The Crisis in 10 Points

The financial crisis of 2007–2008 was a Ponzi scheme writ large. A Ponzi scheme, or chain letter, initially succeeds but eventually collapses, just as imprudent loans may at first succeed in their objectives but eventually the laws of economics come into play and expose the futility of the whole exercise. A pyramid scheme is always unsustainable for the simple reason that it is based on faulty principles and built on flawed foundations. Until too late, no one in authority (regulators, risk managers, senior bank executives, credit-rating agencies, investment analysts) asked the key question, namely, how on earth was it possible in the long term to make profits by lending money to people whose chances of paying it back were practically nil? The issue was simply swept under the carpet because loans to deadbeats provided a better short-term return than did lower-risk debt instruments.

A chronicle of events leading to the current economic situation - fingers are pointed and names are named.

The Year Ahead: 2009

[S]ince 1913, our federal government has grown like a cancer to a size previously unthinkable. So perhaps it is no surprise that the whole enterprise is now collapsing, with government power increasingly drowning individual freedom in a tidal wave of police-state and coercive-socialist tyranny. The America of Henry David Thoreau, of Mark Twain, of Walt Whitman, of Thomas Jefferson and Tom Paine and the millions more who brought this nation into being and kept it alive in their hearts and, to a large extent, on the ground, for so long – that America, the real America, the "asylum for mankind" that Paine wrote about so eloquently – that America is gone, fading already into myth and legend, gone soon even from living memory as the last citizens who remember America's dying embers wink out from this world, one by one.

Glen Allport presents a dire assessment of the coming year(s).

The Art of the Impossible

Whoever called politics "the art of the possible" must have had a strange idea of what is possible or a strange idea of politics, where the impossible is one of the biggest vote-getters.

People can get the possible on their own. Politicians have to be able to offer the voters something that they cannot get on their own. The impossible fills that bill perfectly.

Duplicitous politicians are happy to offer what the voters want, even if they want the impossible. That's how they get re-elected.

Global warming: Reasons why it might not actually exist

2008 was the year man-made global warming was disproved, according to the Telegraph's Christopher Booker. Sceptics have long argued that there are other explanations for climate change other than man-made CO2 and here we look at some of the arguments put forward by those who believe that global warming is all a hoax.

The man-made global warming hysteria continues unabated despite all the evidence to the contrary. Can you say "Ice Age?"

Closet Keynesians Emerge

One of the best tests for determining whether a financial columnist or a professional economist is a Keynesian is to examine his views on personal spending. If he favors an increase of personal spending as a means to stimulate the economy, he is a Keynesian. He may not call himself a Keynesian, but he is a Keynesian.

Gary North explains John Maynard Keynes' influence on today's politicians. He also offers some advice a on how to protect yourself - as much as possible - during the recession and the resulting hyperinflation to come.

Spend Ourselves Rich

Fred Thompson does a number on the bailouts and Keynesian economics. Fred explains how the government plans to save us (if you look closely, you will see he has his tongue firmly planted in his cheek).

Worse than '29

Now, the days dwindle down to a precious few. And if some miracle doesn't happen this will go down as the worst year in Wall Street history.Worse than '29? Yes…a lot worse.

1929 had been a big winner for investors before the crash began in the last quarter. When the champagne was finally poured on New Year's Eve, investors were less than 10% below where they began the year.

This year has been all bad. Investors are looking at a loss over 40%. The typical investor in the stock market has probably lost half his money.

The news continues to confirm that a major correction is underway.

Bill Bonner gazes into his crystal ball and foresees trouble ahead.

Uncivil War: Detroit Blames the South

The free-market method would be to allow for a business environment that would be ideal for businesses to thrive (no taxes or stifling regulations); thereby encouraging companies to relocate to low-cost states on a mutually cooperative basis. This would engender competition among states that would drive down all costs everywhere. But that would mean that the people in power — the politicians and government planners — would become less influential and less wealthy; it is for that reason the free market has not prevailed.

Karen De Coster explains why the Detroit car makers have sold out to the UAW and are blaming the competition for their troubles.

Who Controls the Money?

[W]e have seen a $700 billion bailout program passed by Congress along with the nationalization of such huge failures as Fannie Mae and Freddie Mac. We have seen the Fed expand its loans in all sorts of directions, including a private insurance company, foreign central banks, commercial paper, and any number of insolvent U.S. banks. We have seen the U.S. government make any number of new and expanded financial commitments and guarantees that can explode its solvency at any time and lead to very high costs to society.

Once again, the government and the Fed are committing massive frauds. They are intentionally deceiving the public about the necessity and benefits of these expenditures. A great deal of money is being transferred to persons who should be absorbing losses that they are responsible for.

Michael Rozeff is concerned that the government has no idea where our money is going.

IT'S ALWAYS ISRAEL'S FAULT, RIGHT?

This is really so completely ridiculous. For days the Muslim Hamas goons in Gaza launch rockets at Israeli civilians. The "Arab world" is quiet. Then Israel retaliates and the "Arab World' suddenly goes nutso. How long do we tolerate this asinine double standard?

Where was the Arab world when those rockets were being fired at innocent Israelis? Sitting on their butts and shutting the hell up, that's where .. and the same goes for much of the oh-so-enlightened European Union.

I've been wondering the same thing about the criticism of Israel - seems to me they're just trying to stop Hamas from bombing Israelis. No one was criticizing Hamas when they were tossing the bombs.

Junk Economics

Our Dear Leaders have so thoroughly swallowed their own nonsense that they now genuinely have no idea what to do. They refuse to even contemplate addressing the problem at its source.

Our 'experts' continue to peddle the line that only more government intervention can solve the problems borne of government intervention. They throw more money and credit at problems caused by too much money and credit. They act as village lunatics who having dropped lighted cigarettes in the town barn then seek to make amends by throwing gasoline on the ensuing blaze; all whilst gormlessly staring around hoping for applause.

The government is coming to help us. Run for your lives!

Into A Parallel Universe

One day we swam along a deep wall at 120 feet, maybe fifteen of us, the sea dropping below us to blue-black night and the wall colorless in the crepuscular dimness of depth. It was deeper than a basic instructor would recommend, but Cap Divers was a bit of a cowboy outfit, and everyone was experienced. Curling misshapen growths of deep water projected from the rock like tangled ropes and distorted cups in some nightmarish basement. The only sounds were the slow ssssssss-wubbawubba of breath and exhaust and the locationless clicking of arthropods.

Fred Reed takes us scuba diving and shares his ruminations as he tours the briny waters.

There's No Pain-Free Cure for Recession

It would be irresponsible in the extreme for an individual to forestall a personal recession by taking out newer, bigger loans when the old loans can't be repaid. However, this is precisely what we are planning on a national level.

I believe these ideas hold sway largely because they promise happy, pain-free solutions. They are the economic equivalent of miracle weight-loss programs that require no dieting or exercise. The theories permit economists to claim mystic wisdom, governments to pretend that they have the power to dispel hardship with the whir of a printing press, and voters to believe that they can have recovery without sacrifice.

The federal government is on a spending binge while the rest of us are trimming our budgets and adapting to economic reality.

Somali Pirates to acquire Illinois Senate Seat

December, 2008 (Bloomberg)—After a successful hostile takeover of U.S. bank Citigroup, the Somali pirates are on track to secure a seat in the United States Senate. According to Pirate spokesman Ali Hashimi Mohammed, capital secured by Citigroup from the U.S. Treasury’s TARP program along with the booty of various captured ships is being used to finance a leveraged buyout of the seat previously occupied by President-elect Barack Obama. A letter of intent seen by Bloomberg puts the acquisition price at $1.2 trillion.

In a wiretapped conversation with Mohammed, embattled Illinois governor Rod Blagojevich said the seat “is a f****** valuable thing, you don’t just give it away for nothing.”

Mohammed countered that Citigroup’s corporate charter, now controlled by the Pirates, is itself “pretty f****** vaulable.”

Avast me hearties! Hoist the colors! T' scurvy land lubbers are givin' away the Motherlode. Arrr.

Classic TV Moments on YouTube

The first clip is a three-minute, mid-70s clip of Bob Hope, Bing Crosby, and John Wayne on the Tonight Show, with the sensational Don Rickles substituting for Johnny Carson. Note the Don Rickles comment to Crosby: "Bing, this is television." It's three minutes of sheer joy from four class acts. The thing I like most is the one-and-a-half minute standing ovation from the audience. When you see the audience you'll note that it is made up of mostly young kids, all dressed 70s-style, and they honor these classic and talented entertainers with vigorous applause.

Karen De Coster has posted some links to some entertaining YouTube clips from the '70's for some holiday diversion.

Aussies wobble after Ponting ton

Mike Hussey lasted only nine balls before he attempted to leave one from Steyn outside the off-stump but the ball brushed the toe of the bat as he raised it and went comfortably through to wicketkeeper Mark Boucher.

It was the left-hander's third duck in his last five Test innings, and in the final over before tea, Ponting was caught off bat and pad prodding forward, a triumph for left-arm spinner Paul Harris, who had just moved Hashim Amla into the short-leg position.

When Andrew Symonds slashed wildly and was superbly caught two-handed by Kallis diving to his right at slip, the Australians were 223-5.

Key quote: ...the South Africans were intent on restricting the scoring and got their reward when the wicketkeeper drove away from his body and was smartly snaffled by Graeme Smith at first slip.

Just thought you'd like to know how the cricket matches were going.

Santa Claus Bailout Hearings

Why not?

Remember who we are

[Y]ou'd think that we're like a bunch of white laboratory mice running around in a cage. The policy makers stand over us in white coats trying to figure out, "Well, do we need to give them a food pellet or an electric shock to get them to do what we want?"

Are we so lost today that we have forgotten that our great miracle has been produced by free people living in a free country?

Yet, now we hear from politicians that the problem is we're too free. We need more government, more regulations, more bureaucrats planning our lives and telling us what to do. Who is asking, given what made us great to begin with, if the problem is not exactly the opposite?

Star Parker is asking an important question.

Arrogant Conceit

"Painful crisis also provides us with an opportunity to transform our economy to improve the lives of ordinary people," Obama said.

His designated chief of staff, Rahm Emanuel, is more direct: "You never want a serious crisis to go to waste."

So they will "transform our economy." Obama's nearly trillion-dollar plan will not merely repair bridges, fill potholes and fix up schools; it will also impose a utopian vision based on the belief that an economy is a thing to be planned from above. But this is an arrogant conceit. No one can possibly know enough to redesign something as complex as "an economy," which really is people engaging in exchanges to achieve their goals. Planning it means planning them.

If the government really wants to help the economy, it should relieve Americans of the onerous burdens of taxes and regulations it has imposed on them.

Global Warming Rope-a-Dope

The global warming scare has provided a field day for politicians and others who wish to control our lives. After all, only the imagination limits the kind of laws and restrictions that can be written in the name of saving the planet. Recently, more and more scientists are summoning up the courage to speak out and present evidence against the global warming rope-a-dope. Atmospheric scientist Stanley B. Goldenberg of the Hurricane Research Division of the National Oceanic and Atmospheric Administration said, "It is a blatant lie put forth in the media that makes it seem there is only a fringe of scientists who don't buy into anthropogenic global warming."

The earth has gone through climate changes for 4.5 billion years and will continue to do so, whether or not mankind burns fossil fuels to heat their homes and power their automobiles.

Obama Teen Beat

The fact that sales at Starbucks are going down, while sales at McDonald’s are going up, shows that people are adjusting to economic adversity by cutting back their spending. Only in Congress do people adjust to economic adversity and growing deficits by spending more money.

It is fascinating to see that politicians whose interventions in mortgage lending have created a disaster in financial institutions are now moving on to intervene in the automobile industry.

Wal-Mart has done more for poor people than any ten liberals, at least nine of whom are almost guaranteed to hate Wal-Mart.

A few random thoughts from Thomas Sowell.

The Case for Ebeneezer

Make no mistake about it: my client has been the victim of a cruel criminal conspiracy to extort his money, as well as of such torts as intentional infliction of emotional distress, libel and slander, trespass, assault, malicious prosecution, battery, nuisance, and false imprisonment. To that end, my client may elect to bring his own suit, but for now let us focus upon his defense to this action. As we do so, pay particular attention to the utter contradiction underlying Dickens’ case: my client is charged with being a greedy, money-hungry scoundrel, and yet it is the conspirators against him who want nothing more than his money! Scrooge – unlike his antagonists – earned his money in the marketplace by satisfying the demands of customers and clients who continue to do business with him, and did not, as far as we are told, resort to terror or threats of death to get it. Perhaps Dickens does no more, here, than engage in psychological projection. In doing so, he reminds us of the definition of a "selfish" person as "one who puts his greedy interests ahead of mine!" Ebenezer Scrooge has been maligned for decades as rich, greedy and uncaring. It is time for a defense against those charges.

Madoff as Metaphor

[T]he government right now is using the same tactic to convince you that it is saving you from the recession. The whole scheme partakes of the same sense of denying reality that characterized Madoff's scheme. And I'm not just talking about Social Security, which is almost an exact replica of the Ponzi version, except that at least Charles Ponzi didn't force people to give him money. I'm speaking of something broader. The entire financial system that is propped up by the Treasury and the Fed is based on the same idea: that something out of nothing is possible.

Madoff and Ponzi were small time con artists. Bernanke and Paulson are running a much larger scheme.

Change you won't believe

We have to, so to speak, get to place mentally where we can face the kinds of change that are now necessary and unavoidable. We're not there yet. It's not clear whether the elected new national leadership knows just how severe the required changes will really be. Surely the public would be shocked to grasp what's in store. Probably the worst thing we can do now would be to mount a campaign to stay where we are, lost in raptures of happy motoring and blue-light-special shopping.

The economy we're evolving into will be un-global, necessarily local and regional, and austere. It won't support even our current population. This being the case, the political fallout is also liable to be severe.

Spending money we don't have for things we don't need cannot continue indefinitely. The sooner we accept economic realities, the sooner we will be able to adapt and deal with it.

The Bubble of Empire

It's been popped...

[T]he delusions of this ruling class will endure to the very end. The inhabitants of Washington, D.C., are incapable of realizing that the bubble of Empire has really popped, or can ever pop. They are like drug addicts who have imbibed so much of their poison of choice that their physiology has been permanently altered: they're always and forever high.

For sixty-some years we've been high on the delusion of our God-given omnipotence and inherent goodness, convinced we can and should right every wrong, police every border (but our own), and fulfill our alleged destiny as the Promethean light-bearer of the world. This is mental and moral inflation, which was certainly encouraged by the monetary phenomenon: these absurdly inflated goals were financed by imaginary wealth, a good proportion of which has already disappeared.

We are looking for solutions to our economic woes from the very people who caused the problems.

Who Decides Who Lives and Who Dies?

Medicare, no matter how it came into being, is now operating as an independent cause of social change. It is now fueling the trolley’s movement. Because Medicare pools health care money, it creates a problem for government bureaucrats of deciding who will get that money. They then invoke arbitrary criteria. For example, seeing that elder care costs more money per person than middle-age care, they decide to allocate less to the elderly and more to the middle-aged. They then argue that this is fair and just. Seeing that procedure A is more expensive than procedure B, they control (lower) the price of procedure A, and this creates excess demand for procedure A. The number of rules, restrictions, and controls is endless. Medicine becomes a branch of politics.

The politics of Medicare is explained.

No end to financial disorder

US policymakers remain oblivious to the economic and financial losses caused by unrestrained money and fiscal policies. Such a policy mix has not only caused a slowdown of the US economy, but it has spread economic recession to the rest of the world. As in previous bailouts and stimulus packages, the question of who pays for this stimulus package has never been asked. Of course, not one penny will come from Paulson, Democrat House speaker Nancy Pelosi, or Bernanke; foreigners perhaps, but most likely it will be shoplifting, that is, redistribution and forced inflation.

The belief that we can inflate our way to prosperity continues to be the only proposal being considered by our rulers.

Bush Hits a New Low

When he had to stand up in public and present a justification for his actions, however, Bush was invariably at sea. One could see him straining to recall the talking points his handlers had tried to instill in his mind. His wretched explanations were typically befogged by his misty incapacity to utter a simple, correct English sentence or to put two thoughts back to back in a logically connected way. The press and the public have often given him a pass because everybody suspected that he suffered from dyslexia and, some claimed, from the lingering effects of excessive use of cocaine, and so, strange to say, people felt sorry for the most powerful man on earth.

GWB has, with the best of intentions but with an apparent lack of anything resembling a plan, bumbled along for nearly eight years. His tenure has seen the growth of government, loss of individual liberties, loss of respect in the global community, unnecessary wars and a reckless spending spree from which we may never recover.

"U.S. Economy: The Philosopher's Stone"

We were warned by a few but their voices were ridiculed by the powerful. Now, the question is: can all the Fed's horses and all the government's dollars put the economy back together again?

We Are All Japanese Now

If our sage counsel had been courted, we would have told the feds to take the high road. Don't cut rates, raise them. Get it over with. Reward savers, not spenders. Give people a bonus for doing the right thing, not for doing the wrong thing.

We're not above a little showmanship either. If Obama wants to keep the masses at home watching TV rather than marching on the White House, he should offer a real stimulus:

Give people back their tax money. Declare a Tax Jubilee. No taxes in '09. No income taxes. No capital gains taxes. No federal taxes of any sort…not even any inheritance taxes. If we had our druthers, you could die in '09 and rest in peace…with no tax consequences…leaving your money to whomever you wanted.

Obama has a plan to take our money and spend it. Bill Bonner has a better plan. Let us keep our money and spend it ourselves.

Inflation = Prosperity

Hillarious and horrific propaganda from FDR's Hollywood. Or is it a report from tonight's CNBC?

This ridiculous explanation of the beneficence of inflation from the 1930's is still the basis of governmental economic interventions today. The Fed is desperately trying to reinflate the housing and credit bubbles instead of allowing prices and inflation rates to adjust to economic reality.

In Madoff We Trust

A chain letter is no more viable when run by governments than when run by private citizens. However, government orchestrated pyramids have the advantage of required participation. As a result, they can maintain the illusion of viability for several generations. But the longer such schemes operate the larger will be the losses when they ultimately collapse.

The Social Security Administration runs its “trust funds” with precisely the same methods used by Madoff and Ponzi.

What happens when the takers (Social Security recipients) demand more than the givers (workers) can provide?

Economic Freedom or Socialist Intervention?

I am afraid the American auto industry will soon learn that having billions rain down from Washington will not be the blessing one might expect.

The government, after it subsidizes an industry, tends to become a very demanding benefactor. Politicians may not have any real idea about how to build a car, run a bank, educate a child, heal the sick or build a road, but they are quite adept at using carrots and sticks to manipulate and threaten those who do. Most of the federal control over education, roads, healthcare, and now banking and soon auto manufacturing, is done through money, mandates and conditions.

What we should be doing to help the auto industry.

Counterfeiting Versus Monetary Policy

Knowing the dangers posed by central banks, we might ask whether our country needs the Federal Reserve Bank. Whenever I'm told that we need this or that government program, I always ask what we did before. It turns out that we did without a central bank from 1836, when President Andrew Jackson closed the Second Bank of the United States, to 1913 when Federal Reserve Act was written. During that interval, we prospered and became one of the world's major economic powers.

Walter Williams on the Fed, inflation and government.

The scandal is what's legal

A system that rewards politicians skilled at campaigning — which is the art of creating an illusion — and that puts hundreds of billions of coerced taxpayer dollars at the disposal of the winners will tend to attract men and women with a comparative advantage in manipulation. We shouldn't be surprised that people like Blagojevich prosper in "public service" — until they get caught crossing the line.

When government grows too big and powerful, it becomes corrupt. The most successful politicians tend to be the most corrupt, or, maybe it's vice a versa.

Dollar Staggers as U.S. Unleashes Cash Flood, Deficit

U.S. policy makers are flooding the world with an extra $8.5 trillion through 23 different plans designed to bail out the financial system and pump up the economy. The decline shows that the increased supply of money may be overwhelming investors just as the government steps up debt sales, the trade and budget deficits grow and de-leveraging by investors slows.

“The dollar will go to new lows as the U.S. attacks its currency,” said John Taylor, chairman of New York-based FX Concepts Inc., which manages about $14.5 billion of currencies.

Pumping out dollars - inflation - will result in higher prices and more debt to keep the economy from tanking. This policy is not sustainable. All debt must eventually be either repaid or renounced - the former seems unlikely and the latter would be disastrous.

Conservatives, Barely. Maybe. But I Doubt It.

I am trying to understand conservatives. The word has got to mean something, unless of course it doesn’t. For years I thought it meant someone like my grandfather, a professor of mathematics at a small college in the South. He embodied courtesy, respect for learning, personal responsibility, compassion for those in the town who found themselves in distress, dignity, a love of the language, a morality opposed to promiscuity and bastardy, and a quiet Christianity having nothing in common with the cruelty and hostility of today’s unlettered evangelicals. I thought it a pretty decent package, though I had problems with the part about avoiding promiscuity.

As I once considered myself a conservative, I had to say "ouch" a couple of times as I perused this column. I no longer identify with many conservative convictions such as "nation building" and the "war on drugs". I do think we should return to a constitutional government which puts me at odds with some libertarians so I'm just a lost soul with no political party to latch on to. Well, that suits me just fine. I can badger anybody without regard to their political affiliation.

Amish homeowners: Religion trumps building codes

TOWN OF FRANKLIN, Wis. – Daniel Borntreger's home looks like hundreds of other Wisconsin farmhouses: two-story A-frame, porch, clothes on the line.

But his home could cost him thousands of dollars in fines. Borntreger, an Amish farmer, built the house himself according to Amish tradition — but without a building permit.

Interesting confrontation between the Leviathan and Amish farmers. This isn't a freedom of religion issue - it's a freedom issue, period. Where does government get the power to tell anyone how to build their home on private property? Hint: it does not come from the Constitution.

Government Spending and the Risk of Ruin

This business cycle is worse, much worse, and it will stay much worse than prior recessions. The problems of the economy will not be resolved by anything that the government and the Fed are now doing or contemplating doing. These problems are too deep and structural. The financial system has failed, but the problems are far more profound. They arise from a long-term set of government and monetary policies, and they go to the production structure of American business. They reach overseas into trade issues. They reach into our poor educational system. They reach into ethical failings. They reach into misguided war policies. When a social and economic system has been misled for decades, the results go deep. They can’t be altered by public works spending and money-pumping.

Waiting for the economy to turn around? Don't hold your breath.

Pay-to-Play: Why the Fuss?

The even bigger absurdity of the establishment’s "outrage" over the behavior of the Illinois governor is highlighted by the fact that selling political favors defines what Washington politics (and all other politics in America) is all about. With the lone exception of Congressman Ron Paul, every Washington politician spends most of his time selling political favors of one kind or another. Legislation and regulation is "sold" for campaign "contributions," kickbacks, highly-paid jobs for relatives and friends, and various "in-kind" goodies. It’s what they do. It’s what politics is about. The governor of Illinois is not guilty of anything more than what almost every single politician in Washington does every single day.

We are still being entertained with the "outrage" over the Illinois governor's attempt to sell Obama's senate seat. It's just politics as usual.

Will the other Ponzi schemes please stand up

Wall Street executive Bernard Madoff was recently arrested after admitting to his sons and later, to the FBI, that he was running a gigantic Ponzi scheme -- to the tune of $50 billion. He is now being sued by a number of investors.

And the band played on: covering the economic crisis

[I]n the month preceding the week of Sept. 15, which saw the Lehman bankruptcy, the Merrill Lynch sale, the AIG bailout and large drops in share prices, the proportion of the news hole devoted to the economy reached a low for the year, filling only 4.8 percent of the time on television and radio and space in the print and online media.

The press was mesmerized by Sarah Palin and Joe the plumber and failed to report on the looming economic crisis until the crisis was upon us and could not be ignored any longer. Why? I suppose it is because they do not believe their readers and viewers to be intelligent enough to stay tuned while they discuss meaningful issues - or maybe they are not intelligent enough to report on meaningful issues. Either way, it's a major reason the mainstream media are losing credibility and audience share to the internet.

Rectitude Chic

For a generation we've been tapping on plastic keyboards, entering data into databases, inventing financial instruments that are abstract, complex and unconnected to any seeable reality. Fortunes were made in the ether, almost no one knows how; there's a sense that this was perhaps part of the problem. Workers tapped on keyboards and produced work they cannot see, touch or necessarily admire. They'd like to make their country better, and stronger, in a way they can see.

Peggy Noonan, always more eloquent than most, is also a bit more optimistic about the ability of Americans to overcome the present malaise than most.

Emanuel Had Contact With Governor’s Office on Senate Seat

The Obama associates said the interactions concerned several people who might fill the seat. Such contacts are common among party officials when a political vacancy is to be filled. It was not clear whether the communication was via direct telephone calls.

The Chicago Tribune reported that communications between Mr. Emanuel and the governor, both Democrats, had been captured on court-approved wiretaps, but Obama associates gave conflicting accounts of the interactions.

Meanwhile, the mainstream press is still shocked that politics became involved in the selection of Obama's senate seat. We don't know how many honest politicians (besides Ron Paul) are in government but we would really be shocked to find many who don't play these kind of games behind their closed doors. It's only a news story because Gov. Blagojevich employed creative new ways to use an offensive expletive more so than creative politics - and he apparently is inept with technology and unaware of the vast scope of the Patriot Act. They'll have to be a little more cautious with their cell phones and Blackberries in the future. As Lord Acton observed: "I cannot accept, your canon that we are to judge pope and king unlike other men, with a favorable presumption that they do no wrong. If there is any presumption, it is the other way against holders of power...."

Congressman Ron Paul on Bailing Out the Auto Industry

If you follow this blog (a few of you do) you might have noticed my absence over the last three days - I've been a little under the weather but I'm back in the saddle again. As I get my bearings, we'll look around for good articles to link to and comment on. Here's one to get you started. I see the automobile bailout is still an item of discussion so I'll let Dr. Paul explain how that's going.

UN Blowback: More Than 650 International Scientists Dissent Over Man-Made Global Warming Claims

POZNAN, Poland - The UN global warming conference currently underway in Poland is about to face a serious challenge from over 650 dissenting scientists from around the globe who are criticizing the climate claims made by the UN IPCC and former Vice President Al Gore. Set for release this week, a newly updated U.S. Senate Minority Report features the dissenting voices of over 650 international scientists, many current and former UN IPCC scientists, who have now turned against the UN. The report has added about 250 scientists (and growing) in 2008 to the over 400 scientists who spoke out in 2007. The over 650 dissenting scientists are more than 12 times the number of UN scientists (52) who authored the media hyped IPCC 2007 Summary for Policymakers.

Maybe you can postpone getting a windmill in your backyard before you take another hot shower. Maybe driving your SUV to work didn't cause the North Pole to melt. Maybe, just maybe, you didn't kill all the polar bears when you barbequed that pork roast in July.

What if Steve Jobs ran one of the Big Three auto companies?

Looking for improved business models for the personal computer business, Apple CEO Steve Jobs often used to cite automobile makers, though never American car companies. The examples were invariably German. Whether it was the design aesthetic of his Mercedes sedan or Porsche's success at selling high-margin cars as entertainment devices, Jobs could always point to farfegnugen as a way to sell a good car for a great price. So since he thinks about these things anyway, and because the U.S. automobile industry is on the skids and begging for help this week, I find myself wondering what would happen if Steve Jobs were put in charge of any of the Big Three car companies?

Maybe the Detroit Three don't need a bailout - maybe they need Steve Jobs.

House getting concealed weapons bill

A South Carolina House member is filing a bill to allow residents to carry weapons without a permit.

Ways and Means Committee Chairman Dan Cooper of Piedmont said Tuesday he has filed legislation to allow any law-abiding citizen to carry a weapon.

The Republican says concealed weapons permit laws and other restrictions make it less likely people who obey the law will be armed and does nothing to disarm people willing to break the law.

Citizens should be allowed to protect themselves without getting state approval. Dan Cooper wants to remove the constraint of licensing law-abiding citizens in South Carolina.

Oldsmobile Nation

The banks' losses have been laid out for all the world to see. Then Congress engineered a series of bailouts to allow huge banks to be absorbed by larger banks. Number-four Wachovia was absorbed by number-one Citigroup in late September. Two months later, Citigroup was within a weekend of bankruptcy. The Treasury Department bailed it out.

Zombie banks. Zombie loans. Zombie taxpayers. It's the year of the living dead.

The government's efforts to control the auto and banking industries are examined by Gary North.

Illinois Governor Rod Blagojevich taken into federal custody

The complaint contends Blagojevich, a Democrat, threatened to withhold substantial state assistance to the Tribune Co. in connection with the sale of Wrigley to induce the firing of Chicago Tribune editorial board members critical of Blagojevich.

The governor is also accused of obtaining campaign contributions in exchange for official actions — in the past and recently in a push before a new state ethics law takes effect Jan. 1.

Blagojevich, 51, and Harris, 46, both of Chicago, are each charged with conspiracy to commit mail and wire fraud and solicitation of bribery. They were charged in a two-count criminal complaint that was sworn out on Sunday and unsealed today following their arrests, which occurred without incident, the feds said.

Never trust a politician.

The Attack on Free Markets

Government failure, not market failure, would be a more accurate description of the subprime/credit crisis. There would have been less risk-taking and more market discipline if Congress had not guaranteed Fannie and Freddie debt and had not passed the Community Reinvestment Act, which pressured banks to promote subprime and Alt-A mortgages. Moreover, by holding the Federal funds target rate at 1 percent from July 2003 to June 2004, the Fed fueled the housing boom.

Regulation, not deregulation, was the cause of our current economic woes.

Is Deregulation to Blame?

You might not be able to tell by looking at it on the page, but deregulation has become a four-letter word in Washington. In October’s vice presidential debate, Sen. Joe Biden (D-Del.) practically spat it out: “If you need any more proof positive of how bad the economic theories have been, this excessive deregulation, the failure to oversee what was going on, letting Wall Street run wild, I don’t think you needed any more evidence than what you see now.”

Deregulation? What deregulation?

The Perfect Stimulus Package

With the Gohmert plan the politicians don’t get to decide who gets to spend the stimulus money. This doesn’t thrill politicians. Somehow the very act of getting elected to high office seems to imbue politicians with some sort of a supernatural power to know exactly how every dollar in our economy is to be spent. The Gohmert plan would take that right away from them.

An interesting plan to stimulate the economy.

Gun Control: Protecting Terrorists and Despots

How were these terrorists able to continue so long, relatively unchallenged, killing so many?

India’s gun laws are her business, of course. However, once the shock of these events and the initial reaction of fear passes, Americans should take away a valuable lesson about real homeland security and gun control from this tragedy.

Some common sense notions on guns, gun free zones and the second amendment.

Here's some news

Slow day so far. Here's some news...

Poll: 67% cutting back on holiday spending
Dow Chemical to Cut 5,000 Jobs, Close 20 Facilities
Obama to send 'clear message' to Russia over neighbors
Russia to inject $150 bln into military-industrial complex
Sarkozy and Brown in economy talks
The computer mouse turns 40
Archaeologists find string dating back 8,000 years
'Mumbai mastermind' arrested in Pakistan
UK: Traditional subjects go in schools shake-up
Schwarzenegger tells UN Green rules help markets
China says Sarkozy will pay for meeting Dalai Lama
Iran says will not halt atom work despite U.S. demand
Iran rejects Obama's carrot and stick policy
Taliban said in 72 pct of Afghanistan
Taliban chief: More fighting to come
Blackwater guards plan Utah surrender
Raul Castro defiant of US embargo on eve of summit
Greece braces for third day of riots, counts cost
Liberals voice concerns about Obama
UK: Middle class facing jobs bloodbath
S. California residents trading guns for food
Merrill chief seeking $10 million bonus for 2008
Central Bank Cash May Hamper Money Markets
Obama Bonds to Give Buyers Taste of Japan Lost Decade
China Is ‘Highly Unlikely’ to Devalue Yuan
Hedge Fund Withdrawals Accelerate
Obama unveils $1 trillion stimulus

December 7th, 1941

We recall precisely where we were and what we were doing on that long ago Sunday when we heard John Daly's voice on the Atwater Kent radio in the den. He read a flash news bulletin describing a bombing at Pearl Harbor.

Most Americans had no idea where Pearl Harbor was or what it had to do with the United States. But we learned a lot about Hawaii, the Pacific, and Japan that day sixty-seven years ago. Sadly, the number of people who actually remember Pearl Harbor is dwindling rapidly.

Thanks to JW for reminding us that this is Pearl Harbor Day.

Where have you gone, Sheriff Taylor?

Rights? Schmights!

What we wind up with is a petty police state, haphazard and aggravating more often than not. Kafkaesque, sometimes. Certainly, the opposite of my favorite lawman, Andy Taylor.

Now, Kafka never watched The Andy Griffith Show. It wasn’t high art, or black comedy, so I’ve no sure idea what Kafka would have thought of it. But Sheriff Andy Taylor of Mayberry never used his toughness in a bullying or bureaucratic way. He was respectful of the public, interpreting both the rules and his own discretion with a heavy dose of common sense.

We could use a little more common sense - "Common sense is not so common" as JW likes to point out.

Bridge Loan to Nowhere

This week, the Detroit Three were back, plans in hand and determined to show that they were appropriately chastened. In the interim, their need for taxpayer cash grew to $34 billion from $25 billion -- and GM said it needs $4 billion just to make it to Christmas. But instead of viability, what they've come up with is green political correctness. Their plans -- and Thursday and Friday's hearings on the bailout -- show how dangerous it is to throw your business upon the harsh benevolence of Congress.

The Detroit Three - Richard Wagoner (GM), Alan Mulally (Ford) and Robert Nardelli (Chrysler) - crawled back to Congress last week in a repugnant display of pleading and belly-aching for handouts that was hardly a shining example for future entrepreneurs and business leaders. It's hard to imagine a John D. Rockefeller or Andrew Carnegie ever groveling for loans from the likes of Barney Frank and Nancy Pelosi, but these guys apparently would rather let Congress run their business than do the job themselves.

Malice disguised as misfortune

If everyone in a country uses the same medium of trade–like the “dollar,” for example–and you have the ability to mess with it, THEN, and only then, do you have the ability to kill an entire economy without 99% of your victims having the slightest idea how you did it. In fact, they won’t even know THAT you did it, or that anyone did it. Being unable to understand it, they are likely to assume that it’s just some weird, complicated, naturally-occurring phenomenon. And why is that? Because most Americans, including most college graduates, know dang near NOTHING about money and currency, debt and banking. Is that because it’s too complex? Hardly.

A nice refresher course on basic economics.

Let's Go Back...Waaay Back

We've been thinking about posting this for a while now. Remember Rocky and Bullwinkle and the "Way Back Machine"? Let's go back. Way back. To Genesis and beyond.

Don't freak out. This is an excursion into your imagination. Before teachers and preachers, before prophets and fortune tellers, before politicians and bureaucrats, before time itself.

Way back, way way back.

What was there before the beginning? Ah, now we're getting there; way way back. Are you with me? Let's imagine for that's the only way to get there...

Imagine there's no heaven
It's easy if you try

...and here we are: at the beginning. And you are in charge! What to do?

Let's create something. You need someplace to put it. You'll need a universe...

ZOT!

OK. Now you'll need stuff. Let's create galaxies, lot's of 'em - billions.

ZOT!

So much stuff! Billions of galaxies with billions of stars with billions of planets. You need someone to appreciate all this stuff. Find a remote planet wandering around a remote star in a remote galaxy and create a being from the dust on that insignificant speck and then you'll feel really important if he praises you for all your accomplishments. And, if he doesn't, you'll show him who's boss.

Now what? You've got a few million souls on a remote planet and you've got them convinced that every detail of their insignificant lives is deserving of your attention at any time, day or night. You've got other stuff to do - like parallel universes and stuff like that and these people keep praying and bowing and killing each other because they think you're so cool. You do remember creating the earth about eight billion years ago, don't you?

Now, these folks are starting to annoy you with all their caterwauling about how the economy stinks and wars and plagues and droughts and dandelions in the front yard so you show your wrath. You give them Henry Paulson and Ben Bernanke - the ol' double whammy!

Now they're really scared! They want a bailout. The question for you is this: Should you give it to them?

Think carefully and deliberately but remember this: If you lose this planet, there are plenty more.

U.S. Collective Dictatorship Enlarges

Dictatorship is unlimited rule. Collective dictatorship is unlimited rule by an assembly.

In the U.S., the Fed has no statutory limits on its finance! It is openly financing whatever institutions it pleases. In particular, the Fed is directly financing the government’s Troubled Assets Relief Program with $440 billion. It has extended $56 billion to AIG company, another $298 billion for the commercial paper of various companies, and $407 billion to banks using its own holdings of Treasury securities. The critics of these loans are vastly outnumbered by those applauding the Fed’s inflation as the means of saving America. The sycophants eagerly await the Fed’s next moves.

Government intrusions into the free market bodes ill for freedom.

The Man Who Predicted The Economic Meltdown

As one in a small group of analysts who publicly predicted the collapse of the American financial system, Peter Schiff was a lonely — and much maligned — voice on cable's financial news shows.

In August 2006, Schiff, the self-confident president of the Connecticut-based brokerage firm Euro Pacific Capital, warned viewers on CNBC that the U.S. economy would be hampered by "too much consumption and borrowing and not enough production and savings."

"What's going to happen is that the American consumer is basically going to stop consuming and start rebuilding his savings, especially when he sees his home equity evaporate," he said. "And when you have the economy 70 percent consumption, you can't address those imbalances without a recession."

MSM interviews with Peter Schiff are usually entertaining as well as informative. The interviewers are generally baffled and confused and unable to comprehend his views because they are fully convinced that government has the answers. Case in point is this NPR article. The writer, David Folkenflik, admits Schiff predicted our present plight but, towards the end, scoffs at his proposals to improve the situation.

The Fallacy That Government Creates Jobs

Keynesian theory sounds good, and it would be nice if it made sense, but it has a rather glaring logical fallacy. It overlooks the fact that, in the real world, government can’t inject money into the economy without first taking money out of the economy. More specifically, the theory only looks at one-half of the equation — the part where government puts money in the economy’s right pocket. But where does the government get that money? It borrows it, which means it comes out of the economy’s left pocket. There is no increase in what Keynesians refer to as aggregate demand. Keynesianism doesn’t boost national income, it merely redistributes it. The pie is sliced differently, but it’s not any bigger.

This should be glaringly obvious but politicians are able to see only that they are providing "help" and are unable to see that they are robbing others to provide it.

Who makes the best cars? We don't know.

The unions don't want to see GM or Chrysler go under. They've been feeding at that trough for a long time; they don't want to stop now. The shareholders don't want to see them go down either. They've got money at stake. Nor does management…nor do any of the subcontractors, dealers, or service industries related to automobiles…or the hundreds of thousands of people they employ.

They're all "stakeholders," they say. And they're prepared to reward members of Congress who help them protect their 'stakes' and punish those who don't.

Of course, all say they believe in free enterprise…and in market economies. But all will tell you that there are special circumstances in this case. Everyone always has plenty of reasons why the rules of a free society shouldn't apply to them…at least not just now.

Politicians + lobbyists + unions + payola = business as usual.

The Great Society: A Libertarian Critique

The Great Society is the lineal descendant and the intensification of those other pretentiously named policies of 20th-century America: the Square Deal, the New Freedom, the New Era, the New Deal, the Fair Deal, and the New Frontier. All of these assorted Deals constituted a basic and fundamental shift in American life — a shift from a relatively laissez-faire economy and minimal state to a society in which the state is unquestionably king.

Murray N. Rothbard was a critic of the Lyndon B. Johnson plan to grow government by making people reliant upon it. This may not have been LBJ's intention - it's hard to say what his intention was - but, if we had listened to Mr. Rothbard then, we would be better off now.

Council passes controversial bill on stolen guns

Pittsburgh City Council gave its first approval today to legislation requiring that anyone report a lost or stolen firearm report that within 24 hours or potentially face a $500 fine.

The 6-1 vote, with two abstentions, sets up a final vote likely next week, which would send the legislation to Mayor Luke Ravenstahl for his signature or veto, and then potentially to the courts, where similar measures have been challenged.

"Who really cares about it being unconstitutional?" said Councilwoman Tonya Payne...

Indeed, who cares? This is the same anachronistic document which GWB supposedly described as "just a goddamned piece of paper."

What Have the Bastards Done to My Country?

I don’t get it. This is the country that produced Peggy Lee and Tampa Red and the ‘fitty-sedden Chevy, the country that spits techno-whizz golf carts onto Mars just like it was even possible, that brought the hamburger to gorgeous bejuiced perfection and invented most of the modern world. It’s the home of sand-lot baseball and Little Peggy March and BB guns and Tasty Freeze. It is, in a phrase, one fine place.

How did it sink to being a proto-Soviet surveillance state that builds vast awful Visitor Centers in the style of a Hitlerian mauseoleum? You can’t go to the john without a photo ID anymore. Something ain’t right.

Ah, it's good to hear from Fred again. The irascible reporter went to DC and shares his laconic observations on the goings on there.

Let's End Drug Prohibition

It's already shaping up as a day of celebration, with parties planned, bars prepping for recession-defying rounds of drinks, and newspapers set to publish cocktail recipes concocted especially for the day.

But let's hope it also serves as a day of reflection. We should consider why our forebears rejoiced at the relegalization of a powerful drug long associated with bountiful pleasure and pain, and consider too the lessons for our time.

Say what you want about alcohol and prohibition - i.e., the prohibition of alcohol imposed by the 18th amendment in 1919 and repealed by the 21st amendment in 1933 - , it was at least constitutional. Say what you want about drugs and the War on Drugs, it is not legitimized by the constitution but is government imposing its will on the citizenry.

U.S. Automakers Get What They Deserve

Where do they get these ideas? What makes anyone think you can solve the problem of excess debt by lending people more money? Who is dumb enough to think that you can cure the problem caused by too much spending…by spending more?

Who's that dumb? Well, most of the world's leaders and top economists…or so it appears.

They have their claptrap theories, of course. But theories don't really count for anything. We've seen that. They all believed in the free-market…right up to the moment the free-market seemed to be failing. Then, they believed they had to "do something" to protect people. Protect them from what? Protect them from getting what they deserved!

Congress, bailouts and other idiocy.

Unarmed and helpless

It's clear from the WSJ account that Mumbai (and apparently the whole of India) is a virtually gun-free zone, and this permitted the ten terrorists to roam across the city, slaying people with impunity. In fact, they didn't even have to fear the police! Two of them moved through Mumbai's railroad station, tossing grenades and mowing down travelers with gunfire. Several dozen police officers were on duty at the station, but that made no difference (emphasis added):

B.S. Sidhu, head of the Railway Protection Force for the Mumbai region, says that while some officers tried to fight back, there was little his force could do. Most police officers at the station -- as they are throughout India -- were unarmed or carried only bamboo sticks known as lathis. More than 40 people, including three police officers, were killed in just a few minutes, authorities said. The wounded survivors screamed for help amid acrid smoke, piles of slumped, bloodied bodies and spilling suitcases.

Our governments pass laws which do not allow us to arm ourselves in order to protect ourselves when we are confronted by people who do not obey their laws.

See also Free Plaxico Burress.

The Lessons of Prohibition

When America repealed prohibition, we repealed it with a constitutional amendment making explicit that the power to regulate alcohol is reserved for the states. Even today, when Congress wants to pass federal alcohol laws (such as the federal drinking age, or the federal minimum blood-alcohol standard for drunk driving), it can't simply dictate policy to the states. Instead, it ties the laws to federal highway funding, a blackmail that while distasteful, at least carries the pretense of adherence to the Constitution.

Contrast that to drug prohibition, where Congress (and the Supreme Court, when it upheld it) made no attempt to comply with the Constitution in passing the Controlled Substances Act of 1970 (CSA), the law that gave us the modern drug war.

Radley Balko says we learned little from the Prohibition experiment.

The Philosophy of Liberty

The Philosophy of Liberty (PoL) is a 2006 flash animation based on the epilogue of Ken Schoolland's book, "The Adventures of Jonathan Gullible."

The philosophy of liberty is based on self-ownership. This simple but elegant and hard-hitting animation will explain exactly what that means. It's a great tool anyone can use to educate children and adults about our right to life, liberty, and the property we create - and our responsibility to think, speak and act.

Nice video. Something to mull over as we survey the passing parade. (This is not an endorsement of the Populist Party ~ ed.)

Private-Sector Health Care Leads the Way

Wal-Mart now offers walk-in, inexpensive healthcare services by leasing store space to private health clinics. This service, combined with an in-store pharmacy that offers $4 prescriptions, will offer these services to millions of people, and there is no requirement to have health insurance. Consider this: Wal-Mart's $4 prescription program has saved customers over $1 billion dollars since its inception. Prices are a flat fee of around $45 per visit, and are well advertised, i.e., there is no guess work, and price transparency exists. Contrast this with a typical doctor's visit where you might not know what you are paying until three months later.

Wal-Mart is competing successfully with government subsidized health care. It is only a matter of time before Congress finds an excuse to pass laws to eliminate the competition.

The Current Global Financial & Economic Crisis

All those little personal indulgences which we take for granted, and which in aggregate cost much more than pocket change, may have to be given up in the interest of saving for the proverbial rainy day.

In their place will be fewer trips to the shopping mall, older cars, less distance driven in the interest of fuel savings, more meals at home, fewer and more modest vacations, more saving, fewer credit card purchases, less debt and lower monthly payment obligations. This describes a lower standard of living ahead. It is guaranteed for most of us and it is likely to become permanent. Thrift will again become a value to which many will subscribe. It will become respectable, even cool, to be thrifty.

We highly recommend pinching pennies in any environment, especially the one we find ourselves in now. Regretfully, that will mean not buying the latest doodad to come down the pike and making what we have now last a little longer. Alas, I miss the good old days - it seems like they were only yesterday. Come to think of it, they were only a few weeks ago, at least that's what we were told then.

Where Does the Money Come From?

A caller complained about low wages. Krugman said the best way to address this is through adoption of Universal Healthcare. You see, if workers had free healthcare, this would help with the household budget burden. This is a true statement as long as those same workers are not hit with an equal or greater tax burden to pay for Universal Healthcare.

Krugman continued to argue that corporations will also benefit from Universal Healthcare because the won't have to provide healthcare as part of the benefits package and can instead pay a higher wage. This will raise people up from the lower to middle class and save the companies money (he used the Big Three as an example).

Kathryn Muratore wonders who will pay for "free" healthcare. Corporations are already going broke paying for it so they want to be let off the hook too. That leaves the "wealthy" to pick up the tab. Krugman - recently awarded a Nobel trinket for his economic astuteness - apparently believes we can continue to plunder the nation's wealth with no detriment to our finances.

Government Sets Us Up for the Next Bust

Jim Rogers, the successful investor and author, puts it well: "Why are we bailing out Citibank? Why are 300 million Americans having to pay for Citibank's mistakes? The way the system is supposed to work [is this]: People fail. And then the competent people take over the assets from the failed people, and then you start again with a new stronger base. What we're doing this time is ... taking the assets from the competent people, giving them to the incompetent people, and saying, "OK, now you can compete with the competent people." So everybody's weakened: The whole nation is weakened, the whole economy is weakened. That's not the way it's supposed to work."

Government manipulations in economic matters created the financial crisis. Further meddling will disrupt the necessary corrections.

Welcome to the Recession - Already in Progress

Sometimes we just can't keep up with these smart fellas from the big city…

Let's try again.

The U.S. government borrows money from taxpayers…gives it to Wall Street so they can lend it back to the taxpayers at a profit. Wall Street borrows 'our money' from the Fed at, say, 1%…then they lend it back to us at, say, 6% or 7%. That way, Wall Street makes money and we can still borrow what we need.

Nice system huh?

Bill Bonner knows how the system works.

What Did Harry Reid Say?

shack: "The only thing that really smells in D.C. is Reid and the rest of the thieves in Congress."
jimvincent2112: "A real man of the people, that one."
amountaingurl: "Harry Reid, you are a JERK!"
dastr: "I can not believe this man is leader of the senate. He is one big joke."
joner91: "This man is an idiot. He ceases to amaze me. Why does Nevada keep electing this moron?"
gotteethfornow: "Mr. Reid You really are the dumba** you play on television! Regards, Mr. Taxpayer"

What did Harry say to get responses like this? Click here to find out.

The Rationale of Terror

"Terrorism is a tactic, a technique, a weapon that fanatics, dictators and warriors have resorted to through history. If, as Clausewitz wrote, war is the continuation of politics by other means, terrorism is the continuation of war by other means."

Yet terrorism -- the killing of innocents for political ends -- can only triumph if the aggrieved play the role the terror masters have scripted for them in their bloody drama. What, then, may we surmise are the tactical and strategic goals of the terror masters of Mumbai?

Terrorism's intent is to goad the victim into senseless and aimless retaliation, thus wreaking havoc on the economy and demoralizing the enemy. The 9/11 terrorists succeeded beyond their wildest imaginations.

The Neo-Alchemy of the Federal Reserve

One key attribute that gives money value is scarcity. If something that is used as money becomes too plentiful, it loses value. That is how inflation and hyperinflation happens. Giving a central bank the power to create fiat money out of thin air creates the tremendous risk of eventual hyperinflation. Most of the founding fathers did not want a central bank. Having just experienced the hyperinflation of the Continental dollar, they understood the power and the temptations inherent in that type of system. It gives one entity far too much power to control and destabilize the economy.

The future of the US dollar is somber as ongoing and pending political plans are to inflate the currency to disguise debt and shroud reality from the public.

Governors Against State Bailouts

One fact that's been continually glossed over in the bailout debate is that Washington doesn't have money in hand for any of these proposals. Every penny would be borrowed. Estimates for what the government is willing to spend on bailouts and stimulus efforts for this year reach as much as $7.7 trillion according to Bloomberg.com -- a full half of the United States' yearly economic output.

With all the zeroes in the numbers, it's no wonder Washington politicians have lost track.

Bad business models are failing and the federal government is going further in debt to support them. Reasonable people are yelling "Stop it!" but the politicians have been deafened by the din of the Fed's printing presses.

Same Old New Deal?

The assumption is that the New Deal vanquished the Depression. Intelligent, informed people differ about why the Depression lasted so long. But people whose recipe for recovery today is another New Deal should remember that America's biggest industrial collapse occurred in 1937, eight years after the 1929 stock market crash and nearly five years into the New Deal. In 1939, after a decade of frantic federal spending -- President Herbert Hoover increased it more than 50 percent between 1929 and the inauguration of Franklin Roosevelt -- unemployment was 17.2 percent.

Nice analysis of the New Deal by George Will. It was not a quick fix for the depression.

I'm Waiting Impatiently for My Bailout

The only problem I can see is that they didn't finish the job. Think back. Remember when the president was asked, When will the troops come home from Iraq and Afghanistan? His no-nonsense reply was loud and clear: when they've finished the job. Well, my fellow Americans, a bailout is much like a war. Both involve a lot of foolish government decisions, a lot of lies and propaganda, and a lot of wasted money and sanity. And, like a war, a bailout cannot be described as a "mission accomplished" until our brave boys at the Treasury and the Fed have finished the job.

Have you gotten your bailout handout yet? Nope? Me neither but, since everyone seems to be getting one, I'm sure we'll be next.