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Tuesday, August 31, 2010

Rogers: "Stop Printing Money"

These reporters seem stunned to hear Roger's message which is, in essence, that central bankers can not fix the economy by printing more money. I also enjoy the false alternative proposed to Rogers between so-called "austerity" and "pumping in more money." Evidently, if the government stops spending other people's money on absurd projects this would qualify as "austerity." Instead, I would refer to it as "government stops pissing our money down a toilet - ity." The way out is for government to slash spending, cut taxes, and discover individual rights and free market economics.

Saturday, August 28, 2010

Obama and Biden's "Fun Stuff"

My four year old son came to me recently and showed me a picture of a toy he wanted. Attempting to be a responsible dad, I explained that it cost money, but he could try and earn it by doing some work around the house. He was thrilled to hear this. After sweeping every room at full speed, he ran to his mom and demanded his pay - one fresh dollar bill. Proudly, he showed me his spoils. "Now can I buy the toy?" he asked. "Well," I explained, "this toy costs more than a dollar. It probably costs at least ten dollars." Immediately, he walked into the other room. "Mom, can I have a ten instead of a one?"

After laughing and trying to explain that he needed to do the job about ten more times, I pretty much gave up. He'll get it, some day. Unfortunately, his economic understanding of the world is probably now more advanced than anyone in the Obama administration, including panels of professors and Nobel Prize winning economists. They only thing that separates them is something my son would envy, a legal printing press known as the Federal Reserve.

In a series of previous posts, I have endeavored to debunk so-called stimulus spending which is the absurd idea that the government should spend other people's money and that this spending somehow will lead to economic prosperity. In short, I argued that a dollar spent by the government is a dollar that will not be spent by someone else. The government is not a productive enterprise. It obtains funds through taxation, borrowing, or indirectly through the inflation of the money supply and simply redistributes these funds to others. "Stimulus" spending is at best a zero sum game and, in fact, profoundly destructive as it distorts capital markets and replaces productive spending, such as saving and investment, with consumption. Of course, consumer spending is its purpose, because in the Bizzaro World of Keynesian economics, saving is regarded as destructive.

A recent Time magazine article titled "How Stimulus is Changing America" attempts to give us some perspective on the massive stimulus spending undertaken by the Obama administration. The author explains that the program was originally predicated on Keynesian New Deal policies:

After Obama's election, Depression scholar Christina Romer delivered a freak-out briefing to his transition team, warning that to avoid a 1930s-style collapse, Washington needed to pump at least $800 billion into the frozen economy — and fast. "We were in a tailspin," recalls Romer, who is about to step down as chair of Obama's Council of Economic Advisers. "I was completely sympathetic to the idea that we shouldn't just dig ditches and fill them in. But saving the economy had to be paramount." ...They wanted a textbook Keynesian response to an economy in cardiac arrest: adding money to existing programs via existing formulas or handing it to governors, seniors and first-time home buyers. They weren't keen to reinvent the wheel.

The author does not address the efficacy of this plan in terms of economic growth because it has obviously failed (as a plan akin to digging ditches and filling them just might). Instead, he explores the actual goal of the stimulus: changing the composition of spending, i.e., diverting capital from productive uses to spending on idiotic government programs, a.k.a., "Obama's agenda":

[T]he battle over the Recovery Act's short-term rescue has obscured its more enduring mission: a long-term push to change the country. It was about jobs, sure, but also about fighting oil addiction and global warming, transforming health care and education, and building a competitive 21st century economy. Some Republicans have called it an under-the-radar scramble to advance Obama's agenda — and they've got a point.

Note that the author regards this agenda to be a prima facie value. Why? He doesn't say. What he is implying is that although the headline purpose of this kind of stimulus spending is growing the real economy, the actual goal is to change the nature of economic activity, i.e., change how your money is invested such that it is invested in projects the left deems to be unquestionable values.

[I]n the words of Vice President Joe Biden, Obama's effusive Recovery Act point man, "Now the fun stuff starts!" The "fun stuff," about one-sixth of the total cost, is an all-out effort to exploit the crisis to make green energy, green building and green transportation real; launch green manufacturing industries; computerize a pen-and paper health system; promote data-driven school reforms; and ramp up the research of the future. "This is a chance to do something big, man!" Biden said...

Note the premise here. Evidently, only government central planners really know how best to deploy capital. What would America's entrepreneurs do with $800 Billion? What could Apple, Microsoft, Pfizer, GE, Exxon, HP, Dell, 3M, Intel, etc. do with $800 Billion? We will never know. Instead, it will be allocated to "fun stuff" like "date driven school reforms", "green building", and the ever popular "research of the future." Why is this important? What are the alternatives? Who cares - this sounds good to Biden, and it is something big, man! The article explains how the great innovators of our age, Joe Biden and Obama, formulated their vision:

Obama and Biden also saw a golden opportunity to address priorities; they emphasized shovel-worthy as well as shovel-ready. Biden recalls brainstorming with Obama about an all-in push for a smarter electrical grid that would reduce blackouts, promote renewables and give families more control over their energy diet: "We said, 'God, wouldn't it be wonderful? Why don't we invest $100 billion? Let's just go build it!' "

Yeah, how about $100 billion?! Why not more? How about $800 Billion? Where does the money come from? Taxes? No, not possible. We'll borrow it. But, that will raise rates. Then print it. Turn one into ten...

Put aside the rampant fraud, absurd programs, and the unintended consequences for a moment. Note that under this brand of statism, it is upon just these kinds of whims that your hard earned money is spent. Investors, corporate executives, engineers, and consumers whose lives and fortunes depend on researching and developing sectors of the economy are disregarded. Small businessmen who pour their life and soul into their fledgling companies and toil to make a living are dismissed while their savings are taxed to pay for this debacle. Professional investors, whose livelihoods rest on their ability to deploy capital to its most productive use, are harassed and throttled. Yet, Joe Biden and Obama "brainstorm" over a few cocktails and decide a "smarter electrical grid" mandates the immediate theft of $100 billion from America's savings and Voila! Such delusions are the essence of the central planning mindset - the Philosopher King who knows what is best for you, your neighbor, an industry, the world. These law school angels from heaven who know how to organize an entire economy better than the sum total of businessmen, scientists, and consumers.

This point is critical to understand the liberal mindset. Often, people are shocked by Obama's seeming defiance of economic common sense. Virtually every day I will hear, "why would Obama do that? It doesn't make sense." Of course, they are presuming that Obama's vision of a "good economy" is their own, i.e., a free and thriving economy based on innovation, productivity, and wealth creation - an economy that produces unlimited opportunities and brings to life wonderful new products and services. That is not Obama's vision. His "vision" of a good economy appears to be one of a land littered with state sponsored communes energized by solar powered arrays, leviathan public hospitals operating off of digitized health records, and homes containing "smart-meters" wrapped in space age caulk.

Once, the socialists told us they could scientifically plan production and outproduce the chaos of capitalism. When that failed and socialism led to poverty and misery, they now tell us that capitalism produces too much and we have to go back to living like cavemen. While the left's concrete values change from one generation to the next, the one constant is the desire for power - power over the lives of others; the power to tax, regulate, and mandate every waking moment of an individual's life; to impose the most recent version of their lofty vision on the unwashed masses. Whether it is Mao's Great Leap Forward, Stalin's forced collectivization, Hitler's master race, or less murderous plans like FDR's New Deal, Johnson's Great Society, or Obama's stimulus, the left always has a Plan for you.

My son will work ten jobs to make the money for one toy. Don't count on Obama and Biden to work off $800 billion.

Tuesday, August 24, 2010

Why Ron Paul is Wrong on Mosque

Ron Paul wrote this editorial related to the NYC mosque in which he essentially accuses those who oppose the mosque to be guilty of "demagoguery" and "Islamaphobia" arguing that the demonization of Islam is all part of an effort to justify unconstitutional and unnecessary wars in the Middle East. Paul states:

There is no doubt that a small portion of radical, angry Islamists do want to kill us but the question remains, what exactly motivates this hatred?

If Islam is further discredited by making the building of the mosque the issue, then the false justification for our wars in the Middle East will continue to be acceptable.

The justification to ban the mosque is no more rational than banning a soccer field in the same place because all the suicide bombers loved to play soccer.[emphasis mine]

Furthermore, he takes conservatives to task for allegedly not recognizing the important First Amendment implications:

The debate should have provided the conservative defenders of property rights with a perfect example of how the right to own property also protects the 1st Amendment rights of assembly and religion by supporting the building of the mosque.
While I agree that the self-sacrificial neo-conservative effort to "nation build" in the Middle East is completely wrong, particularly the war in Iraq, I hold that Paul's more fundamental argument related to Islam as a religion is flawed and further, I believe this issue points to the crucial need for thinking in principle underscoring the important difference between libertarianism and a systematic philosophical defense of individual rights.

In my previous two posts, Is Islam a Religion? Part I and Part II, I attempted to refute the essence of the argument implied by Paul. In summary, I argued that since Islam urges its supporters to commit acts of violence and indeed has become a violent political and military force that has declared war on the West, it should not be construed as a "religion" in the Constitutional sense, i.e., a body of abstract ideas. In the context of war, those who sympathize or aid and abet the enemy commit an act of violence just as someone who urges another to beat or kill someone commits an act of violence even if he is not the one actually giving the beating. Such a state is analogous to how we should have treated Nazi's during World War II if they were to organize or recruit in the United States. All Muslims are not evil murderers just as all Nazi's and all Communists were not evil murderers, however, in the context of war, this kind of allegiance should be grounds for legal scrutiny based on the objective establishment of a group, nation, or networks' actions and professed intentions.

While one could debate the particulars related to the legal and practical application of the above principles, it is clear that this is the debate that should be taking place. For Paul to argue that Islam is only incidental to the 9/11 terrorist attacks or any of the various terrorist attacks against Western targets over the years or as incidental as their preference for "soccer," is a massive evasion. It is on exactly such grounds that anti "profilers" tells us that 90 year old grandma's are just as likely to be terrorists as young Muslim males leaving a madrassa run by the Taliban.

But why does Paul make such an error? Fundamentally, I believe it has to do with not grounding the concept of liberty in a more fundamental philosophic framework. To the libertarian politician, "liberty" is the fundamental concept by which all policy applications are evaluated. However, without a more fundamental basis, this concept becomes an out of context abstraction and it can not be properly applied except in the most trivial circumstances.

For example, objectively identifying threats and understanding what constitutes an act of coercion is essential to actual liberty, that is, the proper application of the principle of individual rights. If someone is walking around with a bomb and a bag of cash from the Iranian government, chanting "Death to America", could Paul not bring himself to usurp this man's "liberty" until he actually explodes the bomb? At what point should an organization be considered a criminal organization? At what point should another country be considered an objective threat? At what point should we declare war? Do they have to be in Manhattan harbor shooting at us before we take action? Of course, this is not a simple question and does involve a lot of legal philosophy, context, and evidence, but it should at least be clear that we should be debating these kinds of legal standards.

For Paul to simply dismiss these issues as "demagoguery" or a form of racism is not only wrong - it is suicidal.

Friday, August 20, 2010

Is Islam a Religion? Part II

Following up on Part I, I would like to suggest a few additional principles related to the NYC mosque situation. As I suggested in Part I, I think there are two conditions to consider in regard to identifying an objective threat. First, the ideology by its nature must be antithetical to the principles of individual rights and a constitutional republican form of government. Second, the ideology must be actively engaged in attempting to subvert or overthrow our government, i.e., advocating for or actually engaged in the use of force.
What is relevant is whether a body of thought or set of doctrines espoused by some organization can exist within a broad legal framework founded upon rational definitions of individual rights such as free speech, freedom of the press, property rights, due process, etc. Whether or not a certain ideology takes issue with applications of these principles is not important. However, if an ideology by its nature opposes the very foundation of this framework AND actively seeks to undermine this system through violent means, i.e., the initiation of physical force, such an ideology moves from the status of "religion" or "ideology" to an active enemy of

Shinto is an ancient Japanese religion and did not present a threat to the United States until it received state sponsorship and became part of a nationalist movement which sought global domination and attacked the United States in 1941. Communism actually began as a religious movement in the centuries before Marx secularized it in the 19th century. Even then, it was still not a "threat" until it too received state sponsorship and it's followers made their goal military conquest and global domination. Once an ideology receives state or some form of organized sponsorship and actively seeks to overthrow western governments, it becomes a criminal enterprise. Any offshoot, whether it is actually sympathetic or not to the more radical leadership, is then fair game to be investigated by our government and sympathizers arrested or deported.

Certainly, during World War II, any organization sympathetic to the goals of the Japanese Empire or the Nazi's would have rightly been shut down or arrested by the U.S. government and treated as enemy combatants depending on the extent of their activities. Communism was merely a kooky philosophy until the Bolshevik revolution of 1917 followed by other movements which swept Europe and Asia, i.e., it was not a threat until it found state sponsorship and attained the goal of global domination, threatened our interests, or engaged in either outright or proxy wars with the United States. At that point, communist organizations which espoused this ideology ceased to be protected under the First Amendment, and became an objective threat to the existence of our government.

Many have said that the fact that there is not an obvious state sponsor of Islam and the fact that it seems to have many degrees of radicalism makes it more difficult to identify whom we are to fight.

First, once the proper principles are identified, the task becomes much easier. One needs to ascertain the state sponsors in terms of organization, finances, and training starting with the most radical first. Once these sponsors are crushed, the various offshoots become marginal, just as some random sympathetic Communist, Nazi, or Shinto organizations were neutered once the Soviet Union, Nazi Germany, and the Japanese Empire fell. Until the time at which state sponsorship and a global threat is neutralized, anyone identifying themselves with Islam must be regarded with suspicion and there should be an objective legal framework for investigating any ties to more violent organizations as we did with Communists in the 1950's or the Japanese and Nazi's during World War II or British loyalists during the American Revolution. I would make the same argument against Catholics if the Vatican declared its goal to be world domination under the rule of the Pope and Vatican law and were to actively fund and train an army in this effort.

Second, I think the primary state sponsors of totalitarian Islam are obvious. Iran is the heart and soul of this movement followed by Saudi Arabia and Syria. Rather than focus on rogue tribes hiding in the mountains of Afghanistan, we should be confronting the elephant in the room - Iran and its countless financial and military allies which fund, train, and support radical Islamic groups throughout the world. While this occurs, Islamic organizations in the United States should not be treated as a protected "religion," but as sympathizers to America's enemies and since they identify with our legal and objective enemy, the burden of proof must be on them to show that they are not sympathetic or do not in any way directly aid and abet these global sponsors.

Third, because the freedom to speak and practice religion are sacred pillars of the American system, it is vital to objectively define and delimit the government's function as it relates to defense, i.e., define precisely when it is necessary for the state to use force in the protection and furtherance of individual rights. I have no illusion that the current American regime has any ability to fulfill this obligation, and I understand those who are concerned that such powers could be used as a precedent to persecute any political opponent of the state arbitrarily deemed to be "dangerous." I suggest the above as a blueprint precisely because the situation calls for a strictly objective formulation in order to delimit this use of force.

Thursday, August 19, 2010

Is Islam a Religion?

Generally, two sides have formed around the NYC mosque issue. One side says it is immoral or wrong to build a mosque so close to the 9/11 site, however, they have a legal right to do so. Another side says that it should be prevented legally, that is, the government should actively move to shut it down. I will not consider the side that actually promotes its existence. Since this argument has been beat to death in many corners of the Internet and elsewhere, I will not attempt to characterize the debate or offer new concretes. My goal is to answer a broader question related to this issue.

If the Emperor of Japan or Adolph Hitler had attempted to set up a recruitment office in the center of New York during World War II, the U.S. government would have had every right to shut it down. Whether they were motivated by Shinto or Nazism would not have made a difference, i.e., one could not have argued that the government were stifling a particular ideology since these persons were actively engaged in a physical war with America. I doubt many would argue with this presumption.

So, at what point does a "religion" or any doctrine move beyond a mere body of abstract thought, deserving protection under the First Amendment, into a philosophical or legal area wherein a proper government has objective moral and legal grounds to prevent followers from pursuing recruitment, dissemination, assembly or political organization? To me, this is the essential question underlying the New York mosque issue. In this context, the question is whether Islam is a "religion" in the sense that it is meant within the Constitution or more broadly construed under the principle of individual rights or whether it should be considered a "political movement" that is actively at war with America and/or the broader legal and cultural framework known as western civilization?

Philosophically, faith is the acceptance of an idea in the absence of evidence and is the characteristic which distinguishes religion from science. I do not believe that the concept of "faith" is relevant in a legal context, i.e., the essential epistemological foundation for a view point is not relevant. What is relevant is whether a body of thought or set of doctrines espoused by some organization can exist within a broad legal framework founded upon rational definitions of individual rights such as free speech, freedom of the press, property rights, due process, etc. Whether or not a certain ideology takes issue with applications of these principles is not important. However, if an ideology by its nature opposes the very foundation of this framework AND actively seeks to undermine this system through violent means, i.e., the initiation of physical force, such an ideology moves from the status of "religion" or "ideology" to an active enemy of civilization. Whether or not the state has formally declared war on such an ideology is not important as many instances of this type of organization could exist or spring up.

With respect to the particular mosque issue, I believe that Islam should be considered an active enemy of civilization. Although I am not an expert on Islam, from what I understand, there is very little separation between its doctrines and their manifestation in the political life of its adherents. It's followers advocate Sharia law which is a set of legal traditions that stand in complete and total opposition to western precepts of individual rights. Husbands can beat and rape their wives. Stonings and hangings are common to those who speak out against the religion or convert to another (apostasy). It is intolerant and hostile to non-believers in the most vile, racist, and violent ways imaginable. Its goal is the complete enslavement of mankind under a global caliphate, i.e., global theocracy, and it has killed tens of thousands in this effort.

Rather than be seen as a "religion of peace" with a few extremists tarnishing its essence, it should be seen as a global political and military force that seeks to spread throughout the world. If this movement were contained to other nations, I would argue as a matter of foreign policy that we have no interest in opposing it militarily. However, as this movement has repeatedly attacked western interests and made its motivations and goals crystal clear to anyone who will listen, the U.S. government should officially regard Islam as our ideological enemy and take any steps towards thwarting its spread within our borders and by supporting allied efforts to do the same.

Also, to answer the argument that only some Muslims are "extremist" I would say the following: just as every Nazi was not a Hitler or Goebbels, and not every Japanese citizen was a kamikaze during World War II, this is not relevant. What is relevant is the actions of its most consistent advocates and its leadership alongside the inaction of its so-called silent majority. It is up to them to rise up and moderate or reform their "religion" in such a way that it can co-exist with the West while broadly respecting the basic principles of individual rights. If, by its very nature, it can not exist in this way, then we should not respect the rights of its followers as they do not respect ours.

Wednesday, August 18, 2010

"The Beatings Will Continue Until Morale Improves"

The title of this post is how a colleague summarized Peter Schiff's editorial on recent Fed actions. Schiff states:

Just a few weeks ago, pundits were asking how Ben Bernanke would shrink the Fed's bloated post-crisis balance sheet. But in its August 10th decision, the Fed signaled that it would "recycle" its debt holdings; in other words, there would be no exit strategy for the foreseeable future. Given the fact that monetary stimulus will not only fail to spark a genuine recovery, but create a never-ending need for successively larger doses, Bernanke should grab a few beers and head for the nearest available emergency slide.
Schiff points out the contradictory premises inherent in the Fed's approach - it promises to "remove" the stimulus when the economy recovers, however, the economy is being propped up by easy money, i.e., the economy can not recover until the Fed removes the stimulus! Schiff states:

Bernanke and his supporters have said that their stimulus will be withdrawn as soon as the recovery takes hold in earnest. This misses the point that any "growth" created by stimulus is totally dependent on stimulus to continue. The "recovery" will end as soon as the stimulus prop is removed.
Bernanke's economic philosophy insures that the Fed will continue to find more and more clever ways to create money through quantitative easing. Just as an addict needs more and more drugs to get high, a highly leveraged economy needs more and more "stimulus" to stop the natural forces of deleveraging and price and wage decreases from occurring, forces which would create some short term pain but would restore a solid economic foundation upon which to rebuild. Schiff states:

Like their patrons in the White House and on Capitol Hill, the Fed is totally dedicated to postponing the short-term consequences that would result from breaking America’s addiction to cheap money and easy credit. Compared to this imperative, the long-term economic health of the country barely gets a second thought.
He rightly concludes:

Unfortunately, no one at the Fed has the honesty and courage to suffer the short-term shock that would accompany any meaningful exit strategy. Withdrawing liquidity and shrinking the Fed's bloated balance sheet would no doubt bring on a severe contraction in GDP, but the moves would also enable the US economy to form a solid foundation of savings, capital investment, and industrial production upon which a real recovery could be built. By contrast, more stimulus simply magnifies the imbalances, including excessive government spending, too much consumption, inadequate production, and artificially elevated asset prices. After decades of abuse, it's time for the Fed to make a dramatic exit, because the US economy can't take it anymore.
For more logical economic thinking, see this excellent interview with Kyle Bass of Hayman Capital. The blog author states some of the themes touched upon in this interview:

...the inevitable restructuring of untenable sovereign debt, the nearly $5 trillion in new global debt that needs to be issued just to plug near-term deficits, the joke that was the European stress test and the ongoing insolvency of the European banking system which is times bigger than its US equivalent, the imminent downward revision of Q2 GDP to sub 1%, the Fed's conflicted position as a political authority whose sole purpose now is not to keep inflation and unemployment low, but merely to keep interest rates as low as possible, as even the slightest shift to higher short-end rates will be seen as a black swan, indicative the Fed is losing control over the economy, and ultimately the futility of Keynesian theory band-aiding of a world caught in a toxic debt death spiral. In short, Bass sees no way the world can get out of its current state absent a huge reset.
Related to Japan and the massive amount of outstanding government debt (one quadrillion Yen!), Bass makes the excellent point that a Ponzi scheme can last as long as there are more new buyers than sellers in the scheme, which in the case of Madoff lasted a very long time. For a government which sells bonds to its own citizens as Japan largely does, the end of this scheme comes when the "costs of servicing the debt exceed revenue." He makes the pragmatic point that Japan's demographics are at a stage where they are entering a kind of tipping point as their savings rate declines and they begin to go outside for funding.

One topic not on many radar screens is state budget deficits. Here is a
great article that lays out the startling numbers related to state budget shortfalls. Related to these facts, I will make a prediction: As state budget shortfalls become a larger headline, and with congressional stimulus off the table, look for the Fed to announce it will buy municipal bonds from states. I have not heard this mentioned at all recently, but it would seem logical they would go this way given their premises and the political fact that most people do not understand the effects of the Fed's machinations. As I claimed a while back, such an approach would be a back door way for state's to print money. State's have always been forced into some kind of discipline since they do not have the printing press as the Federal government does. Such an approach would remove this check on state spending power since the Fed could create money by which it would use to purchase state bonds. Effectively, such an approach would place an inflationary tax on all holders of dollars as a means to bail out profligate states such as California, Illinois, and New York.

If you want to contrast logical economic thinking with Keynesian economic doctrines, i.e., the very thinking that has gotten us into this mess, consider this piece by the very influential Paul McCulley of Pimco, the largest institutional fixed income money manager. Rather than understanding that recession is recovery and that price and wage decreases prevent deflation from occurring - an issue I discussed in detail here and here- McCulley makes the usual mistake of conflating price decreases with deflation and urges the Fed to print money saying:
the central bank has a profound duty to act unconventionally, ballooning its balance sheet by monetizing assets, either government or private, or both.

The central bank has a profound duty to meld itself with the fiscal authority, until the fat risk of deflation is eliminated.
Let's see - painful short term medicine in exchange for a long term recovery or a green light to print money as fast as possible - which option will "Helicopter Ben" choose?

Monday, August 9, 2010

Dear Hawking, I Know What You Read Last Summer...

According to world renowned theoretical physicist Stephen Hawking, "it's time to free ourselves from Mother Earth."
"I believe that the long-term future of the human race must be in space," Hawking tells Big Think. "It will be difficult enough to avoid disaster on planet Earth in the next hundred years, let alone the next thousand, or million. The human race shouldn't have all its eggs in one basket, or on one planet. Let's hope we can avoid dropping the basket until we have spread the load."
"But why?" you ask. The article summarizes:
Let's face it: The planet is heating up, Earth's population is expanding at an exponential rate, and the the natural resources vital to our survival are running out faster than we can replace them with sustainable alternatives. Even if the human race manages not to push itself to the brink of nuclear extinction, it is still a foregone conclusion that our aging sun will expand and swallow the Earth in roughly 7.6 billion years.
If you think that represents visionary thinking (after all, the interview is in Big Think), you may want to reconsider. A parent writes about a rather hilarious experience borrowing a book from the local library for her child whose curiosity about space had recently been peaked. It turns out the 1985 book, Space Colonies, has some rather cute theories to interest little Johnny. Quoting the post:
But the next chapter is where they drop the bomb. Why Build Colonies in Space asks the chapter title? Because our planet is headed for IMMINENT RUIN. We will soon have so many people that there won't be enough room for everyone. Naturally, the most practical solution is to encourage some people to LIVE IN SPACE. The book does not detail what kind of incentives would be offered to those willing to leave. Lower taxes, maybe? It also does not mention that even if a space colony big enough to house the entire population of Rhode Island (1,053,209) could be constructed, it would only remove 0.01% of the population from the earth. How many people live in the International Space Station? Like eight?

The second part of the chapter is more contemporary and discusses our limited natural energy resources. I can get behind that, but instead of arguing for the development of renewable energy the book suggests we MINE THINGS ON OTHER PLANETS. It then correctly points out that there is endless solar energy available in space. Because constructing a solar power plant and housing it's hundreds of employees IN SPACE is clearly a better first step than attempting the same on our planet.
See the post for the book's prediction of which year the space colonies will be built and also for the content of a chapter titled "Hope for the Future", which the author dubs "The Most Ironically Named Chapter of All Time."

C'mon Stephen, they knew about this in 1985. In fact, many others have known about this for some time.

Friday, August 6, 2010

The Death of Global Warming...for Dummies

Remember the good ol' days when I used to post about the Global Warming fraud on a regular basis? Well, I guess the fact that Al Gore is in the news for, uh, other reasons underscores the theme of this post. Here is a Forbes article titled, The Death of Global Warming, and here is a great synopsis of the science by Dr. Roy Spencer titled, My Global Warming Skepticism, for Dummies. And, in case you are keeping track, here is some skepticism on the recent "independent review" of the Climategate controversy conducted by approximately the same people who were accused of the coverup.

Thursday, August 5, 2010

August Surprise?

James Pethokoukis reports:
Main Street may be about to get its own gigantic bailout. Rumors are running wild from Washington to Wall Street that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth. An estimated 15 million U.S. mortgages – one in five – are underwater with negative equity of some $800 billion. Recall that on Christmas Eve 2009, the Treasury Department waived a $400 billion limit on financial assistance to Fannie and Freddie, pledging unlimited help. The actual vehicle for the bailout could be the Bush-era Home Affordable Refinance Program, or HARP, a sister program to Obama’s loan modification effort. HARP was just extended through June 30, 2011.
He adds:
What is happening is that the president’s approval ratings are continuing to erode, as are Democratic election polls. Democrats are in real danger of losing the House and almost losing the Senate. The mortgage Hail Mary would be a last-gasp effort to prevent this from happening and to save the Obama agenda. The political calculation is that the number of grateful Americans would be greater than those offended that they — and their children and their grandchildren — would be paying for someone else’s mortgage woes.

Wednesday, August 4, 2010

Your New Health Care System

Here is a detailed chart put out by Rep. Kevin Brady and Sen. Sam Brownback. Brady's press release states:
Four months after U.S. House Speaker Nancy Pelosi famously declared "We have to pass the bill so you can find out what’s in it,"a congressional panel has released the first chart illustrating the 2,801 page health care law President Obama signed into law in March.
He adds:

In addition to capturing the massive expansion of government and the overwhelming complexity of new regulations and taxes, the chart portrays:

$569 billion in higher taxes;

$529 billion in cuts to Medicare;

swelling of the ranks of Medicaid by 16 million;

17 major insurance mandates; and the creation of two new bureaucracies with powers to impose future rationing: the Patient-Centered Outcomes Research Institute and the Independent Payments Advisory Board.

Brady admits committee analysts could not fit the entire health care bill on one chart. "This portrays only about one-third of the complexity of the final bill. It’s actually worse than this."

And the left's mad at Obama...

Tuesday, August 3, 2010

Nullification and Jefferson's Kentucky Resolutions

1. Resolved, That the several states composing the United States of America are not united on the principle of unlimited submission to their general government; but that, by compact, under the style and title of a Constitution for the United States, and of amendments thereto, they constituted a general government for special purposes, delegated to that government certain definite powers, reserving, each state to itself, the residuary mass of right to their own self-government; and that whensoever the general government assumes undelegated powers, its acts are unauthoritative, void, and of no force; that to this compact each state acceded as a state, and is an integral party; that this government, created by this compact, was not made the exclusive or final judge of the extent of the powers delegated to itself, since that would have made its discretion, and not the Constitution, the measure of its powers; but that, as in all other cases of compact among powers having no common judge, each party has an equal right to judge for itself, as well of infractions as of the mode and measure of redress.

From the
Kentucky Resolutions of 1798, secretly drafted by Thomas Jefferson in response to the Alien and Sedition Acts.

Particulary after my last post, I found Derek Sheriff's analysis of "nullification" as a political means to oppose the federal government's usurpation of individual rights to be very interesting. Such an approach falls more broadly within the so-called "Tenth Amendment Movement" which seeks to resist "federal tyranny" based on the idea that the federal government's power is strictly limited to the enumerated powers, and that all other powers reside within the states. He points out that in response to the passage of the egregious Alien and Sedition Acts, then Vice-President Jefferson secretly drafted the Kentucky Resolutions of 1798 "to convince state legislators that nullification was the most appropriate form of immediate resistance." Jefferson and James Madison ended up drafting what are now known as the Kentucky and Virginia Resolutions:
They argued that the Constitution was a "compact" or agreement among the states. Therefore, the federal government had no right to exercise powers not specifically delegated to it and that if the federal government assumed such powers, acts under them would be void. So, states could decide the constitutionality of laws passed by Congress.
Sheriff explains the basis of the nullification approach:

This scenario has nothing to do with overturning the constitutional order. In fact, it is precisely how the constitutional order was supposed to work in the first place. The use of nullification by states to neutralize acts of federal usurpation is both constitutional and revolutionary at the core. William J. Watkins explains it like this in his book, Reclaiming the American Revolution: The Kentucky and Virginia Resolutions and their Legacy:

“The Kentucky and Virginia Resolutions, written over two decades after the colonies declared independence from Great Britain, represent a reaffirmation of the spirit of 1776. At the core, the Resolutions are intrepid statements in favor of self-government and limited central authority. A product of the political and constitutional battlegrounds of the 1790s, the resolutions serve to link the federal union created by the Constitution with the aspirations of the patriots of the American Revolution. Indeed the touch of the author of the Declaration of Independence is unmistakable when one reads the Kentucky Resolutions of 1798."

Unlike the reformist strategy which seeks to mobilize power within Washington, DC in order to reform and redirect that power, nullification seeks to diminish and redistribute that power through relentless, decentralized, but ideally coordinated, acts of state level, constitutional resistance.

While it is vital to point out that fundamentally we are fighting for individual rights whether at the federal or state level and that we should not replace a federal tyranny with 50 state ones, I think as a tactic, the concept of nullification does have potential. This is because, as a practical matter, I think we have a better chance of establishing and protecting individual rights when 50 different states compete rather than relying on changing one disconnected federal leviathan. As Sheriff says:
Because government is such a dangerous concentration of power, American revolutionaries recognized the absolute necessity of limiting government power and dividing it into as many competing jurisdictions as possible. The hope was that under such an arrangement, the federal government would be held in check and people would have the option to move freely between more powerful, but competing states. Competition would keep their multiple jurisdictions from becoming intolerably oppressive.
For activists, I think this approach, and the history behind it, is definitely worth considering.

Monday, August 2, 2010

A Simple Question, A Simple Answer

This is a truly amazing video. At a town hall meeting, a woman asks Rep. Pete Starks (D) a simple question. If health care is a "right", it means someone else must provide it, which means the federal government must compel someone either to provide the service or to pay for it. However, she asks, wouldn't this violate the 13th amendment prohibition on slavery? And, if the government can compel such a service, what can't it do? Listen to lifelong statist and pragmatist extraordinaire Pete Stark's, uh, answer.

One Big Happy Family!

Breaking with precedent and citing the "difficulty" of the decision, the Ministry of Truth has implicitly deemed Fox News to be an official news network. Thanks Whitehouse.gov!