If you’ve been following the actions of the Federal Reserve, the Treasury Secretary, and big spenders in government, it’s quite clear that our economic woes won’t be over any time soon. In fact, we’re potentially headed for a cataclysmic disaster (if that’s not repetitively redundant enough for you).
The Fed has lowered interested rates to effectively zero, and is now embarking on massive quantitative easing (a fancy euphemism for printing money) which could ultimately result in the destruction of the U.S. Dollar.
China is buying less and less of our bonds, and foreign governments are holding less and less dollars in favor of the Euro or other currencies, and there are even calls to have the dollar replaced as the world’s reserve currency.
US Treasury Secretary Timothy Geithner has gone to China to calm the fears. However, even before he arrived, a Chinese central bank spokesman gave Geithner the message that the US should not assume China will continue to finance Washington’s extravagant budgets. The governor of China’s central bank is calling for the abandonment of the dollar as reserve currency, using the International Monetary Fund’s Special Drawing Rights in its place.
The method by which the Fed “prints money” is by creating money out of thin air and then uses this money to buy our own Treasuries.
Washington’s financial irresponsibility has brought pressure on the dollar and the US bond market. Federal Reserve Chairman Bernanke thought he could push down interest rates on Treasuries by purchasing $300 billion of them. However, the result was to cause a sharp drop in Treasury prices and a rise in interest rates.
As monetization of federal debt goes forward, US interest rates will continue to rise, worsening the problems in the real estate sector. The dollar will continue to lose value, making it harder for the US to finance its budget and trade deficits. Domestic inflation will raise its ugly head despite high unemployment.
The incompetents who manage US economic policy have created a perfect storm.
…
Life for most Americans will become truly stressful.
Quote of the Day: “This is my long-run forecast in brief: The material conditions of life will continue to get better for most people, in most countries, most of the time, indefinitely. Within a century or two, all nations, and most of humanity, will be at or above today’s Western living standards. I also speculate, however, that many people will continue to think and say that the conditions of life are getting worse.” — Julian Simon
The 1970s were bad. We had high inflation plus bouts of high interest rates, high unemployment, and high oil prices punctuated by severe gasoline shortages. Major American companies struggled to survive, factories closed, and the industrial north became known as the Rust Belt.
Major intellectuals talked of limits to growth and a bleak future that might even include an ice age. It was common in those days to think that things could only get worse, but a man named Julian Simon thought otherwise…
If Ehrlich was right, and limits to growth were near at hand, then prices would rise as resources depleted. But Simon argued that our greatest resource is human ingenuity — the power of billions of human minds to constantly devise ways to do more with less.
Ehrlich bet that the price of five metals would be higher a decade later. Simon bet that they would be lower.
Simon won the bet. And so did humanity.
Things got much better after the 1970s, exactly for the reasons Simon proposed. Human minds figured out how to do more with less, but…
It’s important to note a stipulation of Simon’s bet with Ehrlich. The resources on which the bet was based had to be non-government controlled. The reason is simple…
* A few hundred politicians, or a few thousand bureaucrats, cannot possibly have sufficient knowledge to manage complex economics, solve complex problems, or match the brain power of billions of people operating in a free market.
* But politicians do have the power to distort the price signals that coordinate the free market, and that provide the incentives to accomplish more with less.
Simon won his bet because the free market is nothing less that the combined operation of billions of human minds coordinated by free floating prices. The bleak 70s turned into the prosperous 80s and 90s precisely because politicians and bureaucrats, both in the U.S., and around the world, stopped doing specific things to hamper the many-minds of the free market. Here in the U.S. …
Based on then-Senator Obama’s voting record regarding gun rights, our current president could arguably be considered the most anti-gun president in our nation’s history. That, along with an anti-gun Congress, the United States could be headed for more tyranny.
As Scott McPherson of The Future of Freedom Foundation pointed out, similar to the right expressed in our Second Amendment, the English have a right to bear arms as expressed in English Declaration of Rights (1688). Nonetheless, in 1997, handgun ownership was completely banned.
Given the leftist atmosphere in U.S. politics currently, alongside the wiggle room that Justice Scalia left in the Heller decision (“Like most rights, the right secured by the Second Amendment is not unlimited.”), we could be in trouble. As McPherson puts it,
Don’t bet your life, or your children’s or grandchildren’s freedom, that 50 or a 100 years from now a sufficiently reconstituted and “progressive” Court won’t consider it a “reasonable restriction” of your “not unlimited” right to make firearms so difficult to obtain that armed self-defense becomes a thing of the past.
Government will become more arbitrary, restrained only by good sense and decency — virtues not commonly found in those holding great power. At that point, the American citizen becomes a subject — one step removed from a serf — then a slave. Whatever verbal calisthenics or contortions legislators or judges may employ to convince you otherwise, that was the greatest fear of the Founding Fathers, and the very reason early American statesmen demanded that the right to keep and bear arms “shall not be infringed” — period, end of discussion.
McPherson also explains our natural right to gun ownership in a way I’d not heard it before: we don’t need the 2nd Amendment to deem all federal gun restrictions illegal.
Freedom of speech, of the press, of the right to peacefully assemble, to petition for redress of grievances, to trial by jury, and to be secure from unreasonable search and seizure, and even a statement protecting rights not listed — all are found in the first 10 amendments to the Constitution, the Bill of Rights. Even if there were no Second Amendment, the right to keep and bear arms would fall under the Ninth Amendment’s protection of unenumerated rights, but gun ownership was considered so important that it too was mentioned specifically.
Quote of the Day: “The coming debate is not just about the freedom to make one’s own medical decisions. It is about life and death. If we insist on a dynamic and competitive market, health care will be better, cheaper, safer, and more secure. If we go in the direction of new government programs, mandates, and price controls, we will see higher costs, more medical errors, more uncoordinated care, and more lives lost because people with government “insurance” nevertheless couldn’t find a doctor who would treat them.” — Michael F. Cannon, Director of Health-policy Studies at the Cato Institute
* Be long, complicated, and packed with special interest favors
* Have massive consequences, both intended and unintended
* Add hundreds of billions of dollars to our already cancerous national liabilities
You can also bet that…
* More of your health care decisions will be dictated by bureaucrats, in a desperate attempt to control costs
* Almost no member of Congress will read the bill, or really understand it
* Any problems the bill creates will last for decades, and perhaps forever
Even so, many Americans want Congress to act, and it’s easy to see why. Millions of people…
* Fear losing their health insurance if they lose their jobs
* Don’t have health insurance through their employers and find it too expensive to buy as an individual
* Face bankruptcy if they have an expensive illness
* Find it hard to see a doctor, and are dissatisfied with the experience when they do see one
Doctors too are dissatisfied, and they’re quitting in droves. The resulting overflow of patients is flooding into hospital ERs, straining them to the breaking point. These problems make people feel desperate, and eager to believe political promises. But if they do…
They’ll regret it for the rest of their shortened lives.
We can know this because the proposed reforms further destroy the free market, just like earlier government policies that created the current problem. Think about it… Read More »
Quote of the Day: “Students of American history will recall that the important place where work gets done in the legislative body, almost without exception, is in the committees, more so than on the floor although sometimes more attention is paid to the floor.” – Paul Sarbanes
Each year the Iraq-Afghanistan spending bill comes loaded with extras that remind us how much we need the One Subject At A Time Act.
Because few in Congress will vote against a bill that “supports the troops,” this bill provides an opportunity for legislative abuse . . .
The House and Senate conference committee will soon meet to work out differences in this year’s bill. It is unknown what tricks they’ll have up their sleeve, but the bill, H.R. 2346, is already bad enough. In addition to funding the wars, there is money for the BATFE, federal prisons, foreign aid, the War on Drugs, forest fire management, and other programs. The total price tag is over $900 per family.
Downsize DC’s proposed One Subject At A Time Act (OSTA) would prevent the bundling of these different topics into one bill. Instead, each subject would be voted on as a separate bill. Necessary bills will still pass, but unpopular measures won’t. The country would be spared the cost of programs most members of Congress didn’t want in the first place.
If members of Congress had common sense, they would actually want to live under OSTA’s constraints. Then they could vote for a reasonable and necessary bill without being forced to accept unnecessary, unrelated provisions. Whether the U.S. should fight these wars, and whether the federal government should provide more money for wildland fire management, are two completely unrelated questions. Members of Congress who support one but oppose the other shouldn’t be forced to either accept both or reject both.
Demand common sense from Congress. Tell them to pass the One Subject At A Time Act. In your personal comments . . .
Yesterday’s Rand Paul Money Bomb was a success. The goal of breaking $50,000 was reached shortly before midnight.
The total raised for the day, according to RandPaulGraphs.com was $24,391.51. That’s not too shabby for something that was hardly promoted (elsewhere). Also it was for a potential candidate not an actual candidate. Rand Paul is at the exploratory committee stage of his potential candidacy.
I’ve pointed out in the past that I think Rand Paul is more charismatic and tolerable to neo-conservatives than his father. Rand seems to know how to frame his father’s message in an acceptable way. A case in point is this recently released video where he discusses foreign policy.
These were the words of CFL member Angel Robinson when talking to Glenn Beck about Ron Paul’s Campaign For Liberty and his bill (HR1207) to audit The Federal Reserve.
I can think of no better phrase to sum up what all Americans should be.
We all should be spokespersons for liberty.
I find it interesting that she didn’t use Ron Paul’s name once during the interview, yet talked about his organization and his bill. I wonder why?
There was hope that with the election of Barack Obama the United States could regain better foreign relations with the world after the ‘W’ years. It appears more and more likely that the only thing that is going to “change” in that regard under Obama are the words. The actions are really what needs changing.
Word without action is like an empty gas tank in an impeccably restored automobile. Sure it looks nice, but it’s not going to get you anywhere.
The wonderful Robert Higgs provides us with some more evidence that this is true in a recent article. He documents his recent trip to Turkey where he and his wife get a pleasant surprise:
When Metin inquired as to how we liked President Barack Obama, we replied that we dislike all politicians. He nodded as if he understood and agreed with our sentiment. Then, after a brief pause, he said. “But there is one who is different.” After pausing again, as if he were searching his mind, he said simply: “Ron Paul.” Quickly following up, he declared emphatically: “I love Ron Paul!” Nearly struck dumb by this amazing declaration, we asked how he knew about Dr. Paul. He said that everybody in Turkey knows about him, and many Turks like him better than other politicians.
When we informed him that we are personally acquainted with Dr. Paul, it was almost as if we had told him we are personally acquainted with some world-famous celebrity. Elizabeth confessed to him that although she normally steers clear of politics, she had joined a meetup group to promote Dr. Paul’s Republican presidential candidacy and had placed a big Ron Paul sign in front of our house. Instant solidarity!
Later in the article, Ron Paul is deemed worthy of being President of Turkey. This is just further proof that Ron Paul was the candidate of choice to effectively repair America’s standing in the world.
This is just a friendly reminder that today is Rand Paul’s mini Money Bomb. Rand has said that if he were to receive a large amount in donations to his exploratory committee he would run regardless of what Jim Bunning decides to do.
If you believe, as I do, that Rand Paul represents new hope for the Republican Party then please….
I can’t help but wonder if Hugo Chavez is Barack Obama’s role model. Mr. President, I don’t want to own GM. If I did I would have bought the stock. Now you are nationalizing General Motors. Your fascist flatulence is getting more stinky with every new intervention.
Today, GM files for bankruptcy protection. It comes as no surprise to anyone. At the beginning of May I shouted, “Jesus H. Chrysler!“, when Chrysler filed for bankruptcy protection. At the end of that article I said, “Next up, GM.” Sure enough it is now GM’s turn.
WASHINGTON – General Motors, the humbled auto giant that has been part of American life for more than 100 years, will file for bankruptcy protection on Monday in a deal that will give taxpayers a 60 percent ownership stake and expand the government’s reach into big business.
Well, how nice. I wonder if we’ll get an employee discount? I could ride around in a new GM car with a bumper sticker that reads:
Then again, it will have to be a pretty deep discount for me to consider buying a Government Motors car.
Apparently, Obama took an oath to defend a different Constitution than the one we all know and love. Every page of Obama’s Constitution must have the following words: “This Page Left Intentionally Blank.”
Liberty Maven
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