In The Bubble of Stupidity

The brilliant and colourful English Lit professor and occasional philosopher Marshall McLuhan presciently wrote, “Politics will eventually be replaced by imagery. The Politician will be only too happy to abdicate in favour of his image, because the image will be much more powerful than he could ever be.”

 McLuhan passed away in December of 1980, yet he seems to have had the capacity to perceive so many vacuous celebrity politicians which today fill our electoral landscape – empty vessels which float to re-election on electoral carpets of wishful thinking and ignorance. With an uninquisitive media abstaining from accurate reporting, the misinformed public remains in the dark.

No-where is that ignorance of “imagery” politicians in more glorious display than on all matters economic. Politicians may not hold forth on brain surgery or Mars landings, but they certainly expound profusely on the economy and its forces.  This week we were treated to a rather typical display of incomprehensible idiocy by none other than a Ranking Member of the House Financial Services Committee. Perhaps we should underline “Financial Services Committee.”

Congresswoman Maxine Waters made the following statement,“Yesterday we did have Mr. Bernanke in our committee and he came to tell us what he’s doing with quantitative easing and that is trying to stimulate the economy with the bond purchases that he’s been doing because he’s trying to keep the interest rates low and create jobs–and he said that if sequestration takes place, that’s going to be a great setback. We don’t need to be having something like sequestration that’s going to cause these jobs losses, over 170 million jobs that could be lost–and so he made it very clear he’s not opposed to cuts but cuts must be done over a long period of time and in a very planned way rather than this blunt cutting that will be done by sequestration. . . . . And so, we are here today, one more time, talking about women and children and families and how we can protect our women, children, and families and have a decent quality of life–sequestration will set us back. All of the gains that we have made will be lost with sequestration.”

So there you have it from very near the top of the Nation’s political hierarchy – a statement providing clear insight into the frightening lack of comprehension with which the country’s financial affairs are supervised.  Let’s ignore the absurd claim, “170 million jobs that could be lost,” since there are only 141,614,000 jobs as of January 2013 in total – and well, anyone can make a mistake when making a supposedly critical statement to the Nation. No?

Of greater import is Waters’ description and characterization of Bernanke’s presentation to her Committee?  Does she, or any other member of her Committee understand enough of what Bernanke is doing, or why?  She states,  “he came to tell us what he’s doing with quantitative easing and that is trying to stimulate the economy with the bond purchases that he’s been doing because he’s trying to keep the interest rates low and create jobs.”  Huh?  Does anyone ask her how her brain connects all those dots? That would be embarrassing, since the dots don’t connect.   They don’t and they can’t.  Did anyone on her committee ask Bernanke to connect those dots?

Her statement demonstrates that this “imagery” politician is lost and baffled by economic matters and realities, but she is evidently confident of achieving a successful outcome for herself through the spewing of unintelligible gibberish as long as it is followed by a comment about the sky falling on single women and children.  Pretend to somehow be protecting single women and children, which is even better than championing motherhood and apple pies, and Walters succeeds in propping her own statue another day.

Waters is simply another fear-mongering politician ignorant of the fact that the Fiscal Cliff is only reducing some of the planned increases in discretionary spending.  Almost nothing will be cut from mandatory entitlement programs – Social Security, and Medicare, or from debt interest payments.  The Nation’s financial problems rests primarily on mandatory expenditures and their looming explosion.  Should someone point that out?

With the quality of economic acuity we are subject to, as demonstrated by politicians of the Waters caliber, it is hardly surprising that nothing is being done to bring spending and debt under control.  Nothing is being done to restrain the excessive growth of government.  The complexity is too difficult for uninformed and uncreative minds of the “imagery” politicians to confront. It is so much easier to ignore a complicated reality, particularly when doing so might throw shadows on their ideology.

Let's take another prod from Marshall McLuhan’s stimulative mind, in which he prophetically defined mindsets of the current leadership in Washington, “I wouldn’t have seen it if I hadn’t believed it.”

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A Critical Turning Point In American History

We progress, marching forward leaving behind us a trail of yesterdays, filled with events large and small, assembling memories, but some of the more momentous occurrences rise to a superior level which we include in our collective “history.” In that wake of our advance some of those momentous waves swell further, rising to become events that only hindsight can identify as pivotal moments in that shared recollection.

Such hindsight is not always 20/20. We may be aware of the events as they unfold, but their significance and impact on our march forward is not always self evident and years may pass before they become so. Self-serving motivations too often imbue the retrospective lenses with prisms which deliver infinite varieties of perspectives. 

For over four years we have been instructed by those supposedly most knowledgeable and most insightful, occupying positions of leadership advancing society forward beyond the now and into the great unknown, that a new and magically wondrous elixir named “QE” would be the salve to all anxieties. It matters little that QE stands for Quantitative Easing, and may as well conjure up notions of a long-reigning monarch, since its true long-term consequences appear beyond our collective comprehension. Nevertheless, its impact is not as benign as one queen’s influence on ‘her people’. With minimal scrutiny or analysis by most of our media, but with the unrestrained approval of Congress and the Administration, The Federal Reserve proceeds with its unrestrained expansionary monetary policy. It pretends that this is good medicine for a Nation yearning for a return to economic growth, unaware that a printing press, while capable of printing unlimited dollars, cannot print a single job. It also pretends that its expansionary fiscal policy is enabling the hoped-for purchase of homes and cars. It pretends that low interests rates render the escalating debt load inconsequential. The reality is very different.

QE, QE1, QE2, QE3, and QE4 ad infinitum, indulge the Federal government’s insatiable expectations of unrestrained spending. The Fed will continue to buy up billions in Treasuries and Mortgage Backed Securities from member banks well into the future (on your behalf – and remember that those major too-big-to-fail banks are still burdened with toxic debt). The Fed’s actions will also enable Tim Geithner to sustain his schemes for financing friends of the Administration such as he did the unions in the GM bailout, or the brilliantly invested hundreds of millions in Solyndra.

The QE program is to continue until unemployment falls below 6.5%, or inflation rises above 2.5%, and the interest rate of 0% will be held until at least 2015. Other than those who watch their savings shrink each month, does anyone care? Not Congress, certainly. We may have structurally experienced the boiling frog metaphor.

The mandate of The Fed is supposedly to support job creation and to keep inflation in check. It pretends to be concerned with inflation while creating truckloads of debt. How is this not going to produce run-away inflation in the long-term? It can be argued that real inflation has been running at well above the government published 2% – your own cost of all goods will provide some indication. Additionally, 0% interest has not and will not launch a rush to banks for loans. 0% interest is, however, rewarding The Fed’s friends with the cheapest money they’ve ever had access to, enabling them to make money without risk – enabling never before seen executive bonuses. This action by Ben Bernanke in fact works against new or riskier businesses looking for loans from their local B. of A. or Wells Fargo bank managers.

‘Liquidity’ is not the barrier preventing the creation of jobs by corporate America, large or small. What else do we know?

•  We know that larger corporations are refraining from investing in capital goods and are only tepidly bankrolling increased productivity.
•  We know that most of the bank reserve increases since 2008 are sitting idly on the sidelines, as is a vast amount of corporate cash.
•  We know that current unemployment is ‘structural unemployment,’ which could mature into a long-term malignant disorder. 
•  We know that new dollars created without the ‘backing’ of relative increases in economic activity (gold was once used as backing), places excessive downward pressure on the value of all dollars. 
•  We know that one major constraint to job growth is the current lack of confidence, and that uncertainty can be diminished, even eradicated, with energized leadership. 
•  We know that unrestrained government spending stimulates very little confidence, and fear expands to fill that void, stifling ‘job creation’ by companies afraid to stray from the secure status quo. 
•  We know that The Fed’s activities have resulted in relative decreases in the dollar’s purchasing power manifested in our increased prices for staples such as gasoline and food, and for those who can afford to, the purchase of gold. As recently as late 2008 you could purchase an ounce of gold for under $1,000. Today that ounce costs between $1,650 and $1,700. 
•  We know that The Fed actions have aggressively replaced personal ‘interest income’ with ‘dividend income’ since 2008. 
•  We know that rates of inflation have been understated by the Federal Government, just as the rates of unemployment have been understated. 
•  We know that Congress will not cut back on expenditures and we know that the current Administration is steadfast in its advance of more spending. 
•  We know that the unfunded future liabilities of Social Security and Medicare present a financial challenge far greater than the current total National debt. 
•  We know that The Fed has independent control of the printing presses and provided the  Washington Treasury with seemingly unrestrained amounts of magic cash (read ‘ability to spend’) through debt loaded onto the backs of all taxpayers, while at the same time restraining and suppressing the economy. 
•  We know that most of the political establishment in Washington has been unable to resist the temptations driven by self-interest and is willingly, and knowingly acceding to overindulgent debt financing. 
We know, but are we in denial?

Are we pretending and rationalizing those nasty gremlins away by convincing ourselves that the all-knowing elected leaders, their appointees and their friendly neighborhood banking masterminds will solve our worse problems?  Are we convinced that the Washington centers of influence will somehow coalesce supernal erudition into a pathway around the inevitable economic implosion which our love affair with debt has created?  Surely there must be good reason for some experts to be promoting profligate spending.  No?  Are we accepting rationalizations from QE believers that unlike the personal debt borne by consumers, the Federal government can simply, though carefully, arrange to have printed evermore of the world’s favorite currency to nurse its debt affliction?  With other nations also devaluing their currencies such as the Yen or the Euro, almost in lockstep with the U.S., are we clasped together with them in an only-slightly-out-of-phase race to the bottom?

We must be convinced that experts know something we don’t and that they have grasped concepts which eluded Thomas Jefferson when he wrote in 1814, “We are to be ruined now by the deluge of bank paper.” In a world where opinion has transplanted knowledge, authenticity is infused into unworthy illusions.  Does a majority of Society really believe that it cannot accept reductions in deficit spending while it refuses to acknowledge the need for financial diligence over growing government and unaffordable entitlement programs?  Does Washington really reflect the Nation’s wishes?  What is clear, is that personal considerations, personal influence and personal wealth have vanquished the halls of power in the Capital.

The political leadership has succumbed to the irresistibly seductive ‘Easy Money’ of the incomparably powerful and historically unprecedented Federal Reserve. There is nothing subliminal about the seduction which has taken full and absolute control of Washington. There has been nothing subtle or concealed about the production of new debt, and there has been no subtlety of process in the devaluation of the dollar.  Washington’s addiction is unmistakable, and particularly disturbing is that this addiction has so far had few serious consequences for those holding positions of power.

How did we get here?

Let’s recall some of the more infamous proclamations of just over four years ago. Assertions such as, “this is truly a once-in-a-lifetime economic nightmare,” and “the world’s most cataclysmic financial crisis since the Great Depression,” or how about, “world’s impending financial Armageddon.”  These unnerving and sinister shrieks instilled fear into the consciousness of every resident on Capitol Hill.  The perplexed and readily pliant media ensured that the apprehension blossomed into an epidemic. Admonitions of terror were used by Hank Paulson, then Treasury Secretary and formerly CEO of Goldman Sachs, and Ben Bernanke, currently Chairman of The Fed, who only months earlier in mid 2008 had proclaimed that all was well in the economy and that there was no chance that the subprime market problems would impact the broader economic health of the Nation. And their views on the taxpayer backed Fannie Mae, Freddie Mac and AIG, . . . what, me worry?  And yet, here we were, listening to fear, terror, panic, foreboding and threats. And what were the titans of Wall Street demanding as shivers ran up and down the spines of Washington’s decision makers?  A blank check made out to cash with no conditions.  “Too big to fail” along with, “bailout,” became household terms.

The shivering spines turned into talking heads on every evening news outlet in the Nation, parroting that the once-in-a-lifetime impending armagedon had, “left us no choice.”  The money was borrowed, the checks were cashed by friends of The Treasury and The Fed, and then the declarations evolved.  We heard from politicians with newfound bravery, “whew that was close, but weren’t we great, we saved the Nation from doom,” and the ‘inside’ players changed chairs with Geithner replacing Paulson at Treasury.  Across the country almost everyone with a keyboard and a microphone could repeat the chant, “we were on the edge of a cataclysmic crisis, but The Fed and Treasury saved the day.”  The cry had a rhythm and a plurality accepted this new gospel.  A new Administration moved through 2009 and 2010 with an acceleration of long-term financial commitments and borrowing, along with unrestrained check cashing particularly in favor of friendly ‘contributors’.  The Nation had stepped over a threshold and into a new paradigm.

The Nation had become desensitized.   Its elected officials and the banks had surely known something the rest of us did not comprehend.  On the Hill, the affliction spread as a realization that astronomically huge amounts of money could be created seemingly out of thin air and thrown at, . . . well just thrown at whatever might help re-election, and there would be no consequences – at least none in the near-term, and the future would take care of itself.  Epoch-forming levels of debt were created in the comforting expectation that The Fed would take care of ‘managing’ just the appropriate maximum.  It might even administer the creation of an infinite amount of dollars since, apparently, there would be no cost, no downside.  We were in a new era.  We are in a new era.

A decision made in fear and in panic changed the consciousness of Washington.  The new paradigm of increased spending and debt by trillions of dollars, would have no consequence. At least not to the current Washington. This shift, however, will see the next President step into an Oval Office presiding over an America encumbered with an estimated debt North of $20 trillion.  Whatever the amount, there is no will on Capitol Hill to change the narrative, and to the long-term detriment of a misled Nation, there is a deeply entrenched addiction which refuses to be curbed.  As for the value of the dollar in four years?  You will know by the real cost of living to which you will have been subjected.

The constitutionally mandated separation of powers between the Administration and all of Congress with which the Framers so presciently endowed an eagerly awaiting Nation, has been trampled by effectively maneuvered, yet elected, debt junkies.  IMHO, America has been bowed by, and has capitulated to, egocentric forces which do not hold its best interests to heart.

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The Fed and Indentured Citizens

In 1913 Congress abdicated its Constitutional responsibility over currency on behalf of the people when it created the monster called The Federal Reserve System. In creating a private joint stock entity, Congress not only surrendered jurisdiction over the dollar, it also relinquished control, oversight, and authority over the institution intended to manage the citizens’ currency. Decisions hastily made in environments of illiteracy, panic, and fear, and driven by energies with ulterior motives, rarely turn out well for those who succumb.

Section 2A of The Fed’s Monetary Policy Objectives states, “The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.” This ill-defined and loose agglomeration of feel-good nonsense might have tasted better if someone had appended “and preserve motherhood and apple pie,” but such addition would not have improved it. When we consider such additional elements as the fact that, as originally established, the notes issued by The Fed were obligations of the U.S. Treasury (read taxpayer) rather than that of the member banks, well, what could go wrong? 

The Fed’s ‘objectives’ reads as if it was written by The Fed so that no repercussions could possibly result from its own failures. Well beyond the bounds of sanity and far from purview of effective diligence, an isolated institution was formed and exists to command and supervise the currency of the most powerful Nation on Earth. This authority reports to no one. It plays footsies with Congress and with the Administration, but it acts in its own best self interest, as all human endeavors are wont to do. As some of us strongly suspected just prior to the last Presidential election, and as we can now with hindsight confirm, Bernanke and The Fed used their capacity to print dollars in an undisguised effort to support the re-election of pro-Bernanke-pro-Fed-pro-free-money Barack Obama. There is no question that the most powerful financial institution on Earth has strayed well beyond any of the intentions which created it, regardless how unenlightened they might have been. 

 If America was a company and you were its CEO, would the above noted Section 2A provide sufficiently focused objectives for your currency? Not if you were capable of simultaneously walking and chewing gum it wouldn’t. Monetary policy should have One objective – Stability. Simple, clear, unambiguous, stability. And inflation? 0%. Not 1.0% or 4.5%, but zero. 

 Who should be in control? The people. Who represents the people? Congress. Who is in control? A small group of individuals running a small group of too-big-to-screw-up international banks. No-one could possibly mount an intellectual or intuitive argument supporting the assumption that such individuals, their desires and the desires of the institutions under their charge, hold dear the altruistic benevolence of their “fellow human beings.” I cannot say “their fellow Americans” since some of the “owners” of The Fed are not American institutions. Go figure. 

Still, is this any way to run a railroad? Not if we look at the state we are in. Not if we critically assess the reality which has been created over a long process of fiscal mismanagement. Not if we understand that unprincipled individuals have too long politicized the dollar, which was easily done once it was unhooked from the hard commodity, gold. Not if we critically appraise the devastation which The Fed has rendered on a Nation with the complicit approval of self-servers in Washington. 

Politicians of the Congressional and White House variety have evidently been more than enthusiastic in allowing inflation and devaluation of the dollar to proceed apace since the de-coupling of the dollar. The banks behind The Fed controlled the game and were only too eager to comply (as in, OK fine, we’ll go along with it but it’s your idea). There were hundreds of billions to be made through debt guaranteed by taxpayers. There were new illiterate and willing generations to be converted to serfdom with the help of standard wavers such as the New York Times. A bigger chicken in every pot and a larger roof over every head, all acquired through debt. The bigger the debt, the greater The Fed’s profits. And what of the savers? . . . Completely destroyed and pushed toward risky investments. 

The dollar has not been stable and in fact has moved in direct opposition to the best interests of all Americans. It has steadily lost value over the long term. For example, when we are provided obfuscating rationales for the high price of oil (up 400% in a decade), we are being lied to. The truth along the vector of veracity is much closer to the reality that the dollar is dropping in value, however such realization might instill doubt of our long term trends toward prosperity. 

It has been in the best interest of the banks which own The Fed and all member banks, to manipulate interest rates to their advantage. The trends of the dollar (read: your earning power) through the past half century against hard assets such as gold or oil tell a tale of unrelenting plundering and evidences the failure of misguided interventionism. Nevertheless, the worst consequence has been an acceptance of indebtedness. Indebtedness has contaminated all human enterprise. From personal debt, to corporate debt, to State debt, to National debt, the burden overwhelms current and future intents to repay. Total debt floats somewhere well North of $100 trillion. 

In a country where the term “Freedom” has resonated profoundly from its very inception, and throughout its history, the citizens of The United States of America now find themselves subservient to a foreign entity they have no control over. Without economic freedom, freedom is simply an ephemeral concept promoted and repeated as a feel-good mantra mesmerizing the population. Awaking to overwhelming indebtedness is tantamount to waking up to enslavement. 

As we wait for the moment when it becomes widely evident that The Fed has become completely ineffective and we are forced to confront the unavoidable crisis of debt yields rising significantly, some alternatives should and must be considered. 

The ubiquitous nature of today’s technologies, software, computers, phones, and networks, present us with possibilities which brilliant economic minds of the past could not dream of, and too many current ones refuse to. We should no longer regard the current monetary system as the sacred and hallowed domain of a few bankers. Congress should immediately mount a full frontal attack on The Fed and retrieve the control it long ago held. Once Congress has recuperated full jurisdiction and authority over the Nation’s currency, it should then enact laws allowing for the formation of competing bank notes including digital currency to be issued by private entities in an open and fee market. But first, let’s get back mastery over that most critical instrument so pervasive in all human activity – our currency. America should not be the only developed country in the world without sovereignty over its currency.

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Statist Wistful Admiration Of China’s Communist Party

China’s ascendance in our consciousness has been growing steadily for a generation, and we wonder what more impact it will have than has already been felt by our economy and our society. We cannot accurately predict China’s future or its actions going forward, but as it flexes its newfound powers to reshape global conventions, we should remain vigilant that our own perceptions not be warped by ideologically, or otherwise tainted assertions.

Our enthusiastic media collectively extol the moral legitimacy of China’s communist model of political rule which controls 1.3 billion people, and predicts that China’s surpass of the U.S. economy is just over the horizon – scarcely visible as that may be through the toxic haze. Should untarnished freedom be a fundamental human right nurtured within a true democracy, then such adoration of China by our leaders, scholars, pundits and so many others, challenges the core tenets at the heart of the Constitution. 

Defenders of the ethos imposed through coercion within China, rationalize that stomping all over individual rights is a necessity which protects the needs of the collective. Somehow when such justification is vaunted by our own self-anointed intelligentsia, with the always present caveat that, “after all, how else can you rule over 1.3 billion people?” . . . . we capitulate. All the while, our internal turbulence leaves us in visceral disarray. The virtuosos of the PR machines make it all right that we send (through spending), trillions of our dollars to enrich a regime which recent history (1950s and 1960s) has evidenced as the most ruthless in human history. 

As China today shuffles its leadership, we are provoked into accepting that the shifting of nameplates is founded on meritocracy, and not on handpicked automatons perpetuating dictatorship. The reality that much of the current Chinese leadership is formed by the natural laws of heredity and that the sons of well-known revolutionaries today take up the mantel, does not appear to trouble our cognoscenti in the West. Xi Jinping, who will be shortly confirmed as China’s leader is one such “princeling.” We should remember that in China, the Communist Party controls the army, and one only touches the levers of power after having held very senior military posts (read: demonstrated ruthlessness). 

Should we accept the propaganda (East and West) that virtue rises to the top, and that China’s leadership is genetically virtuous and molecularly superior? How affected are we when our media refers to China’s “Communist era,” as if it was some unfortunate ephemeral occurrence of the past, or simply a fading authoritarian dragon which lost its repressive teeth? Just because the Communist Party has carefully allowed some private sector to coexist with state controlled enterprises, it has not relinquished any authority over business, over media, over education, and it is on guard against any de-politicization of the country’s vast military machine. The secretive Organization Department of the Communist Party of China Central Committee controls ‘assignments’ in government and industry. 
The boot is firmly on the neck. 

Recent leaks which the Central Propaganda Department missed, suggest that the high level of corruption within the Communist Party is pervasive. The submissive population cannot react since it knows the potential of the beast camouflaged behind smiles. It knows the despotic force which controls its nation. This is the virtuosity that is so confident that it siphons its billions off-shore, acquiring hard assets like real estate in safe havens like San Francisco, Sidney and Vancouver. The pretence of stability provided by the virtuous Communist Party may not be so well founded given that it cannot explain why so many of its wealthiest have ensured themselves foreign ‘pieds-a-terre?’ It is incapable of explaining why so many of the wealthy have moved their families offshore while they continue to amass personal wealth within China. One acquaintance close to such events reminded me that it is very expensive to move money offshore from China because there are so many hands which have to be taken care of on the way out. Is this virtuosity so prevalent that millions of people, both rich and not as rich, leave the country for foreign shores as soon as they possibly can? 

Before we look at what some of our statist virtuosos of the ‘beau monde’ are selling us about China’s version of communism, we should remind ourselves that any government’s legitimate function is to protect the individual’s rights. 

In 2009 Thomas Friedman, the writer for the oracle of all that is socialistically holy, wrote, ”One-party autocracy certainly has its drawbacks. But when it is led by a reasonably enlightened group of people, as China is today, it can also have great advantages.” This self-asserted sophistication upholding the concept of the benevolent dictator surely must know something which lesser minds cannot comprehend. Or is it more likely an uninformed observation from a philosopher-king wannabe, lost in ideological nonsense attempting political correctness? Whatever its motivation, this claim evidences a complete lack of insight into human nature’s tendencies and desires for self-actualization. Such ignorant percepts miss the fact that stifling people and frustrating their desire for fulfillment of their potentialities deprives them immeasurably. The result is emotional disturbance and psychological pathology. Long term, the consequence is broad based despondency. This socio-economic transport of a Nation into the elitist controlled utopia is the ultimate pinnacle of arrogance. Is this the ‘down river’ that our media is attempting to sell us? 

Confucius once informed, “What the superior man seeks is in himself; what the small man seeks is in others.” 

Let’s take a look at a rather ideal example of someone who would do well to read Confucius – President Obama’s Chairman of Jobs and Competitiveness, Jeffrey Immelt, who moralized on the Charlie Rose Show this past week, . . . . 

Immelt: “State-run Communism may not be your cup of tea, but their government works.” 
Charlie Rose: “They get things done.” 

Well, three cheers for state-run communism. Right? When you instill fear in people to perform your will, you “get things done.” Right Charlie? Charlie may be a herring mindlessly drawn by the statist current which enriches him, but Immelt is not. He is head of a global corporation doing $146 billion and employing a little under a third of a million employees. 

Immelt is self-serving and rationalizing his shift of some General Electric manufacturing facilities to China, knowing full well that the Communist Party makes the decisions on who ‘gets in.’ For now we won’t argue with him whether he could have managed increases in productivity in America instead of moving, but does he really believe what he is saying? Any of it? Does he understand what he is selling? 

The mind behind the visage of Obama’s Job Council seems not to grasp the seriousness of his message, nor its impact. Or perhaps he doesn’t care – there’s a personal empire to build, who cares about the country? Notice that in this interview, as in others, he has no idea what to do about jobs? None. He is evidently only interested in his own. Where is the wisdom? He certainly seems to know how to get taxpayer dollars, warming the Oval Office into the purchase of unproductive and unprofitable windmill farms. He can buy influence and taxpayer cash, with taxpayer cash. 

We cannot forget the enforcement of the population’s conversion to Immelt’s green-technology-made-in-China CFL light bulbs. Don’t ask him what you should do with the toxic mercury in those bulbs once they burn out well before their due date, just take them to the dump. We do not need to question why Immelt’s statist views are supported by GE’s tentacles in NBC, MSNBC, CNBC, NBC Sports, Universal Film Studios. We know why. We also will not bother inquiring into GE’s relationship with the U.S. tax system, since we already know it manages to sidestep that annoying tax thingie. Immelt knows how to ride the East-West fence, and statists applaud him as he promotes the socialist message. 

The Immelts and Friedmans advocate that we too could find success if only we had top down power of overreaching government following the Chinese model as the symbol of perfection. It is unfortunate there are some already in power here who dream of holding reigns of omnipotent influence over the masses. It is doubly unfortunate that these same individuals influence our media. Do they really long for a Chinese version of governance? They and their mouthpieces are certainly selling us hard on it, lying about the realities that lie hidden under the propaganda. 

Individuals like Immelt should be promoting America, encouraging its freedom, and the beauty of its Constitution. They should be praising and protecting the country which provided them their opportunities and their wealth. Sadly they represent a broad element across the Nation, too ready to do away with protection of fundamental individual rights. After all, it works over there, doesn’t it?

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Truth On Fiscal Cliff Negotiations

We apprehensively advance through this nail biting moment in history as a great Nation floats, uncertain, caught in a holding pattern, hoping its leadership will find wisdom enough to avert the so called Fiscal Cliff, even if most of us don’t fully comprehend what such a cliff entails, or even if such a thing exists. We’re too busy struggling, hanging on to whatever we have, hoping for stability, and hoping that tomorrow brings some relief to our stress.

So let’s look for a little insight into what astute and gifted minds are really doing deep in the core of the negotiations apparently so critical to the very future of the Nation. Let’s dig for a sign of prescient coherence determining the very nature of our future.

Here is a discussion/interview which John Mauldin recently conducted with Rob Lehman and David Krone, the chiefs of staff for Senator Rob Portman (R-OH), and of Senate Majority Leader Harry Reid (D-NV), respectively. Lehman and Krone are two very key individuals in the current budget negotiations. Mauldin, who writes on economics and investments, usually refrains from using an ideologically tempered pen. Late in the somewhat non-descript forty minute discussion, a head snapper gets dropped by Lehman, who works on the Republican side of the negotiating table.

At minute 37:00 of the linked video Lehman (R) makes a statement about spending. “We’re talking about reductions in the growth of spending.” He confirms that there will be no reduction in spending. Krone (D), sitting next to him, is drooling out of camera shot. Washington does not spend less year-to-year. Ever. Is that clear? Negotiators are only negotiating amounts of spending increases and areas of such increases in spending. That’s it. Don’t believe anyone standing at a podium performing waffling prevarications in Washington while making claims of imminent spending cuts.

Oh, but wait, you say, what about that the $16.2 trillion in debt which we cannot ignore? When you spend $3.6 trillion, but receive $2.3 trillion, you have to cut over a trillion from your annual expenditures somewhere along the line if you harbor any hope of getting ahead of the backlog of debt and the corresponding overwhelming interest. What about that looming additional commitment in entitlements which will more than quadruple that debt? Hmm. Well, forget about it. Ignore it. Have a good Christmas, and Happy New Year. You’ll never be able to endure that burden, so why worry? We’ll just crank up the presses. Isn’t that how you pay back what you owe? Just print money?

Obama continues down the seemingly never-ending campaign trail, arrogantly pretending that he is providing tax cuts to the middle class and further pretending to demand a “balanced approach.” He has repeated his limited talking points at every recent use of the teleprompter. Someone might explain to him that retaining the Bush tax cuts which are due to automatically expire at the end of December, does not mean reducing the middle class tax rates. He either has no grasp of what he is claiming, or is knowingly lying to the taxpayers.

There are no tax cuts on the horizon and there are no expenditure reductions coming. Spending is out of control, and the truth is that tax increases are coming for all levels of society.

Everyone knows that the mantra “tax the rich” is just demagoguery, . . . well everyone except those with a paucity of common sense. Tax increases for the so-called rich will not put a dent in the deficit. And Obama’s claims of the approximately $10 billion in revenues anticipated from the rich is annoying. He still won’t acknowledge that such supposed anticipated amount is over 10 years. Please, someone tell him. The very rich probably don’t much care, since the increases will simply mean less real redistribution of wealth, but the increase will not impact their lifestyles.

Obama professes that only agreeing to his demands would avoid the ‘fiscal cliff’, and doing otherwise, “would be bad for the economy, it would be bad for those families (supposedly the whole middle class), in fact it would be bad for the world economy.”

He’s getting ahead of Republicans on the “message,” so that no matter what happens, Boehner and the Republican controlled House of Representatives will eat the negative fall-out. And the fall-out is coming, but what is not coming is spending reductions.

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