Some thoughts on our current economic situation.

The actions of the Obama administration, and the last gasp of the Bush administration, have resulted in potentially irreversible damage to the status and value of the US dollar. Even if the amount of cash released wasn't really that significant (and I think it was), by demonstrating that our government is willing to devalue the currency, we have ruined the confidence the dollar once enjoyed. Banks around the world are seriously considering, if not already switching, changing their reserves over to other currencies or gold. When doing so they sell their dollars, which will further exacerbate the lack of confidence.

The exact effects of this inflation may be more difficult to plot, thanks to the majority of this money being trapped outside the country, a condition that is largely their own fault: What will they buy with those dollars? Our production capacity has fallen drastically, with most production happening overseas. What's left is meant for the US market and is largely unsuitable for export, with a lot of effort required for conversion. The service industry isn't readily exportable. Automobiles? Don't make me laugh. Real estate? Foreign investors already own large amounts of US real estate; and that real estate rents for MORE DOLLARS, just what they need. Wheat? What, MORE wheat? Much of the rest of US food production is in perishables which aren't readily exportable.

Domestic inflation is more closely tied to oil prices, what with our use of petroleum for fuel, fertilizer and plastic. Oil producers are stuck; they've pushed prices as high as they could without sharply curtailing demand, and even if the dollars aren't very desirable, they'd rather have that cash than nothing. In this sense we're better off than when OPEC was boycotting the US and reducing supply during the Carter administration, which caused that high inflation here in the US.

In my opinion, what we will see is a devaluation of the US dollar with regard to foreign currencies, inflation in everything except base foodstuffs, and reduced imports. Long-term effects will possibly see more domestic manufacturing, which is good, but will also see some of our food production shift to exportables. The US was a rich country, richness being a measure of experience; we will be poorer in the years to come.

Rush Limbaugh says, "those darkies need to go back to Africa where they belong!"

;-)

I just watched a recent speech by Noam Chomsky, and I must say I've lost some respect for the man. I'd always considered him an interesting person, even if we didn't see eye to eye. He seems to have departed from his anarchistic basis, though; instead, he seems to have taken up the opinion that "big government is okay, so long as it's my big government.

I suppose that's the endpoint of anarcho-syndicalism. My syndicate is best and should rule.

I did agree with a few things he said; the United States government is putting a lot of support into spurious plans. It lends much towards corporations which are happy to take the profit but would rather have taxpayers take the loss. Can't complain there; the government should never prop up an organization at the expense of the people.

One riff that truly surprised me was his complaint about companies that prematurely repaid TARP funds. His point was that it reduced the funds available for making loans, and that it allowed those companies to pay out monies to their executives. (1) There's plenty of money available to loan out, if it weren't interest rates would be higher. (2) Easy access to loans is what caused the crisis in the first place, something he complained about earlier stating that we were going back to the same pattern, and complained again later about companies entrapping people in a web of debt. (3) So government shouldn't be allowed to prop up companies but should be allowed to interfere with their operations?

Another complaint was about his "lack of choice" in transportation options. He says he can choose between Ford and Toyota, for example; but he can't choose between Ford and taking a subway, that it's not an economic option but a social option. What?? Put a subway on the table and you remove the choice; everyone winds up subsidizing the subway through tax money, both in construction and in operation. If it were a valid economic choice then people would be building their own mass transit systems. Further, the government limits private mass transit; just try starting a private bus service and watch the fur fly!

Something else I have to take issue with was his whole-hearted adoption of the global warming meme. He cites a MIT climate model and then worries they may not have included some potential positive feedback mechanisms. (1) What about potential negative feedback mechanisms? (2) What about the recent evidence of solar-driven climate shifts that can swamp any human-based global warming?

(3) Based on the above and other evidence, why am I worried he is taking positions to reinforce his entire meme structure rather than for logical reasons?

The last item I must take issue with was his analysis of the origins of the United States government. He dwelled on the idea of the government being controlled by the elite, in the form of the Senate, and how the elite needed to be protected from the hoi polloi. (1) The government was supposed to be limited by the Senate, one of three parts of the triumverate of the Federal government; why is someone who is supposed to be a minarchist complaining about limiting government? (2) Yes, the founding fathers were concerned about pure democracy, seeing how well it worked in Greece. (3) The composition of the Senate was altered by Constitutional amendment in 1912, changing its membership from being appointed by State governments to being popularly elected, making it mirror the House of Representatives and reducing its effect in being a limit on the Federal government, something I consider to be a major factor in the decline of this nation.

(4) The masses should not be allowed to pull down the elite, any more than the elite should be allowed to exploit the masses via governmental manipulation. Chomsky is fixated on the haves versus the have-nots. He may have a point about our current elite unfairly benefiting from the government, but he has lost his focus on the government being the cause of the problem. Rather than individuals gaining elite status via good work and good ideas, it is becoming more and more difficult for individual innovators to gain money and status. Government has slanted the playing field to favor megacorporations and big box stores over small proprietors. So yes, in my opinion the elite do deserve protection from the hoi polloi; it's protection from themselves, and unfair benefits from government, that should be done away with.

Oh. My. God.

http://www.infowars.com/conyers-sees-no-point-in-members-reading-1000-page-health-care-bill/

"I love these members, they get up and say, ‘Read the bill,’” said the Chairman of the House Judiciary Committee, Democratic Congressman John Conyers (D-MI). “What good is reading the bill if it’s a thousand pages and you don’t have two days and two lawyers to find out what it means after you read the bill?”

Um. If there's no way for you to understand what the hell is in the bill, then WHY ARE YOU VOTING FOR IT?

Some inter-related news:


World Bank warns of deflation spiral

The World Bank has given warning that global economy will fall into a "deflationary spiral" unless urgent action is taken to reduce high levels of excess capacity in industry.

So we need to close down industries... Which will put people out of work... Which means they won't be buying goods... Which means we have excess capacity again.


Joe Biden: ‘We Have to Go Spend Money to Keep From Going Bankrupt’

...Unless the Democrat-supported health care plan becomes law the nation will go bankrupt and that the only way to avoid that fate is for the government to spend more money.

Not sure I even have to comment on this one.


The Long-Term Budget Outlook, from the Congressional Budget Office


Basically, if we keep going as we have been, thanks to Medicare, Medicaid and Social Security, government spending will reach 100% of GDP in an amazingly short amount of time.


This would be hilarious, if these idiots weren't in charge of the world. I wouldn't trust them with a credit card, much less our economy.

ARE YOU A SUBVERSIVE?

Beware, any indication that you are a right-wing radical may lead to your being investigated and hassled. One gentleman was detained by Louisiana police for a half-hour while police ran his ID, looking for any excuse to hold him. His offense? A "don't tread on me" bumper sticker.

The DHS's broad accusation seemed silly to me, until this came up...

Raw Video: Conn. Officer Beats Suspect

Apparently, "stop resisting!" is similar to "it's coming right for us!"

Here's one good example showing why firearms shouldn't be banned...



In fact, it's a good example for why "assault weapons" shouldn't be banned.