A Moral Foundation for an Economy?

Official congressional portrait of former Congressman and Governor of Illinois, Rod Blagojevich–a “poster boy” for government corruption.  Would you buy a used state government from this man? (Photo credit: Wikipedia)

The Chicago Sun-Times recently reported (“SEC hits Illinois with securities fraud charges, says Blagojevich budget office ‘misled investors’ on pension risks”) that,

 

“Illinois broke federal securities laws and “misled investors” in misstating [that means “lying about”—and that means fraud—a criminal offense] the true health of the state’s depleted pension funds between 2005 and early 2009, the Securities and Exchange Commission announced Monday.

“The finding of securities fraud doesn’t subject Illinois to any fines or penalties, but it amounts to another fiscal black eye for a state burdened by the worst bond rating in the country and completely underwater by inaction in solving its $96 billion pension crisis.”

 

Ooo—a “fiscal black eye”.  Boy, I’ll bet Illinois is sorry now, huh?  I’ll bet they cross their hearts and hope to die if they ever, ever do it again, hmm?

On the other hand, the fact that (other than Blagojevich) Illinois won’t suffer any criminal penalties or even criminal charges, might encourage the gov-co gangsters to do it again.

 

Private Property and the Second Amendment

$205 Million drug money seized by the Mexican Police and the Drug Enforcement Administration in Mexico city — largest single drug cash seizure in history (2007) (Photo credit: Wikipedia)

If you Google “Mexican Drug Violence,” you’ll find over 4 million hits.  The headlines on the first page tell a grim story:

 

•  Mexico’s drug violence epidemic moving closer to capital . . . dallasnews.com – The spread raises fresh concerns that Mexico’s new administration is unable to combat the drug cartels.

•  Mexico drug wars; graphic pictures . . . . http://www.telegraph.co.uk  . . . . Mexican authorities have turned to bizarre rituals including voodoo as they attempt to win the …

•  At least 26 dead in latest round of Mexican drug violence. http://www.rawstory.com  – At least 26 people were killed in Mexico in the past 24 hours in apparent drug-related crimes . . . .

•  LA Times (“Mexico Scrambles as Violence Threatens Tourism Zones”) the violence that has claimed an estimated 70,000 lives since December 2006.

 

Lions ‘n tigers ‘n macroeconomic consequences—Oh my!

We’ll need more than Ruby Red Slippers to get out of our current economic mess. (Photo credit: Wikipedia)

The Washington Times reports in “White House ups rhetoric on dangers of sequester,” that:

 

“The Obama administration amped up its offensive Sunday with Republicans over the $85 billion in across-the-board federal spending cuts scheduled to kick in Friday, releasing fresh warnings of a ‘real impact on people’s lives’ . . . .”

The federal government is projected to spend about $3.54 trillion in 2013.  The “sequester” laws scheduled to kick in this coming Friday will reduce that spending by $85 billion or about 2.4% of the entire budget.   Apparently, if government spending is cut by 2.4%, the sky will fall.

 

Adam Smith: The Origin and Use of Money

Profile of Adam Smith (Photo credit: Wikipedia)

Adam Smith (1723 – 1790) was a Scottish moral philosopher and a pioneer of political economics who’s best known for writing An Inquiry into the Nature and Causes of the Wealth of Nations (A.D. 1776). This book (usually abbreviated as “The Wealth of Nations”) is considered the first modern work of economics. Smith is cited as the father of modern economics and is still among the most influential thinkers in the field of economics today.

Chapter IV of Book I of The Wealth of Nations is entitled “Of the Origin and Use of Money”.  In that chapter, Smith explains that,

 

“[I]t is but a very small part of a man’s wants which the produce of his own labour can supply. He supplies the far greater part of them by exchanging that surplus part of the produce of his own labour, which is over and above his own consumption, for such parts of the produce of other men’s labour as he has occasion for.  Every man thus lives by exchanging, or becomes in some measure a merchant, and the society itself grows to be what is properly a commercial society.”

However, there’s a problem with this system of barter. Suppose one man has more of a certain commodity than he can use, and another man has less.  The former would be glad to dispose of his excess; the later would be glad to buy it.  But if the latter has nothing to trade that the former needs, no exchange can be made between them.

 

Hipshots

Newsboy. Little Fattie. 6 years old. Been at it one year. May 9th, 1910. Location: St. Louis, Missouri. (Photo credit: Wikipedia)

Three current events plus a few of my offhand remarks (“hipshots”).  Nothing profound, but possibly interesting.

•  West Point Cadets Taught Patriots Are Terrorists   According to Minute Man News, a new 148-page report is urging West Point students to consider many private Americans who claim to be “patriots”– and who are thus critical of government–to actually be American “terrorists”:

“This study, released by the United States Military Academy’s Combating Terrorism Center, is entitled “Challengers from the Sidelines: Understanding America’s Violent Far-Right.” Its author, Professor Arie Perliger, the Director of Terrorism Studies at the Combating Terrorism Center and Assistant Professor at the Department of Social Sciences at West Point, holds membership in the Council on Foreign Relations and the American Israel Public Affairs Committee . . . .  Perliger warns that growing legions of conservative-minded citizens across the U.S. pose a serious threat to our nation’s safety.”

In fact, a recent survey by the Pew Foundation indicates that the percentage of Americans who distrust government has risen to 75%.  Apparently Mr. Perliger is telling West Point students to ignore the public’s growing displeasure with the federal government and treat all such “dissidents” as “terrorists”.  Contrary to Mr. Perligner’s assertions, these dissidents do not pose a threat to “our nation’s safety”–they pose a threat to our nation’s government.  The government likes to argue that it’s best interests and the interests of our nation are one-in-the-same, but that’s not true.  In fact, the nation’s best interests and the government’s best interest are frequently, usually, and even primarily antithetical.  Thus, It’s entirely reasonable and generally inevitable that you be inclined to support your nation but resist your government.

 

Corruption Cuts Confidence

THE POSTER BOY FOR GOVERNMENTAL CORRUPTION: Jon Corzine, Governor and former Senator from New Jersey.(Photo credit: Wikipedia)

Anyone who studies economics understands that the strength and stability of an entire economy rests primarily on public confidence.

Franklin Delano Roosevelt said, “We have nothing to fear, but fear itself.”  In other words, we might have the world’s greatest natural resources, its most industrious people, and the most modern technologies.  But, if the public loses “confidence” in the economy or the political system, and becomes fearful, the economy can crash into a depression.

The reason is simple.  When people are confident that their futures are bright, they’re optimistic and spend freely; they invest and take risks and the economy runs hot and fast.

But when the people lose confidence in their futures, they become pessimistic and fearful, and they tend to save rather than spend or invest.  If the public won’t spend, the economy slows, unemployment rises and depression beckons.

“Confidence” is to the economy what “morale” is to the military.  So long as people are confident, they can overcome almost any obstacle.  When they lose their confidence, they can be stopped by any small bump in the road.

Therefore, it’s critical that government maintain public confidence—even if that confidence is based on lies.  We see evidence of government’s willingness to lie in economic indicators (unemployment rate, size of the national debt, price of gold, etc.) that are manipulated and “massaged” in order to create a false confidence in the economy.

 

Des citoyens Américains expliquent pourquoi le monde déteste les Etats-Unis

Jules Naudet filmed the impact of Flight 11 as it crashed into the North Tower of the World Trade Center. (Photo credit: Wikipedia)

None of the following video is fun.  All of it–even the parts that may seem offensive–even the parts that seem exaggerated–are based on fundamental truths.

video

00:10:08

http://www.youtube.com/watch?v=9GpBLO53f_k

 

Irish Journalist vs EU Spokesman

Image via Wikipedia

Here’s a video of an Irish journalist insisting that a spokesman for the EU explain why the Irish people are being held liable for paying billions of euros owed by a foreign (non-Irish) bank.

Note that this foreign bank’s debts were not “guaranteed”.   Presumably, this means the European creditors who lent their money to the foreign bank didn’t bother to ensure that repayment of their loan was secured with bonds, property or other forms of security.  I.e., if the bank defaulted on its debt, the creditors would still be able to attach the underlying bonds, property, etc. to recover their loans.

 

Vets Waking Up to Gov-Co Lies

Image by The National Guard via Flickr

This guy’s analysis is right on.

video

00:10:18

http://www.youtube.com/watch?v=gmIzJ0eGSYs&feature=share

 

Ex-CIA Agent Warns of Tyranny, Praises Bloggers

Image via Wikipedia

Remarkable video.  This ex-CIA agent is saying pretty much the same thing the “patriot” community has been saying for 20 years.

The difference is that “patriots” have had little credibility, while people with this speaker’s credentials have credibility.  The ideas behind freedom and liberty start at the bottom of society among the “great unwashed” and malcontents and slowly percolate upward to finally be accepted by folks who make a lot of money, join country clubs and hold positions of power.  I see this video as evidence of the “trickle up” theory that applies to great ideas.

(Note the bottom banner on the CIA “seal” [right].  The CIA is part of “UNITED STATES OF AMERICA”–not the confederation and perpetual Union expressly established and styled “The United States of America” by our Articles of Confederation in A.D. 1781.)

video  00:10:58

http://www.youtube.com/watch?v=mFUMlIm1Y94