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Memo to Central Banks: You’re debasing more than our currency

San Diego:  Many times in the past I wrote about what i saw as the unintended but inescapable results of our current federal monetary policies.  But since we have re-elected an administration that has been dedicated to this policy, against all common sense and historical data, I thought maybe it was just me that was out of step. So off I went for some in-depth economic and historical research.

One of my favorite sources of data, as you all know, is Stratfor where I go for some of the best open source intelligence about the world geopolitical and security issues.  But another favorite is John Mauldin’s Outside THe Box blog. What i especially like about his newletters is that he often presents multiple sides of an issue and frequently re-publishes essays, white papers, and newsletters from major players in the world of economics.

In this case he has republished a paper from Dylan Grice of Societe Generale ( a major european bank located in France) bringing an unprecedented historical overview of what has happened in the past.  For you pretenda Keynesians who believe he would support the current actions, he has a long quote from that same economic guru of the liberal progressives that may startle you and hopefully institute something radical… thinking for yourselves.  After all his bank is from one of the leading European Socialist governments around.  But to be successful, socialism, just like any other “ism” requires sound monetary policies to at least keep the elites well fed, in power, and with enough stuff to keep the public trough flowing.

So here is the link.  It is long but the material in it is critical and objective since it did not come from our shores or from someone with a political axe to grind vis-a-vis American politics.

Memo to Central Banks: You’re debasing more than our currency.

The issue for many is whether or not that trend can be reversed.  I don’t think so; i think we have gone too far down this road to reverse it.  Over and over from the late 1990s i said that by the 2016 election would would have cast in stone our path to either recovery of our core foundational precepts or gone over the edge to our ultimate social and culture demise.

Had the election gone other than it did I would ahve withheld judgement to see whether or not Romney could start a course change on this ship of state despite my misgivings as to either his ability or intention of doing so.  But the re-election of a man, in my opinion, dedicated to the destruction of all that remains of that foundational system so he can lead the rebuilding of a new, transformed America along the lines of ther dreams of his father, I think we simply poured an ocean of WD40 on that slope and the likelihood of us escaping it are incredibly slim.

I am aware that many are in favor of the change that he talks about but I think they are terminally naive as to both what he REALLY is doing and where it will take us all.  The link above and the white paper to which it goes provides one likely answer to that.  And it is not one I am happy to see.

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Posted by on November 20, 2012 in Uncategorized

 

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A Good Week for the Prez…The Economy looks Bad.

(DATA ON THE BRISTLECONE PINES PHOTO TRIP IS ONE POST DOWN OR CLICK ON IT IN THE RIGHT HAND “RECENT POSTS” COLUMN)

San Diego — Last week was a GREAT week for the Prez, King Barrack I, all merciful and bountiful, hallowed be his name.  Moody’s is threatening to reduce our national credit rating, and the already under reported unemployment numbers went back up over 9%.  Even party loyalists are quietly uttering the forbidden thought of a “double dip” recession that was long forecast by those doom and gloom folks on the other side.  Ignoring all past rhetoric to the contrary, he told the employees at a Chrysler plant that we had to expect it to get worse before it got better because of “bumps” in the road that would stop even the famous Jeep Wrangler which that plant was building.

Some tried to paper over the remark by claiming it was simply a lame joke.  I don’t think it was a joke at all but a slip of the truth, a “Freudian” error.  It was fascinating he should choose that venue, itself sort of a shell game economically.  The company and the administration made much of the fact that they had paid back their bail out money… they did not mention that they did it with low interest government loans meaning that in terms of their liability to the government it was a wash and they owe the same as they did before the swap in books.

But that is a side show to the economic main attraction.  What I believe are the true bellwether sheep in the mix, gas and food and housing, all continued a negative slide.  Gas went slightly down then back, housing continued down, and food costs continued up while unemployment was up.  All while His Majesty told us how much better things were getting, all while catastrophe was being declared if we were not allowed to borrow even more money instead of facing reality and cutting back on our entitlement spending.

I just have a single question for those advocating this debt ceiling increase.  Would you advise a family member or close friend, someone who was in trouble due to over extending their credit cards, that a workable solution could only be found if they got another credit card and borrowed some more?  How well would you expect that to work out?  Well, that is precisely what the administration is telling us needs to happen.  And they won’t even consider trying to offset that with some spending cuts.

i even just read the comments of one partisan that claimed we were looking at it all wrong and as any banker knows liabilities are actually assets.  He was serious…  and he ignored that it was the banks which had been doing precisely that with a boatload of toxic loans that should never have been granted that was one of the critical nails in the economy’s coffin.

One of the MSNBC pundits, Rachel Maddow, asserted categorically that if we stopped the funding for the wars in Iraq and Afghanistan then we could solve the budget crisis without having to cut other programs.  Whatever she is smoking, i have some old hippie friends that would love to get their hands on some of it. Let’s do the math.

According to the Governments own figures, total defense spending requested for FY 2012 was $881 Billion.  That number included spending on the military, Homeland Security, the Veterans Association, The Nuclear Adminsitration and several State Department Programs.  But to the point, funding for the Iraq and Afghanistan action is requested at $118 Billion, down from $159 Billion last Year.  But the national debt is now over $14 Trillion.  The money for the Iraq and Afghanistan operations won’t even pay the debt service which is $275 Billion for May through October of 2011.  In 2010 interest on our debt was $413.9 Billion and the total for 2011 will be higher.

The other common suggestion from the left is that we should raise taxes on the very wealthy and that would solve it.  OK, let’s do the math again.

According to The  Monthly Treasury Report just put out by the Treasury Department, the total worth of American Billionaires is $1.3 Trillion.  Forget just taxing them, if we took their entire worth and chucked them on the street homeless and penniless we could not even cover this year’s deficit of $1.6 Trillion, never mind the debt. And then who do we hit up for the rest?  And what do we do next year? Throwing in all of the Millionaires entire wealth still does not come even close.

In fact, for those “We can tax our way out of this” crowd, if we added up the entire Federal Tax revenues from all sources (taxes, fees, Social Security, etc.) in 2011 it adds up to $4.46 Trillion.  Does the administration think we are so stupid that we cannot go on to the government’s own web site and get these numbers to poke holes in what they are trying to tell us?  For every dollar in funding commitments we take in less than 50 cents.  Could you run your personal finances like that, unless of course you were on the public dole yourself?  Of course not.

But, you respond, the government can do something you can’t; it can simply print more money.  Yes it can and that is precisely what it is doing.  But how many years of economic study does it take to understand that more money applied to the same number of pulls on it must necessarily result in that money being worth less per unit.  But if you are paid a fixed rate that is not adjusted for inflation, then it takes more of the money from your pocket to buy the same things.  So how is that working out for you at the gas pump and the grocery store?

That is all common knowledge so the answer to the question on the table apparently is, “Yes.”  We ARE that stupid.

There was a time when you might not have heard it since the main media never talked about it and the only ones trying to sound some alarm were those wackos on the opposite side.  But now, even NPR TV finally had one of its reporters admit that some major economists were not backing the administration’s story of economic recovery.  On a Radio Talk show this week even James Carvell, virulent liberal and hardly a pawn in the conservative camp, expressed the concern that Obama, his guy, did not seem to really understand the situation and he feared that we could start seeing some serious civil unrest over it.

So why would this be good news for the Prez?  Well to ask that you would have to be very new to this blog where I have pointed out event after event where, to me, the only logical explanations that connected all of the dots and provided a complete fit to the facts were that either he was rock stupid or was purposely trying to destroy our economy so that he could then ride to the rescue and rebuild it in his own favored European socialist model.  His comment that it has to get worse before it can get better is a revelation of the real plan.  For him to succeed then it MUST get a lot worse… to the point of collapse.

Both the “rock stupid” and the “Socialist Revolutionary” theses form viable working hypotheses. But the missing part of the “stupid” thesis is compassion for the human costs and concern for the country.  Even if he were too stupid, too ignorant, or simply too incompetent to know how to fix it but actually wanted to, a positive desire for the country and real compassion for the economic suffering of so many citizens would have seen an outreach for help and a game change to try to find something that did work even if it was the final humiliation of an admission that the government cannot fix an economy, especially by ramping up the spending policies that created the problems in the first place.  But there is no sign that is about to happen and that means the “stupid” hypothesis starts to fall apart.  That only leaves the one working hypothesis to examine.

Government can certainly can ruin the economy, but only production and private industry can fix it and maintain it.  Increased tax revenues flow from increased productivity.  Duh!  But that concept is not something possible to even contemplate, much less address in his world view.  It is, for him, a complete and willful blind spot.  I think rather that while he is an unqualified and incompetent president, he is not a stupid person.  And he is certainly not without a goal and a plan to reach it.  Instead I think, and with increasing conviction, that he is an ideologue with a plan for social revolution that he is implementing brilliantly.

The obvious next question then is to what possible ends could he be aiming?  Weren’t you listening?  He already told us but no one wanted to hear it and he knew full well that the sycophants hanging on his anointed robes would hear only what they wanted to hear and then try to ignore or spin the rest.  His previous close associates and mentors have already told us.  He himself was clear he wanted to transform America and he was also clear in his vision for what that might look like.  Couched in warm fuzzy rhetoric about caring for the poor, the needy, or, best and most heart-string tugging of all, the children, he wishes to oversee a government run and enforced redistribution of wealth from those who earn it to those who do not.  He knows that those who do not, who seek to continue feeding at the government trough, are a sufficient voting block to keep him in office essentially for life.

Oh I know there is that pesky amendment limiting Presidential terms but he has already shown a major disdain for that musty old document and would have no trouble overriding it as he has other Constitutional roadblocks to his plans.

I can see the eyes rolling now; I hear the whispers that ol’ David has finally lost what little grip on reality he might ever have had.  But I simply would ask you to revisit the history of countries who have gone from some more or less popularly elected for of government (prior to rigged elections that created “Presidents for Life”) and see what the mechanisms were that set the change to a de facto dictatorship in motion.  it has, nearly always and with very, very few exceptions, been the same sequence of effects and it has started with an economic crisis followed by, as Keynes himself described it, a debauching of the currency, that is the printing of more money to stave off an out of control inflation which is then enflamed by the increased amount of money in an economic death spiral.

As in the most famous example, the Weimar Republic in Germany, the value of money declines rapidly meaning the cost of good escalates rapidly until even basics are unaffordable, people panic and in the following chaos take to the streets in protest which, given the nature of mob psychology turns sooner or later to riots and the benevolent dictator in training now has to use strong-arm means for the good of the people to bring things under control.

None of that would be possible here except slowly and surely the drug of benefits has been doled out as if for free and now has become cripplingly addictive.  We were promised “change” and we certainly got it.  From January 2009 to May 2011 Gas prices have increased 84%, Corn has increased 78%, Sugar has increased 164%, Food Stamps have increased 35%, long term unemployed has increased 146%, the national debt has increased 32%.  All of that in a little over half of a Presidential term. The rate of increase in the National Debt is stunning. In the last two years we have accumulated national debt at a rate more than 27 times as fast as during the rest of our entire nation’s history. To put that in some perspective if you are driving in the right lane doing 65 MPH and a car rockets past you in the left lane going 27 times faster, it would be doing well over 7,000 MPH!  Is your income growing at that same rate?

No one could possibly believe that is sustainable and so the only possible explanation for the continuation, much less the acceleration of the policies that created that situation is that it is on purpose and it has as its goal the very end to which it has historically always led: an over throw of government and the institution of a de facto dictatorship “for the good of the people.”

I truly do not want to be correct in this. I keep waiting and searching for the evidence that will provide another working hypothesis to analyze but thus far i’ve not seen it.  That is why i endure the snarky administration apologists on MSNBC and read the claptrap from Huffington Post and other such sites hoping to hear the missing fact or piece of evidence to allow me to change that thinking.  I don’t have any kids so I do not worry about them and I also do not worry about the kids of those who have consistently voted to let this political monstrosity loose on the land.  If that truly reflects the values of the 21st Century American then they deserve what is coming.

What I don’t like is the closing speed which may bring about this collapse and change in my own lifetime.


 
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Posted by on June 7, 2011 in Uncategorized

 

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The Government Wouldn’t Lie to Us… Would They?

San Diego – This might be a long one so get a cup of coffee and setle in a bit…

I’ve been asked,  since I claim only to be an image maker, where I come up with the ideas and conclusions I espouse in this blog and in personal discussions.  How is it that nearly all of my colleagues in the arts and in education, are almost diametrically opposed to me.  It’s a fair question.  I cannot speak for my colleagues and how they arrive at their own conclusions, but in my case I have experience in the real world that most of them lack and I try to follow the advice of my old philosophy instructors in college now summed up nicely by John Mauldin, a major financial figure in this regard when he explained his willingness to quote from those with whom he disagreed by saying,

“… if we only read what we already think, then how can we learn? It is only when your ideas are challenged and you seek (honestly) to determine why the other guy is wrong and you are right, that you can either become more firm in your beliefs or change [as the facts dictate].”

So I try to keep abreast of as many perspectives as possible, assuming hyperbole from each according to their obvious biases, and seek first to find any common ground, which is nearly always correct, or to find the dots that need to be connected whether the piece i am examining has done so or not.  In addition to online versions of the NY Times and Wall Street Journal, I check out the online English versions of La Monde (French), Der Spiegel (German), Daily Mail (England), and even Al Jazeera and Al Arabiya.  I read the political drivel from all sides ranging from NewsMax to Huffington to Politico.  I also devour intelligence reports, especially from Stratfor, financial ideas from John Mauldin’s “Outside the Box” newsletter which as noted above presents ideas all across the spectrum, and, when I am home to do it, try to scan the blather from MSNBC, CNN, and Fox.

Unlike mainstream channels those sources do not seek to hide their biases so you can hear ideas “from the horse’s mouth” so to speak and not hear just an edited version of it.  And finally, my personal library contains many of the foundational documents of the various political philosophies and also the texts driving theocracies such as the Koran/Qur’an or however one choses to Anglicize the spelling.  I have read all of them, sometimes several times.

Of course I cannot read everything out there so I search quickly for articles in the areas that interest me: geopolitics, oil, security and terrorism, and sovereign finances for the most part.  Obviously I cannot do it every day since I have a real job that is, itself, taking more than normal times.  But I can spend a few minutes here and there, cut and paste parts i think are salient into a file and then at my leisure on weekends, such as now, try to make sense of it.

Is it possible I have missed something important?  Of course. But I would argue that whatever else I may be or may not be, I am not completely uninformed as to the events transpiring around us in this most dangerous (in my opinion) of times.

I would dearly love to posit that I think the greatest danger to our country, society, and culture is, as it used to be, an external threat and those certainly do exist in abundance.  But I have come regretfully to the opinion that our greatest threat is internal and that we are, as one financial pundit phrased it, “…trending toward unwitting self-destruction.” Those external dangers, while all very real, poised, and waiting their opportunity, would never have that opportunity if somehow we did not, through internal idiocy or malice, open the gates for them and haul in the modern versions of the Trojan Horse.

You really should re-read (I’m making a possibly invalid assumption about the quality of your education here) the section of the Iliad describing what the Greeks did to entice the Trojans to accept and embrace the vehicle of their own destruction, and then look for the parallels to our current situations.  The only difference is the “Greeks” in this case are not outside the walls, they are already in the walls and in the palace.

Sometimes I feel like Cassandra in this regard.  (Oh, all right, for God’s sake, I’ll just tell you. She was the Trojan oracle who spurned Apollo and was cursed to always tell the truth and never be believed.  She warned Priam and Hector about the Greek trick but was not believed.  No wonder we are such “fair game.”)

So here is my “Cassandra Report.”  Our economic situation is dire and getting worse and if we do not turn this ship around, quit dealing with symptoms and short-term political feel good “solutions” while carefully avoiding addressing the cause of it because the solution is viewed as political suicide and painful in the extreme, we will see our great culture self destruct and open the gates for all of the dangers out there who seek to destroy us and see us join them as just another third world country that is just a bit bigger and see the Orient once again take its place as the major world power.

Whatever horrid pain we will have to face to solve the current problems because we waited too long, are nothing compared to the pain we will all suffer if we do nothing.  And the solution begins by admitting the problem.  You cannot — CANNOT — solve a problem that you will not acknowledge exists.  Period.  And we have a huge problem that in the last few years has been exacerbated to an extreme degree and is now being covered up with a combination of lies, band-aids, and panaceas in the form of misdirections.  We hear each side blaming the other for setting this in motion when the truth is both had their hands in it and there are no innocent parties here.  Good Lord, get over it.  The point, in the end, at least at this desperate point, is NOT who started it… history can sort that out later.  The point is what are we going to do about it and it appears to me our deadly partisanship will prevent this group of so-called law makers from really doing anything.

The problem that the problem is causing is that it is generating such angst that we are losing our ability to keep an eye on the powder kegs in the middle east where the fuse is already lit and inching toward disaster.

(As a teaser, when the current king of Saudi Arabia dies or is killed and if Khamenie is still the high Ayatollah in Iran, keep your heads down because all Hell is likely to break out led by Iran.  Ah but that is a story for another day because it really will not make any difference to us if we are, by then, at a place we are sure to be if we do not reverse course and quickly.)

So what is about to — or at least likely to happen on the economic front?  Well, here is a quote from David Gallard of the Casey Report, a widely read financial newsletter whose conclusions have rarely been wrong:

“The Fed has been extremely supportive of the U.S. government’s insane spending, polluting its own balance sheet by buying up toxic loans by the hundreds of billions and by pumping enormous quantities of cash into the money supply.

” …(you) don’t have to look very hard to understand why we have seen some small recovery in the economy, much of which has been driven by the financial sector that has been the recipient of so much largess – it was bought and paid for by the government, working hand in glove with the Fed.”

Why is this a problem?  Because to support a flawed economic policy, it has resulted in what even Keynes himself feared, a “debauchery” of the currency.  The monetization of the debt by printing money and loaning it to one’s self via purchasing your own bonds, called, euphemistically,  “Quantitative Easing” or QE, is (a) inflationary on the face of it because it debauches (debases) the value of the currency and (b) should it stop after it is depended upon and fundamental problems are not solved, will generate, in, at most (if history remains true) a couple of years, a secondary market collapse because the whole scheme was not used to address the real problems but to prop up the parties complicit with government policy in fomenting the collapse in the first place.

And it appears highly likely that as they approach the end of QE2, the Fed, ever terrified of inflation even through their own filters, will not immediately go to QE3 but will stop to assess the success of the plan.  Success or failure, it will be labeled as a success because it is what King Barrack and Count Bernanke wanted to happen. Given a little time though, the incredible problems impacting our economy will resurface so that the economy will be back in the tank in a way impossible to cover up.

At that time the Fed will be forced to do some further monetization, though they will likely try to pretend it is something else other than more quantitative easing when they describe and label it.  It is all they know to do and have little choice since the politicians at ALL levels are refusing to address the core issues are looking to them to somehow, magically fix it so they (the politicians) can claim innocence of the pain and thereby keep their jobs.  And it appears that the public, on both sides of the aisle, is dumb enough to buy into it so long as they keep being promised protection from their own pain.

I believe however that QE1, 2 or 3 or 4 or 28, by any name or label, are all stop-gap measures that in the end will backfire badly and the inflation feared will come at us like an onrushing freight train and make Japan’s experience look like a Sunday School picnic… unless we change course.  They are treating the symptoms not the cause.  It is like putting a bandaid on a festering wound… it hides the reality for a while until the gangrene sets in to force some really ugly decisions that could have been avoided early on.

So why do I believe that?  I believe it because i believe we are being lied to on so many levels that it is nearly pathological in occurrence.  And that if you look beneath the curtain of this well-woven fabrication all of the signs of disaster are there to be seen clearly.  Here again is David Gallard,

“…the problems that made the economy stumble in 2008 have not been solved. As I said before, most have gotten worse. Have the impossible levels of sovereign debt and trillions in unresolved bad mortgages embedded in the balance sheets of Fannie, Freddie, the Zombie Banks and even the Fed been resolved? Hardly.

“Is there any real sign coming out of Washington that the deficits will be substantively tackled? You don’t have to be as active a skeptic as I to understand that the deepest spending cuts being discussed don’t even scratch the surface of the $1.5 to $2 trillion deficit. As for the $60 trillion or so in debt and unfunded obligations, forget about it.

“The U.S. government and the governments of most large nation-states are fundamentally bankrupt. In time, they will have to default on their obligations. While there will be some overt defaults, I expect most of them to follow the path of least resistance, which is to try to inflate the problem away.”

The truly worrisome deficit is the deficit of government accountability.  Here’s another dot for you to connect.  On February 10th CNNMoney reported the IMF issued a report encouraging replacing the US Dollar as the world’s reserve currency.   China has said, “we don’t want to make any more foreign exchange reserve of any paper currency, because all the paper currencies are government debt currencies.” In southern China, the “BRICS” group, Brazil, Russia, India, China, South Africa, recently met in a sort of mini-summit and agreed “to transact all of their mutual trade and investment in their own currencies” effectively minimizing the need, at least in the short-term, for a global reserve currency and because of, in their view, the volatility of the US Dollar under current fiscal policies.  They didn’t replace the dollar as reserve, they sidestepped it.  But the result is the same.

In a wonderful bit of political misdirection the Administration’s pet sycophantic “economists” have rushed to assure us that the dollar is not in danger of collapsing.  I think they are probably right.  But that is not the issue: it does not have to collapse per se to have a catastrophic effect on our economy.  All it has to do is devalue significantly due to inflation and the spiral is on.  But we are also assured by the anointed one that the economy is back on track and inflation is not a problem.  And if you just slightly cook the books, that is more or less true.  But to do it you have to change the rules of how such things are measured and that is precisely what has just happened.  And Bernanke assured us recently that deflation was not likely.  Duh.  But deflation is not the problem yet everyone read into that, “Hey the Fed said there was no problem so relax; it’s all under control.”  That is the equivalent of the lookout on the Titanic telling everyone, “No problem, we’re made of steel and that is just frozen water so there will be no problem.”

First of all, a “jobless recovery” is NOT a recovery at all.  Unemployment remains very high.  Of course if you are a blind partisan and buy into the government’s figures, it is moving steadily in the right direction. But the government has never entertained any reservations about juggling actual figures to suit itself. One telling statistic they avoid like the plague is, unfortunately, the only real way to look at it: unemployment as a percentage of the employable population, which screens out many of the government’s self-serving adjustments to its official figures. Looked at that way, you can see that unemployment is continuing to rise alarmingly, even though the government is reporting that it’s falling markedly.  What is the basis of their declaration: the number of people applying for unemployment.  Period.

Plans to help solve problems (especially as in California) by raising productivity, which means raising the tax base, are simply pie in the sky when, in fact, the tax base of employees is going down because business — you know, those nasty entities that actually hire people –are being driven to places like Texas.  Anyone willing to do the research to find the real numbers can see that both unemployment and inflation is going up. With the web at hand it is incredibly simple to do the research.  For example, just pull up a chart of the CRB (Commodities Research Bureau) Index for Commodities which tracks the prices for the real stuff required for life – and one can see it has been on a steep upwards trajectory. Inflation is very much here and alive.  As I noted a few posts before, oil is rising rapidly and with it the costs of food production so food cost is also going up.  And so is most everything else.

John Williams’s (another high level financial consultant/analyst) “Shadow Stats” chart (www.shadowstats.com) reveals that inflation is at nearly 10%, while the Bureau of Labor Statistics is reporting 2.1%.  But, and here is a really interesting kink in all of this,  even Williams’ statistics don’t report actual percentages but rather what it would be if the government reported inflation the way it used to, before it started “improving” its reporting in the 1980s. It’s still an incomplete view, because the government’s original reporting was flawed to begin with and skewed to minimizing the numbers even back then.

How can the government skew these figures? Easy, they added in Housing to the CPI (Consumer Price Index). In 2008 housing was dealt a huge blow and it will be there for a very long time, because government had (and continues to) encourage and facilitate bad decisions on the part of both lenders and borrowers. This has left trillions of dollars of bad debt hanging out there, much of it now in the government’s ledger.  So the inclusion of housing prices, which plummeted as that bubble burst, as a component of official CPI, pulls the official inflation figures down, even though those figures don’t sync up with the actual cost of living.  And et viola, a magical and instant drop in inflation numbers.

i once did work for a Fortune 100 company whose CEO made the balance sheets look wonderful by selling off core business departments of the company until there was nothing left to sell.  That company then went under, no longer exists, and to the end the stockholders, told only of the incredible “revenues” while costs dropped, kept voting for HUGE annual bonuses for him.  Hmmmmm, sounds like the government to me…

This is precisely the same approach used to indicate global warming by eliminating, from the list of gathering stations, those that are in colder areas.  And if you leave that little important bit of data out as  you are calculating the figures, they do seem quite plausible.  Ah but now we are bumping into another topic for another time. But is it possible there is a trend here?  Surely not.  Say it isn’t so… and then back that up with some hard data.  Please, go for it.

Many economists from different perspectives are predicting oil prices to continue rising.  Some blame speculators not fully understanding the difference between spot markets and normal market speculation, some blame foreign issues, and others note that in addition to those influences on oil prices, our government seems to actually be facilitating it by refusing to allow us to get at our own reserves or refine what we have in order to push its green agenda onto the backs of people who are trapped in their positions.  With inflation gobbling up large chunks of one’s paycheck, King Barrack’s laughing while telling a worker he needed to trade in his SUV for a hybrid van, is like Marie Antoinette telling the starving French who could not afford bread to “let them eat cake.”

I do hope some of you remember the French Revolution and not only what led up to it but the Reign of Terror that followed.  The next time you ‘neocons’ want to set in motion some protective law please re-read Robespierre’s letter that allowed him to set up the security apparatus that led to job security for Madame Guillotine and see if you recognize any of it.  And you far left people wake up and see the revolution that is possible when you get the people mad enough because they are feeling helpless because that is where you want them to be to justify your creation of the government village to take care of them.

People underwater with their homes and vehicles could not trade up to a hybrid vehicle even if they wanted to.   What a stupid, irresponsible response that was but it is totally revealing of the agenda and of the connection King Barrack has with real people. Telling the people here in southern California to use public transportation where a 20 minute commute by car would then take 2-3 hours — assuming it was even an option — is ridiculous and out of touch. But then so are the proponents of such ideas.

Before you can demand that change you have to build a workable system and that takes… oh wait, I’m beginning to see it now… that takes higher taxes to pay for it.

Why no, they wouldn’t lie to us… much…
.

 
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Posted by on April 16, 2011 in Uncategorized

 

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Tough Times

San Diego – Things are getting really grim for education in this state and especially for the Community Colleges.  Under the best case scenario we will lose at least 200 course sections at City College by next Fall Semester.  And it could double that number if the State continues to place more emphasis on protecting prison guards and prisoners, prohibiting drilling and refining, and making sure the snail darter and delta smelt are accorded more attention and sympathy than it provides for educating its next generation.  Never mind that without the education that a college offers, individuals will only get lower paid jobs and the tax base to pay for all of those entitled victims feeding at the public trough will get smaller and smaller, or that as taxes rise the employers themselves will continue, as they have already started, to leave for better business environments and with them more contributors to that tax base will evaporate.

Of course that scenario is mirrored by the Federal government as well which seems determined to spend more, not less, and to adopt as a solution to cash needs the expedient of printing money and loaning it to itself using the wonderful euphemism of “Quantitative Easing” or QE.  Is there no one that reads history?  Are the sycophants of King Barrack or Count Bernacke so willfully blind they refuse to even consider the obvious.  They are all in thrall to the liberal economic theory of John Maynard Keynes but they are so without having actually READ Keynes’s work.  And if they did, they quickly turned the page when he wrote, “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency.”  As Milton Friedman noted, only a government can take expensive paper and very good ink and turn the combination into something worthless.

The really scary thing is that maybe they DO know.  Perhaps they are all as smart as claimed and this is not slipping by them, it is being done on purpose.  How did Keynes phrase it? “…overturning the existing basis of society.”  Does that sound like “transforming” society to you?  Before you can transform or overturn a society, unless you are already starting with a generally illiterate populace or one used to autocracies, you have to seriously dumb it down and make it dependent on the authority to keep the food trough filled.   Hmmmmmm.  And what better way of doing that than to start the devaluation of both the currency and the educational system?

A growing cadre of financial advisors and economists are trying to sound the alarm bell that we are heading toward catastrophic inflation but are ignored by the mainstream press.  The government denies it absolutely and tells us instead, in a wonderful example of a magician’s trick, that we are in lessening danger of DEflation.  But gas at the pump has doubled in the past two years.  The increasing fuel costs have increased food costs (it takes fuel for farm implements, transportation, power to stores, and GETTING to the stores) to, in some cases, nearly 50% in that same period.  People may do little more than complain about gas but when they start cutting back on food it will get their undivided attention.  If we, as a society, sheepishly accept that and then accept the sure-to-follow offer of the government to step in and provide for us, then it is hard to see how something could be more transformative from a self reliant people to a dependent people.  it will be a redistribution of wealth all right, redistributed from he people who earned it to the government so they can pay down the debt and get their credit back.

Machiavelli would be proud of King Barrack if he pulls that one off.  Political “good” is achieved when an environment is created that allows citizens to be self reliant and self sufficient and enjoy the fruits of their own labor.  Political “Evil” is achieved when the citizens are made dependent upon the government or “village” to survive.  And what would we call such a system?

Using labels to demonize philosophical opponents is a scurrilous, but effective trick because it halts debate and clouds issues behind an emotional smokescreen, so I am not going to assert that our progressive thinkers are one thing or another.  I would assert however that their ideas and ideals are more closely aligned with those of William Godwin than of John Locke, more clearly flowing from Jean Jaques Rousseau than from Edmund Burke, far more consistent with the thinking of Karl Marx than of Thomas Jefferson, and would garner greater enthusiasm from Gus Hall than from John Kennedy.  And in that is a message that is both critically important and generally ignored.

The silence is deafening and i can see “deer-in-the-headlights” stares aimed at me.  What?  “Who are those people?” you ask.   If you do not know and do not know what they all stood for then I would suggest you have no business taking part in the political discourse and debate because without knowing how we got to where we are you can have no idea where it is going.  It is like mathematically trying to draw a trend line based on a single data point.  If you want to know the truth about someone’s foundational beliefs and where they are likely to lead, then you must understand the foundations of those beliefs.  And if you will do that, and God knows the web can make it far easier for you than it was in the old days of actually having to have or go to a library and, gasp, READ something, then you may be somewhat unsettled by the information and find yourself needing to rethink things a bit.  In doing so you will start, finally, to become one of those “informed citizens” Jefferson said was essential to the success of democracy.  Perhaps you will read and understand the fear the founders had when Madison, and Jefferson, philosophical opponents in may ways, agreed that the greatest danger would come when the people realized that they could, directly or indirectly, write themselves a check from the public treasury.

We are there now.  The danger is bleak and at the gates.  The only question of value at this point is are you going to man the walls to fight it off or run down and open the gates?  Or does it matter?  Have we in fact, as some economists are saying, passed the tipping point from where recovery without tumult is no longer possible?   If so it will be because too many people sat on their hands and researched no more deeply than the talking points of their chosen party, steeped themselves in the profound philosophies of bumper stickers, and blindly followed those choir masters of the chosen choir.  If this culture and country craters around our ears then those blind followers are the people to blame.

Perhaps it will be too late for California’s education system to recover and it, along with the State’s economy, will need to collapse and wait to be rebuilt until the wreckage of its current policies is utterly inescapable to anyone willing to look.  Perhaps it will be the same for the State’s economy and, for that matter, the Country.  I hope not but I must confess I am no longer optimistic.


 
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Posted by on March 31, 2011 in Uncategorized

 

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