Government also lies, cooks the books, and distorts the facts when it comes to taxes. Obama tells us that tax increases will not hurt the economy. He calls tax cuts “handouts” to the wealthy. He says that tax cuts create deficits. But whenever Obama wants to spur the economy, he is quick to offer tax cuts to his voters. When Obama wanted to sell cars, he offered a tax cut called “Cash for Clunkers.” When Obama wanted to sell homes he offered a tax rebate to homebuyers. When Obama wanted to sell appliances, he offered a tax rebate to consumers. When Obama wanted to encourage spending, he offered an almost trillion dollar stimulus in the form of “tax cuts” to people that never paid taxes in the first place. Weren’t all those programs “handouts”? Didn’t those tax cuts increase the deficit? This is how politicians distort facts and cook the books.

But the most telling story of all about taxes is found in Michigan. Michigan is a big government, big entitlement, big union state run by leftist and socialist progressives (just like Obama). It is no surprise that Michigan suffers from the worst economy in America; 14% unemployment; “empty cities” like Detroit (which has lost half of its population); and leads the nation in moving vans moving out. Yet one thing is working fantastically in Michigan- TAX CUTS!

In the midst of economic Armageddon in Michigan there is one part of the economy that is booming- movie production. Why? Because Michigan offers the most generous tax incentives in the nation for movie-makers. The result? The liberal progressive hypocrites of the movie business…the same ones who support Obama…the same ones who call tax cuts for the rich “greedy”… have moved Hollywood to Michigan! Last year 87 films were made in Michigan- a 900% increase from the year before. 3 major movie studios are opening this year in Michigan. Yes, the tax rebates cost Michigan $40 million…but those same tax cuts produced 7000 new jobs and $325 million in new revenues for the Michigan economy. Now that’s a great economic success story.

Michigan is Exhibit A for proving that allowing taxpayers to keep more of their own money works like magic. Even amidst the most worst economy and worst weather in America, it’s enough to convince Hollywood hypocrites to relocate from sunny Southern California to depressing and freezing Michigan! Can you imagine what a dramatic tax cut would do for the entire American economy?

Well I can- and I’ve got the plan. Let’s institute a one-year “Income Tax Vacation” for the taxpayers of America. This would benefit in particular small business owners- who pay most of the taxes and create 75% (or more) of new jobs. If you let them keep 100% of their own money for one year, they will create the greatest economic turnaround in world history. They will invest it in stocks (driving up the stock market), bonds (driving down interest rates), real estate (ending the foreclosure crisis), starting new business and expanding old ones (creating millions of new jobs and producing millions in new tax revenue). They will invest in and revitalize America.

Obama, Reid and Pelosi (the Axis of Taxes) would say, “But where would we find the money?” Well Obama found the money for $1 trillion in stimulus…$1 trillion for universal healthcare…$13 trillion for bailouts…and billions more for earmarks and legal bribery (to gain the votes to pass all this obscene spending). Those programs have failed to reignite the economy because Obama doesn’t understand simple economics. Small business is the economic engine of America. Yet Obama wants to incentivize everyone in the country- except the taxpayers and small business owners who actually pay the bills…and create the jobs. Reagan’s tax cuts proved that if you motivate small business with a dramatic tax cut, you can turn a deep recession into an economic boom almost overnight. Well this isn’t a recession, it’s a depression. It calls for special measures. This Income Tax Vacation is “Reagan squared.”

Perhaps Obama knows exactly what he’s doing. Perhaps Obama’s goal is to punish, demonize and demoralize the successful…redistribute the wealth…forever cripple the people who contribute to limited government causes…and bankrupt the capitalist system, so that Americans grow desperate and dependent on government. There is one problem with this scheme Mr. Obama- who will be left to pay all the bills?

Regards,
Wayne Allyn Root
Whiskey & Gunpowder

April 15, 2010

Less Tax for Economic Turnaround was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

Specifically, that lesson is that you cannot criticize, even rightly, the previous administration’s deficit spending and then triple the deficit without paying a price. I find this extremely encouraging.

America has a lot to do before the potential of the economy is unleashed again, but the tide has turned. Americans have seen what out-of-control spending does to states under the ideological control of people like Nancy Pelosi. And that lesson will be driven home in months to come. California’s State Controller John Chiang has warned that the state will be unable to pay its bills if legislators do not act on nearly $9 billion in budget cuts sought by Gov. Schwarzenegger.

I have the dubious distinction, incidentally, of having personally introduced the Governator to the champion of markets, Dr. Milton Friedman. Friedman was speaking at an event sponsored by the think tank I worked for not long after Conan the Barbarian was released. I’d read that the actor admired Friedman and invited him to the event. He came, in fact, and I put the two together.

Sadly, Schwarzenegger’s public appreciation of Friedman never really translated into policy. Today, a distressed California serves as an example of what happens when markets are seen as tax farms for politicians, no matter how lofty their goals. Friends of mine in California now admit that Texas, which they once considered a redneck backwoods, actually delivers what California has only promised.

Of course, the July issue of The Economist helped drive the point home. In a now famous article titled “California v Texas: America’s Future,” The Economist painfully detailed the differences between the states. Texans’ preference for low taxes, fiscal restraint and regulatory reform have made the state the envy of America and a magnet for business, capital and talent. California’s emphasis on government-provided benefits has accomplished the opposite.

In the last six months alone, there has been a massive shift in public opinion toward the Texas model. One of the best proofs is the recent CNN poll showing that 56% of the public opposes the administration’s stimulus plan. Only 42% support it. Back when the stimulus bill was signed into law, polls showed 54% support.

This doesn’t mean that President Obama will pivot to the center as Bill Clinton did in similar circumstances. In fact, Obama proposed massive new spending in the same SOTU in which he promised a spending freeze. The most revealing increase was his plan to further subsidize student loans. He wants to limit loan payments to 10% of income above a basic living allowance and forgive remaining debt in 20 years. The telling part of his plan is that those working in “public service” would have student loans forgiven in half the time, after only 10 years. Remember, public service workers already earn, on average, about $20,000 more per year than private-sector workers.

While the president clearly values taxing consumers more than producers, the public won’t stand for it. This is the basis of my optimism. We don’t need a full economic recovery for transformational stocks to prosper. All we need for money to move is investor confidence in the direction of governance and markets. It will come.

Right now, however, there are the triple overhanging threats of a government health care takeover, the cap and trade scheme and new bank taxes. For certain, however, cap and trade is dead. Though America’s mainstream media are still in denial about the collapse of the anthropogenic global warming (AGW) edifice, most of the rest of the world is not. Particularly in India and China, where most growth in carbon production will take place for some time, global warming is increasingly viewed as a failed scam. Here’s an English article from the Indian magazine Open to give you an idea of the tone.

Health care “reform” will certainly not pass in the form desired by the most extreme proponents. Increasingly, in fact, it appears that it won’t pass at all. I am, by the way, in favor of actual reform centered on limiting malpractice lawsuit abuse. Estimates are that we could cut American health care cuts by $3,000 per person per year on average through tort reform. This would eliminate much “defensive medicine” and lower insurance costs substantially. Americans favor this approach by wide margins, especially among the “Tea Party” movement. I expect it to move forward after the 2010 election.

Incidentally, I want to remind readers who went to last year’s conference in Vancouver that Chris Mayer and I were right about the burgeoning Tea Party movement. Today, it polls better than either the Republican or Democratic parties. Back then, our prediction that it would be a major political force was dismissed by others on our final panel.

In short, there is much reason for optimism right now. The trend lines are extremely positive and will begin to yield real benefits soon. Our debt level is seriously awful, but not worse than it was at the end of World War II. America is going to suffer the consequences of an unnecessary excursion into California-style liberalism, but we’ll come out stronger than ever. Moreover, we will be helped by a huge international market that did not exist in the late 1940s, when our economy was powering ahead.

For transformational profits,
Patrick Cox

February 9, 2010

P.S.: Shortly, investor fears are going to be calmed and the truly revolutionary technologies that will power the next period of economic super growth will accelerate further. In fact, legendary analyst John Mauldin is predicting a full-fledged biotech bubble in the years to come. I’ve been privileged to get to know John recently. We’ve been working together on a few projects, and he’s been buying some of our biotechs. I should point out that to avoid conflicts of interest, I cannot own any of our stocks.

Why the State of the Union Was Good News for Tech Stocks was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

Although the historical government solution to unsustainable government debt loads has always been the destruction of the debts by currency depreciation and eventual hyperinflation, there is always an intermediate step used to buy more time for the politicians in power. This action, usually sidestepped and downplayed by the establishment historians paid to hide the real facts of history is wealth confiscation. Napoleon had it right when he stated, “History is a state of lies agreed upon.”

The largest source of liquid private wealth remaining in the United States are the $15 trillion in private retirement funds and the ultimate ownership, control and future of these funds have already been compromised and exchanged for the favorable tax treatment of private retirement plans. Congress writes the laws, so they can tax, penalize, hold your funds hostage and although they’d never use the word, “confiscate” your assets at their discretion.

The retirement trap I’m writing about is only a proposal at the present time and since it may well begin in the latter years of the Obama Administration assuming the Democrats can somehow maintain their majorities in Congress, I’m calling it the “Obama Retirement Trap”. But make no mistake, the government need for current revenue and their frenzied search for a short-term fix to fund a backstop of liquidity to buy future government debt obligations when no credible investors will buy them is an unspoken quest of both political parties. The establishments of both political parties will do anything to stay in power and this will include raiding and pillaging your retirement funds.

Washington Proposals for a Mandatory Guaranteed Retirement Annuity

The government is getting ready to use that power and in a remarkably cunning way.

The prototype for their plan was devised in 1991 by Alicia H. Munnell, then Director of Research for the Federal Reserve Bank of Boston. She presented the idea in a paper entitled “Current Taxation of Qualified Pension Plans: Has the Time Come?” Later she was promoted to Assistant Treasury Secretary, and along with Robert Reich, Henry Cisneros and Hillary Clinton, she began to plot a raid on retirement funds. One element of the scheme was to create a Mandatory Pension System and fund it with a one-time 15% tax on retirement assets and a recurring 15% tax on retirement plan income.

I warned about this in my 1994 book, “Escape the Pension Trap”. Fortunately, the GOP election victory that same year derailed the Mandatory Pension System.

Guess what? It’s back… and nicely repackaged. It’s back because, due to slumping tax collection, Washington is on a desperate search for a new revenue stream. And this time they don’t want to just tax your retirement assets, they’re out to take them.

Teresa Ghilarducci: The New Architect of the Retirement Plan Wealth Attack

The latest leftist plan first appeared in 2007 at the Economic Policy Institute: Agenda for Shared Prosperity. In 2008, she became the new Director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research. In her book, “When I’m 64: The Plot Against Pensions and the Plan to Save Them”, she hypes her retirement solution for millions who do not have adequate retirement savings and her solution is to confiscate most of the retirement assets of successful Americans.

Here’s her plan…

Each year, the government will put $600 into a Guaranteed Retirement Account for you and every other working person in America. If $600 amounts to more than 5% of your annual compensation (if you earn more than $12,000) you will be required to contribute 5% of your total annual compensation to the GRA. The Feds will promise to pay a 3% “inflation adjusted return” on each GRA, based on the government’s Consumer Price Index. When you retire, you receive a portion of the account each month. Then — get this — when you die, your heirs receive only 50% of what’s in your GRA. The rest goes to Uncle Sam. Remember, this is the good news!

Next…

Following the introduction of Guaranteed Retirement Accounts, the next step will be to cap the tax deduction for annual contributions to existing private retirement plans at 5,000. (Many Americans will support this, given the hostility to the well-publicized Wall Street mega-bonuses and retirement plans.) Next will be a tax on every retirement plan’s income, to provide an immediate flow of revenue to the Feds. Finally, there would be a prohibition on buying any non-U.S. investment for any retirement plan.

What Would Spark This Nationalization?

A plan this radical can’t just be slipped through Congress. It can only ride into law on a first-class national crisis. Have you noticed that somehow the politicians are always able to find one when they need one.

• Loss of Triple-A Status for U.S. Treasury Bonds

The loss of triple-A status for Treasury bonds is the most likely trigger. And according to Steven Hess, Moody’s lead analyst for the U.S., it’s not that far-fetched. He states, “The AAA rating of the U.S. is not guaranteed. So if they don’t get the deficit down in the next 3 to 4 years to a sustainable level, then the rating will be in jeopardy.”

• Terrorist Attack or Military Disaster

A terrorist attack or a military disaster like the collapse of Pakistan or an Israel/Iran conflict and disruption of oil shipments could close American markets just as we saw in 2001. That would create a financial crisis over night.

• Another Economic Meltdown

After years of deficits, the greatest hazard to our economy is a run on the dollar and on Treasury securities by foreign investors. Although America’s foreign creditors don’t want to start a run on Treasury debt — they prefer a slow, orderly retreat — no one intends to be the last to head for the exit. Political or economic pressure in Asia could force Japan or China to take immediate action and dump our debt and knock the prices down to fire-sale levels.

What happens if China decides to cut its losses on U.S. Treasuries and issues a $100 billion sell order? That’s only 10% of their holdings, but it could set off panic selling of dollar-denominated bonds and crush the U.S. stock market like an egg shell. Mortgage rates would spike, which would suck the housing market into another air pocket. The President would probably sign an Executive Order closing the markets until order could be restored.

Any of those events would take place in an atmosphere of deep public worry and fear. That’s when Washington would come to your rescue and guarantee to restore your retirement funds back to a “pre-crash” level. How nice, right? However, in exchange you would need to “voluntarily” move your retirement assets into your new Guaranteed Retirement Account.

For those who don’t sign up for a GRA because they’re not fooled by the carrot, there would be sticks to consider.

1. Additional withdrawal penalties and taxes on their retirement plan.
2. Limitations on permissible investments — nothing that isn’t “in the public interest.”
3. Mandatory minimum holdings for targeted investments, such as Treasury obligations.

Remember, these retirement proposals are just in the discussion stage but progressives are promoting this confiscation agenda to the Obama Administration as a new source of revenue for a bankrupt federal government desperate for additional sources of revenue.

When the next economic or stock market crisis hits, your retirement assets will be at risk from this type confiscation effort regardless of whether the Democrats or Republicans are in control.

The Confiscation Event

At some time during the next decade, a global run on treasury debt and the dollar will also likely take the American stock market down past lows not seen since the financial meltdown crisis in 2008 and 2009. The 50% to 75% stock market pullback during the actual bankruptcy of the Washington debt and paper dollar will send shock waves through retirees and current plan participants as their private retirement plan balances plummet.

At this time, Washington will come to the rescue and guarantee all private retirement plan market values back to pre-crisis levels. The gullible American public will overwhelmingly support this effort by switching their dwindling funds into the Guaranteed Retirement Annuity managed by the government. For the first few years, Washington will probably label those few of us who warn that that Americans have lost their retirement benefits as extremists, Ron Paul paranoids and Tea Party advocates.

Then it will become crystal clear to all Americans that their retirement benefits have been given away for a promise by an evil group of plunderers who have never in their history kept a promise, a guarantee or their word on anything. The greatest theft of wealth in the history of the world will have taken place and only those few who heeded an early warning will still have their retirement benefits and security.

Regards,
Ron Holland

January 21, 2010

Prepare Now to Escape Obama’s Retirement Trap was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

Yet, when it comes to reforming healthcare OBAMA DEMANDS WE RUSH. Instead of doing it right, he demands we do it fast. Even if it means an incompetent, bumbling, hapless, and corrupt federal government might take over 17% of the U.S. economy. Even though government-run Medicare and Medicaid already threaten to bankrupt America with waste, incompetence, theft and corruption. Even though the federal government has never before run anything successfully, efficiently and profitably. What kind of madman would rush this decision on adding trillions in new spending on a risky unproven scheme in the midst of the worst depression since 1929 (and in my opinion it is getting worse)? If there was ever a decision needed to be made right, rather than fast, this is it.

So why the rush? Obama knows anyone with common sense that has time to think about this plan (let alone read the actual bill), would never support it. Certainly not now in the midst of economic Armageddon. That is why Obama, Pelosi, and Reid are demanding Congressmen and Senators vote on it before they read it…and before we (the voters) hear about the details – the massive new taxes, the onerous new mandates, the rationing, the criminal penalties, he dramatic expansion of Big Brother in our lives.

The vote must happen before the average distracted American voter realizes they will be forced to buy health insurance or be fined $15,000 or sent to prison; before Americans realize 50 million patients will be added to an already overloaded, overburdened healthcare system – while adding no new doctors, or worse yet, causing tens of thousands of doctors to retire rather than work for lower wages, higher taxes, and heavier workloads; before anyone realizes that you don’t save money by spending an extra trillion dollars; before anyone realizes that government “experts” have always far underestimated the cost of every new proposed government program – in order to sell it- often by 10 times or more.

Do you need to know anymore about the reason Obama is rushing this pig of a bill through Congress? But there is more. Obama is afraid that Americans will realize the Senators and Congressmen, who are being threatened and bribed to vote for universal healthcare, know it is so bad that they themselves REFUSE to live by it. They have their own healthcare plan – no rationing or higher taxes (or both) for them.

Obama must rush the vote before anyone realizes he will not dare tax the top-of-the-line private health plans that could actually pay for this big government boondoggle – because those plans belong to the union members that supported Obama for President. Obama is owned lock, stock and barrel by the government employee unions, teachers unions, and auto unions.

And finally, Obama wants to rush through universal healthcare before anyone realizes that the taxes and surcharges to pay for it will cost millions of jobs and huge tax increases on EVERYONE!

The definition of a Ponzi scheme is to steal from one group of suckers to pay another. Eventually all Ponzi schemes fail – when you run out of suckers. In this case, the suckers are American taxpayers. Obama says only the rich will pay – don’t believe it. A program this big and corrupt will hit everyone, regardless of income in their pocketbook. The rich will certainly be hit. Some will retire; some will move offshore; some will go underground; some will cut back on hours because the reward is no longer worth the risk; and many will go out of business under the new burdens. Obama will learn that you CAN kill the goose that laid the golden egg.

The damage done to the rich will reverberate in deadly fashion to the middle class. First, jobs will be lost by the millions. Yes, millions MORE jobs than we’ve already lost. As my father used to say, “I’d love to hate the rich, but I’ve never gotten a job from a poor person.” And, when the tax revenues necessary to fund universal government-run healthcare fail to appear (because the rich have gone out of business, or refuse to work), Obama will turn to the middle class to pay the bill. It may take 5 years of massive, unimaginable budget deficits, but soon enough the middle class will be asked to pay dearly.

Disaster looms. Don’t say you weren’t warned. The only bright lining is that the end of Obama and Pelosi’s reign looms too. From now on, let’s call a vote for universal healthcare “Nancy Pelosi’s Congressional Death Panels.” Political suicide awaits the Democrats foolish and arrogant enough to pass this bill.

So, now you can clearly see why Obama can wait with a decision regarding Afghanistan (while our sons and daughters are fighting and dying), but he has no choice but to rush a vote on universal health care. Many of you may think it’s because Obama and his minions are inept. Well, they may be, but they are also disastrously devious and know the way to get “the worst bill in the history of America” passed is by rush, rush, rush, and what better time than when Americans are distracted by the Christmas holidays.

Regards,
Wayne Allyn Root

November 23, 2009

The Damage We Can Expect from Obama’s Rush to Universal Healthcare was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

Those tuned into the media-waves were enchanted, in a related instance, by Rick Santelli’s grand moment of theater in the Chicago trader’s pit last week when he seemed to ignite the first spark of revolution by demonstrating that bail-out fatigue had morphed into high emotion — and that the emotion could be marshaled against public policy. The traders in the pit on-screen seemed to color up and buzz loudly, like ordinary grasshoppers turning into angry locusts preparing to ravage a waiting valley. “Are you listening, President Obama?” Mr. Santelli asked portentously.

In the broad blogging margins of the web that orbit the mainstream media like the rings of Saturn, an awful lot of reasonable people have begun to ask whether President Obama is a stooge of whatever remains of Wall Street, with Citigroup and Goldman Sachs’s puppeteer, Robert Rubin, pulling strings behind an arras in the Oval Office. Personally, I doubt it, but it is still a little hard to understand what the President is up to. For one thing, the stimulus package, so-called, looks more and more like national sub-prime mortgage itself, a bad bargain made under less-than-realistic terms, with future obligations fobbed onto whoever inhabits this corner of the world for the next seven hundred years — and all to pay for a bunch of granite counter-tops and flat-screen TVs.

I suppose Mr. Obama is burdened with the knowledge that the economic truth is so much worse than he imagined back in November that there is simply nothing to do at this point except pretend to serve up a “tasting menu” of rescue plans in the hope that markets and mechanisms might be conned back into compliance with our wish keep getting something-for-nothing forever. FDR already used the fear of fear itself trope, so Mr. O is left with little more than displaying pluck and confidence in the face of overwhelming bad news.

The sad truth is that banking has become a Chinese fire drill — a frantic act of futility — as insolvent companies persist in covering up their losses in order to avoid the counter-party hell of credit default swaps that would ring the world’s “game over” bell. This can only go on so long. All the chatter about “nationalizing” the banks really boils down to what kind of bankruptcy work-out will they be put through, how destructive will the process be, and how much of the pain can be shoved forward in time to people now in diapers and their descendants.

Among the questions that disturb the sleep of many casual observers is how come Mr. O doesn’t get that the conventional process of economic growth — based, as it was, on industrial expansion via revolving credit in a cheap-energy-resource era — is over, and why does he keep invoking it at the podium? Dear Mr. President, you are presiding over an epochal contraction, not a pause in the growth epic. Your assignment is to manage that contraction in a way that does not lead to world war, civil disorder or both. Among other things, contraction means that all the activities of everyday life need to be downscaled including standards of living, ranges of commerce, and levels of governance. “Consumerism” is dead. Revolving credit is dead — at least at the scale that became normal the last thirty years. The wealth of several future generations has already been spent and there is no equity left there to re-finance.

If contraction and downscaling are indeed the case, then the better question is: why don’t we get started on it right away instead of flogging rescue plans to restart something that is DOA? Downscaling the price of over-priced houses would be a good place to start. This gets to the heart of Rick Santelli’s crowd-stirring moment. Let the chumps and weasels who over-reached take their lumps and move into rentals. Let the bankers who parlayed these fraudulent mortgages into investment swindles lose their jobs, surrender their perqs, and maybe even go to jail (if attorney general Eric Holder can be induced to investigate their deeds). No good will come of propping up the false values of mis-priced things.

No good, in fact, will come of a campaign to sustain the unsustainable, which is exactly what the Obama program is starting to look like. In the folder marked “unsustainable” you can file most of the artifacts, usufructs, habits, and expectations of recent American life: suburban living, credit-card spending, Happy Motoring, vacations in Las Vegas, college education for the masses, and cheap food among them. All these things are over. The public may suspect as much, but they can’t admit it to themselves, and political leadership has so far declined to speak the truth about it for them — in short, to form a useful consensus that will allow us to move forward effectively. One of the sad paradoxes of politics is that democracies do not seem very good at disciplining their citizens’ behavior. The wish to please voters and the influence of campaign money overwhelm even leaders with mature instincts. In America’s case, this could lead to what I like to call corn-pone Naziism a few years down the road. Someone will design snazzy uniforms and get us all marching around to “God Bless America.” At the point of a gun.

It’s not too late for President Obama to start uttering these truths so that we can avoid a turn to fascism and get on with the real business of America’s next phase of history — living locally, working hard at things that matter, and preserving civilized culture. What a lot of us can see now staring out of the abyss is a new dark age. I don’t think it’s necessarily our destiny to end up that way, but these days we’re not doing much to avoid it.

Regards,
James Howard Kunstler

February 24, 2009

Sustaining the Unsustainable: The Abyss Stares Back was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

We’ve lived through eight years of the threat from the Right. It was all about nationalism, militarism, war, torture, state secrets, attacks on privacy, the use of tax funds to subsidize “conservative values,” the outsourcing of government in a fascistic business-government partnership, the banning of products and services that government doesn’t like, the regimentation of educational life, government impositions in the name of security, and so on.

With the end of the Bush years, many of these threats have receded, if only slightly. Consider the problem of nationalism, for example. The neoconservatives who ran the country during the last two Bush terms exploited this dangerous impulse for all it was worth.

If you were not for their wars, you were against America, and hence deserving of jail without trial. The whole ideological apparatus of the Bush years was profoundly anti-intellectual, and while the neocons shouted down anyone who compared their administration to the Third Reich or Mussolini, the ideological comparison was actually quite apt: right-wing government control stems from the same motives of exalting security, discipline, and chauvinism above liberty.

In two short months, however, that ethos has subsided, and it has been replaced by a threat from the Left. It is tragic that Obama should be president at all. If we had a position called “national well-wisher,” “national greeter,” or “national symbol of accomplishment,” he would be perfect for the job. He is elegant, graceful, and articulate, and he inspires people in an unusual way. As chief policymaker, however, he has revealed himself as nothing more than a two-bit socialist.

After all the ghastly statism of the Bush years, you might think that the Left would back off from using power to achieve its aims. Instead, they have learned nothing. The Left has been lying in wait for its chance. As the Obama people entered the White House, it was as if they found a closet labeled “failed ideas of the past.” They opened it and the contents spilled everywhere. They started grabbing things and putting them in the regulatory books and in legislation.

What an amazing pile of junky, worn-out, bogus policy ideas! Equal pay for equal work. Infrastructure spending. More money to the public schools. Socialized medicine. Rock-bottom interest rates. Welfare! Every wish granted by government. Down with business. Down with business failures. Curbs on fat-cat pay. Down with Wall Street. Turn on the money spigots. Expropriate the expropriators. Subsidies for every lifestyle that flies in the face of bourgeois prejudice.

Thus are we again reminded of what a profound threat the Left represents to liberty. It’s been more than a decade now since we’ve seen this at work, and probably longer really. Clinton was a pain, but he was smart enough not to take his reigning ideological framework too seriously. He actually showed some deference to reality from time to time.

The Obamaites are different. They are woefully ignorant of economics. They seem to actually believe all that socialist claptrap that has provided an excuse for innumerable foreign dictators: the idea that government is the source of wealth and can make anything happen with the push of a button.

They see no limits to the possibility that government can make society perfect, righting every perceived social injustice, and bringing prosperity to all via stealing from the haves and giving it to the have-nots. Is there inequality? Mandate equality. Is there deprivation? Provide! Recession? Spend hundreds of billions!

What we have here is not just a profound love of the state; it is a profound confidence in the capacity of the unlimited state to create heaven on earth. How does this square with the idea of human liberty, of social cooperation, and of the rights of all? Herein lies the great mystery of leftism. The Left seems oblivious to the relationship between their chosen means and their ends. It’s not that they hate liberty as such; it is that they believe that it must always take a backseat to other social priorities, like equality. In the end, they have a tendency to build the total state and find themselves taken aback when the whole of society ends up in a cage.

Those Obamaites! So compassionate, loving, universally minded, progressive — except that their ideological cousins managed to starve and destroy whole civilizations. Loyalty to their creed means death, because their ideology is the pathway to the gulag — and for one simple reason: their preferred means of social change is the state. The state is always and everywhere a threat to liberty, and liberty is the basic building block of prosperity and civilization.

Despite the slogans about progress, the upshot of the Obama administration is as deeply reactionary as anything that Bush conjured up. Despite all the hype and hope, what Obama offers is nothing new. It amounts to the robber state and the regimentation of society, a plan that will kill off prosperity and the conditions that allow for it.

The Republicans are right to fight this tendency at every turn, for it represents a radical attack on all things truly American. Worse still, by playing with the printing presses, the policy tendency here is also deeply dangerous. It could destroy the dollar internationally and domestically, igniting a hyperinflation that no one will be able to control once it gets going. One only wishes that the Republicans had been so principled when their president was in charge!

The Obama administration says that we have to give the stimulus time to work. No need. The stimulus will not work. If we manage to pull ourselves out of this slump, it will be despite and not because of this stimulus package.

When putting together my book, I wondered which threat was actually more dangerous for us, the Right or the Left. I’m still not sure, for national socialism and international socialism are in close competition. I ended up focusing on both. It’s a hard truth for Americans to face that neither team in Washington is going to guard what we love the most. That is something we are going to have to face. Liberty is for the citizens to guard themselves.

Regards,
Llewellyn Rockwell
LewRockwell.com

February 18, 2009

The Left in Power was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

“I have a cold. I don’t feel very well.”

“But about the election? About Obama?”

“Well, it’s great that a black man can be elected President in America. But it doesn’t exactly expiate the great national sin of slavery does it? Martin Luther King said he dreamt about an America where a man could be judged for the content of his character and not the color of his skin. But it looks like most black people voted for Obama because he’s black, not because of what he believes. Not that it bothers me much. It’s probably a great thing that 12% of the American population woke up today and felt like they belonged to an America where anything really is possible. It may be the first time many of them felt that way. It’s great.”

“That doesn’t sound so optimistic.”

“It’s realistic. It is what it is. If people were proud of America for seeing past race, well then I reckon American could justifiably be proud for surprising the world again. But from what I saw, people were more proud of Obama than they were for America.”

“So what?”

“So that’s the takeaway from this election. This election wasn’t about the deficit, global warming, or the neo-cons. It was about a vote people could make to feel better about themselves. Obama offered people that chance. The Republicans got exactly what they deserved for betraying small-government, fiscally-conservative, sound-money and non-interventionist foreign policy principles. But they also underestimated how badly people want to believe in something today. This election was all about pathos, not logos.”

“You make it sound like it was a Greek tragedy.”

“More like a comedy. It wasn’t a campaign at all. It was one long personal narrative, a two-year reality TV show with some world-class editing and producing. Barrack Obama convinced people that his story was America’s story. Once he was able to sell them that story, there was only one way it could end. Americans love a winner.”

“But isn’t he like a black Kennedy?”

“I have no idea what that even means. Race still matters in America just like religion still matters. The things that make us different aren’t always bad. Besides, that just sounds like a bunch of romance and nostalgia from people who have always wanted believe that a dynamic leader could take us toward better, more enlightened government. Don’t these people have romance and drama in their own lives? Why are they living vicariously through Obama’s life? I understand wanting to be a part of something greater than yourself. That’s why I work on the Daily Reckoning. But anytime people feel like that, they usually end up doing something stupid like burning books or drinking Kool-Aid.”

“Not always. The Civil Rights movement was about being part of something greater than yourself. That turned out okay.”

“Of course. But look, all I’m saying is that this wasn’t a transcendent election. It was a synthetic election. The power of America’s mass media and entertainment image-making machine was harnessed to a candidate for national office. Obama became a feel-good brand that would magically repair America’s damaged reputation in the world and her economy at home. But the Obama brand has all the depth and staying power of a catchy pop tune. It’s like Mountain Dew, all sugar rush, no nutritional value. You feel better but you’re not getting any healthier.”

“You sound bitter. Or drunk.”

“Not at all. Just a little alarmed. Modern politics is about the manipulation of people’s emotions (fear, hope, anger, envy, and sloth) through words and images and really compelling but hugely false promises. The Obama campaign was a masterpiece in manipulation, a triumph of style over content. McCain just couldn’t find a big enough lie to latch on to. The campaign also represents the triumph of the cult of personality in American politics. And anytime people have faith in a man over faith in ideas, it’s dangerous. We’re supposed to be a nation of laws, where our ideas — equality before the law, opportunity, freedom of speech — command our loyalty.”

“You’re just a sore loser.”

“Hardly. I lose all the time. I’m used to it. And you know I don’t even believe in voting. In fact, that’s what’s sad about voting. The high voter turnout was a disaster for people who love liberty.”

“How can you possibly say that? Isn’t voting an obligation in a democracy? I think it’s great so many Americans finally cared about who leads them.”

“I said I love liberty, not democracy. Do you think high voter turnout ensures that you get a better result or better government? Harrumph! When people turn out in such large numbers, it’s a triumph for State power. It means that people who believe the government should have a great role in your life have succeeded in politicising ever greater aspects of private life. Every problem becomes political. And every solution requires a new law. Yesterday we learned that most Americans believe in big government power, they just disagree about whom it should be directed against.”

“That’s awfully cynical.”

“Ask yourself why people have so much secular faith in politics and in ‘transcendent’ men like Obama. Why? It’s because for the last one-hundred years, people have lost their faith in the institutions which used to give their life meaning and purpose…things like family, community, the local school, or the local church. All those relationships have become lost because they’ve become Federalised, with Big Government as the mediator. I say lost, but I think that those kinds of voluntary associations have been deliberately undermined by people who believe in the pursuit of government power to enforce their moral outlook on the world. The entire world.”

“Now you sound like a freak.”

“What’s new? But hear me out. You could argue that it’s a biological imperative for us to believe our lives mean something. For some people, having children — the ultimate vote of confidence in the future — is one of way giving life purpose and meaning. But take someone like Viktor Frankl. He survived the Holocaust. He says that men can find meaning in their lives in three ways. First, through work that matters. Second, through relationships with other people. Third, through the attitude which we choose to have when we encounter the suffering life inevitably throws our way.”

“So?”

“Well, today people are largely alienated from their work. Not to sound like Marx too much. But we see work as something we must do to pay off the mortgage. We don’t see work as…the work we want to do with our lives. So most of us don’t find meaning in our work. It’s labour with sweat but no fruit.”

“What about family?”

“We all live alone in little cubes and sit in front of our fake campfires (televisions) while e-mailing and texting each other constantly. We’re completely free to pursue our individual goals and desires and selfish pursuits. And we have more ways than ever to communicate. Yet we find ourselves more alone and more medicated than ever.”

“You’re depressing me, man. Do you want another beer?”

“Let me just finish this bit about suffering, then we’ll have some whiskey. We don’t suffer anymore, at least not most of us in the Western world. We were born into a world of plenty. Plenty of energy. Plenty of credit. Plenty of food. Plenty of surplus. Suffering, in the modern world, has no redeeming value. No value at all. To the extent we do it at all, we do it voluntarily in the gym, on the tread mill, or perhaps in the commute we are forced to endure to get to work. But those are just superficial kinds of suffering. They aren’t in the service of any worthwhile purpose which makes us feel like our lives have meaning.”

“What does any of this have to do with Obama?”

“He made people feel like their lives had meaning by voting for him. I don’t know how he pulled it off. But people used to find meaning in day-to-day relationships. Family, friends, neighbors. The cult of individual materialism and Nanny State paternalism has made the relationship between a man and his government the most important relationship in the modern world. I find that utterly depressing. I’m thinking about getting a dog to protest.”

“So what is your point?”

“People are going to be disappointed. Some of them will be devastated. Exalted political rhetoric can make you feel good for a while, the way you might feel when your sports team wins a championship. But the sun comes up the next day and your life is still your life, with all its challenges, fears, and opportunities. Obama can’t live it for you. He can’t pay your mortgage, fuel up your car, make you feel better about your job, your love life, or your relationship with your parents and kids. Your life is still your own. Like my mom used to day, wherever you go, there you are.”

“I disagree with you on the mortgage part. But I see what you’re saying. You should stop drinking beer. Look what it does to your gut. Why don’t we go to the gym tomorrow forget this conversation ever happened?”

Regards,
Dan Denning
November 13, 2008

What the First Black President Means for the U.S. was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.