The Cash Nexus, Niall Ferguson

"Money and Power in the Modern World, 1700-2000".

I continue to marvel at Ferguson, "erudite" is a word that clearly applies. Hopefully I'll be able to get some blogs out on a series of books to provide myself with perspective of the current financial and political state of the US and the world, and this book is one of the cornerstones.

"This books conclusion is that money does not make the world go round any more than the characters in "Crime and Punishment" act according to logarithm tables. Rather it has been political events --above all wars--that have shaped the institutions of modern economic life: tax collecting, bureaucracies, central banks, bond markets, stock exchanges. Moreover, it has been domestic political conflicts--not only over expenditure, taxation and borrowing, but also over non-economic issues like religion and national identity-- that have driven the evolution of modern political institutions: above all, parliaments and parties."

Niall isn't the most reachable of authors, but he did deliver on that thesis in my opinion.

"In the modern democracy...policy may ultimately be controlled by, and in the interests of, the majority of an electorate consisting mainly of the poorer classes, while revenue is obtained mainly from a minority of wealthy persons."

"The lack of deficits before 1973 also casts doubt on the theory of the inherent "democratic deficit", which predicts that democracies will tend to run deficits because the electorate favors public spending but is averse to taxation". 

Ferguson is British, so Britain gets at least as much scope as the US, but he is trying to be general. Essentially, a lot of the issues come back to the old "gold question". Without a fixed peg, countries and financial systems tend to just float off into speculation, inflation, and finally crash.

"Set in this comparative perspective, the subsequent increase of the debt under Reagan--which at the time caused commentators so much angst--was modest ..."

His point, as is the point of the book, is PERSPECTIVE -- relative to GDP, relative to winning the cold war, relative to historical debt in the US and other countries. One of the main weapons the MSM and especially left politicians like to use is the supposed "primacy of the moment". What is happening TODAY is "special, unique, maybe a "crisis", maybe "the greatest (or worst) ever" ... depending on of course who is in power. For the MSM, deficits under Reagan and under Bush were horrific -- deficits 3-5x as large under Obama? No problem at all, with many talking heads indicating that they "ought to be larger", and "deficits aren't really a problem.

"All these countries are actively encouraging their citizens, by a variety of incentives, to provide for ill health or retirement by investing directly, or through mutual and pension funds, in the stock market. In combination, these forces are causing an unprecedented shift in the balance of financial forces, so that the market capitalization of the NYSE is now for times greater than the stock of US Treasuries."

Er, at least they WERE encouraging (Britain, Germany, US, etc) ... with the failure of trying to start some privatization of FICA and now the add of health care to the never ending list of "entitlements", it appears that the US has lost it's way from this happy approach.

"Since 1899 the price of a loaf of bread in Britain has risen by a factor of 32; the price of an ounce of gold by factor of 38. Indeed, an ounce of gold buys approximately the same amount of bread today as it bought in the time of Nebuchadnezzar, king of Babylon, more than 2,500 years ago."

As I said, I'm reading a series of books on past and present economic and political crisis. The basic bottom line is "get at least 5% of your portfolio in gold -- maybe 10%".  Pay no attention to what looks like "record prices"  --  ratios like the above tell you what you need to know. When governments get stupid, private ownership of gold as a store of value is key, and the time to buy is NOW -- before they make it illegal to own gold, as they did in the past.

"Past experience therefore tends to suggest that asymmetric fiscal problems--often, but not necessarily generated by war--quickly cause monetary unions between politically independent states to dissolve. In the case of present day Europe, it seems quite possible that the strains caused by unaffordable social security and pension systems could have similar centrifugal effects ..."

What is obvious to a historian like Ferguson, and what ought now be obvious to even the most out of touch liberal at this juncture, is that most of the worlds social security, pension, and medical systems are unaffordable. When something can't go on forever, it doesn't.

"further democratization may retard growth because of the heightened concern with social programs and income redistribution"

"...concluded that political instability is more harmful to growth than the absence of democracy".

In other words, investors and business people know they have to deal with "real risk" -- competition, natural disaster, price fluctuations, etc. What  they can't deal with is "created risk" -- what new tax, fee, rule, directive, price control, etc will be randomly hurled down from the idiots in Washington (or London). They know that the "real risk climate" is pretty much a constant and beyond anyone's control, but once they have seen "reasonable government", they are unlikely to invest and create under "activist government".

Excellent work, bit of a tug, but worth the struggle. Not reachable enough for me to recommend to all, but if one is up for a bit of a worthwhile challenge, I have yet to see Niall disappoint.

Krugman's detour on 'Roadmap' to solvency - JSOnline

Krugman's detour on 'Roadmap' to solvency - JSOnline:

I think this past blog post on Krugman ought to have completely removed his credibility on deficits. To argue that smaller deficits are huge problem under W, then to turn around an argue that HUGE deficits are too small and no problem at all under BO is simply proof that he is either insane, or merely a pure partisan.

Ryan may be one of the best hopes for keeping this collapse to '70s levels vs 30's levels. His Roadmap ought to be the economic plank for returning the Republicans to control of congress. An excerpt:

"It reforms Medicare and Social Security so those in and near retirement (55 and older) will see no change in their benefits while preserving these programs for future generations of Americans. We do not have a choice on whether Medicare and Social Security will change from their current structure - the true debate is if and how these programs will be made solvent."

Senator Scum

McConnell scolds Franken for making faces from dais during his speech - TheHill.com

There is no excuse for Al Franken. "Civility" is going to require promotion beyond the grade school level.

BO's Father Served in WWII

But for what country? Certainly not the US ... his biological father was Kenyan and too young. BO was known as Barry Souetto (BS ... maybe more apt) up to early adulthood. Maybe that Philipine stepfather served? or maybe he is just fabricating like he usually does.

In any case ... BO doesn't know if his father served in WWII, Dan Quayle can't spell potato ... one is a big news story at the time, the other is nada.

Our media is unbiased.

Imagine a Lunatic

Op-Ed Columnist - The Lunatic’s Manual - NYTimes.com

Reading this column made me thing of John Lennon's "Imagine" ... "nothing to fight or die for". I strongly suspect that Herbert can't "imagine" anything worth that kind of commitment, thus the column.

The strange idea that war at any level is a "shared commitment" that requires the "sacrifice" of tax increases, while massive entitlements apparently are not, is especially curious. Historically, the situation is exactly the reverse -- WWII, which Herbert holds up as an example was of course paid for via a massive level of government debt.

Virtually nobody sees national defense as anything but a national priority of the highest order. If a couple major cities are smoking nuclear wastelands, considerations as to "infrastructure" and the latest entitlement will drop extremely far on the priority list of the sane.

In the "Herbert Universe", both Bush and BO are "lunatics", and I guess "somewhere out there" exists the level of sanity confidently declared by Bob Herbert.

One quote:

It’s time to bring the curtain down for good on these tragic, farcical wars. The fantasy of democracy blossoming at the point of a gun in Iraq and spreading blithely throughout the Middle East has been obliterated. And it’s hard to believe that anyone buys the notion that the U.S. can install a successful society in the medieval madness of Afghanistan.

So BO just declared that HIS ADMINSTRATION had brought the troops home and was "declaring victory". So is what is happening in Iraq a "fantasy that as been obliterated"? Once we "put the lunatics manual" aside, what do we see? The world as seen by Herbert?

Two Ways To Live Life

Op-Ed Columnist - The Summoned Self - NYTimes.com

First, I want to applaud Brooks for even travelling this ground, most folks seem happy to not even think about what they are up to for their four score and ten. Now to get snarky.

There are two kinds of people, those that divide groups into two groups, and those who don't ;-)

or my favorite, there are 10 kinds of people, those that understand binary and those who don't!

It is interesting to me that Brooks assigns Christensen, "the well planned life" and the "other" as the "summoned life". Supposedly, the person in the "summoned life" is always asking "what are my circumstances asking me to do?". Christensen is a Christian, part of what he does is ask God what his life is about. I'd argue that if one is determined to come up with two basic categories, the categories are life based on Transcendence (God, something bigger, philosophy, etc), or "Situational Ethics" ... what does it seem is the right thing for me to do today based on knowledge, experience, the environment, etc. So were I to label Brook's categories, they would be "Summoned" -- the God (or other transcendent) directed life, or "Situational" ... I'll make it up as I go along.

I'm not really a "two class" person ... I think "avoidance, distraction, ignorance and procrastination" are all more common categories for "how to live my life" than the ones that Brooks happened to pick out, but it is worth low cost of the quick skim anyway.

The Social Welfare Bubble?

RealClearPolitics - Not a State-Broken People

This is a rather long George Will speech that is well worth reading through. I SINCERELY hope that his thesis, borrowed from Orwell, that "we are not a state broken people" will hold true in November and beyond. Putting the likes of BO in the WH is taking a severe risk, I think it remains to be seen if this regime will allow itself to be slowed by the vote. 

I've been reading a number of books that dovetail with my view that we are in for a very extended "age of re-assessment" -- involving significant loss of wealth, lifestyle and our very liberties being very much in doubt in America. Like all Presidents, Bush was a dissappointment, especially in his 2nd term. Most people forget how difficult Reagan's 2nd term was -- Iran Contra may refresh the mind. What was very new is that this time, for the first two years of that term, Republicans were in charge of Congress, and had already fallen prey to that very real temptation to spend the current and future people's treasure, heavily contributed along with the painful drag of the two wars, to "the base" abandoning the Republican brand.

Republicans as a voting block forgot that in order to govern for the long run, many candidates that are far far less than perfect must be tolerated as the lesser of two evils. The idea that "we may as well have Democrats if they can't do any better than this", has now, very quickly been proven to be demonstratively false. The sad problem is that like the AM hangover compounded with very real damage done to your reputation, family, finances, or all of the above, bad decisions often have much longer term consequences.

In my opinion, we are seeing a series of very long term bubbles pop, and they will continue to pop ... home prices, markets, personal and public debt, the dollar ... an yes, "entitlements". For a century ... with peaks in the 30's, 60's and  now 10's, BOTH PARTIES (the W drug benefit is like 1/3 the size of BOcare) have engaged in an orgy of vote buying through entitlements that are largely to be paid (they thought) by "future generations".

Folks, welcome to the future! We have seen it, and it is impoverished! Thank you "Progressives"!

Anyway, I recommend the whole Will article. Here is just a little teaser on the "welfare bubble".

In 2007, per capita welfare state spending, adjusted for inflation, was 77 percent higher than it had been when Ronald Reagan was inaugurated 27 years earlier. The trend continues and the trend is ominous. Fifty-one days ago the president signed into law health care reform, that great lunge to complete the New Deal project and the Great Society, that great lunge to make us more European. At exactly the moment that this is done the European Ponzi scheme of the social welfare state is being revealed for what it is.

GOP Stupidity

RealClearPolitics - The Politics of GOP Stupidity

What we have here is a failure to communicate .... the fact that conservatives and liberals have a completely different model of government.

 EJ's model is that we OUGHT to "be like Europe". There isn't any "American Brand" -- the only way to solve problems is by more and more government, and any other approach is "stupid". EJ is so intelligent that he's cut that board three times and is shocked and dismayed to find that it is still too short -- when your only tool is your "saw" (government), there simply is no other way but to keep using your saw ... harder, deeper, faster, and for longer.

It used to be that America was PROUD to be different. We looked at things with a more optimistic and different approach, and it didn't involve changing the structure of our government:

Then there's the very structure of our government. Does any other democracy have a powerful legislative branch as undemocratic as the U.S. Senate?

When our republic was created, the population ratio between the largest and smallest state was 13-to-1. Now, it's 68-to-1. Because of the abuse of the filibuster, 41 senators representing less than 11 percent of the nation's population can, in principle, block action supported by 59 senators representing more than 89 percent of our population. And you wonder why it's so hard to get anything done in Washington?

Here the left has a stranglehold on Congress and the Presidency, but it is STILL not enough for them ... they want ABSOLUTE POWER!

EJ wants wealth redistributed at all costs -- if it costs jobs, fails to improve the budget or anything else, it is "inherently good". He sees a "Robin Hood model" as somehow "just", but that model assumes that the system fails to allocate income correctly, so somehow, "central command" has to REallocate it.

Frank Rich, Review of "The Promise"

‘Why Has He Fallen Short?’ | The New York Review of Books

I won't have time to read "The Promise", and it was tough to skim through this review. It is most interesting to note the liberal thought tenets:

• Liberals are smarter, BO is smartest of all, human intelligence is "the deal" -- forget spirit, emotion, intuition, etc ... liberals are smarter, liberal leaders are smartest of all, that is certain to be the answer to all our problems very soon.
  
• It all CAN be done by pulling on the right government levers -- once you have a smart enough rat pushing the levers, nirvana is at hand.
  
• "the masses", especially those that fall into the evil of conservatism, are too stupid to understand, or often even to be manipulated to the correct path. They fall prey to "ideologues", "partisans", religion, etc ... they lose the true and saving faith in the garden of liberal earthly delight, which the truly wise know is "just around the corner" (see that rat pushing those levers??? ....) 

There is always a certain happiness and passion to liberals when they are out of power -- their certainty that they have all the answers is so solid it defies any doubt when they are looking on from the sidelines, or quarterbacking on Monday morning. The only thing that stands between them and great joy is that damned "less than liberal" in power at the time.

Once they sit down to the daily task of pushing and pulling on those levers of power with Delphic brilliance, there is a certain panic, depression and confusion that descends upon them. "The damned conservatives have broken the machine too badly!!!" ... "This is FAR worse than we thought, we must re-double and triple our efforts to spend money, to regulate, to legislate, to pontificate, and to demonize !!!" ... "Why, oh why can we not find the right lever? The evil conservatives must have hidden it. Nirvana was right at hand, we could see it! But now there are all these damned problems!" ... their travails would be humorous if it wasn't the levers of power in a real nation, OUR NATION that they are randomly pushing, pulling and abusing with no clue of reality.

One often wonders how one can last past 30 as a liberal. It just seems like the real world would have bitten you in the ass by then and convinced you that "brains ain't everything". Brains are nice, but even Einstein is dead -- much better to try to branch out a bit.

Shoe Bomber Sentencing

snopes.com: Judge William Young -- Shoe Bomber Sentencing

Worth a read, got in the mail and had to verify it was true, thus the Snopes link. My big concern with the left today, is I'm not at all certain they still honour this  paragraph from the sentencing:

It seems to me you hate the one thing that to us is most precious. You
hate our freedom.  Our individual freedom.  Our individual freedom to
live as we choose, to come and go as we choose, to believe or not
believe as we individually choose.  Here, in this society, the very
wind carries freedom.  It carries it everywhere from sea to shining
sea.  It is because we prize individual freedom so much that you are
here in this beautiful courtroom, so that everyone can see, truly see,
that justice is administered fairly, individually, and discretely.  It
is for freedom's sake that your lawyers are striving so vigorously on
your behalf, have filed appeals, will go on in their representation of
you before other judges.

Wolfram TED

It is worth going out and playing with Wolfram Alpha, it is pretty amazing and I would be completely unsurprised if it replaced Google for some classes of knowledge work.

I have "A New Kind of Science" -- I'm really not going to say that I understand it, but kind of like at the end of the video, I believe one has to take a "Super Programmers View of the Universe" ... it is all about software, "models".

Physics is a mathematical model that accurately predicts much of the physical universe, but it has to some degree broken down at the levels of the very small, the very hot and the very fast.

Wolfram believes that he has a better idea, Cellular Automata, as a better way than existing forms of mathematics to explain "virtually everything" ... the structure of the universe, language, thought, evolution ....

There are pieces that I think I kind of get ... sort of like reading the classics, Greek and Roman History, and a few thousand other things, I'm hopeful that I can reduce demands on my time in the future to undertake getting a bit smarter about this area.

(In my dreams, I may even take on and somehow come to grips with Roger Penrose: "The Emperors New Mind" ... sort of like "A New Kind of Science", I've taken a couple of runs at that one and decided, "I need a bigger brain, or A LOT more time" .... I have this sneaking suspicion that while "in theory", even a mortal ought to be able to figure some of this stuff out by taking longer, drawing on more supporting material, creating intermediate analogous models, etc, there is a fairly high risk this is "Non-computable in MooseSpace".

I think it IS fascinating to watch however!

Tyranny of the Majority

Mass. Legislature approves plan to bypass Electoral College - Local News Updates - MetroDesk - The Boston Globe

There is a move afoot to make an end run around the electoral college that so many liberals hate. The idea that somehow politicians are going to pay more attention to "fly over country" is the big lie ... as is so often the case with liberal agendas, it is in fact exactly the OPPOSITE. TODAY you will see candidates stop in those states because the "value per voter" is much higher than voters in urban areas -- as the founders intended to help act as a brake on "the tyranny of the majority".

Presidential candidates now "ignore wide swaths of the country" they consider strong blue or red states and focus their campaigning on contested states, Eldridge said. If the president were picked by national popular vote, he argued, candidates would spread their attention out more evenly.

"That's really what we're talking about is making sure that every voter, no matter where they live, that they're being reached out to," he said.

What else can one say about this quote beyond "YES"!

"The thing about this that bothers me the most is it's so sneaky. This is the way that liberals do things a lot of times, very sneaky," he said. "This is sort of an end run around the Constitution."

Well, maybe one thing -- why is this so? It is so because liberals believe that the ends justify the means. If the 60 vote rule in the Senate has to be subverted so they can take over health care, so be it. If they have to use direct lies and sneak around the US Constitution, so be it. They believe that in the end, they can create "utopia" if they just get their way --- history tells us that their utopia is either bankruptcy, the gulag, or both. To which, they say "so be it".

Net Neutrality

Al Franken to Liberals: Don't Check Out Now - Political Hotsheet - CBS News

As a techie semi-libertarian, I've looked at Net Neutrality and pretty much said "who cares". In principle, "no barriers, little or no censorship, standards" seems just fine ... and as far as I can see, "we're there".

Now I see that Al Franken is really in favor of it and is certain that "Fox news is going to load faster than DailyKos",  and my antenna quiver.

My usual rule is that if liberals accuse conservatives of planning to do something, then they are planning (or in the process of) doing exactly that. (We could do a really long list, but think of campaign finance complaints against Bush and what BO did, think of deficits under Bush vs BO, think of complaints of Rove and the Christian right and then look at Axlerod and Acorn ...)

So why DOES everyone need to have exactly the same access? Is this some statement like "since there isn't much of a market for liberal talk radio" (since NPR, CBS, ABC, etc already cornered it), we ought to either cancel conservative talk radio or subsidize a liberal version?

Oh, and who enforces Net Neutrality? I'm assuming that Al Franken is saying "the government" -- so while I'm sure the DailyKos will load really speedily, maybe Fox News won't even be possible to find if Al gets his way. His "neutral" and mine may be significantly different.

Haven't changed my mind yet, but "if Franken is for it, I'm against it" is often a really good rule, and the fact that he is for it at least means it needs some real thought and scrutiny!

Journolist

Raw Journolist emails on ‘Palin’s Downs child’ | The Daily Caller - Breaking News, Opinion, Research, and Entertainment

Truth is often far stranger than fiction. While liberals are up in arms at the "unfairness" of the edited tape of Sherrod and how it "mislead" the poor NAACP and BO administration, the Journolist story just goes on and on, getting stranger and stranger.

Now they didn't happen to come out and call Fred Barnes a racist as they were discussing, but it makes one realize why they are always railing against the "vast right wing conspiracy" and "coordinated conservative attacks". They assume it must be true, because that is how THEY operate!

The difference is that if some "RightRlist" with a bunch of conservatives that contained a lot of hypothetical ideas of how to damage BO or some Democrat rights theft dejour, the MSM would go positively whack job nuts! Many of them already are over just an edited tape and the subsequent over reaction by their own beloved BO.

The thing that hits me the most is how completely out of touch they are with what something around 50% of Americans are like. We ALL know what liberals are like -- we see them on the news all the time, watch their movies, listen to their songs and get to hear them pontificating on the stupidity of religion, the nuclear family, people working to support themselves, monogamy, heterosexual lifestyles, having (and no doubt falling short of) moral standards, and all sorts of things "liberals" find to be abominations. There is nothing in the Journolist that I really find "surprising" -- it just provides extra clarity for "why they are as they are".

It isn't hard for a conservative to understand their thinking at all -- "there but for the grace of God". If I wasn't "saddled" with the belief in an immortal soul and eventual judgement, I would enjoy a whole lot more smugness and witty attacks of all sorts. It is very human to enjoy being "in with the in crowd", and Journolist is clearly that -- these are folks that KNOW of the rightness of their ways. No need to try to interpret the wishes of some infinite God or anything, just go with what seems like a fun approach to taking down the folks you hate --- forget "truth". Edit a tape where someone is talking to put them in a bad light? Why bother, just make up stories out of whole cloth -- that shows off a whole lot more of your "creativity".

The wages of complete fabrication is that it becomes the standard. BOTH SIDES will fall to this "standard", and when they do, the left will of course LOUDLY lament that the right has fallen to their standard.  The IDEA of standards and the CONSISTENT application of them to everyone indendent of "race, religion, color, creed" or even political party, is that everyone benefits from the civility and predictabilty. When once side goes "JournOList", it is only a matter of time before the other side does as well.,

And who will the REALLY be to blame then?

Standing Up To Right Wing

RealClearPolitics - Time to Stand Up to the Right Wing

Here is the "short version" of the Sherrod video.




Here is a video of the Black Panthers voter intimidation.




EJ Dionne is all up in arms here. I can remember staying up late to finally be able to see the entire Rodney King tape -- it was months after the incident that had caused the riots. It was LONG and BORING ... things go on for a very long time before the "hot incident" that caused LA Cops to be branded as "racist", even though a number of those involved were black. Let's face it, once those snippets were shown, it was over, the MSM was completely not concerned with "context".

One could go on a long list of folks that have been smeared in the MSM over all sorts of things, or nothing at all -- Robert Bork, Pat Buchanan, Dan Quayle, Ray Donovan ("where do I go to get my reputation back"), Clarence Thomas, ... I'm not going to waste time here, it is common. We now know of "JournOlist" with the discussion of just calling Fred Barnes a racist made up out of whole cloth to take attention away from the Rev Wright story. They didn't happen to do that one, but how many DID they do?

Take the very simple thought exercise of making Sherrod a white guy government worker talking at some "organization for the advancement of white people" -- I don't care how long he talks, he is toast, and NOBODY comes out to defend him. 

Put some white hoods in the place of the panthers and have them saying the inverse of "cracker" at some polling station -- I bet the results are WAY different, and that the story doesn't go away.

The OTHER thing I'd ask be considered -- put the "conservative version of EJ" in the story in the other cases. The other stories are as I indicate above, NOW, have a conservative journalist come out saying "it is time to stand up to the LEFT wing!". How is that received? I bet it is received as "White politicians in government making questionable statements about blacks, and white racial organizations (if there were such a thing) cheering them on is not "partisan" it is "american"... it is something that all should be able to agree on".

Think about it. The fact that EJ can do an article like this with impunity says that the heading is very wrong. It is time for AMERICANS to stand up to the wacko liberal press!!!