The View From 1776
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Sunday, November 30, 2008
Generous With Other People’s Money
Liberal-progressives presume that they can do no wrong, so long as they take other people’s money for the benefit of the secular and socialistic welfare state.
Citicorp’s Robert Rubin is getting harsh words from investors who ask why he should receive $115 million in annual compensation, while shrugging off any suggestion of personal responsibility for the banking giant’s horrendously imprudent investment policies. Mr. Rubin says that he was merely a broad-gauge policy advisor, that problems arose from the policies he supported only because of poor execution by underlings.
In the same vein, liberal-progressives steadfastly maintain that socialist welfare-state policies always fail only because the government didn’t spend enough money, long enough.
Like New Jersey governor Jon Corzine, his liberal-progressive, former Goldman Sachs colleague, Mr. Rubin, the Clinton administration’s Secretary of the Treasury, apparently believes that liberal-progressives can do no wrong, because they know what is best for you and me. What is best in their judgment is confiscating our earnings and redistributing them to favored special-interest groups in the name of social justice.
Redistributing wealth, in the dogma of the socialist religion, is a step in the direction of eliminating private property ownership. That mythology, elaborated in Jean Jacques Rousseau’s Social Contract, instructs us that original sin was the advent of private property, which changed human nature and introduced greed, crime, and warfare to society.
In the Judeo-Christian tradition, original sin was Adam and Eve’s eating fruit of the tree of knowledge, seeking to become God’s equal in knowledge and power. Christians and religious Jews are schooled to eschew preoccupation with self and to seek ways to help others, while prayerfully acknowledging that all their blessings come, not from themselves or the secular political state, but from God.
In contrast, liberal-progressives like Messrs. Rubin and Corzine assume that they have successfully eaten the fruit of the tree of knowledge (the modern gnosticism of socialism) and are therefore wise and powerful enough to play God here on earth.
Just as in Mr. Rubin’s failure to take responsibility for disaster on his watch at Citicorp, liberal-progressive Republicans and Democrat/Socialists repeatedly raise taxes to confiscatory levels, and expand the nanny state with deficit financing, heedless of the destructive effects on public morality and financial stability.
Liberal-progressivism’s welfare state encourages self-centered, special-interest greed, evidenced currently in the public’s unwillingness to reduce government spending in the face of approaching bankruptcy at state and Federal levels.
Ironically, the Federal Reserve’s massive over-expansion of the money supply to finance deficit spending, the be-all and end-all of liberal-progressive policy, is the root cause of the financial system disaster in which Citicorp played a major part. Mr. Rubin, we may suppose, sees no connection between his advocacy of imprudent policies in the Federal government and their fostering greed at Citicorp.
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Monday, November 24, 2008
Be Thankful
With Thanksgiving upon us, let’s not focus upon turkey dinners and sensual pleasures. It’s the time to thank God for His bounteous blessings.
Pastor Dan Gardner at the Cohocton (New York) Assembly of God Church reminded us this Sunday of some of the things about which all of us can feel joyful. (My embellishments regarding the malign influence of the detestable doctrines of liberal-progressive-socialism are not necessarily to be attributed to Pastor Gardner).
Be thankful for God:
And the twenty-four elders, who were seated on their thrones before God, fell on their faces and worshiped God, saying:
?“We give thanks to you, Lord God Almighty, the One who is and who was, because you have taken your great power and have begun to reign.” (Revelation 11:16-17)
Be thankful for God’s Creation:
Come, let us sing for joy to the LORD; let us shout aloud to the Rock of our salvation.
Let us come before him with thanksgiving and extol him with music and song. For the LORD is the great God, the great King above all gods. In his hand are the depths of the earth, and the mountain peaks belong to him. The sea is his, for he made it, and his hands formed the dry land. (Psalms 95:1-5)
Be thankful for God’s word:
Oh, that my ways were steadfast in obeying your decrees! Then I would not be put to shame when I consider all your commands. I will praise you with an upright heart as I learn your righteous laws. (Psalms 119:5-7)
In today’s troubled world, and in our own kulturkampf between emissaries of the secular political state and witnesses for the kingdom of God, it’s comforting to know that we can turn for sure guidance to God’s word.
Be thankful for God’s promises and blessings:
Let them give thanks to the LORD for his unfailing love and his wonderful deeds for men. Let them sacrifice thank offerings and tell of his works with songs of joy. (Psalms 107:21-22)
Be thankful for family - our own, the local church family, and the great world family of the Christian church:
Sing to God, sing praise to his name, extol him who rides on the clouds
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Sunday, November 23, 2008
Judicial Excess On The Left
Read the article in National Journal by Stuart Taylor, a moderately left-of-center legal analyst.
Saturday, November 22, 2008
Is Laissez-Faire Finished?
The free marketplace was the antidote to toxic securitized assets created by government’s socialistic interventions that distorted economic judgment.
French President Sarkozy, along with many other political leaders, gleefully declared that free-market capitalism is dead. In their view, only the centrally-planned economy, regulated by welfare-state bureaucrats, can function effectively; only the socialized political state can support the life, liberty, and pursuit of happiness proclaimed by the Declaration of Independence.
Liberal-progressive pundits tell us that banking deregulation caused the subprime meltdown, though none of them can demonstrate cause and effect between the two. The collapse of much of the banking community is said by liberal-progressives to reflect a fatal theoretical flaw in capitalism and to justify, indeed to demand, its replacement by a socialist, managed economy.
What liberal-progressives fail to recognize is that the free marketplace did very well what it is supposed to do: assess the goodness of products and price them appropriately. This interplay between demand and prices is the most effective mechanism in economic history for efficiently allocating scarce economic resources.
As economist Joseph Schumpater famously said, an essential aspect of capitalism is creative destruction. When an economic process is deeply flawed, or when a better economic process is developed, rejection by the free market economy destroys the old. The example of buggy whip producers being run over by Henry Ford’s Model T is overworked, but apt.
Lost in the panic is the fundamental fact that the market mechanisms supporting the housing boom and the proliferation of non-creditworthy debt were planned and mandated by the Federal government. The free market merely responded for a time to the Federal bureaucracies’ interventions.
When it became apparent, however, that the structured investment vehicles and huge pools of securitized mortgages and other debt instruments were composed of rotten assets, the free market did its job. It sharply reduced the prices of poor quality securitized debt and punished the most egregious of their non-government structurers and purveyors.
Contrast this to government anointed and government-run programs. No matter how unnecessary or grossly inefficient, it is almost impossible to kill a government program once initiated. Government programs exist to buy votes. They are impervious to rational analysis and heedless of efficiency.
The centerpiece exhibits are Fannie Mae and Freddie Mac. As quasi-Federal institutions with an implicit Federal guarantee of their debt obligations, Fannie and Freddie were able to grow unchecked to mammoth proportions. Until the final market collapse, they were protected by Democrat/Socialists in Congress against all scrutiny.
When free-market credit analysts questioned Fannie’s and Freddie’s lending and accounting practices, Congress refused to listen. Even after government investigators uncovered fraudulent accounting and highly risky balance sheet maneuvers, Democrat/Socialist congressional leaders stiff-armed Republicans who demanded corrective action.
Without the ability to offload bad mortgage loans into the Fannie Mae and Freddie Mac secondary market, banks would have carried the loans on their own books, and they would have been considerably more prudent in judging risk. But government intervention in the free market wildly distorted economic incentives by making it both highly profitable and necessary to generate and package subprime mortgage loans.
The 1977 Community Reinvestment Act compelled banks to make mortgage loans to unqualified borrowers. Before that legislative act, banks confined their lending to creditworthy borrowers with documentable jobs and incomes sufficient to service their debt. But with Federal regulators threatening economic punishment for failure to make risky mortgage loans to uncreditworthy borrowers, banks complied and sold those loans to Fannie and Freddie.
The subprime meltdown and financial collapse thus were the product of socialist government, not the free marketplace. The root of the subprime meltdown and financial collapse was the Fed’s over-expansion of the money supply. Coupled with it, the government’s socialistic intervention with Fannie, Freddie, and the Community Reinvestment Act’s mandate for uncreditworthy mortgages in high-risk neighborhoods, gave us today’s fiasco.
It was free-market capitalism that finally opened the barn doors and began the process of shoveling out government-produced financial excrement. The Federal government meanwhile is considering perfuming socialist labor union outhouses that don’t deserve to survive.
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Saturday, November 15, 2008
Amplifying Krugman
The economy is more complex than Paul Krugman’s simplistic macroeconomics model.
Read Why Spending Stimulus Plans Fail in the Wall Street Journal.
See also Stimulus Packages: 1929 to 2008 and Why Tax Rebates Are Delusional.
More effective than pumping inflationary dollars into consumers’ hands would be one of JFK’s primary stimulus measures in the 1960s. As Ernest S. Christian and Gary A. Robbins wrote in The JFK Stimulus Plan (Wall Street Journal, January 12, 2008;
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Friday, November 14, 2008
More on the Auto Bailout
Read Charles Krauthammer’s list of other destructive effects of the Democrat/Socialist Party’s proposed socialization of the auto industry.
Why waste time funneling money to socialist labor unions via GM and Ford, thence to the Democratic National Committee as campaign contributions. Why not just transfer the auto bailout money directly from the Treasury into the DNC coffers?
Thursday, November 13, 2008
Time to Flip or Flop
Read Obama’s Second Thoughts On Iran.
Wednesday, November 12, 2008
Krugman
If socialist propagandist Paul Krugman deserved the Nobel Prize in economics, it wasn
Tuesday, November 11, 2008
Subsidizing the Teachers Unions
Why does president-elect Obama propose to appropriate Federal funds to educate an additional 100,000 scientists and engineers? A pay-off to the teachers
New York Times columnist John Tierney, one of the very few on that newspaper with his head screwed on straight, asks What Shortage of Scientists and Engineers?
His analysis supports the earlier commentary by my friend Frank Madarasz in Scientific Research: Maybe it is Salaries.
If there really is no shortage of engineers and scientists in the United States, why waste Federal funds, in the face of a staggering, inflationary budget deficit, to add capacity to an already overbuilt segment of the academic community?
In fact, why not get the Federal government entirely out of funding education, which to an alarming extent is for the purpose of inculcating socialism?
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Monday, November 10, 2008
Follow Jesus; Proclaim the Gospel
Jesus’s commandment to the original disciples, and to every Christian today, is to be witnesses for the glory of God.
Sunday’s sermon at the Cohocton (New York) United Methodist Church was preached by Rev. Karin Porch. Her text was Luke 9:57-62.
As they were walking along the road, a man said to him, “I will follow you wherever you go.” Jesus replied, “Foxes have holes and birds of the air have nests, but the Son of Man has no place to lay his head.”
He said to another man, “Follow me.”
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