Author: White Whale

Maxim One: When Aggregate demand falls, stimulate debt.

Maxim Two: When this doesn’t work, expand government.

Maxim Three: When you control all aspects of the private economy, you control the polity, and all the people in it.

It has long been my view that most contemporary American movies teach some silly things about life. Particularly, virtually every action movie–and a not inconsiderable number of other types of films, including dramas and comedies–will have a plotline which goes something like: bad guy does something bad, good guy appears and has small success, setback, another success, setback, apparently large success, huge problem–everyone tied up, with the villain ready to do whatever bad thing he was going to do–then POOF, a miracle.

In Jonah Hex, there they are tied up on the boat, and she gets loose, and they somehow have no guards watching them. It reminds you of the scene in Austin Powers where Dr. Evil’s son is telling him just to shoot Austin, or at least watch the seabass with lasers kill him, but he refuses, and of course Powers escapes, as of course did James Bond.

Harry Potter makes a silly error, jumping into a frozen lake by himself. Ron appears from nowhere, to save him. They get themselves incarcerated, then POOF–literally–Dobbie appears.

The subtext of this theme, repeated ad nauseum, is that no matter how bad the spot you get yourself into, somehow, something will happen. This does happen in the real world, but it is not a plan, and it is not common. A homicide cop once told me that most of the time the person who looks like they did it, did it. And most of the time what ought to happen–given a set of social, economic, and political circumstances–does. Unless those with principles have spent a long time and lot of effort sculpting things their way, things won’t go their way.

All nations end. This is a historical fact. At some point–2 years or a 1,000 or 10,000 years from now–America will be a largely forgotten memory. The human race itself may be gone.

So in looking at the future, we need to remember it is not a question of if, but when. And given that, we need to not foolishly place our faith in some savior to appear from nowhere, but in prior proper planning combined with energetic execution.

I need to do some thinking out loud. The following may be a bit stream of consciousness, but will hopefully be useful.

The Fed in theory can only buy outright US Treasury Notes, and post-1980, foreign bonds, or bonds backed by foreign governments, which is a large grey area, which patently includes foreign currency like the euro–a unit of value backed by the EU–and seemingly investments in the IMF and World Bank.

Now, that last is an interesting area. Neither actually reports to a government. It is basically a bankers club which was birthed with taxpayer money, and gone on its merry way. But patently we pay into the IMF. We Americans are paying for a large share of the EU bailouts, via the IMF.

How does the purchase of Treasury Notes create money, though? Say I am a bank. I buy $10 worth of Treasury bonds. That $10 goes to the government, and right back out into circulation via government spending. The Federal Government is a voracious creature, which can easily suck up and spend every dollar given it. That $10 existed when I spent it, in exchange for a security that will pay me over time some amount of interest.

Yet when the Fed buys the Treasury note (the precise term may be bond, but basically we are talking about a piece of paper stipulating a claim on future revenue of the United States govt, which is to say future taxation) it creates another $10. Thus now $20 are in circulation. This is how Open Market Operations create inflation.

But the Fed also seems able to abuse at will the Discount Window. They can apparently decide to extend the term of the loans at will. They did this in 2008 and 2009, and are probably doing it today. They created something called the Term Auction Facility, by means of which they can offer 1 to 3 month loans, seemingly to anyone, and certainly including foreign banks. Since such loans would be renewable, this is a de facto ability to “lend”–which is to say create–any amount of money and give it to anyone. I have missed this point up to now. I can now see no limits on their ability to create money and disburse it to anyone.

This is particularly bad since they can collaterize such loans, which is to say stake a claim on a car, house, company, or nation, perhaps via the IMF, perhaps directly. And if they “repossess”, say, a bank, what happens? Who actually gets it?

Who, really, IS the Federal Reserve? They have their own buildings, but they are “owned” by member banks. If the Fed makes a loan to some obscure bank in, say, Asia, and the bank folds, do they get a claim on the assets of that bank? Its remaining loan portfolio? Does that go to a member bank, or does the Fed go into the business of owning foreclosed homes and office buildings? These are interesting questions, for which I have no answer.

And when the Fed buys up Treasury Notes, they buy them from anyone. They may well be buying up Chinese held Treasury notes. The Chinese government will then have put money into circulation here via our government spending, but will keep the money the Fed gives it, to be reinvested in China. We may, in fact, be helping the Chinese reduce their stake in US bonds. We don’t know. Bernanke announced the bond purchases, but how will we really know where the money goes?

Are we at the dawn or dusk of our civilization? I was asking myself that question, and realized that in a thousand minds, we might find a thousand conceptions. For some, we living in the dark, waiting for dawn. For some, it high noon. For many, we are in decline, and the sun is going down.

As I thought about it, though, I decided that the “sun” in our imagination moves spaspodically, in quantum leaps that correspond to paradigmatic revisions. Was Louis the Quatorze (I think that is right) not the “Sun King”? Yet did not the idea enter the French consciousness that they were living in darkness, and needed the “dawn” of revolution? (Note: not all revolutionaries were lunatics or criminals: the moderates got killed by the radicals, in a pattern which has since repeated many times.)

And if we use the metaphor of a cycle of darkness and light, has there not always been some sun rising when some other sun had set? As the Western Roman Empire was becoming moribund, and evolving into the universal “Catholic” Church, was not Islam expanding?

And it’s a funny thought to think, but Muslims were likely much physically cleaner than their Christian counterparts, who had no equivalent in their Bible for the Koranic “Cleanliness is next to godliness.” If I’m not mistaken, bathing was considered unhealthy for much of the Middle Ages, likely in part due to the prevalance of water contamination.

What I am trying to do with this Goodness idea, is set the sun back to dawn; to set our perceptual filters to the idea that whatever our progress to date, we can do infinitely better in the future. We are not at the end of a civilization, but contemplating the creation of the first truly just universal order this benighted planet has ever seen.

America was clearly conceived as a Christian nation, within which the tolerance of Christian charity would be practiced. Yet I would like to see us evolve past this. I have significant problems with received Christian doctrine.

For example, why would a just God require killing in his honor? Why would we need to ritually slaughter animals, as the Jews did? Tenfold: why would we need to ritually slaughter a human being?

Theologically, if one accepts the doctrine of free will, then it would follow logically that those who wrote the Bible were acting as individual, fallible human beings, and as such likely screwed up the actual message of Jesus, to a greater or lesser extent. Add to this the power aspirations of the Catholic Church, and you have a powerful incentive both for suppressing non-conforming views (with violence, as happened often), and for supporting views which likewise support your position of authority.

As far as Islam, the core, necessary contention is that God is one, and not many. I am quite willing to accept that, but not that God has a name or gender. God is what God is (this is, I think, close to the meaning of Yahweh), and our task is to see this force for ourselves, and bring it to earth, and use it for Good.

Thus, what I would like to see in the day we begin after we renounce all remaining vestiges of darkness–embodied most fully at the moment in the spirit of political totalitarianism, and the docrines which derive this idea–is a wedding of sincere goodwill, and open use of science for human improvement. Science is and always will be subordinate to creative, directing spirits. It cannot solve problems of meaning for us. Yet it can, in my view, bring the realm of God closer to Earth, by helping us understand how we are all connected, and what happens to us when the forms we use on Earth stop working, and our consciousness moves on.

God, in my view, is composed of two parts, which I have called (after the Chinese) chi and li. God is the matter/energy “stuff” of which the universe is composed. God is also the possibility of form. In our “chi” self, we are the same as God. We are composed of light. In our “li” self, we are unique. As I envision the matter, God does not “create” form, per se, so much as create a sort of sketchpad that retains shapes over time. God is mold with memory, perhaps.

Some passing thoughts. Hope they help someone.

Watched “Jonah Hex” tonight. I had in mind something easy, which was accomplished. Got me thinking about the stereotypical cowboy, taking on the world on his own. Obviously, this isn’t how things actually get done, in general, in the real world. Army, Navy, Air Force, Marines, Coast Guard: they work in groups. CIA, DIA, FBI, DHS, LEO’s: groups.

Yet this lone standout, this Gary Cooper in “High Noon” idea, has merit.

Ponder this: what if all 300 million or so Americans (whatever we are up to) thought independently? What if every man, woman and child in this country had an opinion on everything, which they were willing to share with the world, and expose to critical and positive scrutiny? Would this not be positive?

When selecting a decision path, people choose from available options. Regretably often, they choose from what they perceive as the middle of available options.

What if we were all truly individualists? This doesn’t imply selfishness, or ignoring social problems: on the contrary, individualism is a mindset in which any and all ideas are given a hearing, if there is a CHANCE that they might solve a problem which needs solving.

I see this stupid idea all the time, that individualism means selfishness. Here’s a newsflash for the dumb people of the world: Mother Teresa was an individualist. So was Gandhi. So was Martin Luther, and Martin Luther King, Jr. As far as that goes, so were Karl Marx and Lenin, even though they would not have used those words.

If you are perceiving as a sovereign intellect, you are an individualists. Conformity generates the repetition of ideas, but not the useful multiplication of ideas.

Clear enough? Now go generate some ideas of your own, dammit. Post them somewhere. Defend them. Learn something. I do this all the time.

I have never been happy in places where people agree with me. I like disagreement. I just got kicked off the Daily Kos, and can’t muster the time to deal with Media Matters. As far as that goes, I can’t even reliably post my ideas on supposedly conservative websites. Mildly frustrating, but I have outlets like this one.

If I reach a point where everybody hates me, though, I know I will have succeeded. That’s a tough nut to crack.

Wish me luck.

Editorial comment: I’ve been known to drink a bit of whiskey from time to time. This post was influenced by it. I won’t take the time to rub out the rough spots, but figured I’d add that by way of clarification.

From hate, hate. From love, love, indifference, and hate. One allows no possibility of a good outcome; the second, some possibility.

Socialism, at root, is a moral claim: that material goods are the only thing that matters in this world, and that their equal distribution is the foundational essence of any morality. Implicitly it is the claim that resentment of material or political inequality is an insuperable barrier to happiness.

From this, it is not derived the poor must be made wealthy, but rather that the wealthy must be destroyed. The foundational stance, quite obviously, is not a love of the poor and downtrodden, but an abusive and flagrant hatred of the rich. Socialism is not and never has been about helping people, but rather about punishing people.

This is shown clearly in the fact that their policies invariably result in general increases in poverty and economic stagnation. Conversely, free markets breed wealth. These facts are beyond dispute.

Socialism also results in GREATER political inequality, since the “Salariat” class (Keynes’ term, seen quite clearly in the policies of Obama in greatly expanding the pay and number of Federal employees in a time of economic downturn) brooks no opposition. They define themselves as right, and dissension as therefore intrinsically malevolent.

Let us take, though, an ordinary example. Someone kills or hurts a loved one, and is never punished. Given the season, let’s look at “It’s a Wonderful Life”. For those brought up in the current era, watching TV throughout the 70’s and 80’s, you end that movie with profound discomfort at the fact that Potter’s crime is never detected and punished. Saturday Night Live actually did a skit once, pointing this out.

Is it not very easy for us to forget the joy with which Capra ended the original movie, and transition seamlessly to anger and violence? Read the transcript and imagine the scene. Does that not better fit the sensibilities of our age?

Why is this? Is it not in part that enormous sections of our movie output–which is to say in large measure our de facto shared culture (you will be far more likely to get people to recite the final scene of “Play Misty for me” than scripture or Shakespeare)–are related to crime and revenge? You have the nasty bad person, who does something nasty nastily near the beginning, after which you spend the rest of the movie mowing through the seconary people–normally getting the number two person first–and finally the nasty person dies nastily, with justice.

What does this teach us about living with happiness? Nothing. What does it teach us about managing resentment? Use violence, if your cause is just (and are not all of our pet causes just in our rendering?)

Phrased another, way: INDULGE in your resentment. What was it our President taught people as a community “organizer”? What was he organizing? Directed resentment. He fired the flames of self pity and entitlement, then set groups of people loose in a given direction.

And it may be that some of his causes were in fact just. It may have been that there were correctible systemic injustices. But what are the long term effects of this sort of policy? The atrophy of innocence. The weakening of bonds of shared respect and loyalty. The elevation of social and political–and eventually physical–violence, to serve any end any person declares just for any reason.

I was a “victim” of the minutest of injustices the other day. I was doing work on a crowded jobsite, and needed to get my ladder at a specific spot for a moment. The owner, his wife, and (inappriately for a job site) his daughter were standing there, talking with the foreman. I asked them politely to move, and they ignored me, even though they plainly heard me. Subtext: I am a peon, they are important, and whatever it is I need to do can wait until the King and Queen are done with what they are doing. I only needed, actually, the wife to move something like one foot. I managed to squeeze in there, but she didn’t budge one inch, apparently out of principle.

I vacillated between indifference and anger, and found indifference the vastly more noble emotion. It was also much more comfortable and conducive with my own happiness.

On the one hand, if you never stand up for yourself, you will get walked over. At the same time, I think that we need all to understand that petty affronts to our self importance are painful–to us–and incompatible with lasting, deep affection for others, and our own happiness.

It sounds saccarine, but is nonetheless true for it, that George Bailey’s LIFE was much richer in every way than Potter’s. And it was richer for his lack of standing, daily resentment. Potter in effect killed his father. Yet the Bailey’s also created a lot of happiness and hope, too, that would have died (this is, after all, the point of the movie) had they not hung in there.

And I personally do believe in an after-life. I will say, though, that we should not concern ourselves even there with the punishment of malefactors. It really doesn’t matter. What matters is that good people get access to virtually unlimited happiness.

In a deep sense, “justice”, so called, only feeds our sense of self importance. Self importance locks us in a cage of permanent shadow. You need justice for social reasons–to maintain the peace–but you do not need it for personal reasons.

Love and joy constitute our real selves, and need to be pursued primarily, if not exclusively.

An ordinary–if distraught–man is sentenced to 7 years in jail for guns he owned legally: http://www.philly.com/philly/news/20101130_Family__New_Jersey_man_serving_7_years_for_guns_he_owned_legally.html

The simple fact of the matter is that guns decrease crime. Jamaica puts you in jail for years for the possession of a single bullet, and yet has one of the highest gun related crime rates in the world. Big factor: most of the police are corrupt. How do you defend yourself against a corrupt government? You don’t.

That’s why we have the Second Amendment, which was nothing less than another part of our checks and balanced system. Many of our Founding Fathers were uncomfortable with the idea of a standing military, since history had shown clearly that such militaries can be corrupted to support a corrupt government. To counterbalance this threat, they envisioned State militias, and universal access to gun ownership.

And to be clear, if you find yourself in a place with no crime, chances are good you are in the country somewhere, where most people in most states have multiple guns.

In my view, Congress needs to make a statement against all forms of restrictions of gun ownership. If it needs to be a Constitutional Amendment CLARIFYING the existing language of the Second Amendment, so be it.

If people are killing people, it is because our culture is in decline; and our culture is in decline because of the socialists who reject reason, custom, and common sense, in this area, as in all other areas where they render their asinine and perverse judgements.

I am involved in the contracting process quite often, sometimes with the Federal, State, and local governments. I’ve done business with all three. And I can say with absolute certainty that racial and gender preferences cost the American people money.

Case in point: my boss quoted some material to the government at price X. He also quoted it through pass-through that had some desirable minority trait–details vary, but in this case it was a disabled veteran–at price X plus 15% or so. They went with the second option, even though it was the same exact material. All that happened was the government signed a contract with the disabled veteran, and he signed a contract with us. He pocketed much or all of the difference. His job? Be a disabled veteran and be in the food chain. I see this all the time: one person companies that I call “cut outs”, who just flip contracts.

We need to call Affirmative Action what it is: an integral part of the political spoils system. If you’re black and you vote Democrat, contracts will come your way. Same if you’re a woman, or Hispanic, or transgendered bisexual performance artist.

The only conceivable case for Affirmative Action is to rectify racism. The simple fact of the matter is that there is NO evidence–NONE–that qualified people are being denied jobs or contracts based upon race. There is MUCH evidence that UNqualified people are being advanced due solely to their race. This is racism.

The secondary implicit argument made by advocates of Affirmative Action–never made explicitly, obviously–is that African Americans and Hispanics and women are too stupid and incompetent to survive an openly fair and competitive environment. I disagree with this assessment.

Yet, it is patently the case that people who are mollycoddled–who are taught shortcuts in the game of life, rather than the rules–develop bad habits of petulance, ingratitude, a sense of entitlement, and poor work ethic. All of these factors do lead to inferiority. This is not an outcome dictated by accident of birth, but accident of political and following social environment.

The simple fact is that any spoils system requires money flowing out of the coffers of the State, and that anyone who can direct this outflow to their people, will ensure the loyalty of those people.

It will be argued that Republicans engage in corporate welfare. In what might that consist? Lower tax rates? Less obstructive regulations?

What do these lead to? More jobs, and better jobs. Remember, no public sector job is sustainable without taking the same (or slightly more) amount of money from the pockets of private enterprise, who then cannot invest it or spend it.

There is nothing intrinsically wrong with the use of Unions to obtain better working conditions. But when the government MANDATES membership for some professions, and when it allows open labor trusts such as the UAW, then it no longer has anything to do with free markets, and everything to do with just one more aspect of the spoils system.

Every State should be “right to work”, no exceptions. This should be the law of the land, by Constitutional Amendment, if necessary.

And we need to get rid of these bullshit “minority participation” worksheets, which are not just used by the government, but by large corporations. This is de facto institutional racism, which I thought we had decided was a bad thing.

We take these words for granted. I have on my wall pictures of both John Hancock and Sam Houston. If you think about it–really think about it–the two are irreconcileable. John Hancock was defending a soon-to-blossom Yankee status quo. Some years later, Houston was defending what became a slave state against the aggressions of the Spanish colonists who had transformed themselves into the “Mexicans”.

Ponder South Carolina and Massachusetts in 1776. They were totally different. Yet, they bonded together. They melded. They formed one nation out of many. E pluribus unum.

We fail to appreciate this miracle simply because it happened. Had I sank the winning basket in some championship game, you would fete me because of the circumstances of fate. You would claim me to be special for some reason.

Likewise, we take for granted the surrender of sovereignty by some very serious people in pursuit of what has become a nation. We forget what they staked. We forget the seriousness of their claims.

They had every right to go their own way. They could have forgotten the North–conversely, the South–at any time. Yet, they staked their claim with their fellow colonialists. We should not forget this.

I see a lot of conservatives hyperventilating over the extension of the Bush tax cuts on the wealthy. To my mind, this is not a critically important issue. We had a good economy under Clinton, before he enacted the tax cuts.

I am an anti-Keynesian–since his policies were intended to foster socialism–and therefore what has come to be called a “supply sider”, which is to say “anti-demand sider”, which again is to say “anti-Keynesian” and by extension anti-socialist/fascist.

Common sense economics is embodied in the Laffer Curve, which stipulates that actual goverment revenues will in fact increase up to a certain point as tax rates are increased, then begin to decrease, both as economic investment becomes de-incentivized (the government takes the rewards of your risks, and you suffer any losses privately, a lose/lose situation), and as money is simply invested in more productive places.

It is far from clear, though, that we have reached the point of diminishing returns. Clearly, if we are to have a government, we must pay taxes.

The bigger, much, much, much more important question–which Republicans seem too cowardly to pose in a serious fashion–is the size of the government. The Bush tax cuts worked. Overall revenue increased. And yet with a Republican Congress and a Republican President, overall expenditures skyrocketed.

Did we really need a Dept. of Homeland Security, when the root problem was a series of fuckups by the agencies tasked with intelligence gathering? To the extent the problems were political correctness, do we fix them by giving more power to the same sorts of people, people like Janet Napolitano, whose agency ignored the pleadings of the underwear bombers own father, and whose response to that fuckup is to grope small children or take nude photos of them?

And to be clear, I personally do not think Bush had a hand in it, but 9/11 was clearly perpetrated by a larger group than those men who hijacked the planes. Most conspiracy theorists are not sufficiently light on their feet to see the places where their narrative splits from the necessary to the possible. It is in my view necessarily the case that bombs were set in at least Building 7, and by extension that they were likely set in Buildings 1 and 2. This leads necessarily to the conclusion that people were involved who have not been identified or–probably–caught. This is a serious shortcoming, which manifestly has not been fixed by our so-called Dept. of Homeland Security, which at the moment is refusing even to defend our borders. Nothing desirable was accomplished for this massive expenditure. We need to recognize this, and learn from it.

Perhaps we need to consider abolishing the DHS.

Certainly, and this is the point I intended to make, we need to fire everyone Obama just hired. We then need to continue firing. We need to abolish all Departments and agencies that are not a part of the core mandate of the Federal Government to protect our borders, and regulate relations–within reason–between the States.

We do not need Department of Energy. What do they do? Is it helping? Are we energy independent?

We do not need a Department of Education. Our system is failing, and they are doing nothing to help it.

What we need more urgently than anything is an end to public sector unions. All of them. Teachers unions, AFSME (or whatever it is), and the rest.

In Capitalism, a union is a counterbalance to the ability of business owners to collude to fix wages. The price of labor is set by free market forces, in negotiation between two entities that in theory both want the business to succeed. I say “in theory” since some union leadership–for example the UAW–really cares more about keeping their six figure salaries and power–which itself is an aphrodisiac and desirable for some in its own right–than in protecting ordinary workers. They are quite happy to see mass layoffs and permanent unemployment, if they can keep enough people on the gravy train to keep themselves on the gravy train.

Actually, I should expand on this point, before making the next one.

What Democrats enable, by their economic meddling, is the use of coercive government power to maintain labor monopolies in perpetuity. The UAW bankrupted GM and Chrysler. Their members get extremely generous pensions and healthcare benefits, which are simply unaffordable. Their benefit packages add several thousand dollars to every car which rolls off an American assembly line.

In a free market, these benefits would have been written down to maintain employment. Given a choice, many Union members would have preferred keeping their jobs at a lower wage and benefit package, than to play a lottery where if they win, they keep everything, and if they lose, their job is lost forever. Self evidently, many people have lost, and continue to lose, as jobs leave our shores, preventably and likely permanently. But the government allows unions to mandate membership. This is collusion and is both morally and economically wrong.

What has happened with Obama is that the government has provided the money to keep union pensions and healthcare packages solvent. This means that tax money has been diverted from legitimate public use, and used to fund a minority of American workers, who have gamed the system without creating compensating economic benefits. This is my understanding. It is my further understanding that under Obamacare these same union benefit packages will be immune from taxation, whereas everyone elses–the people producing actual wealth–will be subject to taxation.

Finally, I wanted to comment that public sector unions do not engage in market forces at all. It is one set of politicians negotiating with another. Union leaders negotiate with Democrats, in the main, for wage increases, which are funded with taxpayer money. It is thus a redistributive scheme which is utterly immune from market forces. This means that it is effectively a system of bullying and favor buying, rather than a legitimate activity.

Witness, for example, the teachers unions in New Jersey that wanted continuing pay increases far in excess of inflation, during a recession. This is unconscionable.

In my view, public sector employees need to take what they are given. If we don’t pay enough, we won’t attract good people. If we pay too much, the taxpayers need to revolt.

Right now, we need to revolt, since the average Federal employee makes a third more than his equally trained and able private sector counterpart.

This is the important issue. We need mass firings, the cessation of large Federal bureaus, the end of public sector unions, the normalization of Federal salaries to their private sector equivalents, and an overall decrease in the size of the Federal Government by perhaps one third.

In exchange for that, I would be extremely happy to let the Bush tax cuts–all of them–expire.

Will stupid people scream? Of course.

Is it certain we will continue as a democracy, or as a prosperous nation? No.

Do we deserve to? That is a really good question. Our response to our current fiscal crisis will provide the answer. If we choose to remain as children, and not adopt the ways of mature adults, then no, we do not deserve to remain free or prosperous.

All nations end. It is just a question of how long they endure. I like to think we are capable of exercising mature judgment, but the jury is still out, and there are many many feeble and yet vocal minds among us.