Tuesday, July 31, 2012

The Long History of Limited Government

In the blog below, I detail the political philosophy of the US Founding Fathers with regard to their unanimous desire to see limited government power.

Ronald Reagan said that we're one generation away from losing our freedom if our values and beliefs are not taught to the new generation.  Here's the full quote:

Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same, or one day we will spend our sunset years telling our children and our children's children what it was once like in the United States where men were free.
Limited government has been the norm for the vast majority of America's history.  Then about 1913, the Federal income tax was initiated. ( It had been struck down previously as unconstitutional)  This means that for most of US history, the federal government was so small that it existed on excise and other minor taxes on commerce.  Even after World War II, during which Federal government spending became 50% of the economy, it again shrank to 9% of the US gross domestic product after the war (late 1940's).  

Current Government spending and it's trajectory are not only out-of-control at 25% of GDP,  but totally at odds with the vast historical experience of this country--a country where free market capitalism, small government and low taxes on income and capital built the largest and most successful economy the world has ever seen.  It wasn't many years ago that the US economy was 5 times larger than the 2nd largest (Japan).   That's how successful we were!   We became a hyper-power.

Apparently we want to change all that and become a stagnated state with ruinous national debt that can only be repaid with inflated dollars by our children?  We want more ruined populations dependent on government programs?  Apparently so, because we don't know our own history, we are satisfied with a crony-government, crony-capitalist state for sale to the politically connected or highest bidder?  Well, that's where we're at right now.  That's what you ALWAYS get with big government in a nation as large as the USA!

US Founding Fathers Favored Limited Government

There are not enough words in the English language to praise the political wisdom of the USA Founding Fathers.

The writings of Franklin, Paine, Adams, Madison, Hamilton, Jay and Jefferson all deal with the fear of excessive government power and all of our Founding Fathers, with no exception, were solidly and unequivocally in favor of limited government. Having fought a war with England , the country whoe abused the colonist's rights and liberties are well-documented in the Declaration of Independence, the Founding Fathers were keen to avoid infringements to Freedom and Liberty by an overly-powerful central government. The Constitution ultimately was written to give specific (enumerated) powers to the Federal branch and "The powers not delegated to the United States [Federal Gov't] by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people"

The Bill of Rights was added for emphasis of inalienable rights of the citizens to be protected by any government.

For example, here's a quote from Thomas Paine:
Society in every state is a blessing, but government even in its best state is but a necessary evil in its worst state an intolerable one; for when we suffer, or are exposed to the same miseries by a government, which we might expect in a country without government, our calamities is heightened by reflecting that we furnish the means by which we suffer! 
[Commenting that if we were all perfectly responsible and considerate, there would be no need for laws or a government at all] Government, like dress, is the badge of lost innocence; the palaces of kings are built on the ruins of the bowers of paradise. For were the impulses of conscience clear, uniform, and irresistibly obeyed, man would need no other lawgiver; but that not being the case, he finds it necessary to surrender up a part of his property [taxation] to furnish means for the protection of the rest; and this he is induced to do by the same prudence which in every other case advises him out of two evils to choose the least.
Wherefore, security being the true design and end of government, it unanswerably follows that whatever form thereof appears most likely to ensure it to us, with the least expense and greatest benefit, is preferable to all others. [He's saying the only real purpose of government funded by taxation is security]– Thomas Paine (Common Sense, 1776)
The quote above is interesting because it exposes the trade-off between citizen's good sense of responsibility and the need for government or "lawgiver". Taken to it's extreme, perfect individual behavior and responsibility would require no laws or government at all! Therefore, it means that limited government requires a high degree of "conscience" and responsibility. If personal responsibility declines in a society, which it most certainly is in the Western world, then limited government becomes impossible.

It's telling that much political activity, especially the Democratic party, is increasingly about the relief of individual responsibility and replacing it with bigger government.  Oh, you can't pay your mortgage? No problem, we (the taxpayers) will absorb the loss or you can break your contract! Contracts aren't really contracts are they??  You're in the US illegally? No problem, we'll turn our heads!  And if The States take action on illegal immigration where the Federal government has abdicated it's responsibility, then the Feds will sue you!  You don't have enough money to pay the rent? Surely you'll qualify for housing subsidies! Not enough to eat? Apply for Food Stamps!  You get pregnant, no problem, you can get an abortion!  It doesn't matter if it's morally repugnant, as long as you're relieved of your own responsibility in this matter!  You didn't have the discipline to stay in school?  No problem, we have plenty of government training programs. You don't have a job? No problem, we'll give you extended unemployment! (Never mind the government CAUSED the unemployment!)

I don't mind temporary safety nets, but you understand my point?  The problem is multi-fold: the cost of government itself and the moral problem with an impersonal bureaucracy supposedly "taking care of you." Family and community are the first and ultimate Department of Health, Education and Welfare. The "government" is undermining all of this in the name of "nice-sounding" Leftism. People dependent on government will find out that the government is broke when they need them the most. There is no substitute for self-reliance, hard work and self-sufficiency.

Unfortunately, the US is in one of the last legs of a "cycle of civilizations" and this loss of "discipline" is accelerating our decline. A writer has written a relevant cycle that Western civilizations progress:

From bondage to spiritual faith
From spiritual faith to great courage
From courage to liberty
From liberty to abundance
From abundance to complacency
From complacency to apathy
From apathy to dependence
From dependence back into bondage

I'd say that America and Western Civilization is in the "dependence back into bondage" stage. Any comments?

Wednesday, July 25, 2012

Obama's Enemy List; Un-American Dirty Tricks

In a recent article in the Wall Street Journal, by Kim Strassel, the paper detailed the story of Romney campaign donor Frank Vandersloot who has found himself under attack, first from the President's campaign, then finding out about a private investigator digging for dirt in his hometown, then just weeks later, receiving audit letters from the IRS and Department of Labor.

Since he's never been investigated before, you'd be a fool not to see that the US Government is now attacking and slurring supporters of the political opposition.  You'd also be a fool to not suspect complicity all of the way to the White House.  This must not be un-answered!!

Now for the quote:
An Obama campaign website in April sent a message to those who'd donate to the president's opponent. It called out Mr. VanderSloot and seven other private donors by name and occupation and slurred them as having "less-than-reputable" records. (my comment:  that's called "libel" in normal parlance!)
Mr. VanderSloot has since been learning what it means to be on a presidential enemies list. Just 12 days after the attack, the Idahoan found an investigator digging to unearth his divorce records. This bloodhound—a recent employee of Senate Democrats—worked for a for-hire opposition research firm.
Now Mr. VanderSloot has been targeted by the federal government. In a letter dated June 21, he was informed that his tax records had been "selected for examination" by the Internal Revenue Service. The audit also encompasses Mr. VanderSloot's wife, and not one, but two years of past filings (2008 and 2009).
Mr. VanderSloot, who is 63 and has been working since his teens, says neither he nor his accountants recall his being subject to a federal tax audit before. He was once required to send documents on a line item inquiry into his charitable donations, which resulted in no changes to his taxes. But nothing more—that is until now, shortly after he wrote a big check to a Romney-supporting Super PAC.   
 Two weeks after receiving the IRS letter, Mr. VanderSloot received another---this one from the Department of Labor. He was informed it would be doing an audit of workers he employs on his Idaho-based cattle ranch under the federal visa program for temporary agriculture workers.

"It is un-American and irresponsible for a president to target individual, law-abiding citizens for political retribution, and it is inconceivable that any U.S. agency would stoop to do the bidding for this campaign's silliness," says Louis Bacon, an investor and conservationist who also made the Obama list.

This must be investigated and questions must be answered. After all, are we stooping to become like Putin's Russia?? Comparisons to Nixon are bad enough!

Shameful! As I've said before, the true "color" of Obama and his roots in thuggish "Chicago-Style" politics is more and more clear.  Expect more evidence to emerge as Romney remains competitive in the campaign.

Tuesday, July 24, 2012

The Intellectual Vacuum Of The Obama Administration

Redux of "Carterism"
This author has lived long enough to have seen the disastrous "statism", ie, government intervention, threats of rising taxes and hyper-regulation of the Jimmy Carter's administration fail in the real economy, and leave candidate Carter with no new ideas for his 1980 re-election campaign.

Now, 30 years later, I have a sense of deja vu as the Obama has recycled many of the same "solutions" as Carter.  Even candidate Obama in 2008 sounded like he was stuck in the 1970s during his campaign although never giving much detail.  It was always just "hope and change".   One time, even McCain puzzled about Obama, "for a young man, you seem to have a lot of old ideas?"

It's as if these people never learn anything?

So, the Obama administration is now out of ideas except trivial ideas like taxing millionaires (which would raise only $4 billion in 10 years according to the CBO) meaning that's only a political ploy.   For 3 1/2 years, Obama has never had any detailed solutions nor has ever offered serious and detailed leadership for any of the legislative initiatives, leaving all the details to the disastrous Pelosi and Reid.   Obama obviously was personally, politically and intellectually unprepared for the job.  The results are legislative abortions of Dodd-Frank and ObamaCare--both are still unfinished, vastly over-complicated and overreaching and not implemented even years after passage.

All of his key staff has moved on with their tails between their legs;  czars, quasi-communists and socialists alike.  Geithner should walk also away in disgrace.

Attacks and Dirty Tricks
Now candidate Obama is showing desperation as he has no record worth running on.  So, it's attack, attack, and attack.   Also, there's lies too.  You can see the dirty "Chicago-style" politics show themselves.  So, Obama is at war with businessmen (but needs their campaign contributions), spouts completely trivial "solutions" and resorts to lies against Romney.  Now we hear of an "enemy list" where the Obama Administration is targeting businessmen who contribute to Romney's campaign by imposing audits from the Dept of Labor and the IRS.   It's reminiscent of the horrible Nixon administration.

Nixon was impeached for dirty tricks and lies.  It's especially disconcerting when I hear of the Federal Government, with unlimited resources, attacking specific individuals for their politic views.   Are we in a Communist Police state?

Where is "Hope and Change"??

Reagan Had Faith in Businessmen and Entrepeneurs

Reagan Answers Obama with Faith in Businessmen and Entrepreneurs  (hat tip to James Pathokoukis at his American Enterprise Institute blogsite)
Reagan delivered a speech in 1983 after the steep recession caused by Paul Volker had already vanquished runaway inflation and the economy was recovering sharply. The tone of Reagan vs. Obama could hardly be more different. Reagan was a truly a man of faith and principle from America's greatest generation. Here is an excerpt:
The character and conscience of small business built this nation. You know, in his book, ``Wealth and Poverty,'' George Gilder wrote something about entrepreneurs that I've long believed. He said that, ``Most contribute far more to society than they ever recover, and most of them win no riches at all. They are the heroes of economic life, and those who begrudge them their rewards demonstrate a failure to understand their role and their promise.'

Well, wouldn't it be nice to hear a little more about the forgotten heroes of America -- those who create most of our new jobs, like the owners of stores down the street; the faithfuls who support our churches, synagogues, schools, and communities; the brave men and women everywhere who produce our goods, feed a hungry world, and keep our families warm while they invest in the future to build a better America? That's where miracles are made, not in Washington, D.C.

We hear so much about the greed of business. Well, frankly, I'd like to hear a little more about the courage, generosity, and creativity of business. I'd like to hear it pointed out that entrepreneurs don't have guaranteed annual incomes. Before they can turn a profit, they must anticipate and deliver what consumers want. They must risk their money with investments.

The truth is, before entrepreneurs can take, they must give. And business begins with giving. And I believe business works best, creates the greatest wealth, and produces the most progress for all when we're free to follow the teachings of Scripture: Give and you will be given unto . . . search and you will find . . . cast your bread upon the waters and it will return to you manyfold.

Just think about it. In the Parable of Talents, the man with the small-business spirit who invested and multiplies his talents, his money, was praised. But the rich who hoard their wealth are constantly rebuked in Scripture. I believe we're meant to use wisely what is ours, make it grow, then help others to share and benefit from our success. And the secret of success is understanding that true wealth is not measured in material things, but in the treasures of the mind and spirit.

Oil was worthless until entrepreneurs with ideas and the freedom and faith to take risks managed to locate it, extract it, and put it to work for humanity. Someday, oil itself will be replaced if those driven by great dreams are still free to discover and develop new forms of energy.

The principles of wealth creation transcend time, people, and place. Governments which deliberately subvert them by denouncing God, smothering faith, destroying freedom, and confiscating wealth have impoverished their people. Communism works only in heaven, where they don't need it, and in hell, where they've already got it. [Laughter]

When we came to Washington, I said, ``Let us renew our faith and our hope. We have every right to dream heroic dreams, to believe in ourselves, to believe that together, with God's help, we can and will resolve the problems which now confront us.''

We didn't propose a 20-point Federal plan. We pursued the one sure plan to get America moving again -- a renaissance in enterprise. Everything we've tried to do is guided by three simple words: Trust the people. We wanted to use that special principle of giving by putting America's destiny back in your hands. And this meant slowing the growth of an already bloated government and providing you incentives to save, to invest, and to take risks, so more wealth will be created at every level of our society. 

Now that's what I call principled leadership! Apparently we will never see the likes of him again

Spain's Way Out Of A "Punishment" Union

Spain is in the grip of an economic depression with unemployment at 24% and youth unemployment at 50% due to the "popping" of their property/housing construction bubble.

The bubble was caused by Spain joining the Euro in 1999 and adopting Euro-wide interests rates that were below the rate of inflation in Spain at that time. That meant that there was an incentive for people to buy homes or apartments that were appreciating at 6% where the cost of money was only 3%. It paid for borrower to borrow money! And they did! This caused a huge property/housing bubble in Spain and Ireland. Anyone with half a brain could have foreseen this. All this is due to the Euro "project". 

Now their banks, and even regional and national governments are insolvent. In fact, there's nothing but insolvency everywhere and a huge capital flight and slow motion banking panic is underway. Now, the solvency of the entire European banking system is gone due to the cross holdings of these bonds (Spanish, Portuguese, Irish, Greek, and Italian) by Northern European banks. Those bonds are deeply underwater but banks are "pretending" that they are worth 100 cents on the dollar.

Now the "reverse" of bubble conditions has hit and the Euro project has trapped Spain (and other countries) in a depression.  With no way to devalue their (own) currency to stimulate their economy, they are suffering from the flip side of the bubble--outright depression. And they are being forced to be in an even deeper depression by Germany who, true to their nature, are demanding more "discipline" by cutting government spending even as the country is spiraling into a 1930s style depression.

Something has got to give.

According to Ambrose Evans-Pritchard at The Telegraph, he says that it's time for the southern tier of European states to seize the initiative and force an end to their "punishment union."  Here's how it could happen according to Evans-Pritchard:

It is time for Spain and the victim states to seize the initiative. They cannot force Germany, Holland, Finland, and Austria to swallow eurobonds, debt-pooling and fiscal union, and nor should they try since such a move implies the evisceration of their own democracies.
What they can to do is use their majority votes on the ECB's Governing Council to force a change in monetary policy. Germany has two votes out of 23, with a hardcore of seven or eight at most. The Greco-Latin bloc can force a showdown. If Germany storms out of monetary union in protest, that would be an excellent solution.
The Latins would keep the euro - until the storm had passed - allowing them to uphold their euro debt contracts. There would be less risk of sovereign defaults since these countries would enjoy a pro-growth shock from monetary stimulus and a weaker Latin euro against the Chinese yuan, the D-Mark, and the Guilder.
The currency misalignment eating away at EMU would be cured instantly. There might even be a stock market rally once the boil was lanced. It would certainly be a better outcome than the current course of deflationary Troika regimes and loan packages for economies trapped with the wrong exchange rate, destined to end with one country after another being thrown out of EMU in a chain reaction.
For Germany it would entail a revaluation shock and stiff losses for German banks and insurers with large holdings of Club Med debt.
If Germany wished to soften the blow, it could do exactly what Switzerland is now doing by holding the Swiss franc to CHF 1.2 against the euro by unlimited intervention. It could fix the D-Mark rate against the Latin euro at whatever was deemed bearable, for as long as needed.
So, if the "Latin" southern European countries forced a change in monetary policy that was deeply abhorrent to Germany, then it might force a split of the Euro into a Southern Euro and a Northern Euro.   In all likelihood, it must happen as the current situation is totally untenable.   No politician can ask their people to accept a depression-forever scenario now being enforced by Germany.

Wednesday, July 18, 2012

Capitalism versus Cronyism and Big Govt

From ZeroHedge:

One common claim is that capitalism exploits the masses for the benefit of the few. Many people who think capitalism exploits workers advocate increasing government power over the economy. Professor Matt Zwolinski suggests, however, that government power may be more exploitative than free-market capitalism. After all, in the marketplace, individuals have power over how they spend their money. The government, however, possesses the power to coerce citizens to pay for policies or programs they may not support, like bank bailouts. Zwolinski argues that bigger government makes citizens more vulnerable to exploitation.
Here's his short but good video:

Bigger government ultimately means more corruption and a loss of your liberty. The US Federal government spending was only 8% of our GDP just 60 years ago, was steady at about 19% for decades and has rocketed to 25% thanks to Bush and Obama. Slowly but surely, the reach of Big Brother becomes oppressive and intrusive when Government has virtually unlimited power to tax and fund itself.  To maintain their hegemony over the citizens, Big Government becomes coercive thenWe need a "no growth"or shrinking government (demand more productivity). Ron Paul was always the right choice for President. I have my doubts about Romney, but Obama is, and has been, wrong for America.

Sunday, July 1, 2012

US Ghetto Culture and Growth Industries

Food Stamp Nation
Over one in seven Americans are now using Food stamps.  And, as the government runs $1+ Trillion deficits for the 4th year in a row, the government is running ads to get more people enrolled in the program.  The cost of this program alone is some $80 billion per annum and rising rapidly.

According to CNN Money, the USDA is running ads to encourage more enrollment of eligible people. There are some 46 million people on this supplemental assistance program up from 27 million in 2007.  Obviously the ongoing recessionary conditions are hurting the poor more than anyone else--as is always the case.

WalMart's Gain
From Mike Krieger at Zero Hedge, reports that from 25 to 40% of some of WalMart's store revenue come from the Food Stamp program. Not surprisingly then, as Food Stamp and Social Security disability rolls continue to rocket higher (more on Social Security Disability in an upcoming blog), WalMart stock is up 14% this year to date. Welcome to one of the few growth businesses in America!

I've been in plenty of WalMarts and I've wondered many times if I'm in a 3rd world country.  I alternate between feeling if I'm in West Africa, in Central America or in Mexico.   Or did the prison buses just arrive?   I'm not wrong about the criminals either.  I know two people who have been assaulted in WalMart parking lots.

Ghetto Culture
As if you needed further reminder of the US Ghetto culture, Mike Krieger also notes the Corrections Corp of America stock price is up 41% this year! The ticker symbol is CXW. Now, that's a great stock! I wished I owned it!

Obviously they build and operate prisons. I'm sure they will help to incarcerate a large number of those 3rd world nationals frequenting WalMart and spending Food Stamp money.

So, there you have it.  America's growth industries are prisons and businesses who benefit from Food Stamp money!   I guess you could add gambling casinos, marijuana production, and lotteries as US "growth" industries to complete the picture of increasing US cultural decay.

Definitions to Understand "Liberal Speak"

A fun guide to Liberal "buzz" words and phrases from Cliff Asness and Zero Hedge:

Failed Policies of the Past

Definition: Limited government, free markets, personal responsibility, liberty.

Social Darwinism

Now is defined as "any attempt by conservatives and libertarians to rein in the unsustainable spending of out of control government."


Definition: Something provided by other men and women’s labor that some claim as their right, sometimes claiming to have paid for it during their lifetime, when all forms of modern mathematics and accounting reject that notion.


Used in a sentence: “I have a right to healthcare.”

Definition: A more extreme form of “entitlement” defined above. Note that modern usage throws out the long tradition of natural rights only of a negative nature, that is, the right not to have something done to you, for rights of a positive nature, that is, the right to certain goods and services, like health care, Apple products, and soy milk. Since, no matter how important these items are, these modern positive rights must still be produced and taken from others, essentially the word “rights” now often stands for a system of slavery and theft.

Paul Ryan

Definition: A “Paul Ryan” is a Hollywood monster which kills and devours old people simply by showing them a preliminary reasonable plan to grow spending slower than we currently are, while keeping any obligations already made to the elderly.


Definition: To make something (e.g., government) bigger, more intrusive, less efficient, and more dictatorial.


Definition: We found one old sap from the other party dying for one last shot at relevance who will add his name to our highly partisan effort.

Right Wing Extremist

Definition: Someone objecting in any way to left wing extremism.


Definition: Moron


Definition: A word that when applied to yourself conveys an instant halo of goodness that does not have to be justified with actions, logic, or even the slightest examination of what the policies you support have wrought. Works particularly well for rich hypocrites (Wall Street) and rich morons (Hollywood).


Definition: A rebranding of “liberal” post-Dukakis, going back to an older word, that means essentially the same thing, but contains the very positive word “progress” within it, and the always welcome “ive” ending.


Definition: A philosophy held by annoying bastards who happen to be right about nearly everything. Fortunately, due to the frustration that comes with being right about nearly everything, in a world wrong about those same things, there are only 19 of them, and we’re going to find the bastards soon.

The Party of No

Definition: Legislators who are rightly demonized by the press and progressives for being elected to bring down the size of government and then actually trying to do so.

Trickle Down Economics

Definition: A brilliant marketing phrase for denigrating the truth: that a freer economy helps everyone. Not to be confused with “trickle up poverty” a perfect definition of socialism.


Definition: An excellent form of government where if you can cobble together 51% of the people, by promising them other people’s stuff, or scaring them that you’ll take away their stuff, you can rule as a dictator. It is decidedly not the form of government originally chosen by the United States of America, which is a constitutional republic with limited government. Thankfully we’ve mostly done away with that nonsense.


Definition: A word that is a hate crime if used about an American politician who wants us to be more like Europe. Or, alternatively, a word used by many European politicians to define themselves.