Obama's stealth government

Once America became The Administrative State, the danger has always been that the country is, or can be, run by hidden bureaucrats appointed to their positions without vetting by voters or Congress.  Welcome to the Obama administration and the faceless Czars and Czarinas appointed to head the many commissions, committees, et. al. responsible for interpreting laws passed by Congress and churning out the rules and regulations that everyone then has to live by.  Obama, as per this article, has taken the administrative state concept to a new level with the appointment of all the far left lawyers like Cass Sustein, Eric Holder, et. al, to positions of power and unaccountability in what used to be our Republic.  This course of action by democrat presidents should never come as a surprise as they have been engaged in this stealth governing since FDR, some simply with more gusto than others.  Hopefully the next Republican President can reverse this outrageous government takeover and return the country to its roots as a Constitutional Republic, accountable to the sovereign people.

Huerto de Soto on fractional banking

This Youtube interview interview of Huerto de Soto, a leading Austrian economics school economist from Spain.explains quite clearly the role of central banks and fractional banking in the creation of booms and busts in the world economy these days.  His accent is heavy but his explanation is quite lucid and worth listening to.

Corzine the liar

Observing Jon Corzine's career as head of the largest Wall Street stock and bond house and gig as a liberal governor of New Jersey and back to the private sector as CEO of a large brokerage house, and the as a witness before a Congressional committee looking into his company's loss of over a billion dollars of clients money, on has to wonder, where in God's name do these people come from?

Unfair analysis by Robert Samuelson

This analysis of the impending crackup of our political "solution" to the economic dilemma now facing the nation does little to offer any reason for optimism about a reasonable outcome in the future.  Samuelson, a reporter on economics for many years, seems to try very hard to place blame for the impasse equally among democrats and republicans without addressing the significance of the underlying causes.  A quote:

The budget impasse raises comparable questions. Can we resolve it before some ill-defined crisis imposes its own terms? For years, there has been a "something for nothing" aspect to our politics. More people became dependent on government. From 1960 to 2010, the share of federal spending going for "payments to individuals" (Social Security, food stamps, Medicare and the like) climbed from 26 percent to 66 percent. Meanwhile, the tax burden barely budged. In 1960, federal taxes were 17.8 percent of national income (gross domestic product). In 2007, they were 18.5 percent of GDP.

This good fortune reflected falling military spending -- from 52 percent of federal outlays in 1960 to 20 percent today -- and solid economic growth that produced ample tax revenues. Generally modest budget deficits bridged any gap. But now this favorable arithmetic has collapsed under the weight of slower economic growth (even after a recovery from the recession), an aging population (increasing the number of recipients) and high health costs (already 26 percent of federal spending). Present and prospective deficits are gargantuan.

Samuelson's static comparative analysis of the economy since 1960 to present fails to mention the growth of the welfare state and the consequent devotion of economic resources to satisfy that growth. While the tax burden as a percentage of the GDP may indeed have barely grown since 1960, personal incomes have probably doubled or more in constant dollars since that starting point meaning the government burden on the economy is much greater now than then.  Furthermore there was no Medicare, EPA, Departments of Energy, Education, et al, commanding tax resources but more importantly creating thousands upon thousands of regulations the hidden costs of which easily match the direct tax burden on the economy.

Samuelson's equal blame allocation to both parties is also less than accurate:

Liberals still want more spending, conservatives more tax cuts. (Although the tax burden has stayed steady, various "cuts" have offset projected increases and shifted the burden.) With a few exceptions, Democrats and Republicans haven't embraced detailed take away policies to reconcile Americans' appetite for government benefits with their distaste for taxes. President Obama has provided no leadership. Aside from Rep. Paul Ryan, chairman of the House Budget Committee, few Republicans have.

Au contraire, republicans have proposed many plans to limit the size and growth of government for many years including wholesale elimination of wasteful and useless departments, revision of the tax code to promote economic growth, and others.  Meanwhile democrats have blocked all these efforts and promoted other plans such as the CRA which have led directly to the crises we now face.  Placing blame on both parties is fair up to a point, but on net, republicans have offered many plans for restraining government growth and beyond that of Paul Ryan's aimed largely at the train wreck called Obamacare.

More on Freddie and Fannie

The outrageous scam perpetrated by the GSEs has predictably become a blame game, finger pointing typical Washington big government indictment.  Unsurprisingly Nan Pelosi has her footprints all over the history rewrite that has been going on in an attempt to deflect responsibility from the political class to the Wall Street bankers.  This article in the WSJ catches this unscrupulous politician in the act:

The SEC's case should embarrass Congress's Financial Crisis Inquiry Commission, which spent 18 months looking at the evidence and issued a report in January 2011 that whitewashed Fan and Fred's role. Speaker Nancy Pelosi created the commission to prosecute the Beltway theory of the crisis that private bankers caused it all, and Chairman Phil Angelides delivered what she wanted.

Wall Street's runaway greed which resulted in balance sheet leverage of up to 50 to one surely deserves some of the blame for the debacle, however the major fault lies with the politicians (Carter Administration) who created the CRA back in the '70's. and those who hyped it later on (Clinton Administration with a little contribution by Bush Administration) and the nefarious managers at the GSEs who hid and multiplied the risks to the point the program was bound to fail.  Hopefully as this article suggests this case will go to trial which would give everyone the opportunity to focus on the real culprits.  At the very least his example of political intervention in the economy should become a central issue in the upcoming presidential campaign.  However since the Republicans' hands are at least soiled, chances are this important issue will not be raised.  Meanwhile the depression will continue until all the toxic paper clogging up the credit machine is finally written off.  The Austrian economics school economists predicted all of this but of course have never been listened to for fear their philosophy would end the drunken party.  Jim Whelpley also saw this coming but, unfortunately or fortunately, did not live to see the chaos it caused.

Required reading for sane Obama voters

For all those friends who for some inexplicable reasons voted for The One,  this should be required reading.  When from the vantage point of 10 or 15 or 50 years the history of the Obama administration is written (by an objective historian/reporter, of course) there will be general disbelief that it could have happened in this country.  There will also be general disgust by those who allowed themselves to be hoodwinked by a fraud without a documented past,  whose supporters and connections were all anti America, anti Capitalism, anti Constitution, interested only in changing our traditions and way of life.  It will be seen as the darkest period in our history since the Civil War.

Protestantism's weak link

For many years now mainstream Protestant sects, e.g., Episcopal, Methodist, Presbyterian, Baptist, Lutheran, et al, have been losing communicants while Evangelical sects have been growing. There are no doubt many and complicated reasons for this development;  however,  at least one obvious explanation lies in thinking of the current Archbishop of Canterbury, Rowan Williams, who as the head of the Church of England putatively speaks as the religious voice of the state of England and its worldwide offshoot, the Episcopal Church.  Williams embodies the secular and politically correct "social justice" philosophy reflected in the leftist politics of Barak Obama and his minions.  Briefly this philosophy is anti the values embodied in the American Constitutional, anti the concept of American exceptionalism,  anti-Western values in general, specifically Capitalism's embrace of the importance of self interest, private property rights, competition, and all the rest that goes with an economic system that has raised millions of people out of poverty over the last two hundred years.  Communitarians like Williams and Obama want  an economic system that produces equal outcomes and a society in which all group political and religious rights and values are accepted and respected equally.  The only real difference between the Obama-Williams and communist philosophies is the acceptance of a role by religion by the former.  Of course those religions must embrace the relativism and social justice values inherent in communism to be acceptable. Clearly the protestantism of shared values with Capitalism, to wit: the importance and significance of the individual person and the attendant values of  hard work, self discipline, competitive spirit, individual good works, and the like, has given way in the Obama-Williams world to a group rights, non competitive cooperative feel good, equality above all else, Protestantism.  Roger Kimball provides some interesting insights into the thinking of Rowan Williams here.