Libera Voce

Being Yourself

Free speech is the expression of being you, the ability to express your beliefs and aspirations. Now consider what we are being told about being “woke”, a phrase that holds much to be wary of. According to that proposition you apparently are asleep socially and politically, and therefore not really a valid being unless you adhere to what you are told by those that profess to know what existential meaning is; should you deviate from that, you will be canceled; hence the term “cancel culture”.

A critical definition of being “woke” is the act of being very pretentious about how much you care about a social issue. The dictionary definition of pretentious is even more to the point; it is an adjective describing someone attempting to impress by affecting greater importance, talent, culture, etc., than they actually possess.

Understanding meaning is essential to knowledge as without understanding there is no knowledge; if that makes sense to you, you are not “woke” and much the better for that. When just being yourself you don’t need a social crutch to help support or limit you, which is the essence of being an individual and capable of independent thought.

The whole point of being an individual is that you’re not just another nothing in some awful collectivist nightmare of non-being; how have we as a society lost that concept? It did not happen overnight, it was a slow but steading erosion of the respect for the individual, a concept called liberty.

Consider the current social stigma free expression may inflame in the polarized world in which we live, especially in this country’s institutions of higher learning where suppression of free expression is so accepted; it seems the more elitist the school, the more prevalent this phenomenon, which then appears to inform the behavior of so many of our other institutions. It is not surprising then to also see a rise in alcohol and drug abuse, depression and suicide among the younger generations. According to the founder of existentialism, Soren Kierkegaard, “The most common form of despair is not being who you are.”

There was a very good reason why the New England states, the birthplace of the American Revolution, insisted on the Bill of Rights being incorporated in to the US Constitution, and the first having to do with various forms of free expression such as religion, speech, press, assembly, and petition. Thankfully we have those, especially considering what Alexis de Tocqueville observed about American society during his tour of 1831, specifically that “I know of no country in which, for the most part, independence of thought and true freedom of expression are so diminished as in America. In America, the majority traces a tremendous circle around thought.”

Given the tremendous social upheaval of post McCarthyism America resulting in ever more respect for free expression, it is disturbing to see such a medieval back sliding to the conformity of ideas, and an ostracization of those that don’t comply. Imagine what the “woke” would have to contend with given personalities like Lenny Bruce!

What is it that the “woke” fear about free expression? How can we have a civil discourse in America without that? The definition of civil discourse is engagement in conversation intended to enhance understanding. The most important requirement for civil discourse is respect for the existential right of everyone to express their own individual thoughts on any subject and therefore does not represent a threat to anyone else’s beliefs. By definition, civil discourse avoids physical hostility as it requires consideration for other ideas.

To take the position that silencing someone because what they have to say is objectionable, and therefore represents a threat or violence against you, is to take the position of every dictator throughout history. One of my favorite quotes about liberty in regards to free speech is from George Orwell, who said “If liberty means anything at all it means the right to tell people what they do not want to hear.”

The benefits of free speech and the attenuation of civil discourse are philosophically known as a heuristic, a technique that enables someone to discover or learn something for themselves. The benefits to society should be apparent to everyone, especially anyone who claims to be an educated and enlightened person. It will lead to a more objective understanding of ideas divorced from the oppression of feelings that could be harmful to us and others as that may lead to actions detrimental to our wellbeing.

Based on this, psychologically it would be fair to say that being “woke” is actually a contradiction in terms relative to its current meaning as actually that represents a suppression of awareness in regards to others, a lack of empathy, perception of reality and an inability to objectively observe and consider anything outside of yourself; sounds dangerously similar to narcissism.

Politically and sociologically it is corrosive, creating a them-and-us conflict, the very essence of polarization. If you are not only unwilling to listen to another viewpoint, but willing to suppress it, how would you ever be able to understand it and therefore be able to judge its worth or have a meaningful discussion about it?

I’m sure we have all heard of the famous quote attributed to Voltaire regarding free speech that says “I disapprove of what you say, but I will defend to the death your right to say it.” Maybe the “woke” will wake up and catch up on centuries of the Enlightenment.

Suspension of Belief

“…a choice between the lesser of two evils is still evil.”

Consider for a moment what the real differences are between the two major presidential candidates, ignoring for the moment their personalities and underlying character, and just what they represent politically. That can be difficult given that Trump is such a narcissistic sociopath and Biden lacking in any principle other than how to play political gamesmanship; in fact it’s not difficult, but useless as they both represent egregious authoritarianism.

By all accounts, this coming election is remarkable for a variety of reasons, perhaps the most compelling being the projected turnout. One of the highest turnouts in presidential elections was in 1860 at 81.2%, with Lincoln versus, well a host of others, the complexity of the ticket too much for this post to cover. The highest turn-out to date was in 1876 at 81.8% with Hayes versus Tilden; it was also the most contentious election so far resulting in the Compromise of 1877, with the Democrats conceding the election to Hayes in return for an end to Reconstruction and the withdrawal of federal troops from the South; it was a time when black lives truly didn’t matter, it was all about winning – sound familiar?

Given the huge turn-out so far for the 2020 election with the mail-in option, the likelihood that the count will be more difficult to execute is a given, which will substantially delay the results, and will only add to the contentiousness. Another factor will be Trump’s apparent refusal to unequivocally accept the results should he loose, posing an existential threat to the constitutional imperative regarding the civil transfer of power.

We also have issues with the contentious environment of a pandemic, rioting, vandalism, economic suppression, unemployment, runaway debt, trade wars, seemingly endless military interventionism, cultural tribalism, scandal and investigations, all adding to a polarization obviating civil discourse and creating violent conflicts, and all during an election year; yet all we are offered is the lesser of two evils.

However, the most telling issue, especially considering the turn-out projections, is the lack of belief in the candidates. True, there are zealots for both Trump and Biden, but the apparent environment is one of acceptance of a choice of the lesser of two evils. If belief means trust, faith, or confidence in someone or something, it is sorely lacking in this election. On the Democratic side, we have a sad lost soul who seems to be influenced by whomever he last spoke to, and on the Republican side a delusional snake oil salesman whose only principle is to do and get whatever he wants at any cost, and always with other people’s money.

The American voters should not look at this situation and believe they are obligated in any way to choose the lesser of two evils; they should vote for someone else or abstain. Either will provide them the dignity of avoiding giving their consent for one of these two clowns to disgrace the office of the President of the United States any further. Yes, one will win anyway, but we should show some level of self-esteem and respect for our right to vote by not supporting either.

Then we have all the noise about election meddling by Russia, but Russia has always meddled with foreign elections, and has been doing what they call “active measures” for centuries and are very good at it. Social media is just the current tool at their disposal, and what they grasp, even more than current democratic societies do, is that ideas, true or false, when disseminated among the intellectually weak are more powerful than guns; it does not matter to them who wins an election as the distrust of the process is more important than the results.

Neither should we be fooled by doctrinal claims, like Trump espousing capitalism. As Justin Amash observed “For a person who claims to oppose socialism, President Trump spent a lot of time in his SOTU address touting central planning, federal intervention in nonfederal matters, and a big-government spending spree—policies that threaten our rights and undermine our long-term prosperity.” Nor should we be fooled by Biden’s proposed policies as anything more than socialist tax and spend programs with almost heart felt pleads about equality mean he has our liberty in mind.

It is a certainty that one of these two pretenders will be elected, but the reality is that a choice between the lesser of two evils is still evil. True liberty does not mean equality but free will; while that can be chaotic, you either accept that or accept authoritarianism. Trump and Biden are simply two sides of the same counterfeit coin, just different personas. The situation of having to choose between the two reminds me of what F.A. Harper said in 1949 regarding liberty that “It is of little importance whether a dictator gained his power by accident of birth, by force, or by the vote of the people.”

As to which alternative is better, i.e. voting for someone else or abstaining, it depends on what your political convictions are. If you want to vote third party, there are fourteen such candidates on presidential ballots, one with access to all electoral votes, some with half, some with just a few, but you have a wide range to choose from; also consider what message a third party vote will send depending on which of the two major candidate suffers the most in lost votes that were cast for others.

If you want to express your displeasure with a process that provides for only two likely contenders as a choice of the lesser of two evils, then abstain; remember, voting is not an obligation but a right, and also a message, and abstaining is still a message that you reject the premise of choosing the lesser of two evils.

It’s also important to note that no third party was allowed to participate in the debates on the pretext of meaningless qualification requirements, and more likely out of concern that the debates could actually provide meaningful content. The Commission on Presidential Debates is jointly sponsored by the Democratic and Republican political parties since 1987 when they took over from the League of Women Voters in a contentious coup critically denounced for its secretive “memorandum of understanding” that would decide which candidates could participate in the debates, which individuals would be panelists and what questions could be asked. The League rejected these demands and released a statement saying that it was withdrawing support for the debates because “the demands of the two campaign organizations would perpetrate a fraud on the American voter.” That was such a prescient statement of the obvious corruption of the vital role of debates in the electoral process, a shameful suppression of free speech that even Russian meddling would be hard put to effect.

Then there is the question that if a third party candidate were elected, could they be an effective president? The answer to that is difficult as there’s little if any chance of that happening, but if it did, Congress would still be a majority of the corrupt duopoly of Republicans and Democrats who would be so adverse that such a president would be unable to get anything done; on the other hand, at least we would be better off without the government doing more harm.

As the Libertarian candidate Jo Jorgensen recently said “Some people say it’s too dangerous to vote for anyone but a Republican or Democrat this year, but I ask isn’t this of all years the time you don’t want to repeat the behavior that has gotten us to this dangerous place?” Yes, it is!

Bubbles, Bangles and Boondoggles

“The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”

Bubbles

Since my previous blog “Bubble Economy” on 11/13/19, that bubble has grown even more ominous as we are soon to exceed $30T in our national debt. Does any rational person believe that the US will ever be able to repay such an egregious debt?

US Bonds, which used to be held in high regard by other sovereign states, principally Japan and China who at one time held 18% of US debt, are selling off by the billions. Fear that they would be holding the bag in the event of default is rising; it is not an irrational fear. To counter that lack of confidence the Federal Reserve bought huge amounts of US bonds with equally huge amounts of newly printed money from the UST; more air in that bubble.

With bonds, as interest rates fall prices rise, so with the lowest rates in history better to dump at a high since the yield is so pathetic. But then where to go for yield? Try the stock market, fed by such easy credit its valuations are pushing up prices beyond fundamental levels. However, given that the easy credit is fed by debt, where will that lead?

Well, we’ve seen that movie before; it will lead to where it did in 1929, 2007 and….well hard to say, but sooner than anyone will want. It may start on headline news, an algorithm gone wrong (or right), increased defaults and bankruptcies, all the above; inevitably such outsized debt, annually now larger than our GNP, will be called in and that will be ugly.

So why haven’t we as a nation learned from the past? Why do we make the same mistakes over and over again? An interesting comment of such behavior I recently read was from Thomas King, an American Indian writing about failed US policies regarding the native peoples of America, who wrote that “For an individual, one of the definitions of insanity is doing the same thing over and over again in the same way and expecting different results. For a government, such behavior is called policy.”

Bangles

Alexis de Tocqueville was a French political philosopher who wrote “On Democracy in America” after touring the country in 1831. His observations influenced much of written American history and political science in this country, and were comparatively critical of French democracy. He found that the republican structure and constitution of the US was a reason for its success. However, he was critical of much of its social structure like slavery, religious zealotry, the social suppression of free expression, and the political tendencies to affect the outcome of elections legislatively; on this last item he wrote “The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”

Well it didn’t take long for that to happen; stimulus anyone? Like any bangle or trinket, such as the $24 worth of glass beads that bought Manhattan, it’s meant to allure us into thinking it’s actually something of value that will improve our lives, while actually buying them, defended as a means to protect us from ourselves by waving the pandemic flag in our face. It’s a way for us to willingly sell ourselves out to the very crooks that locked us down for our own good and destroyed our means of livelihood.

Like an opioid, it has dulled common sense to the point that we actually have a situation where the US government now represents 70% of our GNP; but there is no product involved, unless you call debt a product. Yet, that is exactly what is being sold to the American electorate by both presidential candidates. In fact, despite resistance in his own party, Trump actually supports another stimulus in excess of what Biden proposes. Remember, this is the guy that has lived off other people’s money his whole life so this should not surprise anyone.

What has become obvious is that this election is on the auction block, will go to the highest bidder, and the account will be drawn from the pockets of the American people.

Boondoggles

Interesting word, first coined by a boy scout in 1927 to describe a uniform decoration; it later came to mean something of no value. It was often ascribed to government programs during the New Deal era wasteful or pointless but carried on anyway due to policy or political motivations. We have this today in so many government programs too numerous to cover. Let’s just take something we have all participated in, whether we like it or not; I’m talking about Social Security.

There are many misconceptions about the original law establishing Social Security, like it was initially voluntary; it was discussed as a voluntary annuity, but enacted as mandatory. It is true that benefits were not to be taxed, but that was amended in 1983. FICA deductions were supposed to be limited to the first $3K of income at 1%, but the limit and rate were constantly increased.

But why should there be a mandatory investment in an annuity that has no guarantee of return on investment like common annuities you can get from any financial institution, which have a guaranteed benefit and fixed rate? Answer is there shouldn’t be, but again this is defended as a means to protect us from ourselves, the panacea of all tyrannies.

Per the Trustees Report of last year, the Social Security Trust would go bankrupt by 2035. However, as it is a legislated entitlement, it must be funded, but with what? I once read an article in Forbes about the Madoff scandal wherein they gave a pretty good idea of exactly what a Ponzi Scheme is: “A Ponzi Scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources.”

Now consider the plight of those “new investors”; they are anyone who is subject to FICA withholdings and who will not be 62, the earliest age you can claim benefits, by 2035. Essentially, if you were born after 1973, you are paying into a soon to be bankrupt annuity. Would you voluntarily do that? The same goes for Medicare and Medicaid, both funded by FICA withholdings and deductions from Social Security benefits.

Again, it is a legislated entitlement, so it must be funded. However, it is no longer a sustainable trust as its liabilities exceed its revenues, so that means more taxes, more debt, or a combination of both. The Ponzi scheme collapsed and the angel investors to the rescue are….well you.

Now consider the ACA; it too was at first mandatory, but that mandate was deemed illegal, and its survival all together is likely to depend on Supreme Court review. If it were simply a network to provide information to acquire insurance it would at least have a viable legitimacy, but again, as with Social Security, voluntary is not how governments are prone to act. Choice is not an option when seeking the greater good.

End Game

While history has taught us innumerable times that you can’t spend your way out of debt, it is a lesson ignored. The most famous of those who proposed such madness was John Maynard Keynes. When Keynes was confronted with the failure of his ideas of endless spending and consumption as unsustainable in the long run and that they would prevent the markets from functioning properly, especially in recoveries, he cynically quipped that “In the long run, we will all be dead.”

When Trump was given a brief on America’s growing debt crisis in 2017 by the few remaining fiscally responsible members of his own party, his response was “Yeah, but I won’t be here.” The fact that this puts the futures of our children and grandchildren in jeopardy is irrelevant to narcissistic sociopaths like Trump and Keynes. The immediate need of those in power is to keep that power, and the means includes bribing the public with the public’s money.

Welcome to the United States of Debt.

Remember Hyde?

The metaphorical question is will we have the same ending?

Secrecy has a purpose now just as it did in 1910. The reasons vary, but conspiracy is top of the list. On November 20 of that year America’s leading financiers met on JP Morgan’s Jekyll Island estate off the Georgia coast. The secrecy was so complete that en route these men wouldn’t even use their surnames.

The agenda was to create a central bank. The reason for secrecy was threefold: one, Americans showed an historical distrust of central banks, and two, the public’s and Congress’s wariness regarding these financial manipulators, and three, two of the attendants were from government; the attendance by Senator Nelson W. Aldrich, Chairman of the Senate Finance Committee, and from Treasury, Assistant Secretary Abram Piatt Andrew Jr., gave an appearance of collusion.

The reasons they would provide their supporters in promoting acceptance was to avoid the economic chaos such as the recent Bank Panic of 1907 by establishing a central bank capable of providing liquidity in times of tight credit and lack of depositor confidence.

This was a disingenuous proposition since the panic was caused by a prior reckless expansion of credit for questionable ventures that ended badly, leading to failed banks and brokerages. The panic caused by those failures rapidly spread, freezing credit and causing depositor runs on banks. With the help of JP Morgan and his allies, liquidity was restored, but actually by those that caused the unsustainable credit expansion in the first place with dangerous fractional banking, a process of actually increasing the money supply without even the need to issue more currency.

In essence, this was a scheme to provide the banking system with a means to physically expand the money supply in order to maintain fractional banking and avoid the burden of the banks themselves having to capitalize their overextended credit. The product of this nine day meeting became known as the Aldrich Plan; it proposed establishment of a central bank called the National Reserve Association, with currency power, nationwide branches and a board of directors. The board would be bankers, but the US Treasury would be included. There was no provision in the plan for effective oversight.

When the plan saw the light of day as subsequently proposed by Aldrich to Congress, it was strongly opposed by a majority who saw how it would empower banks, expanding the influence of Wall Street financiers. What followed were three years of intense negotiating, a classic example of cronyism in which various congressional leaders somehow found their way to a mutually beneficial agreement with the banking industry and eventually passed the Federal Reserve Act of 1913 and sent it to Woodrow Wilson to sign. Although he did so quickly, he later stated that “I have unwittingly ruined my country.” How prescient a statement from such an unfortunate man who regretted much of what he did.

To give such power to the very source of the problem was indeed a tragic mistake. The ability to expand credit at the stroke of a pen, or now a stroke of the keyboard, is a financier’s dream. To enable Wall Street the ability to control markets that should be under no control other than the natural and spontaneous activity of those that produce the goods and services of the economy, what we call Main Street, is a manipulation against liberty of huge economic proportions. Herein lies the very cause of what we now call income inequality, a system of cronyism, not capitalism, yet bizarrely the latter is blamed for its own destruction by the former.

The original stated purpose of the Federal Reserve as the nation’s central bank was to have a safe yet flexible but more stable monetary and financial system. The fact that these goals were inherently contradictory was a concern to its critics, but their voices were lost in the euphoria of getting the ability to control and manipulate the medium of exchange, the life blood of a modern economy.

The mandate was adjusted overtime, principally in 1977 to “…promote effectively the goals of maximum employment, stable prices, and moderate long term interest rates.” While on paper, the Federal Reserve was to be independent from the government, it was a symbiotic relationship. In order to work as planned, the US Treasury and the Federal Reserve had to by necessity coordinate policy and operations in order to effectively operate under this mandate. Within the Federal Reserve there was the Federal Open Market Committee, the public voice of the Federal Reserve, whose periodic “Beige Book” detailed the Fed’s “forward guidance”, a euphemism for a planned economy. Americans love euphemisms, especially in order to avoid the toxic word socialism, even though in reality it’s what they got.

What this cabal of Jekyll created was a Hyde transformation of a free market economy to the monstrous evil of a planned economy to serve the self-gratification of the power elite. The metaphorical question is will we have the same ending?

How to Kill a Republic

The US Constitution is not what governs the people, but what governs those who govern the people.

“Of all tyrannies, a tyranny exercised for the good of its victims may be the most oppressive. Those who torment us for our own good will torment us without end, for they do so with the approval of their own conscience.” C. S. Lewis

There are two political systems that are often confused and assumed to mean the same thing; Democracy and Republic. To compound that problem in the US, the two main political parties have adopted these words as their political labels.

There have been many Republics and Democracies in history, and while they share some similarities, it is the differences that matter more. In a Republic, there are immutable rights established meant to assure liberty. In a Democracy the majority has limitless power over the minority. This is the essential and existential difference wherein one political system protects rights, and the other subjects them to political mandate.

In The Declaration of Independence man’s rights are stated first, and then that a government is created to secure those rights. Jefferson based much of what he wrote on the political treatises of John Locke regarding the equality of all men and their fundamental and inalienable natural rights of life, liberty, and property. Locke also stated that while these are the natural rights of man, nature did not provide the means to create laws to establish and secure those rights, nor to protect them or to adjudicate disputes among men arising from them; Locke stated that this was the purpose of government.

We are all familiar with the process through which we arrived at our constitution, starting with the Articles of Confederation, which proved inadequate to the task; it only provided for a Congress consisting of State representatives, which exercised all functions of the national government, empowered to pass, execute and adjudicate laws; there was no separation of powers or checks-and-balances, not a very good system for the preservation of liberty.

The Constitutional Convention was called to amend the Articles of Confederation to address these problems; however, the delegates choose instead to create what we know as the US Constitution. The concept of three branches of government and their separation of powers was derived from the French political philosopher Montesquieu, and used by John Adams in composing the Massachusetts state constitution, which formed the basis for the same in the US Constitution.

As John Adams wrote “The dignity and stability of government in all its branches, the morals of the people, and every blessing of society depend so much upon an upright and skillful administration of justice, that the judicial power ought to be distinct from both the legislative and executive, and independent upon both, that so it may be a check upon both, as both should be checks upon that.” This is another essential element of a Republic, providing not only a separation of powers but a system of checks-and-balances.

The proposed new Constitution was eventually ratified by the required majority of nine of the thirteen states in 1788 but only after the Massachusetts Compromise was adopted which required the inclusion of expressed rights, which were eventually adopted in 1791 as the first ten amendments known as the Bill of Rights.

Now having said all this, what is not always appreciated is that the US Constitution is not what governs the people of the United States of America. The US is not a Democracy but a Republic, and its constitution is a document intended to preserve the rights of the people by creating a government to do so. The US Constitution is not what governs the people, but what governs those who govern the people.

In a Democracy, one’s liberties can be mandated out of existence as happened to Socrates in Athens. Deemed a threat for his moral positions that might doesn’t make right, he was sentenced to death. On the other hand, even in an oligarchy as the ancient Rome Republic was, outspoken critics such as Cato and Cicero were not subject to the mob as was Socrates, although both eventually fell in harm’s way when that Republic fell with them; lessons learned….maybe.

What the Founders understood and wanted was to assure that liberty is not something government can exercise power over, but something it has no power to control. Much is often said about what the Founders intended, which at best is assumptive even though they left ample writings regarding this, but what is definitive is what the constitution says. There will always be interpretations, but the meaning of the words in the constitution is that of the time in which it was written, just as the meaning of the words of an amendment to the constitution is that of the time in which it was written.

The failure of the constitution to address slavery, a word that it didn’t even contain until 1865, was not only a moral failure on the part of the Founders, but created circumstances that nearly destroyed the Republic. That failure does not diminish its value as a protection of liberty, as it was for the Civil Rights Movement and remains so today.

Proposals that rights need to be “regulated” are presented as safeguards, when in fact they are a subterfuge to diminish rights; to propose such things is to expand power, but acceptance is an admission that the burden of liberty is too much to bear, the ultimate surrender of self. Such proposals are often incremental or peripheral, eroding liberty away over time and at the edges; unfortunately there are those that seem content to accept them like poisons that make them least sick, seldom questioning why they should take poison at all.

We often hear that in life we need to be prepared to compromise, to negotiate for an outcome that enables a mutually beneficial result. This is a valid practice in a transactional process such as business and in the settlement of civil disputes, but not regarding the rights of individuals, no matter how small a minority, and there’s no smaller a minority than the individual.

There is no guarantee in a Republic, no matter how clear and strong its constitutional foundation, against corruption. Often in political science we see comparative analyses between the US Republic and the Roman Republic. In some respects this is a valid thesis as the Roman Republic was also formed by a revolt against monarchy, had a written constitution, and a representative system of government. Unfortunately the US Republic has shown that it also has, like the Roman Republic, tendencies to oligarchy and ochlocracy, which have also led to a warfare and welfare state. We can only hope that the process will redirect away from the ultimate decent to totalitarianism as was the case with Rome.

There is another less known political phenomenon, not actually a system in the same sense as discussed above, but accurately descriptive called Kleptocracy, which is a government of corrupt leaders that use their power to exploit a nation’s people and resources for their personal wealth and political power. It’s closely allied with Democracy in that it can manipulate majority rule to this purpose. To do so with a Republic, you first need to insinuate Democracy into the fabric of a Republic’s institutions.

This corruption must come from within as this method is not overt as that would appear treasonous as if supporting a foreign agenda. It must also be incremental so as not to appear radical, and evolutionary as if it were a natural progression of development, replacing what is now deemed no longer valid or applicable to current circumstances.

In reality it is not that circumstances have changed so much as people’s perceptions, and they are easier to influence than the immutable principles of liberty. The slogans used to do so have varied over time, the current one being social justice, best described by Fredric Hayek as “The idea of social justice is that the state should treat different people unequally in order to make them equal.” Contrary to that is the idea of liberty in which true justice does not allow some people to have rights that are created by denying other people their rights, in essence the rule of law.

The US Judicial Branch of government as John Adams stated is a separate and independent institution, the guardians of liberty against any acts of the other branches contrary to the constitution; members take an oath, similar to all those in government to “…support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same;…” It is not an ambiguous oath, and it does not allow for interpretations as to what the constitution is but as it is. Regarding rights, thankfully the first ten amendments were added despite early objections as to their need based on the Constitution’s expressed powers. There was a sense of foresight in that based on the Founders’ experience with power and its tendency to corrupt, and their aversion to democracy’s tendency for mob rule over the rule of law.

It is clear from the construction of government under the constitution that the Founders did not find democracy accommodative to liberty, but a corruption to rule by the will of the people as a threat to liberty. Therefore, the government created was constrained or limited in its powers in order to best protect against violations of the rights of individuals.

With the growing emphasis on the popular vote, elections today appear more as a poll taken on policy than a process of representative selection. The principle of democracy suggests that collective decisions according to the will of the majority are now more relevant than the principles of liberty found in the constitution, which is the basis of our Republic.

The two major political parties in the US have abandoned the principles of our constitution in a dangerous polarization war for power. What we have as a choice in the upcoming election is Allende ala Biden versus Peron ala Trump, two versions of the same disease putting our Republic on life support, and providing the prognosis for a future with the lesser of two evils; essentially, pick your poison.

The Welfare State

The indebtedness of a nation is an impoverishment if its people, not a manifestation of justice.

“The state is the great fictitious entity by which everyone seeks to live at the expense of everyone else.” Frederic Bastiat, 19^th C French economist.

Every new law to create yet another entitlement is the result of some fabricated right at the expense of another’s rights. Rights are not a zero sum game, some transactional exercise, but are those things that define what it means to own oneself.

What is taking all of what someone produces with their own labor called? The answer is slavery. What do you call taking a portion of what someone produces with their own labor? Would that be proportional slavery? If you say no, you have a paradox; at what point is the proportion taken not slavery? Whether legalized by a dictator’s decree or a democratic mandate, taking reduces people to slavery, making them chattel of the state.

While no one overtly proposes slavery as a means to create welfare, there are those that propose taking the fruits of another’s labor in order to provide for the “common good”, an ambiguous term that reduces people to a collective entity that must be protected from, well themselves. This patronizing concept is another example of power lust, a twin to the Warfare State and just as insidious.

It does not matter what altruistic goal is proposed, the eventual outcome has always proven the same as over time the Welfare State will evolve into a dystopia we know as totalitarianism; this is the empirical lesson of history, and cloaking it in terms of invented rights will not prevent the conclusion. Taking under such disingenuous systems like Democratic Socialism is justified under the pretense that you have a say in the matter, which is a delusion and another case of democracy not being a safeguard for liberty.

Consider the popular platitude called “social justice” as a justification for the Welfare State. My concept of justice is that I keep what I earn, and you do the same; if that is not so, then how much of what I earn is yours, and why is that called justice? If taking the fruits of one’s labor without their consent is not theft, then it would follow that all thieves have to do is form a government to legalize it….wait a minute….OK, I get it.

Often the misconception of such rights evolves from the misunderstanding of opportunity; it is true for example that those born into a rich family have an advantage in opportunities, but that does not represent an injustice any more than a speedier runner in a track meet. No one who is blessed with an accident of birth in wealth or speed should ever be punished for their good fortune as such is luck in life. Likewise those that have had success in pursuing an opportunity are no less entitled to their rights than those that have failed; opportunity does not guarantee success, only risk.

These are seemingly axiomatic realities, yet they are dismissed by advocates for the Welfare State because they represent obstacles for the “common good”. Should you remind them that liberty includes the right to the pursuit of happiness, they will denounce you as selfish as that’s just another example of capitalist oppression. Should you counter with the argument that it’s the entrepreneur who takes the risk, creates the jobs, bears the costs of failure and if successful creates the wealth that grows the economy, you will be told that you are an outdated reactionary as that economic system is no longer functional because in government we have the means to grow the economy without the risk of failure. Should you point out to them that this has never worked, be prepared to be shouted down as an enemy of progress and equality. What caused this Bizzaro World of a new American culture?

The apparent enemy of this twisted phenomenon is liberty because it’s only a guarantee of equality before the law; in all other things liberty provides for each individual the right to exercise their free will. In truth that can result in a chaotic situation as there is no guarantee that people will choose what we may objectively judge to be the right choice for them, only that they are the only ones who have the right to choose what they judge to be in their own interests.

The alternative is to not allow them liberty and make their choices for them; the fact that this is the essence of slavery is lost in the pursuit of this equality in all things, creating rights for every aspect of life. To do this requires the force of law, and the enemies of liberty are united in that agenda; doing so ignores the fact that if force is required to promote your ideal, then there is an inherent and fatal flaw with that ideal as compulsion is not compassion, it’s authoritarianism.

It has been argued that the constitution mandates welfare based on its stated purpose. The reference made is actually in the preamble, which the Supreme Court correctly made clear is not an independent source of rights, and further that “general welfare” means the good of all citizens, and not an open-ended mandate for Congress, and that the only good that applies to all citizens is freedom, and that government’s proper role is the protection of that freedom.

So how then to fund the government for these protections of freedom without a taking of the fruits of one’s labor? As the Constitution actually forbade direct income taxes (except during crises such as the Civil War, but then suspended) prior to the 16^th Amendment, the US utilized tariffs, sales taxes, customs duties, excise taxes, land sales, and fees with which it managed to do so. Except in times of war, the US balanced its budget up to 1901, but ran in the red nearly every year since. The indebtedness of a nation is an impoverishment if its people, not a manifestation of justice.

The Warfare State

“…to get power you need a crisis…”

“Talk of imminent threat to our national security through the application of external force is pure nonsense. Indeed, it is a part of the general patterns of misguided policy that our country is now geared to an arms economy which was bred in an artificially induced psychosis of war hysteria and nurtured upon an incessant propaganda of fear. While such an economy may produce a sense of seeming prosperity for the moment, it rests on an illusionary foundation of complete unreliability and renders among our political leaders almost a greater fear of peace than is their fear of war.”

Can you guess the author of the above quote? While it’s insightful to know who said this, he would agree I’m sure that it’s more important to understand the message; to understand that we need to work backwards, starting with the phrase regarding the fear of peace. Why would anyone fear peace, especially the leaders of our country?

Power is the currency of politicians who are not exactly working to the benefit of their constituents but for their own advancement. For them, crisis is not a problem, it’s an opportunity. Rahm Emmanuel, Obama’s Chief-of-Staff, once advised “Never let a crisis go to waste.” Can you imagine in the absence of any crisis what such politicians would do? You don’t need imagination, just observation – they would create one.

This phenomenon is not something new; try the Spanish American War, followed soon thereafter by US entry into the Great War, which in effect was the cause of WWII, which led to the Korean War, then the Viet Nam War, then the Iraqi Wars, and the never ending Afghanistan War. Wars are expensive, so little wonder that Ron Paul once observed that “It is no coincidence that the century of total war coincided with the century of central banking.” If you’re politicians playing this bloody game, you need a big bank, and so the Federal Reserve is there for you.

The author of the opening quote was Five Star General Douglas McArthur, who served in all the above wars through to and including the Korean War. He was one of only five generals to ever rise to the rank of General of the Army, clearly a man we can rely on to know what he’s talking about.

So how did a republic devolve into a statist organism capable of manipulating such a carefully crafted balance of power, designed to prevent the realization of such a distorted vision of purpose from peaceful productivity to a war machine? It was an evolutionary process, so it did take time. It can be argued that the root of this evil was sown in the immoral neglect allowing slavery to continue despite our revolution against tyranny, eventually leading to the ultimate crisis of the Civil War, out of which ashes emerged a different nation whose political structure was tragically altered toward more centralized power, ironically the key development for statism to repress the very liberty for which the war was fought.

In his famous 1952 article entitled “The Rise of Empire” Garet Garrett, American journalist, outlined what he called the “Hallmarks of Empire”, summarized as the dominance of executive power, subordination of domestic policy to foreign policy, ascendancy of the military, development of foreign satellite or proxy regimes, and vaunting and fear.

While the above have become obvious in our current politics it is the last that illustrates the tragic end game of The Warfare State. It’s about a nation whose leaders spun and sold the illusion of a manifest destiny but now finds itself a victim of its own misguided policy, having become the world’s policeman at the expense of its own liberty, security and economic wellbeing.

While it was not inevitable that our Republic would descend into imperialism, it is obvious that it has. Until Americans realize that Statism thrives on war, whereas a truly free country thrives on peace and prosperity, we are doomed to endless wars. These wars are sold to us like Crusades where sold to Christian Europe to free the Holy Land, when in fact it was all about looting and pillage; now it’s really about things like oil, preservation of the dollar as the world’s reserve currency, spreading democracy, throw in an occasional humanitarian cause, nation building, catering to despotic allies…….any interventionist cause and fabricated crisis that provides the opportunity to grab more power.

Interventionism is bred into both of our major political parties although their methods at times differ as some work toward the Welfare State to harvest their power, a topic for another post; regardless of their labels and methods these politicians are the same, so to get power you need a crisis, and if there isn’t one create it, if there is one don’t let it go to waste.

If that sounds like gang talk, well it is; listen to a Polish lawyer, author, and political philosopher who went through the pain of living under such a gang and working for the liberation from one of the biggest imperial powers in Europe known as the USSR. “What makes the difference between a gang and a state is the belief that there is a difference between a gang and a state.” Jakub Bożydar Wiśniewski

Like Manna From Heaven

Manna is an illusion, and like all illusions it passes with time.

Manna, depending on one’s beliefs was either a biblical event, or a metaphor about God providing sustenance for the Israelites in their time of need. Today we’ve all heard the term helicopter money, a metaphor about money seemingly dropped from above, falling as if it’s Manna from Heaven.

The reality is a bit more sobering. The most useful tool for the Feds and the UST was actually invented about 570 years ago; it’s called the printing press. It was not thought of as a magical tool to create money, but one to better disseminate knowledge, which shows you how dishonest governments can be, like drug addicts pretending they don’t have an addiction.

There are many measures and definitions of the “money supply”, and they differ in some respects among economists and from country to country, but we will use the following for simplicity and clarity in what we are measuring and comparing.

MB, the monetary base, is equivalent to the actual sum of currency held by the US Treasury and the Federal Reserve as defined by all banks and other depository institutions in their accounts at the Federal Reserve.

M0 is equivalent to the coins and paper currency held by the public, i.e. outside of the US Treasury, the Federal Reserve banks and the vaults of depository institutions, in circulation plus any deposits which can be converted into cash.

M1 is equivalent to M0 plus checkable or demand and other deposits of the public held at commercial banks, savings and loans associations, savings banks, credit unions and similar items like traveler’s checks.

M2 is equivalent to M1 plus money market funds and deposits, certificates of deposit and other time deposits, but excludes long-term deposits like retirement accounts.

M3 is equivalent to M2 plus long-term deposits like retirement accounts.

As you may imagine, much of this money in the broader supply categories is not actually physical, but virtual as in digital form. Given that all currencies in the world are now “fiat”, i.e. money by decree, you get one layer of imaginary money on top of another; that’s another topic to be addressed separately. For now let’s just keep it simple and compare the MB and the M1 over the short period of December 2019 to July 2020.

In December 2019, the MB was $3.40T, where as in July 2020 it’s $4.70T, a 38% increase. In December 2019, the M1 was $3.98T, where as in July 2020 it’s $5.33T, a 34% increase. Please note that these amounts are staggeringly higher than just a decade before, so those printing presses were really working hard!

Are we fooled into thinking that the “public” as noted in the M1 definition was suddenly blessed with a magical 34% increase in wealth? Nice try, but we can’t be that dumb….can we?

While manna maybe a literary anachronism, there are people that sincerely believe this bloated monetary policy is something necessary to provide the American people sustenance in a time of need. After all, isn’t that what we hear from our politicians, corporate leaders, financial gurus, so called economic experts and the bobble head media? Yes, for the most part sadly it is, but therein is the problem because while it may be a quick fix for debt addiction, it’s a sure way to impoverish a nation in the long run, only now the long run is getting closer by the millions. As of this month, the debt of the US exceeds its GDP, and will likely grow ever more beyond that; obviously that can’t be sustainable.

Critics have rightfully expressed concern that this policy of monetizing debt is a fool’s game, one that has never worked as empirically evident historically and in current times; it only perpetuates but does not solve the problem anymore than a drug addict ignoring the fact that the end game will be far worse than the pain of kicking the habit.

Don’t expect the critics to have any impression on either major political party; they are both intent on buying votes with more printing press stupidity, intoxicated with the cheap liquor of fake money; apparently the only thing they learn from history is how to avoid learning anything from history.

So then what is the solution? There’s no denying that it would be painful, froth with severe withdrawal symptoms. Shrinking the money supply will tighten credit, raising interest rates, as it did under Volker a few decades ago. There will be bankruptcies as the zombie companies and over indebted individuals face insolvency. Governments will need to become fiscally responsible, balancing budgets as their source of funds is reduced to taxation, a politically toxic alternative, not to mention economically counterproductive to recovery.

Which brings us to the ultimate natural control mechanism for preventing the Fed and the UST doing the same thing all over again assuming the above solution is engaged, i.e. a monetary standard, whether gold or some equivalent. Along with that, we need to shut down the Fed; it has been nothing more than a tool for the cronyism of government and business, particularly Wall Street, creating ever more inequality economically, the enemy of a true free market.

I can hear the snickers of the elitist power brokers in our moribund institutions dismissing such radical ideas as impractical or outdated; what they may or may not realize is that if it doesn’t happen the old fashion way, there is an alternative that will happen anyway as the world has come to accept cryptocurrencies. It’s just a matter of time before this technological revolution of digital gold, which like its physical twin can’t be manipulated, will dump fiat currencies on the trash heap of counterfeit money.

Manna is an illusion, and like all illusions it passes with time.

# LikeMannaFromHeaven

Silence of the Damned

With so much protests going on about us, why is there relative silence about the suppression of free speech? Such silence will surely damn America like a cancer causing the destruction of our cultural and social values. As Mark Twain said “The truth hurts but silence kills.”

What is it about Edward Snowden that scares the NSA so much? After all, what he released seven years ago is already in the public domain, and much of it disclosed what should be deemed illegal activities by that organization to begin with. He was a true whistle blower, and the American people should embrace him as a hero, not a traitor. His actions were a protest against our government’s obscene surveillance and invasions of privacy of Americans. I think exposing that scares those that are up to no good.

Amazingly Trump is considering pardoning Snowden. That is likely motivation due to his feud with the intelligence community regarding his dealings with Russia and the Ukraine, but you take whatever good comes along and pardoning Snowden would be a good thing.

Snowden had supporters in Congress, such as Ron Paul, who stated “My understanding is that espionage means giving secret or classified information to the enemy. Since Snowden shared information with the American people, his indictment for espionage could reveal, or confirm, that the US Government views you and me as the enemy.” That’s a chilling insight we need to seriously consider.

Snowden was charged under, among other statutes, the Espionage Act of 1917. That was a shameful law that was meant to silence protest about the US entry into the Great War; the most shameful episode was the acquiescence of the Supreme Court in Schenck v. United States. Schenck was protesting through the distribution of pamphlets, the same publication medium as Thomas Paine’s Common Sense during the American Revolution. The Courts twisted logic in finding against Schenck was a repudiation of free speech if there ever was one. We currently face a tsunami of forces against free speech.

Politically we face the likely revision to Section 230 of the Communications Decency Act. Oddly enough the original purpose of that legislation was to restrict free speech on the internet that was deemed “obscene”, but it also included this section which protected social media as an open public platform against law suits about what someone may publish that anyone found offensive. Now both Democrats and Republicans want to change that as they seek to silence free voices that may criticize them.

Academically there’s the very troubling phenomenon on college campuses where opinions expressed by students and faculty that fellow students and teachers find offensive often results in censorship, suspension, firing and expulsion. How can institutions of higher learning not support free expression, the very essence of intellectual development?

Socially, we are not doing much better. Consider for a moment the Antifa movement, which openly espouses that the very concept of free speech is a tool of “liberal” suppression. The term liberal here does not refer to a political spectrum of modern politics but that of the Enlightenment. That the acronym Antifa stands for Anti-Fascism is another Bizzaro World reversal of our times. Also be aware of the “woke” movement which seeks to suppress any free expression that someone finds “threatening”; well there’s a slippery slope that can’t lead to anything good.

The mass media has not been very helpful here; they are supposed to represent an essential element of democracy as a free press but in fact have deteriorated into political advocacy contrary to objective journalism. This failure aids in polarization and provides an open door for interference from bad actors like Russian and Chinese agents. The effectiveness of those actions increases in the absence of reliable information.

Soon we will see political debates as a lead up to the 2020 elections. It’s troubling that both major parties are actively working to prevent the inclusion of third party candidates, even initiating law suits in that effort. This is not an encouraging development in support of free speech. Americans have a right to hear from all those seeking public office and a true democratic process requires an informed electorate.

Regardless of your political position, keep in mind that free of speech is the foundation of liberty which provides you with the right to even have a political position. A lack of support for free speech is a silence that will damn that right to an empty phrase.

Panicdemic

It’s been a while since I last posted on my blog, but it has been time well spent catching up on so many things I should have done well before the pandemic, as I’m sure is the same for many of you.

I hope you are all doing well, and that includes not panicking over COVID19; the real pandemic that it causes is stress. As my long time doctor has told me, the ultimate cause of poor health long term is stress.

While I don’t believe our administration for a moment regarding this pandemic, I find all those that are indulging in panic, especially the talking heads in politics and the media, to be irresponsible, causing undue stress.

We need to keep our eye on the long run, an aide to which is a look back in history. Consider a century ago when the worst pandemic of modern times, known as the Spanish Flu, hit the world just as the Great War came to an end – timing is everything.

The world population at that time was about 1.8B. Total cases are estimated at about 500M, and deaths at about 50M. This provides some perspective given an infection rate of 27.7% and a mortality rate of 10% of cases, equivalent to 2.7% of the world population; staggering statistics.

Not to minimize COVID19, but comparatively we currently have a world population of 7.8B; as of today total infections are at 14.3M, and deaths at 603K. That’s an infection rate of .18%, and a mortality rate of 4.3% of cases, equivalent to .0077% of the world population. This mortality rate is close to SARS, while MERS was a staggering 34.4%.

While we can contribute the lower rates to better disease protocols, clearly COVID19 is the lesser of the modern era viral epidemics; here are some things to consider that fed in to this panic:

Much of the early market sell-off came from large institutional investors like pensions, hedge funds, and investment banks, which represent the majority of investment and employ algorithmic trading platforms that automatically move with headline news. We saw this before with MERS and SARS, two earlier Coronas, but not to this extent; that the media creates headlines that can cause such panic was clear.
It didn’t help that the FED cut rates drastically as that only added to the panic. Besides, I doubt interest rate cuts cure diseases, has not really helped economically except to keep Zombie companies afloat a little longer, lower debt service for the Federal Government, and feeds Wall Street frenzies, but this definitely hits fixed incomes really hard and does little for the average American worker.
Stimulus programs sound good, but only work short term and ultimately cause capital dislocations away from productivity; the long results will definitely cause panic.
The Fed’s practice of monetizing debt will only extend the recovery period as it did with QE in the 2008 Financial Crisis; professing an “all-in” policy is actually a sign of panic, essentially admitting that all you can do is react to whatever comes about, which is no policy at all.
It only adds to the panic to hear people discount concerns based on false and irrelevant information in the face of simple statistical evidence. When Trump said that he didn’t know that people could die from a virus, it was very disconcerting to find out his own grandfather did! This kind of stuff from the leadership level does not instill confidence.
Medical experts and history tell us that COVID19, which is particularly contagious, will spread out everywhere, which is true, it’s what viruses do, so I have little faith in containment plans; they may help “flatten the curve” in the short term, but ultimately this virus will run its course.
What we need is testing, which not only provides reliable statistical information, but critical analyses and medical protocols for treatments and to help develop a vaccine. Would you believe that with all their hype the media failed to report what MIT published, i.e. that the FDA had initially disallowed local laboratories to conduct testing and required specimens to be sent to the CDC? Finally under intense congressional pressure with the release of MIT’s report the FDA relented on February 29th and changed this policy. What was the FDA thinking getting in the way of medical science? Dumb question right, it’s what they do.
The predictions by experts of millions of Americans dying from COVID19 caused some states to lockdown businesses, depriving many from livelihoods without which they could not live; such panic mongering is even more lethal than the virus itself, but why do we not hear more about the gross miscalculations?
The hyperbole about vaccine development is causing both euphoria and panic; we need a measured analysis for some clarity on this critical issue.

The list goes on, but I will follow what my doctor of 40 years told me – keep clean, keep good health habits, follow hygienic protocols and don’t panic as that creates stress that will definitely make you sick…..and live your life.

And from my financial advisor, don’t look at your retirement plans for about a year, that will definitely stress you out.