DiLorenzo Dishes It Out To Subcommittee On Domestic Monetary Policy

Business, Debt, Economy, Federal Reserve Bank, Healthcare, Individual Rights, Inflation

Pearls before swine? Probably. Still, the freedom movement is gaining momentum. First came Randy Barnett’s powerful testimony before the Senate Judiciary Committee (read “Turning Citizens Into Subjects: Why The Health Insurance Mandate Is Unconstitutional”). My good friend Thomas DiLorenzo, Professor of Economics at Loyola University in Maryland, followed. Tom tried to explain to members of the Committee on Financial Services (Subcommittee on Domestic Monetary Policy and Technology) that the “Fed’s monetary policies tend to create temporary and unsustainable increases in employment while being the very engine of recession and depression that creates a much greater degree of job destruction and unemployment.”

Here’s an excerpt from “How the Fed Fuels Unemployment”:

When the Fed expands the money supply excessively it not only is prone to creating price inflation, but it also sows the seeds of recession or depression by artificially lowering interest rates, which can ignite a false or unsustainable “boom” period. Lower interest rates induce people to consume more and save less. But increased savings and the subsequent business investment that it finances is what fuels economic growth and job creation.
Lowered interest rates and wider availability of credit caused by the Fed’s expansionary monetary policy causes businesses to invest more in (mostly long-term) capital projects (primarily real estate in the latest boom-and-bust cycle), and there is an accompanying expansion of employment in those industries. But since the lower interest rates are caused by the Fed’s expansion of the money supply and not an increase in savings by the public (i.e., by the free market), businesses that have invested in long-term capital projects eventually discover that there is not enough consumer demand to justify their investments. (The reduced savings in the past means consumer demand is weaker in the future). This is when the “bust” occurs.
The economic damage done by the boom-and-bust policies of the Fed occur in the boom period when resources are misallocated in the ways described here. The “bust” period is actually a necessary cure for the economic miscalculations that have occurred, as businesses liquidate their unsound investments and begin to make decisions on realistic, market-based interest rates. Prices and wages must return to reality as well.
Government policies that bail out businesses that have made these bad investment decisions will only delay or prohibit economic recovery while encouraging more of such behavior in the future (the “moral hazard problem”). This is how short recessions can be turned into seemingly endless ones. Worse yet is for the Fed to create even more monetary inflation, rather than allowing the necessary economic adjustments to take place, which will eventually set off another boom-and-bust cycle.

MORE.

Prominent Neoconservative Admits Europeans Ahead On Multiculturalism

Affirmative Action, Europe, IMMIGRATION, Islam, Multiculturalism, Nationhood, Neoconservatism, Racism, Republicans

Which is what I said back in … 2005, in the column titled “Get With The Global Program, Gaul”. At the time, the famed Francis Fukuyama, Frederick Kempe, and Jonah Goldberg—neoconservatives all—had fingered the French for racism and snobbery in marginalizing their Muslims, who were running riot across France. All nonsense on stilts, naturally. The French simply rejected what we Americans embrace: submerging aspects of their identity for their mad-as-hell Maghrebis. As I wrote then:

“To her credit, France has no institutionalized multiculturalism. Integrating individuals, not communities, is how the French have approached their émigré population. They say their republican values proscribe affirmative action. But since America’s republican values haven’t hindered racist quotas here, says our neoconservative troika, the French should get with The Program.”

“Schadenfreude tinged with a sense of American superiority,” is how I characterized this neoconservatives response to the destruction Muslims visited across France. Their recommendations for the errant Europeans? Perfect yourselves by following us Americans; through affirmative action programs; through fashioning a spanking new national identity; do some “nationl building.”

Now, Dr. Daniel Pipes admits to finding the European anti-Islamist stance encouraging. Those of us who have family in Europe are well-aware that this position is widely shared by Europeans. In the Netherlands, for example, they vote in large numbers for Geert Wilders, an influential Dutch parliamentarian working against the spread of Islam in his country, and roundly condemned by most on the American “right” as a fascist.

Dr. Pipes’ is a welcome conversion, although he is simply lauding politicians for catching up with the people they are supposed the represent. Writes Dr. Pipes:

The stirring speech by British prime minister David Cameron on Feb. 5, in which he intelligently focused on what he called the “hands-off tolerance” of “Islamist extremism,” including its non-violent forms, exactly fits this pattern.
In similar fashion, Chancellor Angela Merkel of Germany last October deemed multiculturalism to have “utterly failed.” A referendum in Switzerland about minarets manifested the concerns of that country’s population – and polling around the continent showed those sentiments to be widely shared.
The rise of respectable political parties primarily focused on the issues surrounding Islam – with Geert Wilders’ Party for Freedom (PVV) in the Netherlands at the forefront – is perhaps the single most encouraging sign, compelling legacy parties like the British Conservatives to pay attention.

Obama’s Hate-Your-Boss Hotline

Barack Obama, Business, Economy, Individual Rights, Liberty, Regulation

“Get in the game,” the president instructed U.S. business leaders, in an address to the U.S. Chamber of Commerce today. As Bloomberg.com reported, this audacious president urged business to “support their country by moving cash from the sidelines into the economy,” “hiring more American workers,” and, generally “investing in this nation.” This, as Obama carves greater and greater sections out of the hide of American businesses for the assorted, unproductive oink sectors.

Just the other day, this deeply silly man “launched a new program at the Department of Labor which will refer workers who have complaints about their bosses to a toll free number at the American Bar Association, where they can get a lawyer to work on their case on a contingency fee basis.” (Via Elizabeth MacDonald of Fox Business) Yes, litigation always reduces the costs of doing business, doesn’t it?! What’s not to like in a collaboration between “the federal government and private bar” to promote “worker rights,” already covered by the Occupational Safety and Health Administration (OSHA) and other legislation. This is how Obama is “doing his part to improve the business climate” in this country.

The meek reply to BHO’s demands from Johanna Schneider, “who directs external relations for the Business Roundtable,” will not do. “Jobs will follow demand,” she said. “Unless you see sustained demand for your product or your service, you cannot from a fiduciary standpoint invest in more employees.”

Business leaders will have to learn to speak the language of individual/natural rights, and link the rights of property and freedom of association to prosperity and peace. Unless they sound morally indignant about the violation of their rights, parasitical collectivists such as BHO will continue to make light of and mock the “incredible pressure to cut costs and keep margins up,” as the Idiot-in-Chief put it.

Assassinations Under US Auspices?

Constitution, Criminal Injustice, Foreign Policy, Intelligence, Iraq, Journalism, Justice, Law, Media, Middle East

I hope the failed assassination attempt on Omar Suleiman, Egypt’s vice president, recently appointed to quell the unrest in that country, is not a harbinger of things to come. I am thinking of the vulgar cellphone images that circulated the Internet, in which a stoic Saddam Hussein, noose about his neck, is heckled by a hooded Shiite executioner. Even more repugnant than the hasty hanging carried out under US auspices were the US-sponsored legal proceedings that preceded it. (All the obligatory denunciations of Hussein obtain here, naturally. Bad man. Bad man. Bad man.) That Tribunal, which was branded “made-in-America,” had more in common with the French Revolutionary Assembly (See “No Due Process For A Despot”).

Similarly, such a barbaric specter in Egypt (conjuring the French, and not the American, Revolution), will have been greatly inspired, like in Iraq, by American media screeches.

I worry because the US is not necessarily averse to hasty hangings, considering that the strongmen we betray may turn around and tell all: You know; the stuff about how they helped the U.S. with its rendition and torture programs.