Category: Uncategorized

“What you do speaks so loud that I cannot hear what you say.” Ralph Waldo Emerson

In a recent Biden press conference he spoke about his choice for a nomination of a justice to replace the retiring Stephen Breyer, and that his choice would be limited to a black woman. In making the criteria for selecting a candidate based on both race and gender, the President of the United States acted so contrary to the principles he is supposed to uphold that all his pompous words about his respect for the constitution rang hollow compared to his actions.

While it was expected that Biden would nominate someone aligned with his party, it is unacceptable for anyone to construct such exclusionary criteria that is both sexist and racist. Add to this that although Stephen Breyer had made clear over the last year that, despite the Democratic establishment’s inappropriate pressure for him to retire, he had no intention of doing so.  Yet they persisted on the partisan reasoning that given his age there was the possibility of his retirement or passing while a Republican was president, Biden needed to make his mark on the court; apparently that pressure became irresistible and as it was based on Breyer’s age, also discriminatory. Further, consider Biden’s and his party’s threats to pack the court because it was out-of-touch with where society needed it to be, despite the principle of the separation of powers isolating the Supreme Court from any such consideration save constitutional jurisprudence.

There are many definitions given to hypocrisy depending on how many dictionaries you have, but essentially what they all come down to is the act of claiming to have moral standards to which one’s actions do not conform. With all the virtue signaling that we are constantly bombarded with in mass and social media, the contradictions are the one consistency we can find. Biden’s extraordinary action to exclude all others who do not meet a racial or gender qualification is not the only example of hypocrisy we can find in the polity of American society today, but it is one of the most egregious given his position as our president and his professed belief in our civil rights. However, there is a consistency in his hypocrisy when you recall his statement during a campaign interview on radio when he said “If you have a problem figuring out whether you’re for me or Trump, then you ain’t black.” Racism is not limited as a partisan trait, and neither is hypocrisy.

“It’s funny. All you have to do is say something nobody understands and they’ll do practically anything you want them to.” J.D. Salinger

The media coverage of the recent memorialization of the January 6^th riots at the Capitol provided a lot of commentary, much of which was a very confused collection of terms and interpretations. The main issue that I found was the lack of differentiation between a riot and an insurrection. Regardless of the political partisanship of the various commentators, all seemed to have one thing in common, and that was to say things nobody could understand in order to get their particular group to believe whatever that was; amazingly, and sadly tragic, that really does seem to work.

A look at American history and simple word definitions can help clear up some of that gibberish, together with listening to what was said on the day this horrible event occurred.  Let’s start with what President Trump said to the crowd at the rally that led to the violence. Now keep in mind that his supporters have used such ridiculous descriptions of what followed his speech as an “unscheduled tour” or a “peaceful protest”; we shouldn’t dismiss such obviously absurd statements without understanding similar stuff from those that criticize Trump and his followers deeming that riot as an insurrection, an attack on democracy, or an existential threat to our constitution; none of these factually or accurately define this event.

Trump’s speech was inciting to riot, a fact that your ears could tell you just listening to it. The fact that he called upon the crowd to go to the Capitol to prevent the constitutional process of electoral confirmation is clearly an attempt to cause a riot by urging other people to commit acts of violence; the results showed he was successful as regards the riot, unsuccessful in preventing the electoral confirmation. The question arises as to whether or not his actions also constituted sedition, and even further, insurrection.

An element involving both sedition and insurrection is conspiracy. It is obvious given the recent Congressional committee’s subpoenas that they are looking for evidence of conspiracy; while many documents have been obtained, such evidence has so far eluded them. Those that they have subpoenaed for testimony have either refused or agreed to do so but only under the protection of executive privilege. This later condition has been challenged as only applying to the President, but countered with the argument that it would be impossible for it not to extend to those that the President confides in or there would be no point in it; resolution to be determined, likely in time by the Supreme Court.

According to the statutory definition of sedition “It is a crime for two or more people within the jurisdiction of the United States to take, seize, or possess by force any property of the United States contrary to the authority thereof.” There’s that conspiracy thing that the committee would so want to have proof of. What becomes a little vague then is when does sedition become an insurrection, or is there a difference at all? Apparently there’s no hard and fast rule for that; we can consider both Shay’s Rebellion and the Whiskey Rebellion, both of which were technically insurrections, or if you wish “rebellions”, and both of which actually achieved their goals against debtor prosecutions and taxes, leading to the constitutional convention due to the former, and the founding of the original Republican Party with the later.

Then of course we have the ultimate insurrection of American history which we call the Civil War. As this blog has discussed before, technically and as recorded during the Convention, the Constitution by design has no prohibition against secession. What we know is that contrary to Lincoln’s actual statements regarding slavery, the Confederate States seceded on the premise that he would end it. If they simply stopped at that point, Lincoln would have been left with no legal basis for war against secession; however, in declaring themselves a sovereign nation, the Confederacy committed an act of war by attacking Fort Sumter.  

From its inception, insurrection is an integral part of American history and its political DNA. However, in all three of the above examples we have the element of “conspiracy” in that two or more people planned and executed an organized armed rebellion against established governments to achieve a specific goal. So in addition to conspiracy, we find a plan to organize and execute armed rebellion. In the case of January 6^th, should evidence be found that further to sedition, we have an organized armed rebellion, the goal was already stated at the rally where Trump incited the riot, i.e. prevent the Congressional confirmation of the electoral process.

Now if we look at all the video footage of that day, we can’t say that we see anything approaching a planned and organized armed rebellion. What we have is a bunch of crazed rioters breaking windows and doors, trespassing, vandalizing, assaulting guards, and in general acting moronically at the behest of a narcissistic loser. Since then, we have various reports of his family, friends and staff urging him to ask his crazed followers to desist, which he only did some three hours later, and at no time called in help for the police and guards to remove the rioters.

While we to this day still have to wait to see if any evidence can be found that supports sedition and insurrection, the House elected on January 13, 2021 Articles of Impeachment, charging Trump with “incitement of insurrection”. That’s a very confusing charge, something akin to the cart before the horse. Predictably given the lack of votes in the Senate, there was no conviction on that charge; however, putting aside the obvious partisan outcome, the charge actually provided cover for acquittal. I am left wondering why he was not charged for inciting to riot, which alone would constitute a felony charge and, by his own words, evidence of guilt and eliminate him from ever running for elected office again. Why such a repeated bungling like Trump’s first impeachment when in fact the House is mostly composed of representatives who are lawyers is confusing.

What the country really needs is to close the book on Trump, but apparently neither political party has an interest in that. The GOP shamefully continues his leadership while the Democrats bungle their attempts to convict him. It almost seems like both parties find him a useful foil to use in the upcoming mid-term elections; this will not serve the interests of the Republic, its constitution and the liberty of the people, but only the power lust of our two major political parties. Is that confusing? Yes, it is, but then again you’re only confused if you’re paying attention.

“Never argue with an idiot. They will drag you down to their level and beat you with experience.” Mark Twain

We can all remember those times in school when we would get distracted, not really paying attention. Paying attention is a vital part of learning and in understanding what is actually going on. It doesn’t always mean what you are being told is true, or in the case of the media even accurate. The most important thing that defines a good education is that you learned how to think for yourself, the skill of critical thinking; if you have that you are capable of arriving at concepts empirically without some robotic acceptance of someone else’s theories; in life, one needs to be a good detective to find what is true, and just as important, what is not.

Having that skill will enable you to come to your own conclusions and having the means to change them when additional facts provide you better information. However, having that skill will not insulate you from those that don’t. When presented with statements that you find wrong and question them, but receive arguments that are irrational or factually wrong, you can still have a civil discourse provided the other party is acting in good faith.  However, if the arguments are based on a claim of expertise, greater good, superior education, virtue or vision, or otherwise dismissive, then the other party is not acting in good faith; it’s not about the merits of their position, but their egos. What you learn from people like that is that they’re narcissistic and can only listen to their own voice, a trait honed by years of experience.

The attitude that the public in general is way too stupid or uneducated to understand what is best for them usually means you’re dealing with partisanship, an elitist attitude, or as often is the case, a politician. When it involves politicians, it is easier to understand the pattern of crises we have had, especially ever since the Presidency of Woodrow Wilson, with wars and economic chaos, much of it self-inflicted wounds; as Congressman Ron Paul once observed “It is no coincidence that the century of total war coincided with the century of central banking.” Throughout history, such leaders are attracted to war as the ultimate ego trip; they all wanted to be a wartime President. There is much truth in Isaac Asimov’s observation that “Violence is the last refuge of the incompetent.”

War is expensive, and financing it through taxation would cause opposition; the easier way is to monetize debt, but to do so would require the tools of central banking. Please see my post entitled “Remember Hyde” of 09/25/20 regarding the creation of the Federal Reserve. This same process that supports the “Warfare State” also serves well for the “Welfare State”. Over the last century we can see the evolution of the US from a nation of production to what Murray Rothbard described: “The State provides a legal, orderly, systematic channel for the predation of private property; it renders certain, secure, and relatively ‘peaceful’ the lifeline of the parasitic caste in society.” Taken together, as is historically the case, the synergy between the “Warfare State” and the “Welfare State” will eventually impoverish a nation with a voracious appetite for its wealth.

Biden ran for President on the proposition that he would heal the polarizing divisiveness and end the chaos that Trump created. He promised to bring bipartisanship back to Congress, but instead has had to manage the divisiveness within his own party created by the personalities and agendas as conflicting as that in the Republican Party. We have Sanders and Manchin as clear examples of the enormous divide among the Democrats as we have Trump and Romney in the Republican Party. This political pandemonium may well result in the fracturing of both major parties, and maybe that’s a good thing given that the Biden administration set out a series of policies requiring the most expansive programs in US history, and at a time when we’re recovering from a pandemic and bringing our economy out of a devastating lockdown; coupled with a crushing debt already exceeding $29T, such policies seemed like the rantings of fools. To be told that this would all be paid for without raising taxes, except of course on those evil rich people, had Americans wondering why they were being treated like idiots; we’ve seen this movie before.

At the same time, the Fed proceeds with a QE so expansive that the one from the Financial Crisis of 2008 appears hawkish by comparison; add to that the UST expanding the currency by 348%, and you have the witches brew for serious inflation. Contrarily, the administration downplays inflation as transitory, a phrase recently abandoned even by the sycophants at the Fed. Senator Warren tells us that inflation is merely businesses price gauging. The President’s staff attempts to set up Senator Manchin as having agreed to the grotesque socialism of the “Build Back Better” plan, which he has repeatedly and publicly stated he doesn’t support. Secretary Buttigieg of Transportation holds a press conference to explain how drastic government spending will result in greater production and not add to an already crushing debt.  Chairman Powell reverses course on monetary accommodation but continues to delay tapering or raising interest rates. President Biden continues rattling sabers in Putin’s and Xi’s face over issues that are neither a territorial nor security concern of the US. Illegal immigration has reached the highest level in US history. The President issues mandates like a king would edicts, ignoring the very constitution he is sworn to uphold; if he really had a good idea, he wouldn’t need a mandate to begin with.

Biden’s approval rating over the last year has declined dramatically, and continues to do so as inflation erodes real wage growth, now down 1.9% from 2020, and inflation 8%, contrary to what the administration predicted, and this despite all the “free” stuff government provided. Any intelligent person knows that there is no such thing as free; someone’s got to pay, and that someone, in some way, shape or form, is the US taxpayer. While we await a new tax bill, where does all that free stuff come from? It comes from the most insidious tax there is, known as inflation. Surprisingly it is a few members of Biden’s own party that thankfully stand in the way of making matters even worse with the passage of “BBB”, but for how long?

The administration’s accounting gimmicks to make the programs appear less costly are so obviously deceptive that even politicians find it hard to disguise or ignore. Regardless, it’s likely that the administration will take a phased approach in the coming years by including various elements of BBB as part of other legislations, a political sleight of hand meant to deflect attention.  This seems to work well as it has been shown that most in Congress fail to even read a bill’s text. Many say that trick has a time limit as the November 2022 midterm elections are likely to cost the Democrats control of the House or Senate, maybe both. Of course, that assumes that Republicans will be better caretakers of our tax money than Democrats; don’t bet on it.

Both parties when in office have shown the ability to use a crisis as an excuse to expand and retain power through financial gimmicks and economic manipulations, and ended up with a nation the poorer for it. While the public responds to polls on approval ratings, including how the president is “managing the economy”, it ignores the essential question as to why we assume that government should be doing so to begin with, especially given the horrific results of that over the last century. The same holds true with foreign policy, which has devolved from a congressional to a presidential power, more often resulting in violence than diplomacy, and usually against the wrong parties, squandering the lives of many and the resources of our nation.

We now have an administration in a similar chaos as before, and at a most dangerous time. The planners have changed, but the plans remain the same, just wrapped in different language in order to deflect or even conceal the truth, what we should call propaganda. What Americans need now more than ever is critical thinking.  We need to understand that due to these failed policies over such a long period of time, the Fed and the UST have painted themselves into a corner; if they end “accommodation” with currency reduction, tapering and/or raising interest rates, we will have a recession, but if they don’t we will have extreme inflation, which will cause a recession. We need to face the reality that there will be pain that we will have to endure due to the policies of those that we have put in positions of power. Before we put them in that position again, think twice – critically.

“Now if there is one thing that we do worse than any other nation, it is try and manage somebody else’s affairs.”  Will Rogers

There are two international hot spots on the current administration’s radar that urgently need reassessment, Ukraine and Taiwan.  Neither represents US territorial interest or spheres of influence, neither are existential security issues for the US, and both are best left to the protagonists to sort out without the US doing its usual crises baiting to get their allies or their citizens concerned about. In other words, we don’t need another Afghanistan or Iraq adventure that not only represents no benefit to Americans, but more misery and a loss of resources we are better off employing for ourselves.

Take first the Ukraine, which has been a part of Russia for nearly 200 years, from 1793 to 1991. Much of the population is ethnically Russian, few even speak Ukrainian, and the majority of the people have no interest in a bloody conflict to decide which authoritarian heel will be on their necks. The EU has no interest in confronting their major source of energy so Putin can shut off the gas valves, and the trade value between the EU and Russia is far more important to Europeans that the US going on another crusade to make the world safe for democracy while creating a refugee crisis on their eastern borders. Given the US track record of incompetence in such interventionist escapades, we should not be surprised. Even if US actions against Russia are limited to just more sanctions, the destabilizing effect on some teetering European economies is unwise, and likely to have little impact on Putin. We should heed the words of retired Congressman Ron Paul who said “Sanctions are not diplomacy. They’re a precursor to war and an embarrassment to a country that pays lip service to free trade.”

Except for a fifty year period of occupation by the Empire of Japan, Taiwan was ruled by China from the Qing Dynasty of the 17^thC until 1949 when the Republic of China withdrew from the mainland after losing the Civil War to the Communists. In 1973 the US recognized the PRC’s claim to Taiwan under the One China Policy. Here we have a country that has become a world power, second largest economy, ever growing military, that not only has a legitimate claim on that territory, but one that the US formally recognized. So why then has the Biden administration made moves to divorce us from the One China Policy? What business is it of ours to dictate to China contrary to what we have already acknowledged? Consider how Americans would feel if Mexico disputed Texas as a part of the US despite the treaty that ceded its claims. 

Eisenhower warned us about this plague that has haunted and infected us for generations, what he called the Military Industrial Complex. It is a narcissistic phenomenon of blood for money, a pathological condition of thinking we are the answer to the world’s problems when we can’t even manage our own. This hubris will be our ruin as a warfare state, and domestically the same as a welfare state; the two seem tied at the hip in a dance that we keep tripping our feet over.

The US really has to move on and recognize that we as a people are not obligated to provide our youth and resources as the world’s police, and ethically should avoid doing so. To meddle in the affairs of other countries is not an honorable policy, deserves no glory, usually results in the opposite outcome than intended, and leads to more conflict than peace.

“True freedom requires the rule of law and justice, and a judicial system in which the rights of some are not secured by the denial of rights to others.” Jonathan Sacks

A few months ago I listened to a news program, I believe on BBC, about Jonathan Sacks who died last year. The program spoke about his influence on British political thought, and about his career as a former member of the House of Lords, a British Orthodox Rabbi, philosopher, theologian, and a well know public figure in the UK. At first it had no resonance with me as I knew little about him, but when they discussed his statement above that was particularly relevant to the current discursive discussion of race in the West, that resonated.

When compared to the mind numbing and perverse theories of White Supremacy, Critical Race Theory, and other collectivist and tribal theses, the Sacks’ quote makes the connection of concepts with systems and rights with such clarity, and yet so succinctly. I would have loved to have seen him as a guest speaker in American Universities and our Congress; likely he would have been shouted down and canceled in our current culture of misguided lock-step beliefs that are saturated with both obvious and subtle racism and classism. This is so regarding advocates of racial theories from all political groups, as if equality is a zero sum game, with rights that need to be rationed on the basis of race, and who is the perceived oppressor or oppressed.

I always found the biblical story of Adam and Eve in the Garden of Eden being expelled because they ate the Forbidden Fruit from the Tree of Knowledge providing two metaphorical messages; one that knowledge is a sin, and two that this sin can be transmitted genealogically. While original sin is religious dogma, there are equivalent ones held by the perpetrators of White Supremacy and Critical Race Theory; in both cases belief in defective racial characteristics informs their theses and inspires their political activism.  

While many people today do not subscribe to the belief in original sin as they see it as a moronic and vile concept, unfortunately many also fail to see the absurdity of ascribing to a human being an inherent inferiority based on their race. I am not making this criticism as a justification for some of the perverse concepts of equality; empirically no one can be equal to anyone else, and in fact the same person is not even equal to themselves at different times. While all should be equal under the law as Saks notes, it is absurd to think that any two human beings can be equal to each other; that would destroy the very concept of an individual, of actually being human.

Therefore it follows that each and every human being should be respected as an individual, each with their own characteristics and abilities, but all with the same rights under the rule of law and justice, and at no time can any human being be deprived of those rights in order to provide advantage to another. While this fundamental concept of liberty is imbedded in the founding principles of our nation, and in our very constitution, it has been violated through much of our history. It is this disease of racism that is the cause of the internal strife in American society, yet unfortunately we actually perpetuate it and often with ideas that we profess are meant to cure it.

As an example we have the case of the Parents Involved in Community Schools v Seattle School District No. 1. The District provided students’ parents the option to apply to any high school of their choice but also used racial quotas to maintain the diversity of the district. The Parents sued the District and the case went through the process of circuit courts, finding its way to SCOTUS in 2007. While there were the usual precedential arguments as this was not the first time for such a case, SCOTUS found that the District’s use of racial quotas violated the Equal Protect Clause of the Fourteenth Amendment. As Chief Justice Roberts stated, “The way to stop discrimination on the basis of race is to stop discriminating on the basis of race.” While SCOTUS’s ruling seems common sensible for such an obvious case of racism, it has not always ruled consistently on the issue. There were cases before and after this where SCOTUS ruled in confused and equivocating fashion regarding Affirmative Action, such as in the 2003 case of Grutter v. Bollinger, and other instances where racial quotas were employed; but the Parents v. District case did provide a precedential basis on which the law and justice are served.

For those who think that the cause for White Supremacy is fading, don’t be misled as the Klan is still very much alive, and in fact is reinvented with the rise of other such groups like the Proud Boys and the Oath Keepers. For those that think that racism is limited to those groups, again don’t be misled as we have Antifa and DSA that embrace CRT. What is common to all these groups is the primitively collectivist thesis of race as a determinant of rights.

Inherent in all racism is this primitive tribalism corrosive to any civil society, whether that’s between whites and blacks, Han and Uyghur, Arab and Jew, the list goes on and unfortunately is plagued by seemingly intractable misconceptions of humanity manifested in both advocacy for and against racism. The concept of Aryan superiority is so obviously moronic that it does not require a high level of intelligence to reject its premise. However, while the same should be true of CRT, it’s apparent that it is making progress in infesting not only political activism in America, but in our educational institutions.  There are actually k-12 school districts mandating its inclusion in curricula. Like all forms of racism it basically rejects the natural laws of humanity, particularly those of the Enlightenment and the rise of Classical Liberalism as institutions based on Western Civilization inherently structured to oppress those who are not white, and that this whiteness is an unavoidable characteristic of all white people. Yes, the theme of original sin lives on, and in this obvious form of racism now being taught to children.

Contrary to what most Americans think, CRT is not new.  It has its roots in early post WWII America, and has informed many political activists since that time. The movement for Reparations is based on CRT concepts. The definition of reparation is making amends for a wrong one has done, most often by paying money or some form of help to those one has wronged. Since nearly none if any slave owners or slaves are alive today, the only logical basis for such reparations has to be racial. When I consider that this is proposed by many politicians today, I wonder how stupid they think Americans are when they tell us to end such racial divisions which they themselves have promoted for years.

Unfortunately what we have in America today is a widening gap on racial issues providing an opportunity for unethical politicians to manipulate to their advantage, and that is clearly the case in both main political parties, making tribalism that which informs much of the race discussion; as Thomas Sowell so eloquently put it, “Have we reached the ultimate stage of absurdity where some people are held responsible for things that happened before they were born, while other people are not held responsible for what they themselves are doing today?”

Unfortunately as absurd as Sowell may find our current condition, it is difficult to maintain an optimistic view regarding racism in America’s future. That said, and being an optimist by nature, I am heartened to read articles about parents groups taking action against the educational institutions that seek to include doctrinaire curricula such as CRT and racial quotas in our schools. The hope is that we love our children enough not to burden them with the psychological damage inherent in all racism.

In anticipation of the upcoming annual Economic Policy Symposium in Jackson Hole that started this past Thursday, many financial news organizations interviewed various Federal Reserve Governors regarding the published program agenda, entitled “Macroeconomic Policy in an Uneven Economy”. While many of the questions were scripted to the Federal Reserve’s narratives, there were some that were well on point regarding Fed policy and actual economic conditions, which the Governors should have, and in some cases did anticipate.  The answers were interesting in the jargon used to either avoid hard questions or spin like Orwellian Newspeak.

One question posed was what did the agenda title actually mean? I imagine that much of the public would not be able to tell the difference between macroeconomics and microeconomics. The phrase and definition of macroeconomics was first proposed by John Maynard Keynes in the 1930’s as a proposition that governments should decide on economic policy. Before then autocrats in monarchies and other authoritarian countries simply decreed whatever economic regulations they wished. Keynes attempted to raise such dictates to a science. We have another invented term as a corollary, i.e. microeconomics as the study of those decisions of individuals and businesses; seemingly regarded as the lesser stuff even though it’s what makes for an economy in the first place.

Now go to “…in an Uneven Economy” for more discursive thinking.  The answers were many and varied, but one consistency that became apparent is that no one could provide a coherent answer, but also none of the answers were consistent among the Governors.  This should be expected with an agenda so vague and ambiguous. All economies by nature are “uneven” as the very genesis of the discipline we call economics is about scarcity, i.e. if there was no scarcity in the world the study of economics would be meaningless. Further, no matter what policies any bureaucrat can conjure up they will never make any economy “even”, and empirically have made them worse.

Then we have the telling question for which we get very creative spinning. The question was “Is the Federal Reserve at all concerned about increasing inflationary trends far greater than either its target or its expectations, and the fact that it no longer appears to be transitory?” To the first part the answers were somewhat dismissive as if inflation did not exist or was unimportant; for the second part the answers by some governors were truly creative and included a common theme, i.e. we should not be thinking about the current inflationary trends as “transitory” but “episodical”. Wow, that one sent me to my Webster’s as I was not sure it was a real form of episode, but the Governors were grammatically right on, although regrettably disingenuous. The term itself regards a series of interconnected episodes, or in other words not something transitory, but something of a longer, and perhaps indeterminate duration. So there we have it, spinning a situation in such a way that we can actually see the spin.

Not to be swayed by the spinning, some more adventurous interviewers ventured into the QE area and the related topic known as tapering. The term “Quantitative Easing” first arose in the public lexicon in 2008 when the Fed started buying UST securities in order to increase the money supply.  But what do you buy that with? No problem since the Fed simply orders more Federal Reserve Notes, i.e. US dollars, from the UST’s Bureau of Engraving and Printing; it’s monetary inflation on steroids. Those USDs are in turn distributed to the regional Fed banks, who are required to put up collateral for the new money circulated; they in turn distribute the new money to the various commercial banks and lending institutions. It’s kind of a trickle down process, but the first at the trough are the big investment banks where their large clients in corporate America come to feast. Easy money at Fed repressed rates, creating the booming valuations in stocks and real estate, unfortunately at the expense of those dependent on market determined interest rates.

The spin on this starts with the name itself, which would indicate that there is some unnatural restriction that has to be eased, when in fact the reality is that investments and lending, in many respects similar but not always the same, should actually decrease as risk increases. This is the free market’s way of cleansing itself of bad assets and actors in the economy and redirecting money to where it will provide return on investments that would attract further investments, and so on, leading to real growth and the prosperity and jobs that come with that.   

When the Governors where asked about the plans for the Fed to “taper”, i.e. buy fewer UST securities and/or allow interest rates to return to market functions, and/or cool off the printing press, we get very fluid responses ranging from later this year, 3Q next year, or as late as middle of 2023. Asked if they think delaying tapering or continuing with their other “tools” would overheat the economy, or make our national debt even more of a dangerous burden, and we get varied responses, but again with a new consistent buzz word, i.e. the need to “balance” many considerations.

The first thing to understand is what the Federal Reserve Act mandates economically to begin with, and there are only two considerations, i.e. work to assure maximum employment and minimum inflation; admittedly these are inherently contradictory goals, but who are we to question the wisdom of Congress. The second thing to consider is the word “balance” as in a balance sheet.  One of the Feds financial regulatory duties is to assure stability in the banking system, and one of the procedural tools it uses is a financial stress test focused on a bank’s balance sheet, i.e. a bad balance sheet translates as a bank in financial stress. By all measures in that regard the Fed’s balance sheet is stressed beyond belief, itself dependent on the life support of massive doses of paper money as if it grew on trees….well close, dollars are printed on cotton that grows on a shrub, but let’s not get picky, no pun intended.

In summary the Fed has spun out of control, even by the metrics of so called Modern Monetary Theory; theories are nice as an academic exercise, but empirical evidence shows that MMT is little more than failed economics. When interest rates approach zero while inflation increases, you are essentially already at net negative rates, so the Fed’s open market operations such as QE are not only no longer effective, but are doomed to failure. Consider the fact that since 2008 we have had QE1…2…3 …4…get the point?

Dating back to ancient Rome and its imperial regimes, the need for more and more money to finance its hegemony of the then known western world, so devalued its wealth time and again until it imploded; Rome fell because it failed economically, and politically from within, and not because of some barbarians at the gate. Beware America, history has a way of repeating itself.

While mass media wrestles with the blame about the debacle of Afghanistan, and whose fault it is, and whether Trump lied about his conditions for withdrawal, and whether Biden ignored the intelligence reports on embassy evacuation or just simply lied about them, it’s all so painfully meaningless; so much sound and fury, ignoring the obvious.

The obvious question is why were we there to begin with?  The propaganda narrative, entitled “Operation Enduring Freedom”, was to destroy Al-Qaida, perpetrators of the 9/11 attacks, and to destroy the Taliban government. That government arose in 1994 when the Mujahedeen that defeated the Soviets in 1989, in turn went on to defeat the corrupt warlord dominated government that arose in the aftermath of the Soviet defeat.

What we should understand is that the 9/11 attacks were perpetrated by 19 terrorists, 15 of whom were Saudis, 2 UAE citizens, one Lebanese, and one Egyptian; not only were none Afghanis, but the funding has been confirmed to have been from Saudi elites. Did we get our geography wrong or were we stupid enough to believe the false narrative, and for twenty years!

In that time, the casualty list is appalling: US military 2.5K, US allies about 1.1K, US contractors about 3.8K, Afghan military about 66K, Afghan civilians about 47K, and the “enemy” about 51K; these figures do not include the wounded, many permanently disabled. Please note that the causality rate among Afghani civilians is nearly that of the “enemy”; we killed nearly as many civilians as the “enemy”, so who were we there to fight?

This does not include the devastation to the US economy; while this and the Iraqi War cost Americans about $2T, now $6.5T including interest since the US doesn’t “pay”, it barrows endlessly, the real question is not who ended this wrong; it’s who started this moronic ideology to begin with? The answer to that is not acceptable to those who deflect the issue to who’s to blame for what just happen with the US evacuation of our Embassy in Kabul; that was as inevitable as what happened in Saigon 46 years ago.

So here we are, nearly a half century later than the end of the Viet Nam War, with the same inevitable results, and the real question is what have we learned at these terrible devastating costs? Have we degenerated hopelessly into a warfare state, where by executive order we leash hell on our own, helpless civilians as collateral damage, and an economy so indebted to mindless violence that we kill nearly as many innocents as some poorly defined “enemy”?

While Congress grapples with the stupidity of another $3.5T in spending, consider some simple housekeeping to stop the military adventurism draining this country’s resources; let’s close the 800+ military bases in about 70 foreign countries; stop stupid money like the $1.5T F35 development for a plane that can’t even fly; and above all, return war powers to the only constitutional authority, the Congress of the USA, and end the despotism of executive war powers.

We have heard from various administration officials over the last few years how their decisions on policy will depend on the data and not some theoretical modeling or a priori intuition. Sounds a lot like empiricism, the basis for the scientific method, which relies on evidentiary proof based on actual life experience.

One of the problems that arise with data is when it’s subjected to an interpretation that supports a predetermined narrative. What’s needed in cases that are inherently subjective is an historical reference to what has been empirically established, if available, and not something viewed through the prism of what conveniently fits into some narrative. Unfortunately, that may not always be available.

Another problem is that quite often the data itself is misrepresented; this may be through omission, distortion or outright lies. We may not know that at the outset, but eventually it will become apparent either through further analyses or just plain calling out those who sought to mislead for whatever reason.

In either case this will create confusion not only about the decision making process, but the purported facts on which it relies. This issue is not isolated to any particular business, political party or institution as the lack of integrity and/or intelligence in policy making has become quite commonplace. We should always keep in mind Hanlon’s razor, which states “Never attribute to malice that which is adequately explained by stupidity.”

I am not suggesting that everything can or should be determined by data as neither common sense nor principles are subject to quantitative analyses. However, when seeking to understand natural or behavioral phenomena, good data, objectively researched and interpreted, will provide an empirical basis of understanding. That sounds all well and good, but if we judge our leaders and their so called experts based on experience we are left with a contradiction as the evidentiary proof is contrary to the policies adopted.

In economics, the most data saturated discipline there is, we can see examples of how data was used successfully or irresponsibly. Looking at just more modern presidential administrations provides us with some comparative illustrations. Nixon, who wanted to have no monetary restraints, and readily admitted that he was bored with monetary issues, severed the dollar from the gold standard.  The results were catastrophic as the dollar plummeted to the point where US Treasures’ had to be denominated in Swiss Francs in order to attract buyers; the obvious calamity of runaway inflation and lack of investment caused the infamous “Stagflation” that plagued the US for decades.

Eventually Paul Volker was made Fed Chairman under Carter and Regan, instituted policies that from 1979 to 1987 managed to stabilize the dollar.  With Regan and Clinton we get some data driven sanity through tax, health and welfare reform, fiscal restraint, investment incentives, free trade policies, etc.

I think it was the campaign strategist James Carville that told Clinton’s staff that the most important message they needed to understand was “It’s the economy, stupid!” Clinton’s campaign did not direct that message in those terms to the electorate, but they definitely got the message. The recession was not being properly addressed by George W.H. Bush’s campaign and that cost him the election. 

It took over two decades of fiscal restraint and reforms to eventually manage a recovery, and realize deficit and debt reduction to a degree that actually resulted in a surplus. That’s what honest data driven policies did for this country back then, and we sorely need that now.

Instead we got Trump, a president about as ignorant of economics as he was of ethics, a narcissistic reality show host that was incapable of dealing with reality. True he cut taxes, which mostly benefited the rich and corporate elite, but at the same time spent money with no focus other than to manipulate the market to benefit his cronies on Wall Street; all of that was clearly done despite the data that screamed further deficits and debt. When Jerome Powell started tapering CE in late 2019, Trump threw a tantrum even before Wall Street could, and Powell, the ever ineffective sycophant that he is, immediately reversed course.

Trump’s sole contribution to health reform was to attack the ACA; true, the mandate was a horrible breach of constitutional and ethical standards and should never have been enacted, but he offered nothing else to reform what the data showed was an ineffective and wasteful system.

He eviscerated free trade with an avalanche of sanctions and tariffs that in reality were nothing more than taxes on Americans; you didn’t need a data base to figure that one out. He promised to stop the endless wars in Afghanistan and Iraq, but failed to stop the fiscal and physical bleeding. He declared war on immigration, a strange policy considering a nation that thrives on it both economically and culturally.

It would be hard to see how things could get worse, but never underestimate a politician’s power lust.  In just a few months the Biden administration makes Trump’s irresponsible policies comparatively benign. I remember how we were all appalled at the record deficit the Trump administration had created, adding to a debt burden that screamed for relief; Biden’s administration is working hard to make that many times worse.

When even the OMB, ever more Fed governors, the GSA, and even some Wall Street elites who benefit from the most drastic CE in history, speak to rising inflation, we are told by the administration, and of course the ever accommodative Chairman Powell, that it’s all transitory.  Now here’s where the data makes either fools or liars of them all.  Since the Federal Reserve was created in 1913, the US dollar has lost 95% of its value as of 4Q 2019 due to monetary inflation.  Since then, even more to the point where the Fed now owns 76% of the Federal debt, a debt most economists know is likely to end the dollar’s status as the world’s reserve currency, and destroy the wealth of many Americans.

Artificially repressing interest rates has only exacerbated the problem.  With real inflation running over 5%, and the UST 10 year yield at about 1.25%, we have an actual negative rate of 3.75%. Understandably the Fed has had to step in and buy the debt as foreign sovereign purchases declined as the US Treasury is no longer a safe haven. The famous writer of the Dow Theory Newsletter, Richard Russell, once said “He who understands interest earns it. He who doesn’t understand interest pays it.” History has shown that there has never been a fiat currency that has not failed; eventually, in some way, shape or form, debt will take its tool.

“If you don’t read newspapers you are uninformed; if you do read them you are misinformed.” Mark Twain

The 2021 survey of trust in media among 46countries that are deemed to have a relatively free press by The Reuters Institute for the Study of Journalism at Oxford University ranked Finland first with 65% of its citizens trusting its media, and the US last with media trust at only 29%. The majority of Americans surveyed responded that they found that the media has embraced advocacy journalism, particularly for the “woke” movement, and found the media overwhelmingly biased in favor of the current administration and alarmingly supportive of that same woke movement, resulting in a quasi-state media where journalists are more bound to the government’s embrace of ideology rather than independent and objective reporting.

Those surveyed also expressed dismay at the lack of support for free speech manifested by the call in both government and mass media to pressure social media to censor anyone questioning that trend. In summary, they consider the media in general to be an echo chamber of ideology rather than a reliable information source. This included many that were opposed to Trump, but found Facebook’s and Twitter’s cancellation of his accounts a troublesome example of the slippery soap of the cancel culture regarding free expression.

While this phenomenon is ostensibly different than the PRC’s closing down “The Apple Daily” in Hong Kong for its open criticism of the crackdowns, and arresting its journalists, it is still alarming that the most revered liberty of American constitutional law and free expression culture is so obviously under attack by a minority radical movement whose ideology is embraced by the press and our own government. It was the prior administration that coined the phrase “fake news” in criticism of those in the media that criticized it, and whose supporters embraced such claims even to the extent of accepting the false narrative of a fraudulent presidential election.

Among the news organizations in the US we have Fox at 46% trust and then CNN, MSNBC and Buzzfeed at 37%; things decline rapidly thereafter. So where then can Americans look for reliable, fact based and unbiased news? There then is the dilemma that provides a mere overall 29% trust rating. But what was hopeful is that local news had a 58% rating. Apparently trust of news organizations on the national level declines markedly. Interestingly, trust in government has a similar phenomenon with the local doing much better than state, and state better than federal.

Trust is an easy thing to lose as it doesn’t take much for that to happen. Many political scientists have found that one of the main reasons for the swings in partisan success in America is the extent of wrong doing by those in power. Nixon won because Johnson made so many social and military blunders; Carter won because Ford was so tainted by Nixon’s Watergate; Regan won because of the incompetence of Carter; Clinton won because Bush Sr. ignored the economy; Obama won because Bush Jr. lied about so many things; Trump won because Hilary was such a manipulative politician who alienated so many people; Biden won because Trump was such a narcissistic moron. 

This decay of trust can be seen in differentials of approval ratings of recent Presidents reported by the five top polls; while there are variances in these polls, the average mean is telling. The most radical are found with the Bushs’ at around 60%; Americans don’t like body bags. Clinton, Regan and Obama all were around 30%; while reasons varied, consistency paid off. Amazingly Trump was the lowest differential at 15%, but then again he had consistently low ratings to begin with. For Biden it’s too early to tell; currently he has a 52% approval rating, but he is saddled with a wide ideological gap within his own party. Luckily for him, the Republicans are likewise fractured, perhaps even more so. The percentage of American voters who regard themselves as independents has steadily increased since 2000, now at about 41%, leaving 31% as Democrats and 26% as Republicans, and the balance with various third parties.

So along with the decline in trust, both in media and government, we have a decline in major party affiliation. But the swings in voting tendencies also indicate confusion, which coupled with distrust makes for a volatile political climate, increasingly polarized among shrinking partisan groups. In the past the press played an important role of informing the public somewhat objectively, providing a modicum of a reliable basis for a peaceful realignment and emergence of viable alternative parties.

The echo chamber of current times does not provide that. What we have instead is growing dissatisfaction, alienation and radicalization. History shows that one potential outcome is a chaotic and potentially not so peaceful realignment of political affiliations. Regardless of how it happens, the two major political parties are likely near the end of their era. Depending on what the political landscape that emerges looks like, that may very well be a good thing.

So what do we do about the echo chamber? Unfortunately for the average American there is very little to be done to change the current journalistic paradigm of mass or social media.  The best course may be abstention; shut off the noise, grab some classics to read, avoid sound bites, think in a common sense mode and follow your gut. While you may not be deemed the most informed, you will be a lot less misinformed; but be careful as George Orwell cautioned that “The further a society drifts from truth the more it will hate those who speak it.”