Marxism Marches On
Feb 4th, 2009 | By Dan Denning | Category: Featured, Personal Liberties, Politics
The week begins with a bang, according to the Financial Times. The FT reports that, “The Obama administration is gearing up for a ‘big bang’ announcement within the next two weeks that will combine a bank clean-up with measures to reduce home foreclosures and probably steps to kick-start credit markets.”
Obama as Prime Mover will have to turn the chaos in America’s housing and mortgage market into harmonious order. Then He has to single-handedly leap a tall legacy of toxic assets in a single bound, freeing up banks to lend by buying all of their dodgy assets.
It’s a big ask. But if anyone can do it, He can. Especially when He’s got America’s credit rating to abuse!
Reordering the financial universe is not cheap. It takes a lot of energy and a lot of matter in the form of new U.S. dollars. Reuters reports that, “Goldman Sachs estimated that it would take on the order of $4 trillion to buy troubled mortgage and consumer debt. That number could shrink if the program were limited to only certain loans or banks, but it could also grow if other asset classes such as commercial real estate loans were included.”
How much is $4 trillion? “At $4 trillion, that would be the equivalent of nearly 1/3 of U.S. gross domestic product. If the government had to fund that amount by issuing additional debt, it would intensify investor concerns about massive supply scaring off demand.”
Yes. You can imagine the world’s main owners of dollar-denominated reserve assets (China, Japan, the Petro states) would be intensely concerned about a $4 trillion increase in dollar denominated debt. But wait a tick…
It’s one thing to say you might need to float as much as $4 trillion in debt to fund your bad bank. It’s another thing to sell that debt? Who will buy it? Even these days, $4 trillion is a lot of capital to loan. Maybe that number has been floated to make a smaller number, say $2 trillion, look small by comparison.
Good news everyone! The Bad Bank is going to cost us half as much as we thought!
If the ‘big bang’ goes off this week, what will it mean for Planet U.S. Dollar? Or Planet Gold? Well, as our friend Steve Belmont in Chicago reported on Friday, gold is moving toward a day of reckoning after trading in a range for the last ten months. It will either break out much higher, Steve says, or buckle. We’ll be watching.
Did you notice the obnoxious change in political rhetoric this weekend? You knew Barrack Obama was going to give it to Wall Street, calling executives “shameful” for getting bonuses while their firms received TARP money. Remember, by the way, the TARP money was forced on some firms in an effort to boost confidence in the overall plan.
We normally try to keep a reserved, ironic, and sceptical air when reading the statements of politicians. Most of them are not worth taking seriously. But every once in a while, you get the scent of something so noxious and dangerous that you have to put aside humour and call it what is. Today is one of those days.
Now, the populist shame game is to be expected. That’s not a big deal. What’s more alarming is the bilge and claptrap spilling from Kevin Rudd’s gob and what it may mean for your ability to preserve and create wealth in the coming years.
In The Monthly, Rudd plants a Neo-Marxist flag in the ground of the current debate with the kind of jargon-laden elitist preening that makes academic critics of the free market (who’ve never spent a day in the business world creating value) so nauseating.
Specifically, Rudd writes that, “The time has come, off the back of the current crisis, to proclaim that the great neo-liberal experiment of the past 30 years has failed, that the emperor has no clothes. Neo-liberalism, and the free-market fundamentalism it has produced, has been revealed as little more than personal greed dressed up as an economic philosophy.”
Why not proclaim, since he is apparently in the position to make such proclamations, that the experiment in paper money and the deliberate policy of inflation it implies is theft? It is bureaucratic lust for power and authority disguised as monetary policy? It’s also, at its heart, the belief that one or a few people in government know better than you how you should lead your life.
Leave it to Rudd and the resurgent global Left to use the present crisis as an occasion to expand their political ideology of government power and wealth confiscation. Despite the fall of the Berlin Wall in 1989, Marxism never really went away. It ensconced itself in Western universities and colleges, and in the careerism of the political class, which believes it is entitled to govern by virtue of its intellectual superiority and the moral justness of its anti-market position.
Their strategy, as always, is to control the rhetorical high ground by framing the discussion in populist terms and making an enemy of “greedy capitalists.” Don’t get us wrong. There are plenty of greedy capitalists to go around, or to go to jail. In fact, many more of them would be going out of business if the government would quit propping them up with taxpayer money. This generation of corporate executives shares plenty of blame for playing fast and loose with the corporations they were supposed to be stewards of. They over-levered, over-speculated, and over-paid themselves.
But Rudd is an ignoramus of the lowest order to say that current events somehow negate the last thirty years of globalisation, or three hundred years of economic growth and the division of labour. Tens of millions have been lifted out of poverty. Hundreds of millions have more economic and political freedom than ever before.
These results can only be the product of a system in which risk taking entrepreneurs have access to capital and savings, allocated through competitive markets where firms that deliver real value to consumers thrive and those that don’t fail. That system has worked for 300 years of Western history to create wealth, choice, and opportunity.
Shame on Kevin Rudd for calling that “market fundamentalism”, as if belief in the institutions that create wealth and liberty is akin to the same kind of religious fundamentalism that permits suicide bombing. If there is a more offensive use of rhetoric to equate two vastly different things, we haven’t seen it.
But the Neo-Marxists are back on the march. And they are probably coming for your wages and pension sometime soon. Make no mistake about it. 2009 is the year the Neo-Marxists have been waiting for.
It is their chance to undo all the perceived evils of Thatcher and Reagan. There would be plenty of those to undo, of course, not least the idea that deficit spending is morally permissible. But the real push by the Neo-Marxists is to use the present occasion to expand the scope and reach of government power into your private life, so they can tell you what to do, what to watch, what to eat, what car to drive, and ultimately, what to think or say.
This will be disguised as better more “parental” regulation to achieve more equality and social justice. But behind the false populist outrage and the elevated language of idealism, it’s just another push for government elites to expand their ability to compel you to live the life they think you should lead.
The simple regulatory response to all this is to reduce the amount of leverage available to financial players. Reduce margin lending in shares. Let bankers get back to making prudent loans in the housing market based on what a buyer can actually repay, rather than letting the government subsidise subprime lending because it’s politically desirable.
There are other sensible regulatory responses to the mess. But they will be discarded in favour of grandiose and over-reaching plans to redesign the entire world in some utopian image. A “big bang”? Really. Does that mean they’re going to blow things up and call it a “fix?”
What we’re getting at is that it’s going to be a tremendous challenge to withstand this push in the next few years, mostly because it will have so much popular support from people with no brains who believe in fine sounding speeches and appreciate getting tax rebates/credits/handouts from the government. The first battle in the war on wealth creation is wealth redistribution, whether you like it or not.
It would be more honest if the Left just came out and said something like, “The last ten years have been a huge wealth transfer from the middle class to Wall Street and from the developing world to the developed world. We’re going to try and reverse all that now because we know it’s our best shot in the last thirty years to get some back. So here we come! Open your wallet and shut your mouth!”
Neo-liberalism isn’t the culprit in all this. What does that word even mean? Isn’t Rudd using it because it sounds like Neo-Conservatism? And everyone knows that Neo-conservatism is evil, therefore Neo-Liberalism must be evil too!
The real evil of the last thirty years is the vast expansion of credit in the world that changed personal and corporate incentives. The plunge in the cost of capital-encouraged by governments and Central Banks-set of an orgy of bad risk taking, quietly condoned by regulators and politicians who all benefitted in some way from housing/commodity/trade booms.
But now the credit cycle has turned. The Credit Depression is upon us. And Comrades Rudd and Obama will try and use it for the next great push in the Neo-Marxist dream, one world government with one world currency. More on that tomorrow!
Regards,
Dan Denning
February 4, 2009
Marxism, is right. I say that ACORN with their policy of election fraud combined with strong arm tactics manipulated the current condition, forcing government to step in ( under the Trojan horse of “fiancial crisis” and re-write the entire book and do away from once the free enterprise system (FES) as we know it. Because is those kinds of people( ones who despise the FES) who point to it as the reason for the “crisis” I say it is they and their agenda of failure ,due to their laziness and indoctrination that governement shoudl take care of you from cradle to grave and their crimnal manipulation that has lead us to this point.
Good on ya, Dan. Keep it coming!
The March of Marxism and its still only February?
[...] Source: Marxism Marches On Advertisement Tags: Commercial Real Estate, Consumer Debt, Credit Markets, Dan Denning, Gross Domestic Product, home foreclosures, Marxism, Mortgage Market, Obama administration, Real Estate Loans By Dan Denning [...]
Thank you very much Dan. Awesome column.
The more faith people have in their leaders and the less faith they have in themselves the less Individual Liberty, freedoms, and wealth they are likely to have.
People should not trust any person 100 percent. This is especially true when dealing with government leaders. A person should not trust the person’s self 100 percent. I do not trust myself or anybody else 100 percent.
I recommend people read
Caesar: A Bilography by Christian Meier
Article 1, Section 8 of the United States Constitution
The Federalist Papers
George Washington’s Farewell Address http://www.earlyamerica.com/ea...../text.html. He was right about political parties and many other things. It is amazing.
Machiavelli’s Discourses
THE ART OF WAR by Sun Tzu
Artful PERSUASION
How to command attention, change minds, and influence people by Harry Mills. The book discusses how government leaders and others manipulate people.
I graduated from the University of New Hampshire in 1992 with a BA Degree in Political Science and a minor in Economics.
I ran for United States Senate in 2002.
I discuss dealing with the financial crisis and Amendments to the United States Constitution which would help State Legislatures reduce harm caused by the federal government on http://www.newgeography.com/users/kenstremsky
My website is http://www.myspace.com/kennethstremsky
[...] Source: Marxism Marches On [...]
Here are a few things you may not have heard about it:
1) This is very good for the country as a whole. As The Nation writes, “If enacted, the economic recovery plan will be one of the biggest and boldest pieces of progressive legislation in the past forty years.”1
Here are some facts about what the bill really does:
* Creates or saves 3 million to 4 million jobs in the next two years.2
* Averts “literally hundreds of thousands of teacher layoffs”—and doubles funding for the Department of Education.3
* Creates 500,000 green jobs and doubles our clean energy production.4
* Immediately helps unemployed folks get affordable health insurance.5
Some folks are arguing that it should be bigger, and they’re probably right, but this is the best down payment on economic recovery, and it needs to be passed.
2) The stuff that’s being singled out for criticism amounts to a tiny fraction of the bill—like anti-smoking programs that make up less than one-ten-thousandth of the spending.6 Folks like Dan Denning would have you believe this is the centerpiece of the bill. It is not. This kind of nit-picking is pure politics.
3) If it doesn’t pass, we’re in deep trouble. Even John McCain’s economic adviser estimates that without the stimulus, unemployment would top 11% by 2010, the highest level since the Great Depression.7
We all urgently need to get these facts out before the public. Can Whiskey and Gunpowder help by explaining how the stimulus will affect the majority of people?
Last week alone, 100,000 people lost their jobs in this country.8 Nearly 200 economists from across the political spectrum wrote to Congress to say:
“We do not have the luxury of a lengthy debate over the best course of action. This legislation may not be enough to solve all the economy’s problems, but it is urgently needed and an important step in the right direction.”9
But with so much rhetoric and demagoguery surrounding the bill, it won’t pass unless we can get the real facts out to a wide audience. Will you help?
Certainly, Dan Denning, a specialist in small-cap stocks, who has his base in Melbourne, Australia, hates change. Too bad he ignores the facts.
No matter how one defines it, the march to control your every movement, thought, action, etc., is really on. The nationalization of banks, or any other industry, is the definite goal. Nancy Pelosi in some sort of committee was caught sating the word “nationalization” just before this crisis. She quickly backtracked when she realized she had said that word before the public relations campaign had officially started. It has now started officially. Many are using that term as though it is to be expected & as if it is the only possible solution to runaway capitalism. Few calling for these socialist policies are admitting much of our problems came from the very political partisans & radical activist groups who caused much of these problem.
Vaclav Klaus, the President of the Czech Republic & current six month President of the European Common Market, lived under socialism for fifty years of his life. This man knows what oppression & demoralization really means. He knows how oppressive government running all aspects of life, the economy, political life, social life, & everything else they can get their fingers into, can take someone & make them so depressed & so uninterested in even living life, can be. He has lived it & if you listen to him talk or read one of his books, you will be forever enlightened. You will understand why socialism or Marxism is not the way of individual freedom or liberties for people. Average people always suffer under this kind of governance. Hugo Chavez promised he would better the lives of his people. What he meant was, he would give some scraps to the little people (since there are so many of them in Venezuela), & then use his power to demand MORE power, all the while personally enriching himself & his loyal henchmen. He talked of freedom, but just recently called for the closing of opposition news outlets. They were demoralizing the people & they were spreading untruths about him & his policies. In short, they voiced concerns about what he was doing to the national treasury & he did not want that. So, close the press who speaks out. Now, fast forward to President Obama making mention the other day that Republicans (or others) should not listen to Rush Limbaugh. The same policy or plan, to silence opposition. In short, oppressive socialism or Marxism.
If what Keith Olbermann, or Rachel Maddow, or Chris Matthews, or Al Franken, or Bill Maher, or a host of others, has to say is OK, then why are Rush Limbaugh’s words not to be listened to? What makes his opposition or views different from those of the listed liberals? The answer is, he does not agree & offers a different perspective, so his voice should be silenced so he does not get the rabble upset. We only want people to listen to what we have to say, because “we know what is best & we have the power to make it so!”
Like the stellar track record of government is something we all should stand up & applaud based on its spectacular successes. The fact is, bungling politicians, from BOTH sides of the aisle, have totally screwed up America, whether its financial, legal, immigrant, social, religious, or otherwise. The people had a lot to do with it. BUT, the real affects were imposed on us by an intrusive, abusive, over-reaching government that seeks to run our very lives.
Klaus said recently, “Illiberal ideas are becoming to be formulated, spread and preached under the name of ideologies or “isms”, which have – at least formally and nominally – nothing in common with the old-style, explicit socialism. These ideas are, however, in many respects similar to it. There is always a limiting (or constraining) of human freedom, there is always ambitious social engineering, there is always an immodest ‘enforcement of a good’ by those who are who are self appointed as anointed, on others, against their will, there is always the crowding out of standard democratic methods by alternative political procedures, and there is always the feeling of superiority of intellectuals and of their ambitions.”
In short, once those who “think” they & their idea’s are superior to all else just because “they think they are better & therefore right & therefore entitled to lead, even if by force over others”, always leads to despotic socialistic government that oppresses all & especially those who foolishly thought the despots would treat them better. They always lose out big when the special people finally show the little people they are but mere pawns to be used, abused, & discarded as the superior people decide.
Marxism, socialism, environmentalism, or whatever, it always means oppression & despotic government & the people always end up with the short end of the stick which is always eventually used to beat the people into submission to the those who see themselves as the superior elite!
Rubicon, you’re dead wrong.
Rubicon, you are dead right. Couldn’t have said it better myself.
Less government is ALWAYS better.
Crisis, reaction, solution… When will the public learn?
There’s no need to bring in Marxism or to argue that this is an issue between capitalism vs. Marxism. Rather, capitalism fails for the simply reason that it is based on credit economies and the need for unlimited growth. Claims that we need less government, that the government is primarily responsible for increasing money supply, that free markets work, that people will become wealthy if there’s less government, or that government works against big business are all part of neocon propaganda that big business supports. In reality, most of the money supply is created through credit extended by private banks, there are no free markets except markets dominated by big business, government works for and with big business, and the wealth that people talk about is nothing more than fiat currency guaranteed by the same government.
In the end, it’s not just government that we should consider but problems created by big business that either insisted on producing and selling more or playing casino capitalism for greater profits. If you think that the amounts that will be lost due to bailout spending and stimulus packages will be huge, wait till you see what big business is about to lose thanks to virtual financing.
Thoughts on Stock piling things, weapons, salt, heirloom seeds, so you can raise your on food, the hybrid seeds saved from year to year will not produce the second year. Make sure you stock pile rope, wire, flint & steel. On stock piling weapons, it is not how large a weapon, but how much ammo you can afford to buy and carry on your person. A 22 caliber rifle is the perfect weapon, light, accurate, ammo is cheap and you can carry several hundred rounds at a time. Will kill game and defend your property.
Gas lanterns, cast iron cook wear, wind up radio & flash lights.
I certainly agree with most of the bits and scenarios but this one world government analogy is stretching the skin. When we take a look-see at some of our [America's] own power hungry politicians the amount of rancid and stinking character diversity is abundant, to say the least. Look at Hillary and her dream of a communist nation, Barney Franks’ rip & tear philosophy of capitalism, Obama’s “I’ll lead you to the promised land”, and Nancy Pelosi and Harry Reed’s edging each other out of the lime-light’s glory. There are just too many hungry politicians, not only in this country but most others on our globe to avoid skirmishes over ideologies.. These kind of people are too self-indulging to allow any type of coalition for very long. So, a one world, one government will not work for the sake and name of GREED, political or materialistic.