? Because they planned to go to church today and will swear to God that if he spares them they "won't do it again"? NO! Because the game is over, they know it, we know it, and they know we know it. They have to tell us that all is well even though it isn't, as the TRUTH will cause THE panic of all time.
OK so here's the deal, we were one minute to midnight this past week. We know this because Wall Street and the government finally admitted that the system was imploding. But wait, now they have a plan, didn't they have a plan before? Treasury is going to wave its magic wand and buy up $700 Billion of "toxic mortgages" [their words not mine] and that will solve everything. $700 Billion is a lot of money no? NO!!! $700 Billion won't even scratch the surface of this problem, the derivative market is now over $1 Quadrillion. This is over one thousand TRILLION DOLLARS. The mortgage market in the US probably approaches $20 Trillion. This new "plan" will not do anything other than bail out institutions that ALREADY own toxic debt. It won't help me, and it won't help you make next months mortgage payment. All this does is buy time. How much? Who knows? It buys time until people realize that all the Treasury is doing is trying to prolong a system that has already broken down.
We already know that without government intervention this past week, the system would have imploded. Now the government wants to save the system with more of the same [more debt] so we can go back to living like we have in the past? Wasn't the way the system worked up until now just proven to be a failure? It felt good, it was fun, in some ways it was even easy. Of course it was all of this because we LIVED BEYOND OUR MEANS for years upon years! So now the Treasury will go out and borrow $Trillions [yes Trillions not Billions] more to fix a problem that was caused by living too large for too long in the first place.
But there is a big, fat fly in this ointment. In order for the magic wand to wave its magic powers, the Treasury has to have the ability to borrow these $ Trillions. For years now the US has not been able to fund it's own debt. We have gone across the globe to borrow the money necessary to live light years beyond our means.
Foreigners now know that we have not been entirely truthful about the status of various financial products we sold them, nor were we truthful about companies' prospects, economic numbers [inflation , money supply etc.] and the health of the entire system in general. Are foreigners now going to fall all over each other to line up and lend the Treasury more capital? I think not. I think not because the Treasury has already had it's debt downgraded in the CDS markets. The credit default swap rates on US Treasuries have more than doubled in the last month so that market has already made a judgment with negative bias. I can see big pressure on interest rates to rise because of this additional necessary debt. When rates rise for Treasury borrowings, I assure you mortgage rates will rise also. This cannot be good for the real estate markets.
Last but not least is the value of the Dollar. Let's assume this is only a $700 Billion magic wand [I assure you it will have to be more]. This is an additional $700 Billion of added money supply and added debt that goes into the system without the system expanding. The mathematical outcome of this action is a MUCH LOWER DOLLAR value. This is highly inflationary. Over the next sixty days or so the inflation volcano will surely spurt a few unpleasant and unintended consequences. Inflation of "things", the things we need to live our daily lives will explode. Even if $700 Billion is the correct number, US debt will expand 7%. So in one sense this amount of money is chicken feed as to the amount really needed, and on the other hand it is a huge amount based upon the Treasury's ability to borrow.
Actually all of the above will soon prove to be moot because a total collapse will stop the clock. Treasury will have a failed auction very shortly, let's do some math. Just over the last two weeks Treasury has announced spending of $100 Billion each for Fannie and Freddie, $85 Billion for AIG, extra $s for the Fed [because the Fed has run through it's balance sheet and now only has the ability to print], Lehman ?, FDIC will need $50 Billion, and the magic wand of a mere $700 Billion. So... that will come to ...over $1 Trillion! I don't know about you, but since we are broke we might as well spend the exta .69 cents and supersize it! The funding will not be there for US to borrow, all that remains now is Ben Bernanke's printing press. Monetization will become as common a phrase as "would you like to supersize that". Your only protection against monetizing the debt is a four letter word that the government wishes you didn't know.
The following piece appeared in an article on Le Metropole Cafe. I forgot who wrote it, it was either Bill Murphy or Chris Powell of the Gold Anti-Trust Action Committe, of whom I'll be blogging more about when I can organize some blogs in a chronological educational manner. But for now, since I've been procrastinating posting my "definitive" account of the failure of Wall Street, I figured I'd just post this. I think it has enough dramatic pomp to please the reader. This was included in an email of mine to someone else dated 9/21/2008.
This past week was a disaster for markets worldwide. We came closer to a financial meltdown than any time since the Depression. Don't take my word for it, listen to Pres. Bush, Paulson, Bernanke, Cox, Dodd, Schumer, Gross, etc.. These are the same people who have been telling us all along that everything was just hunky dory. Remember Paulson, Bernanke, and Sheila Bair doing their media blitz and assuring anyone who would listen that the "banking system is sound" and "the financial system is strong"? That was just TWO WEEKS AGO during the Fannie and Freddie failures.
WOW! What happened? How could the whole system go from "sound" and "strong" to the verge of a meltdown in such a short period of time?
So what really happened? The Dow and S+P hardly went down this week so what's the big deal? The big deal is that the credit markets completely seized up, no one was lending, we had a $100+ Billion run on money markets, short Treasury rates went negative, Central banks were forced to pump half a Trillion Dollars into the system just to keep the doors open. Lehman Brothers failed, Merrill Lynch disappeared and AIG was saved by the government all within 3 days, this, the week after Fannie and Freddie were nationalized. How come no one told us 30 days ago that we had big enough problems that could threaten the entire system? No, no one from the government had anything other than BLATANT LIES for public consumption 30 days ago [actually 20]! Now we are told they have the answer, WE WILL ALL BE SAVED! They weren't telling the truth last month but now they are? Why? Because tomorrow is a new season? Because they planned to go to church today and will swear to God that if he spares them they "won't do it again"? NO! Because the game is over, they know it, we know it, and they know we know it. They have to tell us that all is well even though it isn't, as the TRUTH will cause THE panic of all time.
OK so here's the deal, we were one minute to midnight this past week. We know this because Wall Street and the government finally admitted that the system was imploding. But wait, now they have a plan, didn't they have a plan before? Treasury is going to wave its magic wand and buy up $700 Billion of "toxic mortgages" [their words not mine] and that will solve everything. $700 Billion is a lot of money no? NO!!! $700 Billion won't even scratch the surface of this problem, the derivative market is now over $1 Quadrillion. This is over one thousand TRILLION DOLLARS. The mortgage market in the US probably approaches $20 Trillion. This new "plan" will not do anything other than bail out institutions that ALREADY own toxic debt. It won't help me, and it won't help you make next months mortgage payment. All this does is buy time. How much? Who knows? It buys time until people realize that all the Treasury is doing is trying to prolong a system that has already broken down.
We already know that without government intervention this past week, the system would have imploded. Now the government wants to save the system with more of the same [more debt] so we can go back to living like we have in the past? Wasn't the way the system worked up until now just proven to be a failure? It felt good, it was fun, in some ways it was even easy. Of course it was all of this because we LIVED BEYOND OUR MEANS for years upon years! So now the Treasury will go out and borrow $Trillions [yes Trillions not Billions] more to fix a problem that was caused by living too large for too long in the first place.
But there is a big, fat fly in this ointment. In order for the magic wand to wave its magic powers, the Treasury has to have the ability to borrow these $ Trillions. For years now the US has not been able to fund it's own debt. We have gone across the globe to borrow the money necessary to live light years beyond our means.
Foreigners now know that we have not been entirely truthful about the status of various financial products we sold them, nor were we truthful about companies' prospects, economic numbers [inflation , money supply etc.] and the health of the entire system in general. Are foreigners now going to fall all over each other to line up and lend the Treasury more capital? I think not. I think not because the Treasury has already had it's debt downgraded in the CDS markets. The credit default swap rates on US Treasuries have more than doubled in the last month so that market has already made a judgment with negative bias. I can see big pressure on interest rates to rise because of this additional necessary debt. When rates rise for Treasury borrowings, I assure you mortgage rates will rise also. This cannot be good for the real estate markets.
Last but not least is the value of the Dollar. Let's assume this is only a $700 Billion magic wand [I assure you it will have to be more]. This is an additional $700 Billion of added money supply and added debt that goes into the system without the system expanding. The mathematical outcome of this action is a MUCH LOWER DOLLAR value. This is highly inflationary. Over the next sixty days or so the inflation volcano will surely spurt a few unpleasant and unintended consequences. Inflation of "things", the things we need to live our daily lives will explode. Even if $700 Billion is the correct number, US debt will expand 7%. So in one sense this amount of money is chicken feed as to the amount really needed, and on the other hand it is a huge amount based upon the Treasury's ability to borrow.
Actually all of the above will soon prove to be moot because a total collapse will stop the clock. Treasury will have a failed auction very shortly, let's do some math. Just over the last two weeks Treasury has announced spending of $100 Billion each for Fannie and Freddie, $85 Billion for AIG, extra $s for the Fed [because the Fed has run through it's balance sheet and now only has the ability to print], Lehman ?, FDIC will need $50 Billion, and the magic wand of a mere $700 Billion. So... that will come to ...over $1 Trillion! I don't know about you, but since we are broke we might as well spend the exta .69 cents and supersize it! The funding will not be there for US to borrow, all that remains now is Ben Bernanke's printing press. Monetization will become as common a phrase as "would you like to supersize that". Your only protection against monetizing the debt is a four letter word that the government wishes you didn't know.
Saturday, November 15, 2008
Articulated Starfish: Money, Banking, and the Federal Reserve
Long but comprehensive. Features: Ron Paul, Joseph Salerno, Hans Hoppe, and Lew Rockwell.
Friday, November 14, 2008
Tainted Lunch Meat : 30 days to oblivion
So, yeah, wow, that's a list and a half there. I can't wait to see the next 30 days either. I just wonder how many will survive the first 30 days to see the next 30. Now I'm not entirely against every step in that plan, but I do have some reservations. I couldn't 100% tell if this plan was being presented with seriousness or with tongue in cheek humor in mind. I'm going to assume it was posted with a serious mindset.
1. So let's start from the top. With a progressive income tax, like we have, the wealthier citizens pay more taxes than the less wealthy citizens. If you cut out those revenues and offset that with a reduction in spending, the country is no worse for the wear, kinda, sorta. It depends on what spending is cut to match the lack of income tax revenues. Most poor people don't pay income tax. Money comes out of there paycheck but it can usually be recovered as a tax refund check later on. Most wealthy people however do pay income tax, so eliminating it would be great for them, inconsequential for poorer people. Cutting spending could hurt either set, depending on where the cuts are. If you cut social programs for the poor, then it's obvious who wins out in this situation. Maybe the spending cuts could be devised to adversely affect the people who most benefit from them no longer having to pay their fair share.
2.I really don't like the idea of a pay-to-play voting system. A lot of people could be priced out of civic participation almost instantly. Horrible idea, completely.
3.Being a poor person myself, I quite like public land, since I don't own any for myself. And seeing as how many landowners are far from generous in letting me or anyone else have free run of their property, public land needs to stay public, or I need to be rich, either way is good.
4. Again with the bad ideas. Workers need protection. The job market should be upwardly competitive, not a race to the bottom. There is always some jackass willing to do your job for less money than you. He may even do it better. The has to be a floor for wages. And it needs to be high enough that people can live off of it. If you reduce the minimum wage to zero, that's quite likely close to what employers will be willing to pay for the work.
5.Can't really see the benefit of having blind and deaf economic planners.
6.This really doesn't seem to be a burden on big business. They would love to have less regulation.
7.I don't know if prices of oil and gas would plummet. Those prices tend to not plummet, unless we're in the middle of an economic crisis. Of course, if this plan came to fruition, then maybe oil and gas prices do indeed plummet.
8.I wasn't aware competition was illegal. I could be reading this wrong.
9.There is a bit of a difference between HUD housing and "cheap, private, apartments". That difference is a substandard somewhat livable dwelling and a lean-to. I just cant imagine developers lining up to sell or rent cheap housing. The tenants quite likely won't take of the property and the margins and much thinner for profit.
10.I'm not entirely against the general concept of this step. But I think the gas tax can be priced so as to make the roadways just barely self sufficient.
11.This is just hateful. "Work or starve" really? So maybe it's not fair for some people to game the system. I'd still rather see them do that than die. And I'm completely tired of being told people should fall back on charity during hard times. We may be a generous population, but the government of the richest country in the world should be able and willing to take care of its less fortunate citizens.
12.You realise when they repealed the Glass-Steagall Act in 1999, that kind of led us to the meltdown we are seeing now. I can't see how further deregulation helps this in any way whatsoever.
13.I'll never have more than $100,000 in the bank, so alright, down with the FDIC, sure.
14.I like this step, actual asset based currency seems right to me.
15.The only way I'm flying is if I sprout wings, so yeah, I'm good on this step of the path to doom as well.
16.The post office is still cheaper than UPS, and it's not like FedEx is making UPS any cheaper, and DHL is going out of business apparently. Seems like some cartels are worth keeping.
17.Welfare farmers, well I laughed when I read that. "How's the harvest Clem?" "Little short on the welfare, but OK I reckon." That's what went through my mind. Anyways, yeah I'm good with this step too.
18.Really? Get rid of anti-trust laws? They barely save us from Vista as is. Seems like a terrible idea to me.
19.Again with the charities, somehow a cold, heartless government will lead to a kind, caring populace. I don't know, sounds risky, and again an assault on the poor, who may or may not be able to afford private education.
20.Why on earth would you want to sell the Federal Monuments? I like them, I can't afford to buy my own, but I like them all the same. Bad idea. Mt. Rushmore on Ebay FAIL.
21.Now this is something I can get behind. As a late adopter of cell phones, I'm a bit of a Luddite. Data bases are indeed evil. Good idea here.
22.Another idea that just strikes me as hateful. Unpopular minorities need protection, otherwise the tyranny of the mob will oppress them(I'm looking at you California).
23.Yeah, cause you know, of course you can win a legal battle against huge companies over pollution. Their enormous legal budget would absolutely not have any impact on the outcome of the trial. Surely if some evil polluter were dragged in front of a judge, your bargain bin lawyer could totally take 'em to the cleaners. Right. Moving on.
24.I don't even understand what this step means.
25.I'm glad we didn't move to privatize Social Security last year. That may have been painful after watching the Dow shed 4000 + points over the last few months.
26.Leave the NEA alone.
27.I can live with cutting off foreign aid.
28.I'm for it, I like guns. Good idea.
29.I'm down with this one too. Close down most of the 700+ military bases we have all around the world. The empire needs to be over.
30.Good idea, can't wait to get me that discounted Honda Civic.
Exhilarating indeed.
1. So let's start from the top. With a progressive income tax, like we have, the wealthier citizens pay more taxes than the less wealthy citizens. If you cut out those revenues and offset that with a reduction in spending, the country is no worse for the wear, kinda, sorta. It depends on what spending is cut to match the lack of income tax revenues. Most poor people don't pay income tax. Money comes out of there paycheck but it can usually be recovered as a tax refund check later on. Most wealthy people however do pay income tax, so eliminating it would be great for them, inconsequential for poorer people. Cutting spending could hurt either set, depending on where the cuts are. If you cut social programs for the poor, then it's obvious who wins out in this situation. Maybe the spending cuts could be devised to adversely affect the people who most benefit from them no longer having to pay their fair share.
2.I really don't like the idea of a pay-to-play voting system. A lot of people could be priced out of civic participation almost instantly. Horrible idea, completely.
3.Being a poor person myself, I quite like public land, since I don't own any for myself. And seeing as how many landowners are far from generous in letting me or anyone else have free run of their property, public land needs to stay public, or I need to be rich, either way is good.
4. Again with the bad ideas. Workers need protection. The job market should be upwardly competitive, not a race to the bottom. There is always some jackass willing to do your job for less money than you. He may even do it better. The has to be a floor for wages. And it needs to be high enough that people can live off of it. If you reduce the minimum wage to zero, that's quite likely close to what employers will be willing to pay for the work.
5.Can't really see the benefit of having blind and deaf economic planners.
6.This really doesn't seem to be a burden on big business. They would love to have less regulation.
7.I don't know if prices of oil and gas would plummet. Those prices tend to not plummet, unless we're in the middle of an economic crisis. Of course, if this plan came to fruition, then maybe oil and gas prices do indeed plummet.
8.I wasn't aware competition was illegal. I could be reading this wrong.
9.There is a bit of a difference between HUD housing and "cheap, private, apartments". That difference is a substandard somewhat livable dwelling and a lean-to. I just cant imagine developers lining up to sell or rent cheap housing. The tenants quite likely won't take of the property and the margins and much thinner for profit.
10.I'm not entirely against the general concept of this step. But I think the gas tax can be priced so as to make the roadways just barely self sufficient.
11.This is just hateful. "Work or starve" really? So maybe it's not fair for some people to game the system. I'd still rather see them do that than die. And I'm completely tired of being told people should fall back on charity during hard times. We may be a generous population, but the government of the richest country in the world should be able and willing to take care of its less fortunate citizens.
12.You realise when they repealed the Glass-Steagall Act in 1999, that kind of led us to the meltdown we are seeing now. I can't see how further deregulation helps this in any way whatsoever.
13.I'll never have more than $100,000 in the bank, so alright, down with the FDIC, sure.
14.I like this step, actual asset based currency seems right to me.
15.The only way I'm flying is if I sprout wings, so yeah, I'm good on this step of the path to doom as well.
16.The post office is still cheaper than UPS, and it's not like FedEx is making UPS any cheaper, and DHL is going out of business apparently. Seems like some cartels are worth keeping.
17.Welfare farmers, well I laughed when I read that. "How's the harvest Clem?" "Little short on the welfare, but OK I reckon." That's what went through my mind. Anyways, yeah I'm good with this step too.
18.Really? Get rid of anti-trust laws? They barely save us from Vista as is. Seems like a terrible idea to me.
19.Again with the charities, somehow a cold, heartless government will lead to a kind, caring populace. I don't know, sounds risky, and again an assault on the poor, who may or may not be able to afford private education.
20.Why on earth would you want to sell the Federal Monuments? I like them, I can't afford to buy my own, but I like them all the same. Bad idea. Mt. Rushmore on Ebay FAIL.
21.Now this is something I can get behind. As a late adopter of cell phones, I'm a bit of a Luddite. Data bases are indeed evil. Good idea here.
22.Another idea that just strikes me as hateful. Unpopular minorities need protection, otherwise the tyranny of the mob will oppress them(I'm looking at you California).
23.Yeah, cause you know, of course you can win a legal battle against huge companies over pollution. Their enormous legal budget would absolutely not have any impact on the outcome of the trial. Surely if some evil polluter were dragged in front of a judge, your bargain bin lawyer could totally take 'em to the cleaners. Right. Moving on.
24.I don't even understand what this step means.
25.I'm glad we didn't move to privatize Social Security last year. That may have been painful after watching the Dow shed 4000 + points over the last few months.
26.Leave the NEA alone.
27.I can live with cutting off foreign aid.
28.I'm for it, I like guns. Good idea.
29.I'm down with this one too. Close down most of the 700+ military bases we have all around the world. The empire needs to be over.
30.Good idea, can't wait to get me that discounted Honda Civic.
Exhilarating indeed.
Is I.O.U.S.A. Documentary a Fraud?
I've been deliberating about what subject I should blog about tonight. At one point I decided not to, but now I've changed my mind because I felt so strongly about this particular subject that I couldn't ignore the impulse to share.
There's an independent documentary film that has been produced and presented to the Sundance Film Festival called I.O.U.S.A. and I just read a scathing critique about how it is more fraud than truth.
I'm going to provide you the link to the trailer to this documentary so you can at least understand the dramatic hype appeal it has generated.
And here follows the film review, written by Doug French.
The American empire, like the Roman one, is heading for a fall, and an out-of-control government deficit is one of the reasons. However, destruction by deficit is not fait accompli, if Peter Peterson, David Walker and the Concord Coalition have anything to do about it. Peterson and Walker like their government after all. Peterson was United States Secretary of Commerce and Chairman of the Council on Foreign Relations, and is the Senior Chairman of the politically connected private equity firm, Blackstone Group. Walker was Comptroller General of the United States and head of the General Accounting Office. The Concord Coalition is an organization founded by the late former Sens. Paul Tsongas (D-Mass.) and Warren Rudman (R-N.H.), along with Peterson. Concord added former Sen. Bob Kerrey (D-Neb.) in 2002.
Not exactly a confederation of anarcho-capitalists.
I had high hopes for the documentary film I.O.U.S.A., because it was conceived of, co-written and executive produced by Agora Financial’s Addison Wiggin, co-author with Bill Bonner of the excellent book Empire of Debt. When the movie finally started, the opening credits even indicated that the documentary was based on the book. I wish.
Bonner and Wiggin wrote that the purpose of empire was “to show that the United States is headed for trouble.” And, “their burden is only to show that the people making important policy decisions are morons and frauds.” I.O.U.S.A. shows that the United States is in trouble all right, but instead of politicians and central bankers being outed as crooks and mountebanks, the likes of Bill Clinton and Paul Volker are treated as heroes. Ex-Fed Chair Alan Greenspan is made to look like an idiot by Ron Paul in one clip and by comedian Jon Stewart in another, yet the filmmakers continually go back for sound bites from him and ex-Fed governor Alice Rivlin as authority figures. The film even claimed that one Federal Reserve mandate is to keep inflation low. Good grief, the Fed creates inflation.
Empire of Debt cited gold 23 times, government debt 19 times and David Walker only once, Stephen Fairfax noted on the LewRockwell.com blog. But the movie made no mention of gold and makes David Walker out to be the nation’s savior. I.O.U.S.A. is essentially a buddy-movie with Walker and Concord’s Executive Director Robert Bixby hitting the road to alarm Americans into holding their elected officials accountable. So there are plenty of scenes in the car, in the banquet rooms and being interviewed by local TV stations that don’t air their story.
Interspersed amongst these action sequences are person-on-the-street interviews that make the point that the average Joe and Jane don’t know or care about the goings on with the government budget.
If billionaire Warren Buffett has his way, the great unwashed and uninformed will pay the $12.50 they saved by not seeing the movie to the government in taxes. After I.O.U.S.A. concluded, CNBC’s Squawk Box honey Becky Quick moderated a panel of wise ones live from Omaha, led by Tout TV’s favorite guru, Buffett. The panel assured everyone that government Ponzi-scheme Social Security would be there when they retire. The Cato Institutes’ freedom-loving chairman William Niskanen even thinks people should be forced to save for retirement. Bill Novelli, CEO of AARP, believes the five guys on the panel could solve all of the country’s problems. And more than one panelist blamed everything on partisanship in Washington. If our representatives in this great republic could just learn to get along, everything will work out fine, was the claim. After all, America has faced greater challenges and triumphed.
But by far the most annoying was the Omaha Oracle, who continually piped in that the budget deficits aren’t that big a deal, but that trade deficits are, and that future generations of Americans will live better than the present generation, as long as Americans will pay enough in taxes to keep this good American thing going. We are lucky to be born here, according to Buffett, but he is unhappy that he pays a lower tax rate than his cleaning lady. No doubt she is, too.
The main message of the film – that, by the way, was purchased by The Peter G. Peterson Foundation last month – is that all of this debt will “swamp our ship of state,” and that the trade deficit will lead to less leverage in matters overseas. So, pay more taxes, and urge your congressman to decrease government spending.
Instead, moviegoers should spend their time reading Wiggins and Bonner’s book, buying gold and avoiding taxes.
http://www.lewrockwell.com/french/french96.html
There's an independent documentary film that has been produced and presented to the Sundance Film Festival called I.O.U.S.A. and I just read a scathing critique about how it is more fraud than truth.
I'm going to provide you the link to the trailer to this documentary so you can at least understand the dramatic hype appeal it has generated.
And here follows the film review, written by Doug French.
The American empire, like the Roman one, is heading for a fall, and an out-of-control government deficit is one of the reasons. However, destruction by deficit is not fait accompli, if Peter Peterson, David Walker and the Concord Coalition have anything to do about it. Peterson and Walker like their government after all. Peterson was United States Secretary of Commerce and Chairman of the Council on Foreign Relations, and is the Senior Chairman of the politically connected private equity firm, Blackstone Group. Walker was Comptroller General of the United States and head of the General Accounting Office. The Concord Coalition is an organization founded by the late former Sens. Paul Tsongas (D-Mass.) and Warren Rudman (R-N.H.), along with Peterson. Concord added former Sen. Bob Kerrey (D-Neb.) in 2002.
Not exactly a confederation of anarcho-capitalists.
I had high hopes for the documentary film I.O.U.S.A., because it was conceived of, co-written and executive produced by Agora Financial’s Addison Wiggin, co-author with Bill Bonner of the excellent book Empire of Debt. When the movie finally started, the opening credits even indicated that the documentary was based on the book. I wish.
Bonner and Wiggin wrote that the purpose of empire was “to show that the United States is headed for trouble.” And, “their burden is only to show that the people making important policy decisions are morons and frauds.” I.O.U.S.A. shows that the United States is in trouble all right, but instead of politicians and central bankers being outed as crooks and mountebanks, the likes of Bill Clinton and Paul Volker are treated as heroes. Ex-Fed Chair Alan Greenspan is made to look like an idiot by Ron Paul in one clip and by comedian Jon Stewart in another, yet the filmmakers continually go back for sound bites from him and ex-Fed governor Alice Rivlin as authority figures. The film even claimed that one Federal Reserve mandate is to keep inflation low. Good grief, the Fed creates inflation.
Empire of Debt cited gold 23 times, government debt 19 times and David Walker only once, Stephen Fairfax noted on the LewRockwell.com blog. But the movie made no mention of gold and makes David Walker out to be the nation’s savior. I.O.U.S.A. is essentially a buddy-movie with Walker and Concord’s Executive Director Robert Bixby hitting the road to alarm Americans into holding their elected officials accountable. So there are plenty of scenes in the car, in the banquet rooms and being interviewed by local TV stations that don’t air their story.
Interspersed amongst these action sequences are person-on-the-street interviews that make the point that the average Joe and Jane don’t know or care about the goings on with the government budget.
If billionaire Warren Buffett has his way, the great unwashed and uninformed will pay the $12.50 they saved by not seeing the movie to the government in taxes. After I.O.U.S.A. concluded, CNBC’s Squawk Box honey Becky Quick moderated a panel of wise ones live from Omaha, led by Tout TV’s favorite guru, Buffett. The panel assured everyone that government Ponzi-scheme Social Security would be there when they retire. The Cato Institutes’ freedom-loving chairman William Niskanen even thinks people should be forced to save for retirement. Bill Novelli, CEO of AARP, believes the five guys on the panel could solve all of the country’s problems. And more than one panelist blamed everything on partisanship in Washington. If our representatives in this great republic could just learn to get along, everything will work out fine, was the claim. After all, America has faced greater challenges and triumphed.
But by far the most annoying was the Omaha Oracle, who continually piped in that the budget deficits aren’t that big a deal, but that trade deficits are, and that future generations of Americans will live better than the present generation, as long as Americans will pay enough in taxes to keep this good American thing going. We are lucky to be born here, according to Buffett, but he is unhappy that he pays a lower tax rate than his cleaning lady. No doubt she is, too.
The main message of the film – that, by the way, was purchased by The Peter G. Peterson Foundation last month – is that all of this debt will “swamp our ship of state,” and that the trade deficit will lead to less leverage in matters overseas. So, pay more taxes, and urge your congressman to decrease government spending.
Instead, moviegoers should spend their time reading Wiggins and Bonner’s book, buying gold and avoiding taxes.
http://www.lewrockwell.com/french/french96.html
Thursday, November 13, 2008
Lew Rockwell's Thirty Day Plan
Rockwell's Thirty-Day Plan
by Llewellyn H. Rockwell, Jr.
by Llewellyn H. Rockwell, Jr.
When Eastern Europe broke free in 1989, we all realized just how little thought had been given to the transition from socialism to capitalism. Mises had told us the collapse was coming, and we should have been prepared.
As America comes to resemble a command economy, we need a transition plan here too. Yuri Maltsev proposed a "One-Year Plan" for the U.S.S.R. We're not in that bad a shape (yet), so we could do it in 30 days.
DAY ONE: The federal income tax is abolished and April 15th is declared a national holiday. The 40% reduction in federal revenues is matched by a 40% cut in spending. The budget is still almost twice as big as Jimmy Carter's.
DAY TWO: All other federal taxes are abolished, including the corporate income tax, the capital gains tax, the gasoline tax, "sin" taxes, excise taxes, etc. Businesses boom, and the few legitimate federal functions are funded with an inexpensive head tax. People who choose not to vote need not pay it. (Note: this was a mainstream view in the 19th century.)
DAY THREE: The federal government sells all its land, freeing up tens of millions of acres for development, mining, farming, forestry, oil drilling, private parks, etc. The government uses the revenue to pay off the national debt and other liabilities.
DAY FOUR: The minimum wage is reduced to zero, creating jobs for ex-federal bureaucrats at their market wage. All pro-union laws and regulations are scrapped. The jobless rate falls dramatically.
DAY FIVE: The Bureau of Labor Statistics, like the rest of the Labor Department, is sent to that big hiring hall in the sky. Without detailed economic statistics, future economic planners will be blind and deaf.
DAY SIX: The Department of Commerce is abolished. Big business has to make its own way in the world, without subsidies and privileges at the expense of its competitors and customers.
DAY SEVEN: The plug is pulled on the Department of Energy. Oil and gas prices plummet.
DAY EIGHT: All regulatory agencies, from the Interstate Commerce Commission to the Federal Trade Commission, are deep-sixed. Competition is legalized.
DAY NINE: HUD is squashed like a bug. There's a building boom in cheap, private, apartments.
DAY TEN: The interstate highways reopen as private businesses. Road entrepreneurs price travel according to consumer demand. Using modern technology, drivers get bills once a month. Credit risks – and drunks and dangerous drivers – aren't allowed on the road. Non-drivers no longer subsidize car owners.
DAY ELEVEN: Government welfare is wiped out. Bums work or starve. The deserving poor find a cornucopia of private services designed to make them independent. Private charity explodes, as the American people, already the most generous in the world, find their incomes almost doubled, thanks to the tax cuts.
DAY TWELVE: The Federal Reserve closes its open-market operations and stops protecting the banking industry from competition. But banks can now engage in all the non-bank financial activities previously forbidden to them. The business cycle, which is caused by monetary expansion through the credit markets, is liquidated.
DAY THIRTEEN: Federal deposit insurance is scrapped. All insured deposits are redeemed from federal assets, which include the personal assets of high-level government employees. The threat of bank runs forces banks to keep 100% reserves for their demand deposits, and prudent reserves on all other accounts. There are no more inherently bankrupt banks propped up by the government, at taxpayer expense, and no more bail-outs.
DAY FOURTEEN: The shaky fiat dollar is defined in terms of gold, with the ratio determined by dividing the government's gold stock by all existing dollars on that day.
DAY FIFTEEN: The federal government sells National and Dulles airports to the highest bidder, and stops all subsidies to other socialist airports around the country. All constraints on airline prices and service cease. It costs more to fly during peak hours than off-peak, but overall, air travel drops in price.
DAY SIXTEEN: All government regulations that create and sustain cartels are abolished, including those for the post office, telephones, television, radio, and cable TV. Prices plummet, and a host of new and unforeseen services becomes available.
DAY SEVENTEEN: Centrally planned agriculture, as imposed by Hoover and Roosevelt, is repealed: there are no more subsidies, payments-in-kind, marketing orders, low-interest loans, etc. Farm prices drop. Entrepreneurial farmers get rich. Welfare farmers go into another line of work. The poor eat like kings.
DAY EIGHTEEN: The Justice Department shutters its anti-trust division. Companies, big and small, are free to merge – up, down, or sideways. Stockholders can buy any other company, or sell their stock to anyone else. Marginal producers can no longer battle their competitors with bureaucratic weapons.
DAY NINETEEN: The Department of Education flunks the constitutionality test, and is kicked out. Private charities set up remedial reading and writing programs for the former bureaucrats. Federally subsidized sex education and other anti-family programs go out of business. Local school districts become responsive to parents or close, pressured by a fast-growing private school sector (which many more parents can now afford).
DAY TWENTY: All federal monuments are sold, in some cases to non-profit groups based on the Mt. Vernon Ladies Association, which owns and runs George Washington's home. The VFW buys the Vietnam memorial. There is much bidding for the Jefferson and Washington monuments. Nobody wants FDR's, so it's torn down and the land sold to a farmer. (With the federal government cut back to its constitutional size, much of Washington reverts to productive uses like agriculture, as in late 18th century.)
DAY TWENTY-ONE: The computerized financial and political dossier maintained by the government on every American is erased. The public wanders through the federal offices to make sure, in a reprise of the East Berliners' visits to Stasi headquarters.
DAY TWENTY-TWO: Equal rights are granted to all Americans, even members of non-victim groups. There is no affirmative action, no quotas, no set-asides, no public accommodations laws. Private property and freedom of association are fully restored.
DAY TWENTY-THREE: The EPA is cleaned out, with all "clean air" and similar big-government laws repealed. Ten thousand lawyers leap from their balconies. Private property is established in air and water. Americans harmed by pollution are free to sue the polluters, who are no longer protected by the federal government.
DAY TWENTY-FOUR: Americans are given complete freedom of contract, restoring rationality to malpractice and product liability law.
DAY TWENTY-FIVE: Government scrambles for more assets to sell (i.e., the National Zoo, also known as Washington, D.C.) to pay off the liabilities of the privatized Social Security system.
DAY TWENTY-SIX: Porno artists have to earn their own livings, as the National Endowment for the Arts tries to raise its budget through sidewalk painting sales.
DAY TWENTY-SEVEN: Foreign aid is outlawed as unconstitutional, unjust, and un-economic. Foreign politicians have to steal their own money. The World Bank, IMF, and United Nations close their super-luxurious doors.
DAY TWENTY-EIGHT: The American people are given the unrestricted right to keep and bear arms.
DAY TWENTY-NINE: The Defense Department is reoriented towards defense. American troops come home from all around the world. We adopt a policy of armed neutrality, remembering the Founding Fathers' teaching that we could not have an empire abroad and a constitutional republic at home.
DAY THIRTY: All tariffs, quotas, and trade agreements are put through the shredder. Americans can trade with anyone in the world, without barriers or subsidies. Japanese car prices drop an immediate 25%.
In just 30 exhilarating days, we have established the outlines of free market. Radical? Maybe so. Me, I can't wait until Month Two.
This article appeared in The Free Market for March 1991.
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