by Kurt Nimmo

Protesters against Arizona’s new immigration law have held rallies at Union Square in New York and other places across the country.

If you cross the North Korean border illegally, you get 12 years hard labor.

If you cross the Iranian border illegally, you are detained indefinitely.

If you cross the Afghan border illegally, you get shot.

If you cross the Saudi Arabian border illegally, you will be jailed.

If you cross the Chinese border illegally, you may never be heard from again.

If you cross the Venezuelan border illegally, you will be branded a spy and your fate will be sealed.

If you cross the Mexican border illegally, you will be thrown into a political prison to rot.

If you cross the U.S. border illegally, you get:

1. A job
2. A Drivers license
3. A social security card
4. Welfare,
5. Food stamps
6. Credit cards
7. Subsidized rent or a loan to buy a house
8. Free education
9. Free health care
10. A lobbyist in Washington
11. Billions of dollars worth of public documents printed in your language
12. The right to carry your country’s flag while you protest that you don’t get enough respect.

Of course, North Korea, China, and the others are communist dictatorships, but the fact remains that our immigration policy is self-destructive. It encourages illegal immigration and the bankruptcy of the states. It also creates social and racial tensions.

Once upon a time, legal immigrants flocked to America to escape authoritarian government and persecution. The huddled masses cited on the Statue of Liberty were in search of liberty, independence, and prosperity.

Most illegal immigrants are not in search of liberty. They are looking for economic opportunity and in many instances the freebies handed out by the state at the expense of the producers.

No nation can survive with an unchecked and unrestrained tidal wave of poverty-stricken foreigners flowing over its borders.

Once upon a time, immigration policies ensured that immigrants arriving on our shores were not only free of disease, but had marketable skills and would not impose an economic burden on the country. Immigrants were expected to accept American culture and speak the language.

Now the exact opposite is the case.

“An autopsy of history would show that all great nations commit suicide,” wrote the famed British historian Arnold Toynbee. America — through its immigration and economic policies — is well on its way to committing suicide.

“The histories of bilingual and bi-cultural societies that do not assimilate are histories of turmoil, tension, and tragedy,” writes historical scholar Seymour Lipset.

Canada, Belgium, Malaysia, Lebanon have all faced crises of national existence as minorities have pushed for autonomy and independence. Pakistan and Cyprus have divided. France confronts recurring problems with Basques, Bretons, Corsicans, and most recently a growing Muslim minority that has resulted in violence.

“Globalization is defined by cross-border connectivity, including porous borders, which serve to expedite flows of goods while at the same time increase the level of immigration – both legal and illegal,” explains Paul A. Harris, Assistant Professor of Public Administration, International Studies and Philosophy at Augusta State University.

Former Colorado Governor Richard D. Lamm explains how the process of destroying America works. “Turn America into a bilingual or multi-lingual and bicultural country,” he says. “History shows that no nation can survive the tension, conflict, and antagonism of two or more competing languages and cultures. It is a blessing for an individual to be bilingual; however, it is a curse for a society to be bilingual.”

The most effective weapon in this process of destruction, Lamm explains, is multiculturalism — the demand that all arriving people retain their culture at the expense of the prevailing culture. “Without the dominance that once dictated ethnocentrically and what it meant to be an American, we are left with only tolerance and pluralism to hold us together,” writes Benjamin Schwarz.

Louis Beam writes:

In modern times multiculturalism is instituted from the top down as an elitist ruling class tool used to play one or more racial or ethnic groups against another

The ensuing cultural melee serves the political designs, economic goals and power needs of elitist rulers and their sponsors. This technique was developed by Marxist ideologues who used multiculturalism in Russia to divide and conquer resistance to the institution of a communist state.

The same internationalists that sponsored Lenin, Trotsky, and Stalin as the multicultural leaders of the Soviet state from their banking houses in New York, similarly sponsor the multicultural leaders of the United States, Canada, and Europe today.

Beam explains how an interlocking network of foundations such as Ford and Carnegie, international banking empires such as Rockefeller and Rothschild, and government agencies firmly in their control work in tandem with corporate media outlets such as the New York Times, CBS, and Hollywood, to promote, foster, and institute multiculturalism.

La Raza , Spanish for “The Race”, is an organization at the forefront of the effort to flood America with illegal immigrants and institute “amnesty,” is a creature of the Ford Foundation. La Raza is lavishly funded by the bankers at Citigroup and multinational corporations such as Wal-Mart. To date, the Ford Foundation has showered $12.9 million on the National Council of La Raza.

It is not coincidental the immigration issue has reached a breaking point at the same time as much of the world is wracked by economic crisis. In response to this manufactured crisis, the elite have called for “global governance” and a “unified global approach” to economic and social issues. Immigration is part of the effort to merge nations into a union.

In the streets of Los Angeles, New York, San Francisco and elsewhere, thousands of pro-illegal immigration demonstrators have called for “amnesty” and demanded the tidal wave of illegal immigrants continue it destructive course. Arizona’s attempt to control its border — in lieu of the federal government refusing to do so — is the lightning rod that has catapulted to the point of violence.

This is the beginning of national suicide, as Toynbee has suggested.

By Selwyn Duke for the American Thinker

If you thought that “one man, one vote” reflected the full flowering of representative democracy, think again. In the village of Port Chester, N.Y., just a few towns north of my locality in Westchester County, there is a new system. It’s “one (minority) man, six votes” — brought to us courtesy of the U.S. Department of Injustice and a lunkhead of a federal judge named Stephen Robinson.

Here’s the story: In 2006, the Injustice Department alleged that Port Chester’s election system was “unfair.” The problem? While the village is almost half Hispanic, no Hispanic had ever been elected as a trustee.

Now, how this hapless village got on the feds’ radar screen, I have no idea. Were Hispanics intimidated into avoiding the polls? Were there literacy tests? Poll taxes? No, this story will not inspire a movie by the name of Port Chester Burning. Instead, it seems the problem Uncle Scam had was that the town’s slim white majority — who turn out to vote in greater numbers than their Latino neighbors (Hispanics also account for only about 20 percent of Port Chester’s voting-age population), along with whatever Hispanics join them — have thus far chosen to elect only white candidates. That pesky majority rule can be a real bummer, can’t it?

So the Injustice Department — using our tax money — dragged Port Chester into court, which, presumably, cost the village tax money in litigation costs (ain’t being a civil rights lawyer grand?). It’s enough to make you wonder if the Injustice Department has too much time and money on its hands, except that it doesn’t seem to have time to tackle real voter intimidation. Remember that this is the bureaucracy that refused to pursue the case against the Black Panthers who tried to scare white voters away from a polling place in Philadelphia.

This brings us to Federal Judge Stephen Robinson. He ruled — get the Digitalis — that the village’s practice of having conventional at-large elections violated the Voting Rights Act. Now, let me put this in the simplest terms possible. The Voting Rights Act’s purpose was to ensure that everyone would have the opportunity to vote. Yet this “judge” decreed that “one man, one vote,” and the attendant majority rule, violate the act if they don’t yield a politically correct result.

And the kicker is Robinson’s remedy: He approved a plan to give every resident six votes, which they can apportion among the six trustees to be elected any way they wish. It’s known as “cumulative voting.” No, we’re not in Kansas anymore, Toto. Heck, I’m not even so sure we’re in America.

What’s the thinking? I suppose the idea is that many Hispanics will exhibit great ethnic patriotism and give all their votes to one Hispanic candidate, whereas whites don’t vote as a block to the extent other groups do. Perhaps we’re seeing an example of leftists nobly shouldering the Liberal White Man’s Burden.

Judge Robinson also ruled that Port Chester must allow residents to show up on any one of five days to cast ballots, a system called “in-person early voting.”

So first the left gave us quotas in schools and businesses, and now we have them in elections. I wonder, if there is a locality in which whites are almost half the population, with a black majority that has never elected a white candidate, will the feds roll into town and work the same voodoo? What if it’s an area that’s almost 50 percent female but that has never voted a woman into office? Maybe we should just mandate that public officials must reflect the demographic composition of their constituencies.

You could also say that this is the next step in the evolution of get-out-the-vote drives. It used to be that such endeavors were geared merely toward motivating the ignorant and apathetic to cast ballots, as we know that such people will make thoroughly stellar voting decisions if we can only somehow cajole them into the polling place. But this is so much simpler: Get out the vote by multiplying it. We don’t need dead people in Chicago anymore — we have deadheads in the Injustice Department.

Really, this scheme visited upon Port Chester is just another example of liberal bigotry. The leftist social engineers are again dividing people into groups, tacitly claiming that a person of one race cannot adequately represent a person of another, and changing the melting pot into a cauldron of ethnic tension.

So on Tuesday, June 15, there was an election in a village in New York. In preparation, the locality had six forums in English and six in Spanish to explain a new, federally mandated scheme to the voters. It created various ways of publicizing the election — with tote bags, lawn signs, and tee shirts stating “Your voice, your vote, your village”; and reminders in the form of TV spots, brochures, and handouts given to schoolchildren, in both English and Spanish — all of which had to be approved by the Department of Injustice. It also hired a “non-profit” election research and reform group called FairVote to provide consultation services (our tax money at work — again). And when it came time to cast the votes, “federal observers” were on site…watching.

The left is Balkanizing us. I just wonder what their quota prescription will be when it comes time to partition the nation.

by Bill Bonner

Sittin’ on the dock of the bay…
Watchin’ the tide roll away…

~ “(Sittin’ On) The Dock of the Bay,” Otis Reading

We’re glad we’re not sitting on the dock of the bay in Biloxi or St. Petersburg. There’s oil coming that way…and it’s not the kind you can burn in your lamp.

The newspapers say there are huge globs of oil beneath the surface…or floating on the top. You’d think you could just pump it up. At $70 a barrel, you’d think you could make money scooping up the “sea oil” in the gulf. Probably better than shrimping.

Instead, everyone is complaining about it…and threatening to put BP executives in jail. Yesterday’s cover story in The Financial Times told us that the head man at BP has admitted error.

“BP ‘not prepared’ for spill”

We hope he had a good talk with his lawyers. “Not prepared” sounds like an admission of negligence. Maybe criminal negligence.

There are billions in lawsuits coming up…and the attorneys around the Gulf are slicker than an oil spill. The English don’t realize what they’re up against…an Alabama lawyer in a seersucker suit…talking to an Alabama jury…about how a British billion-dollar company destroyed their lives and livelihood.

They’re going to use every word Tony Hayward says against him.

Nobody is going to thank him for keeping his auto running. No one is going to think about where the oil comes from that he uses to heat his house…or how he draws electricity from an oil-fired power plant. No one in the entire state of Alabama is going to stand up for BP…certainly not an elected official.

“You have no idea how this works,” said a Washington friend. “The shyster lawyers are all in tight with the lawmakers. Many of them are shysters too. That’s why Obamacare is so tilted towards the lawyers and the pharmaceutical companies. They’re all in cahoots.

“And now this oil spill is going to set off a feeding frenzy on BP. The shyster lawyers are drawing up their class action strategies now. And you’ll see public interest groups get into the action. These guys are smart. And they’re very well funded. They’re going to short BP shares…and then announce a $20 billion lawsuit. And every pseudo environmental group…and trade organization…and labor union…and city council…and cracker-jack collection of meddlers anywhere within 100 miles of the coast…they’re all going to be looking at that pay day…when BP settles for…what?…$100 million…$1 billion…who knows. But they can invest millions in the case, because they know the payoff will be huge. They’re just fighting for position now…seeing who can put together the winning jackpot case… It’s sickening.”

Legal advice to BP: deny everything. You weren’t there. Deepwater what? Then, tell litigants that you will never settle any case, no matter how big or how rich. That will vastly increase the investment capital the shysters need to raise.

BP’s share price has plummeted. Some people think it is time to buy. Might be a little too soon. Our guess is that estimates of the damage are going to balloon even higher as more and more lawyers begin to see that thanks to BP they can win the lottery without buying a ticket.

Also, we suspect that a downturn is coming in the entire energy sector. Why? Because energy use grows with GDP growth. And we suspect we’re in Deep Doo-Doo there too.

Savings rates are rising all over the world – in developed economies and in emerging economies. That means GDP growth should turn down.

From Yahoo Finance:

Americans pulled back on their spending in May after a tepid April, underscoring how fragile the consumer spending recovery remains, new data released Thursday show.

Cool weather and a quirk in the calendar – a late Memorial Day weekend that hurt May’s business but should boost June’s figures – dampened spending on almost everything from clothing to major appliances. The figures, from MasterCard Advisors’ SpendingPulse, include spending in all forms including cash from May 2 through Saturday.

But weakness in the past six weeks is due to more than thermostat and calendar flukes, analysts said. They cited unemployment, stock market jitters and the end of government funded rebates on energy-efficient appliances.

“I don’t think you can explain away all the weakness just based on the calendar shift,” said Michael McNamara, vice president of research and analysis for SpendingPulse.

People are reluctant to spend for all the usual reasons…and some new ones. In the past, people have feared losing jobs. Never before in recent history have they feared that the government would go broke.

Just ask young people what they expect to get from Social Security or the new Medicare program. They know the score. The old folks stacked the deck against them. All the aces come up first – while the boomers are still in the game. Then, nothing but low cards.

“‘Sittin’ on the dock of the bay’ was a protest song,” a communist friend once explained. “It’s about blacks who came to look for work in San Francisco and then couldn’t find a job.”

Maybe so.

Another report tells us that the corporate bond market is practically dead. Corporations can’t raise money for expansion…and don’t seem to want to. They’re being shut out of the credit market by government – particularly the US government. Bond rates are so low buyers don’t have much to look forward to – whether they buy the corporates or the Treasuries. They figure they might as well go for Treasuries. At least they’ll be sure to get paid back.

This year, the US government is expected to borrow an additional $3 trillion. That doesn’t leave much money for the private sector. Which is why The Wall Street Journal report is surely correct; more and more people are going to be sitting on the dock of the bay…or watching TV. Unemployment is still increasing in most cities.

China Daily seemed to capture the underlying trend better than anyone. It’s headline:

“West moving towards deeper financial abyss.”

Into the Deep Doo Doo, in other words.

by Gary North

On May 17, David Laws, the new British government’s Chief Secretary to the Treasury, walked into his office. There on the desk was a note from the previous holder of this high office, Liam Byrne, who had departed along with Gordon Brown’s Labour Party cabinet. The note was brief.

“Dear chief secretary, I’m afraid there is no money. Kind regards – and good luck! Liam.”

Mr. Laws was a bit miffed. He informed the media that it is traditional for an outgoing senior office holder to leave some guidelines for the incoming office holder. This note, Laws said, was not helpful.

On the contrary, it may have been the most helpful note left by an outgoing politician in modern history. It told the truth.

Mr. Byrne later told the media that it was a joke. “I do hope David Laws’s sense of humour wasn’t another casualty of the coalition deal.”

Ha, ha, ha. The joke was on Mr. Laws and the incoming government. There isn’t any money left. The government is running an enormous deficit. The money required to keep the government going will have to be borrowed, either from investors or from the Bank of England.

Mr. Laws was said to be up to the task. This glowing assessment appeared on the site of the Wall Street Journal, a media outlet always ready to believe that deficits don’t really matter, that a government can always dig itself out of a fiscal crisis. All it must do is raise taxes and cut spending. Of course, no government ever does the second. But the folks at the WSJ never are fazed by this invariable law of modern politics. We read of Mr. Laws:

Now he is central to the coalition’s plans and must handle much of the most difficult work. He will have to get used to becoming very unpopular with a significant chunk of the electorate and parts of the commentariat. He will be presented as Mr. Cuts, which the Tory high command clearly thinks is good for its prospects. In theory, Laws will take all the flak for Osborne.

Ah, yes: Mr. Cuts. There will be lots of cuts. There will be a slice-and-dice cost-cutting regime, despite the fact that it is a divided British government in which the Conservative Party could not win a majority.

Laws looks like he realizes all this and is impressively unfazed. He has a job to get on with, as Gordon Brown would say. But it’s a very different task to that undertaken by the former PM. The Lib Dem Laws is on a mission to put the Gladstonian liberal approach – of sound money and low taxation when possible – back into operation.

Said his colleague and friend Malcolm Bruce to Allegra Stratton: “Laws is an unreconstructed 19th-century Liberal…. He believes in free trade and small government. Government should do the job only government can do. There’s no point in having a large public sector if the users of the public services are getting poorer. But he specifically made the point in the house [on Wednesday] that his economic liberalism is tempered by his social liberalism.”

Yes, my friends, there is a New Era coming in Great Britain – a new era of Gladstonian cuts. Yes, it is also true that the Conservatives ran Disraeli against Gladstone, because they could not tolerate his free trade, low-taxes policies. But all this has changed. It’s a New Era.

His agenda has the potential to be quite revolutionary in its effects, if he is not blown over by a hurricane of protest or events unforeseen. But it also might catch on, and make Laws very popular indeed. He has barely been in office for two weeks but the words “potential future prime minister” don’t sound entirely silly.

That was published on the morning of May 28. By the afternoon, Laws had resigned. A hurricane had hit. It seems that he has been a closet homosexual. That was acceptable to the media, but the closet had been in the form of a $1,200/month apartment rented – at government expense – from his partner of nine years. After 2006, this was illegal by government law. Mr. Laws promised to repay $60,000 in subsidies, but it was too late. The 2009 scandal of Members of Parliament who had taken government money to pay for their non-government-related expenses is too fresh in the minds of politicians and voters. Laws resigned.

His immediate replacement was exposed two days later as having avoided paying capital gains taxes on a similarly subsidized residence. It was legal, because of an anomaly in the tax code, but it was one more reminder to the voting public that the politicians have effectively gamed the system to avoid the burdens that the system has imposed on voters. This has been true of political life for several millennia, but the public never seems to catch on.

We see Punch and Judy battling it out again for the right to swindle the public one more time.

BUT WHERE WILL THEY GET THE MONEY?

Maybe you have seen the videos by Clarke and Dawe, the Australian comedians. If not, you really should. They are funnier than much Liam Byrne.

Mr. Byrne warned Mr. Laws that the country was out of money. Mr. Laws had insufficient time to solve this problem. His replacement now inherits the problem. It is the problem facing all of Europe.

It is also facing U.S. banks, mainly the largest ones. They have purchased an estimated trillion dollars in bonds issued by European nations. A series of defaults would call these assets into question. This is why the Northern European politicians are frantically borrowing money from investors to cover the losses that Southern European nations have produced.

There is no possible way that Southern European nations will ever pay off these debts. Modern finance theory assumes that debts of sovereign nations will never be paid off, for these debts have in part been monetized. If they are all paid off, this will force central banks to monetize other assets. Otherwise, the central banks would have to shrink their monetary bases back to whatever gold they still have, assuming they have any, since most of their gold holdings have been leased to bullion banks, which then sold the gold to buy government bonds.

Follow the money, advised Deep Throat in the screenplay of All The President’s Men. No one can actually follow the money. The debts and cross-debts are too large and too complex. Add to this at least $600 trillion worth of derivatives, which are mostly based on the interest and market value of bonds, and the central bankers have a very big problem facing them.

So, the squandering governments in Northern Europe have pledged about a trillion dollars’ worth of bailout money for the even more wasteful governments of Southern Europe. Everyone knows there will be some sort of default, but they do not expect this in the near term. It will be later. How much later? No one knows and no one cares. Until then, investors lend money to governments that will surely default. This is the foundation of international finance. It is also the basis of Social Security, Medicare, Federal pensions, and the municipal bond markets.

Most voters don’t know and don’t care. Politicians do know but don’t care. There are no negative sanctions for continuing to pooh-pooh the inescapable reality of the unfunded liabilities of all Western governments. There are instant negative sanctions for any politician who admits the truth and publicly calls for the immediate reform and partial default of these programs. No one in the electorate wants to face the truth: either granny will get stiffed near-term or the working-age voters will get stiffed long-term. Voters want to delay the cuts now, on the assumption that the can will be kicked down the road indefinitely. They discount the inevitable future for the sake of present bailouts.

This mentality subsidizes the expansion of private lending to governments. This is why the United States government can borrow for ten years at a rate below 4%. This is why capital is pulled out of the private sector in order to fund the delay of the inevitable bankruptcy of Western governments.

ASSETS WITHOUT LIABILITIES

The voters believe that there is no connection to the liability side of citizenship. They believe fervently in the asset side of citizenship. They do not believe that the bills will ever come due for them. They believe fervently that they are entitled to every dime already promised, plus whatever more they can get Congress to enact.

They vote for their beliefs. They vote only for politicians who insist that the liability side of citizenship can be deferred or transferred to others. They vote only for politicians who promise that the asset side of citizenship will increase. Every politician knows this.

Liabilities and assets must match on every balance sheet. The government’s balance sheet is the reverse of the citizenry’s. Every asset possessed by a citizen is a liability to the government. Every liability must be matched by an asset. What is this asset? Future government income. Where will this come from? From taxes, from borrowing, and from borrowing from the central bank (inflation).

Citizens believe only in the asset side of their balance sheets. The assets – promised future income – must not be offset by liabilities: future taxes, including the inflation tax. The politicians encourage this belief. They vote ever-increasing assets based on future government income, but they refuse to tell voters about the size of these liabilities. They pretend that an off-budget liability is not really a liability. After all, this is what the government’s own ledgers show.

The liabilities of the voters – the trust funds full of IOU’s from the government on behalf of the citizenry – are counted as assets of the Social Security and Medicare systems. When anyone raises a question regarding the future source of the future funding of these assets – the general fund – he is dismissed as a crackpot, a Tea Party voter.

For voters, the trust funds’ IOU’s are all assets, not liabilities. For politicians, the same is true. The trust funds’ IOUs from the government are assets politically, because the vast majority of voters believe that the trust funds’ assets are not legal claims on their future income. The assets are future claims on someone else’s future income, not theirs. “Don’t tax you. Don’t tax me. Tax the guy behind the tree.”

The accounting charade is promoted by the Congressional Budget Office. The CBO lies in the early part of this paragraph, but tells the truth in the sentence beginning with “If intragovernmental transfers. . . .”

According to CBO’s current baseline projection, trust funds as a group are expected to run a surplus of $119 billion in 2010 and $1.6 trillion from 2011 through 2020 (see Table D-1).That surplus is bolstered by interest and other sums transferred from elsewhere in the budget. Such intragovernmental transfers, which are projected to total $590 billion in 2010, reallocate costs from one category of the budget to another but do not directly change the total deficit or the government’s borrowing needs.

If intragovernmental transfers are excluded and only income from sources outside the government is counted, the trust funds as a whole are projected to run annual deficits that will increase from $471 billion in 2010 to $907 billion in 2020.

It plays the same game of deception in the next paragraph, which deals specifically with Social Security. The truth is revealed in the sentence beginning with “Excluding interest. . . .”

Total trust fund surpluses are dominated by those for the Old-Age and Survivors Insurance portion of the Social Security program. Including interest and other intragovernmental payments, CBO estimates a surplus of $110 billion for that fund this year and a cumulative surplus of nearly $1.5 trillion from 2011 through 2020.

The DI program is projected to run annual deficits through the entire projection period. For Social Security as a whole, the estimated surpluses peak at $139 billion in 2015 and decline to $107 billion in 2020. Excluding interest (which accounts for the bulk of the intragovernmental transfer), surpluses for Social Security become deficits of $28 billion in 2010 and $202 billion over the period from 2011 to 2020 (see Figure D-1).

The politicians know that most voters will never see this report. So, they emphasize the early portion of each paragraph. They quote other official documents that reinforce this systematic deception.

The voters refuse to hear any other version. They plug their ears to anyone who comes with the message of the second part of these paragraphs.

The politicians tell voters that the government has assets without liabilities. The voters believe that they also possess assets without liabilities. Yet every government promise that voters regard as an asset is in fact a liability. It is deliberately concealed by the government. The voters like it this way. They will vote out of office any politician who dares challenge this deception as an outright fraud. The voters delight in the fraud. Why? Because it shields them from this question:

“BUT WHERE WILL I GET THE MONEY?”

As surely as departing Chief Secretary to the Treasury warned “There is no money,” so are the trust funds of the United States government. Social Security will run a deficit this year. Medicare has been running one for at least two years.

The dreams of millions of voters will be shattered by this reality: “There is no money.” These dreams will be shattered in one of two ways: open default or mass inflation followed by hyperinflation. In the second case, “There is no money” will not literally be true. What will be true is this: “There is no money with 2010′s purchasing power.”

The voters will be at an age where they cannot easily rebound. But they will be able to vote. This is why, at some point, the electorate will have to decide: outright default to the coming generation of oldsters – an ever-increasing age to receive benefits – or else an outright default to richer oldsters: a means test for receiving payments. Richer people will not be paid. I think the second option is likely before the implementation of the first.

There will be increasing price inflation before the day of reckoning hits, for the Federal Reserve will buy the government’s debt. But, at some point, the default must be open if the dollar is to be saved. Otherwise, hyperinflation at rates above 40% per annum will destroy the capital markets.

CONCLUSION

You must decide. Which default is most likely? When is it likely? When will I be affected? Then you must take expensive steps to prepare for the scenario you select as most likely. If you continue to act as if there will be no day of reckoning, you will find yourself unprepared for that day.

If you sit there and do nothing, you will at some point face this reality: “There is no money.”

by Megan McArdle

Like many of you, I’ve been (privately) making fun of the strain of thought that Barack Obama is a Bad President because he isn’t Doing Something!!!! About the BP Oil Spill!

I’ve been laughing even harder at those who acknowledge that he maybe can’t personally pilot a top secret experimental navy sub down to the well and close it himself (a la Bill Pullman in Independence Day), but castigate him anyway for not showing us that he “gets it”–it being the scope of the disaster, the deep moral seriousness of the crisis. Presumably, this would all be much easier to take if the president were openly panicking. Or something. The Care Bear Stare Model of American Politics once again rears its ugly head.

However, a friend writes that there might be something the President could and should do:

My father, who has worked in the petrochemical industry for decades, tells me that there is a well-established method for dealing with a problem like this: blowing up the well. It’s been done before, successfully. So why isn’t this option being actively considered, despite the failure of every method tried so far? Because when a well is blown up, it can’t ever be used again. As a result, BP stands to lose a lot from doing so. And they probably won’t have to pay for all the harm done by the oil spill. (Did you know the Exxon Valdez legal case just ended recently, after Exxon fought to keep every penny it could for years on end?)

So in a case like this, it seems like there’s a good argument for the president stepping in. BP has a poor incentive to do the right thing here. Now, it might be true — as Obama has said — that the government lacks the expertise and equipment to cap a well. But (a) capping a well and blowing it up aren’t the same thing, and (b) if blowing it up requires expertise the government lacks, they could just hire the experts from (say) other oil companies.

As for whether the government has the authority to step in, I think the answer is yes. There is an *ongoing* threat to property throughout the Gulf region, and the protection of property is well within what I consider proper government
action. Also, the seabed is not owned by BP — it’s property of the government, leased out to BP (or so I understand).

As I told my father, I don’t know enough about the risks of exploding a well to know for sure that it’s the best decision. For all I know, there’s a chance it would make the problem even worse. But it doesn’t seem like BP’s incentives are properly aligned for them to give it the proper consideration.

Unlike many in the blogosphere, I did not have enough boxtops to get my Petrochemical Marine Engineer Secret Decoder Ring, so I cannot weigh in on whether or not this is a good idea.

But if it is an idea that should be on the table, then I quite agree that the President–or rather, experts in his administration–should step in and make that decision. I’m pretty fond of America’s modern, fossil-fuel based economy, but I’m pretty sure it can survive the loss of one well. BP is undoubtedly willing to cost the rest of the country a near infinite sum to preserve its future profits. But in a case like this, with an enormous and crystal-clear negative externality being imposed on the rest of the country (and a large swathe of marine life), they shouldn’t have the power to make that decision.

From TheAtlantic – shaping the national debate on the most critical issues of our times, from politics, business, and the economy, to technology, arts, and culture.

by Chuck Norris

Cursing, spitting, shoving, vandalism and death threats are pervading the political landscape. But who will relieve America of its political indigestion and anger?

I’ve seen a dozen U.S. presidents during my lifetime, but rarely have I seen the type of frustration and disdain being shown by many Americans in the first year of this presidency. And rather than seek to simmer that national heat, the president himself continues to taunt, demonize and socially quarantine opposition.

Why are Americans so frustrated? Not merely because of petty partisan politics. And not even solely because of the ginormous health-care bill that will costs taxpayers trillions. I believe the majority are disappointed with Washington because they voted for change, but are getting more of the same: more big government, more bureaucratic bullying, more overreaching federal intrusion and control, more pet projects, more taxes, more national debt, etc.

What’s so disheartening about America’s present political environment is that those in Washington are truly convinced that more and bigger government is America’s primary solution for recovery, future growth and security. President Obama even declared early in his presidency that “only government” is our savior.

Our founders had a far better solution than government. And it’s probably a good time, during this peak of citizens’ frustration (and also being Christendom’s Holy Week), to remind Americans that, though our founders initiated our government, they didn’t expect it to usher in any form of utopia. As proud as they were about their republic, their hope was not in government, but in God. For what? Most of the things that people today often look to government for: life, liberty, happiness, salvation, decency, civility, morality, honesty, restraint, equity of power and future hope, to name a few. Tragically, government has usurped God’s role in our republic and Americans’ lives.

The best tea-party signs ever — compiled in a striking book with foreword by Chuck Norris: “Don’t Tread on US! Signs of a 21st Century Political Awakening”

David Kupelian, in his new insightful treatise on what truly lurks behind the troubles in government and America, “How Evil Works,” notes that we’ve been “seduced” to believe that “‘the self-evident truths’ the founders relied upon are just outdated and dangerous myths.” “No wonder,” Kupelian says, “millions of Americans have gradually been demoralized into depending upon government to solve all of their problems, fueling today’s uncontrolled, cancer-like growth in government.”

But if our government and even public schools won’t remind Americans of our godly heritage (and hence the way out of this national mess), who will? The answer: we patriots. The least we can do is to remember and recall to others the Creator’s place in our republic, in hope of reawakening just one more American, especially during this Easter week.

It is no coincidence that the Declaration of Independence begins with a spiritual emphasis:

When, in the course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume, among the powers of the earth, the separate and equal station to which the laws of nature and of nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the Separation. We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty, and the pursuit of happiness – that to secure these rights, governments are instituted among men.

For America’s founders, God and government were intricately linked. As Thomas Paine echoed one year earlier, in 1775, “Spiritual freedom is the root of political freedom. … As the union between spiritual freedom and political liberty seems nearly inseparable, it is our duty to defend both” (“Thoughts on Defensive War”).

For even the framers of our Constitution, which is often hailed by critics as godless, God was behind its monumental words. James Madison spoke for most, when he said, “It is impossible for the man of pious reflection not to perceive in it [the Constitution] a finger of that Almighty hand which has been so frequently and signally extended to our relief in the critical stages of the revolution” (“Federalist No. 37″).

To our founders, God was the source of our human rights, which put limits on government power. Most of all, God was (and should be) the ultimate agent for national renewal. We are dreaming if we think we can correct the ills in ourselves, our government or our society without His aid.

Ben Franklin was particularly eloquent on this very point, as he addressed those who attended the Constitutional Convention:

In the beginning of the contest with Britain, when we were sensible of danger, we had daily prayers in this room for the divine protection. Our prayers, Sir, were heard; and they were graciously answered. All of us, who were engaged in the struggle, must have observed frequent instances of a superintending Providence in our favor. To that kind Providence we owe this happy opportunity of consulting in peace on the means of establishing our future national felicity. And have we now forgotten that powerful friend? Or do we imagine we no longer need its assistance? I have lived, Sir, a long time; and the longer I live, the more convincing proofs I see of this truth, That God governs in the affairs of men. And if a sparrow cannot fall to the ground without his notice, is it probable that an empire can rise without his aid? (“Memoirs of the Life and Writings of Benjamin Franklin,” p. 389)

Those are the questions not only every politician must answer, but every American, who is trying to resurrect a broken life, marriage, family, home or country: “And have we now forgotten that powerful friend? Or do we imagine we no longer need its assistance? … And if a sparrow cannot fall to the ground without his notice, is it probable that an empire can rise without his aid?”

If Franklin, a presumed deist, could believe that “God governs in the affairs of men,” it is certain that all or nearly all of the Founding Fathers did as well. That belief shaped our country, it is part of our heritage, and I do not believe that we can neglect or repudiate that belief – that we are responsible to God – without endangering our future. As Franklin declared, the American empire cannot rise or resurrect without his aid. That is also why an entire chapter in my new paperback expanded version of “Black Belt Patriotism” is devoted to the role God played in the founding of our republic and must play in America’s reawakening.

Friends, I am a patriot and an optimist at heart. I, as with many of you, believe that we can become a great nation again, known more for who we are than what we have. I believe in the resurrection of America. But that’s not going to happen by traveling down the same road we’ve been on.

If America has lost its way, its heart, its moral compass, the answer is to return to the old path, the path followed by our founders who put God first, trusting in Him – not big government – to be our salvation. In fact, the most important action you and I can take is to do that in our own lives: to put God first and raise up a new generation of decent, law-abiding, people-loving and God-fearing citizens.

That is why John Witherspoon, a founder and signer of the Declaration of Independence, urged Americans: “He is the best friend to American liberty, who is most sincere and active in promoting true and undefiled religion, and who set himself with the greatest firmness to bear down on profanity and immorality of every kind. Whoever is an avowed enemy of God, I scruple not to call him an enemy to his country.”

When human government seems lost and without hope, let us not only remember that we the people have the power to make changes in government, but, mostly, that our hope is ultimately not in men or government. It is in God and his future government, upon whose throne will be a crucified and risen Messiah, and about whom the prophecy was given: “Of the increase of His government and peace there will be no end. He will reign on the throne and over his kingdom, establishing and upholding it with justice and righteousness from that time on and forever” (Isaiah 9:7).

No wonder the term gospel means “good news.”

by Bill Bonner

The French media reports the passage of the health care reform bill as though it were the Emancipation Proclamation. Now, Americans have finally entered the modern world, they seem to say. Now, Americans have access to health care as a matter of right.

We’re suspicious of anything the French papers think is a good idea; they’re as bad as The New York Times.

That people think they have a “right” to health care just goes to show how little people think at all. “Rights” only make sense when they can be applied universally, without causing a “wrong” to someone else. You can have a right to own property, for example, because everyone can enjoy the right under the same terms and conditions. You can have a right to say what you like too…as long as everyone can say what he likes. But if you have the right to a cat scan, someone must have an obligation to make the machine…to put it in service…to run it…to maintain it…to offer it to you…and to interpret the results, etc. Who is this poor slave who has been shackled to your service?

According to the advertising, the health care bill is supposed to work miracles. It is supposed to reduce businesses’ health care costs, reduce the federal deficit, and lower insurance premiums. Of course, it will do none of those things.

“Now we’re really screwed,” says Jules, 22. “All you baby boomers are going to get more health care freebies and my generation is going to have to pay for it. Not only that, I’m going to have to buy health care insurance for myself.

“And the country is going down the tubes, too. It’s going to be just like every other government boondoggle program. It’s going to cost a fortune and make things worse. You know, I can’t believe they passed that bill. It was outrageous. They bribed everyone to get the bill passed. And even then, they couldn’t get Republicans to vote for it.”

France has a system of public health care that seems to work fairly well. On the two occasions when we’ve needed it…we found it efficient and dignified. One time, we were taken to the hospital in an ambulance; the local doctor thought we were having a seizure, a stroke or a brain tumor. It turned out to be an inner ear infection…but the service was good. No waiting. No problems. We were given tests…and it went away. Another time, Edward’s front teeth were knocked out in an accident while playing with the boy next door… He was rushed to hospital where the teeth were surgically re-implanted. Again, everything went well.

But France is not the USA and the French system is not at all what the Obama team has come up with.

The French system works as well as it does because the French are very critical, intolerant and demanding…of themselves as well as each other. At least, they used to be…

It is still rare to see a very fat person in France. People are expected to take care of themselves. They are expected to eat properly. Unlike the English, they do not drink to excess. And unlike Americans, they do not shoot each other on street corners. The concept of behaving “correctly” applies to ones’ health as well as to everything else. People are expected to act correctly – that is, in ways that do not put too much strain on the public health system.

What’s more, there is little ambulance-chasing by lawyers in France. Doctors and hospitals do not live in fear of lawsuits…and, in our experience, pharmacists give out advice, and medications, fairly freely.

Regards,

Bill Bonner
for The Daily Reckoning

by C.J. Maloney

Let us make one thing crystal clear: We do not claim the right to indiscriminate violence. We seek no bloodbath…

~ Black Panther Party (March 23, 1968)

One of the benefits of writing for this website is the mail you receive. After enough time you get a rather good feel for the type of person, on average, that frequents this place. The kind invitations I received after my last submission to grab my AK, run to the mountains, and join the fun when it all falls apart was telling. If the rebellious spirit of our Founders still lives at all, it seems to be concentrated between two groups – libertarians and punks. But, while the spirit may reside, would it be a good idea to act on it?

The right to rebellion is sacrosanct in America, the completely humane, just, and natural right of any man to break bonds with another is embodied not only in our very Founding but in our divorce laws, too. No American would consent to law making marriage an indivisible, eternal commitment; we refuse any compulsion to remain wedded to the girl of our nightmares, let alone the likes of Hillary Clinton and John McCain. Anyone who questions the right of divorce and (if made necessary by the political elite) violent action to secure it is, like the pro-slavery proponents of the Old South, seriously deficient in humanity.

Any discussion regarding the dissolution of political bonds belongs to, and only to, the working masses. Naturally, the opinion of any politician regarding this question may be completely discounted. First off, it is none of their business; servants do not determine the length of their employment. Second, addiction to power is in their very nature; it is the be all and end all of their existence. To expect an Obama or a W (or any of their species) to allow the working masses their right to peaceful separation is like expecting a hungry lion to spit out the wounded zebra it has clutched in its jaws.

It takes a statesman, a philosopher king, so to speak, to understand the benefits and justice of liberty, to understand that everywhere and always the struggle for it is the struggle of the workers against the political elite. A true statesman must be a traitor to his class, to be part of what the great Karl Marx promised, “a small section of the ruling class (which) cuts itself adrift, and joins the revolutionary class.”

Today, almost without exception, America’s ruling caste is bereft of such men.

The Write Way Towards Freedom

…Any change remains possible because citizens are free to communicate with and persuade one another and express their political opinions without being threatened by the Government with criminal sanctions.

~ Glenn Greenwald, Salon.com (March 22, 2010)

The best example of such a statesman is Thomas Jefferson, without doubt the most radical and progressive of the Founders, a man who, unlike even so many of his contemporaries, not only supported the idea of rebellion but also positively encouraged it. This was, and is, in stark contrast to power-mad figures like Alexander Hamilton and Che Guevara, men who are called “revolutionaries” but were nothing of the sort, who as soon struck off the chains of one tyrant went immediately to pot and looked about in a panic for a new set to clamp round their neck.

Jefferson, in contrast, was a true revolutionary, it was a subject he lived and studied his entire life. He believed that while war may be required to get out from under oppressive regimes, it is first of all necessary to have the proper, rational animating idea behind it, to make more likely the rebellion will be a positive step towards liberty rather than what so many revolutions sadly turn out to be; foolish, reactionary steps back into greater political control. Thomas Jefferson’s ideas culminated in the bloodless “Revolution of 1800,” when he took the presidency and firmly established, for a few years at least, an Executive Branch with a decidedly progressive, radical attitude towards power. This was accomplished not by war, but by the spread of ideas, something done best by, in Thomas Jefferson’s words, “the vast dissemination of books.” Political leaders burn and ban books for a reason.

Always it is a nation’s intellectuals, those who actually read and write the books, who spread the ideas vital to the advance and preservation of liberty. It is telling that while the ideological views put forth in best-sellers such as Edward Kennedy’s True Compass, Sarah Palin’s Going Rogue, and Barack Obama’s Audacity of Hope are not what progressive revolutions are made of, they are today as “mainstream” and apple pie as can be. Consequentially, a revolution today would be a decided step back as it would lack the ideological roadmap to go anywhere but deeper into the badlands.

If this union is to return to its progressive roots it will be not by the sword but by the writings of those dedicated to a philosophy of liberation, by the wide dissemination of radical thought into the op-ed pages and editorials of our newspapers, into the comments section to Internet news sites, into the mouths of the interviewed “man on the street,” into the intellectuals’ monthly journals and thence most importantly, into the minds of men. It is here where even the most humble advocate of liberty can make a difference, it is the necessary first step that, should we fail to take it, will bring any hard-earned advances to naught.

Pick up your pen and write until your fingers go numb, submit an avalanche, cross you fingers, and hope for the best. That is the one and only way to pull out of this tailspin. Patience and endless repetition, above all, are needed. Keep in mind the words of Rexford Tugwell (one of the more reactionary and conservative of FDR’s “Brain Trust”) that “a nation does not take a new direction overnight.” (Tugwell, 105) Remember that for decades FDR and his fellows wandered in the intellectual wilderness, yet steadily chipped away at the edifice of law, using small, but friendly, publications such as The Review of Reviews and The New Republic as their base of operations.

At this point in time, the average American citizen neither understands nor desires liberty. Today, even in the unlikely event of victory on the battlefield for the forces of liberty, it would all quickly amount to nothing. Freedom is impossible to force onto a people, and we would soon find, as even did God with the rebellious angels He cast out of heaven, that he “who overcomes by force, hath overcome but half his foe.” (Milton, 32)

So leave your AK hanging over the fireplace, it is not time for that.

Divorce Court

We hold these truths to be self-evident…that whenever any form of government becomes destructive…it is the right of the people to alter or to abolish it.

~ Declaration of Independence (1776)

As an alternative to open rebellion, some raise the age-old question of secession, seeing the federal behemoth broken up by a peaceful, democratic process. Should anyone think those people in D.C. will simply let the workers go free, as if Pharaoh will give Moses and the Israelites (after a hardy clap on the back and a best of luck) leave to walk away into the desert, a quick trip to any library’s history section should quickly end their delusion.

While Gandhi and Martin Luther King, Jr. effectively practiced passive resistance this, too, is no means to bring about peaceful change as the political mind is, above all, exceedingly prone to violence. It was once written of Europe’s rulers “these were fierce and lawless…war was the business and delight of their existence” (Mackay, 293) and pick up today’s papers and see, is the American politician any different?

Judging by their past and current behavior, from the War of Terror to that on drugs, or obesity, or smutty television shows, America’s ruling class look for any excuse to call out an army, be it of soldiers, police, or bureaucrats. Goading a political beast as highly militarized as the US federal government, even by use of a vote to secede or a simple, peaceful course of civic disobedience is to guarantee bloodshed. While Lincoln most certainly did not put to rest the question of the right to secede, he most certainly did put to rest any question of how America’s political elite will react to any sign of it. Forget “In God We Trust,” it’d be better that every US dollar bear a more accurate slogan for our current regime. “If I Can’t Have You, Nobody Will.”

So vote to secede or not, engage in peaceful resistance or not, if you want out of America you are going to have to fight your way out, and as of this moment we are not ideologically prepared for that struggle. Years after the glory of 1776, John Adams reminisced to Thomas Jefferson about what, more than anything, allowed such a progressive victory to be gained. He dismissed the actual fighting as of no import to the revolution, “it was only an effect and consequence of it,” meaning the true revolution takes place in the minds of men before you can have any hope of success, before any rifle is loaded. “The Revolution,” Mr. Adams went on to say, “was in the minds of the people, and this was effected…before a drop of blood was shed at Lexington.” (Bailyn, 1)

Before America can be liberated, she must first desire it.

A Change Is Gonna Come

If (a revolution) happens, I expect it will more closely resemble the French Revolution than the one in 1776.”

~ Wendy McElroy (2010)

Today, give me liberty or give me death no longer rings true, the typical American is content to put up with any outrage because he’s so ideologically stripped as to no longer have any idea he should be outraged. Harboring a completely materialistic view of politics that equates material comfort with freedom, he’ll bear any assault on liberty with timid submission so long as the hi-def cable stays on. The intellectuals fare no better in this regard, as they are the very ones who spread the ideas that made hi-def cable more important to us than trial by jury.

In the event of rebellion, the American people would lack any leadership with the ability, or even the urge, to guide them back to liberty. Even if the occasional outrage morphs into a tea party, the vast majority of Americans, lead by the intellectuals, take most assaults with quiet approval, and for now I thank God for it. To go to war is something even the most ignorant savage does with relish; but to start a revolution requires the ability for calm, rational thought and a manly courage to risk it all that does not currently exist in this country. Where once our forefathers shot at government troops marching through the Massachusetts countryside towards Lexington and Concord, today we are a frightened little flock that goes to pieces at the thought of Goldman Sachs suffering a well-deserved bankruptcy. 2010 America does not possess what successful revolutions are made of.

So, thank you all who sent me a kind invitation to share a mess kit and a fight, but when you Thomas Jefferson wannabes grab your AK-47s, pull on your surplus camouflage uniforms, and go rushing off into the mountains please count me out and don’t wait up. I’ll be watching the slaughter from afar, Barcelona perhaps, Amsterdam more likely, and doubtless I’ll wish good luck and God speed to you all.

As of right now this country is simply not prepared for secession, civic disobedience, or rebellion; and under the current regime they all would be considered the same in the eyes of the ruling elite. Any move in that direction would be setting you up for a hopeless task; to free a people that neither wish for liberty or could handle it if won.

Read the op-ed pages and editorials of any newspaper, glance at the comments section to any Internet news site, and listen to the interviewed “man on the street,” read our intellectuals’ monthly journals and agree; modern America is too uncivilized and savage for freedom.

If you wish for a change back to liberty, forget your rifle – grab your pen.

Selected Readings

Bailyn, Bernard. The Ideological Origins of the American Revolution (Harvard University Press, Cambridge, MA, 1967)

Milton, John. Paradise Lost (Barnes & Noble Classics, New York, 2004)

Tugwell, Rexford. The Battle for Democracy (Greenwood Press, New York, 1969)

by Ron Paul

With passage of last week’s bill, the American people are now the unhappy recipients of Washington’s disastrous prescription for healthcare “reform.” Congressional leaders relied on highly dubious budget predictions, faulty market assumptions, and outright fantasy to convince a slim majority that this major expansion of government somehow will reduce federal spending. This legislation is just the next step towards universal, single payer healthcare, which many see as a human right. Of course, this “right” must be produced by the labor of other people, meaning theft and coercion by government is necessary to produce and distribute it.

Those who understand Austrian economic theory know that this new model of healthcare will cause major problems down the road, as it has in every nation that ignores economic realities. The more government involves itself in medicine, the worse healthcare will get: quality of care will diminish as the system struggles to contain rising costs, while shortages and long waiting times for treatment will become more and more commonplace.

Consider what would happen if car insurance worked the way health insurance does. What if it was determined that gasoline was a right, and should be covered by your car insurance policy? Perhaps every gas station would have to hire a small army of bureaucrats to file reimbursement claims to insurance companies for every tank of gas sold! What would that kind of system do to the costs of running a gas station? How would that affect the prices of both gasoline and car insurance? Yet this is exactly the type of system Congress is now expanding in health insurance. In a free market system, health insurance would serve as true insurance against serious injuries or illness, not as a convoluted system of third party payments for routine doctor visits and every minor illness.

While proponents of this reform continue to defy all logic and reason by claiming it will save money, I worry about cataclysmic economic events. Already investors are more reluctant to buy US Treasuries, fearing that the healthcare bill, along with other spending, will cause government debt to explode to default levels. I had the opportunity last week to address my concerns with both Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke, especially about the potential for the coming serious inflation. I am not optimistic that these important decision makers truly understand what is coming, why it is coming, and how best to deal with it.

The Federal Reserve finds itself in an unprecedented and unenviable position. To keep up with government spending and corporate irresponsibility, it has increased the monetary base by nearly $1.5 trillion since September of 2008. Excess bank reserves remain at historically high levels, and the Fed’s balance sheet has ballooned to over $2 trillion. If the Fed pulls this excess liquidity out of the system, it risks collapsing banks that rely on the newly created money. However, if the Fed fails to pull this excess liquidity out of the system we risk tipping into hyperinflation. This is where central banking inevitably has led us.

The idea that a handful of brilliant minds can somehow steer an economy is fatal to economic growth and stability. The Soviet Union’s economy failed because of its central economic planning, and the U.S. economy will suffer the same fate if we continue down the path toward more centralized control. We need to bring back sound money and free markets- yes, even in healthcare- if we hope to soften the economic blows coming our way.

Audio Transcript:

By Peter Schiff

In his latest weekly New York Times column, Nobel Prize-winning economist Paul Krugman put forward arguments that were so nonsensical that the award committee should ask for its medal back.

Recent rhetoric from Washington has put the economic relationship between the U.S. and China squarely on the front burner, and Krugman is demanding that we crank up the flame. This week 130 members of Congress sent a letter to Treasury Secretary Timothy Geithner demanding that the Obama administration designate China as a “currency manipulator”. Following that, a bipartisan group of senators introduced a bill that looks to force the Obama administration’s hand. For its own part, Beijing invites criticism by continuing to deny its utterly obvious currency agenda.

As these tensions escalate, most economists urge Washington to tread lightly because of the negative fallout for America if China were to begin selling its enormous cache of U.S. Treasury bonds. Krugman pushes back, asserting that the U.S. risks little by playing hardball, and that China has more to lose. He asserts that a Chinese decision to end its purchases of U.S. Treasury debt would make only a marginal impact on long-term interest rates. Did you hear that Stockholm?

According to Krugman, our secret weapon of economic invincibility is the Fed’s ability to print dollars endlessly. If China were to foolishly decide to attack us by selling our debt, the Fed could simply step in and buy the excess with newly printed greenbacks. (In other words, Krugman sees no difference between funding the debt and monetizing it. See my latest video blog on the subject.). For Krugman, China would gain little from such an attack, but would lose the ability to export to its best customer and suffer severe losses in the value of its dollar holdings. Krugman’s worldview is reassuring – but it has absolutely nothing to do with reality.

There is a huge difference between selling your debt to another and “selling” it to yourself. When China buys our debt, it uses its own savings. In order to purchase a trillion dollars of U.S. Treasuries, the Fed would have to expand our money supply by a corresponding amount. Even Krugman acknowledges that this would cause the dollar to lose value; however, he feels that a weaker dollar is good for America and bad for China.

Krugman does not believe that a tanking dollar will translate into higher interest rates or higher consumer prices at home. No matter how many dollars the Fed creates, or how much value those dollars lose relative to other currencies, he is confident that as long as unemployment remains high, rates will stay low and inflation will remain under control. This is absurd.

If the dollar were to nosedive, the Fed would normally look to protect the currency by raising interest rates, thereby increasing foreign demand for the currency. But with an economy currently on crutches, the Fed will ignore a weakening dollar and continue to try to boost employment with near-zero rates.

But keeping the Fed Funds rate low only holds rates down for U.S. government debt. If the dollar weakens substantially, other rates offered to other borrowers will rise as investors demand greater returns to compensate for inflation. To keep rates low for homeowners, credit card borrowers, corporations, municipalities, and state governments, the Fed would be forced to buy, or guarantee, all forms of dollar-denominated debt. The Fed would become the lender of only resort.

Once the Fed shows that its commitment to low rates is limitless (the value of the dollar be damned), private creditors will quit the game. Even average Americans would hit the Fed’s bid. It would be a race for the exits, with no one wanting to be left holding a bag of worthless paper dollars.

Most economists, Krugman included, see cheap money as a panacea for all ills. And while it’s true that a falling dollar, by lowering the real value of U.S. wages, would help make U.S. goods more competitive, it would also lead to skyrocketing consumer prices, rapidly rising interest rates, and a collapse in American living standards. Make no mistake: this is the end game of Krugman’s “get tough on China” policy.

This apocalyptic scenario can only be avoided if Washington jealously guards the status quo, avoiding confrontation with China at all costs. Yet, even that is an outcome that no one can rationally expect. Given exploding U.S. government deficits and the inability of U.S. citizens and corporations to repair their balance sheets, the United States faces financing needs that even China’s gargantuan savings stockpile will be unable to cover.

Krugman is right about one thing – China’s currency peg is destabilizing the global economy and must end. But he fails utterly to understand the implications for the U.S. and China. If China were to reverse its role in the U.S. Treasury market, both economies would be destabilized in the short-term. But in the medium- and long-term, China would clearly emerge as the winner.

Absent Treasury-bond purchases, the value of the Chinese currency would rise sharply, causing goods prices to tumble in China. This long-delayed increase in purchasing power for everyday Chinese will unleash pent-up demand in what is already the largest middle class in the world. Chinese factories would retool in order to produce goods for their own citizens to consume. In RMB terms, commodity prices would plunge, making it easier for China to produce all kinds of stuff, such as automobiles, while also making it cheaper for the Chinese to buy gas. Millions will trade in bikes for cars, and Chinese oil imports will swell.

The opposite would occur in America, where an artificial, consumer-based economy, supported by Chinese lending, will come tumbling down. Without the ability to import cheap goods from overseas, Americans will pay more and get less. While gas and food become cheaper for the Chinese, they will simultaneously become much more expensive for Americans – so too will automobiles, consumer electronics, furniture, and just about every other product we want or need (even those few we still make ourselves).

Washington’s best option is to recognize that the current relationship is unsustainable and to plan, as best as possible, for a more viable future. We Americans also must be honest with ourselves and recognize that we have been living beyond our means and that our lifestyle has been largely financed by austerity in China. We must conceive of a plan that weans us from this dependence without provoking China to pull the rug out from under us before we have a firm footing. To construct a policy around Krugman’s ridiculous assumption that we benefit China more than they benefit us is to invite catastrophe on an unimaginable scale.

By Ed Kaitz

via: The American Thinker

Nancy Pelosi wants to give birth to a new kind of freedom in America — the freedom from being “job-locked.”

In an interview with Rachel Maddow Thursday evening, Pelosi asked Americans to “think” about a bright, new, liberating kind of utopia:

Think of an economy where people could be an artist or a photographer, a writer without worrying about keeping their day job in order to have health insurance. Or that people could start a business and be entrepreneurial and take risks, but not be job-locked because a child has a child has asthma or diabetes or someone in the family is bipolar. You name it, any condition is job-locking.

Maddow was so overwhelmed and smitten with Pelosi’s remarks that she posted the interview on her website under the following title: “Finally! Pelosi frames health reform for the win. (Hint: It’s about freedom.)”

The problem with Pelosi’s remarks, however, is that from hindsight, they are not bright, new, or liberating. On the contrary, almost identical words were penned over a hundred years ago by another champion of economic “freedom”: Karl Marx. Marx criticized the private economy because it led to the “renunciation of life and of human needs.”

Like Pelosi, Marx was deeply troubled by an economic system that left most people job-locked and unable to satisfy their “human need” to become more authentic. In other words, the more you have to work, said Marx, “the less you eat, drink, buy books, go to the theater or to balls, or to the public house, and the less you think, love, theorize, sing, paint, fence, etc.”

Marx chastised the middle class in England for being “so incurably debased by self-interest” and thirsty for a “quick profit” that they were incapable of recognizing the alienation from their true selves. Communist society, then, was the cure that could liberate us from our false selves and usher in a new kind of creativity and authenticity. Says Marx:

Communist society … regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticize after dinner, as the spirit moves me …”

This kind of sheer lunacy could have been hatched only by an unemployed academic and journalist like Marx, who, by the way, was supported financially in his authentically job-liberated struggle against capitalism by his wealthy colleague Friedrich Engels. What’s most disturbing is the number of wild-eyed crusaders, both then and now, who have fallen for Marx’s creative definition of “freedom.”

As for that nagging issue of just how “communist society” will “regulate the general production” after the socialist revolution, Engels had this to say:

The community will have to calculate what it can produce with the means at its disposal; and in accordance with the relationship of this productive power to the mass of consumers it will determine how far it has to raise or lower production.

In other words, leave it to the “community” (government) to worry about levels of production and consumption in order for the newly liberated and formerly “job-locked” citizens to pursue their lifelong dreams of being artists, writers, or photographers.

Friedrich Hayek wrote about this subtle shift in the word “freedom” over sixty years ago. He argued that as socialists began coming under fire for promoting servitude and control, they made the creative decision to harness to their “cart the strongest of all political motives — the craving for freedom.” For Hayek,

The subtle change in meaning to which the word ‘freedom’ was subjected in order that this argument sound plausible is important. To the great apostles of political freedom the word had meant freedom from coercion, freedom from the arbitrary power of other men, release from the ties which left the individual no choice but obedience to the orders of a superior to whom he was attached.

For the socialists, however, “before man could be truly free, the ‘despotism of physical want’ had to be broken, the ‘restraints of the economic system’ relaxed.” For Hayek, this new definition of freedom was “another name for the old demand for an equal distribution of wealth.”

Hayek asks a fascinating question that each and every American needs to consider before deciding whether to return any Obamacare-supporting politician to power this fall:

Who can seriously doubt … that the power which a multi-millionaire, who may be my neighbor and perhaps my employer, has over me is very much less than that which the smallest [bureaucrat] possess who wields the coercive power of the state and on whose discretion it depends whether and how I am to be allowed to live or to work?

Nancy Pelosi’s theory of “economic freedom,” you see, requires legions of new bureaucrats wielding the power of the state so that you can be liberated from your inauthentic, job-locked selves. If we take freedom in its true meaning — as freedom from coercion — we see instantly, however, that indeed, I am less coerced by a neighboring millionaire than by the tiniest government bureaucrat deciding where and when I can see a doctor, go to school, or become job-locked.

Years ago, before he died, I asked my father what he liked most about working in the home-building industry. After having been “job-locked” in the housing industry for over twenty years, he told me the following: “For me, the best thing of all is seeing a new family move into one of our homes.”

My father wasn’t a writer or an artist, but he was a kind, decent, hardworking man who loved his job and his family. Rather than struggle against the system and neglect his children like Marx did, my father felt it was part of his job, not the government’s, to take care of his family — including our health care.

Sounds pretty authentic to me.

by Jim Bunning

‘If the Senate cannot find $10 billion to pay for a measure we all support, we will never pay for anything.’

I have been serving the citizens of Kentucky for nearly 24 years in Washington. During that time I have been a member of both the House of Representatives and the United States Senate. I have taken thousands of votes in relation to spending the taxpayers’ money. I will be the first one to admit that I have cast some bad votes during my tenure, and I wish I could have some of them back. For too long, both Republicans and Democrats have treated the taxpayers’ money as a slush fund that does not ever end. At some point, the madness has to stop.

Over a month ago, Democrats passed and President Obama signed into law the “Pay-Go” legislation. It calls on Congress to pay for bills by not adding to our debt. It sounds like a common sense tool that would rein in government spending. Unfortunately, Pay-Go is a paper tiger. It has no teeth. I did not vote for the Democrats’ Pay-Go legislation because I knew it was just a political dog-and-pony show to get some good press after some political setbacks. Since the Pay-Go rule was enacted, the national debt has gone up $244,992,297,448.11 (as of Wednesday, that is).

Why now?

Last week, Majority Leader Harry Reid, D-Nev., asked to pass a 30-day extensions bill for unemployment insurance and other federal programs. Earlier in February, those extensions were included in a broader bipartisan bill that was paid for but did not meet Sen. Reid’s approval, and he nixed the deal. When I saw the Democrats in Congress were going to vote on the extensions bill without paying for it and not following their own Pay-Go rules, I said enough is enough.

Many people asked me, “Why now?” My answer is, “Why not now?” Why can’t a non-controversial measure in the Senate that would help those in need be paid for? If the Senate cannot find $10 billion to pay for a measure we all support, we will never pay for anything.

America is under a mountain of debt. Federal Reserve Chairman Ben Bernanke said in a hearing last month that the United States’ debt is unsustainable. We are on the verge of a tipping point where America’s debt will bring down our economy, and more people will join the unemployment lines. That is why I used my right as a United States Senator and objected.

Only in Washington

After four legislative days of impasse, I reached a supposed deal with Majority Leader Reid to have an up-or-down vote on a pay-for amendment that would fully fund the legislation and not add to the debt. Only minutes before the vote, Democrats used a parliamentary maneuver to set aside my amendment and not vote on the actual substance of it. Only in Washington could this happen. The Democrats did not want to vote on my amendment because they knew they were in the wrong and ignored their own rules. Hypocrisy again rules the day in Washington.

I have 40 grandchildren, and I want them to grow up in a country where they have all of the same opportunities I had as a child. I fear that they will not have those opportunities if Washington continues on its course of spending without paying for it. We are at over $12 trillion in debt. I know many Americans sit around their kitchen table and make the tough decisions. It is time for the politicians in Washington to do the same.

Jim Bunning is a Republican senator from Kentucky.

by Bill Bonner

Everyone says the euro is falling apart…that Europe itself can’t survive as a political unit.

Europe seems to lack the things that make for a strong political system. It has no common language, for example (there are more than 200 different languages in Europe). And it has no common culture either…or even a common religion…or a common race.

The Greeks are rioting in the streets. They’re upset because their government is trying to cut back on ‘services.’ Actually, it’s not the services that anyone would miss. It’s the money. The rioters are mostly people who live, in one way or another, at the expense of others…thanks to the government. They work for the government…or get handouts from it.

The poor Greek government is stuck. As in almost all other democracies, politicians bought votes by giving out jobs and money. This leads to a bidding war…in which political parties vie for favor with the voters by offering more and more “services.” One gives away bread. The other prefers circuses. Whether it is food stamps or foreign wars…the price is high. And eventually, the bids go beyond the capacity of the economy to pay them.

Greece is at that point. So are half the US states. They’re out of money. It’s “doomsday” in Illinois, says one headline. It’s a “state of emergency,” in New Jersey.

Lenders don’t want to give them any more money. Wisely, they worry they won’t get paid back. So, lenders demand higher interest rates to cover their increased risks…which puts the Greek budget even further in the red.

The Greeks think the Germans should come to their aid. Why? Because, in a way, it was the Germans who got them into this mess. Nobody would have lent so much money to the Greeks had it not been for the strong teuton-backed euro…and the implicit promise that if the Greeks got into trouble…which everyone knew they would…the rest of Europe would come to their aid.

Well, what do you know? The Greeks are in trouble. And the Germans don’t want to come to their aid. The Germans saved. They ran their own economy better. They are one of the few countries in Europe that is living, almost, within the terms of the treaty they all signed, in which they agreed to keep deficits below 3% of GDP. The German deficit is just a little more than 3%. The Greeks don’t even come close – with a deficit of 12.7%.

In America, the situation is a little different. The economy and the population are more homogenous. And much more of the money is in the hands of the central government. The Germans don’t see why their savings should be used to bail out the Greeks. They’ve got their economy. The Greeks have theirs. In the US, while there are regional differences, there is basically one economy…with one government that messes it up for everyone.

Is the US better off? Does central planning on a larger scale make the US dollar or the US economy stronger?

In fact, the looseness of the European experiment is a strength, not a weakness. What damages a paper currency is not an act of omission; it’s an act of commission. Neglecting to provide more cash and credit is not what kills paper money; on the contrary, it’s the willingness to provide unlimited amounts of it. So far, the Americans are. The Europeans – or at least the Germans – are not.

So, we’ll bet on the euro over the long term…both the euro and the dollar are “elastic” currencies. They both get stretched out of shape. But there are more people pulling at the dollar than the euro.

In the short run, anything could happen. There are probably more reasons for the dollar to go up than for it to go down. But in the long run, our money is on the euro.

Regards,

Bill Bonner
for The Daily Reckoning

Judge Andrew Napolitano gives a speech from the heart about freedom and from where our rights come. The Judge explains the hard core truth about the Constitution and why we must fight to regain and retain our freedoms.

He also showcases the true dangers of the Patriot Act and the overstepping of the government into our private lifes.

by Peter Schiff

Over the past three or four years a strange phenomenon has developed in the global investment markets. With some exceptions, many asset classes, in particular domestic and foreign equities, commodities, and foreign currencies have tended to move in the same direction on a day to day basis. The mega-correlation has lasted so long that most now take it for granted. This leaves investors with relatively simple choices: when to get in to the market in general and when to park assets in cash and U.S. Treasuries.

However, few recall that this pattern is relatively new in the annals of financial history. Fewer still realize the reason for the current anomaly. From my perspective the most logical explanation is fear, which has become global, pervasive, and persistent. Traditionally, when investors fear inflation they buy stocks, commodities, gold, and foreign currencies, and sell dollars and U.S. treasuries. When they fear deflation they sell stocks, commodities, gold, and foreign currencies, and buy dollars and U.S. treasuries. The problem is that right now, no one knows which one to fear. Depending on the news the pendulum swings from one extreme to another on a daily basis.

The natural consequence of an inflationary boom should be a deflationary bust. We’ve had the boom, but so far we have avoided the lion’s share of the bust, or at least the deflationary part. If the government were pursuing a sounder monetary policy, one that allowed markets to function properly, the deflationary scenario would be playing out. While in the long-run this is the correct approach, such a scenario would be very bearish for stocks, commodities and many foreign currencies. If on the other hand, the government fights the recession by putting the inflation pedal to the metal (which is the course they have chosen) investors should look to real assets and certain foreign currencies to protect their purchasing power. But for the most part, that is not happening.

The foreign exchange markets seem to be the center point for this inflation/deflation tug-of-war. After all, if asset prices are falling, cash is king. Since the dollar is still the reserve currency, it is the king of cash, and benefits most from the global deflation scenario. When the dollar rises, treasuries go along for the ride, as investors need a “safe” place to park them. But when the U.S. government reveals yet another staggering deficit forecast, inflationary fears come right back. Hence, a market without a clear direction.

Many look at this dynamic from the perspective of risk appetite rather than fear. They claim that when investors seek risk, they buy risky assets, such as stocks, but when they are risk adverse they seek the safety. But those who fear inflation sell dollars and treasuries not because they seek risk, but because they seek to avoid it.

Of course, if investors felt that the Fed would actually fight inflation with aggressive rate hikes then higher inflation would be perceived as detrimental to stock performance. However, just about everybody realizes that there is virtually no inflation scenario virulent enough to encourage Ben Bernanke and his cohorts to actually raise rates. In actuality, the most feared probabilities are that inflation runs out of control, or that deflation overwhelms the Fed’s efforts to prevent it.

From this perspective regardless of the direction of the stock market, assets are simply being re-priced to reflect one of two very unpleasant outcomes. Those who look at rising stock prices as a harbinger of economic growth are therefore mistaken. These moves more than likely reflect investors growing fear that the U.S. debt levels will swamp the dollar.

Given the extent of the fundamental problems that underlie the American economy, and degree to which government policies are making these problems worse, there can be little conviction that our economy will return to sustainable growth anytime soon. Therefore, attributing stock market strength to inflation fears rather economic strength makes far more sense.

Also, if higher U.S. stock prices really did result from an improving U.S. economy, the dollar would be rising in tandem with stocks. However, every time stock prices rise the dollar falls. The best explanation for this dichotomy is that it is inflation not growth that drives both stocks and the dollar. So rising stock prices do not really indicate a bull market in stocks, but a bear market in the dollar. Those who cannot differentiate between the two will continue to misread the market and the economy.

by Ron Paul

Last week marked the one year anniversary of the American Reinvestment and Recovery Act, or the stimulus bill, passing into law. While the debate over its success has been focused on whether or not it is stimulating the economy and on various questionable uses of funds, in my estimation this legislation is accomplishing exactly what it was intended to accomplish – grow the government.

Those of us concerned about the ever increasing level of government debt gasped at the astonishing $787 billion cost estimates for this bill. True to form it has actually cost 10 percent more at $862 billion. We heard over and over that government could not sit around and do nothing while people lost their jobs and houses. The administration claimed that unemployment would not go above 8 percent if the stimulus bill passed. Now, a year later, the government estimates that unemployment is over 10 percent. The real number is closer to 20 percent. It appears that those promises were total fabrications in order to close the deal.

In any case, the American people know that more government spending obviously equals more government. If the goal was to strengthen the private sector, Congress would have allowed businesses and individuals to keep more of their own money through meaningful tax cuts. Outrageously, the administration claims that they did “cut taxes” by reducing withholding, and that they have stimulated the private economy by increasing the amount of money in every worker’s paycheck. What they fail to mention is they did not change the total amount of taxes due. This means that all that money not withheld from paychecks will add up to a big unpleasant surprise when returns are filed this year. Many tax preparers are already seeing shocked taxpayers having to come up with big checks to the government when they normally expect a refund. Stimulus, indeed!

The administration also claims that thousands of jobs have been created or saved by this massive spending bill, but these are just more government jobs, and counterproductive in the long run. Funding for the public sector necessarily comes at the expense of an overtaxed private economy. But, it makes sense that government would seek to expand its payroll since every new bureaucrat becomes a likely advocate for big government, when an increasing number of Americans are demanding the opposite. But the more the burden, the closer the government parasite comes to killing its host.

Rather than learning the lessons of the past year, the administration is moving full-speed ahead to do even more economic damage. With the stimulus bill set as a precedent and victory declared, another “jobs” bill is in the works. And, in order to address the unavoidable issues of our massive deficit, the administration has named a bi-partisan commission to find ways to decrease it. Tax increases on the middle class are notoriously back “on the table”, exposing that campaign promise as another instance of merely saying what the people wanted to hear. If the obvious solution to our spending problems was seriously put forth, that is, getting back to the constitutional limitations of government, I would be shocked. More likely, this will be a tactic to increase taxes and spending in a way that passes the political buck.

by Chuck Norris

It’s still difficult to believe that last week President Obama actually celebrated Feb. 17 as the first anniversary of his stimulus plan (a.k.a. American Recovery and Reinvestment Act), in which Washington borrowed $862 billion on American taxpayers’ credit. Celebrating the piling of $1 trillion on the backs of our posterity?

Call me clueless, but I’ve never considered easing present circumstances by going into massive amounts of debt as an answer to anyone’s economic recovery and longevity.

But I bet there’s one date the president definitely won’t be celebrating: this Saturday, Feb. 27, which marks the first anniversary of the tea-party movement.

To think, last year at this time, the mainstream media and Washington politicians were either completely overlooking them or labeling those patriot gatherings as extreme and wacky fringe resistances. WorldNetDaily was virtually alone in reporting the tea parties as a legitimate patriotic movement, like the original 1773 protest in Boston Harbor.

Today, just one year later, tea-party patriots have proven themselves as a collective and formidable force and foe against big government power and corruption. Even according to the latest CBS News/New York Times poll, roughly one in five adult Americans identifies with the tea-party movement.

Tea-party patriots cross all partisan lines. What unifies us is our fundamental belief that what America’s founders established was good and right, that we’ve largely abandoned their vision, and the only recourse to reawaken America is to return to their principles and values. But that is easier said than done, as progressives have worked double-time to discredit and undermine them and the very pillars of their republic.

A few years back, an editor at the New York Times wrote, “The Founding Fathers were paranoid hypocrites and ungrateful malcontents.” He’s not alone. Many liberals in media and higher education share his sentiments, labeling our Founding Fathers as racists, bigots, chauvinists and charlatans, among other things. This is not only ungrateful – it’s wrong. It’s their contributions, not their character flaws, that we should be highlighting. As Samuel Adams said in 1771, “Let us first see it prov’d that they were mistakes. ‘Till then we must hold ourselves obliged to them for sentiments transmitted to us so worthy of their character, and so important to our security.”

Thomas G. West, professor of politics at the University of Dallas, rightly acknowledged our founders’ worth in his excellent book “Vindicating the Founders” by pointing out that they “set up a government that did what no democracy had ever done before: It combined majority rule with effective protection for minority rights. It enabled a larger number of men and women to live in prosperity and liberty than any other nation has ever done.”

Of course, the founders weren’t perfect, but they were far better than what leftist professors and progressives make them out to be. We know that most of the founders regarded slavery as a wrong that would have to be addressed.

They knew that equal rights applied to all: men, women and children – slave and free. They did not achieve all they wanted, but what they did achieve was miraculous. That miracle is our heritage. As Joseph Ellis stated in his narrative masterpiece, “Founding Brothers,” the Constitutional Convention should be called “the miracle of Philadelphia …”

America’s Founding Fathers gave us the framework and foundations to experience freedom and liberty for all. But we can’t do that unless we know who they were, what they stood for and what they achieved. To restore America, we need to reclaim our past and learn from it. It is only by turning back and examining the past that we can reawaken or (if you will) reboot our country.

Unfortunately, those who want to reconstruct our constitutional government, redefine our founding documents and revise our history according to their ideological whims are being allowed to do just that because of the apathy of too many well-meaning Americans. If we don’t care about our past, if we don’t learn our history, if we don’t cherish the Constitution and the principles of the Declaration of Independence, then just as we have allowed ourselves to be robbed of our past, so too will America be robbed of its rightful future.

The first thing we need to do to restore America is to insist that our government officials abide by the Constitution and the Bill of Rights and that they rightly interpret their tenets. If, like most people, you’re a little rusty on the Constitution and the Bill of Rights, here’s a quick primer or reminder of what our government was meant to be – and should be.

In 1776, by an act of the Second Continental Congress, the original 13 colonies of North America adopted a Declaration of Independence, dissolving their relations with England. America would be a confederation of independent countries (“states”). In 1777, the Articles of Confederation (our first Constitution and governing document) was written and adopted by the Second Continental Congress, though not ratified until 1781.

The Federalists soon recognized the deficiencies in the Articles of Confederation, and so they called for a constitutional convention in Philadelphia in 1787. By the end of their four-month convention, the United States Constitution was adopted, though not completely ratified until 1790. It has been amended 27 times since. (The first 10 amendments constitute the Bill of Rights.)

The whole point of the Constitution is to provide a framework for our government, to set its rules, and to protect our rights by limiting government power. The Constitution requires that the president and members of Congress “be bound by Oath or Affirmation to support this constitution.” In other words, every elected member of the federal government is accountable for abiding by the Constitution.

We the people must hold them accountable. But how many of us hold our elected leaders to account? And how far have we allowed the federal government and federal courts to take powers that the Constitution doesn’t give them? When we do, we let them rob us of our own freedom, and of the rights to self-determination that our forefathers wanted us to have.

It’s time to bombard the White House and congressional leaders with copies of our Constitution and remind them that we the people are going to hold them accountable to it or we’ll vote them out.

America’s greatest problem is that we have forgotten our roots. Too many of us don’t know or don’t feel connected to those who founded our country.

Case in point, in 2007, a national survey commissioned by the U.S. Mint found that only 30 percent of Americans knew that Thomas Jefferson was our third president, and only 7 percent could name the first four presidents in order.

If you’re a part of the 93 percent, then you know that they were George Washington, John Adams, Thomas Jefferson and James Madison. The fact is most Americans don’t have a clue why our founders created this country, what principles motivated them or why they framed our Constitution the way they did.

As citizens of this great country, we need to renew our understanding of the Declaration of Independence and the Constitution. We need to go back and study the debates between the Federalists and the Anti-Federalists, to understand why many founders like Thomas Jefferson were very concerned about a run-away federal government.

We need to examine other important documents of our history, like the Articles of Confederation, the Bill of Rights and the Northwest Ordinance. We need to sit down and learn all the important American history we should have learned in school – and probably didn’t.

You might not have thought it mattered then. But you have to understand that it matters now. If Americans don’t know their constitutional history, then they won’t care, or even acknowledge, that our Constitution of liberty is being transformed into a charter for big government, which is exactly what has happened over a period of decades.

Clearly, the government we have today is not the government outlined in the Constitution. It’s grown far beyond the limits the Constitution sets – and as a result we are facing dangers from which the Constitution’s framers tried to preserve us.

The framers set out a path for us, and we’ve strayed from it. And the first thing any rational man does when he’s lost his way is to look at a map. If you think, as I do, that America has taken a wrong turn, studying America’s Revolutionary history is the first step to helping us find our way back. Just like millions of tea-party patriots have already done.

To find a tea-party birthday celebration in your area this Saturday, Feb. 27, check out the various gatherings under “events” at Teaparty.freedomworks.org.

Happy first birthday tea-party patriots! If participants in the Boston Tea Party of 1773 laid the groundwork for the Declaration of Independence just three years later, imagine what impact you can have by the time you celebrate your third birthday.

And to think they thought you were just fleeting fringe fanatics!

(For more on how to reawaken America to our founder’s vision and plans for this country, check out Chuck Norris’ brand new – January 2010 – expanded paperback version of his New York Times best-seller, “Black Belt Patriotism.”)

Get More Chuck Norris Here

by Jake Towne

“Whenever you have truth it must be given with love, or the message and the messenger will be rejected.”

“You can chain me, you can torture me, you can even destroy this body, but you will never imprison my mind.” – Gandhi

These are just two of the many lessons it appears that Joseph Stack, aged 53, never learned. For those unaware, Mr. Stack set fire to his family’s home and crashed a private plane into the IRS Austin branch during the workday, killing one other person, injuring 13, and two of the injured are in critical condition. While full details surrounding this incident are still unclear, the FBI believes that his suicide note is genuine. Accounts from Stack’s friends indicate his acts were completely unexpected.

If Stack’s note proves genuine, it is clear that this was not only premeditated murder but also an act of political terrorism, eerily similar to the hijacked airliners of 9/11. After reading his note, it is plainly obvious that this man was adversely affected and bitterly unsatisfied with the over-taxation practices of the IRS and Congress (a theme of the Taxed Enough Already, aka TEA party movement) and government-sponsored crony capitalism (a theme commonly associated by the media with the political left). In his note:

“It has always been a myth that people have stopped dying for their freedom in this country… I also know that by not adding my body to the count, I insure nothing will change…

I can only hope that the numbers quickly get too big to be white washed and ignored that the American zombies wake up and revolt; it will take nothing less.

I would only hope that by striking a nerve that stimulates the inevitable double standard, knee-jerk government reaction that results in more stupid draconian restrictions people wake up and begin to see the pompous political thugs and their mindless minions for what they are.”

Truth is often a bitter pill, but the terrorists who died while murdering 2,973 civilians on 9/11 also had a similar goal; to create a “knee-jerk government reaction.” Congress and recent Presidents from both parties have bled our nation of the blood of our bravest by instigating the Afghanistan and Iraq Wars, ruined our economy with bailouts and rampant unemployment, created “draconian restrictions” like the PATRIOT Act which stripped Americans of their civil liberties, enabling warrantless wiretapping of American citizens, revoking habeas corpus, and leading to the torture of defenseless captives. Congress foolishly rushed headlong into this trap of epic proportions, assisted by unwitting saps like my district’s Congressman Charlie Dent, who approved the banker bailouts, accelerated the deficit spending, reauthorized the PATRIOT Act, and voted to increase insane levels of military spending at every opportunity.

I condemn Stack’s cowardly act of murder and political terrorism. While one of my campaign’s planks is the abolition of the Marxian federal income tax and the IRS, the route I have taken – placing my engineering career on hold for 18 months to run for office – is peaceful and logical. As Gandhi taught, messengers for the truth are almost always best served by acting in a non-violent manner.

By erecting a prison in his own mind where Stack’s only recourse became violence and self-destruction, Stack has just created a way for Establishment shills to defame the liberty movement as hailing this terrorist as a “hero” as ABC’s Lee Ferran has done.

Where Stack murdered, many others, myself included, argue the moral case that the government simply should never have any claim whatsoever on the fruit of an individual’s labor.

Where Stack raged about a vague clause in the IRS code that plundered him, I have pointed out that not only is the federal income tax immoral, but fiscally it is completely UNNECESSARY.

Where Stack rants about the injustices of a hopelessly corrupt political process, I have calmly pointed out America’s greatest political secret – that a determined minority can ultimately destroy the ability of Republocrat apparatchiks to control which candidates are selected, especially in party primaries like the Republican party in Pennsylvania just did, which truly does make a mockery of the democratic voting process.

LOOK ACROSS THE LAND! Listen to your families and friends! Plenty of people grumble about politics and say they could do the job better, but many do not have the financial means, drive, or knowledge to mount legit challenges to the Republican and Democrat machines that are destroying our nation. This is despite the fact that nationwide the numbers of independents and third parties are LARGER THAN EITHER MAJOR PARTY.

When I made the decision to run as an independent under no political party in May 2009, I was fully aware of the challenges ahead. However, my race is certainly winnable – I am already at 8% in a January poll run by a Republocrat opponent, and the vast majority (about 92%) have not even heard the message yet.

Liberty may once again teeter on a knife’s edge in the months and years to come. Whether America eats the bitter, evil apple of socialism, and falls to war, poverty and endless debt for our children is a choice now left to US.

Americans need to hear the truth – a message of prosperity, liberty, love and peace. The Republocrats can only offer more lies, tyranny, hate and war. This choice is OURS. My choice is to rally at the breach, to defend freedom and restore the rule of law and our constitutional republic.

I have faith that the truth will prove sharper than any sword.

Jake Towne

“Veritas numquam perit. Veritas odit moras. Veritas vincit.”
Truth never perishes. Truth hates delay. Truth conquers.

Tu ne cede malis sed contra audentior ito.
Do not give in to evil but proceed ever more boldly against it.

Now, ever so quietly, the Obama administration is working with Senate Majority Leader Harry Reid and Speaker of the House Nancy Pelosi to sneak reauthorization of the Patriot Act through without creating a stir among liberty-minded Americans.

The Patriot Act, One of the things Obama said he would eliminate during his campaign. Now they want to renew it and Obama is endorsing it. Don’t let them get away with it twice. The Patriot Act has done nothing to guard against terrorism but can and has been used to harass our own citizens and rob us of freedoms , like the freedom of speech. They can monitor all your private mail, telephone calls, e-mail, Track where you go, what you do, who you speak to, all in the name of national security.

Harry Reid Contact:
Phone: (202) 224-3542
Fax: (202) 224-7327

Nancy Pelosi Contact:
Phone: (202) 225-4965
Fax: (202) 225-8259

Contact Your Congress Representative:
http://www.contactingthecongress.org/

Contact Your Senator:
http://www.senate.gov/general/contact_information/

It looks like 3 main provisions that are expiring but we should demand repealment of the entire unconstitutional “law”.

Insiders have said that Harry Reid plans to sneak the Patriot Act re-authorization through the Senate as soon as they come back into session as part of a massive $85 billion special interest giveaway as a “Jobs Bill.”

This bill is loaded with pork barrel spending and pay-offs to favored senators, union bosses and big government advocacy groups, and is itself another nail in the coffin of America’s economic stability.

That’s why your voice added to the petition below and your opposition to this outrage are critical.)

Liberty Petition
Petition to Senator Max Baucus & Senator Jon Tester

Whereas: Giving up Liberty for Security is a false choice, and causes us to lose both; and

Whereas: American citizens are entitled to 4th Amendment protections against secret searches, National Security Letters, and warrantless searches and wiretaps; and

Whereas: Law enforcement and national security can adequately do their jobs without accessing the private information of innocent, law-abiding citizens; and

Whereas: The misnamed Patriot Act violates our constitutional rights and takes away the very freedom we are claiming to protect from terrorists; and

Whereas: The Patriot Act gives too much power, shrouded in too much secrecy, to government agencies;

Therefore: I urge you to uphold your oath to the Constitution and your duty to protect the rights of your constituents by voting and working for the defeat of the Patriot Act at every opportunity.

Click here sign the petition here.

Don’t sit back and do nothing, only to complain later. Here we have a chance to stop them before it can come up for a vote. If enough people call and show up to protest then we may actually be able to get rid of the Patriot Act for good, and restore some of our lost liberties as American citizens.

by MJ Harris

The latest numbers show that the US trade deficit had widened again this month. Instead of Americans spending less and saving more so that the trade deficit can shrink, the government is encouraging more spending so the trade deficit is actually expanding.

There is still alot of uncertainty surrounding the Greece and the Eurozone ‘PIGS’ bailouts. (This is how the financial markets are refering to the heavily-indebted countries of Europe: Portugal, Ireland, Greece and Spain.) Causing temporary flight back to the dollar. Bringing it to its highest levels in several months. These bailouts are bad for the economy as a whole because it promotes reckless behavior and rewards those who took on too big risks, with no regard for consequences.

This also sends messages to surrounding countries that they don’t need to reign in their risky behavior as well because no matter what happens they will be able to get bailed out.

“The problems we see in Europe will be coming to the United States soon at the state levels.”

Senate Candidate Peter Schiff recently said in an weekly podcast “In the end the federal government will come to the rescue with bailouts and that is going to lead to more reckless spending and even more risky lending by institutions because they feel like they will eventually get bailed out themselves.”

We know that the federal government is approaching bankrupt as well, as it continues to raise the federal deficit ceiling.

While the dollar has seen a temporary boost while others countries are in a state of panic, there is still a day of reckoning coming for the US dollar. We have been borrowing more and more money, however we aren’t spending money on productive things. Instead the majority of money is “blown” away in the middle east, while the rest is sucked down the drain of endless pension benefits for people who are no longer working.

The artificially high levels of the dollar have provided a great opportunity to buy gold. Just a few months ago gold was breaking records every week. Now it has pulled back off of those new highs, providing a good price to buy more. The new strength in the dollar should be short lived because Washington continues to run the printing press around the clock. Which will eventually create another round of new highs for gold in the years to come.

Disclosure: This article was sponsored by Goldline International. Without our sponsors The Liberty Guardian could not continue.

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