Debt Will Destroy You

My friend Steph sent me this great link about a potential danger that most people are over looking.

As individuals, we have no problem seeing how dangerous our own personal debt is to our own family’s well-being—especially in this economy. Carrying debt is a form of slavery. But for some reason, we think our government is immune from this. I am afraid most Americans are totally ignorant of the fact that so many other countries control our debt and can call it in at any moment, totally destroying our economy beyond ANYTHING we have ever seen in our entire history. We need to stop being so pompous by preemptively throwing our military all over the globe, demanding everyone else buy up our debt, and living like we have some god-given right to our arrogance. Most of all, we need to stop spending money we don’t have. We may not be very responsible as individuals, but we are even less so as a country...

Ron Paul has been preaching this since the ‘70’s. I am currently reading his book A Foreign Policy of Freedom, which is basically a collection of all his congressional speeches from his entire career. He has always been consistent. He pounds on the stupidity of how we are constantly involved in unnecessary foreign military engagements, the dangers of our uncontrollable use of debt, and how the two things relate and they will eventually bring us down, just like every other “empire” before us. (His 1999 speeches about Bin Laden and terrorist attacks were also down right scary and dead-on two years BEFORE they actually happened.) He has had an incredible record of predicting how our government’s poor decisions have always had a way of turning around and biting us in the ass. Our government needs to stop using force to grow our empire, start treating other nations as partners, not servants, in order to concentrate on building a healthier nation here at home.

Found this song for Brother Jon

You gotta' love the dancin'...

Two Conservatives (and one of them sucks)

People often dislike "Conservatives" because they are hypocritical.

One, they say they believe in people's rights, yet legislate to control people, who they can marry, what they do in their bedrooms, what they can put into their bodies, etc. And two, they say they believe in smaller government, yet, when in charge, grow the national debt faster than their opposition on the left. Their imperialistic military expansion and international interventionism grows the size and scope of government faster than anyone on the left could hope to do on their own.

These "Conservatives" are not Conservatives, at least not in the historic sense. They are Neo-cons. And people should dislike them. They are the greatest rapers of liberty this country has ever seen. Both the left and Neo-cons are evil, but at least those on the left admit to wanting to use the government to control you.

This video sums up the difference between the two "Conservative" camps. After viewing this, you will better understand why I view Bush's Neo-cons and Obama's legions in the same light. They are both Big Government philosophies intent on taking away individual rights and expanding the size of government.

"Ideology is such a powerful force that it has propped up policy inconsistency for more than a century. The left has a massive agenda for the state at home, and yet complains bitterly, with shock and dismay, that the same tools are used to start wars and build imperial structures abroad. The right claims to want to restrain government at home (at least in some ways) while whooping it up for war and global reconstruction abroad.

It doesn't take a game-theory genius to predict how this conflict works itself out in the long run. The left and right agree to disagree on intellectual grounds but otherwise engage in a dangerous quid pro quo. They turn a blind eye to the government they don't like so long as they get the government they do like." -Lew Rockwell intro to Ron Paul's A Foreign Policy of Freedom

The key is, they both want to use government to expand their agendas, doing so in the name of protecting their constituencies, while ignoring the rights of all people.

I am against any side that uses the government to try to control and impede anyone's individual rights, even those I may disagree with on personal or moral grounds. Thankfully, the Bush era has ended, but the rise of Obama does not make us any freer. Get ready to be bombarded by the other Big Government philosophy.

Milton Friedman

I ran into this quote on someone’s blog (actually davidcarlsonpolitics linked it from bart's blog, who linked it from campaignforliberty):

Milton Friedman brilliantly described the four ways that money is spent.

The first and most common way in the private sector is people spending their own money on themselves. In this case, the buyer is interested in both quality (the best product or service that he can afford) and value (getting it at the best price) because he is both the producer of the wealth being spent and the consumer of the good or service being procured.

The second way is when people spend their own money on others (such as gifts). Here they are still concerned about value (it's their money), but less concerned about service quality as they are not the consumer.

The third way is spending other people's money on yourself. Think of the rich man's girlfriend who buys herself the nicest dresses in the store on his credit card without even looking at the tag. She wants quality, but value is irrelevant since she sacrifices nothing.

The fourth way is when people spend other people's money on other people. In this case, the buyer has no rational interest in either value or quality. Government always and necessarily spends money in this fourth way. This guarantees inefficient public spending because the spenders have no vested interest in efficiently allocating those funds.

...and it got me to rediscover Milton Friedman, so I have been listening to this old PBS series:

http://www.ideachannel.tv/

I realize most of you probably don’t have time for the whole thing, but at least check out the clip about the pencil 20:40 into the first episode...

No government program or military action will ever match the power of that pencil. A pencil, created because of the free market, unites the world into cooperating through the beauty of self-interest.

What the . . .

So, will our fine government soon be telling us what health care treatments we can receive and what treatments are disallowed? Is government qualified to be 'judge and jury' when it comes to our healthcare? Will my Mom have to give up her osteoporosis medicine because she is old and the government says she should just deal with the ailments that come with age? Does our fine government realize that it might cost money to keep the elderly on their medications for their various ailments attributed to aging, but it costs far more to put them in nursing centers, which will happen much earlier if the elderly aren’t treated for their ailments?

How much are we willing to concede to ‘save’ an economy and make sure that everyone has their own ‘bathroom’? (That is a play on a woman who spoke at an Obama rally yesterday.)

Are any of our fine Senators and Representatives reading this stimulus bill? If they are, how could anyone vote this through Congress. What the . . . .

Read this article, and you might gain some insight.

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aLzfDxfbwhzs

The Current Economic Recovery

In my last post, I made the mistake of implying my friend Steph leans socialist. As per her comments to my last post, she indeed leans libertarian. Unlike the dogmatic beliefs of the current Left and Right, libertarianism is an intellectual excercise requiring constant questioning of one's core beliefs. Steph is great at tossing me food-for-thought. Today, she sent me something from Newsweek. This article points out that things are probably not as bad as we believe.

When it comes to many things, and especially when it's the economy, the contrarian viewpoint usually holds more truth than what the masses can recognize. This article is optimistic about the future. So am I, but for different reasons. Here are my thoughts about this comment the author made:

"The cry of creeping socialism has likewise echoed (falsely) through the decades. In 1935, the day after Franklin Roosevelt delivered a fireside chat about the need for Social Security and other regulations, a U.S. Chamber of Commerce official accused Roosevelt of trying to "Sovietize America." The medical profession—and Ronald Reagan—swore up and down that the passage of Medicare and Medicaid would transform the United States into an English-speaking version of the U.S.S.R.

Those who fret about an era of slow-growth socialism presume that our government is incapable of learning from mistakes and crafting intelligent policies. The prospect of an enhanced safety net wasn't incompatible with growth in the 1930s and 1960s, and it isn't now. And today, state ownership and control of private enterprise is a temporary last resort, not an enduring governing strategy."

I think government is incapable of helping the economy. We, as Americans, succeed IN SPITE of it, not BECAUSE of it. “State ownership and control of private enterprise” won’t stop the economic recovery, but it unnecessarily delays it.

But, like the author, I am optimistic as well. Only, my optimism comes from the belief that we will overcome whatever obstacles this administration tries to put in the way of our economic recovery.

My biggest concern for the long term health of our economy is our reliance on our false fiat money system and the dangerous Federal Reserve. Those who falsely believe that the unregulated free market has failed us are too ignorant to recognize that we do not, nor have we ever had a “free market”. Our economy is a centrally planned economy based on unsecured currency (not backed by gold) and an unregulated government entity (The Federal Reserve). The free market doesn’t need to be regulated. The government created Federal Reserve does!

The last chapter in Ron Paul’s The Revolution addresses this issue and it scares the crap out of me. BTW- That book is the most important one I have read since Nassim Nicholas Taleb’s The Black Swan. Both books have altered the way I view the world, both politically and philosophically.

Our economy will recover, not because of what has happened in the past, nor because the government is sticking it's dirty little fingers in it, but because of the ingenuity of the great American entrepreneurial mind.

Bailouts Will Not Work

My friend Stephanie sent me this link showing all the wonderful things The New Deal brought us. Now, we have all been taught that we “spent” our way out of the Great Depression via FDR’s New Deal. The bridges and dams are nice, but I think the economic theory behind it is hogwash, yet we have been living “under” it ever since. I believe Keynesian economics is incorrect. Here was my response:

I, for one, count myself as one of the anti-Keynesians and I have never been a Republican. I believe the Great Depression lasted LONGER because of how FDR dealt with it. Keynesians believe the only way to fix a bad economy is to spend more. I, on the other hand, believe that the economy goes in cycles and that it needs to correct itself. And, in fact, government involvement only makes the cycles WORSE!

For instance, the government is trying to keep housing prices from dropping any further by keeping interest rates low. But in reality, the housing market won’t come back until the market decides that housing is fairly priced and individuals are convinced it is time to buy again. Government can’t convince people of that, but by artificially propping up housing prices, they are only PROLONGING the bad housing market.

On a personal level, we instinctively know Keynesian economics is wrong. If your credit cards are over-extended, you know you need to spend LESS, save more, and cut back on wasteful spending. But the Neo-cons (Bush and his clan of idiots) and the Left (that are now in charge) both believe in this Keynesian philosophy because it is the only solution big government can offer. That is why they have pushed this consume-on-credit culture we now have. But since we no longer have any more to spend, they, the government, will spend for us. Of
course, in reality, they are spending OUR money to do it!

Neither side would get elected by telling people to be responsible for themselves, spend less, save more, but that is what I think the real solution is. But since we are now “consumed” out, they feel they get to choose how to consume for us.

I wish Obama the best, but he is destined to fail. Centrally planned economies can build many great things (I am sure Russia is filled with awe-inspiring structures left over from the Soviet years-I would love to see that slide show), but in the end, economies thrive because of individual ingenuity and entrepreneurship, not from some great wisdom handed down by our great messiahs in government....

(Then I continued with a later response...)

I know my libertarianism sometimes borders on anarchism, but I truly believe in the productivity of people more than I do government. I have been listening to Lew Rockwell pretty frequently lately. I subscribed to his podcast on iTunes, but you can get it from his website as well. Today’s podcast pretty much sums up my view of government and it’s role in today’s economy...Government does need to do something. It needs to get out of the way...

http://www.lewrockwell.com/podcast/?p=episode&name=2009-02-08_098_the_left_the_right_and_the_state.mp3

There may be a couple of things the government redistributes our wealth to pay for that I may be okay with, but generally it is inefficient and immoral for government to make those decisions. One, it is not their money. Two, why prop up losers when that only victimizes those who economically have to compete with these scum bags? A $246 million tax break for Hollywood movie producers? A $25 Billion Lifeline for GM, Ford, and Chrysler? Congressional leaders calling for $700 billion to buy distressed mortgages?

If the government didn’t give money to any of these people, there would still be movies, automobiles and houses. More importantly, the sooner we let these poorly run businesses fail, the sooner more efficient entrepreneurs will fill their vacant market segments...But because our government has decided to bailout the losers, these same entrepreneurs have to hang tight until the scum bags pillage through this cash as well...I say again, government is prolonging the pain...

A bridge from LA to Honolulu would be pretty cool, though....

Sorry, I’ll get off my soapbox. ;-)

Have a great Monday...

-dn

Steph’s apt response:

900 billion...gulp...

http://www.phoenixrealestateguy.com/stimulus-bill-putting-900-billion-in-perspective/1877