The global economy has become so unbalanced that even government ministers who would normally have trouble explaining supply or demand clearly recognize that something has to give. To a very large extent the distortions are caused by China’s long-standing policy of pegging its currency, the yuan, to the U.S. dollar. But as China’s economy gains strength, and the American economy weakens, the cost and difficulty of maintaining the peg become ever greater, and eventually outweigh the benefits that the policy supposedly delivers to China. In the first few weeks of 2011 fresh evidence has arisen that shows just how difficult it has become for Beijing.

Twenty years ago, China’s leaders decided to ditch the disaster of economic communism in favor of privatized, export-focused, industry. The plan largely worked. Over that time, China has arguably moved more people out of poverty in the shortest amount of time in the history of the planet. But somewhere along the way, China’s leaders became addicted to a game plan that outlived its usefulness.

In order to maintain the peg, China must continually buy dollars on the open market. But the weaker the dollar gets, the more dollars China must buy. And with the U.S. Federal Reserve pulling out all the stops to create inflation and push down the dollar, Beijing’s task becomes nearly impossible. Last week, it was announced that China’s foreign exchange reserves, the amount of foreign currency held at its central bank (mostly in U.S. dollars), increased by a record $199 billion in 4th quarter 2010, to reach $2.85 trillion. These reserves currently account for a staggering 49% of China’s annual GDP (if the same proportional amount were held by the U.S., our measly $46 billion in reserves would have to increase 163 times to $7.5 trillion).

In order to buy these dollars, the Chinese central bank must print its own currency. In essence, China is adopting the Fed’s expansionary monetary policy. In the U.S. the inflationary impact of such a strategy is mitigated by our ability to export paper dollars in exchange for inexpensive Chinese imports. Although prices are rising here, they are not rising nearly as much as they would if we had to spend all this newly printed money on domestically produced goods. The big problem for China is that, unlike the U.S., the newly printed yuan are not exported, but remain in China bidding up consumer prices. As a result, inflation is becoming China’s dominant political issue.

It was recently announced that in November China’s consumer price index rose 5.1% from the same time a year earlier, with food prices rising more than 10%. As unrest builds, the Chinese government has unleashed a series of policies to address the symptoms of the disease while ignoring its root cause.

For the remainder of this article, plus a more detailed analysis of global food inflation by Michael Pento and articles on other investment topics, please see the latest edition of Euro Pacific’s The Global Investor Newsletter.

Peter Schiff is CEO of Euro Pacific Capital and host of The Peter Schiff Show.

However, it is generally thought by most in society that corruption need not be a direct function of power, but rather an unfortunate coincidence of these systems of power over a period of time. As part of his best-selling Road to Serfdom (which has gained renewed interest in light of its recent feature on television pundit Glenn Beck’s show), Nobel Prize winner F.A. Hayek sought to discredit this notion of coincidence in a chapter he entitled “Why the Worst Get on Top.” In his own words, Hayek initiates the discussion in this way:

“It is the belief that the most repellant features of the totalitarian regimes are due to the historical accident that they were established by groups of blackguards and thugs … Why should it not be possible that the same sort of system, if it be necessary to achieve important ends, be run by decent people for the good of the community as a whole? … [Yet] There are strong reasons for believing that what to us appear the worst features of the existing totalitarian systems are not accidental by-products but phenomena which totalitarianism is certain sooner or later to produce.”

Those “strong reasons” were the substance of a chapter whose message can give pause to even the most well-intentioned of progressives in today’s political climate: perhaps the expansion and concentration of power attracts those who would plunder the population and take advantage of the weak in society, rather than those who would use such power for any perceived benefit. Specifically, Hayek noted three crucial points that lead socialist regimes into the hands of ruthless totalitarian dictators as a predictable consequence.

1. The person/party perceived as “strong” will be desired by the greatest number in society. By “strong,” Hayek means “able to make action quickly”; most opportunities for expansions of government power or regime changes happen due to a discontented, impatient populace. Typically, the largest group in society is the one which is in such a position to affect change in their direction; but (a) the largest group is the one that is least original and independent due to their lack of education and/or intelligence; (b) a potential dictator can most easily convert those who are docile and gullible from outside this group, further weakening the constituents who bring a leader to power; and (c) it is easier to unify people in a negative program (hatred of an enemy or envy of the rich) than any positive course.

2. All collectivist programs serve a limited group by nature. Collectivism (the opposite of individualism) groups people and treats those groups as one coherent entity. Since socialists regard capital as belonging to the nation, rather than belonging to humanity, the totalitarian program will serve the ruling elite as its advantaged “collective.” From the opposite perspective, the individuals in such a collectivist society – which, Hayek is clear, all centrally planned economies are indeed collectivist – feel inferior to those in the groups that are advantaged by the state, and will join the group if they feel that membership will confer superiority over outsiders. Consequently, these individuals are free of the many moral restraints that they feel when acting on their own behalf, because they need only act on behalf of the group (the party in power). These are the people who are naturally in position to receive leadership assignments in the party.

The most important corollary to the distinction between collectivist and individualist society is that in order to achieve the “ends” in central planning, the would-be leaders must create centralized power, which infinitely heightens that power. Hayek explicitly states that the competitive (i.e. free market) system is the only system designed to minimize, by decentralization, the power exercised by man over man.

3. Collectivist morals contrast with individualist morals. Collectivist “morals” view the ends as the only noble goals, whereas individual ethics teaches us that ‘the end justifying the means’ is the denial of all morals. Anyone in a position within the elite/ruling class must be willing to do things which are “bad” on an individual level, but good for the nation as a whole. As such, these positions attract people who are largely immoral in the individual sense to begin with.

Hayek’s three-pronged approach demonstrates why “the worst getting on top” is systematic and inevitable, rather than subject to random chance – in a socialist or communist system. However, Hayek’s analysis ends there: an effective argument against the specific form of government which he was combating in Serfdom (published in 1944 at the height of WWII), but an argument that stayed within that realm. Applying the argument against centralized power in the form of idealistic socialist/communist states ignores the bigger picture, which can be traced throughout the history of government and politics: Centralized power is, in and of itself, an attraction to the worst elements of society, regardless of the political system in which it is contained.

In his influential work Common Sense, Thomas Paine echoes Hayek’s unspoken theme, applying the corrupting influence of concentrated state power to the monarchy of England while appealing for independence:

“Sir William Meredith calls [England] a republic; but in its present state it is unworthy of the name, because the corrupt influence of the crown, by having all the places in its disposal, hath so effectually swallowed up the power, and eaten out the virtue of the house of commons … Of more worth is one honest man to society, and in the sight of God, than all the crowned ruffians that ever lived.”

Here, again, Paine conflates the power with the specific political system and ruling class with which he is familiar. A monarchy, being a system with a highly visible leader entrusted with the power of the state, is similarly affected by the influence of power as Hayek’s examples of Germany and Italy so many years later.

Today in America, we face a government that utilizes collectivism perhaps to a greater extent than did Hayek’s totalitarian Germany. We face a government which taxes us to a far greater extent than did Paine’s English crown. We face a government which has sold our rights to the highest bidding lobbyist, a government which creates laws and agencies at the whim of its bureaucratic agents regardless of its Constitutional authority to do so. And despite the best efforts of the Founders to diffuse and limit the powers of the state in America, we find ourselves facing a state with one of the most concentrated centers of power in the world: Washington, DC, the Mecca of corporatists, statists, and fascists alike. This, despite the American form of government being a republic.

Perhaps, as Paine once remarked about England, “it is unworthy of the name.” Or perhaps no entity should be trusted with the myriad duties which our government now claims as its responsibility.

by John Browne, Senior Market Strategist, Euro Pacific Capital

Over two thousand years ago, China began to build its Great Wall in order to keep nomadic tribes and marauding armies from crossing its borders. In the last few decades, China has built another protective barrier, a ‘Great Firewall,’ to keep socially disruptive web content from reaching its citizens. American companies have long acquiesced to this censorship charade in order to have access to China’s booming online market. Last week, Google changed its mind, shutting down its regulated site on the mainland and redirecting people to its uncensored Hong Kong portal. This laudable act of defiance indicates that China’s bustling marketplace is straining its authoritarian political regime. We expect the latter to yield.

With a population of over 1.3 billion,[i] GDP growth of some 8.9% in 2009,[ii] and some $2.4 trillion in official reserves,[iii] China already is a major global force to be reckoned with. Having recently surpassed Japan as the world’s second largest economy and Germany as the world’s largest exporter, China is fast approaching superpower status.

by John Browne – Senior Market Strategist, Euro Pacific Capital

President Obama’s State of the Union message only serves to reinforce my forecast that investors will continue to find better returns in markets outside America and in currencies other than the U.S. dollar. Indeed, the reward gap may well increase.

Nothing in the President’s speech indicated willingness to do the hard work of cutting spending. Rather, he reiterated his commitment to a costly new healthcare entitlement and more spending on make-work programs. Only days later, his budget acknowledged that, even before factoring in the cost of his proposals, the federal government is unlikely to be in surplus for the foreseeable future. In response, Moody’s has issued a warning that the United States’ triple-A credit rating is not unassailable. In short, the trend set some ten years ago will continue.

Since 1999, those who invested in U.S. stocks, as measured by the S&P Index, have lost about half of their wealth, in real terms.[i] On the other hand, those who invested abroad, measured by the Morgan Stanley Emerging Market Index,[ii] [iii] have doubled their investments in real terms. This is because capitalism is flourishing abroad, while being curtailed progressively in so-called advanced economies, where the projected aggregate growth rate for 2010 is now only some 2.5 percent. Somewhat optimistically, this assumes no double dip recession. [iv]

Most of the emerging economies are far less leveraged than those of the advanced countries and are relatively well insulated from the massive dollar deleveraging that began in 2007. Crucially, their government spending is geared largely to infrastructure and far less to expensive government bureaucracy and wealth-depleting entitlements. Most importantly, even formerly communist governments, like that of China, have embraced free-market capitalism, while many in the advanced governments are flirting with socialism.

As the most leveraged of the major economies, America in particular faces great problems with regard to regenerating consumer demand. Looking at the future of U.S. stock markets, the following five bearish observations stand out.

First, it appears that the ruling Democratic Party is out of touch with the realities of economics. Paying little apparent heed to their sensational defeat in Massachusetts, President Obama and his Democrat Congress are making no realistic attempt to rein in, let alone cut, runaway government spending. Yet, the current path leads to spiking debt costs, huge tax increases, and unprecedented U.S. dollar debasement. In addition, because many Congressional Democrats were elected by disaffected conservatives during the Bush years, the party cannot agree to terms on reform legislation. This leaves businesses fraught with uncertainty as to how they will be impacted.

Because of the focus on new spending, we have only seen empty gestures with regard to tax-cutting. This is the ultimate form of “stimulus,” but one that must be earned through reduced spending. While President Obama has talked tax cuts, his actions indicate only a redistributionist impulse to set up federal programs for which business and the productive classes must pay. Whether or not that satisfies his ideological goals, it is a recipe for economic disaster.

Second, while the Fed has signaled that it will hold interest rates down for the foreseeable future, it is likely that in the medium and long end of the yield curve the market will soon force rates higher. This will lead U.S. bond and equity markets to better reflect their real values, and end the nominal recovery we have seen thus far.

Third, despite increased government hiring in wealth-consuming jobs, total employment, and especially private, wealth-creating employment, continues to fall. [v] Those jobs are moving abroad. Last year, the U.S. witnessed the steepest drop in demand for H1B visas in recent history. [vi] This indicates that America is losing its appeal as the place for the world’s enterprising young minds to strike it rich.

Fourth, the Dow has risen at a historically fast rate over the past nine months, while volume has thinned. [vii] In other words, the rally is being pushed by speculative traders, not long-term investors. It is, therefore, highly vulnerable to collapse.

Finally, political uncertainty, rising unemployment, and an outlook for increased taxes are destroying any looming consumer confidence. Fourth-quarter GDP grew an annualized 5.7 percent on inventory restocking, but no one is in the mood to spend. [viii] Consequently, those stockpiles will drag on GDP growth for several quarters.

With this somber picture at home, it was not naïve to have hoped the President would shift to a common sense agenda in the State of the Union. Unfortunately, this Administration may not have the fortitude to implement an austerity program. One way or another, the U.S. is going to have to face the economic reality; the longer we wait, the bigger head-start we give to our competitors in the developing world.

There has never been a pure free market capitalistic system just as there has never been a pure communist or socialist system, where there is government ownership of the means of production and each individual has equal access to society’s resources. However, we can rank economies as to whether they are closer to capitalism or closer to communism or socialism. If one ranked countries according to whether they were closer to the capitalistic end of the spectrum or the socialistic or communistic end, then ranked countries according to per capita GDP and finally rank countries according to Freedom House’s “Map of Freedom in the World,” he would find a pattern that is by no means a coincidence. The people in those countries closer to the capitalist end of the economic spectrum have far greater income and enjoy greater human rights protections than those toward the socialist and communist end.

According to the London Telegraph article, Moore’s film features priests who say capitalism is anti-Christian by failing to protect the poor. This is pure nonsense and revealed as such by asking, “If you’re an unborn spirit, condemned by God to a life of poverty but allowed to choose the country in which to be poor, would you choose a country near the communist end of the economic spectrum or the capitalist end?” If you chose the United States, you’d find that according to the government surveys, the typical “poor” American has cable or satellite TV, two color TVs, and a DVD player or VCR. He has air conditioning, a car, a microwave, a refrigerator, a stove, and a clothes washer and dryer, and whether he has health insurance or not, he is able to obtain medical care when needed. Try to find that in Cuba, Russia, China or North Korea. If we buy into the nonsense of Moore’s priests, the world’s poor people are incredibly stupid. Whether fleeing legally or illegally, their destination country is likely to be closer to capitalism than their departure country.

Go read the whole article here.

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I’ve gotten some feedback on the subject of deregulation, and the effect of greed.  Many are quick to demonize it, but I think we all need to slow down and take a look at what greed really is, before we admonish the “greedy”.

Interestingly, greed, is one of the 7 deadly sins, so we should strive to not be greedy, right?  Well, greed is defined in several different ways, but the most unbiased true definition (not relating to material wealth – I’ll explain why this is important in a moment) of greed is: An eager desire or longing; greediness; as, a greed of gain.  Is this not merely an extension of self interest?  What is self interest?  Self interest is defined as personal interest or advantage.  Everyone acts in ways of self interest, some more than others.  The reason is because life is a competition, like it or not.  You cannot beat the self interest out of anyone, and that is the paradoxical nature of self interest, i.e., greed.  To clarify my point, allow me to give several examples.

1. Early in life, we play games.  The object of a game is to win.  The desire to win is an act of self interest.  Yes it is fun to play, but winning and losing is part of the game, and the desire to win is part of human nature.  If the true object of the game is only to have fun, why do we keep score?  Why do we play at all?  Can we not find more fun and productive things to do if the object is “fun”?

2. When we go to school, we get graded on our performance.  We strive to get good grades based on our performance, and to gauge how we are faring against our peers.  Some learn faster, or in different ways, than others.  It is in our self interest to get the best grades possible, so that we not only know we are learning, but to ensure that our future will be bright, by being accepted into higher educational facilities which boast better educational practices than others.

3. When we are done with school, we hope that we’ve learned what we needed to, and that we have the skill set necessary, for a particular job.  It is in our self interest to get the best job possible (best environment, best pay, best benefits, etc) that most closely fits our needs.  We hope to climb the ladder (if we work for someone else) because we bust our humps every day to try and prove that we are worthy of higher pay, better benefits, better environment, more responsibility, etc.

4. If we open our own business, it is in our self interest to ensure the business survives so that we can support ourselves and our family, so that we do not go on the government doles, which brings me to my next point.

5. Those on welfare also act in self interested ways.  Some would say that they are selfish, others would say greedy, and I can certainly see that point.  This is not to say that I think we should not help anyone, we should be able to help those that cannot help themselves (disabled, physically or mentally, children with no family and cannot fend for themselves yet).  A hand up, not a hand out.  For those that can help themselves, they are simply acting in a self interested way to “get something for nothing”. It is far too easy to “game” the system.  Want more money?  Have another kid.  Get hurt to collect disability also, etc.  Getting a welfare handout check is acting not only in a way of self interest, but it is also at the expense of others.  Does anyone seriously believe that the government can make the poor “rich” by “spreading the wealth around”?  Where is the incentive to work?

6. Politicians act in self interested ways.  It may not be for money, but for position and power.  If you think that those you elect to office, no matter D or R, really want to “help” the little guy, you are sadly mistaken.  Politicians are no different than the public.  George Carlin said something like, if you have a greedy, ignorant population, you will have greedy, ignorant politicians.

7. People who vote do so in self interested ways.  What will my politician do for me, or my group?  As if we’re all oppressed, right?  Many seem to have forgotten how friggin awesome our country is/was because of our Constitution and it’s limits on government, and the personal freedoms our Bill of Rights protects.  It only ever has been, and always will be, the other guy who was at fault, right?  As I’ve pointed out before, when the government gives someone something, it has to do it at the expense of someone else.

8. Even religion and clergy act in self interested ways.  They always want a little more.  The church needs an addition, they need to grow their congregation, etc (and notice how it’s almost always tied to “you need to give more to the church”).

Here’s my point.  We cannot prosecute or persecute people for acting in self interested ways, and so quickly take it to the level of “greed”, because we all do it.  If you think you do not act in greedy ways, you are kidding yourself.  I only cherry picked the most politically palatable examples above.  Really, make an honest assessment of your actions and see how many you can classify as acting only in the interest of others.  There was a Friends episode (unbelievably) that dealt with this.  Even when you give your time and / or money to a charitable (by your own free will, by the way, not by government mandate) organization, it still makes you feel good, so even it is not completely selfless.  Put yourself in the position of others who you classify as greedy.

Take a corporate CEO for example.  You think they make too much money.  Compared to what, the average worker?  Do you have any idea the kind of pressure they are under on a daily basis?  Do you really know how much they sacrifice in regards to a truly coherent family life because of their work?  I highly doubt it.  They are generally in the spotlight more than they’d like, and have to put up with the stress of the livelihoods of hundreds, or thousands, or hundreds of thousands, or demanding employees, stockholders, boards of directors, and the general public.  Do they create that much wealth for the company and for the stockholders?  Maybe, maybe not.  But you cannot, and should not, demonize them for what they make.  If you were in their position, I seriously doubt you would turn down a luxurious contract.  And besides, there are free market mechanisms in place that deal with this already.  Boards of directors hire and fire CEO’s.  Stockholders elect the boards of directors.  If you don’t like the company, or think the CEO makes too much, don’t buy the stock of the company.  Don’t buy products the company makes, nobody is forcing you to buy what they sell .  If you own their stock, elect a board, or appeal to the board, that will act in your interest (aha, there’s that caveat again – self interest of the best stock price possible – oops).  If they are truly incompetent managers that don’t deserve the pay, the company will go bankrupt.  If you don’t buy the product they sell, or have stock in the company, why do you care at all?  Why do you want to control them?  What gives you that right?

Now here’s where we’ve really jacked up.  The politicians we’ve elected are not allowing this to happen.  The free market mechanism that deals with incompetence (bankruptcy) is not being allowed to function.  Is it in my interest to bail out a car company?  No, but I’m being forced to pay for it anyway, for the “greater good”.  Sooooo, now I’m technically paying for cars with my, yes, my, tax money (or eventually, inflated fiat currency), but I’m not actually getting a car?  That’s wrong.  How can anyone justify that to save some jobs in the short term?  Why doesn’t the government just start their own car company?  They know what’s best for us, anyway.  They’ve already appointed a car Czar.  Welcome to Communist Russia, we’d be glad to sell you a Trabant.  It only costs $99,999, but with tax incentives, the cost to you (that you can see) is only $29,999!  (You will actually pay the full $99,999, but we’ll tell you that we’re taxing those “greedy rich” more).  Isn’t that great?!  You are supporting American workers, and inflated, over powerful unions!  Everyone is happy!  Until they’re not.

This almost always comes back to regulation, and deregulation.  The real job of the government is not to regulate the hell out of everything, it is arbitrary.  Prosecute fraud, yes.  But they should not dictate what people should make.  You vote with your dollars every day.  You vote for politicians every 4 years.  Do the math.  The market is absolutely, unequivocally, the most efficient and best resource for regulating the market.  The government is always a step behind.  Derivatives of mortgages blew up, so we need to regulate derivatives.  Uh, you don’t need to, Barry, the market has, or is trying to, learn it’s lesson and cleanse the mess of derivatives by bankrupting the businesses that engaged in it.  Miring us in propagandist nonsense that a company is “too big to fail” is utterly farcical.  I think that it is simply meant to paper over the real reason they failed, trying to make a profit (ooohhhh, greedy) in an over-regulated, ever changing regulation, and over-taxed environment, with governmental decrees on how to conduct business.  Here’s the slippery slope argument.  If the government thinks they can do everything better, why don’t they just do it and take over everything?  Oh, that’s right, I’ve said it before, it’s because socialism doesn’t work.  Liberty and freedom work.

Leftists say that those on the “right” (this includes me, as I’m a Libertarian, limited government kind of guy) are always the nay-sayers.  The party of “no”.  I say, that is separatist nonsense.  When I say no to bailout, I say yes to market consequences for poor decisions.  When I say no to over-arching government programs, such as the poorly run Department of Education, I say yes to private schools, like Charter schools and Montessori, and I say yes to variations in the education of our children.  Because I do say no to everyone thinking, acting, and feeling the same way.  When I say no to the regulation of food products and safety on a national scale, I say yes to victory gardens, community gardens, and farmers markets. I therefore, by extension, say yes to limitations of the contamination of the food supply, as large scale regulation increases the incentive for farmers to become huge corporate conglomerates that spray our food with herbicides and pesticides that have been proven to cause cancer, heart attacks, brain aneurysms, and myriad other health issues.  When I say no (by repeal) of all Presidential Executive Orders, I say yes to the true checks and balances nature of our three branch system of federal government.  I don’t want a dictator.  If I did, I’d move to Cuba, or Venezuela.  (psst, that’s why refugees flee those countries, because of the dictators)  When I say no to ethanol subsidies, I say yes to lower food prices.  When I say no to government spending, I say yes to sustainability without the destructive debt loads for the entire country!  And finally (for this rant) when I say NO to the Federal Reserve Bank(!) I say YES to sound and honest money.  Sound money is the foundational pillar of keeping our government and our markets honest.  Restore that, and most of these niggling regulatory issues will be solved.

“Permit me to issue and control the money of the nation and I care not who makes its laws.” — Mayer Amsched Rothchild

It’s a rigged game folks, and we’re bickering with each other over whether the ball should be pigskin or cowhide.  Here’s another great quote:

“There are a thousand striking at the branches of evil for every one who is striking at the root.” — Henry David Thoreau

…[Cultural Marxists] took over and began acting, well, like lunatics. I learned from the local media that the former academic vice president had rejected an applicant for a top job because the applicant “wasn’t black enough.” The job was academic vice president for diversity and the interviewee was an African-American man with very impressive credentials. According to news reports, this man was told that he was well qualified, but that the College preferred an African-American with somewhat darker skin.

So here was a man who had probably been discriminated against in employment during his lifetime who had reached the peak of his professional career, and was interviewing for what was probably his dream job. And he is told he wasn’t getting the job, once again, because of his skin color. And you probably thought “lunatic” was too strong a word.

This is a very entertaining article. Highly recommended.  Read it here.

The recent financial crisis has renewed interest in old issues. The Bush administration has announced plans to buy $85 billion in preferred stock in what are (for the time being) private financial institutions, like Bank of America, J.P. Morgan, Wells Fargo, and Morgan Stanley. The total commitment by the Treasury is set at $250 billion. While this move by the Treasury Department into the financial industry is unique in American history, it has precedents elsewhere, and has been debated many times.

Karl Marx proposed “centralization of credit in the banks of the state, by means of a national bank with state capital and an exclusive monopoly.” Years later, so-called “market socialists” like Oscar Lange, Abba Lerner, and H.D. Dickinson proposed state control over credit and financial capital. While these market socialists accepted trade and the use of money with consumer goods, markets for capital goods would be simulated and markets for financial capital would be wholly replaced by central planning. Capital investment would therefore be determined by state officials, rather than by competition for funds in financial markets. Lange was particularly clear about how the state would determine the overall rate and pattern of capital investment. State officials would set the overall rate of capital accumulation, instead of interest rates. State officials would also determine the pattern of investment, instead of profit-seeking capitalists and entrepreneurs.

Finish reading the article here…

The feds are sending all the wrong signals. Is there any reason not to max out every one of my credit cards and purchase as much gold as I can? If the government is getting in the business of forgiving debts then why not include everyone? Oh wait, that’s right, the government is only interested in bailing out those institutions that deserve to fail. A typical family of four with a bit of debt and an upside down mortgaged house is not worthy, at least not directly.

The truth is no institution, no family, and no individual should be worthy of a government bailout. The redistribution of wealth is not supposed to be in the fabric of America. It is getting to the point that one wonders if the next President will be sworn in on the Communist Manifesto rather than the Bible.

This is no longer my America. This is no longer the America of our founders. We are prisoners of our own apathy.

Our Mommy and Daddy government is over-protective. We are not prepared to ever fail and therefore learn our lessons. Keep feeding us your delicious bailouts, your wonderful welfare, your fabulous foreign policy, your terrific taxes, and your lovely lies until we’re fat and drunk on our own stupidity.

Then again, why not keep your bailouts, taxes, welfare, foreign policy, and lies to yourself? Let the Constitution be your parenting guide. Give us the freedom your own parents promised us. Don’t disappoint and embarrass them anymore. Stop protecting us from ourselves.

Let us know liberty. Let us fail. Let us learn. Let us pick ourselves up off the ground stronger and more prepared for the next challenge of our day.

“…this new mission marks the first time an active unit has been given a dedicated assignment to NorthCom, a joint command established in 2002 to provide command and control for federal homeland defense efforts and coordinate defense support of civil authorities.”

“The 1st BCT’s soldiers also will learn how to use ‘the first ever nonlethal package that the Army has fielded,’ 1st BCT commander Col. Roger Cloutier said, referring to crowd and traffic control equipment and nonlethal weapons designed to subdue unruly or dangerous individuals without killing them.”

So, then, what is an unruly crowd?  Is it anything at all akin to the peaceful, park-loving protesters and bystanders who were spontaneously surrounded by SWAT Police in full riot gear and arrested on Labor Day in St. Paul, Minnesota?

Folks, this concerns me.  In fact, quite frankly, this makes me want to go run and find a cave.

Let’s look at the big picture:

1) We won’t defend our borders, and, quite frankly, neither of the two mainstream Presidential candidates are interested in any action on that front. Instead, we’ve got volunteer Minutemen who have to do the government’s duty, from spotting illegal immigrants and alerting authorities on the border of McCain’s home state of Arizona, to building a fence in Texas.

2) We now have greater civil unrest in Mexico, as the Mexican Mafia has now turned to terrorist-like acts of violence against citizens, as opposed to singling out politicians and others involved in the drug trade. In fact, as civil unrest and violence in Mexico increase at our own borders, and even crosses over them into our own nation, the government decides that the most sensible and effective course of action is to label these individuals as “narcoterrorists”. Instead of focusing on the most TRULY sensible and logical next step, working to secure our borders, Washington now uses recent events as a justification for increasing “its investment in the fight against the drug trade by spending $2 billion in counternarcotics aid money to Mexico and Central America through the Merida Initiative.” Well, why not?  The War on Drugs and the War on Terror haven’t been successful so far, so why not throw a couple more billion at the problem, doing the exact opposite of what common sense dictates?

3) Speaking of the War On Terror, has anyone noticed that Osama Bin Laden was never charged with a crime for his involvement in 9/11?  Has anyone noticed that no criteria have ever been suggested towards an identification of success, or victory, in the War on Terror?  Heck, even Asia, which is “home to more Muslims than the Middle East”, believes that “the current US administration has been overly focused on the Middle East”.

So, we’re not accomplishing anything by “addressing threats abroad”, or by fighting a “War on Drugs”, or even with the official Border Patrol.  Yet, we will train our militaries for domestic crowd control?  Congress and the military will put together equipment to stand up a hasty road block; spike strips for slowing, stopping or controlling traffic…, but they won’t defend our borders, or even bother to read Section 8 of the U.S. Constitution, which specifically states that everything they are doing is THE EXACT OPPOSITE of what they are empowered and obligated to do?:

…To define and punish Piracies and Felonies committed on the high Seas, and Offenses against the Law of Nations;

To declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water;

To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years;

To provide and maintain a Navy;

To make Rules for the Government and Regulation of the land and naval Forces;

To provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and repel Invasions;

To provide for organizing, arming, and disciplining the Militia, and for governing such Part of them as may be employed in the Service of the United States, reserving to the States respectively, the Appointment of the Officers, and the Authority of training the Militia according to the discipline prescribed by Congress…

Congress is, at this very moment, collapsing our economy.  Whether you believe that the Wall Street disasters are incidents of negligence or of deliberate fraud and corruption, the end result is the same:  our government has failed us, and it won’t take much more for a total economic collapse.  It would seem to me that, in the event of a total economic collapse, there might be a little bit of “civil unrest”.  Apparently, the U.S. Government also feels that our country is headed down this path, as they are doing more to prepare for “dealing with crowds” than they are about returning to the Fundamentals of the Founding Fathers in an effort to nurture and naturally heal this country back to a position of financial strength.

In at least two spots, Neil perfectly sums up the stance of Ron Paul and the Revolution, paraphrasing “Look, you guys [GOP, McCain, etc.] are the ones who abandoned the party, not me.  I’m going back to what our roots are.”