An Apology from the RNC to the American people!

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An Apology from the DNC to the American People

The Democratic National Committee would like to take this opportunity to sincerely apologize for President Obama’s milquetoast stands on important issues. He takes the party base for granted, and is just as bribable as a Republican on issues that are important to the American people! We are sincerely sorry that we must now watch him walk back in to the 2012 Presidential nomination with so much compromise and betrayal of campaign promises as his record.

It has been a disgusting spectacle to watch over the past few years hasn’t it? A landslide victory was won over the Republicans after 8 years of George W. Bush’s illegitimate rule. Only to see that after inauguration, the foulest parts of our system could easily bribe and control the Democratic leadership as well. Those that did not wish to concede to the minor reforms after Congress justly altered a demonic profiteering Health Care System bought themselves a “grassroots” movement to turn the tide the other way. And this was met with compromise, caving in, and often kowtowing to people who did not and will never vote for Obama.

As we speak, citizens are organizing in the Occupy Wall Street movement. There is justifiable outrage at Goldman Sachs selling and promoting Mortgage backed Securities at one of their investment desks while simultaneously shorting those very Securities at another desk. This led directly to the AIG bailout. They managed to profit heavily off of the economy going under. The Department of Justice has been pitiful in its response. This is the same Justice Department that is cowardly refusing to enforce the law when any Right Wing preacher endorses a candidate from the pulpit-
And when can the Justice Department under Obama be called on to enforce the law? Why when it breaks a 2008 campaign promise of course! The Pharmaceutical industry is currently in Stage 3 trials of Marijuana based drugs like Sativex and that means it can’t have voter approved Medical Marijuana dispensaries selling a plant at a lower price.

Obviously Obama and Holder’s DOJ is a cruel and insipid joke under these circumstances. We could have had a Republican in office and had this kind of big government intrusion over State’s rights for the benefit of a corporate crony happen! We’re sorry. We really are. We are the sorriest excuses for public servants because we promised the opposite and then screwed over our base of supporters!

And it has certainly been sickening to watch hypocrites like Boehner, Cantor, and Ryan cite cutbacks in Federal and State jobs as what is needed to “create jobs”! But we are no better. As this is written, “Free trade” agreements with Colombia, Korea and Panama are being railroaded through Congress. These agreements have a history of sacrificing GDP for gains in speculative markets. At a time of high unemployment we are going to be shipping more jobs overseas for corporate profits. One of the bright spots in the 2008 debate was McCain calling a Columbia “Free Trade” agreement a no-brainer as he asserted that country that taxes its cocaine is helping us try to stop the flow of drugs into our country that's killing young Americans. The 2008 Obama responded “the history in Colombia right now is that labor leaders have been targeted for assassination on a fairly consistent basis and there have not been prosecutions.”
But if a Free Trade Agreement is signed into law, not only can Obama join Boehner and Ryan in the shameful “We-have-to-cost-ourselves-jobs-to-create-jobs” club, but it will be his signature drying on a treaty with a government that targets labor leaders and doesn’t prosecute!
And then there was letting Cap and Trade die and coming out for oil drilling in the Gulf (essentially giving the middle finger to every environmental activist that canvassed for him) right before the largest oil spill ever. It was directly linked to corporate greed and negligence. Granted Obama did get a whole 3 billion dollars set aside from BP to deal with this mess. But to the DNC’s shame, no one was arrested for their negligence!
You have no idea how ashamed we are to have this man walk back into our party’s nomination. Our only hope really is for a national replay of the Nevada Reid vs Angle contest. A dismal sold-out center right Democrat vs a raving lunatic who endorses a theocracy! It’s as though the attitude of Democrats once elected is “Screw you, what are you going to do? Vote Republican?” It’s no wonder that you’ve taken to the streets.
Only know that despite the ads you will see over the coming year, we here at the DNC are so sorry it’s come to this, we really are!
We are honestly so fucking sorry!

Why you shouldn't consider a President Perry if you really care about small government!

Forget the abysmal environmental record, the rigged numbers regarding employment, and the shallow demagoguery that should shame every decent Christian who sees it. The real reason you can't call yourself a small government conservative and work or vote for a President Perry is his record regarding guilt and innocence under his administration. It is a model of corruption, incompetence, and dangerous abuse of power that no sane person would wish to apply to the Federal government!

The Death Penalty is probably the most egregious act of power a State, any State, can commit. Never is the collective will of a tax-funded bureaucratic collection of insulated tyrants more naked than when it chooses to extinguish a human life. And I have been on both sides of this issue. I can completely empathize with the outrage of the family of a murder victim and cannot say that I wouldn't join their ranks if something horrible like a murder took away someone close to me. But I also do not approve when the State commits the exact same crime. What's more (I know I'm going to sound like a Libertarian saying this, but I'm not), when the cruel brute force of something like the State takes an innocent life, it shows all of us what an unthinking monster deserving of restraint it truly is.(Now the question of whether or not Private Enterprises display the same characteristics is one for another day)
The administration of the State of Texas by Rick Perry provides us with a textbook example of how this unthinking monster needs to be restrained when it comes to not only the Death Penalty but the protection of the well connected and guilty.

In 2004, Cameron Todd Willingham was executed by the State of Texas for alleged arson in a fire which took the lives of his three daughters in 1991. The evidence that the fire was arson were based on the techniques used by the local authorities in Corsicana, Texas. While he was on Death Row, a fire science expert got a chance to look closer at the case and determined that there was no evidence for arson. The report was sent to Rick Perry's office and the request for a 30 day stay so the evidence could be reviewed was denied. Cameron Todd Willingham was executed as a direct result of this inaction.

Texas Forensic Science Commission was formed by the Texas legislature to investigate bad science in murder investigations and abuses of power. They hired two independent experts and determined that there was no evidence for arson in this case.

Perry's response?

In October 2009, when the commission was about to accept a verbal report of one of these scientists, Perry removed Commission members and canceled that presentation.

I don't know about you, but I don't need to go any further!.Turning a blind eye to that inaction and coverup by Rick Perry, while at the same time mouthing Fox News talking points about “freedom”, railing against “Obamacare”, and listening to a carefully rehearsed Heritage Foundation presentation about Liberty makes a joke out of anyone who supports Perry. That's because that kind of behavior is exactly the kind of abuse of power that the Founders wanted to prevent. And turning a blind eye to it can only bring about a tyranny by empowering people like Perry more.

But wait, it gets worse! We've seen how a State headed by Rick Perry treats the innocent, how does it treat the guilty?

The legal tradition of Separation of Church and State usually receives lip-service and derision in far right circles. And to be fair, it is a good idea made of legal precedent, not actually in the Constitution. The Constitution only mentions religion twice and neither mention is a positive one. The State of Texas recently experienced a national headline making case that illustrates the need to separate Church and State.

FDLS leader and convicted child molester Warren Jeffs was recently sent away for life in spite of Rick Perry's actions not because of them. The members of the FDLS church were in charge of many aspects of life in those small rural towns. Call the police on Warren Jeffs? Hah! That's just not going to do a lot of good when then the judge, the sheriff, the deputies, the administrators are all members of the FLDS.

In an upcoming book-Profit's Prey (as of this writing it is available for e-book release) by private investigator Sam Browers (the lead investigator who is responsible for bringing down Jeffs), it is revealed that the initial 2008 raid of the FDLS's YFZ ranch resulted in every Texas Child Protective Services official that had anything to do with the case being either fired or reassigned. The molested child “wives” were then returned to their molesters. If that action did not come from the Governor's office then it can not be an excuse that he knew nothing of it. Complicity or Ignorance-both are equally as foul when dealing with the raw power of a State!

I've seen in my own line of work accused thieves and accessories to theft be fired just for proximity to a case. The reason is usually that they were either participants or too stupid to see the obvious. Either way, they don't belong in that position. The same thing standard has to be applied to Rick Perry when it comes to firing public servants so as not to embarrass well connected supporters.

The returning of molested children to their molesters is flat out inexcusable! Government small enough so it can't enforce the prosecution of institutionalized child rape is nothing to be proud of!

With Rick Perry's Texas, we have a proven record of the innocent being persecuted (and in this case killed) and the guilty being protected. That is exactly the kind of behavior that we never want to see in an elected official. And now we have him being endorsed as a “Tea Party” candidate? We can expect exactly what we got from the last Texas governor to be installed in the White House if we turn a blind eye to this proven record of State abuse.

Oh and come to think of it, the last time we believed a Texas Governor who promised a small government we had -

A CIA agent exposed for blatant petty political revenge. And a presidential pardon of the political hack responsible.

Voter Machine Fraud in the reelection campaign that was never completely investigated.

An attempt to privatize Social Security that was followed by an admission that privatization would do nothing to help solvency.

Money delegated to fix the levies in New Orleans after decades of crumbling diverted to foreign affairs. Then we had Hurricane Katrina flood the city who then had to endure two weeks of anarchy, death and sewage water.

A National ID act passed so as to take Driver's License standards away from the states.

A politically motivated firing of US Attorneys who were prosecuting Republicans while at the same time ignoring prosecutor misconduct against Democrats!

An expanded deficit three times (a lot of which is no-bid military contracts) that of what Obama spent to deal with the mess he inherited.

Private contractors murdering civilians in an occupied territory.

Appalling conditions in Walter Reed hospital. It shows the degree to which people like our Texas Governors actually “Support the Troops”.

Torture at Ahu Grahib and other shadow facilities that did not reveal any worthwhile information. (They are brazenly lying when attributing this to finding Bin Laden). This was followed by no prosecution for the bureaucrats in charge.

The ignored warning in August 2001 that there was an attack planned by Bin Laden in the USA.

A projected tax surplus spent and this country needing China in order to keep our economy going.

The record of ex-Texas Governors in the White House actually being small government speaks for itself. And Rick Perry is so “small government” that he-

Took Texas from $49 billion in spending when he entered office to $90 Billion in spending now.

Maintains a higher Debt to GDP ratio than California-Perry's Texas rate is 22.9% with debt per citizen at $10,645 and Left Coast California (Pelosi's home) is 18.7% with $9932 in debt per citizen.

Has doubled the state debt. Can you imagine what the US debt will look like if he gets a hold of it?

Has spearheaded efforts to lease roads to foreign corporations. That means taking something the taxpayer paid for and giving it to a foreign corporation so they can charge a toll on something that used to be free and was paid for by the taxpayer.

So, Rick Perry is small government in talking points and campaign slogans only. And he has a proven record of covering up for the guilty if they are well connected while ignoring the victims and killing the innocent then covering up his actions.

Are my fellow Americans that easy to mislead that they can seriously consider this man as a potential president? This kind of political monster is so evil that I could find myself voting for Obama just to keep him out of office.

And I think that is just what Obama is counting on. A national replay of Reid vs Angle.

Well, Mr. Santelli..., Are YOU listening?

In a recent interview, Rick Santelli made the assertion that it was because of the Tea Party the USA wasn't downgraded to BBB status by the same geniuses at Standard and Poors who saw Lehman Brothers and Bear Stearns as solvent companies worthy of high ratings. In the middle of another vanity rant in front of CNBC's cameras (this time filled with meaningless sports metaphors) Mr. Santelli tells us "Don’t get caught up in the minutia. All this BS." Well one man's minutia is another man's important detail. When confronted with the Conventional Wisdom world of pundits that is run by vain rants in front of cameras using focus group tested sound bites, the details have never been more important.

But this time, there is a reason that the vain elitist pundit does not want us looking at the details. According to Standard and Poors' Research Update- they lay the blame at the Republican Congress specifically the Gang of Twelve. They site failure of Republicans in Congress to raise revenues as a cause for concern that the Bonds may not be paid. In Standard Orwellian Doublethink he turned the situation on its head with an exact reversal of the facts and claimed the Tea Party was to be thanked for avoiding a BBB rating. And typical of a concise TV pundit presentation, no evidence is ever presented to back that up (although I'm sure mises.org is busy cherry picking those facts right now).

As I mentioned in my Where are we on the Deficit Football Field piece-we are nowhere near default. You can go to the CIA World Factbook and look at what our external debt is is in relation to our GDP. You can compare this with other countries. There are countries with higher ratios of external debt to GDP and they have no run on their bonds. This was an entriely contrived crisis (the goal of which is not fiscal solvency but killing socially beneficial programs) which Standard and Poors reacted to by correctly saying whom was at fault.

And if we were to go in the other direction, we could immediately do something direct about unemployment (Government workers and contractors do spend money and there is a multiplier effect). We could put people back to work repairing our infrastructure. We could eliminate many states deficits and have adequate fire, police and schools. Rick Santelli would throw a fit. But look at his behavior in February 2009 when a meager stimulus was being pushed through Congress to deal with the worst financial crisis in recent history. Mr. Santelli and others like him are going to throw fits no matter what is done (especially when cameras are present). As we recently saw in the "debt crisis" debate, there is no appeasing him or those like him, so it should not even be attempted.

At the time where Mr Santelli did his famous "Well, Mr. Obama..." schtick in front of the CNBC cameras, the think tanks that spread a message similar to his were busy rebranding the policies that had brought us to this point, and part of that playbook was saying "Failed" Stimulus instead of Stimulus especially when there were cameras shooting video. It was February 2009.

There are problems with taking the Dow as an indicator of economic health, but as a general yardstick, I'll use it now merely because it is so widely used. In Feb 2009, the Dow was at 7,600 approximately. The Stimulus failed so much that the Dow turned around and headed up to 12,500 in the space of two years. Unfortunately, it was not enough to deal with unemployment. Unemployment and underemployment are the true bites, the true measure of human misery. of any recession. To Mr. Santelli it is merely a number on a page and a higher ration of impoverished souls he must look at on his limo ride to and from the Chicago Board of Trade. He has a very important job of investing people's money until it is all gone, so I'm sure that added stress on his limo ride is very harsh on him!

But let's put a move like that in historical perspective, The Dow was at 7,600 in November 1997 and passed 12,600 in February 2007. That's some failure! Ten years (with wartime and deregulation caused housing bubble stimulus) worth of stock improvement in just 2 years is impressive. If it had been big enough to put people back to work, the Democrats would never have had to give away my Medicare benefits to Washington elitists in order pay for the Afghan and Iraq occupations.

So now, The Dow has dropped down to where it was last December. That's all the value and economic progress of this entire year evaporated because no one stood up to the "Gang of Twelve" freshman Republicans. And as a quick History lesson, didn't they welcome Obama into office with a cry of "I hope you fail!"? Regardless of the Unemployment, Underemployment and misery of their fellow citizens, they want Obama to face reelection with a poor economy even if they have to be the ones who kill the recovery personally.

As of this writing, I can't say how low it is going to go. No one can! I think I can say with some accuracy, that just as these creatures of publicity were using "Failed"Stimulus just as the stimulus was, in fact, succeeding...they will refrain from using Failed Austerity just as the Austerity they recommend is in the process of failing. It is the nature of the hypocrite.

And one doesn't have to dig far to find hypocrisy behind these loud narcissistic buffoons. Going beyond Mr. Santelli, the leader of Tea Party Nation, Judson Phillips, just revealed to the world something he believes would solve our economic problems-shovel ready projects! That's right, when confronted with the possibility of going from 11 to 9 carrier task forces, Mr. Phillips turns Keynsian! He said, "Thousands of employees would be hired for the steel mills that would provide the steel for the hull and various sub contractors would hire thousands. Do you know what that means?It means they would receive paychecks and go out and spend that money. That would help a recovery. That is a shovel ready project!"

So applying that proven form of economic cure to something that helps people instead of killing them and protecting our oil empire is Socialism and we can't have that, because we'd wind up like the victims of Stalin?

Actually repairing our infrastructure so we can compete with other countries is unthinkable as long as we have this deficit?

I have to compromise my Medicare in my old age with a worthless private voucher so Defense Contractors get to keep raking in millions, while killing civilians in other countries and drinking vodka out of each other's butt?

I have to say enthusiastically and loudly HELL,NO!!

And just to put things in perspective about just how contrived this crisis and these cuts really are-Look at this breakdown of the deficit

Obama and his "out of control" spending at a time when most of nation desperately needs that spending, is $2.4 Trillion. The incompetence and failure of George W. Bush (Iraq and Afghan wars, tax cuts for the rich, Housing bubble) account for $6.1 Trillion. If we absolutely HAD to cut the deficit (we don't) we could easily cut from the Bush part and still have enough money left over to put paychecks in Americans hands again and reclaim our place as the greatest nation on Earth.

Rick Santelli won't like it. Neither will Judson Phillips. But until I see them behave like loud narcissistic buffoons when a Defense bill is being considered or when a proposal to raise taxes on the people and entities who actually have money, there is zero reason to give them ANY credibility!

All revolutions provoke reactionaries. The Left should have realized this and not let them rebrand their failed policies so fast!

If Mr. Santelli wants to use Sports metaphors, here's one that should be considered. The Boston Red Sox went from being the losers everyone joked about to winning two World Series in the past 7 years when they embraced William James' Sabremetrics. It was a revolution in sports statistics that is still being felt. When Grady Little, their manager failed, they brought Bill James into the organization embraced his philosophy and have not looked back!

Mr. Santelli, Judson Phillips, Grover Norquist and others are the Grady Littles who screwed up and now feel entitled to have thier jobs back even as the market is getting massacred immediately after getting precisely what they wanted!

This week in Ignored Financial News-June 17, 2011

“The most unfiltered news you can find is going to be in the Financial Press,”-Noam Chomsky.

I’ve found that true time and time again. And although I haven’t found time to write a new column as of late (One is coming). I do find time to read the Financial News. And in that spirit, I’m going to be using my blog to link some of the stories I found of interest this week and why they merit a wider audience!

1)The externalities of Climate Change, Water Scarcity, Air Pollution, Biodiversity Loss and Ecosystem Degradation have been measured and nature is deeply in the red!

We’ve known for a long time that what are called “externalities” in economic equations are the source of a lot of what is wrong in our world. As a matter of fact, there is an economist from the University of Chicago-Ronald Coase who built his entire career on ignoring externalities! The Coase Theorem states that externalities should be ignored if property rights are defined, the number of people affected is small, and bargaining costs are negligible.
When we look at the environmental devastation inflicted on our planet, and this is a comprehensive business oriented paper that does just that, we find a cost of at least 6.6 Trillion (2008) Dollars with 2.15 Trillion of that being inflicted by the 3000 richest publicly traded companies. The Coase Theorem certainly does not apply!
The study concludes that there is a substantial long term risk to portfolios (and the workers and retires who own them) if things remain as they are. An estimated 28 % of World GDP (not US, but World) will be devoured as environmental externalities by 2050 if these trends are not reversed!

2)Wal Mart co exists just fine and profitable with unions-as long as they are not in the United States!
It’s been a long known policy of Wal-Mart that it will shut down a store before it allows it to unionize. This is brazenly illegal, but that does not stop the policy. Wal-Mart would rather pay the fine, screw over towns whose businesses have been demolished by Wal-Mart’s policies, and build somewhere else than allow a union to exist in one of it’s U.S. stores.
But when it comes to unions overseas, they recognize the rights of workers with no problem! China-Totalitarian China-can have union representation at their Wal marts, but the most free country on Earth can not!

3)Efforts to end “Too big to fail” have failed
An out going FDIC Chairman has just declared victory on her way out. Kind of like William Bennett declaring victory in the War on Drugs before stepping down as Drug Czar, when a Washington bureaucrat says the problem has been solved, expect the exact opposite!
4)But JP Morgan Chase’s Jamie Dimon still cries about modest changes
The greatest financial implosion since the Great Depression, and this asshole wants his casino back. Not only that he claims that it will hurt the economy for him to not be able to gamble with other people’s money and then be bailed out by taxpayers!
5)Dow Jones Business News commentator offers a scathing criticism of Ayn Rand and the effect she is having on our markets and world!
The conflict between Jesus Christ’s and Ayn Rand’s ideology is not something the Republican party can ignore! It needs to be addressed publicly!!Seriously, Democrats, RAM THIS DOWN THEIR THROAT!!!
6)The unfulfilled 2008 campaign promise to stop companies from moving good paying jobs overseas is about to hurt more Americans. Also it decreases our taxbase while giving nothing back!
It is time for Barack Obama to pay attention to what he promised in 2008 if he wants to motivate the people who put him where he is to give him another 4 years!

And the threat of Deflation (the Greek "crisis") didn't happen! An economy the size of New Jersey did NOT sink the global financial system through Deflation! Also, Ben Bernanke did not bring on Weimar-style Hyperinflation, now that we start feeling the effects of QE2! The people who want you to panic can't make up their mind if you should panic because of inflation or deflation.

I don't know about you but I laughed!

Where are we on the Deficit Financial Football Field?

With all the demagoguery surrounding the discussions of the Deficit, people with different agendas bombard us all with information that is often conflicting with the facts. To gain some perspective, I propose putting this deficit debates/demagoguery/drama of the last decade or so on a scale with which we are all familiar-a football field! And here is what I have found…
To start with, let’s identify the two extremes of Deficit politics. These will be our End Zones. Once the ball has gone in here, the game has changed. On one side we have a balanced federal budget dependant on no external debt, an opportunity to return to the gold standard with gold reasonably priced and all the stability and transparency that the modern equivalent of the gold specie flow mechanism would supposedly bring. On the other side of the field, we have the dollar becoming worthless with bond markets around the world refusing to buy our T-bills and the dawn of severe (if not hyper) inflation!
So where are we on this scale? It is a very difficult question to give a clear unqualified answer to. And one of the problems regarding answering this question is confirmation bias. Everyone is guilty of it, myself included. All too easily, stats that agree with our pet schools of economic thought will be highlighted and contradicting information will be dismissed. We’re only human.
I think we can all agree that this nation is nowhere near the Balanced Budget End Zone! As a matter of fact, I don’t think it’s an exaggeration to say we’re in our own territory with a Government-Fed Defense that keeps giving up yardage! But where are we? Are we inches away from allowing that hyperinflation touchdown? Are we in the Red Zone with one screw up getting out of hand resulting in that touchdown? Does recent news from the IMF that they would rather replace the U.S. Dollar with the SDR-IMF currency count as being at the Red Zone? Or does that count as us scrambling to stay out of Field Goal Range? Were we really on the other side of the field during the Clinton years and able to kick in the balanced budget Field Goal?
I’m afraid that I have to stop my little thought experiment here for just a moment. Using a football field as a scale is problematic, as I’ll demonstrate shortly. And the problem with Football metaphors when it comes to an exercise like this is that they can be too easy to spin. I’m trying to use a Football Field to gain some idea of the scale that we are dealing with. It’s all too simplistic to answer those questions that fit whatever school of economics you back with a football metaphor. We run the risk of diverting our thought experiment if we indulge in that too much.
Some obviously absurd examples…
“Well, you obviously know nothing about economics if you don’t agree with what Lord John Maynard Mises said regarding this very issue, we punted the ball in ’72 when we gave up the gold standard!!!”
“Nonsense, Ludwig Von Keynes said we could intercept the Shotgun Pass at Fed induced inflation and thus there is no Liquidity Trap!”
“You’re both wrong, the Phillips curve combined with Barack W. Bush keeping the Iraq War off the books shows we could have guns and butter before Alan Bernanke fumbled the ball with the Housing Crisis!”
I don’t agree with any of what I just spouted…I just wanted to demonstrate that I can pull this nonsense out of my butt all day if I have to. Let’s agree to forgo it and get some scale of just where on the gridiron we are. We can go back to our teams when we are done!
Let’s try to define the Balanced Budget End Zone for starters. Per CNBC, the U.S. has 8,965.6 tons of gold in Fort Knox. It’s the biggest stash of gold in the world. Compare that to Germany (3,749.8 tons), the IMF (2814.1 tons), Italy (2,702.6), France (2,684.6), China (1,161.9 tons) and Switzerland (1,146.5). Further adding to our international strength in this regard, the U.S. is by far the largest member of the IMF. The SDR (Special Drawing Rights) currency that the IMF was advocating to replace the US dollar is weighted with U.S. Dollars. Every SDR is 41% U.S. dollars. So if we apply that ratio to the IMF’s gold supply, our gold reserves are 10,144.7 tons. Germany, France, Italy and China combined have 10,298.9 tons.
If we were to put a dollar value on our gold supply at the current market price, $1500 per ounce then each ton of gold is worth 48 million dollars at 32,000 oz per ton. That means our total gold reserves including what we have weighting the IMF’s SDR is $486,945,979,200.
And at this point, we need to return to the first day of class in Economics 101 and answer the question “Are Assets Money?” And we need to do that because there is an obvious discrepancy between the $486.9 Billion figure representing our gold assets and the $14.72 Trillion figure that is our GDP. It affects the size of our theoretical Football Field. If our attempt to go back to the gold standard merely raises the price of gold to the point where everything has gold backing and we don’t care what the price of gold rises to, do we go with representing everything in our $14.72 Trillion economy with Fort Knox gold? Or do we merely cover the current Federal budget expenditures subtracted from our budget outlays (about $1.3 Trillion)?
Well, if everything in our economy is going to be represented by gold in Ft. Knox, then one ounce of gold is worth $45,343.87. If we’re only going to cover the outstanding Federal budget expenditures when we do this and afterwards behave ourselves then the price of gold is $4,004.50 per ounce.
In June 2000, when the price of gold was $290 per ounce and Bill Clinton was in office, each ton of that same amount of gold would have been worth $9,280,000 per ton for a total of $10,942,121,312. Adjusting for inflation brings the number up to $14.29 Billion. That’s $486 Billion worth of gold now that would only be worth $14.29 Billion if we returned to the gold standard when it was cheap back in the Clinton years and had not messed with the markets at all no matter what our needs are. That’s a factor of over 34 between 2000 and now.
It illustrates a very important point about this gridiron, it is elastic where as a real gridiron is not. If this were a real football team playing, don’t you think the Offense would have noticed the field stretching and said something if the Defense kept giving up enough ground to score 34 touchdowns and yet they only remain just outside Field Goal range?
The game could have changed if we had gone back to the gold standard when gold was $290 an ounce in 2000. The opportunity was blown (by a conservative House and President at the time) and probably won’t come around for another generation. Part of the reason this is advocated is that you lose the ability to stretch the field if we return to the gold specie flow mechanism. The equilibrium would be automatic in that case.
Are assets and wealth considered money? Not the way things are right now. Land, gold, silver, and other commodities are very problematic for pure barter. Money is the mental contract we all indulge in for easier barter of not only these commodities, but also finished goods and services. Gold backed currency can indeed fit the definition of money. But so can fiat currency, so can casino chips in the casino they represent, and so can electronic ink on a hard drive in the Federal Reserve building.
There are problems with fiat currency as well. Which brings us to our other End Zone the point at which the Bond markets quit supporting the fiat U.S. dollar. Our current GDP is $14.72 Trillion per CIA World Factbook. If we add up public debt (the debt held by the public only) and the gross debt (the intergovernmental debt owed to ourselves) we arrive at a figure that is approximately 88.9% of GDP. We are actually in good company of other countries who have large gold reserves. France has public debt that’s 83.5% of GDP, Germany has public debt that’s 78.8% of GDP. The U.K has 76.5% and China has 75%.
As a matter if fact, you can see how unrelated public debt and quality of life in a country are by scrolling down to the bottom of the list and seeing a country with 3.3% GDP worth of public debt and a quality of life so good that they are currently in the middle of a Civil War-Libya!
But to be fair, let’s establish a number that uses external debt as the tipping point for the U.S. dollar. If we go to the list of external debts (not public debts), the US is the leader at 13.98 Trillion followed by the other countries/Central Banks with high gold reserves, the E.U., U.K., Germany and France. When it comes to this ratio-External debt to GDP, other high gold reserve countries are not as close as we are.
Country External Debt GDP
USA 13.98 Tr 14.72 Tr
France 2.16 Tr 4.69 Tr
Germany 2.96 Tr 4.71 Tr
U.K. 2.19 Tr 8.98 Tr
China 406.6 Bl 9.87 Tr
Italy 2.22 Tr 1.7 Tr
Greece 532.9 Bl 321.7 Bl

So let’s give a generous benefit of the doubt and call the point at which Bond investors get tired of playing on an expanding Football Field and lose confidence in the currency of the country with the largest gold reserves in the world as when we become like Italy (a country with high gold reserves) with approximately external debt 130% of GDP and public debt 118.1% of GDP. The reason for that is that Italy is a high gold reserve country with a Central Bank (like us) and there have been calls recently to question Italy’s ability to service their external debt. The point where our external debt has reached $19.136 Trillion will be our Insolvency End Zone. Incidentally, there is currently no run on Italy’s debts just rumors, but we are bigger than Italy.
On one end we have where we were in 2000 with $14.29 Billion worth of gold in Fort Knox, gold at $290 an ounce and a projected budget surplus. On the other end we have $486.9 Billion worth of gold in Fort Knox with gold at $1500 an ounce and external debt of 19.136 Trillion. And we’ve just stretched the Field again by raising the debt ceiling. So, where are we?
Contrary to popular belief we never had a budget surplus in 2000. We had a projected surplus. It would be as fair to call the projected 2000 Clinton surplus Field Goal range as it would be to call where we are now Field Goal Range. A misstep dealing with the debt ceiling would cause a crisis of confidence in the Bond markets, but that won’t happen if we stretch the Football Field again (which we will)!
I think it’s safe to say that we are playing Defense just outside of Field Goal Range. And it is important to remember how we got here. Because if we can reverse it, we can regain ground we lost.
We are not at 1st and inches on our own goal line no matter what the pundits repeat ad nauseum. There is a difference of $5.156 Trillion before we get to that point. And that’s assuming that Bond markets would react negatively to us. Let us not forget that the Italian Euros are not the world’s default currency and default petro-currency, so we might have more leeway than Italy if things come to that.
So what was just outside Field Goal Range on the other side of the Field when we could have kicked that ball and achieved a balanced budget? Let’s start with 2003, the Iraq war had started and we had some of the current deficit hawks saying very clearly that they welcomed more debt. Rick Santorum let it slip that he did not consider himself a deficit hawk and he loved being able to use a lack of funds as an excuse to say no! (There is something very revealing in the way Washington elitist hypocrites absolutely loath tax money being spent to directly improve the lives of the people who pay those taxes.)
In 2003, with the war machine spending money like a coked up spoiled rich boy whose daddy was the local Congressman, our GDP was 10.918 Trillion dollars. Adjusted for inflation that’s 13.345 Trillion in 2011 dollars. Our external debt was 6.57 Trillion. Adjusted for inflation that’s 8.03 Trillion in 2011 dollars. That’s external debt that’s a little over 60% of GDP. That’s the 30 yard line on the Balanced Budget Side.
So the difference between that 30 yard line and the 30 yard line on the Fiscal Insolvency side is the difference between 60% and 95% of GDP in 2011 dollars on a Football Field we can stretch and distort as much as we may need to.
The reason we can not possibly be at the 1st and inches point is because of the behavior of the House Republicans so far. Since riding into office on promises of fiscal responsibility, they have spent $7.5 billion in extra defense spending which offsets them using deficit concerns to cut $4.4 Billion from programs they have always hated anyway. If this really was a 1st and inches deficit situation, they wouldn’t propose going $3 Billion closer towards fiscal insolvency and hyperinflation. They can’t advocate repeal of the meager Health Care reform at a cost of $23 Billion per year and have the claim that “we are out of money” be taken seriously! If we are truly on the verge of losing confidence of the Bond markets, why not lose the useless and counterproductive oil and ethanol subsidies, worth $99 Billion total?
Oh, and by the way, am I the only one who noticed that we opened up a new third military front at the exact same time we “ran out of money” last April?
The things that moved us down to this position on the field faster than anything, the Bush tax cuts and the Iraq/Afghan war, could move us safely back to better field position if we went back to 1990’s tax rates (worth $3 Trillion) and brought our soldiers home now that bin Laden is fish food (worth $159 Billion).
If anyone in Washington really cared about its unemployed citizens, it would stop the financial bleeding of the States who have to cut jobs right and left. The cost would be the equivalent of giving up a yard or two in the direction towards fiscal insolvency, true! But Police, Fire and Education would be strengthened instead of weakened and thus those states would be more attractive for investment. Consumption would increase as would the tax base and we’d find ourselves moving the other direction down this Football Field FAST!
And just in case you thought that China buying our T-Bills during the Iraq War and enabling this situation to come about was done out as a kind byproduct of “Free Trade”, take a good look at their external debt to GDP ratio. Their external debt is 4.12% of GDP. They are in a 1st and inches position to score a game changing touchdown and Obama, the GOP, Bush, and conservatives nationwide helped them do it!

The Real Legacy of Ronald Reagan Part 2

The man behind the myth sheds a lot of light on why there is a need for a myth in the first place. If you go into the Capitol Rotunda, you will find a statue of this man who broke the laws of the very body where this statue is housed. What kind of person was the man who busted air traffic controller’s unions, enabled the deregulation that caused the Savings and Loan implosion and whom was busted lying to the American people about the Iran Contra affair and why does he deserve to have history rewritten in his favor?

Despite his belief that Biblical End Times prophecy should influence policy, (he once called the Soviet Union “Gog”) he and his wife were devout believers in Astrology. Astrology, is frequently derided by many Fundamentalists as witchcraft, but Ron and Nancy get free passes because they have so enabled the social conservative agenda. Nancy took it so seriously that she ordered dedicated phone lines to be installed in the White House and Camp David so she could never be without the wisdom of the zodiac.

The President of the United States had his wife’s personal astrologer go over his itinerary and change it so that everything was optimized for the best influence of the Zodiac. Chief of Staff Don Regan was ordered to confer with Nancy regarding which days were best for the President’s activities. According to Joan Quigley’s memoirs, this belief in superstition was taken to seriously that the announcement of Anthony Kennedy for the Supreme Court was coordinated by a man with a stopwatch to insure that the man hit the correct moment!

This belief in superstition was echoed in the most powerful commander-in-chief of armed forces in the world believed completely in End Times eschatology. A man with the power to bring about Armageddon was a believer in Astrology and was quoted in the December 1983 issue of People magazine as saying-

"Theologians had been studying the ancient prophecies -- what would portend the coming of Armageddon-- and have said that never, in the time between the prophecies up untiI now, has there ever been a time in which so many of the prophecies are coming together. There have been times in the past when people thought the end of the world was coming, and so forth, but never anything like this."

This attitude was reflected in his Administration as well, His Secretary of the Interior James Watt, a man whose job it was to preserve the environment for future generations once said, “I do not know how many future generations we can count on before the Lord returns.”

But Reagan was very much a believer in hands off management. His job was not to lead. It was to use his movie star media savvy experience to sell an agenda to the American people while posing in front of a flag, reciting humorous stories, and reading a speech off a teleprompter. And he was given a pass by the press on that for most of his time in the White House.

Understand that Reagan had been shot while in office only 69 days. The press initially went easy on him. The public sympathy towards their leader was similar to what happened to George W. Bush after 9-11. The press took it easy on him when it should not have. The Executive Branch of the U.S is so powerful that it should never be given a free pass from inspection simply because pundits say that now is the time to rally around our leader.

But it makes sense that if a leader is basically hands off to an agenda that increases the deficit that was such a dire concern in the 1980 campaign, deregulates the S&Ls so that his contributors can have high yield no risk investments, increases defense contractor handouts, violates a law regarding funding terrorists in Central America with US taxpayer money, and empowered the Mujahadeen and Osama Bin Laden, elevate a War on Drugs that savagely curtails our legal rights, if you benefit from any of these policies, then the man is a hero who deserves his name on an airport.

That’s the reason behind the retelling of recent history. The powers behind the throne, the think tanks, the real Washington elite had a perfect sock puppet in Ronald Reagan. However horrible the policy, he can look the camera in the eye, justify it in focus group selected words which some speechwriter wrote that he reads convincingly off of a teleprompter.

He could even lie through his teeth to the American public regarding breaking the law and not be held accountable. On November 19, 1986, Ronald Reagan held a press conference regarding selling Tow and Hawk missiles to Iran. He said “…We only sold a few missiles” (more than 2,000 were sold), “We don’t condone shipments to 3rd parties…”, (Israel shipped the missiles), “The missiles were not sold to get back hostages…”(They were sold for that and to fund the Contras) and “We are trying to promote a dialogue with Iranian moderates…” (This was Khomeni’s regime. The moderates were either dead or in jail!)

Two months later, when testifying in front of the Tower Commission on this matter, he specifically acknowledged approving the arms sales. Two weeks after that he tried to reverse that and say his prior statement was erroneous. He was even caught accidentally reading his own notes on evading questions aloud into the record. He said under oath while looking at his notes “If the question comes up at the Tower Board meeting, you might want to say that you were surprised.”

Ronald Reagan could get away with saying that South Africa had stood with us during every war we’ve ever been in. They were actually on the other side during a war Mr. Reagan had fought in himself. He allowed an invasion of Beruit, then ran away while accusing his political opposition of cowardice. He escalated the Nixon era policy of a War on Drugs that serves to imprison people cruelly instead of treating their addiction.

He pardoned W. Mark Felt and Edward Miller for authorizing FBI agents to break into VietNam protesters’ offices without a warrant (small government behavior? I don’t think so!)

When he was running for office he said-
-“All the waste in a year from a nuclear power plant can be stored under a desk."- Burlington Free Press, 15 Feb 1980
-“History shows that when the taxes of a nation approach about 20 percent of the people's income, there begins to be a lack of respect for government... When it reaches 25 percent, there comes an increase in lawlessness.”- Time magazine, 14 Apr 1980
-"Because Vietnam was not a declared war, the veterans are not even eligible for the G.I. Bill of Rights with respect to education or anything."- Newsweek magazine, 21 Apr 1980
-"Trains are not any more energy efficient than the average automobile, with both getting about 48 passenger miles to the gallon."- Chicago Tribune, 10 May 1980
-"Approximately 80% of our air pollution stems from hydrocarbons released by vegetation. So let's not go overboard in setting and enforcing tough emissions standards from man-made sources."- Sierra magazine, 10 Sep 1980
-"I have flown twice over Mount St. Helens. I'm not a scientist and I don't know the figures, but I have a suspicion that one little mountain out there, in these last several months, has probably released more sulfur dioxide into the atmosphere than has been released in the last ten years of automobile driving or things of that kind."- Time magazine, 20 Oct 1980

Each of these statements is provably false and he was elected anyway. That might explain why Donald Trump isn’t concerned about being the Birther candidate!

The man obviously existed in a delusional fog completely divorced from reality. But he could read a speech in front of a teleprompter and make the nation feel that gaps in these falsehoods were not important, we’re being protected from the Soviet’s Evil Empire by him and his cronies.

I think that is the reason behind the recent Jan 21st Time Magazine cover stating Obama loves Reagan! Obama admiring this man and contributing to his myth, shows the current Chief Executive’s true colors. He has no problem letting the country be run by interests who did not or will not vote for him. As long as he can read a speech from a teleprompter and make us feel good about the worst ideas Washington elitists come up with, he has every reason to think he can repeat what Reagan did with a sluggish economy and low approval ratings.
But the bias in the news media is not liberal. If it was Reagan and Bush II would never have been given the free passes they were. I can’t see Obama making the deliberately false statements like Reagan did during the coming campaign and getting away with it.

Admire the political ability of Reagan or his handlers if you must. But as a person and a President, he was sorely lacking. How does Reagan, a proven senile, superstitious, delusional old fool, deserve his name on an airport, much less having history rewritten in his favor?