Wednesday, April 22, 2009

Obama and Friedman

I think Obama is dumb, an emptyhead who knows nothing. And I think he sometimes half-realizes that himself. Because of his profound ignorance, it seems that Obama has heeded his advisers on what to do about the economic crisis, and, whatever one thinks of them, they are NOT dumb. And what they are doing through Obama is not as silly as most conservative commentators make out. Conservative commentators routinely brand the Obama policies as "Keynesian", which they undoubtedly are. But they fail to look at the alternative. And Milton Friedman's analysis is of course the alternative.

Keynes correctly identified the major problem of the Great Depression as being a demand deficit. He thought that deficit could be made up by a large program of government spending on public works. Friedman, however, looked deeper and asked WHY there was a demand deficit. And the answer to that was almost childishly simple -- far too simple for intellectuals. Friedman pointed out that the rash of bank failures created by the incompetent Federal Reserve system of the day after the 1929 crash was the culprit. As banks failed, the savings invested in them vanished. People lost their money and they could not spend money they did not have. THAT was the reason for the demand deficit.

So both Keynes and Friedman agree that spending power has to be restored. Friedman was certainly very emphatic about the importance of a stable money suppy. From Friedman's analysis, the obvious priority is to protect people's savings -- and the FDIC was set up to do just that. And the FDIC has indeed had some role recently. But, however we do it, in the end we have this time not made the mistake of the Great Depression. Spending power is being restored even if it is being done in a very slow and sub-optimal way. So I expect that there will be substantial recovery by the 2010 mid-terms -- which is a very mixed blessing from my point of view.

How about that! I am venturing a prophecy. Since 99% of all prophecies are wrong, I am offering a stringent test of my understanding indeed.

The very best way of restoring liquidity to the economy would probably have been to cancel all company tax for one year. That would certainly have done more to preserve and create jobs than handing out trillions to the prestidigitators of Wall St.


Federal Lawsuit Filed Over DHS ‘Rightwing Extremist’ Report

The Thomas More Law Center, a national public interest law firm based in Ann Arbor, Michigan, announced last week that it filed a federal lawsuit against Homeland Security Secretary Janet Napolitano. The lawsuit claims that her Department’s “Rightwing Extremism Policy, ” as reflected in the recently publicized Intelligence Assessment, “Rightwing Extremism: Current Economic and Political Climate Fueling Resurgence in Radicalization and Recruitment, ” violates the civil liberties of combat veterans as well as American citizens by targeting them for disfavored treatment on account of their political beliefs. Click here to read the complaint filed by the Thomas More Law Center.

Napolitano tried to blunt the public furor over the Report by a half-hearted apology to veterans, but she left out of her apology all of the other Americans her Department has targeted because of their political beliefs. In fact, officials in DHS now admit that their internal office of civil liberties objected to the language in the extremism report, but the Department issued it anyway.

Janet Napolitano is lying to the American people when she says the Report is not based on ideology or political beliefs. In fact, her report would have the admiration of the Gestapo and any current or past dictator in the way it targets political opponents. This incompetently written intelligence assessment, which directs law enforcement officials across the country to target and report on American citizens who have the political beliefs mentioned in the report, will be used as a tool to stifle political opposition and opinions. It will give a pretext for opponents of those Americans to report them to police as rightwing extremists and terrorists. You can imagine what happens then.



Vive la France!

In what may mark the first ever occurrence of its kind, France is right. Additionally, its leader is refusing to surrender. And that's no joke.

At a recent lunch with members of the French parliament, President Nicolas Sarkozy dove headfirst into one of the three forbidden table conversation topics: politics. Although the menu options are unclear, the French President made kabobs of his fellow world leaders by skewering them through and through.

Angela Merkel, he said, was confused at the G-20 summit. He likewise charged that José Luis Rodríguez Zapatero of Spain is not “very clever” and Italy's Silvio Berlusconi is a power-hungry narcissist.

Some of his harshest words, however, were reserved for Barack Obama. Referring to him as “weak and inexperienced”, President Sarkozy said that his American counterpart:

“has a subtle mind…was elected two months ago and never ran a ministry in his life. He doesn't have a position on a number of things…[Mr. Obama] is not always operating at a level of decision-making and efficiency.”

Wait a second. Was that criticism? Of Barack Obama? Couldn't be! If you're an establishment member of the mainstream media, now would be a good time to shout “stop the presses!”—that is, of course, if the presses weren't already going out of business thanks in part to their utter abandonment of unbiased, journalistic accountability.

Granted, somewhat thorny relations between the American and French heads-of-state have been a recurring trend over the years. But this is entirely different. Mr. Obama is, of course, the self-proclaimed “citizen of the world,” a transcendental leader who's come to put America back in the good faith of its neighbors. Unfortunately for him (and fortunately for freedom-loving societies worldwide), that doesn't seem to be the case anymore.



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The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)


1 comment:

Robert said...

I'll offer a different prophecy with regard to the one in Obama and Friedman. Sometime around the first quarter of 2010 or the last quarter of 2009, the current upswing in social mood, as measured by the stock market, will end, perhaps with some apparent signs of recovery, but short-lived if so, and an even bigger drop in mood, again reflected in the stock market will begin. A likely trigger will be a realization that the entire banking system is well beyond broke, and about $600 trillion in the hole. And a likely trigger for that is when it becomes obvious that the mortgage-backed insecurities they hold and value at roughly 98 cents on the dollar under mark-to-fantasy accounting are not worth nearly what the banks are reporting on their balance sheets. (When they trade, they trade for about 20 cents on the dollar.) The increasingly negative mood of the American public will have everyone blaming the Democrats for causing the wipeout, resulting in a sweep of the Democratic party out of power in at least one legislative chamber in 2010, and then finish with another big "Throw The Bums Out" election in 2012. We will still see a Greater Depression, with all the attending ugliness. It should see the lows sometime between 2013 and 2016.