The Big Three

Let them fail. Their will be others picking up the pieces.

We never had Pure Capitalism

A recent Reuters article suggests that capitalism is to blame for the financial crisis. That capitalism is on its deathbed. However the current system in the United States is not pure capitalism.

Pure Capitalism is the voluntary and free exchange of goods and services, a free market so to speak. There is a misconception that, taken as a whole, the type of economic system we have in the United States is capitalism. However, sticking strictly to the definition, the United States, although leaning towards free exchanging of goods and services (and apparently drifting the other direction), does not have a completely free and voluntary market.

We never had Pure Capitalism. The type of economy we have is a mixed market, where business and government collude/collaborate, whether with good intention or ill, meddle in the voluntary and free exchange of individuals, creating a forced monopoly in an industry. A centralized entity has created a forced monopoly, in several industries, for example, education, health insurance, and banking (of which I will detail in further posts.) This is known as state capitalism.

Socialism takes the idea of the mixed economy further, rather than just regulating and/or restricting voluntary and free exchange in the market, it attempts to take matters one step further creating centralized control of the market, for example nationalizing (bailing out) banks. Socialism attempts to plan not only the means and ends of production, but also the means and ends of exchange, namely through control of money. It looks as though the United States is getting closer and closer to Socialism, unfortunately.

Nobel but not Noble

A recent letter from past Nobel Prize winners advocates Americans choose Barack Obama as the next president of the United States. Their rational is that the Bush Administration via the Federal Government diminished funds for scientific research. While I do not agree with the policies of the Bush Administration, it is unconstitutional for federal funds to be used in scientific research. Where in the constitution does it say that the federal government is supposed to fund research? Matters of funding research is left up to the States, Individuals, and Organizations, NOT the Federal Government.

The assumption is that these "smart" Nobel Prize winners, the intellectual elite so to speak, are also smart enough to know who to put in power as President of United States. However, just skimming their credentials shows the bias the Nobel Prize winners have, Physics, Chemistry, and Medicine. None from Literature, Peace, or even Economics. Of course these Nobel Prize winners want someone who will pay their salary.

Ideally, all research funds would be garnered via the free market, where businesses, organizations, and individuals will contribute to further research. The Noble thing to do would be to stop all Federally Funds towards Science, and let the market decide which research is worthy of further development.

Hey World Government Leaders, Here is the SECRET to fix the Economy:

DO NOTHING!!!

The Boom was the Financial Crisis

The actual financial crisis occurred during the so-called boom years. Artificially low interest rates set by the Federal Reserve stimulated borrowing from the central bank itself. This expansion of credit in turn creates an expansion of the money supply. More money created means more money for banks to lend, more money for banks to lend, means more money for individuals to borrow. More individuals with access to cheap money, means that home prices will go up, because sellers want to get the most profit. Although individuals and banks may have appeared prosperous, both were in the midst of a financial crisis.

The caveat is, that since borrowing was stimulated by artificially low interest rates, borrowed investment was malinvested. Capital resources were misallocated into areas which would not normally garner investment if the money supply was stable. Houses are expensive things to be, and got even more expensive with easy money available. Money was used to purchase overpriced houses. In a market driven economy house prices and interest rates would by the market itself, rather than a central bank inducing artificially low interest rates, hence distorting home prices. House price and interest rates would fluctuate regionally, and locally, according to what the market can handle.

Now, how do we end the financial crisis? End the Federal Reserves monopoly control over money and interest rates. Otherwise we are doomed to repeat it again, assuming we can get out of the current mess.

Newly Created Position - OFS: Office of Fascism and Socialism

Good bye free market, hello fascism and socialism.

The US Treasury created a new office today via the Bailout Legislation passed last Friday. This new office is the OFS, Office of Financial Stability, otherwise known as the Office of Fascism and Socialism.

The legislation attempts to meddle with the free market, in forcing stipulations on how companies run their businesses, and bailing out companies that are not profitable. Fascism is a political philosophy that exalts nation above the individual, standing for autocratic government with sever economic and social regimentation. Socialism is the governmental ownership and administration of the means of production and distribution of goods. The new office is fascism and socialism rolled into one. Companies are told how to run their business. Companies are given taxpayer money to remain in business, even when their business is failing. It is the epitome of government intervention.

In a free market, no government intervention would be necessary. Companies would have to be smart with their actions and their money, as to remain running and profitable without a bailout. Government bailouts and intervention in the marketplace encourage stupidity with money and actions. In the governments eyes, the failures were caused because of lack of regulation and oversight, hence calling for more more intervention, ie Office of Fascism and Socialism. In reality it is caused by more and more regulation and intervention, and is best solved by laxing the regulation and letting the market solve the problems government has created.

The Prearranged, Preplanned, and Premeditated Bailout

It is one thing to grant a bailout during a so called financial crisis, but its another thing to prearrange a bailout a year in advanced when markets are soaring. There are two bills that are the "bailout" bills, HR 3997 and HR 1424.

HR 3997 is known as the "Emergency Economic Stabilization Act", however, its original title is "An Act to amend the Internal Revenue Code of 1986 to provide tax relief and protection for military personnel, and for other purposes." HR 3997 was introduced on 10/30/2007, that is right, 2007, that is no typo. Perhaps congress just amended HR 3997 to use as a vehicle for Emergency Economic Stabilization? Let's give them the benefit of the doubt on this one.

Now, let's take a look at HR 1424, which recently passed the Senate. HR 1424 is titled, "A bill to provide authority for the Federal Government to purchase and insure certain types of troubled assets for the purposes of providing stability to and preventing disruption in the economy and financial system and protecting taxpayers, to amend the Internal Revenue Code of 1986 to provide incentives for energy production and conservation, to extend certain expiring provisions, to provide individual income tax relief, and for other purposes." (emphasis added) That was a mouthful.

The title is concurrent with the bailout theme, however, the timeframe of HR 1424 introduction to congress is NOT current at all. HR 1424 was introduced in 3/9/2007. That is right, 2007, NOT 2008. Nearly a year and half ago! Nearly a year and half before the so called financial crisis. The Dow was at 12,114 and rising. It peaked on 10/12/2007 at 14,093.

This so called bailout has been in the works for a year and half. HR 1424 is not only a vehicle for "Emergency Economic Stabilization", it was prearranged, preplanned, and premeditated even before a financial crisis came to fruition.

Sources:
HR 3997 All Congressional Action:
http://thomas.loc.gov/cgi-bin/bdquery/z?d110:HR03997:@@@X

HR 1424 All Congressional Action:
http://thomas.loc.gov/cgi-bin/bdquery/z?d110:HR01424:@@@X

Banning Gay Marriage and Protecting Gay Marriage, at the Same Time

There was a piece in the Los Angeles Times of a liberal Democrat supporting prop 8, the ban on gay marriages, to protect kids.

"Marriage (and only marriage) unites the three core dimensions of parenthood -- biological, social and legal -- into one pro-child form: the married couple."

Liberals want laws legalizing gay marriage(equal rights for all couples, gay or straight), conservatives want laws banning gay marriage (to protect straight marriages and for the children upbringing). However as a libertarian, I don't think the proper place for marriage is run by the State Government. The state is too far removed for the day to day lives of individuals and local organizations. Politicians and government hundreds if not thousands of miles away are making choices for us, where individuals and local organizations need to make their own choices. The proper place for the decision to grant or acknowledge a marriage is through the churches, fellowship organizations, and individuals.

"Marriage says to a child: The man and the woman whose sexual union made you will also be there to love and raise you. Marriage says to society as a whole: For every childborn, there is a recognized mother and a father, accountable to the child and to each other."

I know for myself, I want my child to have a Mom and Dad, and family to learn and grow together. However, I do not think the State Legal system is the appropriate way to garner these results for myself, and for others if they do choose. Just because a law is placed in the State Legal framework, does not mean it will be followed. For example, the divorce rate of hetero couples is 50%, and perhaps even 66% in Southern California. Those broken families include children. The idea that a state marriage will hold the bond for a child does not hold. The idea of accountability of a mom and dad to a child does not hold via a state marriage. When the power to grant marriages is given back to the local organization, there is a better chance, imho, that these ideas of accountability will hold. The local organization is their to help continue the bond and council in times of strife, and celebrate in times of success. For example, when was the last time the State of TX sent you a bday wish?;) But I would be local fellowship wished you a wonderful celebration.

In essence, there would be a ban and a protection of gay marriage ALL AT THE SAME TIME. Individual organizations would be able to ban gay marriage or include gay marriage. There would be some organizations that would grant gay marriages, and some that would not, and the state would have no say, just the local organization. For example, a Christian Marriage by the Church would most likely be only hetero, but another type of marriage by another local organization could be gay. However, the State would NOT be able to force a Church to grant/recongnize a homo marriage. That would be wrong.

Is America really in a Financial Crisis?

A cultural meme has been permeating America, that America is in the midst of a financial crisis, also known as an economic crisis. But I posit the question, is America really in a financial crisis?

Assume that America appears in the midst of a financial crisis, wouldn't America need to bailout out America as opposed to just bailing out Wall Street? Wouldn't America need to be bailing out individuals rather than corporations? Judging from where the bailout going to be appropriated, it appears that only Wall Street with several selected financial firms are in the financial crisis, not America as a whole.

America is NOT in a financial crisis.

Buyout Not Bailout

The continuing bailout of Wall Street would mean the loss of something far greater than money, jobs, and corporations, it is the loss of what America prides and defines itself, the loss capitalism.[1]

America prides itself in being a capitalistic nation. Capitalism, according to the New Oxford American Dictionary, is an economic and political system in which a country's trade and industry are controlled by PRIVATE owners for profit, rather than by the STATE.

As a corollary to this, while PRIVATE owners strive for profit, they also hold the risk for loss, and must take on the consequences of that risk. Risk is the name of the game. Risk may mean success or failure. With that risk, the reward of profit, or the failure of loss. Wall Street is trying to change the rules of the game where risk ALWAYS equates to success. Wall Street took the risk, they must take on the consequences of that risk, and right now, that consequence is failure and loss.

Rather than having bureaucrats and corporations set the value of the companies, why not let the market decide their value? Why not allow for the market to BUYOUT Wall Street, rather than America having to BAILOUT Wall Street? That would allow for the market to set its price, rather than arbitrarily being set by Paulson and his cohorts. It would allow the "financial crisis" to cure itself, rather than the STATE trying to fix the symptom. Having the STATE BAILOUT Wall Street kills the the core of capitalism, it is no longer a PRIVATE loss, it becomes a STATE loss. Hence it becomes the taxpayers loss.

A buyout, although risky, would be a fair greater gain for capitalism in the long run.

[1] Granted, America, nor any other nation in the world holds completely to free market capitalism, although until recently, America leaned far more free market. But its true colors are showing, private profits and socialized losses, which is NOT free market capitalism.

Cracking Down on Market Manipulation

"We need to crack down on trading activity that crosses the line to market manipulation. We need regulators that actually enforce the rules instead of overlooking them. The SEC should investigate and punish all market manipulation." - Barack Obama

Alright Barack, let me just assume that your statement is a plausible one. Cracking down and punishing market manipulation would start, not at regulating the market, but setting the market free; it would mean not interfering with the market, but letting the market do it's work.

Market manipulation includes, subsidizing and managing schools, healthcare, and retirement. Market manipulations is the Federal Reserve adjusting interest rates up or down. Market manipulations is mandating price stabilization. If you really want to stop market manipulation, nip it at its source: abolishing central control of money and interest rates, and dismantling government programs. Let the market do it's work, set the market free.

Regulating Deregulation

Regulating deregulation does not deregulate regulation.

Pro Free Market, Anti Free Market, or Selective

“I believe that America's free market has been the engine of America's great progress. It's created a prosperity that is the envy of the world. It's led to a standard of living unmatched in history. And it has provided great rewards to the innovators and risk-takers who have made America a beacon for science, and technology, and discovery…We are all in this together. From CEOs to shareholders, from financiers to factory workers, we all have a stake in each other's success because the more Americans prosper, the more America prospers.”
- Barack Obama, New York, NY, September 17, 2007

"Out of work, tough luck, you're on your own. No health care, the market will fix it, you're on your own."
- Barack Obama, Speech, DNC 2008

Obama's Economic Ad: Rebuttal

This is a rebuttal to Barack Obama's economic ad (text).

In the past century, since 1913, America has been rocked as the money and banking became centralized and markets became more and more regulated. But for many of you - the people I've met in person, or on the internet, our troubled economy isn't news. Every American has lost their economic freedom since 1913. Money is created out of thin air, thus devaluing our dollar. It's hard to save money if you need to put everything on credit. You're paying middlemen insurance companies, that cover less and less, rather than exchanging directly with your doctor.

This is a string of market intervention leading to more market intervention. The truth is that while personal responsibility and volition has been stripped, Washington stopped living up to its responsibility of limited government. That's why we need change. Genuine change. This is no ordinary time yet it is another ordinary election. But much of this campaign has been consumed by statist rhetoric and distractions that have nothing to do with you or how we get America back on track.

Here's what we need to do. Reform our tax system, by lowering the income tax, from 10-35% of your income to ZERO percent. Stop ALL government subsidies to ALL corporations, not only to oil companies and companies that outsource our jobs. End the 'bailout' culture on Wall Street, where not just reward, but risk and repercussions are all part of the market. No company is too big to fail. Fast track ENDING government mandated monopolies on energy creation and transmission, let the millions of individual Americans choose their energy sources. Crack down on statists - once and for all - so their back-room deal-making no longer drowns out the effectiveness of the free market and undermines our interests as individual Americans.

And yes, bring an end to pre-emptive war and interventionist policies, so we can stop spending billions each month on OTHER countries when we should be focusing on our own. Doing these things won't be easy. But we're American individuals. Individuals before us met tough challenges before. Will you meet the challenge? I'm Vienna Sausage. I have no central economic plan, but a plan for a true free market, including free entry, free exchange, and free exit. I approve this message because emotionally laden statist ideas of the left and the right will only prolong the problems we face today. But a renewed spirit of unity yet individual responsibility will.

Obama's Economic Ad: Line by Line Critique

This is a line by line response to Barack Obama's economic ad (text).

Barack Obama: In the past few weeks, Wall Street’s been rocked as banks closed and markets tumbled.
Vienna Sausage: In the past century, since 1913, America has been rocked as the money and banking became centralized and markets became more and more regulated.

BO: But for many of you – the people I’ve met in town halls, backyards and diners across America – our troubled economy isn’t news.
VS: But for many of you - the people I've met in person, or on the internet, our troubled economy isn't news.

BO: 600,000 Americans have lost their jobs since January.
VS: Every American has lost their economic freedom since 1913.

BO: Paychecks are flat and home values are falling.
VS: Money is created out of thin air, thus devaluing our dollar.

BO: It’s hard to pay for gas and groceries and if you put it on a credit card they’ve probably raised your rates.
VS: It's hard to save money if you need to put everything on credit.

BO: You’re paying more than ever for health insurance that covers less and less.
VS: You're paying middlemen insurance companies, that cover less and less, rather than exchanging directly with your doctor.

BO: This isn’t just a string of bad luck.
VS: This is a string of market intervention leading to more market intervention.

BO: The truth is that while you’ve been living up to your responsibilities Washington has not.
VS: The truth is that while personal responsibility and volition has been stripped, Washington stopped living up to its responsibility of limited government.

BO: That’s why we need change. Real change.
VS: That's why we need change. Genuine change.

BO: This is no ordinary time and it shouldn’t be an ordinary election.
VS: This is no ordinary time yet it is another ordinary election.

BO: But much of this campaign has been consumed by petty attacks and distractions that have nothing to do with you or how we get America back on track.
VS: But much of this campaign has been consumed by statist rhetoric and distractions that have nothing to do with you or how we get America back on track.

BO: Here’s what I believe we need to do.
VS: Here's what we need to do.

BO: Reform our tax system to give a $1,000 tax break to the middle class instead of showering more on oil companies and corporations that outsource our jobs.
VS: Reform our tax system, by lowering the income tax, from 10-35% of your income to ZERO percent. Stop ALL government subsidies to ALL corporations, not only to oil companies and companies that outsource our jobs.

BO: End the ‘anything goes’ culture on Wall Street with real regulation that protects your investments and pensions.
VS: End the 'bailout' culture on Wall Street, where not just reward, but risk and repercussions are all part of the market.  No company is too big to fail.

BO: Fast track a plan for energy ‘made-in-America’ that will free us from our dependence on mid-east oil in 10 years and put millions of Americans to work.
VS: Fast track ENDING government mandated monopolies on energy creation and transmission, let the millions of individual Americans choose their energy sources.

BO: Crack down on lobbyists – once and for all — so their back-room deal-making no longer drowns out the voices of the middle class and undermines our common interests as Americans.
VS: Crack down on statists - once and for all - so their back-room deal-making no longer drowns out the effectiveness of the free market and undermines our interests as individual Americans.

BO: And yes, bring a responsible end to this war in Iraq so we stop spending billions each month rebuilding their country when we should be rebuilding ours.
VS: And yes, bring an end to pre-emptive war and interventionist policies, so we can stop spending billions each month on OTHER countries when we should be focusing on our own.

BO: Doing these things won’t be easy.
VS: Doing these things won't be easy.

BO: But we’re Americans.
VS: But we're American individuals.

BO: We’ve met tough challenges before. And we can again.
VS: Individuals before us met tough challenges before.  Will you meet the challenge?

BO: I’m Barack Obama. I hope you’ll read my economic plan.
VS: I'm Vienna Sausage. I have no central economic plan, but a plan for a true free market, including free entry, free exchange, and free exit.

BO: I approved this message because bitter, partisan fights and outworn ideas of the left and the right won’t solve the problems we face today.
VS: I approve this message because emotionally laden statist ideas of the left and the right will only prolong the problems we face today.

BO: But a new spirit of unity and shared responsibility will.
VS: But a renewed spirit of unity yet individual responsibility will.

The Forth of July

The 4th of July has come around again.  Greetings of "Happy 4th", "Have a great 4th of July", etc..., permeate my ears.  This got me thinking, we generally refer to this holiday as the Forth of July as opposed to Independence Day.  We refer to this particular holiday by its calendar date, as opposed to the actual celebration behind the holiday.  Is this exclusive to the "The Forth" or does this phenomena spread to other holidays, commemorations, and/or anniversaries.  Enclosed below is a list, where the usual name is bolded.  Apparently, the name of the event rather than the date it occurs is used.  "The 4th" and "9/11" appear to be anomalies.  But why?  Imagine if we started calling Christmas, "December 25th", or Valentines, "February 14th"?  

Does the nomenclature of the event, rather by calendar date or name, deprecate or intensify the meaning behind the event?  Do we even know why we are celebrating/commemorating an event?  Or are most of the holidays just an extra day off?

Date	Official Name	Remarks
January 1	New Year's Day	Celebrates beginning of the Gregorian calendar year. Festivities include countdowns to midnight (00:00).
Third Monday in January	Birthday of Martin Luther King, Jr.	Honors Martin Luther King, Jr., Civil Rights leader; combined with other holidays in several states (King's birthday was January 15)
January 20, every fourth year, following Presidential election	Inauguration Day	Swearing-in of President of the United States and other elected federal officials. Observed only by federal government employees in Washington, D.C., and certain counties and cities of Maryland and Virginia, in order to relieve congestion that occurs with this major event. Note: Takes place on January 21 if the 20th is a Sunday (although the President is still privately inaugurated on the 20th).
February 14*	Valentine's Day	The traditional day on which lovers express their love for each other by sending Valentine's cards, presenting flowers, or offering confectionery.
Third Monday in February	Washington's Birthday	Honors George Washington. Often popularly observed as "Presidents Day" in recognition of other American presidents, such as Abraham Lincoln (who was born February 12). The legal name of the federal holiday, however, is "Washington's Birthday".(historically observed on February 22, prior to passage of the Uniform Monday Holiday Act by Congress)
Last Monday in May	Memorial Day	Also known as "Decoration Day", Memorial Day originated in the nineteenth century as a day to remember the soldiers who gave their lives in the American Civil War by decorating their graves with flowers. Later, the practice of decorating graves came to include members of ones own family, whether they saw military service or not. Memorial Day is traditionally the beginning of the summer recreational season in America. (historically observed on May 30, prior to the Uniform Monday Holiday Act)
July 4, The Forth	Independence Day	Celebrates the signing of the Declaration of Independence. More commonly known as "the Fourth of July".
First Monday in September	Labor Day	Celebrates achievements of workers and the labor movement. Labor Day traditionally marks the end of the summer recreational season in America. The following day often marks the beginning of autumn classes in primary and secondary schools.
Second Monday in October	Columbus Day	Celebrated since 1792 in New York City, honors Christopher Columbus, who landed in the Americas on October 12, 1492. In some areas it is also a celebration of Italian-American culture and heritage. Congress and President Franklin Delano Roosevelt set aside Columbus Day in 1934 as a Federal holiday at the behest of the Knights of Columbus (historically observed on October 12, prior to the Uniform Monday Holiday Act)
October 31	Halloween	Halloween activities include trick-or-treating, ghost tours, bonfires, costume parties, visiting "haunted houses", and carving jack-o-lanterns.
September 11, 9/11*	World Trade Center Bombing	Bombing of the World Trade Center
November 11	Veterans Day	Also known as Armistice Day, and very occasionally called "Remembrance Day", 'Veterans Day' is the American name for the international holiday which commemorates the signing of the Armistice ending World War I. In the United States, the holiday honors all veterans of the United States Armed Forces, whether or not they have served in a conflict; but it especially honors the surviving veterans of World War I, World War II, the Korean War, and the Vietnam War. The American holiday was briefly moved to the final Monday in October under the Uniform Monday Holiday Act, but the change was greatly disliked and soundly criticized - among other reasons, because it put Veterans Day out of sync with international observance; so it was restored to November 11.
Fourth Thursday in November	Thanksgiving Day	Traditionally celebrates giving thanks for the autumn harvest, and customarily includes the consumption of aturkey dinner. (historically observed on various days, but finally becoming so fixed to the fourth Thursday in November in the hearts and minds of Americans, that Americans rebelled (albeit politely) when President Franklin Delano Roosevelt attempted to move it to the third Thursday of November, at the request of numerous powerful American merchants)
December 25	Christmas Day	A holiday that celebrates the birth of Jesus Christ, observed on 25 December. Aspects of the holiday include decorations, emphasis on family togetherness, kindness and goodwill toward all people. Designated a federal holiday by Congress and President U.S. Grant in 1870.

table source: http://en.wikipedia.org/wiki/Federal_holidays

*inserted for refernce, not a federal holiday