Hank
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Poster: Hank @ Wed Oct 22, 2008 10:27 am
There's a scene early in last year's blockbuster flick "No Country for Old Men" when Josh Brolin comes home after plundering the bloody scene of a botched drug deal with a gleaming .45 tucked into his waistband. His wife, with whom he lives in a crummy apartment, asks where he'd obtained the thing. Brolin curtly responds, "At the gettin' place."
Now, anybody who saw that movie will know that in fact, the enviable chrome had not come from 'the gettin' place,' but had been stolen from a corpse shortly after Brolin had left another homie to die by thirst, wounds, and 'el lobo.'
When foreign banks open their email to find a fresh infusion of US Dollars, US depositors find that their account insurance has more than doubled, holders of bad debts are relieved of those 'troubled assets,' and US taxpayers open up their mail next year to find a meager 'stimulus check,' these beneficiaries might ask their benefactor where all this money came from. After all, much like Brolin's character in the movie, the US government has fallen on tough times and is very, very hard up for cash. In fact, like Brolin, it has little but war memories, a moustache, and a gun. So where are the dollars in the firehose coming from?
To hear Bernanke and Paulson, the architects of the current situation, tell it, this vast pile of dollars -- trillions of them now -- came from the gettin' place.
In fact, Bernanke and Paulson's gettin' place isn't much different from Brolin's. Nor does their motivation or depth of thought differ a whole lot from that character's. As the desperate cowboy steals the Colt and suitcase from a dead man, Bernanke and Paulson steal these dollars from the corpse of American liberty. At the scene, the injured taxpayers warn about the coming wolves of statism and rampant inflation; they're coldly told that 'there ain't no lobo.' After all, Bernanke and Paulson know better than anyone about these things.
It has been revealed this week that the incredible, unprecedented, criminal Wall Street bailout was merely the first step in a treacherous and macabre dance of doom. When that move failed to 'unfreeze' the credit markets and Wall Street wasn't impressed, Bernanke promised 'unlimited' -- unlimited -- dollars to foreign banks to help their 'liquidity problems.' Soon after, we started to hear the fiendish candidates for President start talking about direct debt relief for individual homeowners, using public dollars. And then, when all these feints and ruses did not have the desired effect, yet another 'stimulus package' -- more dollars -- was fielded in a hopeless attempt to stanch our 'financial system's' very mortal wound.
Public liability for private debt is an abomination, and would be so under under any conditions. Our present conditions of record public debt, to the tune of ten trillion dollars, make the actions of Paulson and Bernanke monstrous to the maximum. When someone is deep in debt, with a seriously negative net worth, we call that person a fool and irresponsible. When that 'someone' is the government, and their debt spending in fact puts the public in the hole while squandering tax dollars, we call that criminal and treasonous as well as foolhardy.
The people at large, and these crazy actors of policy in particular, need to get a handle on a simple, incontrovertible fact : the government has no money. The government has no money! The government is in debt, and any money that it plans to spend it will confiscate from you; any debt obligations it incurs will be collected from you, and your successors.
Even the most fatalistic, 'FTW' types must confront the immediate and dire consequence of the evils perpetrated by Paulson, Bernanke and their accomplices. That is : rampant, uncontrolled inflation. No matter what you may hear from apologists, no matter what gibberish is vented by pseudo-economists, no matter what your so-called 'conservative' friends may say, the result of these terrible decisions shall be a profoundly accelerated inflation and debasement of the dollar.
The reason that this is true is because of a basic, simple, factual truth about economic activity : when the supply of a commodity increases, its price decreases. Money is a commodity that is used to purchase other commodities. Its price is called its purchasing power. When the price of money is high, that means that you can buy a relatively large amount of other items with it. When its price is low, you can buy less. When the price of money falls, it is called 'inflation,' a misleading term that really means that the average prices of other goods appear to be rising -- inflating -- relative to the price of money. In other words, inflation is really a way to describe the falling price of money relative to other goods, and it is caused by one thing and one thing only : increases in the money supply.
When Bernanke, Paulson, and their buddies 'spend' billions of dollars they don't have, and give 'unlimited' new dollars to foreign and domestic banks, and guarantee innumerable private debts, they are, in short, printing money. They are adding vast, nigh-incalculable amounts to the money supply. This is the fact of the matter, and it is starkly true.
There is only one possible result of creating a supply glut : falling prices. When the price of the dollar falls, we call it inflation. To quote John Pugsley in "The Alpha Strategy :"
"An increase in the money supply is the only cause of inflation in the long run. Money is created by fractional-reserve banking, and by the Federal Reserve as it monetizes federal defecits. The future rate of inflation is primarily a function of the size of deficits, since the Federal Reserve is duty-bound to monetize them."
In summary : the cause of inflation is debt spending and the attendant increase in the money supply. There is no other cause. And when the government mounts debt and prints money at unprecedented rates, we should expect nothing else but unprecedented inflation.
This is, as Pugsley would say, the plunder of America. It is also a trespass on our freedom and an assault on our future, as it is our hard-earned dollars along with the security of our future with which these people are toying. Whether they are short-sighted and stupid, or plotting and evil, the result is the same : there certainly is a doggone lobo, and it will be at the door much sooner than they expect.
So what do we do about it? It has been widely suggested that the institutional wheels of theft have been turning for far too long, and the people 'in power' so firmly entrenched or hidden, that we have no choice but to suffer and endure as our future and rights erode and our currency becomes less valuable than kindling. I say that this is a ridiculous and wimpy attitude. There is really only one way to save our freedoms and country from oblivion.
Like the woman-haired killer in "No Country," we know where the politicans are. But that's not where we're going. The politicians are both desperate and foolhardy; we few cannot make them change directly because they fear the public. We must 'get to' those that ultimately control the politicians. We must approach the public directly, for it is the cry of the public for wealth redistribution via taxes that is the engine of government in the long run. The reason we are being sold down the river is because voters and taxpayers are demanding to be sold down the river to protect their short-term interests. Every time that an industry leader requests a subsidy, every time a private individual wants an entitlement, every time a banker wants a loan guarantee from the public, the crisis gets worse. These are the folks that need to be approached, so that they can stop demanding public money from the politicians and start protecting their real interests. But unlike the strange assassin, we visit not with a weapon, but with knowledge and hope.
What a daunting task! How are we to go about educating the public on the serious need to put short-term interests on hold in favor of the preservation of the value of their money, the integrity of their freedom, and the viability of their future? Start by talking to people you know, your friends and family, and point out the basic facts about inflation and debt first, then address the wrongness of public liability for private risk. Let them know that there is no time for complacency, depressive fatalism, or myopia. Things are in motion right now, and only direct action by taxpayers can accomplish what is needed. The public must be made to see that, whatever temporary benefit they may individually receive from public funds, that benefit pales when compared to the grave erosive dangers of inflation, which causes everybody to lose buying power, and debt, which sells our childrens' future.
If you ask people if they generally favor higher or lower taxes, they will usually say 'lower.' Ask them why that is, and they will say it is because they want to keep more of the money they earn. When it is explained to them that they would be able to keep more of that money if they didn't have to pay for some of the 'benefits' they receive from public funding, along with the institutions that administer those 'benefits,' they are forced to confront the true issue. When the inflationary nature of debt spending is included in the conversation, it becomes evident that a preference for these 'benefits' at the expense of a stable currency and a viable future is irresponsible. Fold into this theo the idea of freedom and the integrity of personal property, and the situation becomes even more clear to the person considering the long-term meaning of our choice.
The reason that the people have stood for the theft so far is that we have become so used to having our property violated, supposedly for 'the public good,' that we no longer thing twice about it. We place much faith in the ability of actors like Paulson and Bernanke to know more than we can about our situation, and to make the right decisions for us, because we can't decide for ourselves. This is error. We can see plainly that, despite the wizard-like image that these people project, the facts and correct course are plain. Increased money supply and public debt causes inflation. Massive doses of either are bound to cause inflation that is massive. We don't need ex-industry CEOs turned public administrators to navigate our interests when we can see them so clearly.
As we become aware of our reality and the true nature of the 'crisis,' it's is not less than our duty to tell our fellow citizens about it. Start right now, and don't be discouraged nor intimidated by those who tell you it is either a lost cause or that they know better than you. Our nation was founded by people who would not stand to be plundered and would not be silent. When we stand up for reason, for frugality, and for liberty, when we publicly and privately promote these values, we stand up for the whole of America. We stand up and tell our neighbors that we the people are not, and will not permit ourselves to be, the government's gettin' place.
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