Category Archives: Debt

Schiff's Sad, Sound, Song

Debt, Federal Reserve Bank, Inflation, Political Economy

The only thing you want to take away from this condescending Time magazine “piece” about libertarian financial analyst Peter Schiff’s prognostications is this:

“over longer periods, Schiff’s decade-old strategy of steering clients out of U.S. securities and into commodities and overseas stocks has been a big winner. His investment record surely can’t be the reason for his fall from media grace.”

Much to the consternation of the Times “writer,” the reason Schiff “hasn’t changed his tune” on the imperative of escaping the phony US economy is because the tune is in the right key!.

Justin Fox’s column is so pointless, so full of non sequiturs. This guys doesn’t even attempt to make sense, and I imagine he gets a bundle for the epistolary offal he produces.

I mean, on the one hand, Fox concedes that Schiff’s investments have proven prudent. But on the other hand, he insists that Schiff got to bask only briefly “in the glory of his spectacular call,” because he has fallen out of grace with the menagerie of morons on mainstream media.

As though you “bask in the glory of [your] spectacular call” only so long as you’re invited on the Keynesian “Kudlow and Cretins” show. Perhaps saving your clients a bundle and safeguarding your own assets is enough to make an honest man “bask.”

Updated: Arnold Issuing IOUs

Classical Liberalism, Debt, Economy, Federalism, Government, Inflation, Political Economy, Republicans, The State

For a long time, “moderate” Republicans considered California governor Arnold Schwarzenegger a member of the “saner” Republican guard. Arnold drove his state to insolvency, and insolvency, you see, can shore up a moderate’s credentials.

Schwarzenegger has pumped up his state’s bloated bureaucracy and ballooning parasitical class. Now, in a referendum, California voters have rejected milquetoast measures that would allow The Terminator to continue to hobble along with his $21 billion deficit.

The Republican governor made sure he was out of town during the vote. “He was not the public face of the effort,” reports the New York Times. But rather, Arnold “let teachers and firefighters do his talking for him in advertisements, and indeed was not even in the state the day of the vote.”

“Representative democracy,” wrote Ludwig von Mises in Bureaucracy, “cannot subsist if a great part of the voters are on the government pay roll. If the members of parliament no longer consider themselves mandatories of the taxpayers but deputies of those receiving salaries, wages, subsidies, doles, and other benefits from the treasury, democracy is done for.”

One of the causes of inflation and debt is the public sector—with its capacity to hire while the public sector must fire—and award its members with inflated wages and benefits, the kind we can only dream of.

Update (May 20): Arnold gave it a bash; he tried to peddle a “package of budget-balancing measures that he promised would temporarily fix the state’s financial crisis.”

MSNBC: “Schwarzenegger said the state’s residents have had to sell off motorcycles, second cars and hold garage sales to make ends meet in recent months. Now, they’re telling state officials that the government has to shrink, too.

“Don’t come to us for extra help. That was the message.”

Me: Moocher-in-chief, however, knows how to try and prolong the party, with some leverage against the moochers he governs:

“Still, Schwarzenegger said the budget cuts to come may be more painful than California voters realize. While they may not want to pay more for services, they can’t say specifically which services they would pare, he said.

He said cuts will certainly come in education, health care and in prisons by transferring undocumented immigrants to federal facilities and transferring more non-violent offenders to local jails. He plans to meet with state lawmakers in the afternoon to discuss the state’s options.”

Dazed And Confused

Debt, Economy, Federal Reserve Bank, Media, Socialism

Glenn Beck “interviewed” these two Keynesian clowns, without so much as challenging them. Beck wanted to badly, but lacked the intellectual tools to counter their revival of Keynes’s anodyne “Animal Spirits” concept.

Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism, By George A. Akerlof and Robert J. Shiller, is being studied and followed by Obama.

As is my habit, I preempted this issue some time ago in “Voodoo Child Talks Up A Storm”:

“The Economist’s A-Z of Economics quotes Keynes’ convoluted explanation of the concept of ‘animal spirits.’ I won’t; like his theorizing, Keynes’ writing is incoherent. (See for yourself.) So too is ‘Economics A-Z’ perplexed by Keynes’ whimsy: ‘Where these animal spirits come from is something of a mystery. Certainly, attempts by politicians and others to talk up confidence by making optimistic noises about economic prospects have rarely done much good.'”

“Because consumption is its be-all and end-all, consumer confidence is crucial to the Cult of Keynes. If the consumer is not crazy confident—even when he ought not to be—goes the ‘thinking,’ he’ll quit consuming until he drops. In short, our economic animists are hoping that the holy spirit of ‘confidence’ will enter the once bitten, twice shy lender, and make him lend. The same spell is supposed to mysteriously move the unemployed and penniless to spend.

I sincerely hope not.”

Had Glenn read the column, he might have had a bit of an angle. Is it my imagination, or is “Good Guy Glenn” becoming a lot like O’Reilly: guest are welcomed on so that he can talk at them/bounce his “ideas” off them, as they smile, nod and say stuff like, “Good question/you raise an important point.”

Update IV: Cooking The Books To Make Cuba-Care Come True

Debt, Economy, Elections 2008, Fascism, Healthcare, Individual Rights, Objectivism, Politics, Propaganda, Republicans, Socialism

To listen to the reports by the malpracticing media, health care lobbyists have volunteered, for the good of all, to pay for a large portion of the so-called health care reforms: “Representatives from hospitals, the insurance industry, medical device and pharmaceutical companies, labor and physicians came to the White House to discuss major steps being taken to lower health care costs across the board” by $2 trillion.

That’s the narrative coming from the White House and the cretinous press corp.

Yep, that’s how the “market” works: the president sweet talks “stakeholders” in an industry, and, before you know it, they’re cutting costs and improving delivery. And Meghan McCain will grow a brain.

“A good rule in politics,” explains Cato’s Michael Cannon, “is that if something sounds too good to be true, it usually is. Lobbyists don’t simply propose to reduce their members’ incomes. If they did, they would be fired and replaced with different lobbyists.”

“According to the Urban Institute, covering the uninsured would cost a minimum of $120 billion per year. Over 10 years, the cost could easily hit $2 trillion.That money’s gotta come from somewhere. And that’s where politics comes in. Everybody wants that money to come from someone else.” …

“Another possibility is that the industry – which would get more customers under universal coverage – wants to help the president and Congress ignore the math.”

“Democrats have offered reforms that they claim would reduce health care spending over time, including more coordinated care, preventive care, and disease management. The industry endorsed those reforms in its recent letter to President Obama. But the number-crunchers at the Congressional Budget Office say there’s little to no evidence that those measures will produce savings. And unless the CBO agrees, Congress has to cut payments or raise taxes.”

“Senate Finance Committee chairman has spoken openly about getting the CBO to change its mind. If reformers can say that even the industry is committed to achieving savings with these reforms, that might make it easier to get the CBO to relent, and allow health care reform to pass without the necessary payment cuts or tax increases – even if there’s still no evidence that the assumed savings will appear.”

Cannon, director of health policy studies at the Cato Institute, doesn’t call it “cooking the books”; he calls it “the new math of universal coverage.”

Update I: Myron, last I checked, procuring private care in Canada was against the law. Socialized medicine—more often than not analyzed only from a utilitarian point of view—is coercion and tyranny that criminalize consensual, naturally licit contracts. If Obama is indeed building-up to Cuba-cum-Canada care by increments, it’ll end in coercion of the worst kind. Canada, North Korea and Cuba do not have second-tier medicine.

Update II (May 12): My man Myron again: In Canada, politicians jump the queue or hop over to the US. The rich and powerful are seldom without. Obama may be an operational centrist, but he’s all about heavy-duty planning. The guy can’t conceive of anything but a planned economy.

As bad as the Democrats are, let us not forget the quintessential con men and women: the Republicans. They’ve just about to compromise on a credit-card bill of rights. As you know, the right to carry debt with no penalty is enshrined in the Constitution.

Yaron Brook of the Ayn Rand Institute details the Republicans’ contribution to socializing American health care:

“[A]lthough they claim to oppose the expansion of government interference in medicine, Republicans don’t, in fact, have a good track record of fighting it.

Indeed, Republicans have been responsible for major expansions of government health care programs: As governor of Massachusetts, Mitt Romney oversaw the enactment of the nation’s first ‘universal coverage’ plan, initially estimated at $1.5 billion per year but already overrunning cost projections. Arnold Schwarzenegger, who pledged not to raise any new taxes, has just pushed through his own ‘universal coverage’ measure, projected to cost Californians more than $14 billion. And President Bush’s colossal prescription drug entitlement–expected to cost taxpayers more than $1.2 trillion over the next decade–was the largest expansion of government control over health care in 40 years.”

“The solution to this ongoing crisis,” writes Brook, “is to recognize that the very idea of a ‘right’ to health care is a perversion. There can be no such thing as a ‘right’ to products or services created by the effort of others, and this most definitely includes medical products and services. Rights, as our founding fathers conceived them, are not claims to economic goods, but freedoms of action.

You are free to see a doctor and pay him for his services–no one may forcibly prevent you from doing so. But you do not have a ‘right’ to force the doctor to treat you without charge or to force others to pay for your treatment. The rights of some cannot require the coercion and sacrifice of others.

So long as Republicans fail to challenge the concept of a ‘right’ to health care, their appeals to ‘market-based’ solutions are worse than empty words. They will continue to abet the Democrats’ expansion of government interference in medicine, right up to the dead end of a completely socialized system.

By contrast, the rejection of the entitlement mentality in favor of a proper conception of rights would provide the moral basis for real and lasting solutions to our health care problems…”

[SNIP]

The Republicans—who, as I’ve joked quite seriously, need a giant tin-foil hat; not a bigger tent—have never made an argument from rights. I doubt they know what a negative individual right is.

With the exception of Meghaaan McCain and Carrie Prejean, of course.

Update III (May 13): LEONARD PEIKOFF is still the best at battling the enslavement of doctors.

Update IV (May 14): A correction to the low-ball guesstimates hereunder as to the amount of debt carried by each American: “Every American is now burdened, most of them unknowingly, with $184,000 in federal liabilities and unfunded government promises.”