Economics

[TrueLight]

Ron Paul: Obama Is Another Corporatist, Not a Socialist
By Steven Yates 13/4/10

"The idea that President Barack Obama is a socialist is popular among many conservatives; all of us have seen automobiles sporting the bumper sticker reading, Don’t Blame Me; I Didn’t Vote For the Socialist — obviously referring to Obama. Not so fast, says, of all people, Ron Paul (R-Texas).

Addressing the Southern Republican Leadership Conference during its third day, Dr. Paul told the audience, “The question has been raised about whether or not our president is a socialist….  I am sure there are some people here who believe it. But in the technical sense, in the economic definition of a what a socialist is, no, he's not a socialist.”

Dr. Paul continued, “He's a corporatist. And unfortunately we have corporatists inside the Republican party and that means you take care of corporations and corporations take over and run the country.”

What he means, and whether or not he is right, depends on what we mean by socialism and what by corporatism. In its classical usages (classical here meaning within classical Marxist usage and its derivatives) socialism means: an economic system that is abolishing or has abolished the private ownership of the means of production in favor of public (i.e., state) ownership, with all wealth shared.

In this classical sense, Obama is clearly not a socialist. Nothing he has done, not even in the recent healthcare bill, seems aimed at abolishing private ownership of the means of production.

Much of what he has done since taking office, however, has vastly increased government control over the means of production — e.g., when he personally demands that a CEO step down (think General Motors). Is this what we mean by corporatism? Ron Paul described the healthcare bill as containing many corporatist provisions:  “We see [corporatism] in the financial institutions, we see it in the military-industrial complex. And now we see it in the medical-industrial complex.”

Corporatism is often seen as monopolistic capitalism in which business and governmental elites partner with each other. This isn't too far from the mark. Business elites possess what we might call the power of the purse — they have the money. Governmental elites possess what we might call the power of the sword — they write the rules. We might debate which one, if either, is truly dominant since both scratch each other’s backs and benefit handsomely from having thwarted both genuine marketplace competition and a truly open political and electoral process.

Corporatism hardly began with the current administration, of course, or its predecessor. In an article published in 2002, which deserves far more attention than it has ever received, commentator Robert Locke outlined the basic ideas behind corporatism and traced some of its history and influence.

According to Locke, corporatism “has the outward form of capitalism in that it preserves private ownership and private management, but with a crucial difference: as under socialism, government guarantees the flow of material goods, which under true capitalism it does not.” (Emphasis in original.) Corporatism does not really trust the marketplace to provide. It manipulates the marketplace “to deliver goods to political constituencies [which now include] basically everyone from economic elites to ordinary consumers.”

What has made corporatism so tempting is thus not hard to see. Locke explains further:

Big business, whatever its casuists at the Wall Street Journal editorial page may pretend, likes big government, except when big government gets greedy and tries to renegotiate the division of spoils. Although big business was an historic adversary of the introduction of the corporatist state, it eventually found common ground with it. The first thing big business has in common with big government is managerialism. The technocratic manager, who deals in impersonal mass aggregates, organizes through bureaucracy, and rules through expertise without assuming personal responsibility, is common to both. The second thing big business likes about big government is that it has a competitive advantage over small business in doing business with it and negotiating favors. Big government, in turn, likes big business because it is manageable; it does what it is told. It is much easier to impose affirmative action or racial sensitivity training on AT&T than on 50,000 corner stores. This is why big business has become a key enforcer of political correctness.

Locke traces the history of corporatism to the idea that the marketplace is not really self-regulating, since the "big boys" will not "play fair"; hence economic activity requires outside management, be it through regulation, subsidy, or control over the monetary system. The first major corporatist enterprise of the 20th century was none other than the Federal Reserve, a private corporation that is embedded within the federal government — as its own literature states, “independent within the government.”

Then, in the 1930s, the (Fed-caused) Great Depression further eroded confidence in the marketplace to deliver material goods without government intervention. That period gave us Social Security and Medicare: the beginnings of the intergeneration redistribution of wealth we have been stuck with ever since. As political constituencies both large and small have grown, the corporatist edifice has grown along with them, often with the full support of the mainstream voting public both liberal and conservative.

The Left likes corporatism for three reasons, says Locke: (1) it satisfies government’s (i.e., politicians’) lust for power; (2) its machinery makes redistribution of wealth to favored constituencies possible; and (3) it enables politicians to accomplish this while remaining personally affluent.

The Right likes corporatism for three different reasons, says Locke: (1) big business can achieve enormous profits, capitalist-style, while unloading some of the cost and risk onto government; (2) the merger of business and government enables those at the helm of big business to influence government in ways favorable to themselves (e.g., thwarting true competition, which big business has seen as a nuisance since John D. Rockefeller, Sr. was heard to pronounce competition a “sin”); and (3) this merger seems able to minimize or dissipate whatever social unrest its policies create in the masses.

Locke provides several examples of corporatist endeavors besides the Federal Reserve. Some are even more obvious in today’s post-bailout climate: Fannie Mae, Freddie Mac, the insurance industry generally (especially evident given Obama/Pelosi-care!), real estate, federal financing of scientific research, agricultural price-supports, and many others; we would probably want to add to our list so-called "free trade" agreements (e.g., NAFTA, CAFTA, etc.).

The point to all this is that if we going to criticize the Obama administration’s economic policies, we need to be sure we have its economics right — and if we are paying attention, we see far more continuity with past administrations than we do change. There have been no fundamental changes, despite candidate-Obama’s mantra about “change you can believe in.”  (For this reason, many on the Left have grown as uneasy with this administration as any Tea Partier, even if for different reasons.)

Isn’t corporatism just a form of fascism? Yes and no. The most famous quote attributed to Italy’s Mussolini (the quote appears to be apocryphal) is that “fascism should more properly be called corporatism because it is the merger of state and corporate power.” Under fascism, unlike socialism, government did not assume ownership over corporations but controlled them, allowing nominal ownership. I would submit that if there is a difference, it is that in the English-speaking world more of a partnership between the two has emerged, and over a longer period of time — perhaps born of the quiet realization that many in the upper echelons of the corporate domain are as interested in power as any statist authoritarian has ever been, and that the two can achieve far more working together than they can separately. Working separately will, in fact, ensure that the two will butt heads more often than not.

Corporatism may be thought of as “soft fascism,” which is oligarchic but not totalitarian. Part of its genius has been to win acceptance from the voting public through (1) having created a mass and organizing it into groups, or political constituencies; (2) delivering goods to those constituencies; (3) all the while creating a sense of security for them if they play ball; and (4) (although the idea calls for a separate article) corporatism has sponsored “public schools,” further encouraging its acceptance through consistent ratcheting down of education not just about our founding principles but absent clear thinking about economics and even personal finance, while ratcheting up the current mixture of pop culture and job skills training (e.g., school-to-work, no-child-left-behind, etc.). The vast majority of teenagers educated this way will not question the system; the few who do can be safely marginalized.

Ron Paul has been the one Republican operating clearly outside the corporatist mindset. This might help explain why he and his supporters have been marginalized within the Republican Party, the mainstream of which serves corporatist interests. There are probably Democrats who are not corporatists. Dennis Kucinich might be an example.

All of which brings us to the question: If corporatism really is the best name for the economic system currently throttling America, can it be fought — and perhaps undermined? Of course, we have to identify it first. Most people have never heard the term. Then we might argue that corporatism is, in the long run, unsustainable: Social Security and Medicare, those two 1930s corporatist standbys, are both technically broke and on the federal equivalent of life support. As Baby Boomers retire, the situation will grow progressively worse! It was not without reason that Keynes said, "In the long run, we are all dead." Corporatism incorporates Keynesian economics and encourages massive spending by both government and consumers as the key to rising prosperity without looking far into the future. When people will not spend, generally because they cannot spend, there is an incentive to get money into their pockets; otherwise the economy falls into crisis. Spending money one does not have creates debt. The temptation is to monetize government debt. The result is the slow erosion of our dollars' purchasing power. The dollar in fact has lost 10 percent of its value in just the past year. Massive and still-growing indebtedness has the potential to be our downfall and the downfall of corporatism.

These considerations are all imminently rational, but the corporatist edifice we now live under has been built up under such a long period of time  — several generations, in fact — that dismantling it all at once would precipitate chaos. Moreover, the public is now accustomed to it. They fear the loss of their safety nets, and might argue reasonably that they spent their lives paying into Social Security and are now entitled to benefit from it. Healthcare costs are indeed astronomical; moreover, without Medicare (or some type of government aid), they would be priced beyond the reach of many elderly people. These are the main reasons Social Security and Medicare are politically untouchable, and that any politician proposing to abolish them would be rejected immediately by the majority of voters except for libertarians.

This issue is much larger than Obama. One way or another, he'll be gone in a few years. The problems will remain, and would have worsened even if McCain had been elected in 2008. How do we “turn back the clock”? Can we?

Robert Locke offers these troubling thoughts:

With these two different kinds of trust [in the self-regulating nature of the marketplace, and its ability to deliver material goods] gone, corporatism becomes not only worthwhile, but necessary. Crucially, it becomes psychologically necessary, independently of whether government can deliver on its promises, because people instinctively turn to government as their protector.

Anyone who is serious about getting rid of corporatism must explain how they are going to restore these two kinds of trust or persuade people to live without them. In particular, it is almost certainly useless, as verified by the fact that government has grown under every postwar Republican administration, to try to nibble away at big government without renegotiating the social contract that underlies it. If we don't have a plan to renegotiate this social contract, we must face the fact that the electorate will demand that it be respected."

Steven Yates
http://www.thenewamerican.com/index.php/economy/commentary-mainmenu-43/3303-ron-paul-obama-is-another-corporatist-not-a-socialist

[TrueLight]

Ron Paul - Greece Is Just The Beginning 6/5/10
http://www.youtube.com/watch?v=74z8i4kiCp8
Peter Schiff discusses Greece Riots and Bailouts 5/5/10
http://www.youtube.com/watch?v=bLfYU2XGX34
Marc Faber On Bloomberg: Governments are All Bankrupt 6/5/10
http://www.youtube.com/watch?v=KGU-2DSZiYY
Dr Berninger-Rumors on currency reform and the upcoming crash 3/5/10
http://www.youtube.com/watch?v=3mxJFCbm7vk
Jim Rogers on Bloomberg: Stock Market Plunge is "Normal Correction" 6/5/10
http://www.youtube.com/watch?v=tJa0pv7DPew

Peter Schiff on The european bailout-American Style
http://www.youtube.com/watch?v=tShimkhonYI
Ron Paul on the audit the fed bill, on the us dollar and the coming currency crisis 
http://www.youtube.com/watch?v=-MIKpMeDVRU

[TrueLight]

The Politics of Political Economists
By Murray Rothbard
Published 05/12/10

"In the course of his interesting discussion of "The Politics of Political Economists," Professor Stigler challenges the alleged view of Professor Mises that "economic statistics, or more generally quantitative economics -- generates a radical political viewpoint."[1] Stigler asserts that the empirical student acquires a "real feeling" for the functioning of an economic system, and "has had the complexities of the economy burned into his soul." Without going into the question of Mises's precise viewpoint on this issue, I think it important to note that Stigler has overlooked several fundamental considerations.

In the first place, statistics are desperately needed for any sort of government planning of the economic system. In a free-market economy, the individual business firm has little or no need of statistics. It need only know its prices and costs. Costs are largely discovered internally within the firm and are not the general data of the economy which we usually refer to as "statistics."

The "automatic" market, then, requires virtually no gathering of statistics; government intervention, on the other hand, whether piecemeal or fully socialist, could do literally nothing without extensive ingathering of masses of statistics. Statistics are the bureaucrat's only form of economic knowledge, replacing the intuitive, "qualitative" knowledge of the entrepreneur, guided only by the quantitative profit-and-loss test.[2] Accordingly, the drive for government intervention, and the drive for more statistics, have gone hand-in-hand.[3]

The enormous expansion of governmental activity in the gathering and disseminating of statistics in the last 25 years is surely more than coincidentally related to the similar expansion of the role of government in regulating and manipulating the economy. One of the leading authorities on the growth of government expenditures has put it this way:

'Advance in economic science and statistics improved our knowledge of interstate and intrastate differences in needs and capacities and may have helped stimulate the system of state and federal grants-in-aid. It strengthened belief in the possibilities of dealing with social problems by collective action. It made for increase in the statistical and other fact-finding activities of government.[4]'

We need not detail here the extensive use that has been made of national-income and gross-national-product statistics, as well as other statistical measures, in the attempts of the federal government at combating business cycles or unemployment.

Nor is this just a contemporary story. An authoritative work on British government puts the case thus:

'the minor role of government during the nineteenth century reflects more than the absence of violent economic disruption; it also reflects the infancy of the economic and social sciences. Compared with recent decades, the volume of systematic information about social conditions was very small, which meant that the existence of problems was hard to establish persuasively. . . . If the volume of unemployment is unknown, the gravity of the problem is in doubt.

The accumulation of factual information about social conditions and the development of economics and the social sciences increased the pressure for government intervention.. . .  Surveys like Charles Booth's Life and Labor of the People in London revealed conditions which shocked public opinion in the late eighties and nineties. As statistics improved and students of social conditions multiplied, the continued existence of such conditions was kept before the public. Increasing knowledge of them aroused influential circles and furnished working class movements with factual weapons.[5]'

Surely the role of the Fabian Society's industrious empirical studies in furthering the cause of socialism in Great Britain is too well-known to need stressing here.

On the continent and in America in the late 19th century, it is well-known that the rebels against laissez-faire and the classical political economy stressed their replacement with induction from economic history and statistics. That was the goal of the German Historical School and its Verein für Sozialpolitik, and of the young, German-trained exponents of the "new political economy" of government intervention in the 1870s and 1880s.[6] One of their leaders, Richard T. Ely, who called the new approach the "look and see" method, made it clear that the aim of fact gathering was to "mold the forces at work in society and to improve existing conditions"; they believed that as economists they had a responsibility for "shaping the character of the national economy."[7]

And let us not overlook the eminent interventionist sociologist Lester Frank Ward, whose proposed "scientific," "positive," planned economy, would consist of "social engineering" based on statistical information fed from all parts of the country into a central bureau of statistics.[8]

Nor was it only abstract speculators who expressed such views. Statisticians themselves participated in this movement. As early as 1863, Samuel B. Ruggles, American delegate to the International Statistical Congress in Berlin, declared that "statistics are the very eyes of the statesman, enabling him to survey and scan with clear and comprehensive vision the whole structure and economy of the body politic." One of the founders of the Verein für Sozialpolitik was the famous statistician Ernst Engel, head of the Royal Statistical Bureau of Prussia.[9]

And Carrol D. Wright, one of the early commissioners of labor in the United States and a man greatly influenced by Engel, urged the collection of statistics of unemployment because he wanted to find a remedy (presumably via government action). Wright hailed the new German school as including men of all lands "who seek by legitimate means, and without revolution, the amelioration of unfortunate industrial and social relations." Henry Carter Adams, a student of Engel's, who established the Statistical Bureau of the Interstate Commerce Commission, believed that "ever-increasing statistical activity by the government was essential not only for the sake of controlling naturally monopolistic industries, but also for the efficient functioning of competition wherever possible."[10] And certainly one of the great spurs toward constructing index numbers of wholesale and other prices was the desire to have government stabilize the price level.[11]

Unquestionably one of the prime founders of modern statistical inquiry in economics was Wesley C. Mitchell. There is no doubt that Mitchell aspired to lay the basis for "scientific" government planning. Thus:

'[Quoting from Mitchell] "clearly the type of social invention most needed today is one that offers definite techniques through which the social system can be controlled and operated to the optimum advantage of its members." To this end he [Mitchell] constantly sought to extend, improve, and refine the gathering and compilation of data.. . .  Mitchell believed that business-cycle analysis . . .  might indicate the means to the achievement of orderly social control of business activity.[12]'

And:

'he [Mitchell] envisaged the great contribution that government could make to the understanding of economic and social problems if the statistical data gathered independently by various Federal agencies were systematized and planned so that the interrelationships among them could be studied. The idea of developing social statistics, not merely as a record but as a basis for planning, emerged early in his own work.[13]'

The federal government's own account of the growth of its statistical agencies differs little from the above examples. The Bureau of the Budget, during President Eisenhower's not rabidly socialistic administration, explained the continued growth of federal statistics as follows:

'National growth and prosperity demanded an enlightened conduct of public affairs with the aid of factual information. The ultimate responsibility of the Federal Government for underwriting the health of the national economy has always been implicit in the American system.[14]'

Then, speaking of the New Deal era after 1933, the bureau added:

'A realization grew in the Congress and in high administration circles that sound and positive proposals to combat the depression required analysis based upon reliable information. As a result . . .  statistical expansion was resumed at an accelerated pace.[15]'

Suffice it then to say that a leading cause of the proliferation of governmental statistics is the need for statistical data in government economic planning. But the relationship works also in reverse: the growth of statistics, often developed originally for its own sake, ends by multiplying the avenues of government intervention and planning. In short, statistics do not have to be developed originally for politicoeconomic ends; their own autonomous development, directly or indirectly, opens up new fields for interventionists to exploit.

Each new statistical technique, whether it be flow of funds, interindustry economics, or activity analysis, soon acquires its own subdivision and application in government. A particular example is input—output analysis, which began as a purely theoretical attempt to lend empirical content to the Walrasian system of general equilibrium. It has now advanced to the point where its champions hail it as providing

'an integrated picture of the industrial mechanism. They believe it can measure with fair accuracy the changes in inter-industry relations that would follow assumed changes in the "final bill of goods. . . " In practice, the most important change in the bill of goods is that called for by way of large-scale rearmament. It is hardly astonishing, therefore, that most of the development and application of input—output studies have been connected with industrial mobilization.[16]'

There are other reasons why the statistically oriented will tend to become interventionists. For one thing, the economic statistician will tend to be impatient of all theory as "armchair speculation," and hence will tend to advocate piecemeal, pragmatic, decide-every-case-on-its-"merits" type of government planning. It is perhaps true, as Stigler declares, that few empirical economists have become outright socialists or communists; such a course would be much too theoretical for them. But neither do they become adherents of laissez-faire; instead, a case-by-case, ad hoc approach drives them down the path of a muddled government interventionism.

I do not know whether, as Stigler asserts, "the most radical wing of the new dealers was not distinguished for its empirical knowledge of the American economy." But certainly the Tugwells and the Stuart Chases and the Veblenians proclaimed their empiricism often enough. And historians of the New Deal generally praise it highly for its flexible, pragmatic approach.

Another reason why statistics and political pragmatism are mutually congenial is that the very hallmark of the pragmatic approach is to begin by looking for problems or "problem areas" in the society. The pragmatist looks for areas where the economy and society fall short of the Garden of Eden, and these, of course, abound. Poverty, unemployment, old people with scurvy, young people with cavities -- the list is indeed endless. And as each problem multiplies under the care of his eager research, the pragmatist calls ever more stridently for government to do something -- quickly -- to solve the problem. Only hard-headed, deductive, a prioristic economic theory can teach him about ends and means, allocation of resources, opportunity cost, and the other rigors of the economic discipline.

Considering the above discussion, it is no wonder that conservative members of Congress, in the days before they were indoctrinated in the modern economic niceties by the Joint Committee on the Economic Report, were very suspicious of the seemingly harmless expansion of federal statistical activities. Thus, in 1945, Representative Frank Keefe, conservative Republican congressman from Wisconsin, was in the process of questioning Dr. A. Ford Hinrichs, head of the Bureau of Labor Statistics, on the latter's request for increased appropriations. In the course of the questioning, Keefe's misgivings about government statistics emerged as a cry from the heart--unsophisticated perhaps, but at least of sound conservative instinct:

'There is no doubt but what it would be nice to have a whole lot of statistics.. . .  I am just wondering whether we are not embarking on a program that is dangerous when we keep adding and adding and adding to this thing.

We have been planning and getting statistics ever since 1932 to try to meet a situation that was domestic in character, but were never able to even meet that question.. . .  Now we are involved in an international question. . . . It looks to me as though we spend a tremendous amount of time with graphs and charts and statistics and planning. What my people are interested in is, what is it all about? Where are we going, and where are you going?[17]'

I think we can conclude that the nub of the difference between Stigler and myself is this: to him a radical or nonconservative is essentially a socialist or a communist. To me, a nonconservative is someone who advocates intervention rather than laissez-faire. The difference is one of frame of reference. If we define conservatism as Stigler does, then it is true that most economists are conservatives; if we define it as believing in laissez-faire, then the conclusion must be very different. For the key then becomes not so much economics and noneconomics as theory versus empiricism. Empiricists will tend less to be full-scale socialists, but will also drift generally toward intervention.[18]

Still, when all is said and done, it is probably true that even the proportion of believers in laissez-faire is much greater among economists than in other academic disciplines, and that the "average" point on the ideological spectrum in economics is considerably "to the right" of the average in other fields of study. It appears that the economic discipline, per se, imposes a rightward shift in ideological belief. And this, after all, is the main point of Stigler's article."

Murray Rothbard
http://www.campaignforliberty.com/article.php?view=846

[TrueLight]

The Latest Bailout: It's Still Greek to Me
By William Anderson
Published 05/12/10

"With the latest bailout package now aimed at the crisis with the "PIGS," we need to step back and ask just what has been done, for it is not what it seems. Unfortunately, we have seen the cheers from the Usual Suspects, beginning with the New York Times, which declared in an editorial:

'Europe's leaders stared into the abyss and finally decided to act. The nearly $1 trillion bailout package, arranged over the weekend, is intended to head off Greece's default and stop the crisis from dragging under other weak economies -- Portugal, Spain, Ireland and Italy are all vulnerable.

The European and American markets celebrated on Monday. The CAC-40 index in Paris rose almost 10 percent. The Dow Jones industrial average rose 3.9 percent. It was certainly the right thing to do. Coupled with the European Central Bank's promise to buy bonds from stricken European countries, it arrested the financial turmoil -- at least for now.'

The last sentence is unintentionally prophetic, for whatever "good effects" the announced bailout supposedly will create, they will be short and are paving the way for future crises. While Greece and other European countries were facing disaster at the present time, it is nothing like the disaster that looms because there still is an economic piper to pay.

To make matters worse, the U.S. Government and especially President Obama urged this package under the "try something big" approach, as opposed to the advice of "try something intelligent." Yet, that is what we are going to get: stupid policies that ultimately will undermine any hope of recovery.

First, and most important, the European Central Bank is not buying bonds with real money, just the printed stuff that will filter throughout Europe and elsewhere and devalue the accounts of anyone who is holding Euros. Like the United States, Europe is broke, and will be even more so once this "bailout" goes through.

Second, for all of the talk of "rescuing" Greece, Spain and Portugal, one asks: Rescued from what? It is easy to diagnose the sources of their difficulties: a bloated public sector complete with militant public employee unions and workplace rules that raise private employment costs to such ruinous levels that all three countries must deal with high unemployment. The "rescue" packages supposedly deal with the former (although I remain a skeptic that they will), yet the real problem lies with the latter, as government policies shackle private investment.

Keynesian economists believe that because governments man the printing press, an economy cannot go broke. Thus, Paul Krugman can write in his NYT blog:

'A more expansionary monetary policy could make a real difference -- especially if the ECB ends up accepting somewhat higher inflation. Suppose that Speece or Grain need to get relative prices down 15 percent over the next five years. If the eurozone has 1 percent inflation, that's 10 percent deflation in the periphery. If the eurozone has 3 percent inflation, all you need is stable prices. Also, a stronger overall eurozone economy means higher GDP and hence higher revenue, making the fiscal slog less grim. (Emphasis mine)'

There he goes again. Keynesians believe that as long as people are spending (and spending and spending), an economy automatically moves along and all is well. Austrians, however, understand that while things might seem fine on the surface, there is turmoil and distortion among the factors of productions. Although Keynesians believe that the factors are homogeneous and that factor prices always adjust evenly to consumer spending, that simply is not the case.

Economic downturns do not occur because people stop spending, as Keynesians believe. Instead, people stop spending because the economy moves into recession, and stuffing more paper money into the hands of people so they can continue to spend only makes matters worse. Why? Because the recessions are centered on malinvestments which no longer can be supported by consumer spending patterns, the factors associated with those malinvestments also must be liquidated or transferred to other uses in order to allow a real economic recovery to begin.

Bailouts do not just prevent that process, but they also encourage malinvestments to continue, furthering the patterns of distortion and making them worse. At some time, the further rounds of inflation no longer can paper over the distortions and the resulting economic collapse is much worse than it should have been. Thus, instead of "saving" Europe, the central bankers only have put off the Day of Reckoning, which surely will arrive at a future date."

William Anderson
http://www.campaignforliberty.com/article.php?view=847

[TrueLight]

im just going to post it here but this 8 part lecture by Edward Griffin is fascinating... its about communism

This 1960s lecture on communism warns how a nation can be weakened and destroyed from within. The trick is to convince the people that they must give up some of their freedom for some supposed greater good.

p1- http://www.youtube.com/watch?v=Qdt46Uk61UY


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This is fascinating too

Mind blowing speech by Robert Welch in 1958 predicting Insiders plans to destroy America. prophetic?
http://www.youtube.com/watch?v=AZU0c8DAIU4

[Voltaire]

eccccccchhhhhhoooooo

[TrueLight]

i haven't forgotten about this thread its okay Voltaire

Does Malinvestment Matter?
By William Anderson
Published 05/27/10

"Two years into the Obama administration we have seen an unprecedented rise in government spending and unprecedented federal budget deficits, all in the name of "stimulating" the economy. Nor is Barack Obama the only president to engage in economic "stimulus"; his predecessor George W. Bush also spent recklessly for the same reason.

Yet with literally trillions of dollars spent, the rate of unemployment hovers around 10 percent, many banks remain in a precarious state, and a meaningful economic recovery is as elusive as ever. On one side the Keynesians claim that had the government not spent these huge sums, the economy would have collapsed even more.

On the other side, however, are the members of the Austrian school of economics, who say that the very rush of government spending, along with the expansionary monetary policy of the Federal Reserve, has made the economy weaker not stronger. Obviously, the differences between the Austrian and the Keynesian views are fundamental, so if I am to point out why Austrians do not support government "stimulus" efforts, I need to supply something other than the usual political rhetoric.

Of the two economic viewpoints, the Keynesian one is easier to explain and appeals to the sentiments of ordinary people. As long as individuals spend all their income on consumption goods and do it quickly, the economy will hum along. However, if people get nervous and save some of their money, the economy will slip into the doldrums and only can be rescued by government spending.

In the Keynesian viewpoint, an economy is a circular-flowing mechanism that simply needs enough money to keep the wheels greased. Nothing else matters, just as long as the money keeps flowing.

The Austrian View

Austrians hold to a much different viewpoint. Here I wish to deal with what Austrians call malinvestments and explain what they are and why they lead to recessions. While Keynesians believe that the only thing which matters is spending on consumer goods (with all factors of production, including labor and capital, simply following whatever spending patterns arise), Austrians understand that the structure of production matters.

The production structure is the mix of factors that are used to produce goods over time, and in a market economy the value that consumers place on the final, or consumption, goods will be imputed to the various factors. For example, during the housing boom, a number of factors went into that line of production, from building materials to real estate agents. While the government directed new credit into the housing market, the economy boomed as owners of the factors gained new income.

However, the market could not sustain the housing boom as home prices increased at much faster rates than individual incomes and home sales fell. Furthermore, the financial instruments created to help finance the boom also lost value as it became obvious the boom could not continue.

In the Keynesian view the housing boom did not need to end; all that was needed was for the government to throw even more money into it and have the Federal Reserve purchase at face value the financial paper that had lost real value.

Austrians, however, hold that there were massive malinvestments in housing, and that the malinvested factors needed either to be liquidated or transferred to other uses that would reflect the directions of consumer choices.

Austrians believe that once an unsustainable boom begins, a bust is inevitable, and further attempts to sustain the boom only pull the structure of production into more distorted and unwieldy shapes. Thus the "stimulus" spending, according to Austrians, has not sustained the economy, but rather has further disfigured it, guaranteeing more disruptions in the future.

There is no way to reconcile these two viewpoints. To Keynesians an economy is a homogeneous mix of goods that needs only more money to be sustained. Austrians, however, know better. They understand an economy is complex and full of heterogeneous factors. Government stimulus, they realize, only makes things worse."

William Anderson
http://www.campaignforliberty.com/article.php?view=890






Liquidity Trap or Malinvested Resources?
By William Anderson
Published 06/03/10


"Many people claim today that the U.S. economy is in a "liquidity trap" and only government can spend us out of this mess. Commentators from Paul Krugman to Martin Wolf of the Financial Times assert we are in a "Keynesian situation"; unless government spending rescues us, we are doomed to suffer decades of economic stagnation.

The idea is simple, and appealing. According to those who follow Keynesian analysis, when the economy slows, due to less aggregate spending by consumers, there are two ways to "stimulate" it to "full employment." The first is for the central bank to lower interest rates to encourage business borrowing and thus more spending.

However, what if interest rates are near zero already and businesses still are not borrowing? In that situation Keynesians claim that individuals and businesses prefer to hold cash because they anticipate that interest rates may rise in the future. When that happens, the second policy prescription should be employed: increased government borrowing and spending to directly increase aggregate demand.

"Monetary policy" and "fiscal policy," as they are called in economics textbooks, are simple and very popular. First, they are quite easy to teach: Instructors simply convert the typical supply-and-demand diagram into an "aggregate supply-aggregate demand" model. Instead of prices and quantity on the vertical and horizontal axes, respectively, the vertical axis on the AS-AD gives the "price level" and the horizontal axis denotes "Y," or gross domestic product (GDP).

The trick to putting the economy into "full employment" of resources is to move AD to the point where the economy nears "capacity." But an economy caught in a "liquidity trap" is not going to see AD shifted by "monetary policy," or the lowering of interest rates. Thus the only way for the economy to be "rescued" from this "equilibrium" of low output and high unemployment is for governments to borrow and spend, even at what might be considered to be "reckless" levels. Martin Wolf writes:

'If, alternatively, monetary policy is ineffective, as it may be, fiscal tightening should be announced, but implementation should be postponed until recovery is secure. I have now lost faith in the view that giving the markets what we think they may want in future -- even though they show little sign of insisting on it now -- should be the ruling idea in policy. [Emphasis mine.]'

Another Explanation

Economists of the Austrian school give another explanation, which resorts to neither Keynesian policy prescription and in which there is no such thing as a "liquidity trap." Last week I wrote of malinvestments, which are investments made during the a boom that cannot be sustained because consumer spending patterns, which ultimately determine production structures within the economy, will not permit investments at their previous levels. (The collapse of the housing boom created the present situation.)

Austrians note that government actually retards economic recovery by holding down interest rates. First, government tends to target new money created by the banking system toward those industries that have become depressed, ignoring the malinvestments that originally put them into that situation. Thus malinvestment persists, pulling capital and resources from economic sectors that originally were not as badly damaged during the boom and subsequent recession.

Second, economist Robert Higgs notes that government activism to end the downturn creates what he calls "regime uncertainty." In its efforts to "do something," Higgs notes that governments often are hostile to private property rights and discourage long-term investments by healthy firms. Furthermore government is even more hostile to profitable firms and successful individuals, claiming they are not "paying their fair share" of taxes, making future investment less certain.

The U.S. economy recovered nicely from a severe recession in the 1980s, even with double-digit interest rates and low rates of inflation, which Keynesians would claim to be impossible. True, government spending rose during that time, but not nearly at the rate it has risen the past few years.

There was no "Keynesian situation" then, and there is none today. There only are malinvestments."

William Anderson
http://www.campaignforliberty.com/article.php?view=909

[transgression]

been going through some of the articles from the website recently - really enjoying it.

[TrueLight]

great to hear someone whose interested in it

[TrueLight]

Suiting Up for a Post-Dollar World
By John Browne
Published 06/26/10

"The global financial crisis is playing out like a slow-moving, highly predicable stage play. In the current scene, Western governments are caught between the demands of entitled welfare beneficiaries and the anxiety of bondholders who fear they will be stuck with the bill. As the crisis reaches an apex, prime ministers and presidents are forced into a Sophie's choice between social unrest and bankruptcy. But with the "Club Med" economies set to fall like dominoes, the US Treasury market is not yet acting the role we would have anticipated.

Our argument has always been that the US benefits from its reserve-currency status, allowing it to accumulate unsustainable debts for an unusually long period without the immediate repercussions of inflation or higher borrowing costs. But this false sense of security may be setting us up for a truly monumental crash.

There is fresh evidence that time is running out for the dollar-centric global monetary order. In fact, central banks outside the US are already making swift and discrete preparation for a post-dollar era.
To begin, the People's Bank of China has just this week decided to permit a wider trading range between the yuan and the dollar. This is the first step toward ending the infernal yuan-dollar peg. While the impetus behind this abrupt change remains a mystery, I have a sneaking suspicion that, as my colleague Neeraj Chaudhary explained in his commentary last week, the nationwide labor strikes were a prime motivator.

In response to the 2008 credit crunch, the Fed printed so many dollars that the People's Bank of China was forced to drive Chinese inflation into double digits to maintain the peg. The pain has fallen on China's workers, who have seen their wages stagnate while prices for everything from milk to apartments have skyrocketed. This week's move indicates that, regardless of its own policy motives, the Communist Party can no longer afford to keep pace with the dollar's devaluation. The result will be a shift in wealth from America to China, which may trigger a long-anticipated run on the dollar, while creating investment opportunities in China.

Just days before China's announcement, Russian President Dmitry Medvedev rattled his monetary sabre by telling the press of his intention to lead the world toward a new monetary order based on a broad basket of currencies. Giving strength to his claim, the Central Bank of Russia announced that it would be adding Canadian and Australian dollars to its reserves for the first time. Analysts suggest that the IMF may follow suit. While Russia floats in the limbo between hopeless kleptocracy and emerging economy, it does possess vast natural resources and a toe-hold in both Europe and Asia. In other words, it will be a strategically important partner for China as it tries to cast off dollar hegemony.

Speaking of Europe, the major powers there are moving toward a post-dollar world by rejecting President Obama's calls to jump on America's debt grenade. The prescriptions coming from Washington translate loosely to: our airship is on fire, so why don't you light a candle under yours so that we may crash and burn together. Given that dollar strength is largely seen as a function of euro weakness (as Andrew Schiff discussed in our most recent newsletter, debt troubles in the eurozone's fringe economies have created a distorted confidence in the greenback. However, as you might imagine, Europe has higher priorities than being America's fall guy. Led by an ever-bolder Germany, the European states are wisely choosing not to throw themselves on our funeral pyre, but to wisely clean house in anticipation of China's rise.

In another ominous sign for the dollar, the Financial Times reported Wednesday that after two decades as net sellers of gold, foreign central banks have now become net buyers. What's more, more than half of central bank officials surveyed by UBS didn't think the dollar would be the world's reserve in 2035. Among the predicted replacements were Asian currencies and the euro, but - by far - the favorite was gold. This is supported by Monday's revelation by the Saudi central bank that it had covertly doubled its gold reserves, just about a year after China made a similar admission. There is no reason to assume these are isolated incidents, or that the covert trade of dollars for gold doesn't continue. To the contrary, this is compelling evidence that foreign governments are outwardly supporting the status quo while quietly preparing for the dollar's almost-inevitable devaluation. What people like Paul Krugman believe to be a return to medieval economics may, in fact, be the wave of the future. 

In peacetime, hardened troops will likely tolerate a blowhard general for an extended period; but when the artillery opens up with live ordnance, an ineffectual leader risks rapid demotion. The newspapers are now riddled with hints that foreign governments have lost faith in Washington and the dollar reserve system. It seems to me only natural that after a century of war, inflation, and socialism, the next hundred years would belong to those people who hold the timeless values of hard money and fiscal prudence. Unfortunately, our policymakers are not those people."

John Browne
http://www.campaignforliberty.com/article.php?view=968









Hayek's Road to Serfdom: Despotism Then and Now
By Thomas DiLorenzo
Published 06/26/10

""Every economy has its contradictions ... . What counts is results, and there can be no doubt that the Soviet planning system has been a powerful engine for economic growth." -- Paul Samuelson, Economics, 1985 edition

"Contrary to what many skeptics had earlier believed, the Soviet economy is proof that ... a socialist command economy can function and even thrive." -- Paul Samuelson, Economics, 1989 edition

"The Road to Serfdom was 'inaccurate innuendo about the future'." -- Paul Samuelson, 2009

When Friedrich A. Hayek published his classic book, The Road to Serfdom, in 1944 he was loudly denounced by academic statist apologists in England, where he resided at the time, and in America. In the preface to the 1976 edition of the book Hayek noted that a prominent philosopher even denounced the book despite admitting that he had not read it! But average citizens did read it. The book was a gigantic success in America, quickly selling over half a million copies. Millions of copies of a condensed Reader's Digest version of the book were also sold and widely read.

The court historians in academe were not concerned about Hayek's age-old warnings about the dangers that centralized political power posed to liberty and prosperity, for they intended to be beneficiaries of that power as well-paid advisers to the state. Millions of average citizens were not as enthusiastic, especially Americans who, during the war, had experienced oppressive and confiscatory taxation, the slavery of military conscription, government-imposed product rationing, pervasive shortages of basic staples, and endless bureaucratic bungling.

Hayek's motivation for writing The Road to Serfdom was the shocking speed at which so many Europeans -- especially in Germany -- had simply forgotten all that they had learned over the centuries about the virtues of a free society, the need for limitations on government power, the dangers of centralized power, and the workings of capitalism as a worldwide network of mutually advantageous exchange. It only took a couple of decades of socialistic sloganeering to persuade Germans to abandon their classical-liberal roots and embrace Big Government of the worst sort.

Hayek was deeply concerned that the same despotic ideas were also becoming more and more popular in England, America, and in other countries. As the above quotations of MIT's Paul Samuelson demonstrate, much of America's educational "elite" was enamored with Soviet communism and central planning. Samuelson even went so far as to say in his textbook, which was by far the biggest seller of its day, that "it is a vulgar mistake to think most people in Eastern Europe [during communism] are miserable."

The parallels to today's world are unsettling, to say the least. Perhaps this is why, a few weeks ago, The Road to Serfdom ascended to #1 in sales on Amazon.com after Glenn Beck discussed the book on his Fox News Channel program. There may not be a Hitler on the horizon, but the extent to which governments all over the world have simply ignored the lessons of the past in response to the economic crisis that they created with their own monetary policies and other interventions is mind boggling. The US government, in particular, responded to the bust portion of the Greenspan Fed's boom-and-bust cycle with the most economically destructive -- but politically centralizing -- policies: trillion-dollar bailouts of failing corporations that will create moral-hazard problems the likes of which have never been seen; an escalation of the money supply that dwarfs the monetary inflation of the Greenspan Fed; the Soviet-style nationalization of automobile companies, banks, and much of the healthcare industry; government regulation of executive compensation; the appointment of dozens of dictatorial "czars" with unaccountable power to regulate and regiment myriad industries; trillion-dollar-a-year deficits; an expansion of the powers of the Fed (!); and a president who believes he has the power to fire corporate executives, nationalize industries, and send unmanned "drone" bombers to any country in the world on a whim.

Washington DC no longer recognizes any limits at all to its powers to "socially plan" all aspects of American life. This totalitarian impulse is not limited to national politics. The mayor of New York City believes he has the power to regulate all of the eating and drinking habits of New Yorkers, even including how much salt they consume with their meals and what type of soft drinks they can enjoy.

The subtitle of the 1976 edition of The Road to Serfdom, published by the University of Chicago Press, is "A Classic Warning Against the Dangers to Freedom Inherent in Social Planning." The exponential explosion of governmental powers in response to the current, government-generated economic crisis makes The Road to Serfdom as relevant today as it ever was (as Glenn Beck's audience instinctively understands). This is why the Mises Institute is offering a special five-week online class, The Road to Serfdom: Despotism Then and Now, under my direction through the Mises Academy, beginning on Monday, July 5. The course will be an in-depth examination and discussion of Hayek's analysis, its relevance to today's world, and how such ideas can be used to put America -- and other parts of the world -- back on the road to freedom.

Hayek's insights were remarkable, and remain so to this day. He understood and explained the power of ideas: European fascism could never have been adopted without a 25-year propaganda campaign against individualism (basic respect for the individual), classical liberalism, and free-market economics. He pointed out the "fatal conceit" of believing that government bureaucrats could "plan" an entire society. He explained why socialism -- including its fascist variant -- meant little more than "equality in restraint and servitude." "Marxism has led to Fascism and National Socialism," he wrote, "because, in all its essentials, it is Fascism and National Socialism [i.e., Nazism]."

Hayek saw through all the rhetorical tricks and gimmicks of the socialists of his day, one of which was the constantly repeated refrain that socialism and government "planning" was "inevitable"; therefore, it is futile to oppose it. Nor did he fall for the gimmick of wrapping totalitarian socialism in the mantle of the god of democracy. Government planning is inherently incompatible with both democracy and the rule of law in the long run, he explained, and leads to some degree of economic dictatorship. Any business person who has had to deal with the dozens of federal, state, and local government regulatory agencies knows that "economic dictatorship" is a key feature of the current American political system.

"The worst" always rise to the top of the political heap under a regime of government planning, Hayek explained, for they are the ones with the least qualms about brutalizing their fellow citizens and depriving them of their liberties. All of this can only be sustained by what Hayek called "The End of Truth," or the effects of massive government propaganda that demonizes the civil society, individualism, and the system of peaceful voluntary exchange and private property (capitalism), while glorifying all aspects of the state.

The purpose of this course, The Road to Serfdom: Despotism Then and Now, is to educate students about these contemporary dangers and arm them with the intellectual ammunition that they will need to oppose them and champion freedom instead. The totalitarian socialists of the early 20th century understood that they could not succeed unless they first discredited the ideas of freedom. The only way to stop their intellectual descendants ("the totalitarians in our midst," as Hayek would call them) is to counter their totalitarian ideas. Hayek was a hero of society for putting his career as a renowned economic theorist on hold (for most of the rest of his life, it turned out) to lay out one of the most articulate arguments for a free society ever made. We must revisit and strengthen these arguments if we are to choose capitalism and freedom over socialism and serfdom."

Thomas DiLorenzo
http://www.campaignforliberty.com/article.php?view=967

[transgression]

Obama’s “regime change” of socialist control

By: Pieter Samara
Posted:  June 18 2010

With all the solutions available from the private sector and from around the world since day one, to deal with the oil spill, President Obama has stalled on allowing any of these going forward for the following reasons:

To increase the power of government over the private sector. To allow the private sector to solve the problem would defeat and undermine Obama’s assertion that only government and government-owned companies, bureaucracies and labor unions can provide the solution. Obama sees the private sector as inherently evil, as reflected in the fact that he refused to meet with BP to establish a working relationship with the company to cut through all the bureaucratic red tape.

While BP attempts to cap the Deep Water Horizon well, it has to be remembered that the government forced BP to drill at a depth of 5,000 feet, one of the deepest wells ever drilled, creating the crisis. BP had wanted to drill at a depth of 500 feet. The result of the blowout has been that the government, Obama, and Democrats in Congress have threatened and talked down BP and its efforts. On the one hand, they require BP to obtain approvals from the government to move forward, while on the other hand they vilify the BP president and CEO during Congressional hearings, due to the government’s own delays.

Meanwhile, the Obama Administration failed to grant requested waivers to the 1920 Jones Act that would allow foreign ships and skimmers to enter U.S. water, refusing international assistance from 33 countries and stalling and minimising Louisiana’s creation of sand barriers, as well as stalling numerous private sector solutions that the Administration has refused to take heed of. One such example offered on May 3 was from Dr. Henry Crichlow, the leading oil blowout specialist worldwide, who developed the blowout engineering after Gulf War I for 800 or more wells in Kuwait, who provided quick relatively inexpensive solutions to either recover the oil with the Crichlow connector from the pipe a mile down or to “Kill the Spill” completely.

As part of the orchestration of the crisis, liberals in Congress threatened to put BP into receivership, while Obama played to the radical left with a threat to take over BP’s assets, if they could not force BP to allocate $20 billion in an escrow for a government appointee to administer. The result was that despite BP’s balance sheet, the U.S. government has succeeded to cause a FITCH downgrade of BP’s unsecured debt from AA to BBB, with BP shares losing a market cap value of $90 billion. The Obama Administration demanded that BP make payments it had already agreed to make, thus financially weakening the very company the government asserts it wants to be able to shoulder the burden of the fines, the oil cleanup and claims of lost revenues for the Gulf states.

Force Obama’s Cap & Trade bill and energy tax through Congress. Under the Obama policy of “don’t let a good crisis go to waste,” such stalling and delaying mentioned above allowed the crisis to get bad enough for Obama to have the “audacity” in his Oval Office speech to the nation to contrive and justify his Cap & Trade climate bill. Since the beginning of the blowout, the private sector and the States have been fighting with the Administration to get approvals to take action. However, the longer the Administration could stall, the worse the situation would become for BP, the States and Gulf coast businesses, exacerbating a crisis further by creating a moratorium on current and new shallow water drilling threatening hundreds of thousands of jobs.

Cap & Trade, involving a Chicago carbon exchange and other companies that Obama and/or his associates may have financial interests in, was all but dead in the water until the BP oil blowout crisis renewed “hope” that he could revive it again. Cap & Trade is designed to increase the cost of energy to the private sector by more than 10 percent, lowering GDP in the process.

Organisation for Economic Cooperation and Development (OECD) studies have demonstrated that for every 1% reduction in the cost of energy there will be a 3% increase in manufacturing and industrial output. This occurred when President Reagan deregulated the oil industry, creating an economic boom. Obama is moving in the opposite direction—that of higher taxes and more federal government control on a permanent basis.

To effect “regime change” toward statism. Why would the Administration willfully let the Coastal region be damaged, destroying revenues and lives to create a crisis, as an “end justifies the means” call for Cap & Trade? The answer is that we just need to look at the cause of the systemic financial crisis itself, which was intended to achieve, as Mohamed El Erian, CEO of PIMCO, himself called it, “regime change” in the U.S. and globally. “Regime change” in the U.S. means an inexorable shift of control and ownership of private sector capital and productivity of the populous to the federal government and Federal Reserve.

“Regime change” in the United States entails a paradigm shift away from free enterprise capitalism and the establishment of a socialist government which assumes ownership and control of capital and human resources. Its projected culmination to a “New Normal” of slow economic growth and bigger government within four years will make it forever impossible for the U.S. to reinstate the free enterprise capitalist system, as every political and social act will be dictated by the elite in Washington.

Such “regime change” was facilitated by the government’s stealth regulatory change on November 9, 2007, from hold to maturity accounting to “mark-to-market” accounting, which caused the collapse in private sector capital formation and access to credit in 2008 and 2009, unless accompanied by government ownership or guarantees that allow such debt to be reclassified under the government’s sole right hold to maturity valuation.

Without the mark-to-market regulatory change, the markets would not have collapsed and we would still have a booming economy. Instead, we have a loss of over $10 trillion in private sector wealth and a shifting of private sector ownership and control of capital to the government and Fed. Thus, clearly, if the government and “special interests” are willing to orchestrate an unmitigated economic collapse allowing over $10 trillion in private sector savings to be lost to effect a “regime change” to a “New Normal” culminating in their total ownership and control of financial and human resources, then government stalling in its response to the oil spill to create a crisis to justify the resurrection of Cap & Trade to further such “regime change” is small potatoes by comparison.

http://australianconservative.com/2010/06/obama%E2%80%99s-%E2%80%9Cregime-change%E2%80%9D-of-socialist-control/

[TrueLight]

i agree with most things in that article

but remember BP is in bed with the US government as well
they have the liability cap put on them by government and they lobby for the cap and trade legislation which they can profit from the subsidies they would get etc...

Once a government pet, BP now a capitalist tool
By: Timothy P. Carney
Examiner Columnist
June 9, 2010
http://www.washingtonexaminer.com/nation/Once-a-government-pet-BP-now-a-capitalist-tool-95942659.html


Here's some other good articles and videos

'All of the Above' energy policy is just rightwing rent-seeking
By: Max Borders
http://www.washingtonexaminer.com/opinion/blogs/Examiner-Opinion-Zone/All-of-the-Above-energy-policy-is-just-rightwing-rent-seeking-95525679.html


Oil spill optimism: Keeping some perspective
By: Max Borders
Special to Examiner
05/25/10 4:52 PM EDT
http://www.washingtonexaminer.com/opinion/blogs/Examiner-Opinion-Zone/Oil-spill-optimism-Keeping-some-perspective-94864214.html


Quadruple tax for oil spills? Why not make BP and others insure themselves?
By: David Freddoso
Online Opinion Editor
05/25/10 10:56 AM EDT
http://www.washingtonexaminer.com/opinion/blogs/beltway-confidential/quadruple-tax-for-oil-spills-why-not-make-bp-and-others-insure-themselves-94827229.html


Ron Paul on Bb oil spill
against liability cap and moratorium on drilling for oil
http://www.youtube.com/watch?v=HRUOBOPPQ5k

1:10 onwards http://www.youtube.com/watch?v=ZR9E3e9EtqI

3:42 onwards - http://www.youtube.com/watch?v=8bPUAz5CKQ4

1:05 onwards http://www.youtube.com/watch?v=6cwfSKIuFZA

Ron Paul on BP Commission
http://www.youtube.com/watch?v=LlvomBscpa8

Peter Schiff on bp oil spill and the economic impacts of the moratorium on drilling for oil
4:27 onwards http://www.youtube.com/watch?v=foaVKTalOQs

[TrueLight]

Nifty 3 min video on The Broken Window Fallacy
http://www.youtube.com/watch?v=QG4jhlPLVVs&feature=player_embedded

[Pappa-Bohr]

Hey Truelight, taken a look at US 10-year bond rates lately?? What happened to hyper inflation and the US dollar you and your cronies where foreseeing???
Austrian economics=fail.

[TrueLight]

well on the latest peter schiff video he said that he thinks the dollar will decline rapidly in 2011 and maybe 2012... so not yet. marc faber has said that hyperinflation etc will most likely happen in 10 years. so these things are forecasts into the future not something that will happen now since the us is still trying to "stimulate" the economy... they have this fancy thing giving 50k to people who can't pay their mortgage or something like that and china has cut its holding of american treasury bonds as well

http://www.acting-man.com/?p=4549
Peter Schiff Deflation vs Inflation Argument
http://www.youtube.com/watch?v=-NqF68Y8Jmw