America: The Land of the Free or A Nation of Slaves?

My people, my family, or at least lines of my family, have resided in America since the early colonial days.   They came for the promise of a better life, free from the political entanglements and intrigues , from European politics, and the shackles of class.  They came seeking, in a word, liberty, and here they found it, albeit at the expense of the eastern Native American tribes.  They understood at a deep, near subliminal level what freedom and liberty meant.

American’s today know the words liberty and freedom.  Indeed, our national anthem extols “the land of the free.”  Our politicians mouth the words liberty and freedom ad nauseum, but do Americans truly have a clear understanding of these words.  I think not.  We have liberty and freedom in this country only in so much as the government permits us.

If one has liberty, one has a right to one’s person and ones property, and along with that, the right to protect ones person and ones  property.  This is the fundamental libertarian or classical liberal principle of  self-ownership, and it is from this single fundamental principle from which libertarian ideology proceeds.   Another term for this state of liberty is individualism.  To better understand this idea of self-ownership, let us look at what it means to be a slave.  First, a slave has no right to his person.  A slave is property.  Before the civil war, many slave owners spoke of abolition (in a convoluted and disingenuous fashion, mind you) as an attack on property rights.  As property, as a slave, you have no self-ownership, you are owned by a “master.”  Your entire life is lived at your master’s bidding.  You work, you eat, you sleep when told, and the produce of your labor belongs to the master.  Even the children of the unions which the master might demand in order to create more beautiful or stronger slaves belong to the master.

In opposition to this, if one has liberty, one chooses where and when to work, where and when to sleep, with whom they sleep, and the produce of your labor is yours, and yours alone to do with as you please.  Given these two distinct states of being, where on the scale from absolute slavery to absolute liberty are Americans today, or can be no admixture of the two?  Is it possible for one tobe partly free or partly a slave?

I tend to conceive of liberty as a positive term, as an absolute term because it encompasses the simple and singular right of self-ownership.   Slavery, however, may have numerous states in which it more nearly approaches liberty, or is further removed from liberty.

I am told that it takes the average American about four months of their labor to work of their debt to pay their income taxes.  This is simply an indenture, a form of slavery.  The government decides how much of my hard earned money they want to take, and they take it under threat of  my punishment, of my imprisonment.

Now, some would say, the government does good things with that money… they build roads and ports, they protect our shores from invasion, they feed the poor…, but let me ask a question.  If your neighbor came into your home, put a gun to your head, and told you to give him one third of all your money, but not to worry, that he was going to go out and do good things in the community with it.  What would you do?   After writing the check to avoid being shot in the head, and after your neighbors departure, you would go to the phone, call the police, and have him arrested.  Theft is theft, no matter how it is carried out.

A gentleman by the name of Frederick Bastiat called this “legalized plunder,” and that is precisely what it is.  There is no moral coherency between the government and the people.  The government operates under a different set of rules.  They are the master, and we the slaves.

America… a nation of slaves

There is Hope for America!

Browsing the Mises website, there was an brief article on Hayek’s Road to Serfdom. I have slowly been working my way through a mountain of Libertarian books, and just happen to currently be reading this classic work, so I took a look at the article.

Having lived nearly six decades, I admit to seldom being surprised, but by golly a single sentence in this piece astonished me.  After getting a plug on the Glenn Beck Show, The Road to Serfdom is currently the number one selling book on Amazon.com.

There is little doubt that this book is a very worthy read, but the fact that it is the highest selling book on Amazon was, well, shocking to me.  This one sentence gives me more hope for my country than I have had in years.

For those of you that don’t know, this book is perhaps the greatest defense for classical liberalism (the political philosophy of our founding fathers), and argument against socialism that has ever been written, and along with Glenn Beck, I encourage you to read it.

The  Road to Serfdom: Despotism Then and Now – Thomas J. DiLorenzo – Mises Daily.

The U.S. Is Not Too Big To Fail

If you were to ask most any of the big government hacks (republicrats) in Washington the definition of “Fiscal Responsibility”, I am quite certain that all you would get would be a vacuous stare.  For decades, politicians have been assured by our central bank that it doesn’t matter how much money they spend, the bank can handle it…  Right…  They create paper to pay off the debts that they created with other paper, to pay off the debts that they created with other paper to pay off the debts…  ad infinitum.  This is a very sophisticated ponzi scheme that doesn’t even require other investors to pay off previous investors.  They just create more digital dollars…  a house of cards, and trust me folks, eventually it will fall.

The U.S. Is Not Too Big To Fail | The New Republic.

The absence of debate over war – Glenn Greenwald – Salon.com

Since the year of my birth, 1951, our nation has been in perpetual war.  Government uses this to grow itself, and increase its control over us, the people.  The founders feared standing armies, and they were right to do so.  As their experience with the european powers had shown them, war is  a noose around the peoples neck.

Read the article below for a critique of this point.

The absence of debate over war – Glenn Greenwald – Salon.com.

Danger in Numbers: The Decline of Paper Currency by Richard Daughty

Ahh, the Mogambu Guru!  No one says it with more panache tucked between the tongue and cheek.  As the European Central bank creates a trillion bucks out of thin air, and the Federal Reserve offers to back these notes…  Tell me is that not backing paper with paper?  Am I clueless here, or was this not sort of what happened when all those mortgage backed securities started toppling?  The government ponzi scheme goes on, and indeed I continue to see the end of the world as we know it.

Danger in Numbers: The Decline of Paper Currency by Richard Daughty.

Economic Implosion? or Go Long on Gold and Silver

As the sovereign debt crisis unravels in Europe, the dollar has seen a resurgence against foreign currencies.  Long perceived as a safe haven, the United States profits from European economic uncertainty, but how long can this last?

You’ve heard of Black Friday… Well now you’ve seen Souvlaki Thursday (the Greek Debt Crisis is making its presence felt in the international markets) With a drop in the Dow this past Thursday of almost 9.2% (though it did rebound to a 3.4% loss) the market has shown its fragility. 9.2% is not small potatoes folks, and I can assure you that the big boys in DC are running scared.

As previously mentioned, however, the dollar is remaining strong against other currencies, but not against gold and silver. These two metals continue to rise, or rather hold their own against an inflating currency.

Throughout the history of mankind, no (that means not one) fiat (by order of government) currency has survived. Why is this? Well, the reason is that governments who have the power to “make” (in our case print) money have never been able to restrain themselves. When they need more money for their wars or their social programs… well they just crank up the printing press. And by the way, the constitution gives the Federal Government the responsibility of coining money… not printing it.

Since the federal government went off the gold standard (starting first with the Breton Woods agreement in 1945 and ending in 1973 with Nixon’s repudiation of the gold standard) we have had a fiat system. In the past several years, the money supply has nearly doubled courtesy of Mr. Ben Bernake. This causes inflation.

Inflation is a concept that exists primarily in fiat money systems (and baloons, tires, etc.) Essentially this means more money chasing fewer goods. As a simple guy, I like to think of it using the Coke Index. When I was a child in the late fifties, I could buy a Coca Cola for 5 cents… That same Coke today costs me 20 times that much. This is not due to scarcity of Coca Cola… They make lots more than they did when I was a child. This is not due to increasing corporate profits. If you look at those in inflation adjusted dollars, it’s about the same. Nope, it’s due to the decreasing value of our fiat dollar caused by the rolling presses in DC. Rolling to fund their wars (spreading freedom? what hogwash), rolling to fund their social programs (helping to fund the needy? more hogwash… funding votes).

I am getting away from the thrust of this blog, though. What you saw thursday is a shift along the seismic crack that is the world economy.  When the fault line opens?…   All these riches based on a house of cards. What happens when one of the bottom cards is pulled out?

Gold and silver can help to protect you, my friends, from the economic unravelling that is currently in progress, and will continue to progress. I urge you to have a garage sale, get rid of the stuff that’s filling your basement… buy silver coins. The cash that’s in the bank… buy silver coins with it. Load up… protect your wealth… you’ll be glad you did.

IMF Survey: Government Borrowing Is Rising Risk to World Financial System

The IMF notes that though the most recent economic crisis has been averted by massive inflows of money from governments across the world, a sovereign debt crisis is currently looming.

Is the house of cards going to fall?  Hold on to your hats, folks.

IMF Survey: Government Borrowing Is Rising Risk to World Financial System.

Civil War, Civil Rights, and the Death of the Republic I

My mother recently sent me up several boxes of mementos from my childhood and young adulthood.  There were photos, concert tickets, yearbooks, wooden nickels and report cards.

My children, ages 15 and 18 took great pleasure in reading my teachers remarks regarding my behavior.  Words like undisciplined and troublemaker abounded.  Yet they appeared along with a few positive kernels such as my love for reading.  As I gazed at the photos and yearbook of my senior year in high school, I was struck by the hopefulness of my generation.  We had weathered the tumultuous sixties and not only survived, but had watched the promise of civil rights, not complete its fulfillment, but certainly move much further down the road.  We had hope for peace, love, and a better world, and we decried the “establishment.”

I knew four of my great-grandparents, and each of them had fathers that fought in the Civil War, two for the north, and two for the south.  Aside from the thirteenth amendment that freed the slaves, that war ended all discussion of where the true governmental power lay in this country… and that was Washington, D.C.

The Civil War was not so much about slavery as it was about disunion, about the right of States to be self-determinate, to be masters of their own political allegiance.  Slavery was the tinderbox that set afire the republican barn built by the founders.

My memories, my families collective memories span the time period of the last one hundred and fifty years of this country.  We have watched as the ravage of the civil war eventually led to the civil rights movement, and we are pleased by that.  After all, that is the promise of the Declaration of Independence, that “all men are created equal”.  A number of my forbears fought, and bled in the Revolution dedicated to the ideals expressed in that document.  This promise to “all men” is an important promise, and it is a great thing that it has been more fully realized.  The civil war gave us that gift, but it gave us much more as well.  Much more than for which we could have hoped or perhaps, even feared.

The war gave us the consolidation of Federal power at the expense of the states power, and that is a fearful thing.

I will continue this ramble next week.

An Economic “Tipping Point” or Go Long on Gold

The PIIGS (Portugal, Italy, Ireland, Greece, Spain) have sort of dropped out of the news lately, but not because they lack importance as indicators of the current global economic crisis.

Jean Claude Trichet, the European Central Bank President has remarked that:  “The International Monetary Fund or any other body must not assume the responsibility of Eurozone Governments in dealing with economic problems,”  He has also remarked that  “The Greeks are crooks, and they’ve been lying about the numbers.

The Greek government currently has as a debt load equal to 150% of GDP, or so they say.  Others believe that the actual number is much greater.  They are on the verge of financial collapse.  This creates significant problems within the EU.  The French are large holders of this debt, and want to see this crisis resolved in a fashion that does nothing to hurt them financially.  The Germans on the other hand, are ready and willing to cast off the Greeks and send them on another, and perhaps even more fearful and painful odyssey than that of which Homer wrote over two thousand years ago.

According to Philip Manduca, head of  investment at ECU Group, a financial group based in the UK that is primarily a trader in currency, “We are at a tipping point.”  A lack of fiscal unity in the Eurozone may very well implode the currency, unless… “someone else takes the spotlight, and that may be you (meaning the US).”

Right now, we are  funding our wars and our social programs through debt, but when other nations like China start worrying about our ability to repay,  US bond yields must start to climb as  the perception of risk increases.  Manduca argues that when this happens, and if equities start to fall… we have a real big Uh Oh!

Even with all the stimulus dollars applied, the US has seen only a .1% increase in real GDP, and the government, a large part of that picture, is an unproductive sector of the economy.  The job market is flat, and unemployment has not seen significant change.  On top of that we’ve got Obamacare coming and business in the US is already talking writedowns.  We’re talking a continuation of the “perfect storm” here folks.

So for the average guy, what’s the answer?  Metals, I’m thinking.  Gold and Silver.  Right now, I prefer silver, it’s cheaper, you can buy more of it, and there’s more room to run.  While gold might double in the next few years, silver could increase by a factor.

When I say to you that I don’t want to see this happen, I mean it, and I hope that it doesn’t, but I don’t see any other plausible  outcome.  As an individual, I can live beyond my means for only so long.  It is the same for government, and we have reached the “Tipping Point.”

Watch this video, only 8 minutes long.

ECU Group’s Philip Manduca “We Are At A Tipping Point” And The Only Thing That May Save The Euro Is A Collapse Of The US | zero hedge.

The ObamaCare Writedowns

The problem with socialism is that eventually you run out of other people’s money.

Margaret Thatcher

One of the simplest facts of  life is  “You don’t get something for nothing,” yet  the Democratic congress has assured us that with the new health care bill, we can insure 33 million Americans and not only will it not cost us anything, we  can actually save money in doing so.   Apparently the business sector does not believe this.

Just days after passage of Obamacare, some of the largest companies in the US are taking writedowns on their profit and loss statements.  In other words, they expect this bill to cost them lots of money.

Well, heck, you might say, the big companies make millions, even billions of dollars, right?  Who cares?  You should care.  When AT&T takes a writedown of one billion dollars, that’s a billion dollars they don’t have to invest in research and development, upgrading equipment, or expansion of their business.  That means jobs, baby, and because these companies are suddenly less profitable, they are less highly valued by the investing community, the result being a lower stock price.  If you are lucky enough to have a 401k plan, I hope you’re not holding them.

It has been said that “He governs best, who governs least.”  Our  federal government has lost sight of this.  The Republican form of government exemplified at this nation’s founding with a limited central government and strong states rights has been dying, at least since the end of the Civil War, and we need desperately to resuscitate it.  I believe the chance will come as our economic plight over the next ten years continues to worsen.  The failures of our mismanaged, over-bloated central government will become apparent, even to the most die-hard liberal wacko.

Read the article below, see what the business world thinks of Obamacare.

The ObamaCare Writedowns – WSJ.com.